November 19, 2025 • 38 mins
Chuck Zodda and Marc Fandettil express their concern for the labor market, private credit market, and AI spending. Wall Street faces a critical test from Nvidia and delayed jobs data. Todd Lutsky joins the show for his weekly segment, Ask Todd. This week, Todd explains the differences between revocable trusts and wills.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
The Financial Exchange is produced by Money Matters Radio and
is hosted by employees of the Armstrong Advisory Group, a
registered investment advisor. All opinions expressed are solely those of
the hosts. Do not reflect the opinions of Armstrong Advisory
or anyone else. Investments can lose money. This program does
not offer any specific financial or investment advice. Please consult
your own financial, tax, and estate planning advisors before making
(00:20):
any investment decisions. Armstrong Advisory and the advertisers heard on
this program do not endorse each other or their services.
Armstrong and Money Matters Radio do not compensate each other
for referrals and are not affiliated. This is the Financial
Exchange with Chuck Zada and Mark fan Daddy, your exclusive
look at business and financial news affecting your day, your city,
(00:42):
your world. Stay informed and up to date about economic
and market trends, plus breaking business news every day. The
Financial Exchange is a proud partner of the Disabled American
Veterans Department of Massachusetts. Help us support our great American
heroes by visiting DAV five K dot Boston and making
a donation today. This is the Financial Exchange with Chuck
(01:05):
Zada and Mark Vandetti.
Speaker 2 (01:10):
Chuck Mark Tucker with you here on a Wednesday, and
we got a fun one lined up today. It is
in Nvidia earnings day. And anytime that you have I mean, look,
the best way to describe it in the context of
this market is anytime you have the largest company on
(01:31):
the planet reporting earnings and the options market for that
company projecting a seven percent move in either direction, well
you kind of got to wake up and pay attention
to it. So we'll have a little bit of discussion
on in Vidia also this afternoon. Not normally something that
(01:52):
I find interesting in any way, shape or form, but
we get FED meeting minutes, and I'm a little more
interested this time, partly because just the overall dearth of
you know, economic data that we've had, but also the
FED over the last couple of weeks, FED speakers have
indicated more, you know, more pushback against the idea of
December rate cut than I think I had anticipated. So
(02:13):
I'm interested to see what those meeting minutes may say.
And tomorrow we're going to be getting the September jobs report,
so we'll do a little bit of a preview of
what to expect there with some outdated jobs data that
is going to be gracing our computer screens at eight
thirty am tomorrow. So ultimately where we stand right now
(02:34):
is markets are you know, kind of at a point
where you know, there are some real questions that have
reared their heads in reared their heads sure in the
last month or so. The two big ones, in my
opinion read three big ones that are out there. Number
one the labor market. Is it continuing to slow? Number
(02:55):
two the private credit space. Is it going to be
a problem for the overall health of the financial system
or is it just you know, these few little blips
here and there that don't turn into anything big. And
third one in the artificial intelligence space, is the rate
of spending that we've seen projected into the future actually
(03:17):
going to be realized as that kapex starts to hit
financial statements over the next year or two in the
form of additional depreciation, Like at some point you actually
have to make money off this stuff, not just build it.
So this has caused a few wobbles and markets over
the last month or so, none of them particularly big.
(03:38):
I mean, even this last one at the open air
at the close of yesterday, it was like four and
a half percent, down from the all time highs that
we hit in October. Again, that's why I characterize these
as like little wobbles. But the question that you ask
on this is do little wobbles turn into something bigger?
And we're going to get you know, not the final land,
(04:00):
but we're gonna get in Vidio earnings today that can
tell us a little bit about what's going on with AI.
We'll get that jobs report tomorrow that'll tell us a
little bit about the labor market. And so I'm kind
of excited about what the next twenty four hours has
in store for us.
Speaker 3 (04:13):
That's great. So what are the big questions on people's minds?
You think, what's the stock market going to do next year?
Will it finish this year with a whimper or something
more impressive? What will it do next year? What will
economic growth be next year? We're on track for maybe
in line with trend economic growth this year about two percent.
(04:34):
We didn't get a GDP report for last.
Speaker 2 (04:36):
We think probably that range, which is not bad.
Speaker 3 (04:38):
It sounds weak relative to the last couple of years.
And we're talking real now, so inflation doesn't distort any
of these conclusions. Will it be stronger or weaker than trend.
And this year again it was choppy, but it was
about trend. Seemingly it about trend that we won't know
really for several months with all the revisions and stuff.
And then maybe related to that, unemployment. Is it gonna
(04:59):
hold steady word at about four point three according to
the last report. We'll get it updated ever later this week.
Will that go up or down? And then maybe some
people want to know about gas prices and prices particular
to the industry that they work in, or inputs that
they use for their company, stuff, stuff like that. But
I guess if you know the overall direction of the
(05:20):
rate of change is you like to talk about of
the direction of the economy's always growing, so on average
the rate of change is positive, But what is the
rate of change of the rate of change? Is it
going to pick up next?
Speaker 4 (05:29):
Sure is?
Speaker 3 (05:31):
Will it be zero? Will grow it about the same
rate as today? Or will it slow down? I don't
have answers to any of these questions. But some of
the news items that will come to fulfillment in the
next day or two or maybe week as the government
government data trickles in, will help us I think get
a better handle on what the answers to those questions might.
Speaker 2 (05:51):
Be, and so I think ultimately all markets, like all
bull markets, face challenges on a pretty regular or basis.
There's a reason why we say that volatility is a
feature of markets, not a bug. You have these questions
that get asked from time to time, and most of
the time they end up being resolved with, Okay, we had,
(06:13):
you know, a few bad days or maybe a bad week,
and markets fell you know, two to four percent, and
then the questions were answered satisfactorily enough and you move on.
Sometimes the questions linger a little bit longer, and you
end up with maybe a ten percent pullback, a market
correction as it's referred to, and you know, it might
take a month or so, maybe a couple months, and
(06:34):
you go through that ten percent correction, and then the
market gets a satisfactory answer and says, okay, I can
continue on and you know, resume you know, normal growth.
Other times, the market does not get a satisfactory answer,
and that's where you typically end up with bear markets,
which most of the time don't behave like the bear
markets that we saw in twenty twenty, which lasted for
(06:57):
all of you know, several weeks, or the one that
we saw this year that lasted for all of several months.
More often than not, bear markets tend to look like
twenty twenty two, where they can last for you know,
six months to a year, sometimes even a period of
multiple years if there's significant excess that needs to be unwound.
And that's because the questions are not answered satisfactorily, and
(07:19):
there's some pain that has to be felt in markets
by people that keep wanting them to be answered satisfactorily
even though they can't be. So the next you know,
six to eight weeks is about you know, starting to
find out, Hey, are these questions that you know? Number one?
Do they need to be answered right now? Sometimes the
answers just know you can't provide them and you need
(07:41):
to wait until later until you have more data. So
can they be answered right now? And if they can
be answered, do we get good answers the ones that
we want, or do we get bad answers that we
don't want but unfortunately sometimes have to say?
Speaker 3 (07:54):
Way, if Nvidia has a blowout report blowout the period
is the quarter right?
Speaker 2 (07:59):
Yes?
Speaker 3 (07:59):
Okay, they have a blowout quarter. Does that tell you
anything you didn't. Does that answer any of the questions
that to you are that are giving you heartburn right.
Speaker 2 (08:08):
Now about AI?
Speaker 3 (08:10):
Yeah, I don't think that's That's what I'm getting at.
Speaker 2 (08:11):
I don't think so in terms of their current quarter.
If their you know, future guidance is weaker than anticipated,
if they're you know, if they're trying to give revenue
guidance out further and it's not you know, what people anticipated,
that could be something that's.
Speaker 3 (08:26):
A concern, But how serious guys?
Speaker 2 (08:27):
Sorry, but quite honestly, the stuff that concerns people about
AI is not what was spent in the last quarter. Yeah,
it's what's going to be spent in like twenty twenty
eight through twenty thirty. And I just don't know how
great of an answer we can get on those questions
right now. I think they need to be answered probably
over the next twelve to eighteen months more likely.
Speaker 3 (08:48):
If there are real problems in credit markets. We've gotten some.
There are some disturbing tremors. They've yet to rerupt into
any thing major, but some indications that the the very
loose financial conditions for which I of course blamed the FED.
That's my eternal bumper sticker. Very loose financial conditions in
(09:10):
the past five years.
Speaker 2 (09:13):
I blame the FED.
Speaker 3 (09:14):
I that is a terrific idea Tucker.
Speaker 2 (09:17):
Can you get like financial exchange ones of those.
Speaker 3 (09:21):
And it doesn't matter what you're complaining about. You can
always conclude with you know, and Carthage must be destroyed,
as one of our moment ancestors like to say, and
the FED. You can always conclude your your your, you're fed,
you're Philippic with and the FED must be destroyed or
less radically, Yeah, maybe we don't want to threaten violence.
Speaker 2 (09:42):
No, I don't. I don't. I don't think it needs
to be you know, destroyed. He needed neither to. I think,
you know, And I blame the FED.
Speaker 3 (09:48):
Is just so very loose financial conditions, Chuck managers getting sloppy,
not doing their due diligence, not checking whether, say the
collateral was double pledged. As we've seen, there are a
lot of examples of this. Jamie Diamond, I think correctly
characterized it as cockroaches. We're gonna see more. Does that
(10:09):
suppose private suppose we have a credit crunch. Nvidia could
give the best looking forecast in the world today and
it's all irrelevant in six months if credit market sees
up again, yes, or even if they become less forgiving
than they are today.
Speaker 2 (10:24):
Yes. So I think that, in my opinion, like the
next six weeks, like the last six weeks of the year,
I don't know that you can get satisfactory answers to
put these things to bed.
Speaker 3 (10:37):
No, that's kind of what I'm trying to say.
Speaker 2 (10:38):
But you also might not need them because the market
might just say, Okay, these are things to worry about
in twenty six and let's have one last rally in
twenty five before you know, before we reckon with them.
So that can be an answer that you get as well.
Let's take a quick break and when we return, I
want to talk a little bit more about private credit,
and then we'll do some discussion of target earned as well.
Speaker 1 (11:02):
Missed one of our shows. Catch up anytime by asking
your Alexis Smart speaker to play the Financial Exchange. This
is the Financial Exchange Radio Network. Find daily interviews and
full shows of the Financial Exchange on our YouTube page.
Like us on YouTube and get caught up on anything
and everything you might have missed. This is the Financial
Exchange Radio Network.
Speaker 5 (11:33):
This segment of The financial exchange is brought to you
by the US Virgin Islands Department of Tourism. Your next
incredible vacation is a click away, and if you act fast,
you could be in Sant Croix to experience their Crucian
Christmas Festival taking place this December through early January. Discover
the magic of this long standing tradition with incredible food,
music and entertainment. Or just go soak up the sun,
(11:56):
stroll on white sand beaches and feel the rhythm of
the heartbeat of the island's The USVII is America's Caribbean paradise.
Plan your escape now at visit USVII dot com. That's
visit USVII dot com.
Speaker 2 (12:09):
Jamie Diamond asked back in October about the concerns in
the private credit market after the bankruptcies of Tricolor and
First Brands, said, Hey, look, usually when you see a cockroach,
there's generally others, and that then prompted Blue Owl CEO.
Blue Owl is a big asset manager who runs a huge,
(12:30):
you know, business in that private credit and private equity space,
and the Blue Owl CEO said, like, basically, in no
uncertain terms, Jamie Diamond, should you know, stick to his
own business, like we'll we'll do ours, and you know,
that was that. And then over the weekend, blue Owl
came out. It came out The Financial Times reported that
(12:50):
Blue Owl was trying to take one of their private
credit funds and merge it into a publicly traded fund,
giving investors in the private held one a twenty percent
haircut in the process. Subsequently, this morning, following the outrage
from investors over the last several days, Blue Owl has
said no, we're not actually gonna do that, and we'll
(13:12):
figure out a way to meet redemptions in the January
quarter instead. But Blue Owl didn't make the decision to
try to merge those funds just because they thought it
was like, hey, this is happy and great. They did
it because out of necessity, they couldn't meet redemptions that
were being requested at the prices that were being requested.
Speaker 3 (13:35):
Private markets are very different than public markets. When you
get into them, you don't know what they're gonna buy.
That's the whole point. It's kind of a blind trust.
You give a manager money. If your pension fund you
commit that's in the language of private markets, you commit
twenty million dollars to Armstrong fund. And this's a bad
exampleation to XYZ folk.
Speaker 6 (13:52):
We don't do that, by the.
Speaker 3 (13:52):
Way, but if we did, it would be x y
Z fund two because we had a one and it
was great, and now everybody wants in our fund too.
So a pension fund or an endowment, we'll commit twenty million.
You don't know what they're going to invest. You also
don't know what it's worth. They make educated guesses. Auditors
help them with this periodically for the roughly ten year
period during which you're invested, but you don't know. It's
(14:13):
quite opaque. That's why the returns have been generous relative
to public markets for a select few, very skilled private
market investors. And I put Blue Owl and some of
the others that you hear about Aries and Blackstone.
Speaker 2 (14:25):
There's a reason why they're as big as there. I mean,
Blue OU's a three billion dollar assets. They've generally been
skilly good at what they've done, and they've had some
favorable tail winds for the last decades in that market
as well.
Speaker 3 (14:37):
You cannot overlook that. So this is to be expected
if if you, as an individual investor, get into private markets.
Keep in mind you don't know what you're buying, and
that's okay. That's the nature of it. There's nothing sinister
about it. You don't really know what it's worth. That's
okay too. That's sort of what allows private markets to
be private market managers to be nimble and to effect
changes in the firms that they buy, as distinguished from
(14:58):
public markets, where you're really just a long the ride
and you don't know how long the investment's going to
take to come to fruition. Either private market managers can
extend the term of their funds or through other accounting machinations,
and I don't mean that in a negative way, give
their underlying investments more time to work out. It's just
a very different beast chuck in the idea of this
(15:18):
stuff going into a four h one k, even if
it's supervised by a diligent professional investment consultant something like that,
or someone who advises these four h one K funds,
I still wonder how the opacity and the very very
long term nature it's gonna sit with investors and a
couple different things.
Speaker 2 (15:37):
The first is, like earlier this year was when you've
really seen the push to try to get private assets
into four and k plans picked up, and quite honestly,
given what's coming out now, and I said this at
the time, I'm like, look, these companies have made an
awful lot of money by being exclusive to the high
net worth and institutional investor. The only reason they go
(15:59):
down market is generally because they've run out of, you know,
ways to raise money from those other types of investors
and they want someone else to kind of be that
next wave of liquidity. And this has done nothing to
dissuade me from that. Like, not quite the opposite. Blue
Owl does not want to deal with Jimmy, you know,
Q Public sticking fifty dollars a month into his four
(16:19):
to h one k.
Speaker 3 (16:20):
Plan and Blue Owl never will. They're hiring intermediaries, correct,
But the reason that they're doing that is because they're
not getting the money coming in that they want to
from other.
Speaker 2 (16:29):
Sources now or there.
Speaker 3 (16:31):
You know, there's about five hundred and fifty billion and
I'm not giving you a reference point, but trust me,
this is a lot of dry powder in private debt alone.
Dry powder means a pension fund is said, we'll give
you the money, but it hasn't been called away from
the pension fund yet because the manager hasn't had trouble
with an opportunity, I don't. It boggles the mind to
me anyway, why they need more They're sitting on way
(16:53):
and this is true, a venture cap moving over to
equity now it's true.
Speaker 2 (16:56):
Of it doesn't make me feel good as to why.
Speaker 3 (16:59):
Maybe, well, we know why, I mean, we know.
Speaker 2 (17:03):
So there's this and then this whole move from blue
out over the last couple of you know, over the
last week. Call it, I gotta be honest. It gives
me flashbacks to the summer of two thousand and seven
with Lehmann trying to shuffle you know, money around its
you know, mortgage backed securities funds in order to keep
(17:24):
the plate spinning like It gives me real flashbacks to
that Mark Well.
Speaker 3 (17:29):
The fact that if this was caused by i'll just
call it a run, a run on the fund, A
bunch of people went in said we want our money.
They threw up so called gates. Now I'm bringing hedge
fund language into this. But the problem this is a
better visual imagine everybody gets concerned about private credit this.
Speaker 2 (17:43):
It wasn't even everyone. It was six pen They receive
redemptions for about six percent of assets in the fund.
This stuff is.
Speaker 3 (17:49):
So inherently liquid and there's nothing again sinister about that.
It's the nature of the asset class that if indeed
people run for the there's no running for the exits
in private markets, much like there isn't with anything.
Speaker 2 (18:00):
Are not entitled to it anything.
Speaker 3 (18:03):
You're right, It is in the documents, it's in the contracts,
and this is true hedge funds too. They throw up
gates and like you said, there were instances of this
in six seven leading up to the crisis. They didn't
precipitate it, but sometimes they can be warning signs.
Speaker 2 (18:16):
So it just gives me a little bit of an
ugly feeling about it and worthy of further monitoring. Just
because this stuff doesn't happen when everything is hunky dory,
it still can be that this doesn't cause any major
issues in markets because it's not big enough to But
my antenna are fully up on this and paying attention
(18:38):
at least.
Speaker 3 (18:39):
Couple this with the alleged fraud. This is a different fun,
different management, different sub asset class, but other pieces of
evidence that very loose conditions over the past several years,
and you'll be shocked to find out I blame the
FED for those have precipitated larger concerns. Carelessness, laxity, and
lending has led to potentially larger concerns.
Speaker 2 (19:00):
So worth monitoring. Oh yeah, has the potential to cause
some real issues in twenty six. Yep, maybe we skate
through somehow, but this is something worth watching. And this,
by the way, has been a decade in the making. Like,
this is not something that you just woke up to
this year. This is something where the seeds of this
were sown in the mid twenty tens and maybe reaped
(19:23):
in the mid twenty twenty. Yes, let's take a quick
break here. When we return, it's Wall Street, Watch and
ask Todd.
Speaker 1 (19:40):
Like us on Facebook and follow us on Twitter at
TFE show. Breaking business news is always first right here
on the Financial Exchange Radio Network.
Speaker 6 (19:50):
We're proud to announce that circle K is now the official.
Speaker 7 (19:53):
Convenience store of the dav Department of Massachusetts. At circle K,
Supporting those who bravely served our country isn't a commitment,
it's a heartfelt mission. Circle K is honored to stand
with the dav Department of Massachusetts to ensure that.
Speaker 6 (20:06):
Veterans receive the care and recognition they deserve.
Speaker 7 (20:09):
If you'd like to do your part, please visit DAVMA
dot org.
Speaker 6 (20:13):
Thank you for standing with Circle K and the dav
Department of.
Speaker 7 (20:16):
Massachusetts, and thank you veterans for all you've done.
Speaker 1 (20:21):
Time now for Wall Street. Watch a complete look at
what's moving markets so far today right here on the
Financial Exchange, Radio Network.
Speaker 5 (20:30):
And video days upon US where the AI and Shift
Giant will report their highly anticipated third quarter earnings after
today's close, and Video stock is up over three percent
ahead of its earnings. As for markets right now, the
Dow is up about a quarter percent, or one hundred
and seven points, SMP five hundred is up over nine
tenths of a percent or sixty one points, Hired NASDAC
(20:52):
up about one and a half percent or three hundred
and twenty nine points, Russell two thousand and up over
one percent, ten Your treasure Field is flat at four
point one two nine percent, and crude oiled down nearly
three percent today, trading just above fifty nine.
Speaker 6 (21:07):
Dollars a barrel.
Speaker 5 (21:09):
More retailer earnings this morning after Target reported a decline
in third quarter sales as the company saw it shoppy
spending in shoppers hunting four value. Target also cut its
annual profit outlook and said it would invest billions to
upgrade stores to help lift sales. Target shares are down
over half a percent. Meanwhile, Low's is up by four
percent after the retailer b third quarter expectations, where its
(21:32):
online business helped offset weakness in the home improvement sector.
One other retailer to report, where TJX posted better than
expected earnings in revenue estimates. The parent company two tj
Max and Marshall's lifted its annual outlook again as it
continues to win over inflation weary shoppers. TJX shares are
(21:53):
up over one percent, Alphabet jumping six percent one day
after Google launched its updated Gemini AI motl Separately, Loop
Capital upgraded the stock to buy from holding, upped its
price target, and Constellation Andrew stock is climbing nearly six
percent after the company received a one billion dollar loan
from the government to restart its Crane clean energy nuclear plants.
(22:16):
I'm Tucker Silva in That is Wall Street Watch.
Speaker 1 (22:20):
This is ask Todd on the Financial Exchange Radio network.
If you have an existing estate plan or in the
market for one, Todd Lutsky is here to answer your
questions and help you plan for a later life. Ask
Todd is presented by Cushing and Dolan, serving Massachusetts and
New England for more than thirty five years, helping families
with a state and tax planning, Medicaid planning, and probate law.
(22:42):
Visit Cushingdolan dot com. Now here's Todd Lutsky.
Speaker 2 (22:47):
And we do have Todd Lutsky with us right now
for Ask Todd. Phone lines are wide open for you.
Get those fingers dial in eight eight eight two zero
five two two sixty three. That is the number to
call to Ask Todd your estate planning questions live on air. Again.
Eight eight eight to zero five two two six three
(23:10):
is the number. We usually get two to three calls
that we can get through. To make sure you call
early and often in order to get in line. That
phone number again is eight eight eight two zero five
two two six three. Mister Lotsky, how you doing? I'm
doing great.
Speaker 8 (23:29):
I'm afraid to ask you.
Speaker 2 (23:31):
I actually learned something interesting yesterday. Yeah. Do you have
the biggest export from Australia is boomerangs? Really it's also
the biggest import, that's true, wild, Yeah, Todd want to
talk to you a little bit about revocable trusts. Can
you give a quick simple explanation for similarities and differences
(23:54):
as it relates to someone doing their estate plan with
a revocable trust compared to a will.
Speaker 8 (23:59):
Yeah, so it it makes a big difference, I mean
just from a probate standpoints where you have to start
with that. But that's just really the tip of the iceberg, really,
because yeah, everybody wants to avoid probate, and you say,
why do I want to avoid probate, Well, it's a
big along process. And if you have a will, the
will absolutely will go to probate. It's the only estate
planning document that you must file at the probate court.
(24:22):
So we already know by having things governed by the
probate by the will means it's going to be governed
by the probate court. So a probate asset is first
defined as something you own in your own name and
it is not a designated beneficiary attached to it. So
if it's in your own name, no designated beneficiary, it's
(24:44):
going to probate. What's that A house, vacation home, a
rental property right. Iras generally have beneficiary, so you're probably
gonna luck out there. Jointly, how it accounts also will
avoid probate. Not great for est aid planning, but they
will avoid probate. And so those are the typical kinds
of own By the way, with probate assets, remember while
(25:06):
it's important to avoid probate just in general, house, vacation home,
rental properties, you know that vacation home might be in
another state, so we want to avoid probate. We also
want to avoid probate in every state. So when you
start talking about the need to avoid probate, you really
need to think about it when you've got real estate
because now you could be going and probating an ancillary
(25:27):
probate in any state that you have property in, so
really important to avoid it.
Speaker 2 (25:32):
That's the easy part.
Speaker 8 (25:34):
The second part is people come in and say, jeez, Todd,
I've done a will, I've got my estate plan all done. Well, no,
not really, because a wills won't is what I like
to say, meaning it won't do the following things, and
these might be important to you. Well, it won't avoid probate,
as we just explained, it won't likely reduce the state
(25:56):
taxes because it'll probably just say I leave everything to
my spouse and then my kids, so not avoiding estate taxes,
and it won't protect assets from a nursing home if
that's a concern of yours. So to me, there's three
major parts of an estate plan that are not covered
by a will, So a will's a won't. So I'm
thinking we now know the difference because if we set
(26:18):
up a trust, whether it's revocable or irrevocable, at least
we know it will avoid probate, it will shelter assets
for a state taxes, and it will protect assets from
a nursing home if it's irrevocable.
Speaker 2 (26:30):
Talking with Todd Lutsky from the law firm of Kushingen
Dolan segment is your chance to ask Todd your estate
planning questions. Studio line still open it eight eight eight
to zero five two two six'. Three that is the
number to call to Ask todd your estate planning questions
live on air right now again it's eight eight eight
(26:54):
to zero five two two six. Three still got room for,
you so again get calling it eight eight eight to
zero five two two sixty. Three we're going to take
a quick break, now but when we come. Back it's
going to be right to your questions With Todd lutsky.
Again that phone number is eight eight eight to zero
(27:14):
five two two six to.
Speaker 1 (27:17):
Three Ask todd With Todd lutsky Every wednesday at ten
thirty only here on The Financial Exchange Radio. Network you're
listening To Ask todd With Todd lutsky on The Financial
Exchange Radio.
Speaker 2 (27:31):
Network, alrighty let's get right to your calls With Todd.
Lutsky first in the, queue we've Got dave And. Melrose,
dave what's your question For?
Speaker 9 (27:47):
Todd good, morning. GENTLEMEN i have a question beguiding the
trust MONEY i have to. Trust, okay give you both
trust set up By. Todd thank, You. Todd you did
a great.
Speaker 8 (28:04):
Job you're checking the.
Speaker 2 (28:06):
Mail.
Speaker 9 (28:11):
WELL i just want to make Sure i'm not doing
anything wrong by having all my, income even Social security
this and, that you, know going to the trust and
then take it out into my personal account WHEN i
need it or AS i need. It but my idea
is it it'll if it's if if there's any IF
(28:33):
i don't use all the, money it stacks up in the,
trust and that's a good place for it to be
in terms of the nursing.
Speaker 8 (28:42):
Home so let me ask you just a couple of.
Questions so you said a couple of. Things that one
one is a little. Alarming but let me, so in
the trust you, have i'd imagine just some, investments, right, stocks, bonds, money, right.
Speaker 9 (28:54):
Plus income coming in Social i'm.
Speaker 8 (28:57):
Going to stop on that just for a, seconds just for. Now,
well the first question is you do have, stocks, bonds
and money that generates what we call interest and, dividends, right?
Correct so, okay So i'm going to address interests and
dividends as number one and number two social. Security, okay
those are the two items that really need to be.
Addressed this is a very important question for everybody. Listening
(29:18):
so you need to go back and look at my
engagement letter just to remind, you which we talked about
when we funded the. Trust the one ITEM i indicated
should never go in your trust is your personal bank.
Account your personal bank account that receives your social security
and pension for some, people should never be in the.
Trust so please stop that from. Happening because every single
(29:44):
time you deposit that social security check into that, trust
you start a five year waiting period for medicaid. Eligibility
so you do not ever want your Social security to
go into your trust that stays in your bank account
outside the. Trust, okay so you're going to need to
fix that asap if you want to just take the
(30:06):
account out or tell Social security to redirect the money
to an account that is not in the. Trust, now
the other, part interest and. Dividends the money you have
sitting in the trust regarding interest and, dividends absolutely love, it.
Right you can have that money in, there you can
have it, grow you can have capital gains, grow and
(30:27):
you can even have the interest and dividends kicked out
every month automatically to your personal account which is outside the,
trust which is now going to be that same account
that receives your Social. Security so as that money comes, out,
perfectly allowed to use it and live on. It but
as you, said you might, not you might want to
leave it in there, perfectly, okay if you want to
leave it in, there we have it's set up as
(30:48):
a grant or trust for income tax. Purposes so In,
english that means you're going to be able to continue
to pay the income taxes on that money at your
own personal, rate even if you don't take it. Out
so there's no tax problem for you leaving it in,
there and it's completely available for you if you choose
not to leave it in. There SO i like that
whole aspect of what you're. Doing and, again even if
(31:10):
it builds up in, there it doesn't. Matter it's an account,
receivable so you can always Take let's, say let's say
it builds up five thousand dollars a year that you're
are a month that you're not taken, out and they're
maybe you, know at the end of three months you
got fifteen thousand dollars in, There, well you can take
out fifteen thousand dollars if you need it for.
Speaker 2 (31:28):
Something because it's.
Speaker 8 (31:28):
Income it's an account, receivable it's not and it's not
added to, principle so it doesn't affect your five year waiting.
Period SO i think you're doing a great job on that.
Front just go fix That Social security account and have
it be paid to your personal, account not the. Trust
so hope that was helpful and hopeful it's helpful for everybody.
Listening folks want to tell you the new guide never
(31:53):
been given away. Before it's new for this month and
never be given away. Before it's really becoming much more
in vogue to do a simply joint revocable trust when
you do your. Planning why because of the new law
that passed keeping the estate tax exemptions. High this trust
allows you to cram down more assets than you could
(32:14):
if you divided assets between husband and, wife so you
can shelter more on the first death for estate tax.
Purposes you also get a full step up in basis
on the first, death so you win on that, front
and of course it'll play out to your family the
way you wanted. To, Folks this guide is all about
the simplicity of joint revocable. Trust learn how they work
(32:35):
and win on both the income tax side by getting
the step up in basis and the estate tax side
by cramming down more on the first death eight six
six eight four eight five six nine nine Or Legal
exchange show dot. Com you can download it there one
more time eight six six eight four eight five six
(32:57):
nine nine Or Legal Exchange show dot.
Speaker 2 (32:59):
Com todd got another one here for. You let's go
to al In. Marblehead, oh what's your question For? Todd good, morning.
Speaker 4 (33:07):
GUYS i have a question. Tried my neighbor's going into
a nursing home eighty nine years.
Speaker 9 (33:11):
Old they're in the.
Speaker 4 (33:13):
Butstal right, now and they've already asked for to fill
out A medicare for, Him Medica Medicaid, yeah, sorry, math excuse,
me math.
Speaker 2 (33:24):
Health it's the same, time.
Speaker 9 (33:25):
Okay and she.
Speaker 4 (33:27):
Went to the senior center in our local. Towne she's
sixty years, old she sort of, disabled she needs, help
and they they've filled out the form with. Her i'm very.
Concerned the house is actually in her. Name she didn't
have much. MONEY i don't know how she's going to live,
there but that's a different. Story but what my question
is he has about forty thousand in. Cash it was
(33:47):
in a joint account with her because she's an only,
child SO i always lived with them and the wife passed.
On what my question is is it a good idea
for just a senior center to BE i, MEAN i
thought the first time days medicare used to. Pay why
are they asking me to have this form filled belt
even before they go into these.
Speaker 8 (34:05):
Facilities, well because if we know we're going into a nursing, home,
right not an assisted, living but a nursing, home, right
we know that's where we're. Headed, yes you are, Right
medicare AND i wish they wouldn't use the same word
all the. Time But medicare will pay for the first hundred,
days but not always the first one hundred, days, right
(34:27):
it will pay up to one hundred. Days so if
you end up needing not skilled care, anymore then there is,
uh there's going to be a, cutoff, Right and you
want to be ready For medicaid to kick, in which
is a different payment, source, Right so you definitely want
to fill out the application because it's a.
Speaker 2 (34:48):
Process it takes.
Speaker 8 (34:49):
Time BUT i don't agree with you that they should
be using The Senior. Center no offense to The Senior,
center but this might be out of their, league and
AND i would say they should probably seek out a.
Speaker 2 (35:01):
Lawyer here's what should happen. Though if there's only forty grand.
Speaker 8 (35:05):
In a, house as long as the house is worth
less than a million, dollars And i'm guessing it, is it.
Is so if it's worth less than a million dollars and,
change then the house would be considered non countable when
you apply for. Medicaid, okay it's non countable as long
as you check a, box know what you're, doing fill
(35:25):
out the, application, Right they'll put a lien on, it
but it won't prevent you from becoming eligible For. Medicaid
so the forty, grand of course. Will but, again as
you're going through this, process we would be telling, them,
look why don't you take ten twelve thousand dollars in
pre pay a? Funeral want to cover? That that's perfectly all.
Right now you see we're whittling this. Down now we
(35:46):
got like twenty eight grand. Left all, Right, well, yeah
you're gonna hire a. Lawyer you're gonna have to pay the,
lawyer take some money out of, that, right is there
anything else you need to?
Speaker 1 (35:54):
Pay?
Speaker 8 (35:55):
Right and whittle that down a, little and then whatever is, Left,
okay IF i have TO i that pay the nursing
home for one, month you, Know i'm fine with, that,
right just to get the rest. Down but that's the
process of getting you eligible For, medicaid not just you,
know give all the money to the nursing home and then.
Apply but they should be able to get On medicaid
on their own in this. Case but JUST i think
(36:17):
they still might might want to try getting a lawyer
to help him out a. Little So todd got one
more for.
Speaker 2 (36:23):
You but we're gonna have to be. Quick jerry In,
vermont you've got about thirty seconds. Here what's your question For?
Todd thank?
Speaker 1 (36:30):
You?
Speaker 10 (36:31):
Mother elderly mother and nursing home without has a house
and nothing else, else and she's been told she has
to sell the house to pay for her.
Speaker 8 (36:42):
Bill, okay so great, question and sorry for that, situation of,
course but absolutely.
Speaker 2 (36:49):
Not you need to go get.
Speaker 8 (36:50):
Help you need to get someone to help her fill
out The medicaid. Application she's actually naturally. Eligible you don't
even need any fancy planning at this. Point but you
also don't need to pay fifty teen or sixteen thousand
dollars a month to the nursing home and sell the.
House you want to keep the, house check the box
that it's non. Countable get On. Medicaid it'll be a
much lower, rate so you're lean that runs up against
(37:13):
the house will be way smaller than. That plus you
still got the house. Right since someone passes, away you
get a step up in. Basis kids have an option
keep the house or sell. It no capital gains. Tax
sorry for the quick, answer but but just get some
help on. That they're going to be eligible For medicaid
the way it. Is don't sell The, House.
Speaker 2 (37:32):
Todd, lotski thank you so much for joining us. Today
always a. Pleasure thank.
Speaker 1 (37:35):
You this has been asked on on The Financial Exchange radio,
Network askedd With Todd leedskey has been presented By cushing And,
dolan Serving massachusetts And New england for more than thirty,
years helping families with the state and tax, Planning medicaid,
planning and probate. Law call eight hundred three nine three
four thousand and one or Visit cushingdolan dot. Com the
views expressed in this segment are solely those Of cushing And.
(37:57):
Dolan Armstrong advisory does not provide any segal or tax.
Advice please consult with your illegal or tax advisor on such.
Matters cushing And armstrong do not endorse each other and
are not affiliated
The Financial Exchange is produced by Money Matters Radio and
is hosted by employees of the Armstrong Advisory Group, a
registered investment advisor. All opinions expressed are solely those of
the hosts. Do not reflect the opinions of Armstrong Advisory
or anyone else. Investments can lose money. This program does
not offer any specific financial or investment advice. Please consult
your own financial, tax, and estate planning advisors before making
(00:20):
any investment decisions. Armstrong Advisory and the advertisers heard on
this program do not endorse each other or their services.
Armstrong and Money Matters Radio do not compensate each other
for referrals and are not affiliated. This is the Financial
Exchange with Chuck Zada and Mark fan Daddy, your exclusive
look at business and financial news affecting your day, your city,
(00:42):
your world. Stay informed and up to date about economic
and market trends, plus breaking business news every day. The
Financial Exchange is a proud partner of the Disabled American
Veterans Department of Massachusetts. Help us support our great American
heroes by visiting DAV five K dot Boston and making
a donation today. This is the Financial Exchange with Chuck
(01:05):
Zada and Mark Vandetti.
Speaker 2 (01:10):
Chuck Mark Tucker with you here on a Wednesday, and
we got a fun one lined up today. It is
in Nvidia earnings day. And anytime that you have I mean, look,
the best way to describe it in the context of
this market is anytime you have the largest company on
(01:31):
the planet reporting earnings and the options market for that
company projecting a seven percent move in either direction, well
you kind of got to wake up and pay attention
to it. So we'll have a little bit of discussion
on in Vidia also this afternoon. Not normally something that
(01:52):
I find interesting in any way, shape or form, but
we get FED meeting minutes, and I'm a little more
interested this time, partly because just the overall dearth of
you know, economic data that we've had, but also the
FED over the last couple of weeks, FED speakers have
indicated more, you know, more pushback against the idea of
December rate cut than I think I had anticipated. So
(02:13):
I'm interested to see what those meeting minutes may say.
And tomorrow we're going to be getting the September jobs report,
so we'll do a little bit of a preview of
what to expect there with some outdated jobs data that
is going to be gracing our computer screens at eight
thirty am tomorrow. So ultimately where we stand right now
(02:34):
is markets are you know, kind of at a point
where you know, there are some real questions that have
reared their heads in reared their heads sure in the
last month or so. The two big ones, in my
opinion read three big ones that are out there. Number
one the labor market. Is it continuing to slow? Number
(02:55):
two the private credit space. Is it going to be
a problem for the overall health of the financial system
or is it just you know, these few little blips
here and there that don't turn into anything big. And
third one in the artificial intelligence space, is the rate
of spending that we've seen projected into the future actually
(03:17):
going to be realized as that kapex starts to hit
financial statements over the next year or two in the
form of additional depreciation, Like at some point you actually
have to make money off this stuff, not just build it.
So this has caused a few wobbles and markets over
the last month or so, none of them particularly big.
(03:38):
I mean, even this last one at the open air
at the close of yesterday, it was like four and
a half percent, down from the all time highs that
we hit in October. Again, that's why I characterize these
as like little wobbles. But the question that you ask
on this is do little wobbles turn into something bigger?
And we're going to get you know, not the final land,
(04:00):
but we're gonna get in Vidio earnings today that can
tell us a little bit about what's going on with AI.
We'll get that jobs report tomorrow that'll tell us a
little bit about the labor market. And so I'm kind
of excited about what the next twenty four hours has
in store for us.
Speaker 3 (04:13):
That's great. So what are the big questions on people's minds?
You think, what's the stock market going to do next year?
Will it finish this year with a whimper or something
more impressive? What will it do next year? What will
economic growth be next year? We're on track for maybe
in line with trend economic growth this year about two percent.
(04:34):
We didn't get a GDP report for last.
Speaker 2 (04:36):
We think probably that range, which is not bad.
Speaker 3 (04:38):
It sounds weak relative to the last couple of years.
And we're talking real now, so inflation doesn't distort any
of these conclusions. Will it be stronger or weaker than trend.
And this year again it was choppy, but it was
about trend. Seemingly it about trend that we won't know
really for several months with all the revisions and stuff.
And then maybe related to that, unemployment. Is it gonna
(04:59):
hold steady word at about four point three according to
the last report. We'll get it updated ever later this week.
Will that go up or down? And then maybe some
people want to know about gas prices and prices particular
to the industry that they work in, or inputs that
they use for their company, stuff, stuff like that. But
I guess if you know the overall direction of the
(05:20):
rate of change is you like to talk about of
the direction of the economy's always growing, so on average
the rate of change is positive, But what is the
rate of change of the rate of change? Is it
going to pick up next?
Speaker 4 (05:29):
Sure is?
Speaker 3 (05:31):
Will it be zero? Will grow it about the same
rate as today? Or will it slow down? I don't
have answers to any of these questions. But some of
the news items that will come to fulfillment in the
next day or two or maybe week as the government
government data trickles in, will help us I think get
a better handle on what the answers to those questions might.
Speaker 2 (05:51):
Be, and so I think ultimately all markets, like all
bull markets, face challenges on a pretty regular or basis.
There's a reason why we say that volatility is a
feature of markets, not a bug. You have these questions
that get asked from time to time, and most of
the time they end up being resolved with, Okay, we had,
(06:13):
you know, a few bad days or maybe a bad week,
and markets fell you know, two to four percent, and
then the questions were answered satisfactorily enough and you move on.
Sometimes the questions linger a little bit longer, and you
end up with maybe a ten percent pullback, a market
correction as it's referred to, and you know, it might
take a month or so, maybe a couple months, and
(06:34):
you go through that ten percent correction, and then the
market gets a satisfactory answer and says, okay, I can
continue on and you know, resume you know, normal growth.
Other times, the market does not get a satisfactory answer,
and that's where you typically end up with bear markets,
which most of the time don't behave like the bear
markets that we saw in twenty twenty, which lasted for
(06:57):
all of you know, several weeks, or the one that
we saw this year that lasted for all of several months.
More often than not, bear markets tend to look like
twenty twenty two, where they can last for you know,
six months to a year, sometimes even a period of
multiple years if there's significant excess that needs to be unwound.
And that's because the questions are not answered satisfactorily, and
(07:19):
there's some pain that has to be felt in markets
by people that keep wanting them to be answered satisfactorily
even though they can't be. So the next you know,
six to eight weeks is about you know, starting to
find out, Hey, are these questions that you know? Number one?
Do they need to be answered right now? Sometimes the
answers just know you can't provide them and you need
(07:41):
to wait until later until you have more data. So
can they be answered right now? And if they can
be answered, do we get good answers the ones that
we want, or do we get bad answers that we
don't want but unfortunately sometimes have to say?
Speaker 3 (07:54):
Way, if Nvidia has a blowout report blowout the period
is the quarter right?
Speaker 2 (07:59):
Yes?
Speaker 3 (07:59):
Okay, they have a blowout quarter. Does that tell you
anything you didn't. Does that answer any of the questions
that to you are that are giving you heartburn right.
Speaker 2 (08:08):
Now about AI?
Speaker 3 (08:10):
Yeah, I don't think that's That's what I'm getting at.
Speaker 2 (08:11):
I don't think so in terms of their current quarter.
If their you know, future guidance is weaker than anticipated,
if they're you know, if they're trying to give revenue
guidance out further and it's not you know, what people anticipated,
that could be something that's.
Speaker 3 (08:26):
A concern, But how serious guys?
Speaker 2 (08:27):
Sorry, but quite honestly, the stuff that concerns people about
AI is not what was spent in the last quarter. Yeah,
it's what's going to be spent in like twenty twenty
eight through twenty thirty. And I just don't know how
great of an answer we can get on those questions
right now. I think they need to be answered probably
over the next twelve to eighteen months more likely.
Speaker 3 (08:48):
If there are real problems in credit markets. We've gotten some.
There are some disturbing tremors. They've yet to rerupt into
any thing major, but some indications that the the very
loose financial conditions for which I of course blamed the FED.
That's my eternal bumper sticker. Very loose financial conditions in
(09:10):
the past five years.
Speaker 2 (09:13):
I blame the FED.
Speaker 3 (09:14):
I that is a terrific idea Tucker.
Speaker 2 (09:17):
Can you get like financial exchange ones of those.
Speaker 3 (09:21):
And it doesn't matter what you're complaining about. You can
always conclude with you know, and Carthage must be destroyed,
as one of our moment ancestors like to say, and
the FED. You can always conclude your your your, you're fed,
you're Philippic with and the FED must be destroyed or
less radically, Yeah, maybe we don't want to threaten violence.
Speaker 2 (09:42):
No, I don't. I don't. I don't think it needs
to be you know, destroyed. He needed neither to. I think,
you know, And I blame the FED.
Speaker 3 (09:48):
Is just so very loose financial conditions, Chuck managers getting sloppy,
not doing their due diligence, not checking whether, say the
collateral was double pledged. As we've seen, there are a
lot of examples of this. Jamie Diamond, I think correctly
characterized it as cockroaches. We're gonna see more. Does that
(10:09):
suppose private suppose we have a credit crunch. Nvidia could
give the best looking forecast in the world today and
it's all irrelevant in six months if credit market sees
up again, yes, or even if they become less forgiving
than they are today.
Speaker 2 (10:24):
Yes. So I think that, in my opinion, like the
next six weeks, like the last six weeks of the year,
I don't know that you can get satisfactory answers to
put these things to bed.
Speaker 3 (10:37):
No, that's kind of what I'm trying to say.
Speaker 2 (10:38):
But you also might not need them because the market
might just say, Okay, these are things to worry about
in twenty six and let's have one last rally in
twenty five before you know, before we reckon with them.
So that can be an answer that you get as well.
Let's take a quick break and when we return, I
want to talk a little bit more about private credit,
and then we'll do some discussion of target earned as well.
Speaker 1 (11:02):
Missed one of our shows. Catch up anytime by asking
your Alexis Smart speaker to play the Financial Exchange. This
is the Financial Exchange Radio Network. Find daily interviews and
full shows of the Financial Exchange on our YouTube page.
Like us on YouTube and get caught up on anything
and everything you might have missed. This is the Financial
Exchange Radio Network.
Speaker 5 (11:33):
This segment of The financial exchange is brought to you
by the US Virgin Islands Department of Tourism. Your next
incredible vacation is a click away, and if you act fast,
you could be in Sant Croix to experience their Crucian
Christmas Festival taking place this December through early January. Discover
the magic of this long standing tradition with incredible food,
music and entertainment. Or just go soak up the sun,
(11:56):
stroll on white sand beaches and feel the rhythm of
the heartbeat of the island's The USVII is America's Caribbean paradise.
Plan your escape now at visit USVII dot com. That's
visit USVII dot com.
Speaker 2 (12:09):
Jamie Diamond asked back in October about the concerns in
the private credit market after the bankruptcies of Tricolor and
First Brands, said, Hey, look, usually when you see a cockroach,
there's generally others, and that then prompted Blue Owl CEO.
Blue Owl is a big asset manager who runs a huge,
(12:30):
you know, business in that private credit and private equity space,
and the Blue Owl CEO said, like, basically, in no
uncertain terms, Jamie Diamond, should you know, stick to his
own business, like we'll we'll do ours, and you know,
that was that. And then over the weekend, blue Owl
came out. It came out The Financial Times reported that
(12:50):
Blue Owl was trying to take one of their private
credit funds and merge it into a publicly traded fund,
giving investors in the private held one a twenty percent
haircut in the process. Subsequently, this morning, following the outrage
from investors over the last several days, Blue Owl has
said no, we're not actually gonna do that, and we'll
(13:12):
figure out a way to meet redemptions in the January
quarter instead. But Blue Owl didn't make the decision to
try to merge those funds just because they thought it
was like, hey, this is happy and great. They did
it because out of necessity, they couldn't meet redemptions that
were being requested at the prices that were being requested.
Speaker 3 (13:35):
Private markets are very different than public markets. When you
get into them, you don't know what they're gonna buy.
That's the whole point. It's kind of a blind trust.
You give a manager money. If your pension fund you
commit that's in the language of private markets, you commit
twenty million dollars to Armstrong fund. And this's a bad
exampleation to XYZ folk.
Speaker 6 (13:52):
We don't do that, by the.
Speaker 3 (13:52):
Way, but if we did, it would be x y
Z fund two because we had a one and it
was great, and now everybody wants in our fund too.
So a pension fund or an endowment, we'll commit twenty million.
You don't know what they're going to invest. You also
don't know what it's worth. They make educated guesses. Auditors
help them with this periodically for the roughly ten year
period during which you're invested, but you don't know. It's
(14:13):
quite opaque. That's why the returns have been generous relative
to public markets for a select few, very skilled private
market investors. And I put Blue Owl and some of
the others that you hear about Aries and Blackstone.
Speaker 2 (14:25):
There's a reason why they're as big as there. I mean,
Blue OU's a three billion dollar assets. They've generally been
skilly good at what they've done, and they've had some
favorable tail winds for the last decades in that market
as well.
Speaker 3 (14:37):
You cannot overlook that. So this is to be expected
if if you, as an individual investor, get into private markets.
Keep in mind you don't know what you're buying, and
that's okay. That's the nature of it. There's nothing sinister
about it. You don't really know what it's worth. That's
okay too. That's sort of what allows private markets to
be private market managers to be nimble and to effect
changes in the firms that they buy, as distinguished from
(14:58):
public markets, where you're really just a long the ride
and you don't know how long the investment's going to
take to come to fruition. Either private market managers can
extend the term of their funds or through other accounting machinations,
and I don't mean that in a negative way, give
their underlying investments more time to work out. It's just
a very different beast chuck in the idea of this
(15:18):
stuff going into a four h one k, even if
it's supervised by a diligent professional investment consultant something like that,
or someone who advises these four h one K funds,
I still wonder how the opacity and the very very
long term nature it's gonna sit with investors and a
couple different things.
Speaker 2 (15:37):
The first is, like earlier this year was when you've
really seen the push to try to get private assets
into four and k plans picked up, and quite honestly,
given what's coming out now, and I said this at
the time, I'm like, look, these companies have made an
awful lot of money by being exclusive to the high
net worth and institutional investor. The only reason they go
(15:59):
down market is generally because they've run out of, you know,
ways to raise money from those other types of investors
and they want someone else to kind of be that
next wave of liquidity. And this has done nothing to
dissuade me from that. Like, not quite the opposite. Blue
Owl does not want to deal with Jimmy, you know,
Q Public sticking fifty dollars a month into his four
(16:19):
to h one k.
Speaker 3 (16:20):
Plan and Blue Owl never will. They're hiring intermediaries, correct,
But the reason that they're doing that is because they're
not getting the money coming in that they want to
from other.
Speaker 2 (16:29):
Sources now or there.
Speaker 3 (16:31):
You know, there's about five hundred and fifty billion and
I'm not giving you a reference point, but trust me,
this is a lot of dry powder in private debt alone.
Dry powder means a pension fund is said, we'll give
you the money, but it hasn't been called away from
the pension fund yet because the manager hasn't had trouble
with an opportunity, I don't. It boggles the mind to
me anyway, why they need more They're sitting on way
(16:53):
and this is true, a venture cap moving over to
equity now it's true.
Speaker 2 (16:56):
Of it doesn't make me feel good as to why.
Speaker 3 (16:59):
Maybe, well, we know why, I mean, we know.
Speaker 2 (17:03):
So there's this and then this whole move from blue
out over the last couple of you know, over the
last week. Call it, I gotta be honest. It gives
me flashbacks to the summer of two thousand and seven
with Lehmann trying to shuffle you know, money around its
you know, mortgage backed securities funds in order to keep
(17:24):
the plate spinning like It gives me real flashbacks to
that Mark Well.
Speaker 3 (17:29):
The fact that if this was caused by i'll just
call it a run, a run on the fund, A
bunch of people went in said we want our money.
They threw up so called gates. Now I'm bringing hedge
fund language into this. But the problem this is a
better visual imagine everybody gets concerned about private credit this.
Speaker 2 (17:43):
It wasn't even everyone. It was six pen They receive
redemptions for about six percent of assets in the fund.
This stuff is.
Speaker 3 (17:49):
So inherently liquid and there's nothing again sinister about that.
It's the nature of the asset class that if indeed
people run for the there's no running for the exits
in private markets, much like there isn't with anything.
Speaker 2 (18:00):
Are not entitled to it anything.
Speaker 3 (18:03):
You're right, It is in the documents, it's in the contracts,
and this is true hedge funds too. They throw up
gates and like you said, there were instances of this
in six seven leading up to the crisis. They didn't
precipitate it, but sometimes they can be warning signs.
Speaker 2 (18:16):
So it just gives me a little bit of an
ugly feeling about it and worthy of further monitoring. Just
because this stuff doesn't happen when everything is hunky dory,
it still can be that this doesn't cause any major
issues in markets because it's not big enough to But
my antenna are fully up on this and paying attention
(18:38):
at least.
Speaker 3 (18:39):
Couple this with the alleged fraud. This is a different fun,
different management, different sub asset class, but other pieces of
evidence that very loose conditions over the past several years,
and you'll be shocked to find out I blame the
FED for those have precipitated larger concerns. Carelessness, laxity, and
lending has led to potentially larger concerns.
Speaker 2 (19:00):
So worth monitoring. Oh yeah, has the potential to cause
some real issues in twenty six. Yep, maybe we skate
through somehow, but this is something worth watching. And this,
by the way, has been a decade in the making. Like,
this is not something that you just woke up to
this year. This is something where the seeds of this
were sown in the mid twenty tens and maybe reaped
(19:23):
in the mid twenty twenty. Yes, let's take a quick
break here. When we return, it's Wall Street, Watch and
ask Todd.
Speaker 1 (19:40):
Like us on Facebook and follow us on Twitter at
TFE show. Breaking business news is always first right here
on the Financial Exchange Radio Network.
Speaker 6 (19:50):
We're proud to announce that circle K is now the official.
Speaker 7 (19:53):
Convenience store of the dav Department of Massachusetts. At circle K,
Supporting those who bravely served our country isn't a commitment,
it's a heartfelt mission. Circle K is honored to stand
with the dav Department of Massachusetts to ensure that.
Speaker 6 (20:06):
Veterans receive the care and recognition they deserve.
Speaker 7 (20:09):
If you'd like to do your part, please visit DAVMA
dot org.
Speaker 6 (20:13):
Thank you for standing with Circle K and the dav
Department of.
Speaker 7 (20:16):
Massachusetts, and thank you veterans for all you've done.
Speaker 1 (20:21):
Time now for Wall Street. Watch a complete look at
what's moving markets so far today right here on the
Financial Exchange, Radio Network.
Speaker 5 (20:30):
And video days upon US where the AI and Shift
Giant will report their highly anticipated third quarter earnings after
today's close, and Video stock is up over three percent
ahead of its earnings. As for markets right now, the
Dow is up about a quarter percent, or one hundred
and seven points, SMP five hundred is up over nine
tenths of a percent or sixty one points, Hired NASDAC
(20:52):
up about one and a half percent or three hundred
and twenty nine points, Russell two thousand and up over
one percent, ten Your treasure Field is flat at four
point one two nine percent, and crude oiled down nearly
three percent today, trading just above fifty nine.
Speaker 6 (21:07):
Dollars a barrel.
Speaker 5 (21:09):
More retailer earnings this morning after Target reported a decline
in third quarter sales as the company saw it shoppy
spending in shoppers hunting four value. Target also cut its
annual profit outlook and said it would invest billions to
upgrade stores to help lift sales. Target shares are down
over half a percent. Meanwhile, Low's is up by four
percent after the retailer b third quarter expectations, where its
(21:32):
online business helped offset weakness in the home improvement sector.
One other retailer to report, where TJX posted better than
expected earnings in revenue estimates. The parent company two tj
Max and Marshall's lifted its annual outlook again as it
continues to win over inflation weary shoppers. TJX shares are
(21:53):
up over one percent, Alphabet jumping six percent one day
after Google launched its updated Gemini AI motl Separately, Loop
Capital upgraded the stock to buy from holding, upped its
price target, and Constellation Andrew stock is climbing nearly six
percent after the company received a one billion dollar loan
from the government to restart its Crane clean energy nuclear plants.
(22:16):
I'm Tucker Silva in That is Wall Street Watch.
Speaker 1 (22:20):
This is ask Todd on the Financial Exchange Radio network.
If you have an existing estate plan or in the
market for one, Todd Lutsky is here to answer your
questions and help you plan for a later life. Ask
Todd is presented by Cushing and Dolan, serving Massachusetts and
New England for more than thirty five years, helping families
with a state and tax planning, Medicaid planning, and probate law.
(22:42):
Visit Cushingdolan dot com. Now here's Todd Lutsky.
Speaker 2 (22:47):
And we do have Todd Lutsky with us right now
for Ask Todd. Phone lines are wide open for you.
Get those fingers dial in eight eight eight two zero
five two two sixty three. That is the number to
call to Ask Todd your estate planning questions live on air. Again.
Eight eight eight to zero five two two six three
(23:10):
is the number. We usually get two to three calls
that we can get through. To make sure you call
early and often in order to get in line. That
phone number again is eight eight eight two zero five
two two six three. Mister Lotsky, how you doing? I'm
doing great.
Speaker 8 (23:29):
I'm afraid to ask you.
Speaker 2 (23:31):
I actually learned something interesting yesterday. Yeah. Do you have
the biggest export from Australia is boomerangs? Really it's also
the biggest import, that's true, wild, Yeah, Todd want to
talk to you a little bit about revocable trusts. Can
you give a quick simple explanation for similarities and differences
(23:54):
as it relates to someone doing their estate plan with
a revocable trust compared to a will.
Speaker 8 (23:59):
Yeah, so it it makes a big difference, I mean
just from a probate standpoints where you have to start
with that. But that's just really the tip of the iceberg, really,
because yeah, everybody wants to avoid probate, and you say,
why do I want to avoid probate, Well, it's a
big along process. And if you have a will, the
will absolutely will go to probate. It's the only estate
planning document that you must file at the probate court.
(24:22):
So we already know by having things governed by the
probate by the will means it's going to be governed
by the probate court. So a probate asset is first
defined as something you own in your own name and
it is not a designated beneficiary attached to it. So
if it's in your own name, no designated beneficiary, it's
(24:44):
going to probate. What's that A house, vacation home, a
rental property right. Iras generally have beneficiary, so you're probably
gonna luck out there. Jointly, how it accounts also will
avoid probate. Not great for est aid planning, but they
will avoid probate. And so those are the typical kinds
of own By the way, with probate assets, remember while
(25:06):
it's important to avoid probate just in general, house, vacation home,
rental properties, you know that vacation home might be in
another state, so we want to avoid probate. We also
want to avoid probate in every state. So when you
start talking about the need to avoid probate, you really
need to think about it when you've got real estate
because now you could be going and probating an ancillary
(25:27):
probate in any state that you have property in, so
really important to avoid it.
Speaker 2 (25:32):
That's the easy part.
Speaker 8 (25:34):
The second part is people come in and say, jeez, Todd,
I've done a will, I've got my estate plan all done. Well, no,
not really, because a wills won't is what I like
to say, meaning it won't do the following things, and
these might be important to you. Well, it won't avoid probate,
as we just explained, it won't likely reduce the state
(25:56):
taxes because it'll probably just say I leave everything to
my spouse and then my kids, so not avoiding estate taxes,
and it won't protect assets from a nursing home if
that's a concern of yours. So to me, there's three
major parts of an estate plan that are not covered
by a will, So a will's a won't. So I'm
thinking we now know the difference because if we set
(26:18):
up a trust, whether it's revocable or irrevocable, at least
we know it will avoid probate, it will shelter assets
for a state taxes, and it will protect assets from
a nursing home if it's irrevocable.
Speaker 2 (26:30):
Talking with Todd Lutsky from the law firm of Kushingen
Dolan segment is your chance to ask Todd your estate
planning questions. Studio line still open it eight eight eight
to zero five two two six'. Three that is the
number to call to Ask todd your estate planning questions
live on air right now again it's eight eight eight
(26:54):
to zero five two two six. Three still got room for,
you so again get calling it eight eight eight to
zero five two two sixty. Three we're going to take
a quick break, now but when we come. Back it's
going to be right to your questions With Todd lutsky.
Again that phone number is eight eight eight to zero
(27:14):
five two two six to.
Speaker 1 (27:17):
Three Ask todd With Todd lutsky Every wednesday at ten
thirty only here on The Financial Exchange Radio. Network you're
listening To Ask todd With Todd lutsky on The Financial
Exchange Radio.
Speaker 2 (27:31):
Network, alrighty let's get right to your calls With Todd.
Lutsky first in the, queue we've Got dave And. Melrose,
dave what's your question For?
Speaker 9 (27:47):
Todd good, morning. GENTLEMEN i have a question beguiding the
trust MONEY i have to. Trust, okay give you both
trust set up By. Todd thank, You. Todd you did
a great.
Speaker 8 (28:04):
Job you're checking the.
Speaker 2 (28:06):
Mail.
Speaker 9 (28:11):
WELL i just want to make Sure i'm not doing
anything wrong by having all my, income even Social security
this and, that you, know going to the trust and
then take it out into my personal account WHEN i
need it or AS i need. It but my idea
is it it'll if it's if if there's any IF
(28:33):
i don't use all the, money it stacks up in the,
trust and that's a good place for it to be
in terms of the nursing.
Speaker 8 (28:42):
Home so let me ask you just a couple of.
Questions so you said a couple of. Things that one
one is a little. Alarming but let me, so in
the trust you, have i'd imagine just some, investments, right, stocks, bonds, money, right.
Speaker 9 (28:54):
Plus income coming in Social i'm.
Speaker 8 (28:57):
Going to stop on that just for a, seconds just for. Now,
well the first question is you do have, stocks, bonds
and money that generates what we call interest and, dividends, right?
Correct so, okay So i'm going to address interests and
dividends as number one and number two social. Security, okay
those are the two items that really need to be.
Addressed this is a very important question for everybody. Listening
(29:18):
so you need to go back and look at my
engagement letter just to remind, you which we talked about
when we funded the. Trust the one ITEM i indicated
should never go in your trust is your personal bank.
Account your personal bank account that receives your social security
and pension for some, people should never be in the.
Trust so please stop that from. Happening because every single
(29:44):
time you deposit that social security check into that, trust
you start a five year waiting period for medicaid. Eligibility
so you do not ever want your Social security to
go into your trust that stays in your bank account
outside the. Trust, okay so you're going to need to
fix that asap if you want to just take the
(30:06):
account out or tell Social security to redirect the money
to an account that is not in the. Trust, now
the other, part interest and. Dividends the money you have
sitting in the trust regarding interest and, dividends absolutely love, it.
Right you can have that money in, there you can
have it, grow you can have capital gains, grow and
(30:27):
you can even have the interest and dividends kicked out
every month automatically to your personal account which is outside the,
trust which is now going to be that same account
that receives your Social. Security so as that money comes, out,
perfectly allowed to use it and live on. It but
as you, said you might, not you might want to
leave it in there, perfectly, okay if you want to
leave it in, there we have it's set up as
(30:48):
a grant or trust for income tax. Purposes so In,
english that means you're going to be able to continue
to pay the income taxes on that money at your
own personal, rate even if you don't take it. Out
so there's no tax problem for you leaving it in,
there and it's completely available for you if you choose
not to leave it in. There SO i like that
whole aspect of what you're. Doing and, again even if
(31:10):
it builds up in, there it doesn't. Matter it's an account,
receivable so you can always Take let's, say let's say
it builds up five thousand dollars a year that you're
are a month that you're not taken, out and they're
maybe you, know at the end of three months you
got fifteen thousand dollars in, There, well you can take
out fifteen thousand dollars if you need it for.
Speaker 2 (31:28):
Something because it's.
Speaker 8 (31:28):
Income it's an account, receivable it's not and it's not
added to, principle so it doesn't affect your five year waiting.
Period SO i think you're doing a great job on that.
Front just go fix That Social security account and have
it be paid to your personal, account not the. Trust
so hope that was helpful and hopeful it's helpful for everybody.
Listening folks want to tell you the new guide never
(31:53):
been given away. Before it's new for this month and
never be given away. Before it's really becoming much more
in vogue to do a simply joint revocable trust when
you do your. Planning why because of the new law
that passed keeping the estate tax exemptions. High this trust
allows you to cram down more assets than you could
(32:14):
if you divided assets between husband and, wife so you
can shelter more on the first death for estate tax.
Purposes you also get a full step up in basis
on the first, death so you win on that, front
and of course it'll play out to your family the
way you wanted. To, Folks this guide is all about
the simplicity of joint revocable. Trust learn how they work
(32:35):
and win on both the income tax side by getting
the step up in basis and the estate tax side
by cramming down more on the first death eight six
six eight four eight five six nine nine Or Legal
exchange show dot. Com you can download it there one
more time eight six six eight four eight five six
(32:57):
nine nine Or Legal Exchange show dot.
Speaker 2 (32:59):
Com todd got another one here for. You let's go
to al In. Marblehead, oh what's your question For? Todd good, morning.
Speaker 4 (33:07):
GUYS i have a question. Tried my neighbor's going into
a nursing home eighty nine years.
Speaker 9 (33:11):
Old they're in the.
Speaker 4 (33:13):
Butstal right, now and they've already asked for to fill
out A medicare for, Him Medica Medicaid, yeah, sorry, math excuse,
me math.
Speaker 2 (33:24):
Health it's the same, time.
Speaker 9 (33:25):
Okay and she.
Speaker 4 (33:27):
Went to the senior center in our local. Towne she's
sixty years, old she sort of, disabled she needs, help
and they they've filled out the form with. Her i'm very.
Concerned the house is actually in her. Name she didn't
have much. MONEY i don't know how she's going to live,
there but that's a different. Story but what my question
is he has about forty thousand in. Cash it was
(33:47):
in a joint account with her because she's an only,
child SO i always lived with them and the wife passed.
On what my question is is it a good idea
for just a senior center to BE i, MEAN i
thought the first time days medicare used to. Pay why
are they asking me to have this form filled belt
even before they go into these.
Speaker 8 (34:05):
Facilities, well because if we know we're going into a nursing, home,
right not an assisted, living but a nursing, home, right
we know that's where we're. Headed, yes you are, Right
medicare AND i wish they wouldn't use the same word
all the. Time But medicare will pay for the first hundred,
days but not always the first one hundred, days, right
(34:27):
it will pay up to one hundred. Days so if
you end up needing not skilled care, anymore then there is,
uh there's going to be a, cutoff, Right and you
want to be ready For medicaid to kick, in which
is a different payment, source, Right so you definitely want
to fill out the application because it's a.
Speaker 2 (34:48):
Process it takes.
Speaker 8 (34:49):
Time BUT i don't agree with you that they should
be using The Senior. Center no offense to The Senior,
center but this might be out of their, league and
AND i would say they should probably seek out a.
Speaker 2 (35:01):
Lawyer here's what should happen. Though if there's only forty grand.
Speaker 8 (35:05):
In a, house as long as the house is worth
less than a million, dollars And i'm guessing it, is it.
Is so if it's worth less than a million dollars and,
change then the house would be considered non countable when
you apply for. Medicaid, okay it's non countable as long
as you check a, box know what you're, doing fill
(35:25):
out the, application, Right they'll put a lien on, it
but it won't prevent you from becoming eligible For. Medicaid
so the forty, grand of course. Will but, again as
you're going through this, process we would be telling, them,
look why don't you take ten twelve thousand dollars in
pre pay a? Funeral want to cover? That that's perfectly all.
Right now you see we're whittling this. Down now we
(35:46):
got like twenty eight grand. Left all, Right, well, yeah
you're gonna hire a. Lawyer you're gonna have to pay the,
lawyer take some money out of, that, right is there
anything else you need to?
Speaker 1 (35:54):
Pay?
Speaker 8 (35:55):
Right and whittle that down a, little and then whatever is, Left,
okay IF i have TO i that pay the nursing
home for one, month you, Know i'm fine with, that,
right just to get the rest. Down but that's the
process of getting you eligible For, medicaid not just you,
know give all the money to the nursing home and then.
Apply but they should be able to get On medicaid
on their own in this. Case but JUST i think
(36:17):
they still might might want to try getting a lawyer
to help him out a. Little So todd got one
more for.
Speaker 2 (36:23):
You but we're gonna have to be. Quick jerry In,
vermont you've got about thirty seconds. Here what's your question For?
Todd thank?
Speaker 1 (36:30):
You?
Speaker 10 (36:31):
Mother elderly mother and nursing home without has a house
and nothing else, else and she's been told she has
to sell the house to pay for her.
Speaker 8 (36:42):
Bill, okay so great, question and sorry for that, situation of,
course but absolutely.
Speaker 2 (36:49):
Not you need to go get.
Speaker 8 (36:50):
Help you need to get someone to help her fill
out The medicaid. Application she's actually naturally. Eligible you don't
even need any fancy planning at this. Point but you
also don't need to pay fifty teen or sixteen thousand
dollars a month to the nursing home and sell the.
House you want to keep the, house check the box
that it's non. Countable get On. Medicaid it'll be a
much lower, rate so you're lean that runs up against
(37:13):
the house will be way smaller than. That plus you
still got the house. Right since someone passes, away you
get a step up in. Basis kids have an option
keep the house or sell. It no capital gains. Tax
sorry for the quick, answer but but just get some
help on. That they're going to be eligible For medicaid
the way it. Is don't sell The, House.
Speaker 2 (37:32):
Todd, lotski thank you so much for joining us. Today
always a. Pleasure thank.
Speaker 1 (37:35):
You this has been asked on on The Financial Exchange radio,
Network askedd With Todd leedskey has been presented By cushing And,
dolan Serving massachusetts And New england for more than thirty,
years helping families with the state and tax, Planning medicaid,
planning and probate. Law call eight hundred three nine three
four thousand and one or Visit cushingdolan dot. Com the
views expressed in this segment are solely those Of cushing And.
(37:57):
Dolan Armstrong advisory does not provide any segal or tax.
Advice please consult with your illegal or tax advisor on such.
Matters cushing And armstrong do not endorse each other and
are not affiliated
Popular Podcasts
Las Culturistas with Matt Rogers and Bowen Yang
Ding dong! Join your culture consultants, Matt Rogers and Bowen Yang, on an unforgettable journey into the beating heart of CULTURE. Alongside sizzling special guests, they GET INTO the hottest pop-culture moments of the day and the formative cultural experiences that turned them into Culturistas. Produced by the Big Money Players Network and iHeartRadio.
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.