May 7, 2026 • 38 mins
Despite nonstop warnings about AI replacing workers, the labor market is telling a very different story.
Chuck Zodda and Mike Armstrong break down why tech layoffs may have more to do with pandemic overhiring than artificial intelligence, as new data shows parts of the job market beginning to stabilize again.
Also covered:
Chuck Zodda and Mike Armstrong break down why tech layoffs may have more to do with pandemic overhiring than artificial intelligence, as new data shows parts of the job market beginning to stabilize again.
Also covered:
- Why software developer job openings are rising again
- The biggest bottleneck preventing AI from replacing workers right now
- How companies are using “AI efficiency” to justify layoffs
- Why ChatGPT is becoming the new storefront for major brands
- The surprising comeback of hacky sack in American schools
- Why some renters are skipping starter homes to buy vacation properties instead
- The growing rivalry between OpenAI, Anthropic, and Elon Musk’s xAI
- Why EV drivers suddenly feel smarter than everyone else at the gas pump
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
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(00:20):
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(00:42):
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(01:05):
Chuck Zadith and Mike Armstrong.
Speaker 2 (01:11):
Chuck, Mike, and soccer with you, and as we kick
things off here, we've got stocks drifting modestly upward on
a couple of the major indices. But the Dow is
off twenty two points right now, while the S and
P's up twelve nas that can posite up one hundred
and thirty one. We've got the US ten year treasury
basically flat, down eight tenths of a basis point today
(01:32):
to four point three four six percent. Taking a look
at mortgage rates, they've come back in his rates have
come down in the last couple of days, back down
to six point four to four percent after being north
of six and a half for you know, the beginning
part of the week.
Speaker 3 (01:48):
Uh.
Speaker 2 (01:48):
Taking a look through other markets, Dollar Index down point
one seven percent to ninety seven to seven oh five,
and gold up another seventy six point thirty trying to
make a rally after just choppy trading the last couple months,
but back up to forty seven to seventy one right now.
Speaker 4 (02:04):
And crude oil.
Speaker 2 (02:05):
West Text Intermediate down another three ninety nine a barrel
to ninety one oh nine trip a national average for
gas prices is up another let's see we get up
another half, sorry, up another two point two cents to
four fifty five and eight tenths. If you're wondering on
the divergence, there a couple things. The first is there
(02:26):
is always a little.
Speaker 4 (02:27):
Bit of a delay.
Speaker 2 (02:27):
Remember those oil prices just started falling yesterday. But also
those oil prices are oil futures. For in the case
of West Text Intermediate, you are looking at the June contract.
Speaker 4 (02:41):
If someone is getting.
Speaker 2 (02:42):
A barrel delivered today, it is a different price for
either crude or finished product than what you were seeing.
And remember finished product also includes, you know, additional costs.
There is a spread that refiners make and what you
are seeing on those what they're called is cracks. Those
crack spreads are running, you know, two or three times
(03:03):
what they normally are because of demand for finished product
in the market. So it wouldn't be entirely unexpected here
if you saw a little bit of a divergence build
between crude futures pricing and gas pricing right now based
on combination that's spread and you know, other factors related
(03:24):
to gas futures also diverging a little bit from crude.
So You've got some different pieces that are moving here,
but ultimately we could see maybe a ten to fifteen
cent relief on prices at the pump if prices were
to hold here in the coming four to five days.
We'll see where we go.
Speaker 4 (03:45):
Anything else catching your eye, Mike.
Speaker 3 (03:47):
No, mortgage rates obviously remaining elevated in that six and
a half percent range, and we're seeing it reflected in
the housing market so far this year with just activity
being a little bit lackluster.
Speaker 2 (04:00):
Let's talk about this piece in the Wall Street Journal.
Corporate layoffs are down ten percent this year, but the
AI reckoning has come for tech, And I gotta be honest,
this is kind of a garbage piece.
Speaker 3 (04:12):
So my favorite part of it, though, Chuck, is when
they talk about these corporate layoffs being down ten percent,
but the AI reckoning has come for tech. They've got
this beautiful visual of a bunch of circles indicating how
big the layoffs have been, and two of them include
UPS and Heineken, Well and Dows.
Speaker 2 (04:33):
In here like Dow Chemicals in here, Morgan Stanley's another one.
Speaker 3 (04:37):
Yeah, they're all in the list, but even the graphical image,
they included UPS and heine when talking about the tech
are in the graphic too, they are okay, yeah, yeah.
Speaker 2 (04:46):
Like they're all in there, So these are not tech
layoffs that are in there. And I gotta be honest,
this doesn't Okay, here's the deal. If you actually take
a look at what we are seeing from and this
is from indeed, so it's again private data that we
are seeing here. Software development job postings are now up
(05:10):
fourteen percent year over year. Did you know that, Michael No?
Speaker 4 (05:15):
I did not.
Speaker 2 (05:16):
I didn't either until a good friend, well not really
a good friend, but I follow him on social media.
Gey Berger had he goes through all of the data
on a regular basis and he's like, yeah, software was
basically in the wilderness until a few months ago, and
now you've had a bunch of software positions that have
opened recently, and so year over year you've got you know,
(05:40):
software developer job opening growth. And remember openings typically lead hiring.
What's going on in big tech, Mike. The companies that
are laying off tons of people they over hired during
the pandemic and now they're trying to get back to
their you know, appropriate size headcount. In my opinion, Yeah,
by the way.
Speaker 3 (06:00):
If they can do it at the same time as
you know, AI washing it by saying that their employees
are far more efficient, then their stop price gets rewarded too,
So you've got this double incentive to do all of this.
Speaker 2 (06:15):
So I'll make the case right now from what we've
seen so far. Again, we got a jobs report tomorrow,
but based on the aggregate data that we've seen for
the first three and a quarter months of the year,
because again we just don't have a ton from April yet,
the job market has not worsened any further, and might,
(06:38):
actually I'll even go past might, there are parts of
the job market that are showing green shoots now for
renewed growth as we enter into the spring. I'll like,
I think that if you are looking at the job
market honestly, and I try to, because for the second
half of last year I said, guys, we've got a problem,
(06:58):
like something is really you know, trending in.
Speaker 4 (07:01):
The wrong direction in the job market.
Speaker 2 (07:04):
Got to be honest, the last three to four months
you have absolutely seen a turn that at the very
least indicate that that downward momentum is stopped, and in
a number of places are indicating that you've got some
positive momentum that's beginning.
Speaker 5 (07:19):
So what is this again?
Speaker 3 (07:22):
This piece, I think is just buying into the the
overdone fear that AI is coming for the labor market
in twenty twenty six. And it's not to say that
it won't ever. I think there is this risk it
won't in twenty six. Yeah, I think there is that far.
There's this risk out there in my view, where there's
(07:46):
kind of two extreme paths that I can look at
with AI. One would be where this technology continues to
develop at such a fast pace like it has over
the last couple of years that it does eventually disrupt
a whole bunch of jobs, and because it developed so fast,
there's not new jobs coming to replace that immediately. It
takes a few years for the labor market to kind
(08:07):
of recover itself.
Speaker 5 (08:08):
In that case.
Speaker 3 (08:10):
The other path, which is another extreme, is it kind
of follows the path of the Internet, where big gains
were made right up front, and then those gains slowed
down considerably and what you were left with was a
bunch of companies trying to figure out how to monetize
the new technology, a bunch of companies that had overspent
on developing the technology, and you ended up not with
(08:33):
a labor market problem due to the Internet, but rather
a stock market problem because everybody was betting that it
was going to be bigger than it wound up being.
So yeah, it's not to say that there can't be
problems from for the labor market from AI, and it's
not to say that specific jobs are already being disrupted
by AI, but the idea that it's leading to higher
(08:54):
unemployment and layoffs in twenty twenty six is there's just.
Speaker 2 (08:59):
No evidence beyond that. I'll put one other thing on
the table, is why you're not going to see it
become a meaningful problem in twenty twenty six. Mike, what's
the biggest problem with artificial intelligence as it relates to
its use in the workplace right now?
Speaker 5 (09:15):
Privacy and security? No, No, that.
Speaker 4 (09:19):
Might be in our industry, but in general, just live
it too much.
Speaker 5 (09:21):
I don't know.
Speaker 2 (09:23):
There's not enough capacity, Yeah, Mike, how are you going
to displace jobs if you are being rate limited in
terms of how much you can actually do with AI?
Speaker 4 (09:32):
Right now?
Speaker 5 (09:33):
Yeah, it's fair.
Speaker 3 (09:34):
You got to pay an immense amount of money if
you actually want the capacity to do something impressive with it.
Speaker 2 (09:39):
So I think that you absolutely don't have enough compute
capacity for it to displace any meaningful number of jobs
this year and change the trajectory of the labor force
as a result of it. It's not to say that
we won't get to a point in the future where
that becomes the case, but this year. Talk to anyone
who uses you know, COUD, which is now seen. I
think it's seen in I believe eightyfold increases what their
(10:02):
CEO said in activity over the last five months.
Speaker 4 (10:06):
They can't use enough.
Speaker 2 (10:08):
They keep getting like booted out of the system because
they've used too much of their compute capacity. They're rationing
the compute that's available. That's not really a recipe for
being like, oh, yeah, we can get rid of this employee.
What if you get rid of this employee and then
you get rationed in terms of your compute capacity for
replacing them.
Speaker 5 (10:26):
I'm sure you know.
Speaker 3 (10:28):
There are absolutely going to be stories of silly tech
companies that go and lay off critical parts of their
workforce and then realize that AI cannot do what they
thought it could at the price that they thought they
would be able to do it, And those stories will
be funny, not funny.
Speaker 5 (10:40):
For the laid off.
Speaker 3 (10:41):
People, but funny for the idiot CEOs that go and
do that. But yeah, this is all part of why
it is not disrupting the labor market and the aggregate.
And by the way, we'll get a report on that
tomorrow morning at eight thirty and I expect it to
confirm our predictions.
Speaker 5 (10:57):
On all this.
Speaker 2 (10:58):
Let's take a quick break here and when we return,
do we want to stick with like the chat gptification
of American business. That's a good piece from the Wall
Street Journal. Let's talk about that and we've got trivia next.
Speaker 1 (11:14):
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(11:37):
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Speaker 6 (11:52):
Time now for Trivia on the Financial Exchange. Yesterday Ted
Turner passed away at the age of eighty seven. Turner
built a media empire by being an early adopter of
cable television. Turner launched multiple networks Turner Classic Movies, Cartoon Network, CNN, TBS, TNT.
(12:13):
Those were all Ted Turner's networks at one point. So
today's question is what was the first cable network Ted
Turner launched? Which was the first cable network Ted Turner launched?
Speaker 5 (12:26):
It was in the mid seventies.
Speaker 4 (12:27):
By the way, be the.
Speaker 6 (12:29):
Third person to text us along with along with the
keyword trivia to Texas at six one seven three six
two one three eight five with the correct answer, and
you'll win a Financial Exchange Show t shirt. The third
correct response will be our winner. See the complete contest
rules at Financial Exchange Show dot com.
Speaker 2 (12:47):
Mike, we got a piece in the Wall Street Journal.
It's titled the Chat gpt ification of American Business. What
exactly is it talking about here?
Speaker 3 (12:55):
So, what brands are realizing is that while businesses may
not be latching heavily onto Chat GPT, it remains the
most popular large language model AI platform for retail users.
And so what they are doing is creating new applications that,
rather than living on Android or iOS. They are living
(13:17):
in chat GPT itself. It's a way of effectively having
people within chat GPT ask questions about what was One
of the examples Starbucks, Little Caesar's, Wyndham Hotels, for example,
apparently allowing you to engage directly in there with you know,
(13:40):
an AI about the brand and have it make suggestions
to you based on you know, whatever they put into
these apps. But it does not look like many of
them are moving from there to okay, now place your
mobile order here. Instead it's saying, okay, great, now open
up the Starbucks app to go place your order. I
gotta say, I don't. I don't really comprehend why you
(14:04):
would want this.
Speaker 2 (14:06):
It's so here's here's my view, mic is it's nineteen
ninety six, and you need a website because everyone needs
a website.
Speaker 3 (14:16):
That's kind of where I'm landing, right, But that's fine, Like, yeah,
the first websites sucked. Yeah, they like you can do
like you would go to you know whatever, like let's
say like McDonald's dot com, you know, back in the day,
and I bet it was just a picture of like
a big mac. Yeah, and you know maybe the entas.
Speaker 2 (14:36):
Yeah, it was it was useless, but that doesn't mean
it can't be an important part.
Speaker 4 (14:41):
Of where you're going.
Speaker 2 (14:42):
Sure, and figuring out how to crawl before you walk
before you run is an important piece of this. So
I'm not gonna, you know, disparage a brand for being like, hey,
AI is getting used a lot more. There's gonna be
a lot more AI usage in the future. We need
to start figuring this out. Like I'm not gonna eat
them up for trying something new because quite honestly, I
(15:04):
like to beat companies up when they're lazy and they
don't try new things. So just like, oh, we can
you know, rest on our laurels or you know, hey, well,
you know, lobby a few politicians for legislation that benefits us.
Speaker 4 (15:15):
Like, no, that's the stuff that bothers me.
Speaker 2 (15:17):
If you want to hire some people to figure out,
you know, how you can generate more sales using AI. Sure,
like your your first few things, They're going to suck
like this is how it is with any new technology.
And I'm not gonna beat them up because they have
like a sucky product on chat GPT right now. I'm
at least happy that they're trying to figure out Hey,
(15:38):
there's new technology.
Speaker 4 (15:39):
Can we make it work for us?
Speaker 2 (15:41):
And if ultimately the answer is no, then they'll figure
that out and move on.
Speaker 5 (15:45):
And you do need to be aware of them.
Speaker 3 (15:47):
You need to be where your customer is, and the
customer right now is on chat GPT by and large.
Speaker 5 (15:52):
Yeah, right, Like that part is true.
Speaker 3 (15:54):
What I've just been struggling with is I don't fundamentally
understand what Starbucks app on chat GPT can tell me
about Starbucks that chatchipt can't already, because presumably it can
scrape the Internet and look for store locations and products
and everything else about it. So that piece I'm just
struggling to comprehend. But I'm with you insofar as, yeah,
(16:17):
right now everybody's on chat GPT, at least in terms
of the free unpaid users, and so yeah, retail brands
that appeal to that group should be there and doing
what they can to figure it out. Can I talk
to you about I was just talking to Ben the
line about this. So you know, I famously do not
have an iPhone, and I instead have a Google phone
(16:39):
that has Gemini built into it, and so I've been
engaging with that in different ways recently because you've named it, No,
I just call it Gemini. I don't want to get
that close to my AI. But a year ago, when driving,
it was basically the Google Assistant was built in there
to just exclusively answer driving related questions. So for example,
(17:02):
if I, you know, asked Google, I don't know what
year was Wendy's founded, it wouldn't tell me. It would
just navigate to the closest Wendy's, which is not terribly useful. Today,
I can have a full on conversation with Gemini while driving,
which might be distracting and maybe something that I shouldn't
be doing. But you know, if I want to have
(17:23):
a conversation about Jane Goodall and have it tell me,
you know, her experience and her education and how she
came to do what she did, it'll have a fifteen
minute conversation with me about that and prompt in a
whole bunch of different ways. If I want to learn
about the demographics of people that take the commuter rail
(17:44):
in Boston, it will pull up stats and tell me
about these different subjects and we can have a lengthy
conversation about it, which is I'm sure ultimately going to
lead to me being misinformed about something at some point
down the road, but very interesting and actually like pretty
useful compared to what I do currently, which is, you know,
(18:08):
listen to a few podcasts about subjects that I want
to learn about when driving during my once a week
hour and a half each way commute that I do.
Speaker 5 (18:17):
Mike, goohd.
Speaker 2 (18:19):
Sorry to digress back to a previous topic. Ben sent
me from the Web Design Museum McDonald's original website in
nineteen ninety six. Oh yes, there's not even a home
button on it. Yeah, it's all It looks like it's
just like drawn using Microsoft paint, basically. Sure, and like
(18:40):
the menu at the top is the eight items McDonald's
system now showing our food, fun stuff, community around the globe, careers,
and mixed sports, which I don't know what mixed sports is.
Speaker 4 (18:54):
I mean I I I.
Speaker 2 (18:57):
When I was an intern in New York, I participated
in a chicken nugget eating competition.
Speaker 5 (19:03):
That's what it is.
Speaker 4 (19:04):
Yeah, that's that's the mixed sportsport.
Speaker 5 (19:06):
Yeah.
Speaker 2 (19:07):
But uh yeah, it's again it's exactly like, there's nothing
useful that you could do here.
Speaker 3 (19:13):
Yeah, so presumably these apps are garbage today and we
will laugh at them ten years from now exactly.
Speaker 2 (19:18):
And that's that's totally fine because again I think, you know,
maybe we'll look back at them and say, oh, like
these are quaint just like nineteen ninety six. Well, we'll
just have to see kind of where things go. Let's
take a quick break here. Trivia Answers next.
Speaker 1 (19:40):
Bringing the latest financial news straight to your radio. Every day.
It's the Financial Exchange on the Financial Exchange Radio Network.
Till you out full Wall Street Watch tracking the stocks,
the dato and the headlines driving markets so far today
right here on the Financial Exchange Radio.
Speaker 6 (19:58):
Network eleven thirty four, and we have some mixed markets
out here to Dow Jones is off just over a
tenth a percent, or fifty eight points. The S and
P five hundred is up two tenths of a percent,
The Nasdaq is up a little over half percent. Meanwhile,
gold is up just under a percent and a half,
(20:19):
while silver is up just over six percent. Shake Shack
shares are off by thirty percent after the burger chain's
first quarter results fell short of expectations and reported an
operating loss of two point six million dollars. Shake Shack's
earnings per share broke even versus earnings of twelve cents
a share expected from analyst. Revenue came in at three
(20:41):
hundred and sixty six point seven million dollars versus the
three hundred and seventy two million dollar consensus estimate. McDonald's
posted a beat on both the top and bottom line.
Unfortunately for McDonald's, shares are down four tenths of a percent.
Adjusted earnings came in at two dollars and eighty three
cents per share versus the two dollars and seventy four
sense of share expected from analysts. Revenue was six point
(21:02):
five two billion dollars compared to the six point four
to seven billion consensus. Door Dash shares are off seven
seven tenths of a percent after the food delivery giant
issued a Rosie guidance for orders in the second quarter.
DoorDash sees marketplace gross order value ranging from thirty two
point four billion dollars to thirty three point four billion dollars.
(21:24):
I on Q shares are off sixtensive percent. The Quantum
Computing Company said that adjusted losses before interest, taxes, depreciate, depreciation,
and amortization, it came in at ninety six point eight
million dollars in the first quarter. That's wider than the
loss of eighty point four million dollars. Analyst Pold had
(21:45):
sought I am Ben Kitchen and that was Wall Street Watch.
Our trivia question today was which was the first cable
network Ted Turner launched. Your answer was w t BS.
Today's winner is Steve In with West Yarmouth. You will
be taking home a Financial Exchange Show t shirt. We
(22:07):
play trivia every day here on the Financial Exchange. See
complete contest rules at Financial Exchange Show dot com.
Speaker 5 (22:13):
Chuck and Ben before we move on.
Speaker 3 (22:15):
I know we pride ourselves on this program about being
in touch with the younger generation. And Boston Globes reporting
it today. I heard it over the weekend from a
high school teacher of mine.
Speaker 5 (22:28):
Do you know what sport is sweeping the nation in
high schools?
Speaker 4 (22:33):
Pick a ball?
Speaker 3 (22:36):
The sport that is sweeping the nation right now is
hacky sack. You cannot find a hacky sack in stores
anywhere in the state right now.
Speaker 6 (22:45):
It's nineteen ninety four.
Speaker 5 (22:46):
Yeah, they are taking out from gen xers.
Speaker 3 (22:49):
And well, you know what, there's an miaa Hockey Hackeysack
league where you can get ranked and I agree it's
not a sport. But nonetheless, Hackey sack, which I have
not seen since like ninety two, is apparently dominating schools
all across the country right now and actually leading to
difficulty and physically finding Hackey.
Speaker 6 (23:10):
Sa These kids all wearing Jenco jeans and airwalks.
Speaker 5 (23:13):
Sneakers and sideways hats.
Speaker 2 (23:14):
Yes, yeah, I'm sorry. Look, you can love Hackey sack,
there's nothing wrong with that. Calling it a sport's not okay,
it's it's not a sport. Doing that fundamentally devalues what
Hackey sack is supposed to be, which is the ability
to participate in something that's not connected to winning or losing.
Speaker 5 (23:32):
Yeah, that's fair.
Speaker 3 (23:33):
You know, it's the Boston Globe did not call it
a sport, so maybe I misspoke.
Speaker 5 (23:37):
They look at it a game.
Speaker 3 (23:38):
Yeah, but I think that's fair. I was shocked to
hear this. It came out of nowhere for me. And yeah,
I was at my former high school over the weekend
and my former high school math coach or math teacher
informed me that hacky sack is the new thing sweeping
the nation.
Speaker 6 (23:56):
Next it's going to be devil sticks.
Speaker 4 (23:57):
So that the joke that I made actually.
Speaker 2 (24:02):
Like, this is what you are seeing right now is
the same thing we saw in the nineteen nineties for
the baby boomers. The boomers in the nineties had everything
marketed to them because they were the biggest generation and
they were, you know, on the come up and had
you know, the buying power.
Speaker 4 (24:20):
It's the same thing. Now.
Speaker 2 (24:22):
Look at any commercial and how many songs are from
the late nineties and early two thousands. There's a reason
why this is happening, and it's not in accidents, because
the marketers want parents in their thirties and forties to
be like, oh, I want to buy the stuff from
my kid that I had when I was a kid.
(24:43):
Like it's it's not an accident. So yes, I do think, uh,
you know, Jinko jeans will be back soon, not even kidding.
Speaker 6 (24:53):
They already are actually are they? Yes, And unfortunately my
wife is into him.
Speaker 4 (24:59):
There you go.
Speaker 3 (25:00):
Just to be clear though, to reiterate here in the
Boston Globe article, there is a link to the twenty
twenty sixth Division one Boys Hacky Sack Power rankings that
ranks the top thirty two teams by town and East
Bridgewater's taking the number one seed right now.
Speaker 5 (25:14):
It's a team sport. Just reporting what I see here, Jock.
Speaker 3 (25:19):
I apparently is this like figure skating where you can
have like the individual competition and then the team. I'll
do some research and get back to you, because I'm
not honestly sure right now.
Speaker 5 (25:30):
But yeah, hacky Sack is back.
Speaker 4 (25:34):
What do you are You called a hacker?
Speaker 5 (25:36):
No, that's a different thing. They don't want to confuse
those two.
Speaker 4 (25:41):
A sacker.
Speaker 5 (25:43):
Yeah, that's better.
Speaker 3 (25:44):
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(26:06):
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(26:52):
multitude of different places. On the other hand, there can
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And so this guy that we have from Armstrong this
month is all about evaluating that spread, that.
Speaker 5 (27:11):
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Speaker 3 (27:12):
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Speaker 4 (27:58):
He's the Boston Globes.
Speaker 2 (28:00):
If the starter home, some buyers are going straight to
cape vacation houses. And basically what this is talking about
is that you've got people who are saying, Hey, I
see the rental market in vacation towns is so hot
right now that I'm gonna buy that place and rent
it out weekly on Airbnb or Verbo or something like that,
and then continue renting where I live. It's an interesting
(28:24):
strategy as long as the economy remains good. I know
a number of people that you know we're doing this
strategy in two thousand and five to two thousand and seven,
how they were aspiling aspiring real estate moguls. And I
got to tell you when the visitor numbers drop and
you can't rent your place out but still have the mortgage.
Speaker 4 (28:46):
You learn very quickly.
Speaker 2 (28:48):
That this becomes you know, pretty dangerous pretty fast.
Speaker 4 (28:54):
Yeah.
Speaker 3 (28:54):
Look, I think the number of people that can actually
pull this off is pretty limit blim. You know, they
interview a couple in New York who doesn't have any kids,
and yeah, buying a place in Brooklyn or Manhattan is
not quite feasible. But they could instead forward one on
the cape that needed some renovations, which is an interesting story.
It's yeah, pretty slim, pretty rare. Most people with young children,
(29:17):
for example, want the stability of owning their home and
being in the same school district while they raise them,
so that leads to some impracticalities. But I have always
found it a fascinating phenomenon of the idea of Hey,
you know, we all think about building wealth through home ownership,
and that is a way to do it. But there's
been plenty written on if people are disciplined enough to
rent and then reinvest what they would be putting into
(29:40):
home ownership into a different asset class, and in this
case it's a rental property. You can be as well
or better off by doing so. If you execute on
it properly. I think the problem is it takes a
lot of discipline.
Speaker 5 (29:52):
Right.
Speaker 3 (29:52):
The temptation when you're renting is, oh, look at this
extra money I have. I'm going to go spend that
on vacations and dining out and all the other things
that appeal to me.
Speaker 2 (30:01):
Yeah, it's like anything else, look at it. As you mentioned,
it all comes down to the execution.
Speaker 4 (30:07):
Uh.
Speaker 2 (30:07):
There are ways that you can you know, execute well
with leverage.
Speaker 4 (30:12):
When I start hearing about people.
Speaker 2 (30:14):
You know, who don't own a home that are trying
to buy a short term rental place in a vacation town,
it it makes me a little bit nervous to hear
that because those are very much boombustuh cycles that you
go through in terms of the type of rental. Like
it's again even just within residential real like rental real estate,
(30:38):
there's something entirely different from being like, Hey, I'm gonna
you know, buy a cheap long term rental in you
know city X that's you know, nearby to where people
need to commute, versus yeah, let's go, you know, buy
the place on the beach and then rent it out.
Those things can change, you know. One of these is
not like the other. Yeah, is basically where I'm going.
Speaker 3 (31:00):
I did learn recently about a fascinating though tax loophole
involved in owning and managing a short term rental that
is not really available to other types of rental property,
which is interesting to me. I'm no CP, I'm no
tax experts, so other people need to research it. But
it's specific to just being an active manager in a
(31:22):
short term rental compared to say leasing out to a
one year tenant.
Speaker 5 (31:26):
So interesting stuff that is actually available out there.
Speaker 2 (31:30):
Just take a quick break. When we come back, we'll
do a little bit of stack roulettes.
Speaker 1 (31:35):
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Speaker 4 (32:09):
All right, let's do a little bit of stack though
out here. Mike, what do you got for me?
Speaker 3 (32:13):
I've got the smugness of ev drivers out there, because
I genuinely don't believe that there is anyone who is
more smug than somebody who drives an electric vehicle when
gas prices are over four dollars per gallon. Market Watch
has a piece exploring just all the cost savings that
people are talking about. But when you combine the EV
(32:35):
license plates, you know, they insist on getting the license
plate that says EV right on there. So in case
you mistook that Tesla for an F one fifty, they.
Speaker 5 (32:45):
Would correct you on it.
Speaker 3 (32:47):
Plus the you know, there are genuine cost savings, especially
right now to plugging in at home and charging instead
of filling up the gas tank. There's just a lot
of EV drivers out there who are just an extreme
amount of smug. In twenty twenty six, one thing I
didn't know that this article pointed out there are several
states and utility companies that will actually provide additional incentives
(33:13):
for people who drive evs to charge at night during
specific hours. So Ever, Source locally has one of these
programs depending on your charger and your electric vehicle, where
they'll pay up to eighty bucks a year to have
a monitoring system in place to ensure that you are
charging between the hours of like nine pm and I
think five am for example, which you know is an
(33:36):
additional costings that's out there that I just you know,
wasn't previously aware of to you know, keep grid demand down.
So I don't have a perspective on any of this
other than just EV drivers are very smug when gas
prices are high, and it's kind of.
Speaker 5 (33:52):
Annoying, shouldn't they be? Yeah?
Speaker 3 (33:55):
I mean I now own an EV and it is
rather nice right now to be able to drive that
thing around instead of filling.
Speaker 4 (34:01):
Up my Are you smug right now?
Speaker 5 (34:05):
Yes?
Speaker 3 (34:06):
But I don't go around bragging about it other than
this segment right now.
Speaker 2 (34:13):
Mike, if it feels like you could use someone to
talk to about this, yeah, yeah.
Speaker 4 (34:19):
It seems like there's a lot going on. Let's see.
Speaker 2 (34:21):
I want to talk about this piece here that was
kind of interesting yesterday. Yesterday Anthropic announced in agreement to
use all of the compute capacity at SpaceX SpaceX's coloss
Is One Data center, Tennessee, to which you have to
ask a couple things here. If there's one thing that
(34:43):
Anthropic seems to be not great at, it's building compute capacity.
If there's one thing that they seem to be really
good at. It's building models.
Speaker 5 (34:53):
Yeah.
Speaker 2 (34:54):
If there's one thing that XAI now inside of SpaceX
seems to be good at, it's building compute capacity. If
there's one thing that they don't seem to be good at.
Speaker 4 (35:06):
It's building models.
Speaker 2 (35:08):
And so the interesting piece on this to me is
it's kind of it's two enemies getting together to try
to screw over Sam Altman. It does seem a bit
like that, you know, very recently Elon Musk cannot stand
Sam Altman, Like they got this trial going on right now.
Speaker 4 (35:28):
They do not like.
Speaker 2 (35:29):
Each other at all, and so I think part of
this is Elon just being like, screw Sam. I don't
want them to win. It's fine if someone else does.
Speaker 4 (35:38):
But whatever.
Speaker 2 (35:39):
The other piece is, Hey, it's pretty clear that Elon
spent a bunch of money building out this giant data
center with two hundred and twenty thousand GPUs, and they
don't have anyone who wants to use their product in
large enough numbers for it to be justified right now.
Speaker 3 (35:53):
Yeah, it does seem like a nail in the coffin
for Grock their AI tool. I also do kind of
just find it, you know, consistent with Elon's personality of
having called Anthropic quote from a post earlier this year,
misanthropic and evil, but has since changed his tune. And
my answer is, well, of course he changed his tune
(36:15):
once they started paying.
Speaker 2 (36:16):
Him, and once he realized that the data center that
they were building and have built didn't have any use
and was gonna lose a boatload of money.
Speaker 3 (36:25):
Right, Yeah, they were evil until they paid me. So
that's pretty consistent with Elon's view on the world.
Speaker 2 (36:32):
But yeah, this was kind of interesting to me, and
it potentially clears like the major bottleneck in the short term,
at least for Anthropic. Again, who knows how much you know,
additional compute capacity they need. But this is one where
like Anthropic couldn't do anything else. It's like having a kid.
If you want to have a kid today, well you
got to start nine months ago. It's the same thing
(36:52):
with a data center. You want to have a data
center today, you got to start a year ago, you know.
And so Anthropic clearly didn't understand how much demand was
going to be there for their product, and so this
is the only way that they could solve it. Unfortunately,
Xai had so little demand for their product that they
were able to basically say, yep, you can buy all
(37:14):
the compute capacity that you want at our Colossus data center.
Speaker 5 (37:18):
Yeah.
Speaker 4 (37:18):
So that's kind of just an interesting little marriage that
you have there. What else you got for me?
Speaker 3 (37:24):
The MarketWatch laid out a consumer choice award for car brands,
and Honda pretty much took them all, to which I say,
I don't care about a consumer choice award. The consumer
choice award is how many vehicles did you sell? And
once again, the Ford F series truck sold eight hundred
and twenty nine thousand units in twenty twenty five, which
(37:46):
beat out the next best selling vehicle, which was the Silverado,
by over two hundred and fifty thousand units. So you
can tell me that Honda's winning over and over again
in terms of loyalty, but they weren't on the list
until number four.
Speaker 5 (38:02):
In terms of units sold.
Speaker 3 (38:03):
Here in the US, pickup trucks dominate Ford F Series
in particular.
Speaker 4 (38:07):
We're done for the day. Back at it tomorrow.
Speaker 2 (38:09):
We got a big job support to talk about, and
we will see you then
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(01:05):
Chuck Zadith and Mike Armstrong.
Speaker 2 (01:11):
Chuck, Mike, and soccer with you, and as we kick
things off here, we've got stocks drifting modestly upward on
a couple of the major indices. But the Dow is
off twenty two points right now, while the S and
P's up twelve nas that can posite up one hundred
and thirty one. We've got the US ten year treasury
basically flat, down eight tenths of a basis point today
(01:32):
to four point three four six percent. Taking a look
at mortgage rates, they've come back in his rates have
come down in the last couple of days, back down
to six point four to four percent after being north
of six and a half for you know, the beginning
part of the week.
Speaker 3 (01:48):
Uh.
Speaker 2 (01:48):
Taking a look through other markets, Dollar Index down point
one seven percent to ninety seven to seven oh five,
and gold up another seventy six point thirty trying to
make a rally after just choppy trading the last couple months,
but back up to forty seven to seventy one right now.
Speaker 4 (02:04):
And crude oil.
Speaker 2 (02:05):
West Text Intermediate down another three ninety nine a barrel
to ninety one oh nine trip a national average for
gas prices is up another let's see we get up
another half, sorry, up another two point two cents to
four fifty five and eight tenths. If you're wondering on
the divergence, there a couple things. The first is there
(02:26):
is always a little.
Speaker 4 (02:27):
Bit of a delay.
Speaker 2 (02:27):
Remember those oil prices just started falling yesterday. But also
those oil prices are oil futures. For in the case
of West Text Intermediate, you are looking at the June contract.
Speaker 4 (02:41):
If someone is getting.
Speaker 2 (02:42):
A barrel delivered today, it is a different price for
either crude or finished product than what you were seeing.
And remember finished product also includes, you know, additional costs.
There is a spread that refiners make and what you
are seeing on those what they're called is cracks. Those
crack spreads are running, you know, two or three times
(03:03):
what they normally are because of demand for finished product
in the market. So it wouldn't be entirely unexpected here
if you saw a little bit of a divergence build
between crude futures pricing and gas pricing right now based
on combination that's spread and you know, other factors related
(03:24):
to gas futures also diverging a little bit from crude.
So You've got some different pieces that are moving here,
but ultimately we could see maybe a ten to fifteen
cent relief on prices at the pump if prices were
to hold here in the coming four to five days.
We'll see where we go.
Speaker 4 (03:45):
Anything else catching your eye, Mike.
Speaker 3 (03:47):
No, mortgage rates obviously remaining elevated in that six and
a half percent range, and we're seeing it reflected in
the housing market so far this year with just activity
being a little bit lackluster.
Speaker 2 (04:00):
Let's talk about this piece in the Wall Street Journal.
Corporate layoffs are down ten percent this year, but the
AI reckoning has come for tech, And I gotta be honest,
this is kind of a garbage piece.
Speaker 3 (04:12):
So my favorite part of it, though, Chuck, is when
they talk about these corporate layoffs being down ten percent,
but the AI reckoning has come for tech. They've got
this beautiful visual of a bunch of circles indicating how
big the layoffs have been, and two of them include
UPS and Heineken, Well and Dows.
Speaker 2 (04:33):
In here like Dow Chemicals in here, Morgan Stanley's another one.
Speaker 3 (04:37):
Yeah, they're all in the list, but even the graphical image,
they included UPS and heine when talking about the tech
are in the graphic too, they are okay, yeah, yeah.
Speaker 2 (04:46):
Like they're all in there, So these are not tech
layoffs that are in there. And I gotta be honest,
this doesn't Okay, here's the deal. If you actually take
a look at what we are seeing from and this
is from indeed, so it's again private data that we
are seeing here. Software development job postings are now up
(05:10):
fourteen percent year over year. Did you know that, Michael No?
Speaker 4 (05:15):
I did not.
Speaker 2 (05:16):
I didn't either until a good friend, well not really
a good friend, but I follow him on social media.
Gey Berger had he goes through all of the data
on a regular basis and he's like, yeah, software was
basically in the wilderness until a few months ago, and
now you've had a bunch of software positions that have
opened recently, and so year over year you've got you know,
(05:40):
software developer job opening growth. And remember openings typically lead hiring.
What's going on in big tech, Mike. The companies that
are laying off tons of people they over hired during
the pandemic and now they're trying to get back to
their you know, appropriate size headcount. In my opinion, Yeah,
by the way.
Speaker 3 (06:00):
If they can do it at the same time as
you know, AI washing it by saying that their employees
are far more efficient, then their stop price gets rewarded too,
So you've got this double incentive to do all of this.
Speaker 2 (06:15):
So I'll make the case right now from what we've
seen so far. Again, we got a jobs report tomorrow,
but based on the aggregate data that we've seen for
the first three and a quarter months of the year,
because again we just don't have a ton from April yet,
the job market has not worsened any further, and might,
(06:38):
actually I'll even go past might, there are parts of
the job market that are showing green shoots now for
renewed growth as we enter into the spring. I'll like,
I think that if you are looking at the job
market honestly, and I try to, because for the second
half of last year I said, guys, we've got a problem,
(06:58):
like something is really you know, trending in.
Speaker 4 (07:01):
The wrong direction in the job market.
Speaker 2 (07:04):
Got to be honest, the last three to four months
you have absolutely seen a turn that at the very
least indicate that that downward momentum is stopped, and in
a number of places are indicating that you've got some
positive momentum that's beginning.
Speaker 5 (07:19):
So what is this again?
Speaker 3 (07:22):
This piece, I think is just buying into the the
overdone fear that AI is coming for the labor market
in twenty twenty six. And it's not to say that
it won't ever. I think there is this risk it
won't in twenty six. Yeah, I think there is that far.
There's this risk out there in my view, where there's
(07:46):
kind of two extreme paths that I can look at
with AI. One would be where this technology continues to
develop at such a fast pace like it has over
the last couple of years that it does eventually disrupt
a whole bunch of jobs, and because it developed so fast,
there's not new jobs coming to replace that immediately. It
takes a few years for the labor market to kind
(08:07):
of recover itself.
Speaker 5 (08:08):
In that case.
Speaker 3 (08:10):
The other path, which is another extreme, is it kind
of follows the path of the Internet, where big gains
were made right up front, and then those gains slowed
down considerably and what you were left with was a
bunch of companies trying to figure out how to monetize
the new technology, a bunch of companies that had overspent
on developing the technology, and you ended up not with
(08:33):
a labor market problem due to the Internet, but rather
a stock market problem because everybody was betting that it
was going to be bigger than it wound up being.
So yeah, it's not to say that there can't be
problems from for the labor market from AI, and it's
not to say that specific jobs are already being disrupted
by AI, but the idea that it's leading to higher
(08:54):
unemployment and layoffs in twenty twenty six is there's just.
Speaker 2 (08:59):
No evidence beyond that. I'll put one other thing on
the table, is why you're not going to see it
become a meaningful problem in twenty twenty six. Mike, what's
the biggest problem with artificial intelligence as it relates to
its use in the workplace right now?
Speaker 5 (09:15):
Privacy and security? No, No, that.
Speaker 4 (09:19):
Might be in our industry, but in general, just live
it too much.
Speaker 5 (09:21):
I don't know.
Speaker 2 (09:23):
There's not enough capacity, Yeah, Mike, how are you going
to displace jobs if you are being rate limited in
terms of how much you can actually do with AI?
Speaker 4 (09:32):
Right now?
Speaker 5 (09:33):
Yeah, it's fair.
Speaker 3 (09:34):
You got to pay an immense amount of money if
you actually want the capacity to do something impressive with it.
Speaker 2 (09:39):
So I think that you absolutely don't have enough compute
capacity for it to displace any meaningful number of jobs
this year and change the trajectory of the labor force
as a result of it. It's not to say that
we won't get to a point in the future where
that becomes the case, but this year. Talk to anyone
who uses you know, COUD, which is now seen. I
think it's seen in I believe eightyfold increases what their
(10:02):
CEO said in activity over the last five months.
Speaker 4 (10:06):
They can't use enough.
Speaker 2 (10:08):
They keep getting like booted out of the system because
they've used too much of their compute capacity. They're rationing
the compute that's available. That's not really a recipe for
being like, oh, yeah, we can get rid of this employee.
What if you get rid of this employee and then
you get rationed in terms of your compute capacity for
replacing them.
Speaker 5 (10:26):
I'm sure you know.
Speaker 3 (10:28):
There are absolutely going to be stories of silly tech
companies that go and lay off critical parts of their
workforce and then realize that AI cannot do what they
thought it could at the price that they thought they
would be able to do it, And those stories will
be funny, not funny.
Speaker 5 (10:40):
For the laid off.
Speaker 3 (10:41):
People, but funny for the idiot CEOs that go and
do that. But yeah, this is all part of why
it is not disrupting the labor market and the aggregate.
And by the way, we'll get a report on that
tomorrow morning at eight thirty and I expect it to
confirm our predictions.
Speaker 5 (10:57):
On all this.
Speaker 2 (10:58):
Let's take a quick break here and when we return,
do we want to stick with like the chat gptification
of American business. That's a good piece from the Wall
Street Journal. Let's talk about that and we've got trivia next.
Speaker 1 (11:14):
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(11:37):
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Speaker 6 (11:52):
Time now for Trivia on the Financial Exchange. Yesterday Ted
Turner passed away at the age of eighty seven. Turner
built a media empire by being an early adopter of
cable television. Turner launched multiple networks Turner Classic Movies, Cartoon Network, CNN, TBS, TNT.
(12:13):
Those were all Ted Turner's networks at one point. So
today's question is what was the first cable network Ted
Turner launched? Which was the first cable network Ted Turner launched?
Speaker 5 (12:26):
It was in the mid seventies.
Speaker 4 (12:27):
By the way, be the.
Speaker 6 (12:29):
Third person to text us along with along with the
keyword trivia to Texas at six one seven three six
two one three eight five with the correct answer, and
you'll win a Financial Exchange Show t shirt. The third
correct response will be our winner. See the complete contest
rules at Financial Exchange Show dot com.
Speaker 2 (12:47):
Mike, we got a piece in the Wall Street Journal.
It's titled the Chat gpt ification of American Business. What
exactly is it talking about here?
Speaker 3 (12:55):
So, what brands are realizing is that while businesses may
not be latching heavily onto Chat GPT, it remains the
most popular large language model AI platform for retail users.
And so what they are doing is creating new applications that,
rather than living on Android or iOS. They are living
(13:17):
in chat GPT itself. It's a way of effectively having
people within chat GPT ask questions about what was One
of the examples Starbucks, Little Caesar's, Wyndham Hotels, for example,
apparently allowing you to engage directly in there with you know,
(13:40):
an AI about the brand and have it make suggestions
to you based on you know, whatever they put into
these apps. But it does not look like many of
them are moving from there to okay, now place your
mobile order here. Instead it's saying, okay, great, now open
up the Starbucks app to go place your order. I
gotta say, I don't. I don't really comprehend why you
(14:04):
would want this.
Speaker 2 (14:06):
It's so here's here's my view, mic is it's nineteen
ninety six, and you need a website because everyone needs
a website.
Speaker 3 (14:16):
That's kind of where I'm landing, right, But that's fine, Like, yeah,
the first websites sucked. Yeah, they like you can do
like you would go to you know whatever, like let's
say like McDonald's dot com, you know, back in the day,
and I bet it was just a picture of like
a big mac. Yeah, and you know maybe the entas.
Speaker 2 (14:36):
Yeah, it was it was useless, but that doesn't mean
it can't be an important part.
Speaker 4 (14:41):
Of where you're going.
Speaker 2 (14:42):
Sure, and figuring out how to crawl before you walk
before you run is an important piece of this. So
I'm not gonna, you know, disparage a brand for being like, hey,
AI is getting used a lot more. There's gonna be
a lot more AI usage in the future. We need
to start figuring this out. Like I'm not gonna eat
them up for trying something new because quite honestly, I
(15:04):
like to beat companies up when they're lazy and they
don't try new things. So just like, oh, we can
you know, rest on our laurels or you know, hey, well,
you know, lobby a few politicians for legislation that benefits us.
Speaker 4 (15:15):
Like, no, that's the stuff that bothers me.
Speaker 2 (15:17):
If you want to hire some people to figure out,
you know, how you can generate more sales using AI. Sure,
like your your first few things, They're going to suck
like this is how it is with any new technology.
And I'm not gonna beat them up because they have
like a sucky product on chat GPT right now. I'm
at least happy that they're trying to figure out Hey,
(15:38):
there's new technology.
Speaker 4 (15:39):
Can we make it work for us?
Speaker 2 (15:41):
And if ultimately the answer is no, then they'll figure
that out and move on.
Speaker 5 (15:45):
And you do need to be aware of them.
Speaker 3 (15:47):
You need to be where your customer is, and the
customer right now is on chat GPT by and large.
Speaker 5 (15:52):
Yeah, right, Like that part is true.
Speaker 3 (15:54):
What I've just been struggling with is I don't fundamentally
understand what Starbucks app on chat GPT can tell me
about Starbucks that chatchipt can't already, because presumably it can
scrape the Internet and look for store locations and products
and everything else about it. So that piece I'm just
struggling to comprehend. But I'm with you insofar as, yeah,
(16:17):
right now everybody's on chat GPT, at least in terms
of the free unpaid users, and so yeah, retail brands
that appeal to that group should be there and doing
what they can to figure it out. Can I talk
to you about I was just talking to Ben the
line about this. So you know, I famously do not
have an iPhone, and I instead have a Google phone
(16:39):
that has Gemini built into it, and so I've been
engaging with that in different ways recently because you've named it, No,
I just call it Gemini. I don't want to get
that close to my AI. But a year ago, when driving,
it was basically the Google Assistant was built in there
to just exclusively answer driving related questions. So for example,
(17:02):
if I, you know, asked Google, I don't know what
year was Wendy's founded, it wouldn't tell me. It would
just navigate to the closest Wendy's, which is not terribly useful. Today,
I can have a full on conversation with Gemini while driving,
which might be distracting and maybe something that I shouldn't
be doing. But you know, if I want to have
(17:23):
a conversation about Jane Goodall and have it tell me,
you know, her experience and her education and how she
came to do what she did, it'll have a fifteen
minute conversation with me about that and prompt in a
whole bunch of different ways. If I want to learn
about the demographics of people that take the commuter rail
(17:44):
in Boston, it will pull up stats and tell me
about these different subjects and we can have a lengthy
conversation about it, which is I'm sure ultimately going to
lead to me being misinformed about something at some point
down the road, but very interesting and actually like pretty
useful compared to what I do currently, which is, you know,
(18:08):
listen to a few podcasts about subjects that I want
to learn about when driving during my once a week
hour and a half each way commute that I do.
Speaker 5 (18:17):
Mike, goohd.
Speaker 2 (18:19):
Sorry to digress back to a previous topic. Ben sent
me from the Web Design Museum McDonald's original website in
nineteen ninety six. Oh yes, there's not even a home
button on it. Yeah, it's all It looks like it's
just like drawn using Microsoft paint, basically. Sure, and like
(18:40):
the menu at the top is the eight items McDonald's
system now showing our food, fun stuff, community around the globe, careers,
and mixed sports, which I don't know what mixed sports is.
Speaker 4 (18:54):
I mean I I I.
Speaker 2 (18:57):
When I was an intern in New York, I participated
in a chicken nugget eating competition.
Speaker 5 (19:03):
That's what it is.
Speaker 4 (19:04):
Yeah, that's that's the mixed sportsport.
Speaker 5 (19:06):
Yeah.
Speaker 2 (19:07):
But uh yeah, it's again it's exactly like, there's nothing
useful that you could do here.
Speaker 3 (19:13):
Yeah, so presumably these apps are garbage today and we
will laugh at them ten years from now exactly.
Speaker 2 (19:18):
And that's that's totally fine because again I think, you know,
maybe we'll look back at them and say, oh, like
these are quaint just like nineteen ninety six. Well, we'll
just have to see kind of where things go. Let's
take a quick break here. Trivia Answers next.
Speaker 1 (19:40):
Bringing the latest financial news straight to your radio. Every day.
It's the Financial Exchange on the Financial Exchange Radio Network.
Till you out full Wall Street Watch tracking the stocks,
the dato and the headlines driving markets so far today
right here on the Financial Exchange Radio.
Speaker 6 (19:58):
Network eleven thirty four, and we have some mixed markets
out here to Dow Jones is off just over a
tenth a percent, or fifty eight points. The S and
P five hundred is up two tenths of a percent,
The Nasdaq is up a little over half percent. Meanwhile,
gold is up just under a percent and a half,
(20:19):
while silver is up just over six percent. Shake Shack
shares are off by thirty percent after the burger chain's
first quarter results fell short of expectations and reported an
operating loss of two point six million dollars. Shake Shack's
earnings per share broke even versus earnings of twelve cents
a share expected from analyst. Revenue came in at three
(20:41):
hundred and sixty six point seven million dollars versus the
three hundred and seventy two million dollar consensus estimate. McDonald's
posted a beat on both the top and bottom line.
Unfortunately for McDonald's, shares are down four tenths of a percent.
Adjusted earnings came in at two dollars and eighty three
cents per share versus the two dollars and seventy four
sense of share expected from analysts. Revenue was six point
(21:02):
five two billion dollars compared to the six point four
to seven billion consensus. Door Dash shares are off seven
seven tenths of a percent after the food delivery giant
issued a Rosie guidance for orders in the second quarter.
DoorDash sees marketplace gross order value ranging from thirty two
point four billion dollars to thirty three point four billion dollars.
(21:24):
I on Q shares are off sixtensive percent. The Quantum
Computing Company said that adjusted losses before interest, taxes, depreciate, depreciation,
and amortization, it came in at ninety six point eight
million dollars in the first quarter. That's wider than the
loss of eighty point four million dollars. Analyst Pold had
(21:45):
sought I am Ben Kitchen and that was Wall Street Watch.
Our trivia question today was which was the first cable
network Ted Turner launched. Your answer was w t BS.
Today's winner is Steve In with West Yarmouth. You will
be taking home a Financial Exchange Show t shirt. We
(22:07):
play trivia every day here on the Financial Exchange. See
complete contest rules at Financial Exchange Show dot com.
Speaker 5 (22:13):
Chuck and Ben before we move on.
Speaker 3 (22:15):
I know we pride ourselves on this program about being
in touch with the younger generation. And Boston Globes reporting
it today. I heard it over the weekend from a
high school teacher of mine.
Speaker 5 (22:28):
Do you know what sport is sweeping the nation in
high schools?
Speaker 4 (22:33):
Pick a ball?
Speaker 3 (22:36):
The sport that is sweeping the nation right now is
hacky sack. You cannot find a hacky sack in stores
anywhere in the state right now.
Speaker 6 (22:45):
It's nineteen ninety four.
Speaker 5 (22:46):
Yeah, they are taking out from gen xers.
Speaker 3 (22:49):
And well, you know what, there's an miaa Hockey Hackeysack
league where you can get ranked and I agree it's
not a sport. But nonetheless, Hackey sack, which I have
not seen since like ninety two, is apparently dominating schools
all across the country right now and actually leading to
difficulty and physically finding Hackey.
Speaker 6 (23:10):
Sa These kids all wearing Jenco jeans and airwalks.
Speaker 5 (23:13):
Sneakers and sideways hats.
Speaker 2 (23:14):
Yes, yeah, I'm sorry. Look, you can love Hackey sack,
there's nothing wrong with that. Calling it a sport's not okay,
it's it's not a sport. Doing that fundamentally devalues what
Hackey sack is supposed to be, which is the ability
to participate in something that's not connected to winning or losing.
Speaker 5 (23:32):
Yeah, that's fair.
Speaker 3 (23:33):
You know, it's the Boston Globe did not call it
a sport, so maybe I misspoke.
Speaker 5 (23:37):
They look at it a game.
Speaker 3 (23:38):
Yeah, but I think that's fair. I was shocked to
hear this. It came out of nowhere for me. And yeah,
I was at my former high school over the weekend
and my former high school math coach or math teacher
informed me that hacky sack is the new thing sweeping
the nation.
Speaker 6 (23:56):
Next it's going to be devil sticks.
Speaker 4 (23:57):
So that the joke that I made actually.
Speaker 2 (24:02):
Like, this is what you are seeing right now is
the same thing we saw in the nineteen nineties for
the baby boomers. The boomers in the nineties had everything
marketed to them because they were the biggest generation and
they were, you know, on the come up and had
you know, the buying power.
Speaker 4 (24:20):
It's the same thing. Now.
Speaker 2 (24:22):
Look at any commercial and how many songs are from
the late nineties and early two thousands. There's a reason
why this is happening, and it's not in accidents, because
the marketers want parents in their thirties and forties to
be like, oh, I want to buy the stuff from
my kid that I had when I was a kid.
(24:43):
Like it's it's not an accident. So yes, I do think, uh,
you know, Jinko jeans will be back soon, not even kidding.
Speaker 6 (24:53):
They already are actually are they? Yes, And unfortunately my
wife is into him.
Speaker 4 (24:59):
There you go.
Speaker 3 (25:00):
Just to be clear though, to reiterate here in the
Boston Globe article, there is a link to the twenty
twenty sixth Division one Boys Hacky Sack Power rankings that
ranks the top thirty two teams by town and East
Bridgewater's taking the number one seed right now.
Speaker 5 (25:14):
It's a team sport. Just reporting what I see here, Jock.
Speaker 3 (25:19):
I apparently is this like figure skating where you can
have like the individual competition and then the team. I'll
do some research and get back to you, because I'm
not honestly sure right now.
Speaker 5 (25:30):
But yeah, hacky Sack is back.
Speaker 4 (25:34):
What do you are You called a hacker?
Speaker 5 (25:36):
No, that's a different thing. They don't want to confuse
those two.
Speaker 4 (25:41):
A sacker.
Speaker 5 (25:43):
Yeah, that's better.
Speaker 3 (25:44):
Folks want to talk to you about the brand new
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there's plenty of good reason to have accounts all over
the place.
Speaker 5 (26:09):
I've experienced this, especially.
Speaker 3 (26:11):
With members of the Great you know, the Great Generation,
the Silent Generation, who either live through or had parents
that lived through the Great Depression and saw banks just
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Speaker 5 (26:28):
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Speaker 3 (26:30):
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(26:52):
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And so this guy that we have from Armstrong this
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(27:33):
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Speaker 1 (27:42):
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Speaker 4 (27:58):
He's the Boston Globes.
Speaker 2 (28:00):
If the starter home, some buyers are going straight to
cape vacation houses. And basically what this is talking about
is that you've got people who are saying, Hey, I
see the rental market in vacation towns is so hot
right now that I'm gonna buy that place and rent
it out weekly on Airbnb or Verbo or something like that,
and then continue renting where I live. It's an interesting
(28:24):
strategy as long as the economy remains good. I know
a number of people that you know we're doing this
strategy in two thousand and five to two thousand and seven,
how they were aspiling aspiring real estate moguls. And I
got to tell you when the visitor numbers drop and
you can't rent your place out but still have the mortgage.
Speaker 4 (28:46):
You learn very quickly.
Speaker 2 (28:48):
That this becomes you know, pretty dangerous pretty fast.
Speaker 4 (28:54):
Yeah.
Speaker 3 (28:54):
Look, I think the number of people that can actually
pull this off is pretty limit blim. You know, they
interview a couple in New York who doesn't have any kids,
and yeah, buying a place in Brooklyn or Manhattan is
not quite feasible. But they could instead forward one on
the cape that needed some renovations, which is an interesting story.
It's yeah, pretty slim, pretty rare. Most people with young children,
(29:17):
for example, want the stability of owning their home and
being in the same school district while they raise them,
so that leads to some impracticalities. But I have always
found it a fascinating phenomenon of the idea of Hey,
you know, we all think about building wealth through home ownership,
and that is a way to do it. But there's
been plenty written on if people are disciplined enough to
rent and then reinvest what they would be putting into
(29:40):
home ownership into a different asset class, and in this
case it's a rental property. You can be as well
or better off by doing so. If you execute on
it properly. I think the problem is it takes a
lot of discipline.
Speaker 5 (29:52):
Right.
Speaker 3 (29:52):
The temptation when you're renting is, oh, look at this
extra money I have. I'm going to go spend that
on vacations and dining out and all the other things
that appeal to me.
Speaker 2 (30:01):
Yeah, it's like anything else, look at it. As you mentioned,
it all comes down to the execution.
Speaker 4 (30:07):
Uh.
Speaker 2 (30:07):
There are ways that you can you know, execute well
with leverage.
Speaker 4 (30:12):
When I start hearing about people.
Speaker 2 (30:14):
You know, who don't own a home that are trying
to buy a short term rental place in a vacation town,
it it makes me a little bit nervous to hear
that because those are very much boombustuh cycles that you
go through in terms of the type of rental. Like
it's again even just within residential real like rental real estate,
(30:38):
there's something entirely different from being like, Hey, I'm gonna
you know, buy a cheap long term rental in you
know city X that's you know, nearby to where people
need to commute, versus yeah, let's go, you know, buy
the place on the beach and then rent it out.
Those things can change, you know. One of these is
not like the other. Yeah, is basically where I'm going.
Speaker 3 (31:00):
I did learn recently about a fascinating though tax loophole
involved in owning and managing a short term rental that
is not really available to other types of rental property,
which is interesting to me. I'm no CP, I'm no
tax experts, so other people need to research it. But
it's specific to just being an active manager in a
(31:22):
short term rental compared to say leasing out to a
one year tenant.
Speaker 5 (31:26):
So interesting stuff that is actually available out there.
Speaker 2 (31:30):
Just take a quick break. When we come back, we'll
do a little bit of stack roulettes.
Speaker 1 (31:35):
Okay, Real time financial insight as news breaks. The Financial
Exchange is live on x Watch the show and follow
us for the most up to date business news you
need to know. FACE is the Financial Exchange, market insight,
retirement strategies, real talk about Wall Street and economic trends,
all live every day on our YouTube channel. Go to
(31:56):
YouTube dot com Slash the Financial Exchange Show, Faces the
Ninchel Exchange.
Speaker 4 (32:09):
All right, let's do a little bit of stack though
out here. Mike, what do you got for me?
Speaker 3 (32:13):
I've got the smugness of ev drivers out there, because
I genuinely don't believe that there is anyone who is
more smug than somebody who drives an electric vehicle when
gas prices are over four dollars per gallon. Market Watch
has a piece exploring just all the cost savings that
people are talking about. But when you combine the EV
(32:35):
license plates, you know, they insist on getting the license
plate that says EV right on there. So in case
you mistook that Tesla for an F one fifty, they.
Speaker 5 (32:45):
Would correct you on it.
Speaker 3 (32:47):
Plus the you know, there are genuine cost savings, especially
right now to plugging in at home and charging instead
of filling up the gas tank. There's just a lot
of EV drivers out there who are just an extreme
amount of smug. In twenty twenty six, one thing I
didn't know that this article pointed out there are several
states and utility companies that will actually provide additional incentives
(33:13):
for people who drive evs to charge at night during
specific hours. So Ever, Source locally has one of these
programs depending on your charger and your electric vehicle, where
they'll pay up to eighty bucks a year to have
a monitoring system in place to ensure that you are
charging between the hours of like nine pm and I
think five am for example, which you know is an
(33:36):
additional costings that's out there that I just you know,
wasn't previously aware of to you know, keep grid demand down.
So I don't have a perspective on any of this
other than just EV drivers are very smug when gas
prices are high, and it's kind of.
Speaker 5 (33:52):
Annoying, shouldn't they be? Yeah?
Speaker 3 (33:55):
I mean I now own an EV and it is
rather nice right now to be able to drive that
thing around instead of filling.
Speaker 4 (34:01):
Up my Are you smug right now?
Speaker 5 (34:05):
Yes?
Speaker 3 (34:06):
But I don't go around bragging about it other than
this segment right now.
Speaker 2 (34:13):
Mike, if it feels like you could use someone to
talk to about this, yeah, yeah.
Speaker 4 (34:19):
It seems like there's a lot going on. Let's see.
Speaker 2 (34:21):
I want to talk about this piece here that was
kind of interesting yesterday. Yesterday Anthropic announced in agreement to
use all of the compute capacity at SpaceX SpaceX's coloss
Is One Data center, Tennessee, to which you have to
ask a couple things here. If there's one thing that
(34:43):
Anthropic seems to be not great at, it's building compute capacity.
If there's one thing that they seem to be really
good at. It's building models.
Speaker 5 (34:53):
Yeah.
Speaker 2 (34:54):
If there's one thing that XAI now inside of SpaceX
seems to be good at, it's building compute capacity. If
there's one thing that they don't seem to be good at.
Speaker 4 (35:06):
It's building models.
Speaker 2 (35:08):
And so the interesting piece on this to me is
it's kind of it's two enemies getting together to try
to screw over Sam Altman. It does seem a bit
like that, you know, very recently Elon Musk cannot stand
Sam Altman, Like they got this trial going on right now.
Speaker 4 (35:28):
They do not like.
Speaker 2 (35:29):
Each other at all, and so I think part of
this is Elon just being like, screw Sam. I don't
want them to win. It's fine if someone else does.
Speaker 4 (35:38):
But whatever.
Speaker 2 (35:39):
The other piece is, Hey, it's pretty clear that Elon
spent a bunch of money building out this giant data
center with two hundred and twenty thousand GPUs, and they
don't have anyone who wants to use their product in
large enough numbers for it to be justified right now.
Speaker 3 (35:53):
Yeah, it does seem like a nail in the coffin
for Grock their AI tool. I also do kind of
just find it, you know, consistent with Elon's personality of
having called Anthropic quote from a post earlier this year,
misanthropic and evil, but has since changed his tune. And
my answer is, well, of course he changed his tune
(36:15):
once they started paying.
Speaker 2 (36:16):
Him, and once he realized that the data center that
they were building and have built didn't have any use
and was gonna lose a boatload of money.
Speaker 3 (36:25):
Right, Yeah, they were evil until they paid me. So
that's pretty consistent with Elon's view on the world.
Speaker 2 (36:32):
But yeah, this was kind of interesting to me, and
it potentially clears like the major bottleneck in the short term,
at least for Anthropic. Again, who knows how much you know,
additional compute capacity they need. But this is one where
like Anthropic couldn't do anything else. It's like having a kid.
If you want to have a kid today, well you
got to start nine months ago. It's the same thing
(36:52):
with a data center. You want to have a data
center today, you got to start a year ago, you know.
And so Anthropic clearly didn't understand how much demand was
going to be there for their product, and so this
is the only way that they could solve it. Unfortunately,
Xai had so little demand for their product that they
were able to basically say, yep, you can buy all
(37:14):
the compute capacity that you want at our Colossus data center.
Speaker 5 (37:18):
Yeah.
Speaker 4 (37:18):
So that's kind of just an interesting little marriage that
you have there. What else you got for me?
Speaker 3 (37:24):
The MarketWatch laid out a consumer choice award for car brands,
and Honda pretty much took them all, to which I say,
I don't care about a consumer choice award. The consumer
choice award is how many vehicles did you sell? And
once again, the Ford F series truck sold eight hundred
and twenty nine thousand units in twenty twenty five, which
(37:46):
beat out the next best selling vehicle, which was the Silverado,
by over two hundred and fifty thousand units. So you
can tell me that Honda's winning over and over again
in terms of loyalty, but they weren't on the list
until number four.
Speaker 5 (38:02):
In terms of units sold.
Speaker 3 (38:03):
Here in the US, pickup trucks dominate Ford F Series
in particular.
Speaker 4 (38:07):
We're done for the day. Back at it tomorrow.
Speaker 2 (38:09):
We got a big job support to talk about, and
we will see you then
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