Motley Fool Money - Motley Fool Money: 03.28.2014

Episode Date: March 28, 2014

Facebook makes a big buy.  Microsoft introduces Office for the iPad.  And Candy Crush gets crushed.  Our analysts discuss those stories and share three stocks on their radar.   Plus, Motley Fool retirement expert Robert Brokamp talks portfolio rebalancing, hidden fees, and financial planning. Learn more about your ad choices. Visit megaphone.fm/adchoices

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I'm Chris Hill. And in studio, we've got from Motley Fool 1, Jason Moser, from Motley Fool, Supernova, Matt Argusinger, and for a million-dollar portfolio, Ron Gross. Good to see you, Jens. Hey, hey, Chris. We have got the latest on the TV industry, the food industry, and the sexy world of cloud computing. Our guest this week will help you rule your retirement, and as always, we've got a few stocks you can put on your radar. But this week, we're going to start off with the social network.

Facebook announced it is buying Oculus VR, a company that makes virtual reality goggles and a deal worth $2 billion. Ron, right now they're just used for playing video games, but here's a quote from... Not actually yet. Not yet, but here's a quote from Facebook CEO Mark Zuckerberg, who clearly has big plans for this. set of goggles. He said, imagine enjoying a court-side seat at a game, studying in a classroom of students and teachers all over the world, or consulting with a doctor face-to-face, just by putting on goggles in your home. That seems way far off in the future, but maybe not. I mean, this is a company you watch, $2 billion. What do you think of the acquisition?

Mixed emotions, but not a big fan overall. I would say I'm concerned that Zuckerberg, who has a big pocketbook, a big wallet here right now, is spending money. he's certainly a visionary and I respect that. I would certainly have never been able to build the kind of company he has built. But I think he's throwing money at things now and he's going to see what sticks down the road. Is virtual reality coming? Sure, 10, 20 years from now, I think it'll be a huge thing. Will it be big for Facebook?

I'm not sure. I don't know why he couldn't have partnered here with this company rather than spend $2 billion. I don't know necessarily if their technology is unique. There's other folks like Sony who have virtual reality. technology. I respect the vision. I'm just a little bit concerned about the price tag. Speaking of the price tag, most of it was stock, though, Jason. Yeah, I mean, you've got to give him a pat on the back for that one. I mean, that's using Facebook shares when they're at all-time highs. I mean, that's a very cheap currency for

him, and it's going to keep the power of the company firmly in his hand. So that's good. The deal's getting cheaper by the day, man. I mean, you know, this thing was pegged at about a $70 dollar share price and Facebook now at about 60? Well, it's no longer a $2 billion acquisition now, is it, Chris? Well, and this is the thing with Facebook that Jason's mentioned. I mean, it's just, you know, no matter what happens to the core business of Facebook, and it still could be strong in five years, but Facebook's equity base and capital base allows them to make these acquisitions, and they can see, as Ron says, they can see what sticks. And granted, if they threw enough billions around, something's got to be sticking. So, you know, in five years, they might

actually look good with this. Now, the CFO of Facebook said, we think just the gaming, alone will be multiples of what we've paid. Interestingly enough, the gaming industry, the gamers of the world are revolting here. They really don't want to be in bed with Facebook for various reasons. They liked kind of the independence of Oculus. Facebook says, okay, they're going to operate autonomously. But a lot of people are saying, whoa, whoa, whoa, this is not what we signed up for. So we'll see if the backlash continues.

Yeah, Jason, speaking of backlash, there was also backlash from another community, and that is Oculus, this is a company that had about $90 million in venture capital money behind it. But before that, it raised about $2.5 million through Kickstarter. For those who don't know, Kickstarter is a platform that enables people to raise money for anything from a business to an individual project. The recent Veronica Mars movie started off with $2 million from Kickstarter. And there are people saying, wait a minute, I helped raise money to get this off the ground. A, I don't like that you're now with Facebook. And some people are saying, hey, wait a minute.

Where's my cut of this $2 billion? Well, I think it's certainly going to make, it's going to beg the question going forward exactly how, how well Kickstarter is going to be able to be used for something like this. I mean, we were talking about this earlier on the week. It's one thing if you're chipping in a little money maybe for a movie or a project to be made, because you can sort of value the enjoyment that you personally might get from that. But there are about 9,500 people that chipped in to raise. is $2.5 million, about $250 a person. And that's an average. So there are a lot of people that chipped in a lot more than $250. And at the end of the day, I remember, you know, not like the Charlie Brown, it's a great pumpkin where they all go trick-or-treating and they all

get their canyon and Charlie Brown, he ends up getting a rock. Yeah. And I mean, these people got Charlie Brown. I mean, they end up getting a rock out of this whole deal because they walk away like a t-shirt and a paperweight. And I mean, to Ron's point, I don't think a lot of people necessarily want to be in bed with Facebook, because even when they say, you know, they'll, because continue to operate autonomously. I don't know that people actually trust that. I don't think I even trust that to at least a degree. I think for a while, but I mean, then I've seen rumors that they're going to rebrand the headset with the Facebook logo. I mean, boy, you'll see a revolt then if that actually happens. Well, let me just say I'm also a little bit disgruntled, too, from an

investor point of view. I mean, as a rule breaker investor, I mean, I want to see companies like Oculus eventually come public at smaller capitalizations so that we can buy them and, you know, have a great potential recommendations as public companies. But if Facebook's of the world and Google's of the world are buying up all these small companies, we never really get a chance to as a small investor. Ron, just to wrap up on Facebook, the stock, it seems at least on the surface, like when you look at this acquisition, $2 billion versus the WhatsApp acquisition at $19,000, both for the price tag and for the fact that WhatsApp is closer to the basic business of Facebook,

it would seem like analysts would be pushing Facebook to make the WhatsApp acquisition work a lot sooner than this one. Well, definitely, and just because of the size of the money we're talking about, with Facebook at a market cap of $155 billion, they have $11 billion in cash, the $2 billion, even if you light it on fire, probably won't make that big a difference. My concern is this a trend of spending lots of money on things to see what sticks. Facebook is the largest position in the million dollar portfolio. We're big fans. Doesn't mean we have to like everything we see.

The IPO of the week was King Digital Entertainment, the company behind the hit video game Candy Crush. It went public at $22.50 a share. And, Maddie, I'll be honest, I was expecting yet another IPO where the stock pops for no particularly good reason. That's right. The stock fell 16% on the opening day. Is sanity returning to the market? I think there's a small dose of saying that's coming back to the market. You see this.

You see King Digital come down. You also see Castlight Health, which came two weeks ago public, and it's down about 30% from its IPO high. So yes. The thing with King Digital, which is interesting, is actually this is a pretty profitable company. They did over a billion in revenue last year. Their profit margins is in this 40% range. So this is an extremely profitable company. The problem is they get three quarters of their revenue from a single game, the Candy Crush saga.

Look, I see people all over the place playing this game. I've never played the game. Has anyone here played Candy Crush? No, but I do have a couple of friends who are hardcore. A fool of our sand. Cicatelo's raising a hand in the studio. But every other person on the Metro, you know, on their phone or on their iPad, is playing this game.

Well, that's really encouraging. It is. A lot of smart people out there, I guess. But, yeah, I think investors and the markets are being smart with this. They're saying, look, you know, this is an interesting company, very profitable. They might come out with better games, but guess what? Right now, this is a huge risk. If people stop playing Candy Crush and they can't.

There you go. One word. Farmville. Farmville. Back to a company, I think that maybe, more listeners could identify with, and that's Walgreens. Second quarter profits were hit by weaker margins. America's largest drugstore chain. Going to get a little bit smaller, Jason. They announced they're going to close 76 stores. That's not even 1% of their overall base.

But what did you make of the quarter? Well, weaker margins and I guess we weren't quite getting sick enough, Chris. They said it was a lighter than expected cold and flu season. So, damn, I guess hats off to everyone out there for eating better and taking care of yourselves. The creepy thing is I follow a casket manufacturer that blamed the same thing. No kidding around. It's pretty creepy. People just aren't dying like they used to. Life expectancy are higher.

They're healthier people. But yeah, I mean, to that point, Walgreens is the biggest player in this space, a little bit bigger than CVS, but these companies make a lot of their money from prescription drugs. About 65% of their sales are tied to prescription drugs. And when they see the generics kind of going out of cycle and they have to, the generic drugs are a better, they're more profitable. They have, they have higher margins for these companies. And so they saw a little bit of headwind there. You know, overall, closing a few of those

stores is no real big deal because at the end of the day, they're still net going to grow the overall footprint. You know, the thing I don't really like about Walgreens and CBS and Rite Aid is they're all basically sort of commoditized to this point where the only real competitive advantage is location. If I know that you're going to take my insurance and chances are probably they all three do. I don't care where I get my prescription filled. I just want to go to the closest place and get it done. And so that's why you see these companies trying to become more things to more people.

And we talked before about the Walgreens sushi experiment. I mean, I don't know that I'm ever buying sushi from Walgreens, but they thought maybe it was worth a shot. So you're going to see them doing that and they're going to be acquiring businesses like they bought Duane Reed up in New York. But, you know, I mean, the more they try to become more things to more people, the more difficult that becomes to manage. And when you start acquiring more companies, that's not always a given either. And so when I look at this market in general, it's interesting to observe. But I just don't really see much to invest in in that regard. So just to be clear, if you're a shareholder of Walgreens, CVS, you're clearly rooting for people to get sick.

And if you're Ron with his casket maker, you go one step down. It is a little creepy. Wow. Coming up, TV gets more complicated and breakfast gets more awesome. Stay right here. This is Motley Full Money. Welcome back to Motley Full Money. Chris Hale here in studio with Jason Moser, Matt Argusinger, and Ron Gross. On Thursday, Microsoft CEO, Satya Nadella, unveiled what many were expecting, and some investors were definitely hoping for, and that is that Microsoft office is now available on the iPad.

Ron, shares a Microsoft up on Friday in the wake of the event. Wall Street likes to move, do you? Say hello to Sacha Nadella. That's the big deal here. break from the Windows tradition. People have been waiting for it for a long time. I think this is the first shot that you see in that regard. I like this move a lot. Microsoft was really giving away probably a billion plus a year

by not having this app. And now that they have it, I think it makes perfect sense. And as I said, it's the first time we see the break with Windows and it's going to be good for Microsoft going forward. Not bad for Apple either. They're getting their standard 30% cut. Yes. And since we own both,

Microsoft and Apple. We're playing both sides of this trade here, but the 30% cut will be nice as well. Well played. It was a good week for anyone looking for traditional television to be disrupted. First, we had reports that Apple is in talks with Comcast about a streaming TV service that would use an Apple set-top box. And second, Amazon is holding a media event on Wednesday, April 2nd to provide an update on Amazon's video business. And the reports are that Amazon will be launching a free ad-supported TV service separate from Amazon Prime. Jason, first, when it comes to Apple and Comcast, I think we talked about this a little bit earlier in the week. We were just around the water cooler. It's hard to see how that works out well for Comcast.

Yeah, I mean, I'm not sure maybe from the perspective that you actually get a brand that people like and respect involved with them, because I think otherwise most people hate Comcast. I mean, even though they provide you with your Internet and cable, I mean, they just don't seem to really have it going. on the service side of things. But, I mean, you see a lot of this talk going on. It seems like all the time. So I'm not exactly sure how that really would play out. But, you know, we are in the middle of just this major disruption in linear television and really how we consume our content.

And really the definition of a TV has changed here to where, you know, your phone and your tablet, you know, those are TVs. And I think the Amazon news is a bit more interesting just because it seems like they're trying to sort of disrupt that whole sort of network TV. model that we're used to. I mean, they last summer, they cooperated with CBS to get under the dome out, and that was very successful, so they're going to continue that. They're adding more shows to that arsenal there.

But yeah, when you have companies like Apple, Google, Amazon, Comcast, they're obviously, they have the financial wherewithal to do these kinds of things. And so like it or not, they're going to be ones who are changing the landscape for us. I think this is all good for us TV watchers out there. We'll be

wherever it comes from. I just got a Roku box yesterday and was excited to hook it up. Obviously, in Amazon, something similar would be exciting as well. Apple's been trying to tackle this for quite some time, and it's interesting that they think the best way is to get to get in bed with someone like Comcast because they need what's called that last mile, which is the actual pipes that go into your house and direct traffic, and they don't want to be on the regular internet traffic. They want to kind of be segmented, so the experience is faster and stronger for people watching their content. So it's interesting. that the cable company is the way they may decide to go. This is way too early to say. There

has to be a lot of infrastructure bought here. Apple doesn't have much meteorites even. They need to develop content. So we're really in the early stages here, but it could be exciting in general for us TV watchers. I would be remiss if I didn't mention that on the Roku, the Motley Fool does have its own video channel. So I certainly hope you'll be subscribing to that. Maddie, another winner in all this, advertisers, if all of a sudden you've got additional options, particularly when it comes to streaming TV, that helps with the ad budget. No doubt about it. And I do like what Jason said about, you know, Apple's sort of brand and, you know,

customer-friendly, intuitive software overlaid on what Comcast has is going to be a much, you know, it's much better. Bad week for Rackspace hosting on Tuesday, Google announced it is cutting prices for its cloud computing services. And on Wednesday, Amazon responded with a price cut for its Amazon Web Services and shares of Rackspace, Maddie. They're taking a hit. Yeah, and down big over, you know, if you look back,

a couple of years now. And like I said before the show, Rackspace is kind of like that mom-and-pop general store in the small town and Amazon's, I'm sorry, Walmart's, you know, building their store about a mile away. That is the problem right now because Amazon, Google, Microsoft eventually as well, they've just been slashing prices for their cloud computing infrastructure. And that's because those big tech guys can do that. In fact, Amazon's cut its web services prices 42 times over the last six years. It's remarkable. But that's because they know, in my view, that infrastructure for cloud computing is a commodity business now.

And so they're interested in not really making that a big business, but essentially providing services for those users. Rackspace is a pure play, though, on cloud infrastructure. And if their prices are getting slashed that way, it's bad for them. And I just think Rackspace is in a really tough spot right now. Just over a year ago, Rackspace shares were trading in the high 70s. Now it's in the low 30s. Is this a value play or a value trap?

I would lean towards a value trap, especially, you know, you had the founder and CEO just recently left or resigned from the company. So a lot of bad news for Rackspace. Taco Bell is now offering breakfast. Most of the attention is focused on one menu item in particular, and that is the Waffle Taco, which is Taco Bell's answer to the Egg McMuffin. It is a waffle sandwich with sausage and egg. The company rolled... And syrup. And syrup.

How could we forget the syrup? Taco Bell rolled this out with TV ads featuring men across. America who just happened to be named Ronald McDonald. It was a cheeky ad, Ron. It was good, but it was well played. And you look at how big the breakfast industry is somewhere in the neighborhood of $40, $50 billion. This seems like a pretty smart move. It's big business. I like the irreverence of the marketing campaign. It's fun. And they're really going head-to-head with a lot of the folks, McDonald's especially. We'll see if it works. But I think the early indications are that it's going to be very successful for them.

And Jason, we talk all the time about how you look at the restaurant business. Alcohol is a high margin item. Guess what? Coffee, oatmeal? They're also high profit margin, too. Yeah, absolutely. I mean, this is a very smart move for young brands or for Taco Bell. I mean, while I'll never go eat it, I mean, I'm sure there are plenty of people out there that will. But, you know, you see the same thing with Starbucks, for example, is really they're investing more into their food offering, number one, but really even taking the Seattle's best brand and building those little standalone breakfast shops where you can drive through and get a coffee in a breakfast sandwich that way too. So I think a lot of these restaurant concepts are seeing that breakfast

is a tremendous incremental opportunity to add to the operations that they have already going. And so I expect to see this continue. Plus the CEO has asked when this will be rolling out to Canada. And he said as soon as they take Justin Bieber back. That's the correct answer. Let's bring in our man from the other side of the glass. Steve brought us. Steve Taco Bell, breakfast.

Are you excited? You have my attention, and I'm quite interested. I'm quite interested. I think it sounds like a terrific move. Do you have a Taco Bell on your way? When you drive to the office here, is there one on the way? And where I'm going is I'm thinking it would be great if in the next week or so you could do a little test. Perhaps I can.

There is one near. I will do it. All right, Ryan Gross, Matt Argusinger, Jason Moser. Guys, we will see you later in the show. Went to a night spot where the lights were low. Dine and dance. I was ready to go. I got out of my seat and when floor arose.

She said, hold it, Daddy, while a powder my nose. I sat back down with a smiling face while she went down to the powder place. With my green back, green back dollar bill, just a little piece of paper coated with Florafil. The music stopped and the lights came on. Coming up next, Robert Brokamp is going to help you rule your retirement. You're listening to Motley Fool Money. Welcome back to Motley Fool Money.

I'm Chris Hill. We're wrapping up March and heading into April, which is National Poetry Month, national welding months, and also National Financial Literacy Month. Joining me in studio now is the most financially literate person I know. Robert Brokamp is a certified financial planner and the Motley Fool's resident retirement expert.

Thanks for being here. Sure. I actually also minored in poetry in college. I should say that, although I don't have a poem prepared now, but maybe later. That's okay. My first six questions are about welding. The last time you were in here, and we were talking on the show, it was late 2013,

which turned out to be just a fantastic year in the stock market, just about 30%. 2014-so-4, not as hot, but still up slightly. But now we're starting to see some investing thought leader, Seth Klarman, leaps to mind, coming out and saying, you know what, I'm going to wave the warning flag on this one. I think we might be in bubble territory, that sort of thing. You went through the last bubble, just like I did. When you look at the market right now, what goes through your head? So I always look at it from the perspective of a financial planner. And when a financial planner thinks about investments and returns, thinks about what's going

to happen in the future so that I know I have enough to retire, so that I have enough to pay for college, so I have enough to know that when I do retire my money, it will last as long as I do. So valuations are important because study after study has shown that a highly valued market means that future returns, not in the next year two or three, but over the next seven or ten, will be low. Right now, if you look at something like the Schiller PE or the P.E.10 is what is also called sometimes. The market is high. It's not bubble territory. It's not 2000 territory, but it's high, and that it means future returns over the next seven or ten years will probably be below average, certainly below that 10 percent that we always hear about maybe seven, five, something like that.

Certainly 2013 was a great year, but if you widen the lens and you go back to 2007, then you're factoring in the Great Recession. The overall return over that time period is, you know, it's fine, but it's certainly not, you know, blazing red hot. Right. Right. So for me, I think the important thing to think about is how much risk you should be taking if you decided, for example, a few years ago that, you know what, I only want 70% in the stock market. Right now, that probably means you're 90% or 95% in the stock market. And they're like, okay, is that where I want to be right now? And the interesting about that, of course, for most people, that also means they're either two years closer to retirement or two years

deeper in retirement, which probably means you should be taking a little less risk over these couple of years. So maybe it's time to rebalance it a little bit. I was just going to say, is that the best move for people to, when they look at their portfolio, to think less? Because I think there are certainly investors out there who tend to think in absolute terms. And let's face it, there's some people on Wall Street who want you to think that way because it's like, oh, you got to get out of the market. You got to be all in cash now or you need to be all in, that sort of thing. But it sounds like rebalancing is a much more nuanced and in the long run a much smarter approach for people. What is the best way to

go about that, though? The best way to do rebalancing is to start with the allocation that you think is appropriate for you. So let's say it's 70 percent stocks. It's tricky these days because where does that other 30 percent go, cash or bonds, which are just going to be horrible, horrible investments in terms of future returns. We know that. However, they will likely hold up better the next time the stock market really goes down,

and it will at some point. So you have to look at it in terms of, all right, having some money for protection more than great returns. So let's say you're getting close to retirement, and you want to protect some of your money, 70% stocks, 30% out of the market. You build sort of a buffer around that

and say, like, okay, once I reach 80, 85% stocks, then it's time to pull it back. And then the other way, it works the other way, too. If the stock market goes down and then you're reaching 60% stocks or something like that, then it's a good time to rebalance by selling some of those bonds, using that cash to buy stocks. It is a little bit of a way of buying low and selling high without, as you said, going all in, selling everything. And you can do it gradually too. So if you're still working and you're contributing to your retirement accounts, you're buying up some of the assets that have been down or something that you're lighted. Another example, by the way, is international stocks. International

stocks have not done as well as U.S. stocks. So chances are you're probably light on those these days. U.S. stock market has done much better. History has shown that there's a sort of hokey-pokey between U.S. stocks and international stocks. One will be in, the other one will be out. So at some point, international stocks will do better. So now might be a good time to buy some of those. And on the other end, when you're retired, you rebalance by selling the things that have done particularly well. You're listening to Motley Fool Money talking with Robert ProCamp, certified financial planner and retirement expert here at the Motley Fool. We talk about stocks and bonds all the time, you and I. But two things that get a lot of headlines in the financial

media that I never hear you talking about are gold and alternative currency. And yes, I'm referring to Bitcoin. What do you say to someone? And maybe you've already. gotten these questions. But what do you say to someone who says, hey, I'm looking at gold? Hey, I'm thinking about Bitcoin. All right. So gold, I'll just give the classic line that anyone from the Motley Fool or even Warren Buffett or a lot of people will say about gold and that I invest in businesses. Gold is not a business. It doesn't have revenue. It doesn't have leadership. It doesn't have innovation. It's just a betel. And the price of it is determined somewhat by supply and demand. It has some industrial uses, but it's mostly a psychological issue.

People want to hoard it or they want to get rid of it. People say it's a good inflation hedge, but it peaked at some point in 1980, and it didn't reach that peak again until like 2003 or something like that. So that was not great inflation protection. So that's my take on gold for the most part. Bitcoin is a whole other creature. I mean, it's just it's something that I don't even. That's the other thing.

I invest in something I understand. That is something. I just don't understand. currencies in general, that is actually a reason why you would invest internationally because it is a hedge against a falling dollar. International stocks significantly outperformed U.S. stocks in the first decade of 2000s, and about a third of that outperformance was just due to strengthening currencies in the falling dollar. And it's a hedge against the U.S. dollar just going kaput. Now, for years you have run the Rule Your Retirement Service here at the Motley Fool, But recently you've taken on a new role, and that's your part of the Motley Fool One team now, which is our all-access service.

I should mention anyone interested in more information, it's actually open to new members just for a short amount of time. You can go to Fool1.com. That's the letter spelling of one, fool-O-N-E.com. I'm curious, though, in your role there, as a certified financial planner, what are some of the more common questions you're getting? from members. I'm assuming it's not about Bitcoin and gold. It is not about Bitcoin. Well, I'll see a lot of people actually do have gold because a gold is a fear investment. A lot of people are afraid of a lot of things. What's going to happen to the deficit is what's going to happen to America and stuff like that. So actually a lot of

questions about gold. Also, a lot of questions related to what I mentioned earlier and that people say, like, I know I shouldn't be 100% in the stock market, but what else should I do? I don't want to buy cash. And my answer to that is you should still play it safe. But what's probably the thing I talk about the boast with one members is whether or not they should have a financial advisor. Because a lot of people come to the Molly Fool, have financial advisors. And when you add up the costs of paying 1% a year to the financial advisor, the financial advisor puts you in mutual funds that charge another 1%. You're looking at paying 2% a year for asset management, you know, $2,000 for every $100,000 that you have that is not going to grow for you.

And most studies have shown that these folks are actually not outperforming the market, partially because of those costs. And then the third part is, are you getting any sort of financial planning advice along with that, retirement calculations, insurance analysis? And the truth is, the average stockbroker, someone who calls themselves a financial advisor, but they're more of a salesman, they really don't know that much about financial planning. So you're getting high fees, mediocre performance, and opinions about financial planning that are probably not very good. You add all that up and people are sort of waking up to, you know what, maybe there's a way to do this that is not so expensive.

I have a little bit more control and I have access to all kinds of experts from all over the country, do little research, those types of things. I think people are realizing they don't have to give everything over to one financial advisor. One thing that I think works against people in your position is something that I remember Jack Bogle talking about the guy who founded Vanguard and just one of the true great investors of the last hundred years. But Bogle talked about the lure of hidden fees and that, and I may get the exact numbers wrong, but I think he said something along the lines of people would rather pay $1,000 in fees that they never see as opposed to $50 out of pocket. Right. And I think that's part of, maybe that's part of human nature, but that does seem to work against you in your position saying, well, wait a minute, look at all the numbers here. You have to really draw them out. Right. You don't write a check to your mutual fund company or your financial advisor, generally speaking. They just take it out of your account, take it out of your IRA. You know, everyone thinks I can't take money out of my IRA until I'm 59.5. Well, your financial advisor can. Your mutual fund company can. They take it out. you compound a 1% fee over something like 30, 40 years.

You've cut your nest egg almost in half just because you have given up that money each year, but then you've lost out on the future growth of what you could have had if you instead had that money rather than paying it to somebody. I mentioned you and I are old enough. We vividly remember the last time the market had a serious correction, not the Great Recession, but back in 2000, 2001. How has your approach to retirement planning? How is your focus as someone around investing?

How has that changed over the last 15 years? One thing I don't think people appreciate enough of is thinking of their entire financial picture as one big business. So you do have your portfolio, and that's important. You have all your possessions, your home equity. all the things that you have in your house. You also have your human capital, which is your ability to earn an income, your ability to get another job

if something happens to your current job. Frankly, your ability to do things on your own so you don't have to pay someone, like financial management or even fixing something in your house. You sort of have to put all that together to think about how you are going to grow your wealth and protect your wealth. Health, I think, is a big part of that too.

One about a quarter of the people who retire actually do it earlier than they want, wanted to, but it was due to health reasons. So you can be, you can have a good job, you can be saving up money, but then something happens to your health. You didn't take care of yourself. You have to retire sooner than you had planned. You're kind of in a tough spot because you're no lot of are physically able to work. So you kind of have to make do on what you have. Before I let you go, I mentioned full one and sort of the questions you get from members. Are you hearing anything on the flip side in terms of benefits from the service that they're

particularly enjoying. Part of it is costs, and part of it, too, is people are waking up to the benefits of paying a flat fee. So for Motley Fool One, you pay a flat fee, and then you get all these services that will help you manage your portfolio as well as you can get some of your financial planning questions answered. If you're paying 1% a year, you're paying more and more as your account grows, even though the advisor isn't doing anything more for you. I was going to say, it's always nice to see your account grow, but what you're probably not thinking is, oh, my costs are growing as well. Right, exactly. So they're not doing any more than they were doing for you. So playing a flat fee is a huge benefit to that. And to the degree that you are willing to do some things on your own. The one thing I think is good about Motleyful One is sort of it can be a mixture between someone who wants to be a totally do-it-yourself person or, you know, just give me a little bit of guidance.

and I can do some of it, but I need someone to work with. I think that's helpful, too, because it's that middle ground as opposed to do it all by myself or hand everything over to a financial advisor. You can learn more by going to fool1.com. That's fool, O'N-E, fool-one.com. Robert Brokamp, thanks for being here, my friend. Chair. He tried to look like he had a little bit of money.

A grifter with a southern draw. Well, I could. Tell out of way by the way he was running that. Coming up next, we'll give you an inside look at the stocks on our radar. You're listening to Motley Fool Money. As always, people on the program have interest in the stocks they talk about, and the Motley Fool may have formal recommendations for or against. So don't buy ourselves stocks based solely on what you hear.

Welcome back to Motley Full Money, Chris Hill, here in studio with Jason Moser, Matt Argusinger, and Ron Gross. Guys, before we get to the stocks on our radar, some great news this week for fans of both beer and Star Trek. A Canada-based group called the Federation of Beer is launching a Klingon beer called Warnag. It is the first Star Trek-themed beer to come to the United States. This same group is already selling something called Vulcan ale in Canada. Ron, Warnog's going to be brewed in Evansville, Indiana, 5.5% alcohol.

What about blood wine? Isn't that what Klingon's drink? No, that was the Romulins. Oh, no, you're right. I think it was Klingon. Romulan ale is what I'm thinking of. Wow. I didn't know we had a couple of Star Trek.

I just want to know, is Commander Wharf going to be the brewmaster? I'm going to guess no, but I don't really know completely what you're talking about. Bloodbine is twice the alcohol content of scotch for those taking notes. Wow. Steve Broido, what do you think? We should talk, Ron. A little cling on beer to wash down dinner? Yeah, I don't know what any of you are talking about.

So let's a great segue into the stocks on our radar this week. Ron Gross, you're up first. Steve, will hit you with a question. Steve, a company near and dear to your heart, going back to Perry Ellis, P.E. are why this is the only company in the history of our deep value service that is currently in the red. They reported preliminary results a couple weeks ago that were not great. Stock sold off sharply. They report next week. I need more information. I want to hear where we're going with this company because on the face of it, it looks real cheap, but the business is kind of shaky.

Steve, question about Perry Ellis? Full disclosure, I have a family member who works there, but I don't understand Perry Ellis at all. I don't see that brand as being one that I would run to, say, wow, I really need to get a Peri Ellis shirt. It seems like sort of you're shopping at T.J. Max, and there's one there, and you're like, I guess this will work. Well, they're big in golf. The Peri Ellis brand does have its place. The Raphaelah women's brand is making a decent headway.

As with many retailers, they recently blame the weather and the poor retail environment, but we'll see where that goes. But I was wondering, how much importance do you place in your own wardrobe? Is that an important thing to you? As I get older, no. Not important. Matt Argusinger, what's on your radar this week? If you want a roller coaster company, Bank of Internet, B-O-F-I is the ticker.

Two weeks ago, the stock was hitting an all-time high of $106, dropped all the way down, I believe, the low 70s, and then on Friday is up over $10. This is just a company that it just had a meteorotic rise, growing really fast. It's a virtual bank, so no branches. It's just online. A lot of people are fans of the company. It just had such a tremendous run.

A short article came out, obviously, in the stock. is pretty expensive, so it's sold off a little bit with the market over the last few days, but I'm getting more intrigued by the day. It's one we own in Supernova. Steve, question about Bank of Internet? Didn't I&G try to do this and fail at it? Yes.

Well, no, they haven't failed at it. I mean, they still have... Aren't they gone? They've been rebranded. Let's put that. That sounds like a fail. Okay. Maddie, do you have a question you want to throw?

Sure. So, Steve, when is the last time you stepped in in the branch of your bank? Oh, it's been quite a while, I would say, well over a year. Very infrequent, yeah. Sounds like a potential candidate for the bank of Internet. Jason Moser, what's on your name right? Yeah, looking at Lulu Lemon, L-U-L-U. The two things that had me really hung up on this stock were leadership and the fact that it was an expensive stock.

And the prices has certainly come back to reality with the tough retail season. And leadership is, the shuffle is kind of over. Christine Day is left. Thankfully, founder Chip Wilson is no longer an issue. as you step down for the board. And I'm optimistic about what Laurent Pottenham will be able to do with the company. It's a very powerful brand. And they are growing their direct-to-consumer sales very rapidly, which is resulting in better margin picture for the company. So I think it's an attractive price today for a very powerful brand. And the ticker symbol?

LULU. Steve, question about Lillow Lemon? What do you think of yoga pants for men? Is there a market there? They look very comfortable. You're asking for a friend, right? Yes. Not for me. No. I'm just going to say sell, Steve. I'm selling yoga pants for men.

Not even a hole. I don't want to go there. Do you have a question for Steve? Yeah, Steve, am I the only one that when you say Perry Ellis, the first picture that comes in your mind is Perry the Platypus? Yes, I was thinking of Perry King from Riptide. Do you guys remember that show on TV? I do.

That's a bit of a poll. That's what I think of is Perry King from Riptide. That's a bit of a poll for you there. Who's the Perry that Leaps to your mind? Because I'm with Jason, as someone who has kids, the Disney Channel, Perry the Platypillar. Post, one of the great underrated. I'm a fan, but I'm Perry Ellis all the way.

Iconic brand, Steve, iconic. Maddie? Perry Cuomo? Perry Cuomo. I mean, really, only at Christmas times when you're rolling out the albums there. All right, Ron Gross, Matt Argusinger, Jason Moser, guys, thanks for being here. Thanks for you. Thank you.

As I mentioned in the last segment for just a little more time, you can check out Fool1.com. We're reopening the Motley Fool One service, so check it out at Fool1.com. That's O-N-E. Not the number one, Ron. No. It's fool-O-N-E. Dot com.

That's going to do it for this week's show. The show is mixed by Rick Engdahl. Our engineer is Steve Broido. Our producer is Matt Greer. I'm Chris Hill. Thanks for listening. We'll see you next week.