The I Love CVille Show With Jerry Miller! - Adrienne Stronge Of The Gaines Group Architects Joined Alex & Nickolas Urpí On “Today y Mañana!"

Episode Date: March 7, 2024

Adrienne Stronge, Project Manager at The Gaines Group Architects, joined Alex Urpí & Nickolas Urpí On “Today y Mañana!” “Today y Mañana” airs every Thursday at 10:15 am on The I Love CVille Network! “Today y Mañana” is presented by Emergent Financial Services, LLC, Craddock Insurance Services Inc, Castle Hill Cider, and Matthias John Realty, with Forward Adelante.

Good morning everyone and welcome to Today y Mañana. I'm Alex. This is Nick. We're very excited to have you joining us this morning on a very beautiful morning. It's gorgeous. It's going to be a nice spring day, I think, here in Charlottesville, Virginia. But it's still a great day to grab your café con leche, settle into a nice, comfortable place, and watch some Today y Mañana. Because we have a great show lined up for you. We're going to be joined shortly in the show by Adrienne Strawn.

She is a principal at the Danes Group Architects. Later we'll have some finance topics. We'll talk some crypto. We'll talk some good news, some bad news. So odd to be saying we're going to be talking crypto after you're like, well, we don't talk crypto. Well, we don't invest clients by default in crypto. Okay. We don't recommend crypto by default in crypto. Okay. We don't recommend crypto.

How's that? But we can talk about it because I think there are interesting things that you can follow with where cryptocurrencies go and why people may or may not put their money into cryptocurrencies, even if we wouldn't recommend cryptocurrencies to be a significant part of your retirement savings. Yeah. Should I put 80% in Bitcoin? No, probably not. Someone had asked me last night at a board meeting, hey, are you back to invest, putting

your clients in crypto? And I always say it's always amazing the number of conversations that we have with crypto, the extent to which we get asked about crypto correlates basically with the price of conversations that we have with crypto, the extent to which we get asked about crypto correlates basically with the price of crypto. As cryptocurrency prices skyrocket, all these people come ask, hey, should I buy some Bitcoin?

And then when cryptocurrency prices collapse, no one asks us anything. No one ever asks, this is a good time. Yeah, which is the opposite of kind of how it might work. A couple of shout-outs. Ricardo Cruz Duran, Amigo del Podrama,

thanks for watching the show this morning. Dr. Elizabeth Erpey watching the show this morning. And congrats to Ricardo. Yes, a good position. Johnny Ornelas, thank you for watching this morning. Another great entrepreneur here in Charlottesville. Always appreciate that. A couple of top tours. Thank yous. Love being here on the Isesville. Always appreciate that. A couple of, of course, thank yous.

Love being here on the Isle of Siebel Network set. A couple of thank yous. Thank you to Emergent Financial Services for being our presenter. Thanks to our great partners, Matthias Yohn Realty, Credit Series Insurance for Adelante. I think Matthias is coming on next week, I believe, unless I'm mistaken. I think he's going to be joining us next week. But looking forward to that. And, of course, looking forward to today.

And I don't know about you, but I'm ready to jump in. I'm ready to go. Let's do it. So we're excited to welcome to the show this morning Adrienne Strong. She is a principal at the Dean's Group Architects. Adrienne, thanks so much for coming on this morning. Yeah, thanks for having me on. No, I appreciate it.

So maybe for those who haven't met you yet, maybe tell us a little bit about yourself and how you first became interested in architecture in the field that you're in. Sure. So I grew up in West Point, Virginia, just a small town between Williamsburg and Richmond. I don't remember when it clicked for me that I wanted to be an architect. I always wanted to be an author. I love books. But at some point in high school, it sort of crept

into, hey, I think you'd be good at this. And then somebody told me that women don't become architects. And I like a good challenge. So that sort of rocketed that career choice to number one. And I applied to UVA School of Architecture and was a little nervous still going in about whether this career was it for me. But once I was there, it really felt natural. It felt like where I was supposed to be. And I love what I do. So to explain a little bit about this, I think it's great for people who I think we always I think the average person kind of knows a little bit of what an architect is. I think the

average person probably knows you need an architect or thinks you need an architect to build a house. Because they draw it and then it gets built. But what kind of does that entail? What does it mean for people who are new to it to be an architect that you actually do on a day-to-day basis? So what we are primarily is we're listeners. We listen to our clients. We listen to needs they have. We listen to problems they have with their

current space, whether that's their home, their work, or any place that they occupy, and we try and figure out what the best way is to solve that problem for them. So we do pretty much everything from office outfits to, you know, additions or renovations for single family, all the way up to custom residential homes. We've done a 10,000 square foot house, And then we do multifamily projects, warehouse projects, school additions, churches, really a little bit of everything. That involves making a space, I guess, for... Really listening to our clients, figuring out what they need and making spaces that work for their needs. That's fantastic. So how did you come to be part of the Gaines Group? So I was part of a studio at UVA called EcoMod,

where I was part of the second year of that project, and we did some relief work down for Hurricane Katrina. After Hurricane Katrina, we did a Habitat for Humanity house that we designed and built down there. And so I was busy. We were traveling back and forth a lot. I didn't have a chance to really apply many places. But the GAINS group received my resume and called me in for an interview.

And I happened to stop by on my way to construction, like in my dirty jeans and T-shirt. And we just really clicked. So they were all about sustainable construction and green design. And that really spoke my language. So I've been there ever since. So 2006. Wow. Wonderful. Congratulations. Thanks. Absolutely. So what are, what are, so I mean, you, you mentioned different types of projects you would age in. What are some like recent projects or things that people might say, oh yeah, okay. I kind of know something of that nature? Yeah.

So my specialty is multifamily. So the stuff I've been involved in locally are big apartment communities. So the Knoll up in Rutgersville and the Summit Apartments at Old Trail. And then we just wrapped up five-row apartments, which are currently leasing down in Albemarle County across from the county office buildings. Oh, yeah, not too far from here. Yeah, yeah. They're beautiful apartments. The interior is worth stopping by to look at.

But, yeah, they're leasing up now. I think they're fiverowapartments.com, number five. But, yeah, I love the modern design of that project and the interior of the clubhouse. We did some really cool wood details that my team worked on. It's just beautiful. So do you do both as an architect? Is it both? Because obviously it's the design of the space.

In other words, the floor plan, how it looks and so forth. Do you also go in? How deep do you go in terms of how the interior will look from a, will it be wood, will there be crown molding here, will there be that, how detailed does it actually get from an architectural perspective? So it really depends on the client and the project, but we do have an interiors team on our staff, so with that project in particular, we did the building design, the space layout. We helped with the community design, worked with the civil engineer there,

shimp engineering. But then went into the minuscule details, really designed the wood details inside, all the way down to furniture selections. So we really did the full package there. That's pretty neat that you can see. It must be exciting to see it from initial stage and know what it's going to look like all the way down to the final picture. That's why I love being a part of a small team, a small business,

because I really can follow the project from the very first meeting all the way through to that final design. And a lot of the larger firms, there are different teams that get to work on that. I love following from beginning to end. Now, what are the challenges for building something like a multifamily structure? Because I would assume that for a residential, you talk to the family, they have what they want. It's still probably complicated, but now you have to appease a tremendous amount of people rather than just one person that has a vision and that's part of what I love so um I I love going in from the very beginning laying out the project on the site

because what we're doing is trying to build a community really um and we're trying to build a community for everybody so um one of the things um again that I take a special interest in is accessibility from the site point of view to the apartment layouts to even the pool designs. So one of our projects over in Augusta County, the first apartment leased was to someone with a mobility issue because our pool had a ramp into it. And it had been one of those designs that had just, it was a really difficult design. I had spent a lot a ramp into it. And it had been one of those designs that had just, it was a really difficult design.

I had spent a lot of time on it. And so just knowing that bit of data made all of that time I spent on solving that problem worth it. Absolutely, yeah. Someone that was able to say, you know, this actually fits what I need. Yeah, yeah, exactly. So designing for all people, designing for all abilities, it really takes, it's a hard problem to solve.

Right. But designing a place that will accommodate a huge variety of people, I really love. That's fantastic. And I'm guessing it's also different even from a structural perspective because you're looking at totally different things or something of that size as opposed to a single family yeah so luckily we do have a structural design team and staff that can handle those small residential projects um which is really great

because from the beginning we can consider what the project's going to need structurally but when we get to something that's that large like like a multifamily project, we do work with different structural engineers on those. On those, yeah, to make sure it holds up. Yeah, exactly. And that's very important. Absolutely. Absolutely. So I guess on that vein, when you go into like a multifamily project, what are kind of the the things that people are thinking about

now architecturally speed obviously accessibility is one of them is it now more so more maybe more green space or more things that what are things that people are thinking about now from an architectural perspective of multi-family that maybe in the past they wouldn't have thought about yeah absolutely there's um So lately with the work remotely trend, we're seeing a lot of spaces both inside the clubhouse and outside on grounds that people can take their laptop and work because you don't always want to work in the same room every day. You want to work somewhere that makes you comfortable, work somewhere that makes you happy. So trying to create other places that people can go.

Having things like a conference room, we put one of those in the five-row clubhouse so that if somebody is working remotely, they have a place that they can go and meet clients. Interesting. You don't even need to- Now, was that accelerated by the pandemic or was that already a trend that we started seeing a while ago? It's sort of both. I think we started thinking about things like that before, but it really didn't take off until after the pandemic when everybody went remote and a lot of people just didn't go back to the office. So it's always been something we've thought about, but not to the extent over the last few years. Also pet ownership, dogs particularly.

We've been doing a lot of dog related amenity spaces. So we just finished one in Winchester where we did a canine activity park. So it's an indoor dog room for dogs to be able to play. So when it's raining outside and they can't go to the outdoor dog park they can take their dogs there and it also had as part of that a pet spa where you can take to to give your dog a bath or a grooming save you have to do it like in your rat tub exactly because I assume a lot of you have larger dogs that makes it more difficult than right right so we did a

space that would accommodate larger dogs and a space that would accommodate smaller dogs because really it's best for the owner of the project too because when you give a dog a bath, they're going to get water everywhere. Oh, right. Yeah. So it's best to design a space that specializes in that and also saves your client's back or your resident's backs because we were able to raise those up a little bit to make it easier to bathe.

Imagine trying to get your Siberian mastiff in the bathtub i always use that one just like the biggest dog or something you ever see they're like monsters i'm just like can you yeah you just imagine just own it like and because that affects a lot i would assume that especially with something like that it would affect a lot of people's decisions about where they can go. Oh, absolutely. Yeah. And pet-friendly communities are really something that a lot of our developers we work with are pushing. So spaces to walk the dogs and spaces to let them run.

I mean, it's in high demand. You know, it's a lot of people you see so many people. With dogs. Well, there was a dog when Elizabeth and I rented an apartment. My wife and I rented an apartment. we were the apartment like across from the dog park i mean that place was full from morning until 10 o'clock at night yep there were people with dogs in the dog park and the funny thing is i would say especially midday hours between maybe like on weekends between 10 and 3 it was as much a people park as a dog park.

They would all be sitting down and just chatting with each other. And you realize that they went there, yeah, the dogs are off running around. But they were all sitting down, just chatting, having a good time, enjoying the outdoors. It makes socializing so much easier. It's like having kids where you sort of, you have something in common with somebody, so you're automatically connecting with them on some level. Yeah. And you can let them bite each

other, which you can't do with kids. Right. Right. Just let them run. Exactly. On the trend topic, have you seen, what trends maybe have you seen on the residential side? Residential side, it's so different because every client is so different. Yeah, so it's really unique. There's a lot of really great kitchen innovations lately, you know, smart appliances and all that. So it really depends on how much somebody likes to cook and how much they like smart technology.

But there's been a huge push for us with aging in place considerations. So making sure that the houses we design can accommodate everyone, whether that's something they're immediately concerned about or something. They just plan on being in this house forever. And so they want to be able to stay in this house forever so oh that's that's interesting so you're trying to design it such that it's it works for them now but it'll also work because i know that it used to people always say that you know in real estate that you know you hit a certain age you have to then go look for like the ranch yeah style homes you don't want stairs anymore and so forth. But is it sort of, can we incorporate elements of that into the home we're building now? Yeah. So a lot of people just, they'll still do their upstairs spaces, but they want a first floor master.

They want a zero entry shower. They want enough room around the commode to be able to transfer over if that becomes something in their future. Kitchen. It's important to make sure everything's within reach. Microwaves under the counter is something we've seen a lot lately. And then just making sure the front entry of the house, if there's no ramp there now, that it's designed in such a way that one could be added easily. Ah, interesting.

But we've seen people who have needs up to, they project that in the future they might need an elevator. They don't want to lose access to their basement or their upstairs space. So designing a well placed closet and making sure the electrical equipment is sized correctly can make that an addition

in the future. Are we talking about an elevator like in a building where you press the button and it goes up? Are you talking about like the stair thing where you sit on the chair? No, no, a full-on elevator. So they do make residential size elevators. I don't, I can't remember whether we've put one in a house yet, but we have designed spaces

where one can go in in the future if needed. Wow, interesting. Which is clever, you don't have to take on the upfront cost of the elevator now because you don't need it, but you have a spot for it. Right. You know that when you go to put it in at a later date, you're not trying to figure out, oh, man, do I need to tear down walls and do things?

Yeah, designing for it structurally is so important so you can have that shaft that goes up without a whole lot of back-end work. Oh, that's pretty neat. Yeah, that is it structurally is so important so you can have that shaft that goes up without a whole lot of back-end work. Oh, that's pretty neat. Yeah, that is kind of interesting. Have you seen, I happened to see something this morning, purely by accident, it was actually Keith Smith from the Real Talk where Keith Smith had shared it, that a lot of people are purchasing multi-family homes. In other words, it's not multi, no, multi-generational, I should say,

where, in other words, have you begun to see people designing homes that can now incorporate an aging family member or parents at a later date? Yeah, we do a lot of that. So whether the family is all moving together in the house we're actually designing or whether they're designing for a potential future we do a lot of spaces that will give enough privacy and yet have family very close by so is that more like the just is it more like the in because i remember i'm just thinking of in new york we have family members that have they have their house but like on the side they have a stairs and it leads to another room that you can't get one to the other from the interior.

Is it more like that or is it more like you can get to there from the interior, like there's a way in and out, but everything that they need is kind of like on their end or something like that? We've done both.

A lot of people tend to incorporate it into either a suite downstairs in like a terrace level basement, like a walkout basement, or people are incorporating it into a garage building. There are some people, I think one of my partners is working on one right now where it's a totally separate structure. So you wouldn't be able to access it from the interior, but it's right there on the property beside the main family house. Interesting. Okay. I was kind of curious because that was my always things like,

do people like more privacy? Because it's like, it's got to be somebody's in-law. So it's like, does that, how does that play into the family dynamic? It really depends on the family. Right. It depends. But I was just kind of curious because in New York, they're all like separate. Like it's privacy and then you have to go go up and down stairs, and that's it. In Europe, sometimes they're very much like that one.

My wife's family in Europe, it's kind of like that. The son had moved, her uncle had moved into the old family home. But when I say right up the hill, I mean like 50 feet away. Her grandma, they built a small house like a guest cottage kind of like a guest cottage but you literally it was a stone's throw from one door to the other

but it was a separate building that kind of matched so you kind of just you built something that you wouldn't have built it just you wouldn't have built it by itself to house someone, but you did it for grandma so that she can be there. I mean, we've done some where it's really the same living space for the different occupants, but one wing, like the primary bedroom wing, is just a bit larger than normal. It has a sitting area. It has a small coffee bar area.

So there is that privacy when needed, but they still primarily share the main living space, kitchen and living room, et cetera. I like that because it's like a hotel. You get your coffee. Because I know it's one thing that everyone wakes up differently. All the people that we know on the older side start getting up early and earlier, and they go for their coffee and then you hear clanking because

they can't hear anymore so they don't realize they're being loud they're like i'm being super quiet there's all the clanking and they're like i think somebody's up right that's pretty clever yeah that's right yeah that's kind of neat that's how you have your own call yeah especially that like the first thing you do in the morning have a a cup of coffee. You wake up early. That's what you want. Yeah. That makes complete sense. So from a procedural perspective, so let's say people are interested. What kind of a process when people reach out to you?

I mean, let's say, I mean, I'm sure you do commercial, you do multifamily. Those are probably their own universes. But from a residential perspective, what kind of the process when someone reaches out to you? Yeah, so for all of our clients, really, across the board, we'll have an initial meeting where we want to hear what's your problem. What's the problem you're trying to solve? And so we like to give as much helpful information as possible, even with that first meeting, before we sign anything. So we know we're clicking well, we know we're on the same page,

you know we're listening to you, and the things that you need. And then really from there, it becomes a series of meetings just to connect, make sure we're on the same page. Some people will have physical images they like to share with us. Now with Houzz and Pinterest, people can just pin images. We like to direct people to Houzz only because you can write comments under the images you save. So we know whether you like that wall color, but you don't like that stair. Or you like the built-ins there,

but you want them a different style. So the more input we can hear from you about the things you like and the styles you like, the more we can really understand on a deeper level. And do you help people in those initial stages? I would imagine one of the biggest questions, of course, is that people come into it with ideas of what they'd like, and then it's like, but can we afford everything that we want to do?

Do you kind of help them early on? Obviously, you can't until you get a contract involved. You can't know, okay, this is the final price. Do you kind of help people say, just so you know, here's kind of where you're leaning? Because it's probably, I would imagine it's probably similar to real estate where, you know, when you go to buy an existing home, if you're the buyer, you're like, oh, I should be able to find a home for this price.

And of course, if you're the seller, like, well, my home is clearly worth more, right? So it's actually, I mean, I think a lot of people find it difficult to figure out what the value of a house actually is. Yeah, absolutely. And so do you try to help them kind of work through that? Yeah. So we'll try and prioritize the things that you're requesting and help you figure out what needs to stay in the budget and what are things you can compromise on that we can figure out a solution that's close, but that fits better into your budget. And that's why we like to get contractors involved fairly early in the process.

Even with our multifamily and commercial projects, we prefer to know who that contractor is early on because then we can really work as a team. And I really like working as a team with these guys because we're going to be involved in the same project for months, if not years for some projects. So everybody has their specialty, everybody has their input, and being able to listen to everyone and form a team really gets the best product in the end. Now, I have a question. How early do you prefer

to get on for something like a residential project? Because I know, like, there's people that, I was once having this conversation with a friend of ours who's a realtor and I was like let's say somebody wants to to build a house or like they want to go buy a plot of land do you hype it just even just from a hypothetical standard would you prefer to see it this way you can say don't don't buy this piece because there's nowhere to build it so you yeah absolutely you're already saying yes I'm like yeah we've had some clients that have brought us in that early in the process. Normally when people come to us, they have land. They have an idea of what they want.

But the clients who come to us before they purchase their land, we're really able to look at what the grade is doing and how they want to situate their house there. We can look at the sun orientation, which is really important when it comes to building science and environmental design. Being able to take advantage of the sun angles is really important, and that can really affect the way you want people to approach your house. So the earlier we can get involved, the better, although it's not typically the process, except for multifamily. We get clued into that early on multifamily projects a lot,

which is helpful. Yeah, I mean, it makes complete sense. You did involve, there's more pieces where your advice can then come into play, whereas, you know, I've already started building. It's only so much. For commercial, for apartments and such, we do a lot of

feasibility studies for lots that just can tell people, you know, how many units are you even looking at, the parking situation, and we try and design with a site as it is rather than trying to look at a flat site. So really that can save money by retaining walls. A lot of people try and flatten a site when they're there and you get these large retaining structures, but if we can design from the beginning and figure out where things can step and that can make

the process just a lot better in the long run. Yes, save them some future headache, but also take advantage of maybe the interesting things you can do with the land if you don't just cookie-cutter it and flatten it. Right. One of my favorite projects, which I wasn't involved in because this was before my time,

but Stone Creek Village on 20 South near Monticello High School. My team, my company did that before I was part of the company, but I love how that sort of builds up the hill. They took advantage of some of the parking under the buildings. Even the pool took advantage with the disappearing edge. And really from 20, from that intersection of 20 and Monticello, it's gorgeous. So that's one where I think that was really successful. And sadly, you so much, it's very, I've driven by there and it's always the same as you kind

of see it rising. It's almost like somewhat like like a castle the way it kind of just goes up yep yep up the hill there and it just then you wouldn't be able to do that if you just said ah no flatten it exactly so you lose a lot of the character of the place I think absolutely well Adrienne this has been so interesting I always I've learned I've learned a lot and just have a great appreciation for for what you do. If people are interested in reaching out, either commercially or residentially or multifamily, what's the best way to get in touch with your firm?

Sure. So we have offices in Charlottesville and Harrisonburg. And so our website is thegainsgroup.com. So that's T-H-E-G-A-I-N-E-S-G-R-O-U-P.com. And you can reach out through the website or we have a fairly active social media presence on Instagram and Facebook. You're more than welcome to reach out there

and we'll make sure we connect you with the right person for the project you're looking at. Fantastic. Fantastic. Well, this has been an absolute pleasure. Thank you so much for coming on. Thanks for joining us. Thank you for having me. I've enjoyed this.

Same here. Same here. Thanks again. Hopefully we'll have you back in the future. That would be great. Have a good one. You too. I don't know.

Just one of my favorite things is just learning about each of the different. Although I have to admit it reminds me of how when we were in Rome one of our tour guides was like you see that whole area up there and it's because the Romans had taken one of the hills, the emperor he just flattened the hill so that he could put his palace on it and it was just like he just take the whole top

off but it's so interesting because even with them like design because I remember there was a wall in Germany and they were saying that you could tell two different architects worked on it because one half of the wall snaked and worked its way and worked with the natural landscape to grow. And then there was another guy that came in

and was like, no, it goes in a straight line. And it's literally just a straight line because it doesn't matter, you flatten the hills, you cross the bridge, you do whatever you need to make it straight. You cross that bridge. So you see like,

if you look at it from like a topographical perspective, it's going you look at it from, like, a topographical perspective, it's going like this, and then it's like, boom! It's like, well, that's the Romans. You have one guy that's like, no, we work with everything, and then there's the other guy that's like, no, it's straight all the way. No, it's just, it's a beautiful thing, and it's just, I've always been fascinated by

how it's a combination of, it's a combination of your kind of math foundational you know, make sure this holds together and but also your beauty, your design, your art I have to admit, from the art perspective for me, I would definitely say it is the one

that combines the science and art the greatest, by necessity but also that makes it all the more impressive when you can do that so be sure to check out the Danes Group Architects. It's easy to find on Facebook. In fact, we're streaming there now, so you're not there. And thedanesgroup.com. Be sure to check it out. Switching gears

just a little bit. I'm going to let you choose which chart you want to look at first. Let's start with some of the delinquency chart, and then we'll move to the crypto. We'll end on a slightly more interesting... To be fair, I'm not positive that that's a positive chart. Yeah, but it's not quite as... But my reason for putting it is because I actually thought it that's a positive chart. Yeah, but it's not quite as... But my reason for putting it is because I actually thought it was not a good chart. I mean, it's good for crypto.

It's just not good for everything else. But anything, if we're going to start with delinquencies, then... I think what we want to just, I mean, just news-wise, I think we've kind of, not to harp on it, but we've been talking a little bit the last few weeks of, when we've had finance topics, Michael and I talked about it a little, Xavier and I talked about it a little. Are you ready for it?

Because I'll tell Judah which one to do. Judah, the black chart, please. I did not name the charts when I said the Judah accidentally, but Judah named them himself, and so we are going with those. Because we've been talking a little bit about, you know, what are the underlying currents that we're seeing in the economy. Because obviously the plain old-fashioned GDP number has kind of been buoyed by consumer spending being resistant to inflation, essentially. But I think charts like this show you.

So this is a chart of 90-plus-day credit card delinquencies. Of all ages. And it shows you credit card and auto loan. So the blue line is credit card. And the green line is auto loan. And you can see, so it starts in 2003 and it ends basically at the end of 2023. So what you can see here is. So you can just see the spike just quickly.

You can see here is... paid off a lot of things that they had, right? I think so. I mean, that was... But the problem is now we're starting to see... And you stop also collapsing spending. Yeah. If you collapse spending, you collapse credit card debt. Yeah, because you're... And a lot of... Because a lot of people were both being paid through. I think that's one of the things that we saw

is that checking accounts went up way more than just the $2,000 because it wasn't just that the stimulus gave you $2,000. Which were the things you're not spending. Some people were also... Think about it. Some businesses were continuing stimulus gave you $2,000. Which means you're not spending. Some people were also thinking about it. Some businesses were continuing to work and get paid just remotely. So if you were still cashing paychecks and you got a $2,000 stimulus,

you were able to wipe out a lot of credit card debt and auto loan debt. But now, as you can see from this chart... I mean, it surpassed those 2019 levels. Yeah, and a lot faster. So I think what this does show is, in other words, headline numbers like consumer spending can mask the fact that that spending, because consumer spending and GDP, so GDP, gross domestic product, that measures activity in the economy.

It doesn't really care, GDP or consumer spending, where that activity comes from. In other words, did you finance that activity from your paycheck? Did you finance it by pulling money out of your investment accounts? Did you finance it with credit card debt? Did you finance it with a loan chart? GDP doesn't care. Through gambling. You made a good bet on the World Series.

GDP doesn't care. GDP and consumer spending don't care where that money came from. But where that money came from is a leading indicator. It does tell you what may happen in the future. Because if that money came from, well, hey, I'm making more money than ever before and prices are really low, so this is great. Well, that's a sustainable future, right? If it came from, well, I'm just racking up credit card debt, that's unsustainable. You can't keep doing that forever, but just soon enough, you're unable to pay for the interest, and what happens?

You begin to have delinquencies. Right. Which in these days, a delinquency is like, in other words, failure to pay after 90-plus days. Right. Right. Right. And so what this is indicating is there is going to reach a point in which consumer spending cannot hold off the inflation. And that's kind of why I think you saw the Federal Reserve just a few days ago, Powell, basically saying, look, we have no intention of decreasing rates anytime soon. Right. But as he's sitting there saying as bad as this is from a,

as bad as high rates are from a mortgage perspective and from a sucking the life out of the economy perspective, he cannot, with inflation where it is, they cannot allow it to continue to increase month over month. So the tricky part is, I don't know, this morning, there were some layoffs surged in February to the highest level since 2009.

And that's not surprising in the sense that when you begin to suck money out, as high interest rates do that, when you suck money out of the economy and you you end up with people who are not able to

balance that out with increased spending, you will begin to have layoffs. Businesses must shrink. They have to respond to either decreased demand or increased costs. Interest rates is part of their cost.

Your smallest, smallest business may not be borrowing, right? But almost all large to giant corporations borrow. And when you increase their borrowing costs, you increase their costs.

And higher interest rates increase their borrowing costs. So we're seeing those challenges that the longer inflation goes, if the consumer cannot continue to compensate for it, you will see the economy struggle in other ways. So that's, I think, the issue that we may be seeing. Okay. Now, here's a question for you that just came to me, so it's coming out of nowhere. No, because I can't remember. So even though I'm the history guy, I can't remember, do recessions solve,

are there cases where recessions solve inflation problems? And I'm trying to think of one. Where recession solved? Yeah, where it pulled back on inflation rather than the opposite. Basically 1920, 1920 to 21. So the depression of 2021,

you have massive inflation coming out of the Woodrow Wilson years. So I mean, you're talking by 1918, 1919, inflation is... No, there was massive inflation. I mean, shirts, like cotton – No, there was mass inflation. I mean shirts like cotton dress shirts had reached $40. And remember, this is $40 in 1920 money. Right.

So I don't even want to know. Basically, the equivalent, imagine like $500 for your average shirt, and it's increasing throughout the day. Right. Right? So you have massive inflation. So what happens, the Warren G. Harding slash Calvin Tulish, because Harding doesn't live too long, administration. It was only a couple months, but he had done a lot of the major things before him. But he did a lot of the major things, which Calvin Tulish continued.

Warren G. Harding, Calvin Tulish, basically they instruct the Federal Reserve, not instruct, but like the Federal Reserve is independent. They heartily suggested to the Federal Reserve. Yeah, the Federal Reserve basically jacks interest rates up tremendously to squash inflation basically saying let's pop this bubble the harding administration says we are not going to do anything to prevent a depression in other words we need to let the economy reset yeah they do absolutely nothing i think they like they cut taxes and spending right they don't even spend any money to compensate

for the depression. You get a basically 25% unemployment rate. Depression prices plummet, but within 12 months, it's over. And the economy, then you get the roaring 20s. That's basically the last time, because the Great Depression was

rather different. I don't know to what extent inflation was a driver beforehand. I don't believe it. See, that was the thing. I was trying to think. I don't remember if the Great Depression was rather different. I don't know to what extent inflation was a driver beforehand. I don't believe it. See, that was the thing is I was trying to think. I don't remember if the Great Depression had an inflation issue as well. I know it did in the Weimar Republic, but I don't know if America had the folks. And then when you get the 70s Depression, that's statflation. That's the example where you can have both a recession and high inflation because the money supply is out of whack.

My concern is that we probably resemble... More of the 70s. In other words, there is no indication that we are going to cut spending and allow a depression to crash prices. At which point, if you're continuing, if you have on the one hand the Federal Reserve trying to quash inflation by sucking

money out of the system and making it difficult for businesses to operate, but on the other hand you have Congress just continuing to print money, essentially. You're not really lowering the money supply. You're not dealing with what may be one of the drivers of inflation.

The funny thing is, I'm almost, and I know a lot of people are very critical of Powell for raising rates, but at this point, if he's being so criticized, I almost wonder why he didn't raise rates even more. The problem is, I almost wonder why he didn't raise rates even more. Just like raise rates to – because the problem is I've always had this idea that if you're going to do a half – half measures are worse than full measures. Like if you half – if you raise interest rates, but you don't raise them enough to quash inflation, but you raise it enough to be painful for everyone.

It could be thought he had. But the issue is also do you – yeah. Do you jack them up so much that you definitely take care of inflation and be like, I did my bid and that's what I was supposed to do? But then you've got to deal with people saying you brought mortgage rates to 10. I mean but he's – but people are complaining that he brought them to – at the point which we even got to five or four or five, people were complaining that he brought them up. So my point is if people are going to hate you for bringing them to five and it doesn't solve the problem. You might as well solve the problem and then say, at least I solved the problem. But the question is, I mean, I guess you could argue

to play devil's advocate, right? Would he even have solved it? Because if he does that and then people are like, oh man, times are really tough because interest rates are at 10, does Congress just go and spend, well, don't worry, we'll make it better for you. We'll spend a little more money. I mean, that's the catch, but also it's one of those that like there's got to be a point at which interest rates are so high that

congress can spend all they want but nobody's borrowing because like it doesn't matter you're not going to borrow and spend money i mean they could load money and then people just pocket it and then that's it to be fair a lot of the money wasn't even staying domestic anywhere although apparently the republicans were arguing they would come back around. If you're giving money to other countries, that was one of the things they said about Obama's administration that he spent so much money. But a lot of it went into other countries and other businesses

so that the money immediately left America. The shovel-ready jobs thing wasn't true. A lot of the businesses that he was funding were overseas. So you don't get the hyperinflation because all these corporations were using the money overseas, so the money was being sucked into the global economy,

and so it didn't cause an inflation problem immediately, it just caused a debt problem. Now you're looking at a situation where, if a lot of the money is staying in the mess door of everyone else is having inflation problems, you're just at a situation where if a lot of the money is staying domestic or if everyone else is having inflation problems, you're just making everything worse. So it's a very sticky situation. It's not easy to solve.

As he recovers, he's watching the show today. He says in the 70s GDP was better than today. That's true. Which is just saying something. The question is how did we get this inflation rate? You know, and he thinks energy is a major problem. Oh, no.

I think so, too. Wasn't it in the 70s, though, too? Correct me if I'm wrong, Xavier. Oh, it didn't? We have part of the world? Yeah, there was a world crisis in the 70s as well. But, I mean, and that's part of it, too, is you have to move stuff from one place to the other. No matter how digital, like, you can buy a house. Again, not a house, you can buy a book on Amazon, but somebody's still got to ship it to you, and that costs oil.

And, of course, if it costs oil, then the price of oil is going to be a factor in the price of the book. So it doesn't matter. The disappointing difference is, let's face it, in the 70s, we did not know that we had the supply to actually counteract OPEC. Today we do, we're just choosing not to employ it, in a sense. And our reserves, I saw a graph, I was going to send it to Judah, but it was way too

complicated, the way it looked, the reserves, and they did it graphically so that the countries that had the biggest reserves were larger on the world map and the countries with the smaller... So, of course, it was interesting to look at, but the problem is I don't know how it would translate on the screen.

But one of the things that... The US is one of the smallest countries for... Yeah, I mean, obviously, you have got places in the Caribbean and Africa where they're minuscule. And, of course, the ones that make the most oil, like Venezuela, have the most. But Venezuela hasn't been shipping recently. Their output has declined.

They just have a huge reserve. Saudi Arabia has a huge reserve, so, of course, that makes sense. But then you're looking, Canada has a larger reserve than we do. And you're like, Canada doesn't produce as much oil. Like, we have the capacity to produce more than Saudi Arabia, and yet our reserve is lower because we used our oil reserve to quash it immediately.

We've been spending out of the reserve to keep oil prices down. Right, rather than just making oil. Not making oil, but drilling for oil. That's one of the challenges. There's a lot of challenges and of course obviously there's listeners with environmental concerns,

but there's also the economic environment, and that also is unfortunately being exacerbated by the lack of oil. Oh, exactly, yeah. I mean, there's tradeoffs with everything. I mean, everything has a tradeoff. Like you have to sacrifice. If you're sacrificing, I understand you're sacrificing the economy, but then at the same time you have high oil prices,

and you say what is the cost at the same time? And how is that impacting other aspects of the economy? While Xavier sends another question, maybe we can show the other. Oh, is he sending another question? Yes, he is. I can see Xavier is typing. Okay, so we're. He asks, how does all of this impact the markets?

Well, shouldn't he come on and... He's a co-host of Today on Air. He wants the crystal ball. I don't have a crystal ball. He should be on to do this. Because in 30 years, if he's wrong, who knows? What, 100 years old? He'll be fine. It's the perfect. If I'm even 30 years old and people are like, you were wrong.

I think the challenge is that the markets it depends it always depends what the markets are looking at because in theory you'd say, well, the markets if they were to respond to lower economic growth, right, then they would respond negatively. But if the markets respond to this by

saying, hey, things are getting bad, Federal Reserve might lower rates again and turn the spigot back on, then you might see the opposite effect. You might see, in fact, the markets, the equity markets rally and say well, if the spigot's going to be turned back on, and if the money will

flow again, then that's good for... We just talked about, again, the Obama administration had the worst recovery in U.S. history, economically speaking. But the stock market did great. So you sit there and you're like, how does that – I mean, one thing is, though, at the same time – Well, it was free-flowing money. Right, that's part of what it is.

Interest rates were low for basically almost a decade from 2008 to – And you saw a lot of mergers and buyouts. And one of the things I saw, there was a gentleman who was an economist and he said part of what happened is that following the bombing, it was so low, the price of borrowing, that you were better off buying out your competitors than...

Or buying back your own stock. Or buying back your own stock, buying out your competitors. So what happens, a lot of these major corporations had all of a sudden huge revenue growth because I can just buy, instead of having a competition from a smaller business that could do

something better, you just borrow money at 0% interest and buy them out and of course if you make anything over 0% you're making money off that deal. So there was buyouts and mergers galore, and all these companies started getting larger and larger and larger because they were being fueled by an economy that had 0% interest rates,

but wasn't growing. So, of course, the stock market did great because the bigger the companies were, the better they did. I think the key thing there, right, because Xavier makes this point, the key thing there is, from an investor's perspective, it goes to show that you need

to remain in the markets. You can't be sitting there trying to figure out what direction it's going to go, because you could be in the midst of slower economic growth and yet experience some of the biggest days of the stock market that you don't want to miss out on. So it just goes, he says diversification,

which is really the key. You want to be diversified across the markets because you're not going to be able to predict which one is going to go up or down. When Xavier's not on the show, he's like your fifth grade teacher where she knows the answer, but she wants you to come up with it yourself.

And then when you come up with something original he's like no you should have said diversification which he's right I was just saying it's kind of funny because like we went in a completely total different direction he's like no you got to stay in the markets like that was the that's what he was leading us to he's correct of course

and Alex and I both agree that you stay in for the long haul because you know you don't know where things will go. Like a bad economy doesn't mean the stock market would do poorly and vice versa. Actually, maybe I'll do that chart next week, but I actually saw somebody was doing a chart of the Magnificent Seven versus the rest in the S&P,

and it goes to show that a lot of the stock market recently has just been driven by the seven largest companies, which I don't remember. But it was the opposite two years ago when they pushed everything down. Exactly, right. So, I mean, catch point two, if they form, and of course the larger portion of the S&P that they form, if they start

to perform poorly and everything else starts to do well, then, of course, then you're going to have the opposite effect where it looks like the economy, the stock market is struggling, but in reality it's like the stock market is struggling. But in reality, it's just the Magnificent Seven. Everything else is catching up. So we really don't know how that is going to be.

Do you want to talk about it? Yeah, that's true. At the speed of the market, this is a particular market that has moved dramatically. So white chart, please, Jeter, when you have a moment. And so the chart you're going to see in a moment is inflows to crypto funds. And so inflows meaning how much money is going into crypto funds. And you will see a massive spike in the beginning of this year

after basically kind of flatlining and if anything, a bit of a negative period in between 2022 and 2023 see i found this chart concerning i know you you you you find it interesting it's i wouldn't say i was just saying it's not a uh oh my goodness bad news chart i find it what could this mean so my the reason i'll say this the reason i found it concerning is because there has been a lot of discussion especially among investors about what role crypto will take in the future. One potential role that they had speculated on following the pandemic was whether or not crypto was going to become the next hedge against inflation.

Now, obviously, looking at that chart, you can see that that clearly did not happen right that it didn't become this thing that everyone dumped into crypto to stay safe from inflation because you know inflation was much worse before and you can see that money was going both in and out and kind of was stagnant after a little bump right before 2022 but my concern is why is it that all of a sudden we're seeing a lot of entries into crypto and my concern was that people are worried about the volatility of either this, because I think it's not even just, if I'm correct, I saw somebody say that this year's election cycle isn't just big for the United States. There's a tremendous amount of elections

happening around the world. So there's going to be a lot of global shifts in political agendas. And so is it just that people are concerned about the future for 2024 or is this another leading indicator that we are not yet aware of because crypto hasn't been around long enough that people are concerned about the economy and they say one thing that is not tied to the the economy is a cryptocurrency right because it does not function it does not function based on how who's making

money, how many companies are making money. It is its own thing that it's dependent. I don't even know what its price is dependent on at this point. Well, crypto's price, I think, for the most part is dependent on, right now, it's dependent on speculation. In other words, it doesn't

produce anything. I mean, there's no produce anything. There's no physical production. It's not tied to gold. It's not tied to anything. It's not even a fiat currency. It is not dependent on the ability of a government to pay their debts. It is

its own thing. Crypto is literally worth what the next person will pay for it. Essentially, from an investment perspective. The question is, the interesting is, like you said, what does massive movement into cryptocurrency foretell? Is it merely an economic sign? Is it a sign of economic uncertainty? Is it a sign of, is it becoming an inflation hedge? Do people think it's an inflation hedge

even if it might not have been over the past few years? I mean we've had plenty of people suggest that it's an inflation hedge even though when you look at the numbers that clearly hasn't been the case. But I think also the key with crypto is that it is, I think it's as much a political barometer as an economic one. In other words, I think because of its selling point as, which, granted, you and I know,

if you open up a Coinbase account with your name, right, and you buy crypto in it, you're not anonymous, right? You're not, Coinbase knows who you are, and therefore banks who are connected to Coinbase know you. And if you use an Apple phone or Lenovo or Gmail, they all know as well. You're not anonymous anymore. Exactly, you're not really anonymous, right?

But crypto has the, I would say, the reputation of being, well, I can buy what I want with it. It's not dollars. Maybe I won't be tracked. It's peer-to-peer encrypted, right? I think crypto has this sort of persona around it of if I think things are getting a little crazy,

maybe I want to be in crypto. And so the question is, do people believe things are getting crazy economically or do people are just worried about uncertainty from a political level? Yeah. and i think that is the question is what what exactly is this foretelling it's difficult to say but i found it a fascinating chart because this is a movement of a size that we have not seen in at least from this chart you're talking six years we have not seen a movement anywhere near this size and this this movement is double the last biggest movement we had i think more than double

if i'm looks like more than double yeah the last biggest movement we have had which was in 2021 to 2022 also interestingly uh prior to an election year even though it was a midterm year but I think that's the question it's always interesting to kind of speculate and think about what because like you said crypto has not been around long enough for us to reliably say it is a leading indicator of X well it also it's weird because it's one of those things

where we don't know what it's going to eventually indicate. Like, eventually, it's going to have some role in the economy in some sort. Like, it's either going to be a hedge or it's going to be an indicator of volatility. It's going to do something because people are eventually going to rely on it for a certain reason

because it's going to start correlating. We just don't know what that is. But we don't know what that is yet. So the question is, is it a is it an uncertainty indicator? That's what you seem to be suggesting is that it could be a political... That's probably my guess at the moment.

And to be fair, that would look... And Xavier made a good point. Obviously, one also thing that has changed in recent years is the ability to invest in it using ETFs. So in other words, as it becomes more accessible to invest in crypto, do more people do it? In other words, are there people

who are putting money into crypto now who weren't doing it before, but before you had to open a Coinbase account, you had to do a currency exchange, but now you just go and buy an ETF, which he feels may be the scarier point. In other words, are there going to be people that are encouraged to do this

when maybe their risk tolerance would suggest that they should not? Maybe. It's the cool new thing. It's been around long enough. I don't know if it's still the cool new thing or just people feel safer. It's almost like gold.

We see a lot of people who talk about is gold a safer option? Of course, there's a catch-22 to gold, which is that you've got to pay to either store it or the ETFs can be very expensive to hold gold. Then if you go with gold miners, rather than then you're relying on a business, not necessarily just the price of gold,

because then there's another layer of risk to that. So there's a lot going on. I mean, it's true, if it's easier to buy, it's easier to get in and out of, but does that mean we're also going to see a stronger correlation with something that materializes because more people will be like how many people would have been like, ah, Trump versus Biden, what are we going to do after another Trump election? How do I hedge against the volatility

of this pandemic thing and all that? And they wouldn't have been able to do it to the same degree they can now. And now we're going to start seeing it form a pattern. Or maybe even on the inflation hedge thing too. I mean, how many people, I mean, we always hear gold is an inflation hedge but how many people like buy gold over the counter in the old days I mean only certain amount of people were doing that yeah would have done that so it'll be interesting to see

where where it goes from here yeah maybe the maybe it'll start having a personality of its own in the markets. You never know, never know. So an interesting chart. I would say the key thing also to keep in mind with crypto is, I always ask people this, if you're thinking about it, you really need to ask yourself why. In other words, what, if you're saying, oh, should I buy a crypto ETF? Oh, okay.

Ask yourself why. I think you said why the chart was going up. Why do you want crypto in your portfolio? Because anything can be a good or a bad investment. It depends on what your goal is. And so it's not as though crypto is always a bad investment or that it's always a good investment. It's what are you trying to achieve? Right?

And so if you're like, ah, well, you know, I just want a little growth in my portfolio. Is crypto, if you're going to retire in five years, is crypto the way to do it? Should it be a significant part? And then if your answer is,

well, no, I want to be able to, you know, buy things but without being trapped. I want to be anonymous. Right? I want to get away from the system but without being tracked, I want to be anonymous I want to get away from the system well then buying a crypto ETF does none of that because everyone knows that you own the crypto in other words you're not anonymous, you're in the system so it really depends on what

is your goal so you really need to ask those kinds of questions particularly when it comes to more esoteric investments like crypto currency or like gold if you're interested in gold, ask yourself why. That's what was on Jerry's show that Judah once made the great point with the

gold bars that I like to use. You'll see people say, well, what if everything collapses? I want gold. And Judah said, what are you going to do? Shave off? You can't buy the chicken with the gold bar. It's worth too much. And what are you going to do? Shave off pieces of gold to give to someone? So in other words, what is your reason?

If you're worried about that, you need to be the one that owns the chicken. Exactly. My point has always been don't be the guy that's like, I'll buy everything from everyone else because you're target. You either need to be the bully and just, I guess, whip in stock, steal stuff and rob everyone, or you've got to be the guy that owns the chicken. That's really it.

You really need to think about what you're doing. I was going to say, think about the gold rush, 1849, in California. We grew up on this because we grew up in California. Who made the most money wasn't the gold miners. It was never the gold miners who made the money. It was Levi Strauss who made jeans. It was the guy who made

the guys that sold the chickens. It was the guy that owned the tavern. It was the guy that sold the money. It was Levi Strauss who made jeans. It was the guy who made the guys that sold the chickens. It was the guy that owned the tavern. It was the guy that sold the pans. Those people made the money because everybody needed those things and not everyone was finding gold. So you got lucky if you found gold, but nobody had to get lucky selling food because everyone needed to eat. So if you're really worried about the apocalypse, don't start looking at cryptocurrencies and gold. Start looking for chickens. I mean, that's really it. I mean, if that's really what you're worried about,

own the chicken, not the gold. Exactly, exactly. So it's always about why are you looking at it, what is your goal, and that will determine whether it's a good investment. Hence why you should talk to professionals who can help you ask those questions. Exactly.

Well, this has been interesting, Joe. I feel like we covered a lot of different things. I can help you ask those questions. Exactly. Well, this has been an interesting show. I feel like we covered a lot of different things. I'm glad you liked the charts. I did like the charts. Always fun to have Nick on with some interesting charts to talk about. Always fun to have Xavier giving us some great questions and tips. That was far less fun than the charts. All our guests that tuned in today.

Definitely appreciate having Adrienne on. Be sure to check out the Gaines Group Architects. Next week, we're going to have Joy Ting Wine. Yes. She's a research... Joy Ting with Joy Ting Wine. Yeah, with Joy Ting Wine. And Matthias, the Unreal team.

She's going to be coming on. She's a research... Enologist. Enologist. Enologist and exchange coordinator team. He's going to be coming on. She's a research enologist. Enologist. Enologist and exchange coordinator. So that's going to be fascinating. And Matthias, going to be our monthly meetup with Matthias. Oh, an enologist throws you off, right?

Yeah, yeah. I was like, is that spelled wrong? Should it be ecologist? No, it's enologist. Yeah. Enologist. We'll have to, in between now and then, I'll have to research what that is. And then Matthias, you're going to be coming on for our monthly meetup with Matthias, which is always a great time.

So be sure to check that out. Appreciate everyone tuning in today. Thanks for being here with me, Nick. You're welcome. Thank you for having me. Always good to have you on. Thanks to Judah behind the camera. Love being here on the I Love Siebel Network set.

Thank you to our great partners, Matias Yon Realty Credit, Sirius Insurance, Forward Adelante. Thanks to our presenter, Emergent Financial Services. Thanks to all of you who tuned in and joined us. We look forward to seeing you next week. But until that time,

hasta mañana. Thank you.