The I Love CVille Show With Jerry Miller! - Michael Urpí & Xavier Urpí Were Live On "Today y Mañana" On The I Love CVille Network!

Episode Date: February 27, 2025

Michael Urpí & Xavier Urpí were live 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, Matthias John Realty and Charlottesville Opera, with Forward Adelante.

Good morning everyone and welcome to Today and Manana. I'm Michael here with Xavier. We have good news. It's finally starting to warm up. Xavier was thawing out yesterday like Captain America. He's emerging from the ice, coming up. Well, you know, it's interesting, but it does provide a certain, at least for me, it does provide a certain amount of energy. Like maybe because of, you know, as you get older,

you just don't like the cold that much. But the idea of going out and doing outdoor work when it's cold, it's just, you know, it's miserable. I don't feel like doing it. As soon as it warms up, it's different. You're able to kind of go outside, and the sun just feels so nice on your face, and it feels like it gives you energy. And the second thing that I love is in the morning,

because, I mean, let's be honest, like the past, before this week, the past like four weeks, I mean, it's like the past before this week the past like four weeks i mean it's like you got up and you're freezing in the morning it's like you got up i was getting up in the morning i was like it was kind of chilly when i was going to work by the time i got to work i got out of the car i'm like it's already feeling warm like i'm not like freezing it's like oh thank god don't have to wear my gloves when i'm driving on the steering wheel it's like okay this is nice you know it just it does provide you with energy it's like you're going for a walk, you're like, ah. Yeah, especially when the sun's out. When the sun's out, there's nothing like it.

But even today when it's like cloudy, kind of a little dreary, it's like at least you're not going outside. It's like you can look outside. Like the past few weeks, you looked outside, like I feel cold. Even though I'm warm, I look outside and I feel cold. You know, our mom, R.P., always has this thing. During the winter, she watches any movie, even during the summer. She'll watch a movie with snow.

She goes, I feel cold. Give me a blanket. It's like, this is the movie. But she sees snow and she feels cold. It's like that. Sometimes it's like you're in a studio and you're like, I feel cold. But it was nice to kind of go outside. It's like, oh, it's only like 50 degrees.

It's not cold at all. Yeah, it feels so good. It feels so good. It does, yeah. Warms you up. Gives you energy. Let's hope it's here to stay. Yes, a couple couple days more at least

yeah you know I think Friday and Saturday Sunday I think it's dropping again Sunday you mean yeah Sunday yeah it's dropping again oh well

yeah indoors day I know anyway as always we are happy to be presented by Emergent Financial Services and sponsored by our

wonderful sponsors Craddock Series Insurance, Charlottesville Opera, Matisse Young Realty. We don't have any guests this morning, so it's just me and Xavier, but I know you have a lot of topics you wanted to discuss and you were kind of like happy because

I know people have been a little nervous about the market lately, but you're here to kind of give people a little... Yeah, it's not so much... I mean, granted, January has come in and it's been quite volatile both on the equity side and fixed income side. And I think part of it is, I mean, like we've mentioned before, we've had two very good years in the stock market. And so we do have a new administration. There's

a lot of changes going on. And I think the markets typically don't like uncertainty, right? And so there's so much uncertainty out there. And there's news coming left and right, you know, those that say, ah, this is bad, and those that say this is good. And so it's probably somewhere in the middle, right? But the problem is sometimes you don't know what's going to happen until months from now and sometimes maybe six, nine months from now. And so the markets are digesting every little piece of information that comes out either from the administration or economic news and trying to figure out what does this mean, right?

And so we're here really to kind of explain some of the things that are occurring. And sometimes, like I said, you have to take a step back and say, you know, you can't take what you read, you know, to the bank and assume that that's exactly 100% correct. Well, I think it's interesting because we were talking about this in the call on the way here, right? You told me, like, they think the market for the year is up maybe around 1%. Yeah, yeah. You know, but if you ask people, they probably feel like, no, it's been down this year.

Oh, yeah. Well, it's amazing. People come in and say, oh, the market, you know, market's down. What are we doing? It's like, eh, market's not down. Market's still up, you know? Yeah, you know, but it's just been so, like you said, so volatile. It feels like it goes up 3% one day, down 4% the next.

It feels like you can't keep up. Was it up or down this week? I have no idea. Yeah. And I think that's part of it. You know, the other issue is we all have cell phones, right? And through those cell phones, we just get, you know, continuous information. And those that are nervous nillies will look at the stock market on a daily basis and read things.

And so that's what happens. They become really myopic as to what they want to look at. And then they become very nervous. And then they make the phone calls. Yeah. They can only see what's going on. What's going on? Now, I know you did give me a couple things you wanted to talk about.

So first, I got one about the economy and inflation. Well, I guess the numbers came out today, right? Yeah. I think GDP came out. I think you got the numbers. I don't have them right now. Oh, you don't have them? Okay. So, yeah, so it looks like GDP increased at an unrevised 2.3% annualized pace in the fourth quarter.

This was the fourth quarter. Yeah, okay. Yeah. Consumer spending advanced at 4.2% pace, but I think inflation was a little higher than they thought, right? Yeah. I thought what was really interesting about the number more than anything else is because we've been talking really for the last six months about the consumer, right?

So we know the consumer had a couple of years there that they just got tons of money from the government, right? So we know the consumer had, you know, a couple of years there that they just got tons of money from the government, right? And then they started tapping to their credit cards because credit card debt has skyrocketed, right? So it's over a trillion dollars. And so you sit there, you go, sooner or later, the consumer has to take a step back and say, you know, I can't, I really can't spend any more money because I don't have it. How does that get fixed? If consumers got like a trillion dollars in credit card debt, like how does that get fixed? Well, the only way, I mean, you can't fix something, right, like that.

I know. Because only the consumer himself can fix it, right? But the difference is, and we always talk about this, right, the government can spend money, right, because they just keep printing it. But a consumer can't really print money. It comes to a point where you max out on your credit card, so you have no more borrowing power. So now you have to live based on what you're earning, and remember, you now have to also pay down debt. So you get to that point where it's like you realize I can no longer go out and spend money like a drunken sailor, they always say, right, because I don't have any capacity to borrow anymore.

So that's when the consumer finally realizes, I need to pull back. And second of all, I've got this credit card debt that's being charged interest at 20% plus, and it's eating you alive. I mean, that's part of the issue. So the point is that you look at the numbers for the fourth quarter, and the consumer still was a very strong catalyst to the economy growing. And my point is that sooner or later that stops. And I know that incomes have also risen, right?

So there has been that that has helped the consumer. But you look at the differential between how much income has gone up over the last, call it four years, versus inflation, and it's nowhere close to what inflation has been. So there's been that erosion of your dollar that is causing you to really spend more than you're used to on products. And so the fact that you are maybe being a little frivolous in some cases will have to stop because you can no longer afford it, right? So that's the issue. So you look at, and the thing that worried me the most was really that the inflation numbers

continue to be a little higher than I think the Fed wanted them to be, right? And the Fed comes into this year, I think, looking at it and say, yeah, we were hoping to cut rates, you know, three, maybe four times, right? And I think they've pared down to maybe once or twice. And I think they're sitting there saying, we just don't know exactly what's going to happen to the economy because, yes, if you impose tariffs on different nations, right, those tariffs are somewhat inflationary at the very beginning, right?

And so is that really going to cause inflation to go up? Is it not going to cause inflation to go up? So, again, there's that unknown, right? So without that data coming back to us, which won't hit for another three to six months, it's very difficult for the Fed to say, hey, let's cut rates. And then they find out that, hey, you know what? Inflation is backed up to 4%. We've cut rates. Now we've got to raise rates.

So I think my feeling is they're probably a little better to pause here and see what's going to go on. What could explain that sudden rise of inflation, do you think? That it felt like it was trending low, and now it's potentially trending back upward. Just a little spike because of, you know. Well, yeah, I mean, there's, for instance, I mean, if you see what happened with eggs, right? So there's events that happen sometimes in the economy that, you know, cause inflation to rise, right? And I also think that there was still a certain amount of, you know, services has just been rising and rising and rising. And I think that's the area that really has caused the most, the most inflation

in our kind of economic package until, because let's face it with services you know you just keep you know there's always the excuse well you know because of inflation I need to charge more for my you know service right at the point where people say okay yeah and that's fine you know then eventually people say it was like well if that's the case I'm not just going to use those services anymore because I can't afford it that's the point where people say well I need now to cut down on my service costs because if people aren't coming to me that's not good right it. That's the point where people say, well, I need now to cut down on my service costs because if people aren't coming to me, that's not good, right? And again, that's the supply-demand curve, right?

In other words, you keep bringing up your price more and more and more up to the point where the consumer says, yeah, I no longer need that because it's too expensive. Now you have to bring them back down. So I think that's part of it. I think companies, and in particular services, have had a great excuse with the inflation, right, and say because of inflation we need to charge more, right? Think about it. And for good reason.

I'm not really bashing anybody here, but you look at insurance companies and their premiums have continued to rise, you know, dramatically over the last two or three years, right? And why? And it's because of inflation. You say, well, you know, how does inflation impact an insurance company? Well, if your house burns down, right, and presumably to rebuild that house was supposed to cost $200,000 and now it's costing $300,000, well, that insurance company has an extra $100,000 expense there that they never thought they were going to have. In other words, they never planned for that, right, on actuarial basis. So things like that causes them to say, I now have to increase premiums because I have to pay the extra $100,000 for that house.

Car has to be fixed. Well, I've got to pay more for that car. So all of that and the fact that, yes, we've had more hurricanes, you've had the fires, the floods. So these insurance companies have had to pay for a lot more, and more has happened. So, again, insurance companies raise their premiums. It impacts the consumer. The consumer says, what am I supposed to do? I need insurance in my house.

I need insurance in my car. I can shop around, but at the same time. You think disasters like the one we had in California and North Carolina affect that? Oh, yes. Like nationwide, though? Oh, for sure, for sure, because, you know, if you're, you know, Allstate or Farmers Insurance, and you have, you know, you have people that you insure in California or in Texas and Florida, whatever, all those events impact your company. So the answer is yes. Yeah, I mean, those rates will go up.

If there are certain local insurance companies, then maybe not, right? Not so much in the sense that if you're just a local Virginia company, which that's usually not the case, right, then those rates may stay a little lower. And just to quickly kind of circle back to the credit card debt, I'm curious, what happens if people start coming in and be like, I can't afford my debt payment on the credit card? Is there an option for them to declare bankruptcy?

And then what happens after that with the credit card? Or do you have to really kind of be out of money to declare bankruptcy? Yeah, I mean, declaring bankruptcy can cause a lot of issues, right? So you don't ever want to do that. I mean, your credit rating really suffers quite a lot and it takes time. So you don't do that until there's absolutely, you have no choice. I mean, it has to be a situation where

you completely lose your job and now you can't pay your debt and the only way to do that is like that, right? But there are ways to really, I think most people don't know this but if you call your uh credit card company and say listen i'm i'm just struggling i can't i can't keep up with this payment right um i'm getting more and more in the hole because you know the minimum payment that i pay doesn't do anything to pay down the debt can we negotiate something

because i need to pay this off in the end the credit card company would prefer you pay back debt right then you then eventually say hey i can't pay anything i'm done right yeah so so you can i think and i've heard this happen so you can call them and say can we work something out you know and they'll sit down with you try to work it out but what they'll do is kind of create it's almost like a mortgage right they'll sit down with you, try to work it out. But what they'll do is kind of create, it's almost like a mortgage, right? They'll create a situation where, yes, the interest rate must be lower, but now from here on you're going to be paying principal plus interest on a monthly basis to begin to pay down that debt, which is good.

And it might be, again, it's going to be much more painful than a minimum number that they always show you in a credit card, but in the long run, you know, it's good for both parties. So that can happen. So I highly recommend for people that are really in that kind of strain and situation, yeah, call the credit card company because most of the time they're more than happy. I mean, you've got to get beyond the person you call the first time. You've got to have a supervisor or somebody to be able to do that.

Well, I just thought it was interesting because, you know, there was a time when I think people were going under the assumption that the student loans were going to get canceled. And obviously now that's not the current situation. So you worry sometimes how much people are spending thinking, oh, that student loan debt, that'll get canceled. Don't worry. Like going under that assumption, then suddenly, well, now that's not going to happen.

So it's like, well, now I got to pay my student loan debt. And now also I have this credit card debt on the side. Yeah. Yeah. And sometimes people make the wrong decision and they're trying to pay off one debt. And it's like, well, I'll pay off the student loan debt first, then leave the credit card without looking. Like you often tell clients, it's like, look at which one has the higher interest rate and pay that one off first. Exactly.

You know? And it's so funny because once I read an article that said that most people have a tendency to look at their loans and say, you know, I'm going to pay my highest loan. I'm just going to pay that off, right? And so they look at what they, you know their their largest borrowing is typically their house right so they look at and say okay this is the one i want to make an impact right and so they start paying off and i'm saying no it's you don't look at it that way you don't look at which one you owe the most you got to look at which one's giving you charging the highest interest rate

and focus on that one pay that one off because that's where it makes the most sense but it's just so funny how mentally people say oh yeah i only owe you know fifteen thousand dollars my credit card and you know twenty thousand dollars in this credit card and you know a hundred in my in my uh student loan but man i own three hundred thousand dollars in my mortgage i gotta i gotta bring that down it's like no yeah that's the wrong move it's the other guys you gotta get out of the book right exactly exactly so yeah that down. It's like, no, that's the wrong move. It's the other guys you got to get out of the book, right? Exactly, exactly. So, yeah, that happens. Again, you know, it's always education.

And I think it's, I find it that the more you can educate your clients and people that you meet about kind of what is the right thing to do financially, the better you are, right? Because people sometimes, again, there's just so much information out there that you read that they might just read one thing and then say, oh, that's what I have to do without taking a step back and saying, you know, you've got to look at the whole picture and try to figure out what's best for you, right, as a person, as a family, that will impact you going forward on as far as your, you know, your budget, your savings, etc. Yeah. What about, I know this has been a topic on a lot of people's minds, the tariffs. I think

recently the Trump administration announced that they were doing reciprocal tariffs on Europe, if I'm correct, right? So anything that Europe's putting a tariff on U.S. products, U.S. products are going to put equal tariff on European products. And I also saw that they're also raising tariffs now on China, I think. Oh, no, 10%. I think you actually took it 20% today, wasn't it? Well, actually, another 10, so it would be 20. 20 in total.

So it's been 10, though, throughout even, like, the Biden administration. Biden administration. Yeah, but that was interesting because the other day I saw that Apple announced that they're going to invest like $500 billion worth of new infrastructure in the U.S. And I was curious, what are your thoughts on tariffs? Because I know people kind of get worried. They're like, oh, is this going to cause a spike in inflation? But I'm curious what your thoughts are.

It's like, okay, for companies now, what are we going to invest? Like Apple, $500 billion in America, at what point does that kind of take effect into the economy? Does the market suddenly jump up immediately on the news, or does it have to be some sort of progress that the market might react and say, okay, this is actually happening? Yeah. So that's a really good question, right, because as I mentioned before,

when these things happen, when a tariff happens, and the expectation, I think, is exactly that. If you begin to tariff another country to the point where the companies here say it's no longer beneficial to have a factory in China, Vietnam, wherever it may be, Europe, right? If it's no more beneficial to then have that made in those countries, it's at this point cost-effective to bring it back, right? There's a short period, there's a period of time there where you can't just, like, boom, shut down that factory and start building here, right? You've got to rebuild whatever you have to create here in the U.S., right? So you're still going to be importing some things, right?

And those things are going to be much more expensive because of the tariffs. So for a short period of time, right, you have that. You have that inflationary impact because, you know, that phone that maybe would have cost you $100 is going to cost you $120, right? So, yeah, now you've got to spend $20 more on a phone that you would have if it wasn't for the tariffs. However, over time, whether it be six months or nine months, those phones will be made here. And if I would say, you know, we're living in a time where because of robotics and because of AI, right, you don't necessarily have to hire, you know, labor, right, which is where it's expensive.

There will be some new hires, and I forget which company said they're going to hire 20,000 people here in the U.S., right? I think it was Apple, not sure. But you will see jobs come back to this country, but you'll also see the fact that, again, because of technology, there will be products that they can build here. Yes, initially you have to pay for those robots. Again, because of technology, there will be products that they can build here. Initially, you have to pay for those robots. You have to pay for AI. But you'll be able to create the same product at maybe even a cheaper level than you did back when you were doing it via labor in these other countries where labor is cheap.

And you'll be able to create this product, which may be cheaper. So over time, right, that product price will come down a little bit. And the longer it goes, the better it is because, again, robots can work 24 hours a day, right? And nobody's stopping them. And then you just got to make sure if they break down, you fix them, et cetera, right? So my point, there's still, I think there's a lot of products that when they come back to this country, yes, at first it may be inflationary. But over the next year and a half to two years, you will see that inflation number kind of fizzle out, coming down and coming out of the other countries and maybe start beginning to go down or at least stay level, which is what you're looking for. But the economy will improve, right, because you will have literally, you know, hired more people in this country,

which is what you're looking for. And I also, outside of economic terms, but you also have the feeling, too, like when things are made in China, it just feels like the quality is, like, cheap. Yeah. You know, and it's like you notice, I mean, people about that whether it's like refrigerators like washing machines they're like man it's like when i used to get like some sort of utility when it was like made in america it lasts like 20 years and then you get one from china it's lasting two years and everyone's like why is it that the one from the 80s is still working and the one i bought three years ago is already having problems and it's

and it's kind of funny you don't even think about. But in terms of kind of like how long a product lasts also matters, you know, not just the price. It matters. But I think, you know, and I think we're going to see this continuously happen, though. So the difference between the old products and the new products is not just construction, right, and quality of construction, which there is some of that, right? However, you look at an old washing machine. That thing was metal, steel, all around, right, and quality of construction, which there is some of that, right? However, you look at, you know, you look at an old washing machine, that thing was metal, steel, all around, right? So other than kind of rust, you know, it was just mechanical. You had to push a button. There was no sensors. There was no electrical equipment in there. Today, you've gone to much more, you know, plastics, which of course, yes, I mean, you look at the

ball bearings sometimes, and it's just like that plastic wears out to the point where that ball bearing is not being held anymore, right? The high speed that these, you know, especially like dryers and washers go. But the issue is the electrical components, right? I mean, it's happened to us, right? All of a sudden, it's like something's not working. Oh, yeah, it's the motherboard. Oh, okay. Yeah, that motherboard is like $2, hundred dollars or eight hundred whatever it may be but it's like yeah that's kind

of the almost the whole cost of of the washing machine right so it's like why am i going to bother fixing the mother the motherboard i'll just get a new one right so i think that's part of the issue is that as we go more to the electronic age where machines have become much more efficient right in a sense of yeah they sense when something's dry or they sense when something's spinning right etc there's all these sensors sensors break and it's more expensive right so i think that's part of it so in one way you're saving energy because things work better but on the other in the other side is like after like you said after you know five six years all of a sudden this breaks or that breaks.

And before you know it, you're changing your – I mean, I always tell people my mother had the same washing machine. I remember having gone to her house one day, and I have to go to the basement for something. I said, I can't believe this. I said, Mom, is this the same washing machine we had since we began? She goes, yeah. I said, unbelievable. I mean, it's like, you know, 25, 30 years old years old it's like how is that possible it works she goes i said yeah no no it's good i'm not i mean in the end it's like a complaint it's perfect yeah but it's it's

like you remember we've had this conversation about cars right today's cars you have all these electronic elements heating seats heating steering wheels all these high advanced electronic you open up the hood of your car i mean it's like you have no idea really what anything is. You're just like, oh. But you talked about when you used to have like an old Impala stuff that you open it up, and you could step in there, and all there was was just like the engine. It was like, so if there was something wrong, you could kind of be like, either take it to a mechanic or hell. I mean, you could kind of figure out yourself. It's like, okay, what's, oh, this looks like it's not working.

You kind of figure it out yourself. It's like, okay, this looks like it's not working. You can figure it out. Yeah, you kind of learned, right? Because you could just hear things and you could just tell. You could pull out a spark plug and say, yeah, this guy's shot. Let me change the spark plugs, get them going. Boom, car start up right away. You can clean your carburetor. There was just so much you could do because you could get to it in the first place, right? Now it's like you open it up and you're like, holy man, I don't know where anything is.

Yeah, where is everything? It's like, you know. So, yeah, it's a whole... It's just so different now. It's so different. But those are the things, like I said, it's just, it worries me because it's like something in the car doesn't work

and you can't drive it. It's like, yeah, but that shouldn't stop me from driving. There's nothing, you know, so what? So, you know, this little sensor's's nothing. So what? So this little sensor's not working. Who cares? I can still drive the car, you know? But that's not how it works. Well, and that's the funny part, because now it's like you're driving these old cars, and it's

like the sensor's going off. It's like, you know, until the car stops, I'm still going to be driving it, because I don't know what the sensor could do to be bad. So it's like, oh, there's something wrong with the car. As long as it's still driving and turning on, I'm fine. Well, I guess I went to a figure-style truck wrong with the car. Like, hey, you know what? As long as it's still driving and turning on, I'm fine. Well, I guess they like, I mean, I went to a figure-style truck, right? Yeah.

And it doesn't have any of those gadgets. It's an old truck. And they told me that, you know, it's leaking a little bit of water, right, from the water pump. I said, okay, you know, I got to get it fixed right away. They go, no, no, no. Next time you're in, you can get it fixed. Okay. So the car still drives, right?

In today's world, they'll probably sense it, eh, leak. Exactly. You're not going anywhere. Well, that's the worst part. The more advanced the car gets, it's like, oh, yeah, you need oil change. You get that engine light on, you know, and right away it's, oh, my God, what's going on? What's wrong? Yeah.

And it's, so it's. Now we got so many old cars now, we always see the engine light. If you turn it on, then there's no engine light. You're like, okay, what's wrong. Yeah. And it's, so it's, now we got some of the old cars and we always see the engine light. If you turn it on and there's no engine light, you're like, okay, what's wrong?

The engine light should be popping up to show you what's going on. That's true. That's so true. You also gave me a couple like

financial facts of the week. Yeah, so this guy, this is funny because this guy sends kind of little tidbits,

right, on a weekly basis and some of them sometimes catch my attention. Well, one of them actually, the first one actually But this guy, this is funny because this guy sends kind of little tidbits, right, on a weekly basis. And some of them sometimes catch my attention. Well, one of them actually, the first one actually isn't even a financial fact. No. Yeah, yeah. But it's just like it says an estimated 104 million Americans of working age spend more than seven hours a day in front of screens, according to the American Optometric Association.

So they'll be needing glasses sooner than anybody else. Is that the truth, though? Because I remember when I was little, I would watch. I would sit right in front of it. We used to have the old box TV. I'd sit right in front of it and be watching TV. And mom would be like, oh, don't sit in front because it's going to hurt your eyesight. But then again, it's like the cat and the mouse thing because we're the chicken and the egg. I don't know what reference I'm trying to make.

But the whole point was the reason why i was sitting in front was already i already couldn't see that's why i was like sam but i'm like i can't see anything yeah but you have you sit close you're gonna hurt your eyes but i'm like i can't see anything i used to have that problem because it wasn't until like maybe i was in second or third grade that they finally figured i need glasses because i kept going up and the teacher would be like why are you sitting there it's like i can't see she's so then she'd keep putting me in the front, and I'd be like this. And she's like, well, you know, I can't see. And then it's like, well, I think you need glasses.

And I was like, I need glasses. I was like, well, that's why I was sitting in front of the TV. It wasn't like I was putting my face to the screen on purpose, but I need the glasses. Well, yeah, I mean, listen, I'm not an optometrist, right? So I don't know the answer to this. But I've always heard that it's good to exercise your eyes by looking far away, right? And I guess the point is that if you're constantly looking at a screen, which is closed, then you're not exercising the muscle to have your eyes look

far away so it can hurt your vision, right? You know, it's one of those things where it's hard to tell. We'll tell, you know, we'll be able to tell, because let's be honest, I mean, your generation and the generation behind you, right? Was that Gen Z or something like that? Between phones, between laptops, between screens, everything is on screen, right? So it's like, will that have an impact on them in the future with their eyesight? Who knows? I mean, I don't know the answer. It feels like it's not the right thing to do.

But let's be honest. I'm sitting in the office all day, same thing. I mean, I'm in front of that computer all day. You have to trust everything is done electronically. Because everything is, yeah. Your banking is done electronically. Everything, yeah. Your investing is done electronically.

Your work is now electronically. People's school systems are on electronically. All the research that you get is all coming through the computer. Even when I was in school, was you know six seven years ago in college i mean half of my reading assignments was here's the pdf read it online it's like can you print it well yeah you can print it but it's you know 40 pages where are you going to print 40 pages i was like i gotta i have to read it online it's just like everything is online and And it's just – yeah, and I do sometimes wonder about the long-term consequences of that. Like we don't know because we've never worked – I mean your generation now is – you're getting older, right?

But they haven't worked on computer screens as long as my generation worked. No, definitely not. Maybe for the last 10 to 20 years, but certainly not like my generation will have. We'll be spending probably 40 to 50 years looking at computer screens. Exactly, yeah. Yeah, and I tell that to everybody. I mean, I remember literally Monday mornings

getting a stack of paper like this, right, where it was all the research from different companies, you know, Salim Brothers, Lehman Brothers, Bear Stearns, all these companies would send their research, right? You'd get it Monday morning on your desk, right? Open up and start reading, right? Yeah.

And then all of a sudden, boom, they cut it because we had emails. They send you in an email, you know, and of course, you always – I said, what am I going to do? I would start printing it, right? So now the burden was on your company to waste the paper, right? And then now it's just – like I said, it's just boom. You get it on your email, you hit that click and it goes into their website and you read it off their website. Sometimes it's even like, sometimes I want to print this so I can take it home and read it at home.

It's like, how do I print this thing? It doesn't even let me print it. And the worst part too is, and I don't blame you, but sometimes too you print it and then it's like, you're looking, it's like the print lays like this. You're like, I can't, I can't see anything. I can't read this,

yeah. I mean, like, what's the point? You know, it's already small on the computer screen, but I mean, you print it,

it feels like it shrinks even more. You're like, forget about it. I can't read this. You know, but yeah, I do sometimes worry about that. I mean,

we don't really know, so much, we're looking at so much electrons, and I think it's, I don't want to say it's bad for the eyes, but it certainly has an effect in the eyes where, I know you have this problem. There's just some weeks where it's just like you get home and you're not tired physically, but your eyes just.

Your eyes are tired, yeah. Your eyes are tired. And unfortunately, it makes you physically and even mentally tired because your eyes just feel like they can't stay open. There's just so much light going on them that it's like your eyes are just like, I'm done. And you're like, yeah, but it's 7 o'clock and you're sitting on the sofa and you're watching TV like this. So you bring a good point because that's why I like the summer so much, right? Because you come home and you're able to go outside, go outside,

do some things, and you're not really, you're not using your eyes, right? In other words, you're not straining your eyes, you just doing some work but in the winter you come home it's like it's already dark out you can't do anything but in your right it's just you sit there you try to read and it's like you know you're you're just you know you're struggling to to look at especially the older you get you know you you play the trombone bring it up and close and you get tired of it you know so you it. Then you're right. You start watching TV or whatever. It's a horse.

It is. I'm hoping maybe one day I can invent some sort of reading assistant where it's like they have it and it's like, I want to hear give me a summary of what this report said. Here's a summary. I'm like, okay. I got the research done for the day. I'm going to read two pages of it.

That's always good to dig deep. I know. Talk about digging deep. I think this is morning. I got this email or this notice. They're not emails. This notice from the American Association of

Individual Investors. American Association of Individual Investors. You should have put the print bigger. of individual investors, right? American Association of Individual Investors. You should have put the print bigger. Exactly, yeah. And it came out with a most recent survey that said 60% of these investors are bearish, right? And it's the highest number since September of 2022, and the time before that was Marching 2009.

So the first thing is like, holy cow, I mean, that's 60%, and that's supposed to be really high. It's like, that's an important number, right? In other words, people are bears. What does that mean, right? However, when I started to read the article, that's when I came in and said, you know, since, you know, I think it said September 2022. And I said, September 2022. Then I kept reading. And in March of 2009, I said, you know, since, you know, I think it said September 2022. And I said, September 2022. And then I kept reading. And in March of 2009, I said, wait a minute.

Because I said, those were like almost at the end of the bear market, right? So I went out to Bloomberg and it's like, yeah, these were the end of the bear market. So people were most bearish at the end of the bear market in 2022, when the market was already down 25%, and at the end of the bear market in 2009, right, from that 2008, 2009 real estate implosion there, where the market was down about 40%, right? So it's like, so wait a minute. So you're telling me that that's when people became bear at the bottom of the market. So am I supposed to think that since they're bearish, it's probably good? Because even though the market's not, I mean, it's up 1%, right? So what I'm saying is you read just the highlight of that article and you say, oh, man, 60% since, oh, I really need to start selling my stocks, right?

When there's no reason because when you keep reading, it's like this particular survey and number is somewhat, I don't want to say bogus. It's a real number, but it's not giving you good information. It's giving you information, right? But you shouldn't act on it because if you act on it back in 2022 and 2020 and 2009, you would have lost huge bull markets, right? So you sit there and that's what I tell people because people do that to me all the time. They'll call me, oh, I just read this. What do you think? And it's like, send me the article because obviously I haven't read that one and let me see because you can't read one article and say this is what's going on you have to first

read the whole thing do do the analysis say wait a minute yeah this is this is kind of bogus or yeah this is focusing on this area of the market or this is saying this but if the opposite happens and it could then you're on the other side of the fence, right? So it's always good to kind of read everything and take a step back and say, no, you know what, you've got to be careful. And the other thing that came out, which I thought was, I always get this, was the letter that Warren Buffett sends to his shareholders, right? And it's interesting because, and again, I didn't read the letter. I read an article on somebody that is a shareholder. He gets the letter and he was just talking about it. And what I thought was interesting though,

in what he mentioned was two things. One is, so right now he's in cash. He's, I think, about like 32 percent in cash. Right. And he started going to cash last year. So I think he bought a lot of Treasury bills because he felt very good about Treasury bills. Treasury bills because of the fact that the rates had gone up. Right. I guess he felt that a five, five and a half% return on his cash was good to have, right? And his, you know, Berkshire, I think, had a return slightly higher than the S&P 500 last year. In 2023, they struggled. He had a return that was almost half of the S&P 500. So, you know, he's got – but what I thought was interesting was he mentioned he always talks about dividends and reinvesting those dividends back into the company, right?

Of course, it's his company, right? So he's going to be trying to tell the shareholders, yeah, you've got to reinvest them back into the company, right? And over time, that has been the right move because over time, if markets go up 10%, 15%, instead of keeping that dividend in cash, you're reinvesting, and therefore, your portfolio is going to go on greater you know, 10%, 15%. Instead of keeping that dividend in cash, you're reinvesting, and therefore your portfolio is growing greater and greater, right? But this is the first time in many years he doesn't talk about that,

and he doesn't talk about literally buyback, right, of the stock, which, you know, I take a step back and say, so what does that mean? Does that mean that he's nervous about the markets going forward? And remember, he's very strong in buying companies more than just investing companies. Yes, he invests in Apple and video and things of that sort, but he's much more of a buyer of companies, right? So he's kind of a different investment when you buy, you know, Berkshire Hathaway. But my sense is So he's kind of a different investment when you buy Berkshire Hathaway. But my sense is like he's, one of the things he's saying, because little by little I'm stepping down, because I think he's, I know he's in his 90s, and I think he's 95, I'm not 100% sure.

But because, you know, he will be stepping, you know, down a little bit, is he saying that he doesn't have enough confidence in whoever is going to be running the company, which shouldn't be the right thing to say or do, right? Or is he really nervous about the market? So that's the only thing I took from that. Could it be that he's just waiting for an opportunity to kind of buy if there's a dip? Because I know there was some famous economist, I forgot his name, but he always said that I know when to buy the market when my neighbor is selling, and I know when to sell the market when my neighbor is buying.

Which is kind of what you talk about with the consumer sentiment. But sometimes the consumers are like, oh, the market's doing really bad. The market's already dipped. It's already been bad. Now it's going to come back up. They're like, oh my gosh, I'm so nervous. Versus the reality, same thing. When the market's been up, they're like, oh, the market's up 25%.

Maybe I should buy. It's like, well, you could have missed. That's the idea. I'm curious whether maybe his mentality is more of I'm waiting for the right moment to jump in because, like you said, maybe the dips already happened. I think he sold things like Citicorp. He sold, what's the other bank, Capital One. He held on to Bank of America, and I think that's more, to be honest, political than strategically, because Bank of America has done nothing in the last year or two, really.

And so I think part of it is you're right. I mean, the markets have been so strong that maybe he's taken a step back and say, I don't mind allowing my dividends, my own dividends, or allowing me taking some gains off the table and just for now keep it in cash. And if cash is paying me 4% to 5%, I'm happy with a 4% or 5% return on that portion. And then you're right, waiting for the right opportune time to say, that sector of the market is weaker or this area of the market is better. And listen, you look at just this year alone, right, you look at the sectors of the S&P 500, right, and the S&P, like I said, is up about 1%.

But consumer discretionary, the other data is down almost 4%. Technology is down about three-quarters of 1%. And the other sectors are all up. So like I said, even when you look at the markets as a whole, there are sometimes sectors that do well or not do well. And so that creates opportunities, right? Because like everything else, things don't go up forever and things don't go down forever. So you sit back and

you say, okay, this sector has been going down. I think it was down last quarter, it's down this quarter. So maybe the sense is the same concept, right? Sooner or later, that consumer is going to stop. So consumer discretionary is the area where if you think the consumer is going to stop spending, that's the sector that's going to get hit. So most, like everything else, sometimes the markets are ahead of their time and maybe they're looking at it and say, the consumer can't keep this up for another year, so I'm pulling some money out of that sector and putting it somewhere else. Technology has had an outrageous run for two years.

Can it contain this same kind of pace? Maybe not. So I'm going to put some money off the table. And so you look at that, and if it continues to drift, then again, then you have the opportunity to say, okay, I mean, it's down, and I'm making this number up, but, okay, it's down 15%. I think it's time to go back in, right? Because, yeah, I don't think

it merits being down that much. So, obviously, Warren Buffett and his team are very smart, so they probably have that ability to say, we've got so much invested everywhere, it's probably not a bad idea

to take something out of the market. Something to keep your mind on. That was interesting when you brought up that statistic, 60% are kind of bearish on the market. You wouldn't think that, but like you said, especially for a market that's

actually been technically up for the year. But it's been volatile, right? That's the thing. I think people are also wary, too. When you had like back-to-back really good years which i believe we've had yes 2023 2024 i think people just even though it doesn't make any rational sense people like well it's gonna go down right you know what i'm saying it's like well they have to have a bad it's like the sports team and i went back to that championship you kind of like well they have to have a bad year eventually, right? So you always like that. They can't win another championship.

Exactly, you know? Yeah. Well, it's almost like the Chiefs, like they can't win again. They almost did, but it's like they can't be good again. So I don't know about that. Yeah, you know, it's true. One never knows. But I think from the very beginning, you know, we mentioned so much is going on, right, because of this new administration.

And let's face it, yes, we had this administration, you know, before the last administration. So the markets were really good. They performed very well. Things went well, right, even with the tariffs that he put then, right. The COVID year was the year that the market just fell apart, obviously, because the economy stopped functioning, right, even with the tariffs that he put then, right? The COVID year was the year that the market just fell apart, obviously, because the economy stopped functioning, right? So he said they go up, you know, that's, you know, why should we expect anything different?

But the changes he's looking to make, right, are consequential, right? And the problem is, you know, those changes have consequences which maybe we're not 100% sure. So think about it. And I heard this on the radio this morning. So everybody's up in arms because there's so many – they want to cut so many government jobs. And it's like this is not fair. Maybe we've got to look at it in a different way. And whether they're doing it the right way or the wrong way is not the question.

The question is, do we truly have a bloated government? And if the answer is yes, we have a bloated government, in other words, there's a lot of people that we don't need to do those jobs, then it's my opinion. I mean, it's our tax dollars, right? So it's my opinion that, yeah, I mean, those people shouldn't be working. Just like in a company. If a company has two workers and one of them is doing a good job

and the other guy is not doing anything, well, that guy is going to get fired. I mean, it's just what it is. A company doesn't worry about anything other than its earnings, right? Yeah. And so that's what happens. Well, I heard this morning that MSN, I think it's MSNBC, which I think is owned by Comcast, is cutting MSNBC workers, right? Because they realize it's bloated.

In other words, their returns aren't compensating them for the amount of people they have. So if a company can do that, right, we should allow the government can do that. The issue is that if all these people get unemployed, then what happens? The unemployment rate goes up. These people are no longer paying taxes. I think all that and don't no longer have a job, all that has an impact on our

economy. What is that impact? How is it going to look like? I guess the question is how quickly you can build a private sector to hire those people that are losing their jobs. We know that the goal is can build a private sector to hire those people that are losing their jobs. And that's the key. The key is we know that the goal is to build a private sector, but can those people be replaced quickly enough into the private sector? And that's what we don't know.

Before it has an effect really on the economy. Exactly. So I think the markets are looking at things like that and saying, yeah, in the long run, this is good, right? Because you're wasting taxpayer dollars, right? But at the same time, if you let people go, those people are no longer part of the economy and it says, oh, they're not going to go out there and spend money. And I think the issue is people get worried about, you know, all this kind of drastic cutting in spending. But listen, like him or hate him, Elon was right about one thing, that it's like our debt, our interest payment on our debt is, I think what he said, it's higher than like our GDP, like he's like, it's, or will be, like it's almost unsustainable.

So the problem is you have to cut spending. One way or the other, you have to find a way to cut spending, you know. So the problem is this administration is doing it, some people say, with a meat cleaver. It's just like, I'm just chopping it off. People say, well, that's not the right way to do it. But the problem is, what's the right way to do it? Because you have to do it fast. We've put ourselves in a situation where we're kind of running

out of time. And if nobody else has any better ideas, it's like, well, that's what it is. It might hurt, but you cauterize the wound and you keep going. No, well, it's true. I mean, think about it. So, I mean, and I think this was about two years ago, the interest on our debt was about 7% of our expenses.

That's kind of doubled, right, since then. So it's 14% of our expenses, right, I mean government expenses. So if you went from 7% to 14, something has to be crowded out. In other words, there are services. So either you have to borrow more to pay for that interest payment, which only makes it worse, right? Or services have to go by the wayside. So the important thing is to figure out, oh, wait a minute,

we can't continue in this pace because if that 14 becomes 28, sooner or later you're going to be this, like, all we are doing is paying debt. We can no longer service, you know, whether it be defense spending, Medicare, Social Security, all that will be troublesome, right? So, yes, it's important to say we don't want to have to borrow more. So the first thing we have to do is balance the budget this year, and then, yes, we need to cut our debt because it still hurts, right? Again, it's the credit card thing. Okay, this year, okay, I'm not going to overspend, but you still have a debt out there that you're paying for.

Exactly. So sooner or later, you have to say, i have to find ways to cut my own expenses you know and begin to and begin to pay down the debt and so i think you're right this unfortunately it you got to the point where since nobody paid attention to this for for many many years right it's finally come to the point and i think i think heard Elon also say, which I think this is important, right? It's not just that, you know, he's also looking at some software that doesn't even work or is antiquated, right? And systems don't talk to each other. And you would think at this point in time, there should be systems that talk to each other.

In other words, if Social Security payments going out and this tax thing says this guy got this paid, they should talk to each other and say, wait a minute. Or the death record is like this guy died, but they never told the Social Security people. And whatever it may be, right? So I think it's important to get those systems up to date, make sure technology is working for our government, make sure it's efficient. And then, yeah, I mean, we just, we just can't continue to spend that kind of money that we've had in the past without, you know, cause people always say raise taxes. Well, and I tell people, listen, if, if everybody paid a hundred percent of their salary to taxes, you still wouldn't make a dent on the, on the debt. So, you know,

the idea of raising taxes doesn't, doesn't solve the problem, right? You have to really begin to say we we have to cut our expenses, right? So that's, I think that's what they're doing. And, you know, I know it's, it can be ugly and I'm sure, again, I'm sure the markets are looking at it and say, we don't know what's going to happen here. And I'm sure there's going to be, you know, like everything else, you do something and then it's like, hey, wait a minute, these people that's really supposed to get their money didn't get their money.

Okay, what happened there? Okay, let's fix it. That's going to happen because this government is huge. I mean, so the amount of money they sent everywhere is enormous. So will there be a fallout where this person really, or that system really needed those funds and they didn't get it? Yes, that's going to happen.

But as long as it can be fixed and say, okay, yes, now we know, yeah, they're supposed to get it, go ahead and get it out, right? But these other 10 people or these other 10 areas, like, you know, there's no reason why they should be getting all this money, right? Yeah. And I had, you know, it's, listen,

I say this all this money, right? And I had, you know, listen, I say this all the time. I think focusing as a person, you focus on your family first and then your neighbors and then your community and then your state, right? And I think, you know, it's time that the U.S. starts thinking a little bit. We have a lot of work to be done in this country, you know, both on fixing things and people. There's still a lot of homeless people. We need to help those people.

We need to fix that. And I think if we can save some money and help those people, it would be great. We'll see. Interesting times. At least you'll have something to talk about. Every time you come on the show. There's news every week.

Every week you get to come on. Well, it's true. Listen, it is. We live in a, you know, our job is such that it's always the flow of information that's important and trying to make decisions based on that.

And it's not that, you know, let's face it, it's not that we go changing our portfolios on a daily basis because what we read, right, we structure portfolios based on expectations. But every once in a while, you know, that we tactically, we make movements because we see an opportunity, right? And, you know, this kind of information, what is happening over the last month has created tremendous opportunities, which some we've taken advantage of, and some we haven't, of course, because we can't do everything.

But it makes part of our job fun because you see an opportunity, you go after it, you make some money for your clients, and you feel good, right? And that's what it's all about. Yeah. All right, well,

thank you for being on the show today, Paul. Oh, you're welcome. Thanks for inviting me. Thanks for sharing your knowledge. Oh, it's always fun. No, I know it's good to everyone, so I'll talk about finance. There's been so much happening that it's like we weren't able to do the show last week because of the snow.

So it's been kind of like two, three weeks maybe. We really need to get back on track on that. We have somebody coming in next week. Next week we will have a guest. Unfortunately, like a little fool, I forgot to write it down. We will have a guest, but now you get to have a surprise. It will be announced on

Facebook at some point during the next week. We were supposed to have a guest last week. Unfortunately, they couldn't reschedule today, so hopefully we'll have them back. Which is part of the reason we canceled because that person couldn't come in. We were hoping they'd come in this week, but they couldn't make it either. But that's okay. We'll have them back. But we will have a guest next week.

I think your part will be on. Yes, I understand that there's some Spanish to be spoken. I believe so, yes. You need to work on your little Spanish. I guess so, yeah. You haven't spoken in a while. But as always, we are happy to be presented by Emergent Financial Services, sponsored by Matisse & Realty, Credit Series Insurance, Charlottesville Opera.

As always, a big thank you to Pops for sharing his wisdom. Well, thank you. The little gray hairs don't lie. The little gray hairs don't lie. A big thank you to Judah for always being behind the camera, making us look good. The little gray hairs don't lie. The little gray hairs don't lie. Big thank you to Judah for always being behind the camera, making us look good. Thank you to iLoveCivil Studios for having us.

We look forward to seeing you next time, but until then, hasta mañana. Gracias por ver el video.