WEBVTT 1 00:00:00.160 --> 00:00:02.480 If anything Trump does, I think he knows is doing 2 00:00:02.720 --> 00:00:03.839 every day what we. 3 00:00:03.799 --> 00:00:07.919 Have to you know, fifty five KRC the Talk station. 4 00:00:12.679 --> 00:00:15.919 He five the fifty five KRC the Talk Station. 5 00:00:15.679 --> 00:00:16.280 Are very happy. 6 00:00:16.559 --> 00:00:19.120 Monday's always made extra special happy. We get to hear 7 00:00:19.120 --> 00:00:22.839 from Brian James Moor Financial on money matters. Brian James, 8 00:00:22.879 --> 00:00:24.280 hope you had a wonderful week and welcome back to 9 00:00:24.320 --> 00:00:25.600 the fifty five KRC Morning Show. 10 00:00:26.320 --> 00:00:28.000 Thank you and good morning to you as well. 11 00:00:28.359 --> 00:00:30.719 Not a lot of good news in the rundown of 12 00:00:30.760 --> 00:00:34.119 topics here, so let's talk about consumer sentiment. I know 13 00:00:34.200 --> 00:00:36.439 there's a couple of polls out Michigan University of Michigan 14 00:00:36.439 --> 00:00:39.799 poll and a CNN poll people not feeling real good 15 00:00:39.880 --> 00:00:42.920 about the economy at least in so far as concerns 16 00:00:42.920 --> 00:00:48.200 about inflation are concerned. Are they are are the those 17 00:00:48.359 --> 00:00:51.359 polled who are having these concerns and the sentiment dropping 18 00:00:51.399 --> 00:00:53.200 off accurate? 19 00:00:55.079 --> 00:00:57.399 Well, but any poll is only as accurate as the 20 00:00:57.439 --> 00:00:59.799 audience that they're talking to. Now, these do come from 21 00:00:59.840 --> 00:01:02.439 the University of Michigan, which is that that's who we're 22 00:01:02.439 --> 00:01:05.640 always talking about, right whenever you hear the words consumer sentiment. Yes, 23 00:01:05.640 --> 00:01:08.760 there are plenty of organizations, but the University of Michigan 24 00:01:08.879 --> 00:01:11.239 is the whopper that has been around for the longest time. 25 00:01:11.280 --> 00:01:12.920 So if you're going to trust any poll, it's the 26 00:01:12.920 --> 00:01:15.560 one with the largest reach in the most history. So 27 00:01:16.000 --> 00:01:19.280 University of Michigan latest survey is showing a significant decline 28 00:01:19.319 --> 00:01:23.680 in sentiment in February, dropping by about ten percent from January. 29 00:01:23.719 --> 00:01:26.239 This is not shocking if you've paid any attention at 30 00:01:26.280 --> 00:01:28.280 all to the headlines. I think there were plenty of 31 00:01:28.319 --> 00:01:30.000 people out there who thought all we had to do 32 00:01:30.159 --> 00:01:34.200 was was elect a really conservative administration and everything would 33 00:01:34.200 --> 00:01:36.760 get fixed with the push of a button, because it's 34 00:01:36.799 --> 00:01:39.560 just that simple. Well, we know that's not the case. Obviously. 35 00:01:40.040 --> 00:01:42.719 Egg prices are the thing that everybody's sick of hearing about. 36 00:01:43.280 --> 00:01:46.040 Tariffs are never ever ever going to be an immediate 37 00:01:46.120 --> 00:01:49.400 good thing. They are shot across the bow to start 38 00:01:49.439 --> 00:01:51.159 a little bit of a trade war and settle things 39 00:01:51.159 --> 00:01:53.799 out at a different point. But in the very short run, 40 00:01:54.000 --> 00:01:58.079 we're always going to have a negative downturn as business 41 00:01:58.120 --> 00:02:00.640 sorts itself out and countries figure how they're going to 42 00:02:00.719 --> 00:02:03.959 work together again with regard to these trade agreements. We've 43 00:02:03.959 --> 00:02:07.200 seen it before, though, so nothing to panic about yet. However, yes, 44 00:02:07.280 --> 00:02:09.560 obviously a lot of grumpy people out there at the moment. 45 00:02:09.759 --> 00:02:12.960 Well, and I found it a little ridiculous that Trump 46 00:02:13.039 --> 00:02:15.719 actually set on the campaign trail. Here at trail he 47 00:02:15.759 --> 00:02:18.759 promised to bring down prices starting day one. I think 48 00:02:18.759 --> 00:02:20.800 I may even comment about that on the air. How 49 00:02:21.439 --> 00:02:25.960 I mean this is inflation is very complicated and complex. 50 00:02:26.000 --> 00:02:28.039 You talk about egg prices, well, there's something called the 51 00:02:28.080 --> 00:02:31.199 bird flu out there. They're killing millions and millions and 52 00:02:31.240 --> 00:02:34.159 millions of chicken, obviously reducing the availability of the price 53 00:02:34.159 --> 00:02:37.759 of eggs. So there's one legitimate connection that has nothing 54 00:02:37.759 --> 00:02:41.439 to do whatsoever with any administration's policies. So you can't 55 00:02:41.479 --> 00:02:44.039 magically make bird flu go away or magically increase the 56 00:02:44.120 --> 00:02:47.800 number of laying chickens in the world. So we're gonna 57 00:02:47.840 --> 00:02:49.280 have to struggle with that problem for a while un 58 00:02:49.280 --> 00:02:51.360 till it gets you worked out. However it gets worked out. 59 00:02:51.759 --> 00:02:54.439 But insofar as tariffs are concerned, and you and I 60 00:02:54.520 --> 00:02:56.360 kind of share the same point on that, if you 61 00:02:56.680 --> 00:02:59.919 increase tariffs, the prices are going to necessarily increase by 62 00:03:00.240 --> 00:03:03.560 some percentage, maybe not a full twenty five percent, but 63 00:03:03.599 --> 00:03:06.280 that's going to get passed along to the consumer. Has 64 00:03:06.520 --> 00:03:09.759 that happened yet, I mean, we're feeling yet the impact 65 00:03:09.879 --> 00:03:13.560 of tariffs, because my understanding is it hasn't really settled 66 00:03:13.599 --> 00:03:14.039 in yet. 67 00:03:14.759 --> 00:03:18.080 Yeah, we're starting to see increases on prices on things 68 00:03:18.199 --> 00:03:20.800 laid on things that come out of China, for example, iPhones, 69 00:03:20.840 --> 00:03:24.400 MacBooks are starting to increase prices a little bit, the 70 00:03:24.439 --> 00:03:26.800 fast fashion types of things. These are names wh wouldn't 71 00:03:26.800 --> 00:03:29.800 have heard of ten years ago, Shine and Timu, and 72 00:03:29.840 --> 00:03:32.479 I think I'm pronouncing one of those incorrectly. But these 73 00:03:32.520 --> 00:03:35.800 are places where where people have used a lot in 74 00:03:36.319 --> 00:03:40.280 recent history to get really cheap clothing and things like that. 75 00:03:39.960 --> 00:03:42.439 That's that's kind of ground zero for what we're really after. 76 00:03:42.800 --> 00:03:44.800 There are rules not not only the tariffs, but there 77 00:03:44.840 --> 00:03:48.960 are rules that were in place called the deminimous Exemptions 78 00:03:48.960 --> 00:03:54.319 that that basically allowed China to create extremely cheap items 79 00:03:54.360 --> 00:03:56.639 of apparel and things like that and ship them over here. 80 00:03:56.680 --> 00:04:00.319 Shipping is the big part, but the policy that were 81 00:04:00.319 --> 00:04:03.319 in place prior to this allowed them to do that 82 00:04:03.479 --> 00:04:06.000 very easily and very cheaply. Those rules have changed too. 83 00:04:06.039 --> 00:04:08.319 That's not a tar iff, that's simply the removal of 84 00:04:08.360 --> 00:04:11.039 a discount effectively, So things like that are going to 85 00:04:11.080 --> 00:04:14.400 get more expensive. We're also seeing produce fruits and vegetables 86 00:04:14.439 --> 00:04:17.839 from Mexico, avocados, tomatoes, strawberries, bell pepper, stuff like that. 87 00:04:18.000 --> 00:04:20.879 If you've been paying attention have seen noticeable price increases, 88 00:04:21.079 --> 00:04:23.800 they're not yet. Remember these are things that per unit 89 00:04:23.839 --> 00:04:26.399 don't cost that much to begin with. So unless you're 90 00:04:26.399 --> 00:04:28.560 truly paying attention, and you're one of those people with 91 00:04:28.600 --> 00:04:30.399 a spreadsheet and I've seen them in the grocery store 92 00:04:30.480 --> 00:04:34.040 lately tracking prices over time, you may not notice this, 93 00:04:34.160 --> 00:04:36.360 but you know something that costs fifty cents now that 94 00:04:36.480 --> 00:04:39.399 now costs fifty five cents, that's a nickel, But if 95 00:04:39.399 --> 00:04:41.720 you do the math, that's a ten percent increase. So 96 00:04:41.879 --> 00:04:43.759 these things were just at the beginning of this. They're 97 00:04:43.800 --> 00:04:45.920 going to sneak in. The price increases are going to 98 00:04:45.959 --> 00:04:49.199 sneak in kind of without us noticing unless you're paying 99 00:04:49.199 --> 00:04:49.800 close attention. 100 00:04:49.959 --> 00:04:51.360 Well, I know one of the things that was mentioned 101 00:04:51.399 --> 00:04:53.439 in the article fed share at Jerome Pala said last 102 00:04:53.519 --> 00:04:56.439 year to keynote address, you know, it was an inflation 103 00:04:56.560 --> 00:04:58.560 brought about by a number of factors. Again, all these 104 00:04:58.600 --> 00:05:02.600 different factors over which brand new administration can't really control 105 00:05:02.639 --> 00:05:06.240 but pent up demand, stimulative policies, pandemic changes in work 106 00:05:06.240 --> 00:05:10.759 and leisure policies, and the additional savings associated with constrained services. 107 00:05:10.839 --> 00:05:13.639 In other words, people weren't out spending the money. Finally, 108 00:05:13.639 --> 00:05:16.399 when the economy got opened back up again, it was 109 00:05:16.399 --> 00:05:19.279 a spending free for all, which contributed to a historic 110 00:05:19.319 --> 00:05:23.360 surgeon consumer spending on goods. If the demand goes down 111 00:05:23.560 --> 00:05:25.639 because people are feeling the heat of you know, the 112 00:05:25.720 --> 00:05:27.839 real estate tax is going up, or maybe some of 113 00:05:27.839 --> 00:05:30.879 the increase in pricing. Obviously, grocery store prices continue to 114 00:05:30.920 --> 00:05:33.560 go up. If demand goes down, then that might have 115 00:05:33.600 --> 00:05:37.240 an impact on lowering prices because the supply will increase. 116 00:05:38.160 --> 00:05:41.160 Correct, that's all part of the correction. But demand going 117 00:05:41.199 --> 00:05:43.319 down is usually going to result in some pain time, 118 00:05:43.360 --> 00:05:46.360 I know, because if demand goes down for a product 119 00:05:46.360 --> 00:05:48.959 that your company creates, guess who's in for a round 120 00:05:49.000 --> 00:05:52.000 of belt tightening. So that's all part of the process 121 00:05:52.040 --> 00:05:55.040 here of if we want to change the point at 122 00:05:55.079 --> 00:05:57.720 which we meet in the market, meaning what do we 123 00:05:57.759 --> 00:06:00.000 pay other countries for the goods and services that were 124 00:06:00.079 --> 00:06:01.959 buying for them? What do they pay us for ours. 125 00:06:02.160 --> 00:06:04.360 We want to change the point where we are on 126 00:06:04.399 --> 00:06:06.439 the playing field for that, but that's not going to 127 00:06:06.480 --> 00:06:08.920 happen without some pain and without some adjustment, and that 128 00:06:09.079 --> 00:06:11.360 you're seeing an awful lot of that, you know, just 129 00:06:11.399 --> 00:06:13.839 in the federal government with the cuts that like them 130 00:06:13.920 --> 00:06:17.079 or not, the cuts that are coming from the Doge Office, 131 00:06:17.279 --> 00:06:20.000 whether it's real or not, these things are actually happening, 132 00:06:20.680 --> 00:06:22.399 and that is the same thing. We just want to 133 00:06:22.480 --> 00:06:24.560 change how the money moves around. We want to change 134 00:06:24.560 --> 00:06:27.720 how business is done, good, bad and different. There can 135 00:06:27.759 --> 00:06:29.319 be good things that come out of that, there can 136 00:06:29.360 --> 00:06:31.240 be bad things, but no matter what, there's going to 137 00:06:31.319 --> 00:06:33.000 be disruption and it's going to be a bit of 138 00:06:33.000 --> 00:06:34.920 a bumpy ride. And we're already seeing that these last 139 00:06:34.920 --> 00:06:35.480 several weeks. 140 00:06:35.519 --> 00:06:37.560 Well, sort of a correlador to this discussion, I saw 141 00:06:37.560 --> 00:06:40.000 this article headlines in the front page at the Wall 142 00:06:40.040 --> 00:06:42.439 Street Journal, the US economy depends more than ever on 143 00:06:42.560 --> 00:06:46.079 rich people. The highest earning ten percent of Americans account 144 00:06:46.120 --> 00:06:50.000 for almost fifty percent of all consumer spending, and as 145 00:06:50.000 --> 00:06:53.000 the article points out, the number of lower income earners 146 00:06:53.040 --> 00:06:56.079 spending is dropping, but the rich people keep going out 147 00:06:56.079 --> 00:06:58.360 and spending heaploads of cash and all kinds of things, 148 00:06:58.360 --> 00:07:01.160 including travel and you know, stuff that's out of the 149 00:07:01.160 --> 00:07:02.759 reach of a lot of Americans. 150 00:07:03.279 --> 00:07:06.000 Yeah, and that's what masks a lot of you know, 151 00:07:06.240 --> 00:07:09.399 the real life situation here in the United States, because 152 00:07:10.120 --> 00:07:13.160 those ten percent can really keep the economy cooking as 153 00:07:13.199 --> 00:07:16.240 they have for the last several years. But you also 154 00:07:16.279 --> 00:07:18.279 have a lot of people suffering out there, but that's 155 00:07:18.360 --> 00:07:20.680 hidden by the fact that we have a strong economy, 156 00:07:20.680 --> 00:07:23.279 economy keeps growing. The stock market the last couple of 157 00:07:23.360 --> 00:07:26.160 years has been strong. We tend to forget about twenty 158 00:07:26.199 --> 00:07:28.040 twenty two was a terrible year in the stock market, 159 00:07:28.120 --> 00:07:30.800 but it doesn't come with a story attached, really, so 160 00:07:30.839 --> 00:07:32.759 we don't really think about that. Nobody talks about it 161 00:07:32.800 --> 00:07:35.480 like we do two thousand and eight. However, there's a 162 00:07:35.480 --> 00:07:37.839 lot of people suffering out there, but that gets completely 163 00:07:37.920 --> 00:07:41.199 hidden by all the economic activity that that largest or 164 00:07:41.319 --> 00:07:44.480 richest ten percent is producing. And unfortunately, that's become the 165 00:07:44.519 --> 00:07:47.040 American way over the last century or so. That's not 166 00:07:47.160 --> 00:07:49.680 a new phenomenon. It's just getting the two groups are 167 00:07:49.720 --> 00:07:51.720 just getting further and further apart. 168 00:07:51.879 --> 00:07:54.240 All right, and pivoting over to something connected in some 169 00:07:54.480 --> 00:07:58.000 level market correction I keep hearing about we're going to 170 00:07:58.120 --> 00:08:01.040 we'd for a market correction good way. In other words, 171 00:08:01.120 --> 00:08:03.360 the market is overpriced and people are expecting it to 172 00:08:04.040 --> 00:08:07.439 drop off and valuations of stocks to drop off. And 173 00:08:07.480 --> 00:08:10.160 the question is, as some are have observed, are the 174 00:08:10.240 --> 00:08:13.720 Doge cuts bad for the economy? And will it empower? 175 00:08:13.759 --> 00:08:15.680 Will it cause perhaps a market correction? 176 00:08:16.920 --> 00:08:19.240 Good? Very well? So this This latest talking head is 177 00:08:19.279 --> 00:08:22.759 Steve Cohen. He's the CEO Ofer point seventy two Asset Management, 178 00:08:23.399 --> 00:08:25.680 and he says he is now bearished on the US 179 00:08:25.759 --> 00:08:28.360 economy for the first time in a while. He manages 180 00:08:28.519 --> 00:08:30.879 a hedge fund. He's a billionaire hedge fund type of 181 00:08:30.920 --> 00:08:33.080 a guy, obviously a very smart person who have gotten 182 00:08:33.080 --> 00:08:35.960 to this point. Certainly his opinion is worth something. But 183 00:08:36.000 --> 00:08:39.639 at the same time, you can go back through time, 184 00:08:39.679 --> 00:08:41.679 and I encourage people to do this when you start 185 00:08:41.679 --> 00:08:45.080 to feel attracted to this one talking head on some 186 00:08:45.200 --> 00:08:48.279 TV show says, here's what I think that is valuable. However, 187 00:08:48.360 --> 00:08:50.600 go back in time and go see what people said 188 00:08:50.639 --> 00:08:53.679 about early twenty two or early twenty three or twenty four. 189 00:08:53.840 --> 00:08:56.559 There is always at least one talking head out there 190 00:08:56.559 --> 00:08:59.519 who is not necessarily a stupid person. But there's always 191 00:08:59.519 --> 00:09:03.279 one talking head out there that is predicting a huge pullback. 192 00:09:03.519 --> 00:09:05.840 We never ever ever go back and see whether these 193 00:09:05.879 --> 00:09:08.320 people will write or not. So maybe Brian Thomas, you 194 00:09:08.399 --> 00:09:11.720 and I should mark our calendars or February whatever it is, 195 00:09:11.759 --> 00:09:14.320 twenty fourth of twenty six and see if mister Cohen 196 00:09:14.399 --> 00:09:14.879 was corrected. 197 00:09:15.120 --> 00:09:17.000 Yeah, let's hope he's not correct because a lot of 198 00:09:17.000 --> 00:09:18.399 people have a lot of money in four oh and 199 00:09:18.440 --> 00:09:20.639 ks and they're counting on that for the retirement. We 200 00:09:20.679 --> 00:09:22.600 don't want to see the market go in the toilet again. 201 00:09:22.720 --> 00:09:25.200 Does take a little bit while to get that money back, 202 00:09:25.519 --> 00:09:27.720 although the market has rebounded enough that most people have 203 00:09:27.799 --> 00:09:31.159 made up that money that we lost in twenty twenty two. Anyhow, 204 00:09:31.279 --> 00:09:33.759 Brian James, all with financials pause. We'll find out about 205 00:09:33.759 --> 00:09:37.960 home sales dropping in January and more Americans taking loans 206 00:09:38.000 --> 00:09:41.799 to pay for emergencies, but at what costs. Cash poor 207 00:09:41.840 --> 00:09:44.320 Americans are real problem eight fifteen fifty five kc DE 208 00:09:44.399 --> 00:09:45.440 Talk station, Don't go away, be. 209 00:09:45.519 --> 00:09:48.440 Right back fifty five KRC. If you're a. 210 00:09:48.399 --> 00:09:50.720 Claarmont County VET and a very happy Monday to you, 211 00:09:52.080 --> 00:09:54.679 try to find some happiness in these sad stories we're 212 00:09:54.720 --> 00:09:58.320 talking about with money Mondays Brian James, and in real estate, 213 00:09:58.399 --> 00:10:02.279 home sales have dropped January because prices are really high 214 00:10:02.279 --> 00:10:05.240 and people's perception of the interest rates for mortgages really high, 215 00:10:05.279 --> 00:10:07.440 in the combination of the two just really puts people 216 00:10:07.440 --> 00:10:09.960 out of the out of the market. I saw the 217 00:10:10.000 --> 00:10:12.480 medium price of a home in January three hundred and 218 00:10:12.600 --> 00:10:16.039 ninety six thousand, nine hundred dollars. That's up four percent 219 00:10:16.120 --> 00:10:18.639 or four point eight percent from the year before and 220 00:10:18.720 --> 00:10:21.559 the highest price ever for the month of January. That's 221 00:10:21.600 --> 00:10:24.480 a lot of money for medium price Brian James. 222 00:10:24.960 --> 00:10:28.960 That really is and then we may maybe maybe seeing 223 00:10:29.000 --> 00:10:31.240 a peak in all this. So sales are previously owned 224 00:10:31.240 --> 00:10:34.600 homes fell by almost five percent in January compared to December. 225 00:10:35.279 --> 00:10:37.639 One point one eight million homes for sale at the 226 00:10:37.720 --> 00:10:40.240 end of January. That was an increase of three and 227 00:10:40.240 --> 00:10:43.399 a half percent and up seventeen percent from January twenty 228 00:10:43.399 --> 00:10:46.840 four So interestingly, we are seeing more homes than the 229 00:10:47.279 --> 00:10:51.320 number of homes hitting the sale block has increased percentage wise, 230 00:10:51.360 --> 00:10:53.759 but the actual closed sales are starting to drop, So 231 00:10:53.799 --> 00:10:57.399 that's a sign of a peak here. And as you 232 00:10:57.440 --> 00:10:59.480 mentioned that the medium price of a home three hundred 233 00:10:59.519 --> 00:11:02.200 ninety six thousand dollars. That's up five percent itself. That's 234 00:11:02.240 --> 00:11:05.039 the highest we've ever had on that particular measure. In 235 00:11:05.080 --> 00:11:07.519 Cincinnati is not exempted from this anymore like we used 236 00:11:07.559 --> 00:11:09.840 to be. The secret is out that this is a 237 00:11:09.919 --> 00:11:12.600 wonderful place to live, and at least up until now, 238 00:11:13.000 --> 00:11:15.440 has been very reasonably priced with regard to real estate. 239 00:11:15.519 --> 00:11:20.080 Still is, of course regarding the compared to the richest 240 00:11:20.120 --> 00:11:22.240 places out there in New York City, San Francisco, and 241 00:11:22.320 --> 00:11:24.279 so forth. But at the same time, we are not 242 00:11:24.440 --> 00:11:27.679 the bargain that we used to be, so we're look, 243 00:11:27.919 --> 00:11:29.840 this isn't too much of a surprise. The analyst. We're 244 00:11:29.879 --> 00:11:33.240 expecting about a two point six percent decline in sales. However, 245 00:11:33.480 --> 00:11:36.960 the actual decline was about five percent, So these you know, 246 00:11:37.200 --> 00:11:39.200 we might be getting to that point where we're going 247 00:11:39.279 --> 00:11:40.960 to start to see a correction, bit of correction on 248 00:11:41.039 --> 00:11:41.799 the housing market. 249 00:11:42.279 --> 00:11:45.279 Well, I guess if you want to sell your home 250 00:11:45.480 --> 00:11:47.600 and it sits out there for a long time and 251 00:11:47.679 --> 00:11:50.600 people aren't coming to see it, maybe you've overpriced the 252 00:11:50.639 --> 00:11:54.120 home and asking too much, which obviously, if you're going 253 00:11:54.159 --> 00:11:55.519 to sell the house, you're going to have to lower 254 00:11:55.519 --> 00:11:57.279 the price to a point where someone's going to even 255 00:11:57.279 --> 00:11:59.080 show up to take a look at it, which apparently 256 00:11:59.080 --> 00:12:02.200 they're not right now. Well, so yeah, there's a market 257 00:12:02.200 --> 00:12:05.360 correction that might benefit everybody, just lower expectations on the 258 00:12:05.440 --> 00:12:06.279 value of your home. 259 00:12:07.039 --> 00:12:08.519 Yeah, and that's where it starts. I mean that there 260 00:12:08.519 --> 00:12:11.519 are house is always worth something. Houses are never absolutely 261 00:12:11.559 --> 00:12:14.200 completely worthless and let it unless it's you know, completely 262 00:12:14.240 --> 00:12:17.000 run down and about to fall apart. It's always the 263 00:12:17.039 --> 00:12:20.039 price that's the issue. So if the if the buying 264 00:12:20.120 --> 00:12:22.600 market has shied away from the neighborhood you happen to 265 00:12:22.600 --> 00:12:24.759 be in, well you can correct that by lowering the price. 266 00:12:24.840 --> 00:12:27.000 It's not wonderful, but it doesn't mean you cannot sell 267 00:12:27.039 --> 00:12:30.000 your house at the same time. So there's also an 268 00:12:30.080 --> 00:12:33.799 issue right now with there there are arguably fewer buyers 269 00:12:33.879 --> 00:12:35.960 out there than there would be in a normal market, 270 00:12:36.159 --> 00:12:39.000 because there are people out there who want to change 271 00:12:39.000 --> 00:12:41.960 their neighborhood or downsize, or they want to sell their 272 00:12:42.000 --> 00:12:44.519 home for some reason, but they're currently sitting on a 273 00:12:44.519 --> 00:12:47.200 mortgage it's less than four percent. Well, those folks are 274 00:12:47.200 --> 00:12:48.759 going to say, you know what, we're not really in 275 00:12:48.799 --> 00:12:51.919 a hurry that the problems we've identified here are not immediate. 276 00:12:52.159 --> 00:12:54.519 Let's wait until it's better and enjoy our four percent 277 00:12:54.559 --> 00:12:57.200 mortgage a little more. So That means sellers are really 278 00:12:57.240 --> 00:12:59.679 only dealing with people who are forced to move because 279 00:12:59.679 --> 00:13:01.879 of a or maybe they have to have a bigger 280 00:13:01.879 --> 00:13:04.080 house or something like that. That just means there are 281 00:13:04.159 --> 00:13:06.720 fewer buyers out there now because the ones who have 282 00:13:06.799 --> 00:13:10.360 flexibility are exercising that flexibility and going to hold off 283 00:13:10.399 --> 00:13:10.799 a little bit. 284 00:13:10.919 --> 00:13:14.399 And we've had conversations before about you know, paying off 285 00:13:14.519 --> 00:13:17.240 your home and actually owning it. And I know that's 286 00:13:17.279 --> 00:13:19.240 not always within the reach of a lot of people, 287 00:13:19.279 --> 00:13:21.200 but my wife and I you know, did a little 288 00:13:21.200 --> 00:13:23.440 belt tightening over the years when we had that lower, 289 00:13:23.600 --> 00:13:26.720 just just slightly under three percent mortgage because we refinanced 290 00:13:26.720 --> 00:13:28.879 to a much lower level. That's the right thing to do, 291 00:13:29.480 --> 00:13:32.679 but we use the extra money to make extra payments 292 00:13:32.759 --> 00:13:34.919 every month and ended up being able to buy the 293 00:13:34.919 --> 00:13:37.519 home a lot earlier. Now, is that, from a financial 294 00:13:38.559 --> 00:13:41.440 planning standpoint, a good thing to do when it is 295 00:13:41.519 --> 00:13:44.080 that low or where we have been better served had 296 00:13:44.080 --> 00:13:46.399 we taken that extra revenue and maybe put it into 297 00:13:46.399 --> 00:13:47.320 the market or something. 298 00:13:48.320 --> 00:13:50.799 Great. Question comes up all the time here at this table, 299 00:13:50.840 --> 00:13:54.799 and I'm sure it's a quiz it important question. So yeah, 300 00:13:54.840 --> 00:13:57.200 I can show I can show you in a spreadsheet, Brian, 301 00:13:57.559 --> 00:14:00.240 that the best thing we should all do is borrow 302 00:14:00.320 --> 00:14:02.799 money against everything and always invested, and by the time 303 00:14:02.840 --> 00:14:04.639 we're one hundred years old, we have a gigantic pile 304 00:14:04.679 --> 00:14:07.720 of money. That's the mathematical answer, but it's obviously not 305 00:14:07.840 --> 00:14:11.799 the human answer. So when you have this situation, yeah, 306 00:14:12.960 --> 00:14:15.039 it always makes sense to invest as much as you can. 307 00:14:15.080 --> 00:14:17.679 What I would encourage people to do is truly learn 308 00:14:17.759 --> 00:14:21.519 how an amortized mortgage works. And that simply means go 309 00:14:21.600 --> 00:14:25.039 look at understand the relationship between your payment and the 310 00:14:25.080 --> 00:14:28.159 interest rate and how much goes to principle early in 311 00:14:28.240 --> 00:14:31.159 the mortgage versus how much goes late. If you're ten 312 00:14:31.240 --> 00:14:34.000 years into a fifteen year mortgage, you are paying very 313 00:14:34.120 --> 00:14:36.279 very very very very little no matter what the interest 314 00:14:36.320 --> 00:14:38.759 rate is. You are paying very little interest because you're 315 00:14:38.799 --> 00:14:43.440 mostly paying principle, because you pay the interest and amortization exactly. Yes, 316 00:14:43.480 --> 00:14:45.840 you paid it up front. Your first payment was ninety 317 00:14:45.879 --> 00:14:48.360 nine percent interest. Your last payment is going to be 318 00:14:48.440 --> 00:14:51.440 ninety nine percent principle. Everything else is somewhere in between. 319 00:14:51.720 --> 00:14:54.159 So I am a big believer, and of course come 320 00:14:54.240 --> 00:14:56.120 up with a financial plan, and first of all, see 321 00:14:56.120 --> 00:14:58.360 what you need to do, and then once you've got 322 00:14:58.360 --> 00:15:01.559 the basics covered, make these decisions based off of what 323 00:15:01.679 --> 00:15:04.360 will make you feel most confident. If you feel like 324 00:15:04.480 --> 00:15:06.840 my nest egg is a little low, I need more money, 325 00:15:07.000 --> 00:15:10.039 that's fine, and your interest, your mortgage rate is reasonable, 326 00:15:10.240 --> 00:15:12.399 then focus on the four one k. Put those extra 327 00:15:12.440 --> 00:15:14.480 dollars a four one k and grown. Or if you 328 00:15:14.519 --> 00:15:16.279 feel the opposite, you know what, I think, We're okay, 329 00:15:16.279 --> 00:15:17.799 we got a good pile of money. I really want 330 00:15:17.840 --> 00:15:20.360 to get this mortgage monkey off my back. That's fine, 331 00:15:20.440 --> 00:15:23.000 pay it down more quickly. That's an emotional decision, not 332 00:15:23.039 --> 00:15:24.600 so much a mathematical one, right. 333 00:15:24.480 --> 00:15:27.200 And you know, I really really understood that when we 334 00:15:27.240 --> 00:15:30.240 did it. But we were able to do the extra 335 00:15:30.279 --> 00:15:33.279 payments because we were in a comfortable position. And I 336 00:15:33.279 --> 00:15:35.879 got to think about being in debt, Brian, I really do. 337 00:15:35.960 --> 00:15:36.480 I hate it. 338 00:15:36.519 --> 00:15:38.480 I don't know if it's because of my Westside genetics, 339 00:15:38.519 --> 00:15:40.600 but if I owe a human being a dollar, I 340 00:15:40.639 --> 00:15:44.519 want to discharge that asap and that and just you know, 341 00:15:44.600 --> 00:15:48.159 the idea of owning something outright just makes me feel 342 00:15:48.320 --> 00:15:51.360 very comfortable, you know what I mean. It's a psychological thing. 343 00:15:51.799 --> 00:15:54.720 It absolutely is. And here's a common situation that drives 344 00:15:54.799 --> 00:15:57.080 us question. So when people are in their late fifties, 345 00:15:57.120 --> 00:15:59.399 early maybe mid sixties and they still have a mortgage, 346 00:15:59.559 --> 00:16:01.480 that's you usually about the age that if there's an 347 00:16:01.519 --> 00:16:04.360 inheritance coming, then that's about when it's going to happen. 348 00:16:04.399 --> 00:16:06.960 So oftentimes people will have a wind fall. Now I've 349 00:16:07.000 --> 00:16:08.879 now got one hundred grand available that I don't have 350 00:16:09.200 --> 00:16:11.200 it doesn't have a job. Should I invest it? Should 351 00:16:11.200 --> 00:16:13.519 I pay off the mortgage or whatever? So, yes, those 352 00:16:13.559 --> 00:16:16.440 wind falls tend to drive that decision. And again there's 353 00:16:16.440 --> 00:16:19.279 a mathematical component to it. And I always let's start 354 00:16:19.320 --> 00:16:21.679 with the math. Here's the impact of investing it versus 355 00:16:21.679 --> 00:16:24.879 here's the impact of paying off all of your debt, 356 00:16:25.000 --> 00:16:27.039 And then we can start to see here's the mathematical 357 00:16:27.080 --> 00:16:29.679 impact that is known, it's black and white, it's in stone. 358 00:16:29.960 --> 00:16:33.039 Let's talk about how you will feel emotionally and psychologically 359 00:16:33.279 --> 00:16:35.840 doing one versus the other. That is usually the answer. 360 00:16:36.000 --> 00:16:37.960 As long as those basics are covered right. 361 00:16:38.039 --> 00:16:41.200 And another a shout out for financial planners who are 362 00:16:41.240 --> 00:16:44.879 working for you and have a fiduciary obligation. They will 363 00:16:44.919 --> 00:16:47.440 break this down for you. You don't have to do it yourself. 364 00:16:47.480 --> 00:16:49.519 And I think it's a critical thing for your future 365 00:16:49.559 --> 00:16:51.720 to have a financial planner so you can have these 366 00:16:51.759 --> 00:16:56.919 conversations and make informed decisions to maximize your investment opportunities. 367 00:16:56.960 --> 00:16:58.759 Brian James pause from them, and we're going to find 368 00:16:58.759 --> 00:17:01.240 out with a problem we're facing here in America. 369 00:17:01.720 --> 00:17:04.000 People are apparently pretty cash poor. 370 00:17:04.799 --> 00:17:07.400 Maybe some financial planning advice additional coming up next eight 371 00:17:07.400 --> 00:17:08.759 twenty six, fifty five KERC DE. 372 00:17:08.839 --> 00:17:11.240 Talk station fifty five KRC. 373 00:17:11.960 --> 00:17:17.920 This is this simply money minute, Channel nine. 374 00:17:17.960 --> 00:17:20.200 Wee forecast tells us we're gonna have some sun this morning. 375 00:17:20.200 --> 00:17:23.559 It'll be partly cloudy, breezy later today, possible showers fifty 376 00:17:23.559 --> 00:17:25.759 two for the high, partly cloudy every night for the 377 00:17:25.759 --> 00:17:28.599 low of thirty six. I have fifty six tomorrow with 378 00:17:28.640 --> 00:17:30.480 a little chance of rain in the morning, followed by 379 00:17:30.559 --> 00:17:33.759 afternoon sunshine, thoty every night down to thirty two, and 380 00:17:33.799 --> 00:17:36.200 the best chance of rain all week will be on Wednesday. 381 00:17:36.200 --> 00:17:40.880 But the bonus you get sixty three degrees thirty three 382 00:17:40.960 --> 00:17:42.480 right now if you've have KERCD talk station. 383 00:17:42.559 --> 00:17:44.640 Time for traffic, Chuck Ingram from the U see how 384 00:17:44.640 --> 00:17:45.240 traffic center. 385 00:17:45.240 --> 00:17:48.599 Around forty percent of cancers are preventable lifestyle changes, saying 386 00:17:48.680 --> 00:17:51.440 the screen memes can make a difference. Call five one three, 387 00:17:51.559 --> 00:17:54.160 five eighty five. You've see c see the lead us 388 00:17:54.200 --> 00:17:57.160 thanks to it. He'spend two to seventy five on Montgomery Road. 389 00:17:57.279 --> 00:18:00.160 Left lane's bocked in bend seventy four continues to be 390 00:18:00.200 --> 00:18:03.759 a slow go from above Montana from problems earlier. There's 391 00:18:03.759 --> 00:18:06.640 our rec on Union Center at Lakota West and on 392 00:18:06.880 --> 00:18:10.880 Madison at tlend shade Chuck Ingram on fifty five krc 393 00:18:11.039 --> 00:18:12.119 the talk station. 394 00:18:14.960 --> 00:18:17.240 A twenty nine if fifty gout KRCD talk station doing 395 00:18:17.240 --> 00:18:20.519 that money Monday thing with all the financials, Brian James. 396 00:18:20.559 --> 00:18:23.279 He is a financial planner, and maybe he can help 397 00:18:23.279 --> 00:18:25.160 out some of the folks who are dealing with these struggles. 398 00:18:25.160 --> 00:18:27.079 And it's kind of heartbreaking, Brian, when you read how 399 00:18:27.079 --> 00:18:30.160 many folks do not have money to cover, you know, 400 00:18:30.799 --> 00:18:33.519 an expense that might pop up. A lot of people 401 00:18:33.519 --> 00:18:36.519