good morning sense of things welcome to

another episode of our weekly updates

markets economy and a little bit of fun

sometimes too Ron how you doing bud good

we always need to have some fun in this

day and age my friend it is man there’s

too much crazy stuff going on in the

world but it’s it’s always fun to just

have that kind of just share a few weird

facts and stuff like that so why don’t

why don’t we kick it off with with some

facts about summer because we’re coming

up Summer now it’s here it is well not

officially we’re getting close

so so let’s talk about some of the fun

facts of

Summer um first off the Eiffel Tower did

you know that it grows 6 Ines in the

summer due to thermal expansion I would

have figured it would all right I guess

it goes up too I would figure wide

versus tall but okay yeah here’s the

funny part too it also leans away from

the Sun seven in throughout the summer

so it moves itself around and grows at

the same time there’s no way they could

have known that when they built it but

that’s interesting oh absolutely not no

they have no idea what thermal expansion

was back then but of course there’s all

the scientists have nothing better to do

but measure the the Eiffel

Tower I don’t think this is a big

surprise to anybody but thunderstorms

are more common in summer because warm

weather allows the atmosphere to hold

more humidity that makes sense unless

you live in Arizona which there’s not

very much humidity there late late

summer early fall which monsoon season

okay that’s true let me tell you let me

tell you the rain does come down and the

wind does blow so

oh the longest day of the year is our

summer solstice which marks the sun

reaching its highest point which I

thought was somewhat interesting first

day of summer is between June 20th and

June 22nd every year uh but the date

varies due to the Earth’s rotation I

thought it was actually on the same day

always but did not know that dog days of

summer we always hear that what is the

dog days of summer that’s between July

3rd and August 11th when dog the dog

star Sirus is in the constellation Canis

Major I just thought they called it the

dog days of summer because it’s so damn

hot freaking hot that you’re just like

like you’re lazy as a dog like if you

live in Texas or Arizona during those

time periods it’s you want to be the dog

that’s inside the house much better with

humidity over a period of time so

believe me there were dog days there too

yes absolutely Americans eat over seven

billion hot dogs between Memorial Day

and Labor Day yes and if people read

what the ingredients where they wouldn’t

eat them they wouldn’t eat them yeah

exactly that’s it I recall a comment in

the movie summer vacation or whatever it

was with John Candy I won’t go there

watch the movie Great Outdoors Great

Outdoors yes Great Outdoors Dan arroy

too great comment about what the hot

dogs are made of by the the local by the

local raccoons largest ice scoop or ice

cream scoop weighed

3,1 or 3,10

lbs um I want to I want to see the

contraption that scooped that no kidding

and I I can completely understand this

because if you’ve ever been on probably

use the back ho yeah if you’ve been on

any kind of vacation in Europe I can

believe that people are walking around

with 3,000 pound ice cream Scoops

because that’s all they do is eat ice

cream interesting one Americans eat 15

pounds of water melon every year I I I

can tell you I’m on the lower end of

that one because I’m not a big

watermelon I got to tell you I used to

really like watermelon a lot I hate the

seeds I haven’t had watermelon in years

though yeah I think the only time I ever

eat it is if I’m like on some kind of a

business trip or something like that and

I’m eating at the hotel that’s about the

only time I eat watermelon at that cold

watermelon on a hot day is great oh it’s

awesome but yeah I just never been a big

fan and last summer fact out of all this

the Northern parts of Canada Russia

Norway Finland and Iceland the Sun never

sets All Summer Long yeah white nights

white nights or the lands of the

Midnight Sun Sun never sets of course in

the wintertime Sun never Rises take your

time period

there um just a little bit this week on

economic stuff it was really a quiet

week on economics two real key numbers

that really had some effect on the

market the PPI the producer price index

year-over-year

is still continuing its Trend upward

which is not really going in the

direction that the the administration or

the markets want so we saw a little bit

of activity on Tuesday when all that

came out it was unexpectedly higher than

what was expected and then what a

difference a day makes we come into

Wednesday and we have one of the biggest

Market Days up because CPI basically was

where CPI they thought CPI was going to

be slightly down by one tenth of a

percentage Point uh but it’s still up

3.4% year-over-year so it’s persistent

there and it just doesn’t want to go

down so it’s been in this kind of

Flatline for the last several months and

I think I don’t see anything that’s

causing it to go down at this

point not

yet so my final stuff wanted to talk a

little bit about everybody’s so hyper

hyper focused on interest rates what’s

the FED going to do when’s the FED gonna

stop raising interest rates and I heard

some comments this morning on the

business station when I was coming in

and it made a heck of a lot of sense to

me that maybe there’ll be a little bit

more of a behind the scenes rate cut out

of the federal the fed and then also the

treasury so the FED if you read the

transcripts of the last fed meeting

everybody was so hyperfocused and of

course the news was focused on are they

going to raise or lower interest rates

and what are they saying in the future

and all that but the part that I think

most people missed and didn’t really pay

attention to is the fact that they’re

basically stopping quantitative

tightening which has been going on and

and basically all quantitative

tightening is the Fed stops buying

treasuries from Banks and so when they

stop buying those that dries up

liquidity inside the banks they

announced that they’re going to stop

that quantitative tightening so they’re

going to go back to normal so they’re

not in that situation where we’re in

quantitative easing where they’re going

out and buying treasuries from all the

banks and creating more liquidity but

they’re just going to stop the

tightening part of it and they’re going

to go back to normal activity which if

you look at that’s about 85 billion do

or 85 trillion dollars over a period of

overtime or I think no excuse me 85

billion so it’s a little bit of a move

it means there’s more liquidity in the

markets and it means that the banks have

a little bit more to go the treasury

also announced that they’re going to

start

re I guess rejiggering in anticipation

of rates starting to come down they’re

going to be doing some refinancing in

the fall of some of our debt so that

they can take advantage of potentially

the lower interest all Financial

engineering it’s all Financial

engineering and the other part of that

is that creates liquidity inside the

system as well so it it might not be the

overt fed coming in and saying hey we’re

going to lower interest rates but some

of this behind the scenes stuff can

actually start to reduce interest rates

at that point uh mainly because as

interest rates go down it’s going to

lower the the or or that’ll decrease the

dollar which can also decrease interest

rates as well so more to see we’ll keep

an eye on that but I think that’s an

interesting look at what we could

potentially see from that piece of it

the last piece I wanted to cover is

really the earning season if you look at

the S&P earnings are expected to be up

almost 9.1% from the same period last

year with about 4 and a half% higher

revenues so it’s it really has been a

good earning season there’s been some

companies that have struggled a little

bit but industries that are either Tech

AI focused or ones that are focused on a

little bit higher end higher middle

class and higher end consumer they’re

doing extremely well so if you look at

some of the the big earnings beats

Walmart now it’s interesting because

people typically think of Walmart as

being the lower-end consumer but Walmart

has been a beneficiary of the higher-end

consumers moving down the chain a little

bit so the target con the Target

customers becoming the Walmart customer

which is causing Walmart had phenomenal

numbers Home Depot same thing if you

look into the tech space Cisco had a big

monster quarter John Deere doing

extremely well ba and couple of other of

the big Chinese stocks coming out of

years of awful there H&R Block

interestingly enough which has not done

well for years had an outstanding

quarter and then Dropbox which dropboxes

had been the one that was falling by the

wayside with some of their other bigger

competitors but uh it’s having a big

Resurgence now with some of the AI stuff

that they’ve started to add into their

piece of

it any thoughts on that but even with

the consumer-based companies they’re

still saying that they’re seeing

slowdowns yeah

yeah and like I said but they’re slowing

down especially in the any anybody

that’s exposed to the lower income

consumer if you look at McDonald’s we’ve

had these conversations about Starbucks

and McDonald’s and stuff like that it’s

that

discretionary it always worries me when

you see McDonald’s struggle because for

a lot of people that is their primary

source of food because it’s cheap and

inexpensive and easy to do especially

for working parents but when they start

to struggle when the lower end consumer

struggles that’s where you start to see

the cracks in the system a little bit

when the price of Labor goes up 20 30

40% yep it’s got to get passed on to

somebody yeah yeah and the consumer just

doesn’t have the ability to pay those

higher prices and especially California

where your Happy Meal is $9 where other

places it’s a couple dollars it’s just

they’re just buying a Happy Meal for the

toys yeah that’s it do too but I’m just

saying so what do you got all right so

of course let’s talk about some worst

decisions in business history so I just

got three here today but one of them I

thought was interesting which is

Motorola which before the smartphones

came out they had the best product Oh my

favorite phone ever was pocket the razor

was good and what happened in the last

two years it made a comeback M right not

strong

but it made a comeback obviously with

some other new features for texting and

whatever but I just thought it was

interesting that they just thought like

the iPhone would probably be a fad

Blackberry will just fade out but hey

they misread the market like Kodak and

Blockbuster and so many other companies

saying hey we don’t want to kill the

Golden Goose we got to keep going here

it’s interesting I didn’t know that that

uh Motorola Mobility is now owned by

Google yeah I forgot when that deal

happened but that was a while ago but

they had no choice it was like Nokia

right Nokia European market they got

taken out

too well just I I worked with them with

the on the 401K side and I it just

always made me laugh because it just

they create they stopped innovating they

were so Innovative early on with cell

phones and then they just stopped and

just wouldn’t move beyond the the same

phones that they’ve been using years

after years

that’s what happens when you got bad

management yep Red Lobster now I saw

this and I thought it was interesting

because they they they just announced

more closures okay and this kind of

caters to a certain part of the market

and this part of the market they can’t

make it but I thought it was interesting

the last paragraph here talked when they

used to have the all you can eat

obviously nobody added up the cost of

the snow crab thinking okay you know

what we’ll give away the snow crab so

they’ll get three or four drinks yeah or

or whatever some kind of a lost leader

when somebody’s coming in so I thought

this was interesting too again you know

they just the price of goods have gone

up price of Labor has gone up but the

people that typically would frequent the

restaurant just can’t afford it anymore

yeah and then you know you end up with

you yes it’s labor and everything else

but the cost of crab you know I’m a huge

fan of the show Deadly as catch and last

year B basically they shut down the

Fisheries for crab fishing you know so

those guys were all doing Cod and all

kinds of crazy crap that they normally

wouldn’t have done because the FED said

it’s we can’t really do the surveys and

we don’t know what the the population of

crab is so we’re just not going to do it

yeah we’re not going to allow fishing

and that just blows the cost through the

roof on some of this stuff absolutely

supply and demand on that part and then

the last one a& W now anybody that’s

ever made a root beer float

yes barks is good but there’s nothing

like A&W vanilla ice cream sorry so but

rather ironically when A&W used to have

the sites and there are a few Stewart

locations out there if you could find

them but they created a third pound

burger to compete with McDonald’s

popular quarter pound qu pound and

offering it at the same price but

apparently people can’t do fractions

very well so people just thought that

the quarter pounder

was a bigger Burger than the third

pounder this is once again a testament

to our educational system yes yes so

even if it was the same price Quarter

Pounder still sounded more than a third

still it’s bigger it’s got to be bigger

than a third pounder a quarter four is

is bigger than three come on and

apparently people didn’t have a very

catchy tagline for it either but who

knows no all right so my last slide here

I thought was interesting they didn’t

get this slide ready for when it came

out Apple announced the largest buyback

in history 110 billion and for people

that don’t understand how BuyBacks work

and I am not an expert in this area they

don’t buy back 110 billion today no I

believe it’s over a two to three or

three to five year period of time that

there’s a window when they see fit they

could buy back up to 110 billion and

most companies from what I understood

and I had heard and read this years ago

typically only do about half to 2third

of what the allotted window allows yeah

over time but obviously the announcement

just propelled the market but I thought

what was interesting and some of these

names will shock you what does $110

billion dollar buy in market cap and

these are just notable companies these

aren’t all of them so here they are wow

here I know it’s above 110 and so is

locky Martin thought to give you a

couple of names and perspective of deer

lock Boeing obviously Boeing Boeing’s

working their way far down below that

110 billion right but the General

Dynamics northr Grumman here’s the one

that shocked me FedEx yeah think about

the infrastructure that FedEx has I

thought that they would be over a

hundred billion in market cap they’re

only 65 Ford is half okay hold on a

second so then my last thing is what can

you do with 110 billion crap you could

have bought GM and Ford with all that

money with a little bit to spare the

entire company they could have just

bought back Ford in GM give you an extra

they had some extra left over they could

have given a billion in premium who

knows yeah that is amazing it is amazing

that’s what $110 billion buys you

brand names yeah yeah and this is just a

buyback of their own stock and you could

have literally bought the you could have

completely bought all these

companies yeah that’s shocking to me but

yeah it just it’s amazing puts it in

perspective because a billion here a

billion there all right a billion no

look at market caps of these brand name

companies that is more or or I’m sorry

that is less than what Apple’s buyback

is it just the numbers are just

staggering at when it’s going to come

back down to earth I don’t know we could

be much much much deeper into our old

years before it ever comes back to Earth

but this is insane but they wouldn’t

have the cash to be able to do this if

they weren’t selling a whole lot of

freaking

phones but if you noticed all of their

sales and earnings numbers down so this

buyback they had to have some kind of

good news in their earnings report

obviously this is staggering yeah that

was what they had to do to get the sniff

off of all the other stuff was oh but

everything sucks but we’re gonna buy

back because we got a ton of cash left

over um it yeah like I said and that was

for years that was the the modus

operandi for a lot of these companies

that were they would go out and borrow

money and then turn around and do the

same thing they were borrowing it and

money we money was 1% or whatever it was

borrow it yeah they could get it super

cheap so it’s okay you buy your you buy

back your stock you turn around and

finance it and buy back your stock and

then pay that debt off which I guess is

a a decent use of capital at that point

they a lot of times use it to mask the

fact that they’re really not doing great

and apple certainly has not been doing

great for several years now we’re

covering up the pothole with

papier-mâché paper there we go exactly

so we’ve just a little papier-mâché

little wallpaper on the street to cover

up the pothole yeah I we’ll have more of

this stuff in the future more stuff here

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