TRANSCRIPT

hello sense of things it’s Jeff and Ron

here again for another weekly update on

what’s going on in the world what’s

going on in the economy and what’s going

on just with some fun so today’s show

I’m gonna lead the pack a little bit

we’re going to talk a little bit about

uh Halloween because it is Halloween

today we’ll talk about the Halloween

numbers for this year that are starting

to come out and it’s a little scary and

we will talk about the FED meeting

coming up on November 7th so two days

after the election’s over with fed meets

again a whole bunch of data that they’re

digging into I’ll go over some of the

data that really means something to them

and we can get an idea hopefully of what

they’re potentially going to do and I’ve

got a little bit of an update on jolts

numbers because we talked about that a

couple weeks ago and we just got the

updated numbers and I will share those

with you all

right we’ll be right back in just one

second

[Music]

[Applause]

[Music]

hey everybody it’s Jeff and Ron here Hey

Ron how you doing man good morning it’s

Halloween Halloween Christmas stuff’s

coming out tomorrow yay oh yeah it’s

already out but but yeah Halloween my

holiday where my house stays dark the

windows are all closed and we watched so

you’re the Grinch

of yeah no we watch Mel

Brook’s brain not working Young

Frankenstein tonight so 1974 good flick

1974 and in honor of kry gar ker gar we

just lost her this week in honor tonight

we shall toast her with

oval

so terrible yeah one of the most

beautiful ladies and funniest ladies

I’ve ever seen M and Mr Mom that was one

of my favorite movies with Michael

Keaton great movie with her Mr Mom I

think

her Young Frankenstein will always be my

favorite one with her because she was

hilarious a lot of people don’t know

this she actually was in an episode of

Star Trek she was only I think 19 or 20

years old huh that’s awesome I wonder if

sh head on her who knows I don’t think

she was ever in Mash but it seemed like

everybody else was right well when

you’re on when you’re on TV for 11 years

you never know yeah you’re going to roll

through a whole bunch of people during

that time period let’s kick us off here

real quick let me share my screen and we

will take a look at what is going on in

the wonderful world of

Halloween just get this to slideshow

mode and can you see that there it is

all right let’s get there all right okay

back in the day before pumpkins became

Jackal

lanterns they were turnips and I just to

quote Kanye West

huh at least you quoted him and not the

other one yeah I know no sh I always got

the two of those guys confused yeah I

did too and this is the good one the

other one is just a freak all right Sam

heop phobia is the fear of Halloween I

have heard that one before I you know

what I didn’t even go into the

derivation of the word to figure out how

what how what where it begins but that’s

something y’all can look up but it is

Sam

hopia is the fear of

Halloween 50% of kids prefer chocolate

candy for Halloween compared to 24% who

just like candy and 10% that like gum so

ping kids are they actually like getting

a real sample there come on yeah the

thing is yeah it maybe they may poll

kids but okay I never really had a

choice they just tossed what

10% prefer gum over chocolate or candy

get out over chocolate or just regular

candy at 10% there’s everywhere

so Halloween we covered this a couple

weeks ago Halloween is the second

highest grossing commercial holiday

after Christmas however this year

estimates are that spending is down

almost 25 or more percent from previous

years so Halloween is not what it was

when we were kids I remember remember my

mother growing up in Brooklyn she used

to come back to the house three times

because her bag was full with candy wow

you got to remember she probably went to

one one apartment building came back

again uh but yeah Halloween is not what

it was was yeah it was so funny because

I I see this all the time we were

rewatching the oh God I can’t even think

of the movie last night we were

rewatching and the kids are walking

around with three four five bags and I’m

like I just remember having the one

little pumpkin

and once the pumpkin was full we went

home man my dad was like no you’re done

dude you’re a you don’t need any more

yeah you don’t need any more candy we

did at Old School mom gave us a a brown

shopping bag

nice a brown shopping bag we didn’t do

anything fancy we had a brown shopping

bag that was

it once your shopping bag is full you’re

done there buddy well look my mother was

SM she wanted to reuse the bag she know

she knew my mom’s polish we we only use

the brown shopping bags for luggage

waste them on the good stuff you said I

didn’t I don’t know man that’s

terrible you did double bag it of course

of course yeah it’s what you had to do

and then the your lock through it was

just like a master lock that went

through the paper bag and just shop it

throw it on the sounds like a bad George

Carlin

joke what is the Fed considering before

November 7th so we go the the FED of

course skips their meeting in October

prior to the election and not making any

decisions so the next potential interest

rate decision is November 7th of course

the last one we know in September they

dropped at 50 basis points I haven’t

even after the election yeah haven’t

looked at the betting markets at this

point when we start to look at the data

that they’re going to be looking at

first off GDP this week came in at 2.8%

versus estimates of three

pce came in 2% which was in line with

with I see as the estimates there is

some argument to that because I was

hearing this morning that they were

going oh it’s it was way less and so

they’re going to be looking at it

personal income came in .2% versus 3%

and we’ve got non-farm payrolls and

unemployment and it’s interesting that

the it’s like the administration’s kind

of putting out there we’ve expect a bad

number so they may have heard something

that this is going to be an ugly

non-farm payroll number for this week a

lot of things that are big on the feds

on their agenda are coming in below or

in line what’s your thoughts on interest

rates

Ron I said in the beginning of the year

of course we all expected either a major

pullback or a possible recession even

shallow this year I said one to two rate

Cuts I said that in the beginning of the

year I still think that’s the case so I

don’t know whether that’s going to be

next Wednesday or December but I will

tell you I we were both shocked I was

floored at a 50% rate cut in September I

thought if they were going to do it

there would be 25 and I have heard some

expert people that I follow on both

sides saying not both sides politically

but both sides from the standpoint of

they should be raising much more

aggressively and other one saying don’t

touch it leave it alone yeah and I’m

listen listening and you’re hearing cun

arguments and I’m just saying one at

least one more Ray cut before the end of

the year I don’t know when or how but

again with your numbers I don’t know

what that necessarily means when you put

it into the FED crockpot as far as what

it’s supposed to

produce I don’t know the thing I’m

seeing is and you see it with a couple

of other numbers from previous weeks

like PPI and CPI PPI and CPI came in

1.8% that’s below the fed’s target I can

clearly see and I’m I may sound like a

complete idiot here but I could clearly

see another 50 basis point cut at this

point in in one meeting or over the next

two I could clearly see that happening

in noly crap because I think they’re

behind the eightball at this point and I

think they realize they’re behind the

eightball because things are slowing

massively fast if we look at the jolts

number so this jolts number actually

this is a little bit farther it’s not

really showing this month’s in here but

this month last month it was at eight

this month it came in at

7.44 so the job openings are cutting

down fast and usually you have a little

bit of more job openings towards the end

of the year because people are trying to

get things in place for the next year

and this has been on a precipitous drop

for two straight years now and I think

and we’re getting to the point where

we’re actually below the trend where we

were at before the pandemic and

everything else and then the recovery

we’re heading below that number and

that’s not the trend to be on if you’re

a trend follower that’s higher or lower

lows and lower Highs are not the place

you want to be in a lot of cases and the

other component into this is going to be

next Friday the jobs number yeah this

look the Som Ru triggered the next the

next month it I think it was flat and

now the next month if the unemployment

precipitously ticks up I agree with you

on the 50% rate cut but here’s the

interesting thing there was a big run up

into that September meeting with that

50% rate cut look what happened in the

the 10 year went from 36 37 it’s at 43

today that shocked a hell of a lot of

people yeah that tells me if you we get

another 50% rate cut we could be headed

back to five and I think that would

throw a lot of things for a real Loop

especially mortgage rates that got all

the way down to about 6% has now jumped

back up to 6768 again yeah and popping

those above seven again that’s gonna put

the breaks on the housing market again

and sales and everything else it’s

interesting because that short we went

from a wildly inverted yield curve to

WAP the other way around and it’s

getting higher and higher from the 10

year and Beyond so you know that’s the

smart money in town saying things are

not as good as you might think and

that’s what a lot of the key experts at

least I follow have been saying for two

years you just don’t know when they said

it’s not when the yield curve curve

inverts it’s when it rein verts to the

upside right that’s and I got to tell

you all that is starting to come to

fruition we just don’t know when

potentially there may be a true break

look we’re due if not for a five we’re

definitely due for a 10 to a 15 %

pullback in the market which would be

healthy for people to add new money in

for the next leg up we cannot continue

at the angle of the trajectory that

we’re in right now because it’s not

healthy it’s not healthy look it looks

great for all of our client accounts

they’re all happy some of the ones that

have been around the block a few times

like you and me and

older they they’ve been worried for over

a year yeah they’ve been worried for two

or three years at this point but more so

in the last year

that’s what I found and we’ve been

legging out going into more gross stuff

they keep peeking around the corner like

a good investor should yeah and I think

seeing the numbers for Microsoft and Fa

or Facebook today just going through the

numbers they both had really good

quarters but the stocks are down today

and a lot of it is and I’ll do a piece

on this a little bit later but a lot of

it is the massive spend that they’re

having to make on AI and that’s the

downside piece of ai ai is wonderful

it’s a massive productivity thing but

the problem is to build the

infrastructure inside of these companies

and shift the infrastructure it is a

massive investment and money and time to

get that done but we all know this right

go back to the mid to late 90s they

overbuilt yep with inflated prices and

PE we don’t need to rehash history but

here’s what happened by the time we got

into the early 2000s all that build out

was now Antiquated technology yeah right

so now there was more of a spend for

data centers and chips and what happened

with the internet too we went from 144b

to 28 B to 64 bod oh we can now do

member the ISDN lines then eventually

cable came in so there’s always an

evolution what happened to the old

technology right that the window but

also what happens with new technology

many times it’s cheaper than what it was

I remember when you paid $10 a gigabyte

for memory yep you you could spend $10

now and get like an eight oh that’s for

a megabyte you could get a you could get

an eight gigabyte thumb drive or

whatever H I don’t even know what they

cost now I just’s gonna all this money

now they’re spending all this money now

on this technology which may be

Antiquated in 3 to five years and they

going to keep spending but they’re

printing money and they could do it I

have a computer here in my office that

was an old computer that I had that I’m

using just for another project I put a

one

terabyte solid state drive for $75 into

a d and could have put I I think I could

have put upwards of three terabytes for

75 bucks it’s insane what would that

cost up good AI do what would that have

cost 25 years ago you so SP 75 bucks I

bet you that was 10 grand oh yeah and I

couldn’t have even found yeah first off

I couldn’t have found more than like a

512 uh solid state drive up until three

years ago now all of a sudden you can

buy a three or four terabyte I’m like

good Lord I could put and I don’t think

solid state was available 2025 years

that and that’s the new thing and that’s

what’s really making it much more

realistic you can grow it faster when

you don’t have that manual Drive anymore

but yeah the reality is yeah it’s

changing but I I think I personally

think that the investment that they’re

making in a lot of this is yeah it costs

a lot but it can massively improve your

company it massively it allows you to

handle massive amounts of data but guess

what they’ll make money at the

Enterprise level we all agree they’ll

even make money at the midmarket level

that’s a given yeah where they really

want to make the money is at the

consumer level y I don’t see it I don’t

see they have to prove it to me in time

look how many people like stopped

wearing watches CU they had the phone

for the time now people are wearing

SmartWatches now yep that’s fine but it

took time so they’re gonna have to prove

to me that they’re going to be able to

monetize the consumer that they’re going

to use AI hey Dick Tracy in 1947 had a

watch that he could talk to it only took

until 2023 for that happened there the

government Black Ops got with him

because of Technology was way too ahead

of his time yep that’s it took him out

you’ve not seen Dick Tracy since people

that took out K JF JFK you know that

yeah exactly of course the Dick Tracy

franchise was taken down by Warren batty

so oh you didn’t like that movie oh I’m

sorry I’m thinking of Bugsy I love Bugsy

bugy was great Warren batty doing doing

Dick Tracy if Dick Tracy was ever going

to have a comeback the most uncool

person you could could possibly put in

that chair is warant listen you know why

he did that movie I have no idea he he

was dating Madonna so he got suckered

into that bad boy yeah here we’re gonna

put you in the worst movie that’s ever

existed and will literally kill your

career he was tail end of his Hound days

anyway so that’s true yep folks we

didn’t mean to get into a movie thing I

just went there Tracy thing but you know

us and we tend to go off track sometimes

but thank you very much for joining us

have a happy Halloween looks like across

the middle of the country you’re going

to be getting a little bit of rain it

was dark here for a few seconds and now

it’s light again the chances of us

getting any rain are nil and we’re going

to go on till nine days without any rain

here in Central Texas pray for us a

little bit we could use a little bit

because things are a bit

parched so thanks a lot make sure you

subscribe to the channel and we’ll see

you back here the very next time e