Jeff Kikel: Good morning Cents of things it’s  jeff and ron here once again for another week  

of fun things Market things and economy  things ron. How you doing, buddy? Good

Ron Lang: morning. Good we’re gonna wrap  up my series this week for a little while  

on bad business decisions and get  a little couple of things related  

to bad debt and inflation And market internal.

Ron Lang: Let’s just jump into

Jeff Kikel: it. Why don’t we

Ron Lang: kick off?

Jeff Kikel: I’ll be sad to see the bad  business decisions because they’ve been

Ron Lang: Putting it on pause because we’ve  been going through that. I don’t want to go  

over In about a month so You can always look into  a couple of those in the near future All right.

Ron Lang: So here we go.

Jeff Kikel: Oh god.

Ron Lang: Hey matt if you’re from  boston. Hey matt, here [00:01:00]  

we go So kmart was bigger than  walmart for decades And Kmart  

then had to merge with Sears and  that didn’t go very well either.

Jeff Kikel: The other worst retail  company in business in the history.  

I always used to love Sears and  it became part of Kmart later on.

Jeff Kikel: They had such a horrible  inventory system that I remember every  

time I’d go to Sears to buy  something, I was like, okay,  

I want to buy X. Let me go check in the back  to look. Okay. You don’t have something you can  

just look up on the computer. It says we have  it, but I’m going to go back and look for it.

Jeff Kikel: So it was two horrible  inventory companies or, merging together.

Ron Lang: The one thing I thought was interesting  was on the fortune 500 They peaked in 95. I didn’t  

think they got that high up in the night  I thought they peaked in the 80s. Yeah,  

but I thought the other interesting thing was  37 billion They peaked in revenue in 2000.

Ron Lang: I think walmart does that [00:02:00]  in a quarter? Yeah, right or half a year I think  

they do that a half a year now And I do this  20 years ago. It may be bigger. Yeah walmart.  

I believe You Makes up 10 percent of the  retail market their revenue sales. That  

was years ago. Maybe higher now I don’t know  because obviously they’re going more up market.

Ron Lang: They’re going up  maria, but they’ve also gone

Jeff Kikel: They’re the number two  Online retailer behind Amazon and they’re

Ron Lang: getting more market share.  Yeah, I’ve gotten stuff from there  

make it really convenient if I couldn’t it’s  not that I couldn’t find something on amazon  

for certain things you price compare  Walmart’s been cheaper than amazon,  

which You know, 10 years ago or five  years ago, you really couldn’t say that.

Ron Lang: The other part is,

Jeff Kikel: yeah, we do it for for  like supplies here at the coworking  

space. A lot of times we order from  Walmart. I could get in my car,  

drive over to Walmart, pick  it up and then bring it, yeah,  

bring it back here. Or I can just order a box of  paper [00:03:00] towels or something like that.

Jeff Kikel: It’s literally here that  afternoon. Yeah. And I have no delivery charge.

Ron Lang: Yeah. So Kmart and Sears  Roebuck, they’re just going to end  

up becoming a distribution centers  or turn into condos or something.

Jeff Kikel: Yeah. Why all of the Sears I know  

of are closed. I don’t think there’s  any of them open anymore. And I just

Ron Lang: saw, I just, I forgot  what street I drove down.

Ron Lang: And I saw it was all, it was taken  down, but you can see it on the side of one of  

those Sears this tire discount centers. Yep. Used  to buy my tires there all the time. Yep. And then  

Firestone at one time. Was the tire more than good  year more than a Michelin. They were the tire.

Ron Lang: And then the people remember what  happened with them. They their quality of tired,  

it was not so good for a while. And they, it’s  interesting. I thought it was later that they  

peaked as a top company in 56. [00:04:00] I  don’t think how far back they went, because  

if I remember correctly, the car was invented,  around the turn of the century, 1900 or so.

Ron Lang: And for four or five decades,  you had Firestone tires on your car.

Jeff Kikel: The other, yeah, the other part  was that Firestone’s daughter was married to,  

I think Ford’s son. So basically for  Firestone Firestone was a Was a kind of a,  

an understudy of Henry Ford. And so every Ford  for since 2000 or 1916 or something like that,  

all the way through until the eighties, every.

Jeff Kikel: They have Firestone  tires were on every Ford car.

Ron Lang: I think here’s the interesting  thing, right? When you’re in PR deny deny,  

deny. Here it is, right? The national  highway and traffic administration,  

1980 found that they were actually aware of  the defective products going back eight years.

Jeff Kikel: Yeah.

Ron Lang: [00:05:00] So you add up  those lawsuits, you’re out of business.

Jeff Kikel: The funny part, I’m just looking  right above that. Initially Firestone blamed  

tire failure on substandard maintenance by  the consumer. Yeah. Blame the guy who bought,  

yeah. Blame your customer.  That’s a really good strategy.

Ron Lang: Yeah. Yeah. Your fault. Sorry. Yeah.  You didn’t have a good alignment on your car.

Ron Lang: That’s why the tires fail.

Jeff Kikel: You didn’t rotate  your tires. So that’s the problem.

Ron Lang: Yeah. So I, you know what, look, I scour  a lot of key things for information like you and  

we’ve talked about credit card debt and credit  card Delinquencies and carryover debt and past  

due debt. I thought this was interesting  from the philly fed reserve and again,  

we’re not going to have time to go through  all this But in the upper right if you just  

look at the three charts credit card delinquencies  past due over 30 60 and 90 days Now this is only  

through the first quarter of the year, but just  look at how they’re [00:06:00] starting to peak.

Jeff Kikel: Yeah Not good. This Yeah,  this remember a couple weeks ago. We  

did that piece from the the federal reserve of  st Louis and yeah similar thing. So it’s yeah,  

it’s showing across the All their little segments.

Ron Lang: I thought this was interesting  too. I just wanted to bring this up that,  

here, this is 2013, 2012, 13.

Ron Lang: So we were three to four  years coming out of the 0 financial  

crisis. And even though the market was  starting to soar, then a lot of the internals,  

it just took four or five years to go  through what, but look how high it was  

back then. We’re basically at the height of  when it Pete. At that point I don’t know again  

How do you say oh when does this take a real  effect onto our economy and to the consumer?

Ron Lang: Who knows could take  another three months or three years?

Jeff Kikel: I think that I think the difference  between now Yeah, the difference between  

now [00:07:00] and then is you know, your  credit card interest rates were maybe six  

seven eight percent On the high end. Now they’re  22, 23, 25%. That’s what’s going to kill people.

Jeff Kikel: And I don’t, I honestly  don’t understand. You’ve got all these,  

the Elizabeth Warren’s of the world  and all that. But nobody has looked at,  

it’s nobody is saying anything about.  Okay, are we just literally reaching a  

usury point? With some of these credit card  rates. Okay, your fed funds rate is what six  

and your credit card rates are 22 23 25 and  nobody’s saying anything in the government A

Ron Lang: few people did raise their  voices, but it fell on deaf ears.

Jeff Kikel: Yeah. It’s you  know, once again, i’m like,  

okay So you’re worried about my You know,  you’re worried about that. I have a gas stove,  

but how about this tub stuff? This  is what’s going to freaking destroy  

a [00:08:00] lot of people’s finances for years.  I’m, cause we’ve seen, yeah, for their lifetime.

Jeff Kikel: Yeah. It’s going to completely  destroy that. The good thing is the first  

lien mortgages are still performing. The thing  that I look at there, at least. People have low  

interest rates on their mortgages. So they’re  a little bit more stable. It’s just. You know  

the new kids on the block aren’t going to get  to buy a house because they can’t afford one

Ron Lang: now and the last thing I just want to  bring up move on to the next one is we talked  

about this in a About a month ago in a podcast  about how banks and credit card companies are  

Decreasing credit lines and here’s something  here’s i’m sorry are not increasing credit lines.

Ron Lang: It’s going down I didn’t know that  they had a stat or even these companies said,  

let’s say you had a 10, 000 credit  limit. Sorry. It’s only eight now.

Jeff Kikel: Yeah.

Ron Lang: That has been increasing.  I didn’t even know that was a thing.  

I thought if you have a credit  line, that’s your credit line,  

they don’t have to increase it, [00:09:00]  but I didn’t know that they could decrease it.

Ron Lang: I thought that was interesting.

Jeff Kikel: Yeah. It’s very interesting. I  think it, if people that are staying close  

to the top end of that’s where you’re  seeing them pull it back a little bit.

Ron Lang: So this one I ripped off of wallet  hub and but it just wasn’t a clear thing So  

I wanted to point it out that the color chart  here is percentage So if it’s very light blue,  

that means that’s four percent if it’s dark  navy blue That’s 24 It’s pretty Bifurcated  

here as far as where people aren’t paying  their mortgages You got a little new England,  

you got North Carolina here, you got  Florida, which doesn’t surprise me.

Ron Lang: It’s interesting. You can, Cal, Texas,  California, some of the Southwest states are  

doing okay, but that’s still in the 10 percent  range of people not paying their mortgages.

Jeff Kikel: Yeah. It’s interesting. You’re like,  Arkansas, I can tell you, yeah Hawaii makes sense.

Jeff Kikel: Cause it’s just fricking  expensive to live there [00:10:00] period.  

A raise in your interest rate, buying a  new home is going to just crush you. But,  

Arkansas has traditionally been a  pretty inexpensive place to live.

Ron Lang: Yeah.

Jeff Kikel: But I will say, I, one of the  things I do is tax lien investing and I’ve  

seen a massive increase of the inventory,  so to speak, of tax liens in Arkansas.

Jeff Kikel: It’s really interesting that the  spike up that I’ve seen there, cause it’s okay,  

if you’re not paying your mortgage, You’re  probably not going to pay your taxes too.  

Cause a lot of people have it, built in Vermont.  Yeah. Over 20%. Yeah. It’s interesting. Then  

Vermont, then New Hampshire is absolutely  nothing, which is just completely crazy,

Ron Lang: right? And rhode island is bad too.  Yeah Again, I don’t know why was it the banks  

or the mortgage companies there? They were  just giving it to you know to bad Credit,  

I don’t know. It’s just very interesting looking  at this chart Like where bad mortgages are.

Ron Lang: I don’t want to say bad mortgages, but  people saying the billing to pay their mortgages  

when that’s [00:11:00] potentially there’s  more layoffs there that people are out of jobs,

Jeff Kikel: I don’t know. I’m  trying to remember it, going up  

from Texas. What’s the dark one  there. So that’s gotta be what.

Jeff Kikel: Nebraska. This year.

Ron Lang: I dunno, I’m a flyover  state guy. So I know East and West.

Jeff Kikel: Yeah. I’m just trying  to remember. So it’s Oklahoma.

Ron Lang: I know this is Colorado. I can’t  

believe we’re doing this. We’re  going to get, we’re going to get

Jeff Kikel: F’s on our report card here. I know  it’s terrible, but yeah, it’s just interesting.

Jeff Kikel: That one’s so high. Wow.  And usually in the flyover States,  

it’s just less expensive to live. So yeah. Yeah.

Ron Lang: So this was interesting we’ve  talked about this, but when I saw this  

and I had to rip this off So I had to cite  my source down there kobe se he’s featured  

on some different financial Programs  and bianco obviously he’s a big bond  

guy follows the bond market, but I thought  this was just you know Very interesting here.

Ron Lang: We always talk about  [00:12:00] The weighting of the  

market and just to go through this out of the  9. 1 percent 9. 16 percent year to date gain,  

NVIDIA is three and a half percent, Amazon,  Microsoft and Meta account for another 1. 4%.

Jeff Kikel: Yeah,

Ron Lang: meaning 54 percent of the S& P  gains this year or stocks. And if you take a  

look at history and I saw something, I don’t  have the chart up here, but when you have four  

stocks that make up better than 35 percent  of the market, it’s followed by something.

Ron Lang: Not so good. Yeah,  and I believe 4 of those times,  

don’t hold me to this. If I can  remember the chart was 0809. com, 87,

Jeff Kikel: 1929, I think the  difference this time though,  

and we had this discussion a couple of weeks  ago. The difference that’s going on this time,  

though, is until, [00:13:00] the, these things  are so widely held by S& P 500 funds and,  

from the 401k world, you and I both have  worked in the 401k world for a long time.

Jeff Kikel: There’s this been this massive  shift of reducing expenses and 401k plans. So  

the majority of 401k plans have shifted  to where it’s an index fund. Option,  

there’s index fund options, mostly in your 401k.  So until I, I personally think it’s going to  

continue be supported up until we see  some kind of a change in employment,  

when those checks stop coming in, all of a  sudden, that’s what I think has some effect  

on the S and P at this point, because I just don’t  see it stopping unless the S and P does another.

Jeff Kikel: Reshuffle again. Yeah, because hey,  this is now 20 percent of our index. We need  

to make a reshuffle from these. I just don’t  know what stops it [00:14:00] at this point.

Ron Lang: You know what listen talking to  listening to smart people It’s a catalyst  

what that catalyst is To be determined could  be political could be economic a lot of people  

think it’ll come out of the financial sector  again especially with the the regional banks  

and their exposure to Commercial credit, but  that, that could be a couple of years out.

Ron Lang: Could be geopolitical.  It could be a number of factors.  

Sure. It was a three dimensional chess or NVIDIA

Jeff Kikel: out of all of those, I think  NVIDIA and Microsoft probably, we’re in a,  

an interesting new time when it  comes to artificial intelligence.  

It is the internet of our, it is  the internet of this generation.

Jeff Kikel: Yeah. For our generation, it was the  internet, his personal computers and internet,  

I think artificial intelligence is. The thing  for this new generation and NVIDIA, I, for the,  

at least for the [00:15:00] foreseeable  future is going to be the beneficiary of  

it because they are the backbone of most of  what’s going on with artificial intelligence.

Ron Lang: Yeah. But Jeff, this is the thing  that kills me about AI. AI has been around 40,  

50 plus years. Oh, sure. They  just didn’t have number one,  

the computing power or the data warehouse to do it  from. And this is the other thing too, right? We  

there is so much air under the prices of these  stocks Because it even if they get you know,  

they’re ducks in a row With the computing power  in the data warehouse now, you got to analyze  

it How do you know that analysis is helping  your company make better business decisions?

Ron Lang: You won’t know that for  another three to five years until  

they go through an aggregation and  very a lot of iterations of You Okay,  

let’s spin it this way. What does it say? Let’s  spin it that way. They don’t know today. All they  

know is they’re just doing all the plumbing  and the electrical work [00:16:00] right now.

Ron Lang: They don’t know what it’s going to  look like. They don’t know how it’s going to  

help them, but you know what, if they don’t  mention AI in their earnings report, their

Jeff Kikel: stock goes down. You look at Apple,  

Apple’s been languishing along pretty much  most of this year because they’re behind  

the I think a lot of this is complete  bullshit in a lot of these companies.

Jeff Kikel: They’ll just mention AI and,  we’re working on artificial intelligence,  

at least Apple was honest. They’re like, eh,  

we’re not quite there yet. We’re not willing  to release anything. Yeah. But you know what?

Ron Lang: I think they’re bluffing. Yeah,  there’s no doubt they’ve been working on AI

Jeff Kikel: without a debt, but the difference  I think with Apple and has always been this way,  

they don’t release stuff  to just throw it out there.

Jeff Kikel: It’s like when they release  something, it’s, it is the top quality,  

top tier, albeit who cares, what, whatever  your feeling is about their products,  

they are top tier, premium products. So  I’m sure yes, I have no doubt that behind  

the [00:17:00] scenes they are feverishly  working on this, but they’re not going  

to release anything until they feel like,  okay, they don’t want a Google moment of.

Jeff Kikel: We were, everything’s going to be  

Gemini and then you start to look at  Gemini and it’s a pile of garbage,

Ron Lang: it’s gotten better. But the other  way you got to look at it too with Apple is  

they’re not going to release a 1. 0  version. They’re going to wait until,  

you know, it’s battle tested internally  and it’ll come out with a two or 3.

Ron Lang: 0 where the other ones are like, Hey,  we got to put something out there. Yeah, we

Jeff Kikel: just got to

Ron Lang: throw

Jeff Kikel: it out there and then we’ll, yeah,  

the typical Microsoft throw it out there and  fix it on, on the fly with their updates and  

stuff like that. Apple is going to go,  okay, we’re going to test it internally.

Jeff Kikel: Make sure it works before we piss  off all our customers and throw it out there.  

No more window Vista incidents. Yes. No Vistas  or, the every it’s every third day. Microsoft,  

you have to be at a certain age to remember  that. All right. That’s all I got. Good  

stuff. Once again, sad to see [00:18:00] the  bad business decisions go away for a while,  

but they’ll be back because  there’s always going to be

Ron Lang: bad business decisions

Jeff Kikel: will continue to make  stupid decisions no matter what.

Jeff Kikel: So folks. We do these shows  for you. Make sure that you subscribe to  

the channel and give us an uplink. Give  us an upvote to let us know that you’re  

out there. We’ve had a big spike up in that  lately, and we’ve had a ton more subscribers  

joining the channel. And so we’re super  excited to have all you new folks here.

Jeff Kikel: And not to mention our  folks that have been with us for  

a long time watching the show we’ve been  doing this for over a year together and,  

we’re doing these because we want to  get you this information as quickly  

as possible and give you our insights  on what’s going on. So thanks a lot.

Jeff Kikel: And we will see you  guys back here the very next time.