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Jeff Kikel: [00:00:00] Good morning audience.  Welcome to the sense of things once again,  

Ron and I on the show we’re gonna kick us off  this week with a little bit of an update on  

what happened in history. Again Ron’s got his  little piece of that. We had some kind of,  

I don’t know if I would call it shocker news  this morning from the economy side of things  

that I’m gonna cover with us, and Ron and  I are gonna have a discussion on that.

So hang on, we’ll be right back  on with you. Hey everybody,  

welcome to the show, Ron. How you doing, my

Ron Lang: friend?

Ron Lang: Good morning. I can’t believe it.  Next week is Q4. Another earnings season  

gonna come fast and furious, and I truly  believe corporate earnings is gonna set the

Jeff Kikel: stage for next year.  [00:01:00] Oh I absolutely think so.

I, we’ve had really good earnings  for this year so far. I’m interested  

to see what Q4 looks like and if any  of these companies give any kind of,  

forward guidance on what they’re gonna see  coming up. I agree. I agree. You ready? Let’s

Ron Lang: What happened in history?  Something happened in history.

Alright. There’s some interesting ones. This  for this week in history remember last week  

we had the Constitution Yep. And then the Bill of  Rights has passed in 1789. Everybody thinks again,  

it’s amazing how nobody understands history,  even if they were born in this country. 7/17/76.

That’s not when the Constitution and the Bill of  

Rights was signed. Nope. It took 12 and  13 years for all that to get done after

Jeff Kikel: to form our they still had another,  

yeah, they still had another six years after  1776 to fight out the, the revolution at that  

point. And then, [00:02:00] then Articles  of Confederation, which were a disaster.

And it’s interesting. I’m actually watching  a course now on the Federalists and it’s  

actually really intriguing. It’s, I  didn’t know as much of that as I should  

have. Yeah, I agree. I’d encourage people to  study it because you understand the mindset.  

During that time period, which was very  interesting between, oh yeah, there was a

Ron Lang: lot.

You think we argue now

Jeff Kikel: it was better. Oh  my God. Yeah. They hated each  

other. They really hated, it’s amazing how they

Ron Lang: got anything done,  if you really think about it.

Jeff Kikel: Yeah, it honestly is, and everybody  seems to think that the Federalists won everything  

and the anti-Federalists didn’t, but we  wouldn’t have a bill of rights without  

the anti-Federalists really putting  their feet down in a lot of instances.

So it, it is an interest. That the American  experience and the American experiment is is very  

intriguing and interesting. You really need to  look back in history to, to see what it is. Agree.

Ron Lang: Alright. I thought this was interesting,  huh? 1846 Planet Neptune is discovered and  

I thought about it I knew they had, they  [00:03:00] called ’em spy glasses or telescopes.

Yeah. But how did they have anything  sophisticated? Almost 200 years ago  

that could look that far out. And here we got  the Hubble telescope to look into another,  

solar system. It’s just crazy. Yeah.

Jeff Kikel: But yeah, it was and nothing was  that big. I don’t know when the really first  

really big telescopes were created, but it had to  have been, I would assume in that time horizon.

Ron Lang: I, I, yeah, but I  just thought it was interesting,  

yeah, how did they discover it? But anyway, yeah,  Billy, the kid was arrested for the first time.

Not of major historical significance, a fun fact.

Jeff Kikel: Hey, first time.

Ron Lang: Theater. I thought this  was interesting. Theodore Roosevelt,  

proclaims Devil’s Tower in Wyoming,  the country’s first national monument.

I was not aware that was the first one.  We’d already been a country for 130,  

140 years. And he was very big with  national parks and protecting land and  

it was amazing in that way. But how about  that? [00:04:00] Of all things. Devil’s  

Tower is the country’s first national  monument. Thought it was interesting.

Yeah,

Jeff Kikel: I watched Kevin Costner’s  series that he did on Yellowstone and  

then on Yosemite. And that was really interesting  about Theodore Roosevelt and how that all became,  

it was pretty impressive that, literally  he just decided to go out there and,  

i’ve got, I’m trying to think of  what his name is the naturalist.

Dang it. I can’t think of what his name is. But

Ron Lang: you’re not talking about Ansel Adams?

Jeff Kikel: No. Not Ansel Adams. No. What  the heck was his name? Now I it, but the

Ron Lang: interesting thing about this  was. Even though we started a Western  

expansion in the mid 18 hundreds,  he was an explorer. A lot of people.

Yeah. He’s got a pretty amazing history. And the  

fact that he wanted to protect a  lot of this is very interesting.

Jeff Kikel: But yeah, it was  really interesting that series,  

if you can catch it, that Kevin Costner did,  it was really intriguing because he basically,  

Kevin went to Yosemite and he went to  all the places that that.[00:05:00]

The Roosevelt went to and basically  the guy that he was out there with,  

and once again, it’ll come to me, but the  guy that he was out there with was like,  

Hey, Mr. President, I want you to come and  see this whole area. And nobody had really  

explored Yosemite except for him. And so he  took Theodore Roosevelt out there for four days.

And it was. Like massive snow storms.  And it was just crazy during this whole  

time period. And Teddy was just, man,  he was in his element the whole time,  

but he left that park with such  a vigor to come out and say, Hey,  

we’re, we need to preserve this stuff. We cannot  let it get destroyed. We have to preserve it.

And absolutely. I think that’s the  story more than anything of. He was  

such an intriguing president from  that perspective of just saying,  

Hey, we, we just have to preserve our natural  resources. We can’t just let this stuff go away.

Ron Lang: No, I agree. 1928 first company  to mass produce car radios as incorporated.

Okay. It [00:06:00] was Galvin Manufacturing Corp.  

And Galvin actually later produced the motor  Motorola radio. So if you think about it,  

like it’s so ubiquitous, right?  Oh duh. Car radio. But here it is,  

1928. It wasn’t until 28. You have years, 15 years  after the car really went into mass production.

Yeah. Let’s put in a car radio.

Jeff Kikel: Cool, actually. I agree. I  guess before that you had wide open cars,  

so it really didn’t make a whole that a

Ron Lang: lot of sense. And  I don’t know about how much  

this helped or hurt. Yeah. But 1933  standard oil Rockefeller’s company,  

the geologist arrive in Saudi Arabia to  basically take him out of the stone age.

Yeah. 1948 Honda Motor Companies  Incorporated. Last week we talked  

about General Motors being incorporated. Yep.  And if you notice, this is right after the war.

And their whole rebuilding and industrial  

infrastructure build out  pretty [00:07:00] amazing.

Jeff Kikel: And 19 and some of 19

Ron Lang: four, the Warren Commissioner  report delivered to President Johnson,  

which has been picked apart  and debated for over 60 years.

We released all the other data and really there’s  nothing new and of course, very important. 1968,  

the Brady Bunch premiered on tv. Actually,  that’s way earlier than I thought today.  

Say what? The reruns are still going today.  Oh, I know. Yeah. It is the corniest crap  

you’ll ever watch. But So Gilligan  Island, same creator Sherwood Schwartz.

But for whatever reason that  has captivated more people than  

obviously the Partridge family. Which was  created to compete with the Brady Bunch.

Jeff Kikel: Yeah, but honestly,  I didn’t realize that,  

that it was that early in 68.  I thought it was actually more

Ron Lang: than Oh yeah. It  went from, I think 68 to 74.

They were on for five seasons, six

Jeff Kikel: season. Okay. And  then of course they had to have  

the couple of movies and, or like tv  Oh, stuff like that, that were awful.

Ron Lang: And then in 75 for  all you [00:08:00] favorites,  

the Rocky Horror Picture Show debuts in us. S  50 years ago. And who had a cameo role in that?

Jeff Kikel: Oh God.

So many people had cameo  roles. You recently died a

Ron Lang: few years ago.

He played, trying to remember.  Played Diddy. Oh meatloaf. Yeah.  

That is correct. Yep. Here we go. And that  is this week in history. I sound like bell  

blank for this week in baseball back in  the day. All right. I thought this was,  

I got a couple of fun things from  our, my friends at Visual capitalist.

Here’s the American population breakdown. Okay?  I don’t know about you, but I got a few clients  

in their nineties. Yep. Going fairly strong  but I thought this was interesting. I really  

expected there to be more population. In the 51  to 80 range because of the baby boomers, right?

Early Gen X, like you and I  and baby boomers, but I think  

it’s a, there’s a pretty interesting  swath there in 21 to [00:09:00] 40.

Jeff Kikel: Yeah. There, they’re ba Yeah. 21  to 40 is the next baby boom, basically. That,  

that’s what I don’t think people realize.  Is they’re the next baby boom. It was,  

it’s that millennial generation and early  Gen Z that is one of the largest generations  

that we’ve ever seen. So when people poo p the  millennials and say they’re, they don’t have a  

whole lot of effect on the world. They’re  gonna have a lot of effect on the world.

So we need to understand how, how they move  through life. Just like the baby boomers did.  

You know the baby boomers were a massive swath  that changed everything, and you really need to  

watch what they’re interested in, because it’s  gonna have an effect on us in the long run.

Ron Lang: Here’s a good stat that they brought up.

Up until the age of 40 men outnumber women,  okay? After the age of 46, women outnumber men.

Jeff Kikel: Okay? So we’re like guys  dying to know off the signs behind  

that. So [00:10:00] guys are dying off in  their fifties, so I dunno how excited I  

am about that. They can, they can’t take the  dating scene anymore. I guess so, but yeah.

Or they’re all alone. They’ve  gotten divorced and they’re all  

alone and they’re dying off. But  yeah, I, that, that’s just weird.

Ron Lang: Yeah. So here’s the breakout of our  deficit. Everybody. And now, look, I was talking,  

I talk about this every week. We just breached  37 trillion, yep. And. Our debt, the interest  

that we’re paying a loan is larger than our  military budget. We’ve talked about this before.

Literally the interest is going, we’re  paying our interest towards something that  

adds nothing to our economy. Yep. And here’s  the breakout of all that. And I think it’s  

pretty interesting as far as what, what’s  coming in and what’s going out. And what,  

when you look at this, and  this is a rhetorical question.

What do you cut out? Yeah. Social security,  there’s a lot of social security being doled  

out to people that aren’t retirees.  [00:11:00] Disability insurance,  

other things also to, by the  way non-American citizens,  

that’s another story. But if you just look  down here, all these things are important.

Yeah. So what do you, what do we cut?

Jeff Kikel: Yeah and here’s the problem I have  with all of this. So you collected taxes and  

you still continue to collect taxes. What  they’re not showing on the left hand side,  

so they’re saying individual income taxes  are what, 2.4 trillion? Where is the,  

where’s the sleeve for how much they’re  collecting from Social Security taxes?

From all of us.

Ron Lang: There is no sleeve on the

Jeff Kikel: left hand side. I  guess payroll taxes, it’s in Yeah,

Ron Lang: payroll taxes. Because as business  owners you’re paying federal. Yeah. And state tax,  

and probably part of that is the social  security, but I think that might be part  

of individual income because it’s coming  out of that part of the pie, I believe.

I don’t know.

Jeff Kikel: Yeah. Once again, [00:12:00] had this  been managed correctly instead of the government  

rating social securities. Basically using the  money and social security to generate, to,  

to pour out to other or other spending  if it had just been wisely invested,  

instead of invested in basically  treasury bonds over the years.

We wouldn’t be paying out more than we’re,  

or we could afford to pay out more than we’re  taking in because. It would’ve grown to enough,  

but they kept rating it and rating it over  the years and using it for other purposes.  

And so yeah. Now you’re seeing it as an expense  because yeah, you didn’t do anything with it.

You just kept

Ron Lang: but I thought corporation taxes would’ve  been higher. Yeah. But it’s not that’s where,  

you talk about business expansion,  all this other stuff. Yeah. We got all  

these incentives next year to r and d and buy  equipment that we can write off and whatever.

Yeah. I don’t know. Should we be taxed  more or if you’re above a certain level,  

the amount of [00:13:00] employees, should we  be paying more? This is at the federal level,  

not the state level. ’cause the state has  their own incentives, but, correct. I don’t  

know. I just think it’s gotta change and we’ve  been safe to say that, once again I look at

Jeff Kikel: it from the point of view.

Does the corporations need to pay tax or are  they creating jobs that are gonna bump up the  

top thing that’s in there where personal  income taxes are gonna get higher, will be  

a higher portion of that. Which, quite frankly,  that’s what I would prefer. It’s okay, why text?

Why tax the people that are trying to  create all this crap when we could,  

alright. We’re, it’s more of, again Yeah.

Ron Lang: Part the left side  either has to get bigger

Jeff Kikel: Yep.

Ron Lang: Or the right side has to get smaller  or preferably a combination of the two.

Jeff Kikel: Yeah.

Ron Lang: And I’m trying  to figure out matter, yeah.

I’m trying to figure out what the matter’s gotta  get reelected. Typically they’re not gonna touch

Jeff Kikel: the left. No, and they’re  not gonna touch the right either,  

which is the other challenge. I what  I’m trying to figure out is the income  

security [00:14:00] side, I guess  it’s the, HUD and things like that.

And, I know here in Austin there was  a whole big crowd of people out in  

front of our senators office  here in Austin yelling about,  

hud and you know what, so anything  you cut from government spending,  

no matter what it is. Somebody’s gonna complain  about it and we’re Yeah. Have to deal with it.

Yeah. I don’t know what the solution  is. It, the solution is definitely not,  

we gotta tax people more because all that does is  just reduces the taxes that come in. Yeah, I hear

Ron Lang: you. All right. Yeah. So  onto the math portion of our program,  

so I thought this was interesting. This was  margin estimates for 2025 versus 2026, and.

I looking at this, right? Tech is continuing  being a big winner. Healthcare, still,  

I think healthcare is gonna do very well through  next year and I’m really referring more to  

biotech than the general healthcare. But ’cause  healthcare has, the sector has not done well,  

but biotech has [00:15:00] done pretty good,  especially in the last seven months, but.

I just think when we’re looking at margin  expansion year versus sales growth not  

healthy for this year, but next year looks  super good. Not sure what your thoughts are.  

I like this. Why, because the next slide is gonna  dovetail to give us a little history behind this.

Jeff Kikel: Yeah, it’s interesting  on real estate margin expansion.

Wow. That’s, that’s off the charts down

Ron Lang: and a lot that has  to do with mortgage rates,  

which aren’t gonna go down a lot in  the next couple of years unless the  

30 year comes down under 4% and people  are talking about an edging towards five.

Jeff Kikel: Yeah. But it’s interesting  to see how how margins improve next year.

And I think with real estate, the good  part about it is, depending on the type  

of real estate there’s a lot of great tax  incentives that I think are gonna help on  

the margin side especially on the real  estate piece of it. If you’re building,

Ron Lang: New home

Jeff Kikel: sales

Ron Lang: is good, it’s existing  sales that isn’t judging.

Yeah.

Jeff Kikel: But I think also in the  corp, more in the commercial side of  

it [00:16:00] there’s a lot of opportunity  within the new rules around this, depending  

on what you’re building, if you’re building,  manufacturing plants and stuff like that.

Ron Lang: Gotcha. So now let’s look since 1970  because back in the day, really prior to 1980,  

definitely 1990, but 1980, everything was slow and  steady and let’s, if we hit double digit growth,  

like that was a bumper year. And a lot of people  don’t remember this. I remember. ’cause I was on  

the tail end of it, like dividend yields.  We’re six to 10% on a lot of companies to  

get them attractive for people to buy in  it because they were just growing slowly.

So how do we get people to buy  our stock? Let’s give them a  

good dividend. Sure. Today. I’m not  gonna say it’s an opposite thinking,  

but they, everybody is just growing to  the point where we don’t need to give as  

much of a dividend, right? So what the average  dividend is under 3%? Under three point a half?

Yeah.

Jeff Kikel: It’s two. Yes. [00:17:00] 0.1%. So

Ron Lang: let’s look at this. So we could  see here that with margin expansion,  

right? Meaning profit margin expansion, right?  We don’t need to give out as much in dividends  

because. You’re gonna get it In capital growth on  stock prices. Sure. As far as where we’re going,  

and there’s always, as we could see,  an ebb and a flow to margin expansion.

Either we get overheated, then we get a sell  off, and then we get to a trough to a point  

where things are super cheap. Hey, let’s get in.  And, so there’s an ebb and a flow to it, but my  

god yeah. If you just take a look here, can this  continue to go up the way it is? I don’t know.

Jeff Kikel: Yeah, as long as  companies are profitable and,  

honestly I think there’s margin expansion.

If you were to ask me personally, I believe margin  expansion is gonna continue to go up significantly  

because I don’t, right now companies are  spending a massive amount of money out of their  

margin [00:18:00] into ai. They’re, investing in  a lot in the AI side. That’s all gonna come to  

fruition at some point where it’s, it’s gonna,  a AI is gonna expand throughout industries.

I, I put this akin to the expansion of  the internet. When I got into the mar,  

when I got into the, this business in 95  it was, we were just at the beginning of  

really seeing what. Productivity, it was  enhanced by the internet and everything  

else. And I think we’re at that, we’re  at that inflection point again of, yes,  

people are spending a lot of money on the  on ai, but it’s gonna come to fruition.

And you’re starting to see it  roll out into a lot of companies  

now. It means that it’s gonna mess with a lot  of jobs, but. I think people that get trained  

in AI and learning how to implement  it, it’s a massive tool that can be  

used by a lot of companies and I think  it is gonna continue to expand margins.

Ron Lang: Yeah, [00:19:00] I, like I said,  

everybody gets intrigued by the earnings and  by the way, this is probably a separate show,  

I understand why you might want  to go to biannual reporting.

But I still think you gotta release something  on a quarterly basis. Yeah. Maybe you release  

your financials on a quarterly basis, but you  don’t give necessarily guidance every quarter.

Because that’s tough enough. I don’t know how the  hell people go, yeah, we’re gonna be at this EPS  

in five months. You don’t know what the hell’s  coming in next week. Yeah. I never, yeah. And  

everything’s moving so rapidly. Financials every  quarter, and you give guidance, twice a year.

Yeah, you’d be okay with that? Yeah.

Jeff Kikel: And don’t do these big dog and  pony shows every, every quarter. Good lord,  

they spend half their time prepping for the  next quarter with a lot of this stuff. Yeah  

I would be fine with that. Just have a short  little, Hey, here’s what our financials were.

We can answer some questions on this.  We’ll, next quarter will be our. Biannual,  

where we do more of a dog and pony show to  let you know what’s going on [00:20:00] and

Ron Lang: Yeah. No, I hear you. It’ll  be interesting going into Q4 here doing  

earnings absolutely. Yeah, no, we’re  good. And yeah, until next time, my man.

Jeff Kikel: Brilliant. Alright folks, as always,  make sure you are. Subscribing to the channel.  

Love comments from you, but make sure you  subscribe to the channel because we put a  

lot of these shows out. So thanks a lot and we  will see you guys back here the very next time.