March 28th, 2026 - Correction Territory

Steve and Adam Van Wie, along with Joey Loss, explore recent market turbulence influenced by geopolitical tensions and corporate news. They humorously debate topics like speculative trading for teens, wealthy taxes, and the limitations of financial journalism. Highlighting both market pros and cons, the hosts emphasize long-term investing while unraveling a costly corporate blunder with a touch of irony.

Transcript

Steven H Van Wie 0:00

It's Saturday morning, it's 10 o'clock. This is the Van Wie Financial Hour. I'm Steve Van Wie.

Adam Van Wie 0:06

I'm Adam Van Wie.

Joey Loss 0:07

And I'm Joey Loss

Steven H Van Wie 0:08

Gang's all here. Once again, Joey sounded a little bit soft. You might want to turn that up just a little. But the Adam has come back, tanned, rested and ready to roll. Did a miserable job with the market while he was gone.

Adam Van Wie 0:23

I really did, but I. I was actually leaving it up to you guys and I think you failed.

Joey Loss 0:27

Oh, man.

Steven H Van Wie 0:29

There's something like passing the buck.

Adam Van Wie 0:33

I mean, I wasn't at work, so.

Steven H Van Wie 0:34

Yeah, you're the first one to say that you do your best work when you're away. You know, there's a fine line between delegating responsibility and passing the buck.

Joey Loss 0:43

I don't know. You were there Thursday and Friday.

Adam Van Wie 0:45

Yeah.

Joey Loss 0:47

This a rough end of the week.

Steven H Van Wie 0:49

I'll let the guys get into that in a minute. First off, I want to welcome all the regulars. As long as you're listening, we're talking and you're always there. We just keep coming back. We're solidly into year number 12 for the show right now. Wherever time goes, if you find it, let me know because I don't know. But if you're new to the show, you found it by accident or somebody told you or whatever, try to stick around for the hour. We'll virtually guarantee that you'll pick up something that might be useful, but at least it'll be something you didn't know. And of course, we will have a trivia question and all the. All the usual stuff that you're accustomed to after all the years on the show. So I like to put off any discussion of the market when it's bad, but I think the best way is just to dive right into it. This is not about our economy. It's not about anything except urban. And you have seen it. When there's a piece of news that comes out, boom, market goes up. And then when there's a not so good piece of news, boom, it goes down. If you're trying to time that, I pity you.

Adam Van Wie 2:02

Yeah, it's not going to work. And you're right. I also looked at everything and drew the same conclusion. It's just 100% about Iran right now. And until we see some definitive resolution, the market's going to continue to be in a bad mood. Both the. Now, both the Dow and the NASDAQ entered correction territory this week with the Nasdaq having fallen 10 of the last 11 weeks. This has only happened four other times, if you can believe that, that's pretty crazy. And the drop of 11.8% from its 52 week high makes this by far the shallowest drop of those now five occurrences. However, three months out, the index has been higher a hundred percent of the time when this happens for an average gain of 7.3%.

Steven H Van Wie 2:51

That's almost always.

Adam Van Wie 2:53

Almost always, yeah. And a year out it was higher 75% of the time. So three out of those four occurrences for an average gain of 20.5%. So while it doesn't feel very good, we know that these types of things are normal. And the market had been doing nothing but go up since last April and it needed a reason to correct and boom, we got one and here we are. But honestly, this is healthy. It's, it's not a bad thing. It feels bad obviously, but it is not a bad thing overall because you need, you can't have valuations go up when PEs are sitting at 23, 24 time. And it just. Nothing looks attractive when you can't average

Steven H Van Wie 3:35

one correction a year unless you occasionally get a correction. That's another piece of advanced math that only someone with a college degree.

Adam Van Wie 3:39

That's also true.

Adam Van Wie 3:44

It's kind of like your favorite saying about those things that are unsustainable will stop.

Steven H Van Wie 3:50

Yeah.

Adam Van Wie 3:52

Some of this rebound that you're seeing in the data with the NASDAQ is just a reversion to the mean. Once you hit extreme oversold territory, the odds are that it's not going to stay there. It's going to go back to at least neutral. So you're gonna see a bit of a bounce. And just overall, I think this market is starting to look a lot more attractive than it did because of the fundamentals haven't really changed. The only thing that's changed is the pricing and what people are willing to pay for those stocks in the index.

Adam Van Wie 4:24

The S and P hasn't entered correction territory yet. It is actually down, down right now about just over 9%. So we're really close. And that is off of its high set on February 10th of just over 7,000.

Adam Van Wie 4:41

It is. It did cross over its 200 day moving average to the downside for the first time in 214 days though. So not a, not a correction, but an interesting chart pattern. Historically, when the S P has been above the its 200 day moving average for more than 200 days, it has traded higher three months later, 89% of the time. So again, almost all the time for an average gain of 1.66%. So not nearly as good as the Nasdaq, but still a gain. And I would not be surprised if we do see the S P hit correction territory before we see that happen. But it's all going to depend on what happens with Iran and what the news cycle looks like by Monday morning. So if we, by Monday morning have some sort of resolution, we may not see correction territory. If we don't have a resolution, I would be surprised if we didn't see correction territory.

Adam Van Wie 5:36

The market did have a couple of good days this week and it also had a few really bad days. However, the buyers are out there and I think that's pretty clear based on what happened on. I think it was. Was it Monday or Tuesday that we got the truth social post about negotiations and with Iran and you saw the market immediately spike. Futures went from, I think, slightly negative to like 800 points positive, something like that. So the buyers are sitting out there ready to go, but they're not going to do anything until we see a shift in the sentiment towards the war.

Steven H Van Wie 6:11

Yeah, they, Iran wanted a week. Trump gave them 10 days. It was great news for everybody until they thought about it overnight.

Adam Van Wie 6:18

Yeah, and, and that makes sense because it's not actual progress, it's just, it's like the, the hint of potential progress. You need to see real progress. We need to see some framework of a deal. We need to see Iran, whoever is in charge there. And I think that is one of the major problems, is that they've lost all of their leadership. So who are they even negotiating with is a big question. You need to see them publicly say, yes, we have cut a deal. Here are the basic term, something like that. The dow was down 0.9% this week. The S&P was down 2.1 and the Nasdaq down 3.2. Year to date, all three indexes are down over 6% with the Nasdaq leading the way, down at 9.9%. That's for the year off of its high, which was set actually last November, November 29, it's down almost 13%.

Adam Van Wie 7:10

Now, there is good news out there, so don't think that there isn't. For one, corporate profits remain very strong and growing stronger, with margins also growing stronger and topping 13%, which is historically much higher than the average. So if you look back at the, the average profit margin of the S P500, it's actually closer to 12, but post Covid, it's been pushed up to 13. Now part of that has been the explosion of Nvidia, who has margins much higher than 13% and they're enormous. So I think that is bringing that average up. But it is interesting to see margins growing like that. Another positive is that semiconductors, which are somewhat considered the transports of this century, are outperforming the S P despite Nvidia not performing very well. Additionally, the drop in stocks has brought the PE ratio, which I mentioned earlier, of the S p from over 23 back down in the teens. For the tech sector, that ratio has declined from over 30 down to 20, which is a huge drop. Jobless claims remain very low. Productivity has been increasing and investor sentiment is bearish. When we come back from the break, I want to talk about the cons out there, the negatives, and there's a few and they're, they're legitimate, but you can decide if they outweigh the pros that I just mentioned.

Steven H Van Wie 8:31

All right. And we will have a trivia question as usual. And I will apologize to everybody right now for forgetting to give you the answer. Last week, the new million billionaires last year across the world were 400. And there's quite a lot of them here. I will be right back. Don't go anywhere. This is the Van Wie Financial Hour. 

Steven H Van Wie 8:53

Welcome back to the Van Wie Financial Hour. I'm Steve Van Wie.

Adam Van Wie 8:55

I'm Adam Van Wie.

Joey Loss 8:56

And I'm Joey Loss.

Steven H Van Wie 8:57

And we do have a trivia question. I wanted to give a couple more little spots on

Steven H Van Wie 9:04

the question. Last year, last week, for those of you who didn't hear it, how many new billionaires were created last year across the world? That answer was 400. There are now a total of 3,428

Steven H Van Wie 9:18

billionaires in the world. 989 are in the U.S. and of those, 88 are in Texas. And Florida is picking up their numbers pretty quickly as people move. We're going to be talking a lot about that today. We have lines open 904-222-8255.

Steven H Van Wie 9:39

And today's question kind of making a last minute decision on which one to do.

Steven H Van Wie 9:47

Let's go with the stupidity 1. Today, ten years ago, Morgan Stanley had a big pile of hard drives and servers that had been replaced. And of course, they had Morgan Stanley's client information all over them. So they were highly sensitive. So there was a guy who was charged with getting rid of them the right way, of course. And if you read the specs on getting rid of something like that, we're talking about small little pieces where drives used to be. But he found a way to save $100,000 by hiring an inexperienced moving team with zero data security experience that came back and bit Morgan Stanley by how much? What did they wind up paying for saving? $100,000. And you're going to love it, at least if you're like us. Anyway, the, the wrap up on this past week, even though it's a topic we'd all like to get rid of, it's important to look at the negative side because we tend to open up with a bit being a bit more positive.

Adam Van Wie 10:55

I think, Yeah, I do think we need to look at the negative as well because there are a lot of negative sentiments out there right now. Obviously if you've watched the market at all, you would know that.

Adam Van Wie 11:08

So the charts are a mess. It's been a series of lower lows and lower highs being made and that's never a good sign. That just means that every attempt that when, when bears step in is just shot down or yeah, when bulls step in is shot down by the bears. So that's not it. That's not the type of chart pattern that you want to see. We haven't seen a death cross on the S and P yet. But as the 50 day moving average trends lower and the 200 day has been basically flattening out, it's a real possibility that we could. And that's, that's a very negative chart pattern. Part of the problem is that every mega cap stock has an ugly chart right Now. So the Mag 7 have such a huge weighting on the index, all of the indexes, and without those turning around, it's going to be really tough for the whole market to turn around. It can happen. We had, we did see a period earlier this year where those, those stocks are not performing well, but the rest of the market was. But when things turn negative like this without, without those seven stocks helping out, it's going to be tough to turn around. The worst news out there right now, I think, is that oil prices are high, interest rates are rising and that the dollar is strengthening. When those three things are happening in unison, you're not going to see a pretty stock market. So we need the war, the war to end and oil prices to continue come back down. And I think all of those things would turn around fairly quickly. And then lastly right now another headwind is that the war and the rise in oil prices has left the market sort of contemplating are we done with rate cuts and even are we looking at rate hikes going forward? And that would be disastrous.

Steven H Van Wie 12:51

Yeah. And if only the Fed would sit back and think about it which may be attributing too much sanity to them. The current little spate of inflation is not something they can control, period. No, it is 100% about the price of oil. And you could see oil go from 100 to 70 easily in a week, maybe even in a couple of days.

Adam Van Wie 13:15

I mean, we weren't that far away from that on Monday, I think.

Joey Loss 13:18

Yeah. We were back below 100 in the States.

Adam Van Wie 13:20

Yeah.

Steven H Van Wie 13:21

Yeah. And that is not controllable by the Fed. And if the Fed makes a reaction to something that they have no control over, it's going to work to the detriment of the country. And I fear with the current crop of idiots in there, that that's a possibility.

Joey Loss 13:38

Well, we don't need to look any further than what the EU central bank did after Covid. Way exacerbated what was already, you know, inevitably going to happen. Big mistake.

Steven H Van Wie 13:42

And they're not alone.

Steven H Van Wie 13:49

Central banks are never going to change. I am absolutely convinced. They never should be in existence and they never will change. It's just something that we as investors have to put up with. That's the way I see it.

Adam Van Wie 14:03

Yeah. We have to navigate it, but it is, it carries outsized weight on the fate of the stock market and therefore the fate of your portfolio.

Steven H Van Wie 14:14

Any other cons?

Adam Van Wie 14:15

Nope, that was it. I mean, I think it's about even between pros and cons right now. I feel like this market could turn on a dime and I'm pretty convinced of that. But the big question is, are we going to see that truth social that ends the war and is it real and what happened, like when that happens, you could see this thing turn around so fast.

Steven H Van Wie 14:38

There's one more little interesting thing out there. Crypto has gone from point A to the peak, back to point A price wise. And all I can think of when I read about things like that is

Adam Van Wie 14:48

Yep.

Adam Van Wie 14:53

so what I, I fail to see the relevance of that in anything. I mean, I think it's, I think what crypto is, is kind of a good measure of how much free cash flow young people have a lot to I really don't know what else it's good for measuring.

Steven H Van Wie 15:07

be said for that line. I mean, I believe.

Steven H Van Wie 15:12

No, I don't either.

Joey Loss 15:13

I think it's a, it's kind of a thermometer for momentum in the market. Like when we see growth stocks starting to swing hard and, and this, I mean, it's pretty related to free cash flow. So it's not, it's not totally independent of that. But I Think it's a good thermometer for momentum. Like when crypto starts to slow down and reverse, people are a little less eager to throw things at speculative.

Adam Van Wie 15:34

Yeah, I guess it is the, the ultimate risk asset. Yeah. You really have to be in a pro risk asset market for crypto to go to 100 or Bitcoin to go to a hundred thousand.

Joey Loss 15:36

So for sure.

Steven H Van Wie 15:45

Yeah, I have to agree because it

Joey Loss 15:48

clearly doesn't act like a, you know, it doesn't do the same thing as gold when people are concerned.

Adam Van Wie 15:54

No, but sometimes gold doesn't do what gold should when people are concerned.

Joey Loss 15:57

Exactly. And we see bitcoin do it. So sometimes it's a growth stock, sometimes it's a right commodity, sometimes you can

Steven H Van Wie 16:03

talk to gold all day long, but you, you can't make it listen.

Adam Van Wie 16:06

No, it's sold as one thing and it acts totally different sometimes.

Steven H Van Wie 16:11

Yeah, absolutely.

Joey Loss 16:12

Adam, you mentioned that you feel excited about, or at least you see a lot of good in the market. And I feel like this, I'm kind of excited just because I'm a long term investor. I look at the current and a lot of the narratives that people are concerned about. I mean, how many times was the AI bubble thing thrown out last year?

Adam Van Wie 16:30

Yeah. And are you hearing about that now? No, me neither.

Joey Loss 16:32

I haven't heard the words in a while. And I didn't think there was one to begin with. But to have a moment like this where the biggest players are just kind of inexplicably stalling. I mean, they're spending a lot of money. Yes. That used to be free cash flow. Yes. But the second they decide to stop spending that free cash flow is free cash flow again. The contraction we've seen in the multiples for these giant companies just doesn't really resonate with me. So you got Microsoft trading it 33% less of a cost than it was not that long ago. And the company hasn't materially changed.

Adam Van Wie 17:04

Yeah.

Adam Van Wie 17:06

And I'll tell this story. I called you yesterday and was like, hey, our 401k deposits went in today. How great is that?

Steven H Van Wie 17:12

Yeah, Yeah, I love it.

Joey Loss 17:14

So I think, I think, you know, if you're, if you're a short term investor, this probably feels pretty bad. But if you're a long term investor, this is a big opportunity. And we do have a handful of clients who every time the market's down, you know, 3 or 4%, they're like, hey, I've got an extra thousand bucks. Where can I put it? And it seems like nothing right. Like $1,000 on a retirement journey. But they do it all the time. They just have this habit of buying the dip.

Adam Van Wie 17:29

Oh, definitely.

Adam Van Wie 17:34

Yeah.

Steven H Van Wie 17:36

You're buying 13 or $1400 worth of stock. It's a pretty good deal.

Joey Loss 17:40

Yeah.

Adam Van Wie 17:41

At a 30% sale. Yeah, that's a good deal.

Joey Loss 17:43

It makes a difference. And I should have worn my bespoke by the dip shirt. I have one. Today was a good day for it.

Steven H Van Wie 17:50

Yeah. That's a lesson Adam learned a long, long time ago. When things were scary out there. And it was just like Warren Buffett said, buy when there's blood in the streets.

Adam Van Wie 17:53

Sure did.

Joey Loss 17:56

Yeah.

Adam Van Wie 18:00

No doubt about it.

Joey Loss 18:01

Yeah.

Steven H Van Wie 18:02

Okay, point of discussion here. And it is relative to what Joey was talking about. Schwab has just launched what they call a teen investment account.

Adam Van Wie 18:12

Okay.

Steven H Van Wie 18:16

What you can do in the teen investment account, among other things, is buy fractional shares and things like that. I want to know if this scares anybody but me. And my reasoning is very simple.

Steven H Van Wie 18:34

A kid who believes because of his early experience in life that the term investing means stock picking and buying and selling fractional shares will grow up that way. I think. And to me, there's a very, very big difference between an investor and a speculator. I think this is going to create a nation of speculators

Steven H Van Wie 19:01

open for discussion.

Adam Van Wie 19:03

No, I think the exposure at a young age is actually a positive. I think that the more we can introduce young people to building tools that can help them build wealth throughout their lives, that buying a house. Yes. Is a great way to build wealth, but it is not the only way to build wealth. Long term investing and putting money in the market has been probably even better for the people that have participated in it than buying a house.

Steven H Van Wie 19:31

Well, we know historically that's true.

Adam Van Wie 19:33

Yeah. So I think it's good. I think it's just more exposure. I mean, my kids both have UTMA accounts. I try and get them involved in picking what assets they want to hold. I obviously coach them not to trade and not to sell unless there's a good reason to do so. And so I just, I'm a big proponent of teaching young people about the mechanics of the market, how it can work in your favor, and why it's so important to invest early.

Steven H Van Wie 20:00

And often your kids are very fortunate that they have a built in governor on their account.

Adam Van Wie 20:05

Yeah, it's true. But I just think getting more kids exposure to this is a positive.

Joey Loss 20:10

Yeah, I agree. And you know, just a share of spy, which is probably the biggest ETF in the world. Is $634. So to have the capacity to buy fractional shares, I don't, I don't think that necessarily drives people to individual stocks.

Adam Van Wie 20:16

Yeah.

Steven H Van Wie 20:24

And. And the other strong positive for this concept is zero trading cost. And when, when Schwab set out to start his company and so on, his dream was to have zero trading costs. He made it during his lifetime. Don't go anywhere. We'll be right back. This is the Van Wie Financial Hour. 

Steven H Van Wie 20:45

Welcome back to the Van Wie Financial Hour. I'm Steve Van Wie.

Adam Van Wie 20:47

I'm Adam Van Wie.

Joey Loss 20:48

And I'm Joey Loss.

Steven H Van Wie 20:49

And I remind everybody again that lines are open 904-222-8255.

Steven H Van Wie 20:54

Where you can take a shot at our trivia question. Morgan Stanley once got rid of a whole pile of information on hard drives and servers. And it was sensitive stuff about their clients, of course. So they assigned a guy to destroy it the right way. And he decided he was going to save the company $100,000 by subletting the job out to a moving company that had no experience in that sort of thing. Well, it didn't work out well, which I will explain later. But what did it ultimately cost Morgan Stanley to save $100,000?

Steven H Van Wie 21:33

And I'm going to give you a hint. It's more than $100,000. I figured you might figure that. All right, here we go.

Adam Van Wie 21:37

I figured.

Steven H Van Wie 21:45

I can't resist doing some of the stupid things.

Adam Van Wie 21:47

Well, hold on one second. Can we go back? If Schwab can give Teen accounts the ability to trade fractional shares, why can't they do it for me? Really bothers.

Joey Loss 21:55

Yeah, that was my.

Steven H Van Wie 21:56

I thought they did for everybody.

Joey Loss 21:58

They're very strict about it. So for, for example, if you're transferring money from another custodian and you have. Even if you bought them with like reinvested dividends, which they'll do. Reinvested dividends so you can hold fractional shares.

Adam Van Wie 22:00

Yeah.

Adam Van Wie 22:10

Yes.

Steven H Van Wie 22:10

You can't purchase because of dividend reinvestment.

Joey Loss 22:12

Right.

Adam Van Wie 22:12

Yeah, but. Yeah, and then when you transfer it over, they actually make you sell the fraction of. Yeah, yeah. And transfer over the whole lots. Even though they can hold them. It makes no sense.

Joey Loss 22:23

Which isn't a huge deal tax wise. But it's like, why do I have to have this cash on the sideline already?

Steven H Van Wie 22:27

You want to do an over under on what month? That's going to change.

Adam Van Wie 22:32

It's got to change. It's so stupid.

Joey Loss 22:34

It's going to be. Well, competitors that are getting bigger names, they're doing it.

Adam Van Wie 22:37

That's right.

Steven H Van Wie 22:37

They're going to do one old boardroom theory. And I think there's more to it than theory is. While they love the high stock price, they know that it starts cutting people out. Potential investors are cut out when it gets too high. So you go to $1,000 stock and not everybody's going to be able to buy it. So there'd been a lot of splits. I remember Apple, Apple did 7 for 1 and others were getting a little buzzing in the line there. Good morning, Marshall.

Adam Van Wie 22:52

Yeah.

Adam Van Wie 23:09

That's better.

Marshall 23:13

Gentlemen. How y' all doing?

Steven H Van Wie 23:14

Excellent. How about you?

Marshall 23:17

I want to take a shot and say $13 million,

Steven H Van Wie 23:22

That's quite a lot of money, but it's nowhere near enough.

Marshall 23:28

I had a sense that might be, but I thought, okay, well, let's set a spot.

Steven H Van Wie 23:31

You're raising the floor.

Joey Loss 23:33

Yeah.

Adam Van Wie 23:34

Yeah.

Marshall 23:35

I have a question for y'all. I just keep seeing how lying has become a standard and is not ignored. It's like assumed. So data that we hear that we take as probably factual is in fact totally fraudulent.

Steven H Van Wie 24:02

China led the way.

Steven H Van Wie 24:06

Pardon? China led the way.

Marshall 24:09

Yeah. But I think, I think our politicians many years ago started it and the advertising world took it to a new level, which now we have an all time new level of fraudulent information. And I'm wondering how bad has it gotten in the factual reporting that y' all have to depend on? And are there such things as straightforward and honest data sources for us to listen to other than you guys?

Steven H Van Wie 24:48

Boy, what a tough question.

Adam Van Wie 24:49

I think, I think in the public reporting by companies that are listed, I don't think that there's a ton of intentional fraud. I think that it is probably the exception. There are mistakes, of course, anyone, that can happen at any level level of an organization. But I feel like that the intentional fraud is probably limited to maybe a handful of companies a year. So I do think that they make an honest effort to report sales and profit numbers that are believed to be true.

Steven H Van Wie 25:27

Yeah. Indigenous in the GAP accounting system are some things that I have always considered very dubious. One of them, for instance, is let's say the accrual rate used by huge companies like General Motors for their pension plan. So if they want to show more money, they're going to tell you that they expect a return of X amount. If they want to show less money, it'll be Y amount. And I've never seen it match what they're actually receiving on their pension funds. That goes back. Heck, I was still in college, I think learning economics and want to tell you that was one long time ago. So there are things about the system itself that I think are inherently

Steven H Van Wie 26:15

less than perfect. And I also it one of you. Well, you weren't here. I think Joey was saying that there, there are some companies that look like they're going to change their quarterly report.

Joey Loss 26:27

Yeah, we can semi on that. I'll get to that in a second. But just to comment on Marshall's question. Marshall, I think it's a very valid concern. And when it comes to the data that we look for, we look for politically agnostic, just straight technical data sources and we pay good money to have that. And the one we use and rely on, we've used for a long time. And we know some other broadcasters that also depend on it. So. So we're very confident in that. And all of that is based on the public reporting of companies in the United States. And if you look at the way multiples work across the globe, the world agrees that the US Markets have more integrity than other markets, which is one of the reasons that we trade at higher multiples. It's not the only reason, but it's a big one for why we trade at higher multiples than other similar companies in other countries.

Joey Loss 27:20

And to tie it to what Steve was talking about last week, we talked a little bit about how there's a proposal at the SEC to change the reporting requirements from quarterly presently to semi annually. Now, it still looks like many big companies that see quarterly reporting as a show opportunity. So Nvidia, with these big CEOs, Tesla companies like that are still probably going to report quarterly if this passes, but semiannual reporting, the thought is that we've seen a decline in the amount of companies going public in the United States over the last decade and that maybe if we reduce the burden of reporting, we would see an increase. I'm not sure how much I believe that, but it's on the table.

Adam Van Wie 28:02

It's expensive and complicated to report quarterly. And so that would reduce some of that burden. I don't know if it will have a notable effect on the amount of public companies, but it certainly wouldn't hurt.

Joey Loss 28:05

It is.

Steven H Van Wie 28:16

You know, the real prevarication problem in this country is inside the Beltway and you can't really trust much of what comes out of Washington.

Steven H Van Wie 28:28

They, there is no penalty. They are never held to account. They can tell you whatever they want you to hear and you can't do anything about it. And let's face it, if it's truly the economy that runs the market. And it is in the long run, with little. Little bursts of something else like right now. But if. If there were a truth in packaging in Washington, D.C. a lot would change.

Adam Van Wie 28:31

That is true.

Adam Van Wie 28:55

The. The other, I think the biggest, potentially the biggest problem right now is the lack of accountability on legacy news organizations. They are. They have become pundits and they. But they sell themselves as news. But it's all opinion pieces, and there's no accountability for lying in that arena.

Joey Loss 29:14

And the truth has always been the case that you can. I mean, they're selling vibes, they're not selling data. And it's always been the case. You can go back to Vietnam, you can go back to September 11th, you can go to all these different times. And if you look at the papers, you can get two completely different stories out of one truth that exists at any given time. And that's why we just can't look. I don't think investors can look at newspapers for the sourcing of their trade ideas.

Adam Van Wie 29:20

Right.

Steven H Van Wie 29:37

And even the Wall Street Journal, Right.

Joey Loss 29:41

And like, as Adam just pointed out, there's a strong list of pros and a strong list of cons. Both are true. There's two different avenues that we could see from the market going forward. It's good to know both. But the data points are the data points. You can't just sell one side or the other. And that's what newspapers do.

Steven H Van Wie 29:57

Papers like the Economist that are so trusted by so many people. I canceled my subscription in the 1980s because it was a liberal rag. Wall Street Journal. I also canceled in the 1980s because it was a liberal rag. I don't trust any of those, which is the main reason that we subscribe to a very expensive data source that Joy was talking about. So we try to see through the obvious things, and it's sure not easy.

Adam Van Wie 30:25

Yeah, it looks like Marshall's gone. But what a great question. And it is. I think it's gotten harder and harder each year to be able to sort through everything that is highly politicized. And the things that are being politicized now are just insane. I mean, it's like you can't bring up a topic without having a left and a right opinion about that topic. It just doesn't even make any sense.

Joey Loss 30:50

Well, and again, just to drill in, like, how complicated things can be, you can have parts of the market, right? So we've talked about how young coders coming out of school are having a hard time. That is not a great market right now.

Steven H Van Wie 31:01

Years ago, it was the greatest.

Joey Loss 31:04

Conversely, if you look at the top end, like experienced coders, that job market and their wages are better than they've ever been. It's an amazing time because with AI, their output is higher. And so if you were to just cast us, you know, a comment about the coding market, you're missing the point because there's two stories going on. Yeah, but then if you zero in on those types of things and say the job market's bad. Well, I'm looking at a chart right here that says the job market's about as healthy of a baseline it's been in a while. Right.

Adam Van Wie 31:31

Uptick in jobless claims.

Joey Loss 31:32

But if I just zero in on the emotional element of a story of, you know, a particular part of the market, I might start to think we're in real trouble.

Adam Van Wie 31:40

Yeah. I mean, and you can make whatever narrative you want to make work right now because there is a data point that will support it that I look no further than this, this, this headline that I brought. Carnival cuts profit outlook as jump in fuel costs, Offsets record cruise demand. How can you have record cruise demand in an. In a economy that people think is in recession? It doesn't. It just. How can you square.

Steven H Van Wie 32:00

Does not compute.

Steven H Van Wie 32:03

Well, a lot of people would say it's the K shaped economy.

Adam Van Wie 32:07

Yeah. And I keep going back to that. I think there is a lot of truth to that.

Joey Loss 32:11

There is, but here's another chart that was in the pros section of this data report, and it says that household balance sheets look very healthy. Better than pre Covid. And so that doesn't mean there aren't Yeah, it doesn't mean there aren't people struggling.

Adam Van Wie 32:20

Yes. Yeah.

Steven H Van Wie 32:23

people struggling down too. They have more money and less debt. That's a good thing. But it's K shape. We'll get on that again in just a couple minutes. Got to take another quick break. We'll be right back. Don't go anywhere. This is the Van Wie Financial Hour. 

Steven H Van Wie 32:38

Welcome back to the Van Wie Financial Hour. I'm Steve Van Wie.

Adam Van Wie 32:40

I'm Adam Van Wie.

Joey Loss 32:41

And I'm Joey loss.

Steven H Van Wie 32:42

Lines are open. 904-222-8255.

Steven H Van Wie 32:46

When Morgan Stanley decided to save $100,000 destroying some data, and they subbed it out to save the money. One guy, I'm sure he doesn't work there anymore. What did it wind up costing Morgan Stanley? We know that 13 million is too low. All right, here's one. These are the kind of stories this tells you a lot about the state of people and journalism. A young couple living across the street from Central park on the Upper west side of Manhattan. They're making just under $500,000

Steven H Van Wie 33:24

and they're barely making ends meet. So here's what we know. They spend $4200 each month on daycare for their one year old son. Yeah. They spend $3900 in rent for their 800 square foot one bedroom apartment.

Adam Van Wie 33:35

Wow.

Adam Van Wie 33:45

That actually seems cheap to me.

Steven H Van Wie 33:48

3900. I, I don't know.

Adam Van Wie 33:50

The area, I mean. Yeah, I would have guessed three times that.

Steven H Van Wie 33:55

Well, they, they place a very high value on being able to walk places including Central Park. And they have a dog, Peabody.

Adam Van Wie 34:02

Yes.

Steven H Van Wie 34:06

It's his name. Sherman. I wonder. Anyway, like many couples, they have discussed leaving the city and they don't want to, but they're, as I said, they're barely making it. And they go through all this rigmarole, about two and a half pages worth. And they bring up these expenses. They have memberships to the Central Park Zoo at $160 a year. Whoopi, American Museum of Natural History, $180 a year. Those are the things that they bring up. They're trying to save $10,000 a month.

Adam Van Wie 34:40

Their annual $180 memberships.

Steven H Van Wie 34:43

Okay, they want 10,000amonth until they can afford to buy property, I guess. But they want to buy it right where they are. And it's going to be a lot. But you know what's missing in this little epistle? I went through everything

Steven H Van Wie 35:00

just to review. 10,000 savings, 3,900 rent, 4,200 daycare, 500 on eating out, which doesn't sound that bad.

Adam Van Wie 35:07

No, that's pretty cheap.

Joey Loss 35:08

That's impressive.

Steven H Van Wie 35:09

150 on laundry services, 370

Steven H Van Wie 35:13

on doggy daycare and grooming. That's month.

Joey Loss 35:18

That's not bad.

Steven H Van Wie 35:19

There's not one mention in this entire three page article about the taxes they have to pay.

Adam Van Wie 35:27

Pay? Yeah. That's going to be their biggest expense by far.

Steven H Van Wie 35:31

Yeah, I would think. If you're trying to make the point that it's hard to get by in New York on $500,000, you might start with the taxes.

Adam Van Wie 35:39

You, you might. Unless you had an agenda.

Steven H Van Wie 35:42

Yeah. And guess what? They do. All right, here's. Speaking of New York, there is a little subset of rich people in New York who are begging to pay more taxes.

Steven H Van Wie 36:00

Now,

Steven H Van Wie 36:02

I am not an attorney. I don't play one on the radio. But in my 75 years on this earth and I pay attention pretty well, I have not heard of a law that prevents you from paying more taxes. I think the law says the minimum you owe is this. Pay it. But there are even websites, if you would like to contribute to them to pay more. If you want to pay them at the city level, state level, federal level, it's fine to do so. But they call themselves the patriotic millionaires group because they're not going to do it unless they make you do it too.

Joey Loss 36:40

I've seen this on Facebook.

Adam Van Wie 36:41

So ridiculous.

Steven H Van Wie 36:42

And one of the head honchos has a sort of familiar name. Her name is Abigail. Her last name is Disney.

Adam Van Wie 36:53

Oh yeah, go figure.

Steven H Van Wie 36:56

And her grandfather Roy co founded Walt Disney Inc. With his brother Walt. And she's a documentary filmmaker.

Adam Van Wie 37:05

And I'm pretty sure that's not where her millions came from.

Steven H Van Wie 37:09

I'm pretty sure you're right. She says, and I quote, millionaires can afford a 2 percentage point income tax surcharge.

Steven H Van Wie 37:21

Oh, how about half millionaires? They don't seem to be able to handle it. What drives these people? It's got to be some form of insanity.

Adam Van Wie 37:33

Well, I can guarantee you that the vast majority of them did not earn their millions like this Disney person. I mean that, that I think is, is one common thread that you will see in a lot of these groups.

Steven H Van Wie 37:46

Yep.

Joey Loss 37:48

When she says surcharge, it's like, what does that mean? There's already a progressive tax system. So what does that mean? Like another 2%? Specifically if you have a net worth above a million.

Adam Van Wie 37:57

Well, but then you're conflating net worth and income.

Steven H Van Wie 38:00

Exactly. What's a difference? What does rich mean? You got to inquire to someone what rich means in their own mind.

Joey Loss 38:00

Totally different.

Adam Van Wie 38:04

Right.

Adam Van Wie 38:08

Yeah, well, by the most people's definition, having a $500,000 income would make those people rich. But they're saying that they're barely making ends meet. So are they rich? What's their net worth? Are they even millionaires? Probably not.

Steven H Van Wie 38:17

Right.

Joey Loss 38:23

Where do you live? Do you have kids?

Adam Van Wie 38:25

Yeah. You know, how much is your daycare? Like $4,200 a month.

Joey Loss 38:28

How much further do we want to disincentivize people to have families?

Steven H Van Wie 38:31

And just to show you that they're not, they're not picking on New York. They're also back in a California proposal that would impose a one time 5% tax on assets held by California billionaires and trusts. Well, these people. Won't be subject to it, will they? Because they're in New York.

Adam Van Wie 38:45

Well, that's interesting.

Adam Van Wie 38:48

Yeah. Well, and Also California lost $11.9 billion in income of the residents in the last year or so.

Steven H Van Wie 38:58

You got the number in New York.

Adam Van Wie 38:59

Yeah. New York lost $10 billion.

Steven H Van Wie 39:02

Governor Kathy Hochul

Steven H Van Wie 39:06

a couple of years ago probably said, and I quote, get out of New York and go to Florida where you belong, you rich people.

Adam Van Wie 39:14

Well, it was rich Republicans. Rich people specific. Yeah.

Steven H Van Wie 39:18

So they did. Yeah.

Adam Van Wie 39:21

And to the tune of 20.6

Adam Van Wie 39:25

billion net income dollars came to Florida, huh? Yeah. The biggest recipient by far of any state. Texas was second, and they were closer to 5 million billion. Sorry. Yeah.

Steven H Van Wie 39:41

Who knew? What. What can we do about these people? Kathy Hochul is now begging the rich people who left New York to come back because she said, we want to have the state with all these excellent fringe benefits and somebody has to pay for it.

Adam Van Wie 40:00

What a ridiculous sales pitch. Can you imagine? What if you were a wealthy New Yorker, former New Yorker, sitting in Palm beach in your lovely mansion, and Kathy Hochul is making the appeal to you to come give her and the state of New York a bunch of your money Why?

Joey Loss 40:19

Why would you do that after they vilified you for.

Adam Van Wie 40:21

Right. Even forgetting about that.

Steven H Van Wie 40:25

We don't want to. You smell funny. Whatever.

Adam Van Wie 40:27

Like even putting that to the side. Just. Can you imagine a sales pitch of, hey, come move over here. And you can pay a lot more taxes for benefits that you won't receive, but other people will.

Steven H Van Wie 40:39

Yeah, exactly.

Adam Van Wie 40:40

What? No. How about. No.

Steven H Van Wie 40:43

There's one more little quick one I want to get to you guys. I bet both of you understand the term making payroll. Yeah. Most of the people in the country have never been employers and they think the term sounds kind of whatever. What do you mean I gotta make payroll? Well, I've made payroll starting at my 28 and a half birthday. And ever since, making payroll means I don't care how. How much or little money you have. You pay your help first. Absolutely. First. And that there are no exceptions. I can't pay. Not good enough.

Adam Van Wie 41:16

Always.

Joey Loss 41:22

You borrow to pay if you have to.

Adam Van Wie 41:24

That's right.

Steven H Van Wie 41:24

I have. I have dipped into my 401k at least choice that I can think of. And we have mortgaged the house and we've done everything that we had to do to make payroll. No one can understand it unless they've been in those shoes. But you could if you thought about it. If you work for me or anybody else. And Friday's payday. What do you think should happen on Friday? Should probably get paid the right amount. Your taxes should be sent in as they're supposed to. And there should be no way you ever have to think about that. In Congress, you don't have to make payroll now think about that. They have more employees and more responsibility than any of us private sector people ever will, and they don't feel compelled to make payroll. And I shake my head and I can't understand. I just can't understand. They've lost something like 5, 500 people just in the past few weeks and they're not going to come back. And now you got to train everybody, which costs more. The Senate at 2 in the morning passes this so called bill and leaves town immediately for two weeks. Because if it's Easter, you got to have a two week vacation.

Adam Van Wie 42:49

Right, of course, of course.

Steven H Van Wie 42:51

The House looks at it and says, this is nuts. This is absolutely nuts. There's zero money for customs on the border. Zero. We're not even going to vote on this. So they did their own thing last night. Now is the Senate going to come back to work on Monday? Nope, I doubt it. And are people not getting paid? Yes, Trump's getting some of them paid, but not the backroom people, the upfront people. If they're visible out in the public at the screening booths or whatever, they're going to start getting paid again. He found money from the old BBBA from last year to do that for, for now, anyway. But the other people are not getting paid. I'm, like I said, I'm just so flabbergasted by this stuff. All right. Morgan Stanley had these tons and tons of hard drives and servers, and the law says that you break them into tiny little pieces and then you put them through a magnetic flux thing to erase them as best you can. All that stuff. Well, they didn't do it. They gave it to a guy to do it. One of their employees, I assume. And he saved the company $100,000 by giving the job to a moving company that had never done it before. The moving company auctioned all of them untouched on the Internet. People started to look at what they just bought and see what's in it. It cost them $155 million. On that happy note.

Adam Van Wie 43:11

No, definitely not.