10.26.22: Audio automatically transcribed by Sonix

10.26.22: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Producer:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs, and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.

Producer:
This is Another Money Show. Get set for another hour of the latest financial information and economic news affecting your bottom line. J.R. and Anthony are committed to helping more Americans like you optimize their income, reduce their tax risk, and reach financial freedom. So let's start the show. Here are your hosts, Anthony Corrao and J.R. Rotchford.

Anthony Carrao:
Here we are, your host, Anthony Carrao and J.R. Rotchford taking a break from our day-to-day as financial advisors at Rotchford and Associates, a fully independent fourth generation family practice right here in the greater Phoenix area. And we have this radio show, Another Money Show, to bring you financial information. You may not be here and elsewhere. We're aware that with all the radio shows out there, the last thing you need is another money show. But we appreciate you being here. Today, we're going to chat about a few things. We're going to bring up the banks again. That seems to be our favorite topic. We'll talk about some things in the news. But starting off, I mean, probably talk about the market a little bit today. You know, since our last show aired and the last record in the markets made. Quite a bit of rebound and we get a lot of people reaching out to us. Kind of almost smug a little bit because the market's going up when we were kind of preaching that this could be the next Great Depression. And the thing is, you know, our financial planning, the stuff we're doing for clients, you know, truthfully doesn't matter if the market goes up or down. We're protecting them both ways. We're allowing them to participate in the growth while taking out some of the risk for the fall. You know, our planning, our setting a foundation like we talk about, you know, it doesn't matter if the market goes up or down, it's building a foundation.

Anthony Carrao:
So you're going to be set regardless. And the truth is, it's not that we want the market to go down or we're rooting for it to go down in people to lose money differences. We're not out there just trying to sell for the sake of selling. People want to be in the market. We could double our salary every year if we just sell people the things that they want to buy. But that's not us. We know enough about what's going on in the background. We know we're setting up for disaster. We're building a bubble. The government has no foundation. The market has no foundation. The Fed has no foundation. Right? So people ask, you know, is the market going to drop in two weeks? Is it going to be six months? Is it going to be year? And I tell them it could happen today and not stop falling for the next five years. And it would not surprise me one bit because we have no foundation. There's nothing holding this up. That's not manipulation. That's it. And eventually you run out of ammo. I mean, what happens with inflation right now? The Fed kept the interest rates at zero for the last 15 years so that these large corporations, these institutional investors, could borrow free money and lift up their stock prices.

Anthony Carrao:
Yet now we have this massive amount of inflation caused by 2020, right? We shut down the economy and we print a bunch of money because obviously that's going to fix issues. Did it stabilize our economy? No, it doubled our market. So we've just made a bad bubble that was terrible leading up to COVID significantly worse. So are we rooting for the market to go down? No. Should it be going up? Absolutely not. And it wouldn't surprise me. Right. And I shouldn't say when surprised me. What I'm saying is the market in theory could go up every single day, year over year, for the rest of eternity. I believe that's possible. If we have a stable economy, things are getting better. If we're growing as a society in a positive direction, then yeah, absolutely, the market could go up, but right now it's going up with none of that. Things are going the opposite direction and the market and the economy aren't in lockstep. They're not the same thing. They're not they're not the same at all. They're completely opposite entities. But should there be some sort of comparison? Should they go in lockstep? A little bit, Yeah, that would make a lot more sense. So I don't know. JR, did you want to talk today?

J.R. Rotchford:
I don't need to. I don't need to. That. That was probably the best I've heard you in the four and a half years that you've been in the office. No, I mean, when you first came in, you were like, J.R., you've always been worried about stuff. There's always been stuff to worry about. And I was like, Yeah, yeah, yeah, but not this much. Hang in there. Start reading, start researching, and you'll see what I mean. Now you sound more like me than me. So I kind of feel like...

Anthony Carrao:
I think it's funny sometimes because people come in and they're like, Well, I'm smarter than you because I can read MSN News Money and they tell me this stock is good. So if they say it's good and I can read all these articles, then it's good. Or people some people in the in their pockets there, their little segments, we've had to deal with that with realtors and housing like, oh, well, housing is so much stronger this time around than it was in 2000. I was like, Yeah, but you know what? Housing isn't the stock market. But when housing fell, did it take down the stock market? Yes. So if everything else around housing is falling, housing is going to be affected. So it doesn't matter how strong that single pocket is, if everything else is falling, that's going to fall, too. And our worry is, is we're watching everything and everything seems to be on the verge of collapse.

J.R. Rotchford:
This is so funny. I mean, I know I just said it, but you are J.R. now, so welcome. Well, keep your hands and feet in the cart at all times because you're on board. Now.

Anthony Carrao:
That's what I tell people, is I used to be happy and now I am in this job with J.R., and I'm thankful for it, though I'm a lot more knowledgeable. But again, I mean, I think I even brought it up last week on a personal level for my finances. I don't care if the market falls because I only have enough allocated in it that I don't mind risking. And I also know that I have a timeline where if it takes 30 years to rebound like it did in the Great Depression in this country, or it takes 30 years to rebound like it did in Japan from the nineties up until the last few years, it finally came back. I have that time. I don't know if our listeners have that kind of time though.

J.R. Rotchford:
Whoa, that is the thought of Anthony Carrao I feel like if you listen to the show, you are definitely young, even if you're in your nineties. A couple things for you. One, let me take you back a few minutes. You said we want to make people safer for the fall. Did you mean like autumn change of seasons or like the fall of civilization? I just want to clarify.

Anthony Carrao:
Because, I mean, we bring up the fall. I mean, when we talk about setting a foundation in the first part of that is having food and water at home. So maybe, maybe both. Maybe the fall of civilization happens in the fall this year. Who knows?

J.R. Rotchford:
That was a good segue way into something I want to say. I want to get this out right up front because we're going to have a great show today. We're going to talk about a lot of financial stuff, which would be unusual for us, for us, for us, for us. So, you know, a lot of times people are like, well, you know, you're crazy. You've always been crazy. You're worried. You wear a tinfoil hat. Yeah, I know, I know. I know. So everything you're saying, what's going on? And people are starting to see it, feel it, think it, you know. Should you have extra food? Yes. Should you put a second mortgage on your house to buy? Said extra food? No. Life is about moderation. Hedge your bets. So buy a little extra food. Put it in the pantry, put some under your bed, whatever. You know, you should have five gallons of water per adult, per large sized dog. We've been itemizing what people should do. You know, you and I took a little tour a few weeks ago. A neighbor told us about an LDS warehouse where they have number ten cans and rice and beans and hot chocolate and all kinds of stuff. It's interesting. I think everybody should go there. I don't I don't know if we're allowed to say where it is or too much about it, but just kind of do some research and look.

Anthony Carrao:
Reach Out to us. We'll tell you.

J.R. Rotchford:
Reach out to us personally. Yes. And we'll tell you about it. But to me, I mean, it seemed relatively inexpensive and it just all they're selling is peace of mind. So if you haven't, you don't need it. So what if you need it? You and you don't have it, you have a problem. Our whole premise is be prepared, not scared. You know, when we help people, we protect and grow in that order. That's not a bad thing. You know, when you say that people come in and once we're all that you said the word smug, I believe people want to say we're wrong. Well, the beginning of this year, we were very right. We had already gotten a lot of our clients safer. We were proactive, not reactive, as we always strive to be. And they thought we were pretty smart. And then all of a sudden there was a little rebound for a few weeks there and they were like, Oh, oh. So yeah, you were not right. And then there was a big dump again a few weeks ago. And now the last couple of weeks here we go up again. Well, you know, I realize we're not a political show, but let me ask you a question. Is there any way that this is what they consider a melt up and perhaps this is going to last for the next two weeks for the midterms and then after midterms is going to fall? You know, I said last week, taking oil out of the strategic reserve, if you feel like that's the way to go as as a government, do it, but do it after the midterms, just wait a couple of weeks and then it won't appear like it could potentially be political.

J.R. Rotchford:
And by the way, the Strategic Oil Reserve, now we're down to the lowest level we've been since 1993. You know what that oil level is for? That's for emergencies. Gas prices at the pump. That is not an emergency. It may feel like it to a lower middle-class family. It is not. They're talking about war and they're talking about chaotic disruption that sort of is there for you know, Anthony, you remember a few years ago when oil when barrels of oil actually went negative. You remember we were making some phone calls. So, you know, people that we knew had their eye on oil, We're like, yeah, maybe it's the time to buy when it's free. You know, maybe this is a good time to pick some up. It was like that was money.

Anthony Carrao:
I do remember that some of my assets under management clients, that's when everybody was getting out. That's when we were buying in. I mean, oil wasn't going anywhere. And the fact that they're paying people to pick up barrels, you know, we didn't necessarily see free gas at the pump. It's a little bit more complicated than that. But oil stocks plummeted. That's when we picked them up, because that is a smart. That's a smart buy. We talk about that right now. You can do sector rotation. You can do smart purchasing, stuff like that when some stocks are on sale. The problem is even that we have to be careful and do moderation now because we're in a bubble. Warren Buffett, the best investor in the world In 2008, his Berkshire Hathaway B shares lost over 40%. So if the greatest investor in the world can lose that amount of money, you can too. And you can lose more if you're not nearly as good as him. I believe in you. If you really believe in yourself, you can lose a lot more money than Warren Buffett. So that's that's the problem when you're in a bubble market the way we are, even when things are smart purchases and on sale now it's like, well, you still kind of have to wait for that bubble to burst. It's 15 years of a run up in a market with some volatility in the fourth quarter of 2018, which is the reason for that volatility was the Fed wanted to be preemptive or proactive with interest rates and the market threw a fit. So helping to lead into where we are now and then March of 2020 where the entire world shut down in the market fell because that makes sense. What doesn't make sense is that the since then the market has doubled. But right now we're going to turn it over to our serious Jim producer. He's got a little something for us to lead out.

Producer:
Well, yesterday I was called an esteemed producer, but I'll take serious great job, by the way, guys. You were doing what the kids call spitting fire in segment one. Don't forget, along with listening to Another Money Show every Saturday at noon on 960, The Patriot, you can listen back to this and previous shows and our podcast catalog, it's very simple. All you have to do is hit that subscribe button on Apple, Google or Spotify or wherever you get your podcasts, and you can listen at any time, anywhere to Another Money Show, nine sixty The Patriot. We're back in a moment.

Producer:
Remember all of J.R. And anthony's listeners receive a free financial consultation just for listening to the show. Visit another money show to learn more and schedule an appointment. Thanks for listening to Another Money Show and subscribing wherever you listen to podcasts.

Producer:
Another weekend, another money show visit Another Money Show dot com.

Producer:
960 The Patriot. Welcome back. Inside, Another Money Show. Hey, if you like what you've heard today or in previous weeks, reach out to J.R. and Anthony for a free consultation. Fine. Gentlemen, if I may say so myself. And they'll help lead you to financial freedom. Call 623 523 0444. Again. 623 523 0444. Or reach out at team @ another money show dot com. All right. Friendly reminder. Always be prepared. Not scared. Proactive, not reactive. Right, guys, Good phrases to live by as we get more into today's show. Talking about investing in a market that's a little bit volatile, right?

J.R. Rotchford:
Yeah. Just to hear this market's just a bit outside. Way to go, Jim. You know, we are being replaced. I'm sure people listening are like, get rid of those, too. And by the way, when Jim says, reach out to these fine gentlemen, it doesn't matter which one you get, whoever answers the phone, because as of this morning, Anthony, are completely interchangeable. They were the most was the most similar to what I think all the time that I've heard yet. So back to the market, you know, when when people feel like they're trying to time the market, you know, you guys are right. You guys are wrong. You know, you're trying to manage money into the future without a crystal ball. Everything you said, Anthony, makes sense. There is zero foundation. We are a house of cards like never before. How's inflation going to end? Is it hyperinflation? Do we beat it because of these increases and interest rates? We don't know what tomorrow is going to bring. And you're talking about people that are looking at their retirement funds and they're trying to figure it out. By the way, you know, when you tell people read research, you know, do what I do, be a little sponge, taking everything you can and then use your own critical thinking skills and try to make the best decisions you can for yourself.

J.R. Rotchford:
You have to remember when and I have to remember this once in a while. I need to remember any time I read an article. This is opinion. You know, if you want to look backward and see what the facts are, you can do that. But when you're reading what people think are coming, that's what people think are coming. That's their opinion, not fact. So you've got to be careful. You know, we we're watching this market right now, whether it is political or whether the melt up is is very much contrived. You know, don't forget, the Dow Jones Industrial Average consists of 30 companies people, don't they? A lot of people still don't know that it's pretty easy to manipulate 30 companies offshore account stock buybacks, a.k.a. repurchasing tax breaks. It's pretty easy to make waves with that. And something I need to dig into. I used to know this the FAANG stocks, Facebook, Apple, Netflix, Google. I haven't looked at this a long time. Aren't some of those or all of those in the S&P 500 and not the Nasdaq?

Anthony Carrao:
So there's some crossover in between those because the Nasdaq's tech companies. But S&P can kind of be whatever an S&P is, approximately 500 companies and it's not exactly 500, but there hold of the entire market share. All the money out there in the stock world is about 80%, if I remember correctly. So looking at the S&P 500 is a much better indicator of the market as a whole because it incorporates so much.

J.R. Rotchford:
But since we have three different major benchmarks, I know there's the Russell 2000, there's all kinds of other ones, but the main ones are the Dow Jones, the Nasdaq, and the S&P. Clearly the Nasdaq being tech. I think all of the FAANG stocks should be in the Nasdaq. And I agree with you, the S&P is probably the most important to watch, but it should be a weighted average. We should take the Dow Jones, the Nasdaq and the S&P and use a weighted average on those. So, you know, one thing that you and I discussed yesterday, the Plunge team, if you've heard us in the past, you've heard us talk about something called the Plunge team, this melt up is scary. You know, we just recently talked about the railroad strike. How's this for getting off track with my ADD? So the railroad strike that was averted in the final hour by our government, it's not over. There's people that are saying and I heard it put out this way after the midterms, watch out for the railroad strike to come back. You know, everything could get really, really, really sketchy. And in the past, what we've seen, there's something called the Plunge team. If the S&P 500 goes up 20 or 30% next Monday, they will let it go up 20 or 30%. But if it goes down, I don't even remember what it was. I think it's 5% or 7%.

Anthony Carrao:
I think it's seven.

J.R. Rotchford:
Yeah, They stop the trading. They put they put a pause for like a half an hour and then they start it again. And if it happens again, they paused. The trading, I believe they do that three times and then they stop trading for the entire. Trading day. And I'm like, I just I don't get it. I do not get it. How come if it's a free market, you let unlimited upside, but you don't allow unlimited downside? It's a rigged game. Sorry, kids. So here's my answer. Pay down debt, buy hard assets. You know, should you have some securities? When we meet with you individually, we'll ascertain that. What's your timeframe? What's your risk tolerance? What's your age? What's your income, what's your taxes? What are your feelings on risk? We'll figure all that out for you individually. But I can tell you right now, the world around you says you ought to be really darn careful with things that can fall a lot faster than they go up. Jim, Just put in the little chat box. Railroad strike, you know, nobody's talking about it. We are, you know, tune in to us because we're talking about stuff that seems to be boring and old news. Bnsf, CSX, Norfolk, Southern Union Pacific, they're coming out with additional demands from the workers.

Anthony Carrao:
And isn't it they all have to be in agreement, too. So it's not just one union here, one union there, and they can come into agreements with a few of them. It's it's an all or nothing is my understanding of this. I believe that this many different ones with additional demands and trying to get this many people to agree on anything is practically impossible. I mean, there's only two of us on this radio show, and Jerry and I don't agree on much. So imagine getting all of these different groups with all of these different people.

J.R. Rotchford:
we do today.

Anthony Carrao:
It's going to be a tough one. We sat with that guy who worked for the railroad almost right after they had their quote unquote resolution. He's like, Oh, no, this isn't done. That was a preliminary that was just like that was very top level.

J.R. Rotchford:
And he also said it's not done by a long shot. He said that they're too far apart. He said it's not going to be done. And it just, you know, everything's fragile. We talk about our ten pillars all the time. There's so much that can go south. And yet this past calendar week, our four-for-one case, our the Dow is back, what, 32,000 again, it was at 28 a couple of weeks ago. It's just not making sense. So we we want to make sure at least the people that we deal with are awake and are aware and are nimble, Whether we're right or wrong, we don't know.

Anthony Carrao:
So and that's the thing, too, is setting a good foundation. This stuff shouldn't matter. You shouldn't have to watch the news every single day about the stock market. You should be set up in a position where that if it goes up, you benefit. And if it goes down, you know you're still safe. Protection over growth at this.

J.R. Rotchford:
that's not what people are taught. I mean, it's not what people are taught. They get in front of somebody with a blue suit, white shirt, red tie, highly polished shoes, and they're just sales. There's no financial. Our job is sales first and foremost, because even if you're the most honest advisor on the planet, if you don't keep moving things, you're going to be out of a job. So find somebody fully independent, find somebody that really seems to speak the truth, whether they gain or not, you know, I mean, yeah, sorry, I'm getting passionate again. And really a lot of this whole thing is if you find something that cares for you, whether they're with a big firm or a little firm, that's like gold run with that all day long. But with that said, why don't we go ahead and take a break and then resume this level of passion momentarily? As always, we are so glad you're with us. Thank you so much. And you can find us at team at another money show dot com find us, as Jim said on the podcasts. Give us a call 623 523 0444 and we'll help you in any way we can. Thanks.

Producer:
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Producer:
You're listening to Another Money Show.

Anthony Carrao:
Welcome back. You're listening to Another Money show with Anthony Carrao and J.R. Rotchford. And we had a little discussion with Jim right before late into this segment and starting to record again. And last week we were talking about how life expectancy is dropping. So that's that's good news, right? Because you need less money to to get you by. But what when I was saying earlier, I might want to kind of retract because I said, you know, I'm young enough to have 30 years to recover my money if there's another Great Depression. But what I didn't take into account is the possibility of a nuclear holocaust. So maybe I don't have much time left. Maybe we all have the same amount of time. So I don't know why we're giving financial advice at all. Maybe just spend everything you have. Buy that Corvette that you always wanted.

J.R. Rotchford:
All right. I need to intervene here as your stepfather, your business partner, the voice of reason, the one who is always considered crazy. And you're less crazy or not crazy at all. Well, let's not bring up nuclear holocaust into our show.

Anthony Carrao:
This show has taken a severe turn.

J.R. Rotchford:
Right? It's bad enough when you tell somebody we think there's going to be a 90% stock market decline, then there's going to be a bank bailout and then there's going to be digital currency. That's scary enough. You're going to double down and say that, like North Korea might shoot a nuclear ICBM or Russia might attack somebody that's doubling down. So, you know, one thing that you at, what, 32 years of age, and I believe Jim, is 33 years of age. You are the age range that has to fix all this. I don't care if people are like, well, the baby boomers messed it all up, you guys, you know, you did all this. It doesn't matter who did what going forth. Your generation has to fix it. And I apologize for you. We have a failing social fabric in Medicare, Medicaid, Social Security. You have to fix it. We have $31 trillion in debt on the books. You have to fix it. There's a whole bunch of people that are your age that are not prepared to fix it. You and Jim might be collateral damage because you're smart and you save more than you spend. And you did put away some food and you do save for retirement. You do all the right things. But there's a whole bunch of people in your age range that do not. And here's something interesting. I you know, I mean, I have three kids, all boys. It's amazing to watch the difference. The youngest one who is 18. And by the way, quick side story.

J.R. Rotchford:
My poor boy who's 18, was in an automobile accident yesterday. And I think since I have this platform, I'm going to bring something up. So this in one year, this poor kid has had three accidents twice. He was hit, he was standing still and he was hit. Neither of those two drivers were cited. I asked the officers on both scenes why that would be. And they basically I never really got a full answer that I understood. They're like, it's a no fault state that they don't have to cite. I was like, okay, but I think it's going to be harder to deal with the insurance company if the other person doesn't get a hit. And since a citation in my son was just sitting there when he got hit, so it seems pretty clear cut to me. But both times I am still dealing with the insurance company. Now, yesterday, unfortunately, it was my son's fault. Everybody admitted that and he did get cited. So I don't get it. But that's just personal thing. But he is okay. The most important thing, he's okay and we're moving on. But back to financial matters with my poor three times a charm accident, son. So he's in talks right now with the family on buying a new cell phone. And I'm watching this whole thing. He's. He's working. I mean, he's he seems to be working hard. He loves his job. And we've talked a little bit about a Roth IRA. We started talking about taxes. I'm trying to kind of educate him now that he's seeing what goes on in the real world.

J.R. Rotchford:
You know what his priority is a new cell phone. So the first one he shows me was 1490 $8. And it kind of made me I get angry about this because, first of all, a cell phone, you know, and he's well, it's a little computer. I get that. You don't need a little computer. It's bad for your eyes. It's bad for your brain. Get off Tik-tok and YouTube. So but 1500 dollars for a cell phone. I just had an experience when we upgraded and we never buy the newest model. My wife and I, we bought a couple generations old Samsung Galaxy for 800 or $800 for a phone, but we all need it nowadays. So anyway, our phones, I won't say the name of the carrier is they're pink and white, but our carrier, the the phone charger did not come with the phone. I can't make this stuff up. We paid 6000 dollars for two phones and then we had to pay another $40 per phone charges anyway. You know, if I can keep on track. Yeah, it's corporate greed on steroids. But how do you tell an 18 year old How do you tell a 24 year old, stop this. You know. Well, the batteries are dying, the batteries die faster and I need a new one. It's like they have you conditioned to spend your money on a new phone every two years or less. You know, you guys got to fix this. That's all I'm saying.

Anthony Carrao:
And we had a that's a kind of a good segway because we talked about corporate greed and the inflation. But the numbers came out from the Bureau of Economic Analysis, you know, over the last few years versus in these high inflation rates. But we're running out of time. So we are going to talk to you about that as soon as we get back. And in the meantime, you can listen to Another money Show. Wherever you listen to podcasts, you can find us at another money show dot com AnotherMoneyShow.com, or you can reach out to us directly at Team@AnotherMoneyShow.com .

Producer:
This is Another Money Show. Except this one's different. This one will actually keep you awake.

Producer:
Another weekend, Another Money Show, 960 The Patriot. Thanks for listening. If you've missed any part of today's show or previous episodes, subscribe wherever you get your podcast. And don't forget J.R. and Anthony. They're here to help. Call 623 523 0444, or you can reach out via email team@anothermoneyshow.com For a free consultation. Great stuff today, guys. I got to tell you, going through everything that we've discussed, the market and the lack of foundation, talking about even life expectancy, dropping, how we're 31. Oh my God, I can't believe I'm saying it. $31 trillion in debt. But also, Anthony, you teased at the end of last segment about how these corporations and we're going to give examples of how they price gouge their customers.

Anthony Carrao:
Oh, absolutely. So, I mean, you've seen them with phones. Appliances in general are not made to last anymore. They're made to break so you can replace and buy more because these companies aren't making money if you keep your dishwasher for 40 years. I mean, we've got a fridge in our office that is probably older than I am, probably closer to Jr's age, but it still works just fine. That is not what we're seeing anymore.

J.R. Rotchford:
It's avocado green. It is literally the old seventies refrigerator and it works so well. Our brand new I don't know what it is. Kenmore Some ridiculous thing in our house is about ten years old and it's been hobbling. It makes loud noises. It barely gets cold.

Anthony Carrao:
So in the nuclear holocaust, it's going to be the cockroaches and these avocado green refrigerators.

J.R. Rotchford:
And by the way, there's a term for that. I think it's called planned obsolescence. It's basically, you know, when I was a kid, roofs would last 40, 50, 60 years, air conditioners, 20, 30 years, you know, And now all this stuff, they're like, if you get ten years out of your air conditioner, you know, you're lucky. And how much is the new air conditioner? Oh, they're $6,000 each. What? You know, how did they make them so much cheaper that they don't even last? Sorry. Go ahead, Anthony.

Anthony Carrao:
What did you mean when we talked about CEO pay increases versus the average day American pay increases? We talked about the price of homes. The price at college is, jeez, that one just obnoxious. So basically what happened? Right. So we're talking about the Bureau of Economic Analysis. So there are costs to say a widget, Right. We're just going to anything talk about these refrigerators. There's phones broken down into three segments. You've got the cost of the materials, Right? So we know cost of materials and things have gone up, cost of labor. There's a massive push right now to increase labor costs. Now, the argument coming from some sides is, oh, we can't raise labor costs because that's going to increase the costs all around. We're going to have massive inflation. Well, we have massive inflation while still underpaying most of our citizens. So, so much for that. But there's we're kind of conditioned to think that raising pay and trying to build up a middle class is a negative thing. These these companies can't make money anymore. So you have labor costs, you have the costs of the material. And then these companies, they do need to make a profit. They need to make profits so they can expand, so they can hire people. Profits aren't bad. Greed, however, not so good. So before, in the years 1979 to 2019, the average rate for these three sections for labor cost was about 7.9%. So of the total cost of this widget going out, 7.9% is labor, the non labor inputs, the materials themselves. Oh, sorry, I'm reading off the wrong ones. So the non labor components were 34 38.3%. The labor cost was 7.0 geez, I'm doing it again. All right, Jim, we're going to have to go back and edit all that because I have screwed all of this up so.

J.R. Rotchford:
You don't need to add in. The nuclear holocaust gets here. This is going to be wiped out anyway.

Anthony Carrao:
Right. So we don't have to worry about it. So maybe we don't even make it from our recordings. The problem is the colors are too close together.

J.R. Rotchford:
So let's do this. Let me sum up the article that you send corporate profits. I'm going to read a one that really sums it up. Corporate profits only accounted for roughly 11% of price growth from 1979 to 2019. Today, record corporate profits account for 53.9% of price increases. Folks, corporate greed is driving inflation, not workers asking for better wages. You know, the wages are stagnant. Yes, that is true. But this inflation, this is the problem. So. And. And. Is there corporate greed? It seems like there is. And they're using that window of opportunity to do their stock buybacks. So they're they're. Yeah, they're making market share. Correct. But and we all know it. We all feel it.

Anthony Carrao:
Yeah. So labor costs actually have gone down. So we talk about raising wages, but the traditional the average from the past was 61.8% of these widget costs was labor. Right now that's only 7.9%. So we talk about raising wages and trying to increase that middle class yet. It's such a massive difference is anything it's cheaper now than it ever was in the past. You know, the cost of the goods themselves have increased, but they've increased by about 10%. It's that corporate profits that are just absolutely it's atrocious, really. Did you disappear?

J.R. Rotchford:
Nope, I'm here. I'm. I'm just taking in what you're saying. And I really you know, the answer for me is the same as always. What happens next? Do we rein this in? Does it keep getting worse? Do we tip? The unknowns are so great. And, you know, you can tie this back to the first segment if if the markets are flying high again this past week. Why? Why? I mean, you know, when you look at what's going on, everything comes so fast, by the way. I mean, you know, do you realize that that Halloween is next week? You realize after that, then Thanksgiving is in a month? I mean, I read something this morning that kind of shocked me. According to the American Farm Bureau Federation. I don't even know there's such a thing. The typical Thanksgiving dinner includes the staples of a £16 turkey, a gallon of milk, potatoes, ham. It's the right to hear this. The US Department of Agriculture shows that an 8 to £16 turkey cost nine one dollars $0.99 last week, up from a dollar 15 a year ago. This represents an almost 75% increase. So we're talking about small numbers on these, on the food items and so forth. But they add up. I read this morning that the average family is spending about four on average. So half is worth spending $445 a month more than they were two years ago. Gas, food, all the stuff that they.

Anthony Carrao:
Is increasing with that. I mean, I saw a meme earlier today that was joking about, you know, the Great Depression of 1929. Right. And it's saying, oh, no, I lost my house, I lost all my savings. And then it's talking about today in the 2020s, it was like, well, luckily I don't have a house or savings, so I have nothing to lose. So, I mean, it's really sad, but it's kind of where we're at with all of these institutional investors buying up all the homes with people living paycheck to paycheck like people had a lot more to lose 100 years ago than they do now. And that's sad.

J.R. Rotchford:
So speaking of things, to lose, I mean, don't forget, one of the things that we like to rail about is your money in the bank. How's that, Jim, for a Segway? So, you know, you lost your house, you lost your job, you lost your dog, all that stuff. Well, what if you lose your money in a bank? Why do people use banks? Because they're safe. It's liquid. It's it's funny. Oh, wow. Jim, just put a little stat for us on the screen. 32% of young people moving back in with their parents.

Producer:
Right. And you guys mentioned and made the comparison of the Great Depression about, oh, I'm going to lose my house, I'm going to lose my savings. Well, that's a number for you right there. 32% of people according to that. Again, according to what I just Googled, 32% of those people, they're not worried about losing their house because they have a place to go.

J.R. Rotchford:
And I am not good with numbers or math, but 32%, that's in a range of a third. That's a shocking number. If if that's accurate, that's yeah.

Producer:
That's that's by the way, from LendingTree. I just want to cite that.

Anthony Carrao:
So I mean, we we already talked about the problems that this country had leading up to pre-COVID, the issues. But the fact that this has been building up, people don't really have things. There's there's you don't have anything to lose. You know, the middle class isn't what the middle class used to be of years and years ago. So I don't know if that's sadder. I don't know if it will make the impact less. I don't know. Well, we know is it's not good. Oh, but let's let's go back to the banks because. Right. In theory, that should be the safest place to hold your money.

J.R. Rotchford:
Well, yeah, in theory. And the banks are a necessary evil. Sorry, Chase. You know the banks. We need them. We've got to put money in there. That's where you put your emergency fund. That's where you put your money so you can pay for your insurance, which is about to go up. In some people's cases, that's where you need your liquid money. So it's safe. It's there for you. You know, part of the problem, people feel like they're safe because in the stock market, you can lose 20% of your money in one quarter. You know, in the bank, you can't Well, you can't until you can, perhaps because we look at FDIC Gov. Go ahead, kids, and jot that down. Fdic, FDIC, dot gov. We go on there once in a while. The coffers the insurance the insurance to cover your money is at 1.23%. Let's let that soak in for a second. I mean, that means almost 99% of your money. They don't have money to cover it. So how safe is it if there was a bank bail in? I know we're all familiar with the term bail out. Thank you a lot. 2008. So the word bail in just means they're going to close the doors of the bank if you want to do a little research. Greece is the most famous example, but you can find it. Yemen, I believe Venezuela, Argentina, Brazil. There's a lot of places, China, there's a lot of things.

Anthony Carrao:
That the US will be fine over here.

J.R. Rotchford:
Yeah, we're going to be okay in this country. It can never happen here. Well, until it does anyway. So in 2017 I started showing people a little flyer that actually came in with my statement. This was at a credit union, by the way. You cannot avoid this. You can't go to a credit union or go to a online bank. All of these institutions are basically under the same situation. So anyways, so this there was a little a little flyer in my statement. Let me read one short part of it. This clause may require you to provide the credit union written notice of your intent to make a withdrawal from your account at least seven calendar days and up to 60 calendar days before you would like to make the withdrawal. The credit union may also limit the amount of cash provided in a withdrawal and may limit larger amounts to be non-cash items. So if I have to give you a week to two months notice to get my money, that could be problematic. By the way, you know what's missing from that little paragraph? How much you know, I know if you go to a bank right now, I don't care what bank and you ask for 5000 or more, you're going to have to make an appointment. They're going to give you a hassle. You really better get to know your bankers and have them trust you and know you. So but the problem is, if I want $14, this can apply. That means they're admitting and this was in 2017, they're admitting there could be a snag. And if you don't close your account, you're accepting their terms and conditions. You can't say, I want to opt-out of that part of it. I always want to be able to get my money. So, you know.

Anthony Carrao:
You can't pay for cash in things the way you used to. You can't pay your bills in cash. You have to have a bank. They force you. And just imagine what it'll be like when it's a digital currency. The amount of control they're going to have.

J.R. Rotchford:
And digital currency should be scary. By the way, I bring it up all the time, but make sure you look up. Executive Order 14067 Particular attention to Section four. I'm screaming it louder. I think we may actually be coming closer to things changing dramatically in this country. And I hate to leave this on a low note, but I want to wrap it up. We do need to do another full segment on the banks. We do need to talk about the reserves and all that. But for now, I think we had fun today. I mean, other than your whole fascination with nuclear Armageddon, I think it was a good day.

Anthony Carrao:
So solid.

J.R. Rotchford:
We are certainly always so happy that people are putting up with us and listening to us. If we can better your situation, we will be so honored. Reach out to us, make sure you find us and we will sit down with you one at a time. We have no minimums. We have no quotas, Fiduciary. Everything that's on the plus side will offer it to you. So reach out to us at team@AnotherMoneyShow.com or give us a call. 623 523 0444. Have a great rest of your weekend.

Producer:
Thanks for listening to Another Money Show. You deserve to work with a private wealth management firm that will strategically work to protect your hard-earned assets to schedule your free no-obligation consultation. Visit another money show dot com AnotherMoneyShow.com. Investment Advisory Services offered through Brookstone Capital Management, LLC BCM A registered investment advisor, BCM and Rotchford Financial are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents. Investment involve risk and, unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results.

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