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[SPEAKER_05]: This is a best-of-invest talk episode from KPP Financial.

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[SPEAKER_05]: Listener questions will be answered and commentary provided by Justin Klein and Luke Guerrero.

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[SPEAKER_18]: Richard and Santa Clarita will talk about treasury bills.

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[SPEAKER_03]: Yes, thanks Justin for once again taking my call.

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[SPEAKER_03]: I've been a listener of this show for a long time like over 10 years, and I try to catch every episode,

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[SPEAKER_03]: One of the things I have a question going back to what Steve Peasley used to say, and maybe emphasized it because it were the conditions back then, but he always said that whenever the tenure treasury is lower than the two year when you have the inverted rates there,

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[SPEAKER_03]: And he said that they're resistant, it may not be next month, or in five months, or maybe even 18 months, but we did have a period of time a while back where the, was a, an inversion that took was a long time lasting and then finally, it's, you know, switch back to more, you know, the normal,

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[SPEAKER_03]: So does that mean, and given what you've said about there are so many factors now from the war to AI and a lot of things confident, well, how does that hold, I mean taking that into consideration, I don't think we've had a recession since the last inversion.

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[SPEAKER_18]: Yeah, that's that's definitely true that we didn't have an official recession because it did invert back in 20 was that 20 yeah so that was back in 2023 early yeah into early 2024.

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[SPEAKER_18]: where it was inverted.

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[SPEAKER_18]: I think that we're in a new era.

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[SPEAKER_18]: That was post-World War II when things were a bit different now.

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[SPEAKER_18]: What we have is what I call, what we call an industry now, fiscal dominance.

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[SPEAKER_18]: where yes, there can, and there's a lot of manipulation of the yields curve by treasury, the Fed, they can do it based on issuance of issuing the long end to a short end, all of that.

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[SPEAKER_18]: And then,

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[SPEAKER_18]: the powers that be they don't they don't want a recession they don't want to preside a recession so they'll put through some sort of spending packages whether that's an emergency through some sort of a war things like that whatever it is they're they're they're they're manufacturing and that's why i say the the the risk to most for most people or they're they're just the markets excuse me is really a crash up that's kind of what you're seeing now everyone's worrying about oh wait type of deflationary bust crash and that's certainly could happen for

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[SPEAKER_18]: You've seen the short stints are hit with some sort of stimulus and in the background now you have such a large deficit and at large deficit means huge interest payments, we know it's now over a trillion dollars a year higher than the military spending, least for now.

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[SPEAKER_18]: And what that is is that is basically government spending.

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[SPEAKER_18]: right?

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[SPEAKER_18]: That's government spending because they're spending on interest and that's going to the people's pockets.

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[SPEAKER_18]: That's dollars being created.

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[SPEAKER_18]: And so that is kind of underlying everything and really pun intended, no pun intended, trumps everything.

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[SPEAKER_18]: Now a to a degree, not entirely, but definitely has this veneer of just stimulus, under the surface that's coming from government spending and government, government, large S government,

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[SPEAKER_18]: Effectively stimulus that's happening every single year with our deficits so large, right?

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[SPEAKER_18]: We're at what five, six percent deficit of the GP ratio, which those are levels that you see during a recession.

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[SPEAKER_18]: And so it's very hard to have a true recession when the government's spending that much.

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[SPEAKER_18]: The real worry is that eventually if the either number one, the

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[SPEAKER_18]: bond market takes away the printing press, basically saying we're no longer willing to finance you.

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[SPEAKER_18]: I think that's a more farther off than people understand, mainly because the treasury issue and schedule are they issuing the long on the short end right now and even under Trump, under the Biden administration, they were all kind of pushing on the low end, or the short end, which is issuing short dated treasury bonds, which I think is what you kind of asked about originally, and that is stimulative to the overall economy.

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[SPEAKER_18]: And so they're easy to find, financing in the short term.

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[SPEAKER_18]: What that ultimate release valve will be is the dollar.

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[SPEAKER_18]: And that's the, whether dollar has been structurally weak for a couple of years now.

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[SPEAKER_18]: And even when the, the, the expectation of Fed rate hikes increases, you're not seeing a big rally in the dollar.

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[SPEAKER_18]: I see structural downside in the dollar.

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[SPEAKER_18]: And that is the release valve of all of this money printing, all of this fiscal dominance, all of this fiscal

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[SPEAKER_18]: So I know I talked a lot there, kind of one of the tangent, but hopefully it gave you some perspective on what's going on with the underlying economy and why we're not seeing recession, even though we had that invertible curve.

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[SPEAKER_05]: All right.

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[SPEAKER_05]: Well, thank you very much.

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[SPEAKER_05]: No problem.

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[SPEAKER_05]: Thanks for the call Richard.

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[SPEAKER_16]: It's going to join for North Carolina.

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[SPEAKER_16]: How can we help you?

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[SPEAKER_16]: Hey, thanks for taking my call.

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[SPEAKER_16]: I have looked in your show for many years, and I'm also a client.

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[SPEAKER_16]: And I have, you know, gotten halfway decent at picking

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[SPEAKER_16]: And so now I have the problem of knowing when to trim a stock that's had a good run.

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[SPEAKER_16]: So I'd love to hear practical guidelines or practical advice for using tools like trailing stops or averaged true range, maybe technical tools that we could use.

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[SPEAKER_16]: That would help us take some of the emotion and timing out of it.

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[SPEAKER_16]: If you have any rules of thought that you could share to help us know when to trip, let's say.

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[SPEAKER_16]: a third of your position if it had a really gangbusters streak.

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[SPEAKER_16]: That's a great question.

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[SPEAKER_17]: You know, I think that any holistic portfolio construction needs to first take into consideration what you want to have your weight in sectors B.

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[SPEAKER_17]: And then when you construct what you want your weight in sectors B, then you can dive into those names that you want to hold.

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[SPEAKER_17]: But that in and of itself creates targets for where you want to be in both sectors and in those names.

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[SPEAKER_17]: And so the best way to not round trip, not round trip trades, but ride the roller coaster all the way up and all the way back down, is to be disciplined in not necessarily how you're setting your, you know, stop losses to, to, to lock in gains.

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[SPEAKER_17]: But in how strict you are with your tolerance levels at those two inputs that we just talked about, your sector weights,

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[SPEAKER_17]: individual target weights for your securities.

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[SPEAKER_17]: For us, we are pretty strict, right?

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[SPEAKER_17]: We have strict construction around how much we're willing to go overweight or underweight the segment benchmark.

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[SPEAKER_17]: When we constructed portfolios in the first place, and so if we go below or above, we are very strict in cutting names, trimming down on names, maybe some of the position, maybe all of the position,

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[SPEAKER_17]: Now, there's some things we know, right?

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[SPEAKER_17]: We know that stocks that exhibit positive momentum can tend to continue to do so in the short to medium term, so within the next 10 to 12 months, we know that names that are exhibiting poor momentum, tend to continue to do so over the next 10 to 12 months as well.

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[SPEAKER_17]: And so it's difficult to have a hard and fast rule.

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[SPEAKER_17]: There are times when, you know, we are people, we see names, they have very strong momentum.

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[SPEAKER_17]: You're gonna wanna ride that momentum.

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[SPEAKER_17]: But I think it is, you know, the enemy,

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[SPEAKER_17]: of good is perfect, right?

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[SPEAKER_17]: And so in order to have the probability of having the best investment experience, sticking to those constraints you put on your target weights for your securities and sectors is really your best friend.

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[SPEAKER_17]: You may want to ride that momentum with this name that you want to hold 4% off.

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[SPEAKER_17]: But there's a reason why when you enter that position, you should already have that exit plan, right?

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[SPEAKER_17]: Say, if I get above 6%, I'm trimming back down to four.

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[SPEAKER_17]: If this gets to this target value, I'm exiting it completely.

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[SPEAKER_17]: If it gets to this valuation, I'm exiting it completely.

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[SPEAKER_17]: And to an extent, maybe it's okay to have a little bit of tolerance beyond that 6% if it's a really positive momentum name.

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[SPEAKER_17]: But understand, there are certainly risks, right?

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[SPEAKER_17]: You created this plan,

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[SPEAKER_17]: at the outset to stay disciplined to avoid some of the pitfalls that investors tend to make.

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[SPEAKER_17]: And so having those strict constraints on yourself, I think is the best way to remain disciplined and when you decide to sell a position.

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[SPEAKER_17]: Thanks for the call, John.

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[SPEAKER_05]: If you are listening to an invest talk, best of call or questions compilation program.

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[SPEAKER_05]: Your comments and questions are always welcome, call anytime, 888-99 chart.

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[SPEAKER_05]: That's 888-99-CH-A-R-T.

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[SPEAKER_07]: This is a special in Vest Talk, Best of Caller Questions, compilation program.

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[SPEAKER_07]: Remember, the Invest Talk phone lines never close.

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[SPEAKER_07]: Please call with questions.

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[SPEAKER_07]: 888-99 chart.

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[SPEAKER_11]: Stay much, Justin.

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[SPEAKER_11]: Great job.

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[SPEAKER_11]: I'm calling you from Southern California.

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[SPEAKER_11]: That's a question about my rule over to Iris.

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[SPEAKER_11]: I'm retired and I'm 60-plus and I would like to certainly run out slowly over the next few years instead of all that weren't so avoid a big text bill.

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[SPEAKER_11]: My chapters will definitely be higher down the line and my candidate for a doctor or a loss.

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[SPEAKER_11]: Thank you.

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[SPEAKER_17]: Now a backdoor Roth is specifically for high-income earners who cannot contribute directly to a Roth IRA.

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[SPEAKER_17]: It involves making a non-deductible, traditional IRA contribution and then converting it.

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[SPEAKER_17]: That's not really what you need.

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[SPEAKER_17]: What you're asking is, is there a Roth conversion strategy?

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[SPEAKER_17]: Are you systematically converting portions of your traditional rule over IRA to a Roth IRA, over multiple years?

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[SPEAKER_17]: These are called Roth conversion ladders.

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[SPEAKER_17]: Now, here's why you might be a good candidate.

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[SPEAKER_17]: You are 60 plus and retired, which means you're not taking social security.

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[SPEAKER_17]: You're not taking RMDs, which started 73.

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[SPEAKER_17]: And so this is this gap between when you stop working, and when you're forced to

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[SPEAKER_17]: And so if your current tax bracket is lower now, then it will be later, which you said it was, or rather it will be, then it makes sense to pay the tax on the conversion that today's lower rate, then on your all future growth and withdrawals down the road.

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[SPEAKER_17]: Well, you probably don't wanna do is convert your entire RA in one year.

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[SPEAKER_17]: That would push you into the highest tax bracket possible to defeat the whole purpose of this.

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[SPEAKER_17]: So you want to convert strategically each year, filling up to the 22, 22, 12, 22 or 24 bracket.

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[SPEAKER_17]: But not going higher.

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[SPEAKER_17]: This minimizes your total lifetime tax bill.

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[SPEAKER_17]: It's called bracket filling or bracket topping.

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[SPEAKER_17]: It's probably one of the most powerful tax planning strategies that really exists there.

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[SPEAKER_17]: And this is a powerful tool, not just for you, but for anybody.

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[SPEAKER_17]: This is something we help our clients with all the time.

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[SPEAKER_17]: We have various tools that can say, okay, this is how much room you have.

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[SPEAKER_17]: This is how much benefit you can get out of it.

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[SPEAKER_17]: But the key is, you need to work with CPA or tax advisor.

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[SPEAKER_17]: You need to map out this projected income you're about year, through age 73, when you have to start taking those RMDs and you're obviously beyond social security.

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[SPEAKER_17]: Because you don't want to mess this up.

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[SPEAKER_17]: You don't want to push yourself into a higher tax,

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[SPEAKER_17]: The common misconception is you actually don't need earned income to do Roth conversions.

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[SPEAKER_17]: There's no income limit on conversions.

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[SPEAKER_17]: Anyone can convert regardless of how much they make.

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[SPEAKER_17]: There's a five-year-old converted amounts you can't withdraw the converted principal penalty free until five years after each conversion, but you're over 59 and a half.

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[SPEAKER_17]: So it's largely a non-

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[SPEAKER_17]: issue bottom line in your situation, a Roth conversion may make sense, but given the tax complexity, it is critical.

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[SPEAKER_17]: You work with a tax professional.

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[SPEAKER_17]: Thanks for the call.

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[SPEAKER_17]: It's dropping another listener question now.

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[SPEAKER_14]: Hello, I heard Justin talking recently about there's a possibility of us we going into recession within the next 18 months and it's an understand recession

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[SPEAKER_14]: I was calling regarding retirement allocations.

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[SPEAKER_14]: I have a third savings plan, and I was calling just to see what recommendation I could get regarding how to allocate money within that third savings plan between the international fund, the small cap fund, the S&P fund, the bond fund and the cash fund.

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[SPEAKER_14]: I would appreciate any insight.

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[SPEAKER_14]: Thanks.

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[SPEAKER_14]: I love the show.

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[SPEAKER_17]: So that's a very complicated question.

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[SPEAKER_17]: The reason why it's a complicated question is I don't know enough about you to give a general or rather to have a general sense of the important things to know before making these decisions.

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[SPEAKER_17]: How much assets you have relative to what you're going to need.

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[SPEAKER_17]: And I don't mean dollar value, I mean taking into consideration the traditional growth of those asset classes.

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[SPEAKER_17]: How far away are you from a time and how old are you?

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[SPEAKER_17]: All of these things change the math.

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[SPEAKER_17]: If you're in your 30s, you have a long time horizon.

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[SPEAKER_17]: With 30-plus years until retirement, you can afford to write out a recession even if one hits in the next 18 months.

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[SPEAKER_17]: History shows, markets recover well before what your retirement date would be.

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[SPEAKER_17]: So maybe you want to have 40-50% of the S&P 20-25% in small caps, 20-15-20% in international.

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[SPEAKER_17]: Very low bond exposure for that cash treasureied fund and that bond fund.

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[SPEAKER_17]: If you're in your 60s though, the calculus changes significantly.

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[SPEAKER_17]: The recession with an 18 months could hit right as you're starting to draw down, which is what we call sequence of returns risk.

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[SPEAKER_17]: Therefore you would want a more defensive posture, maybe 30 to 40% cash, 15 to 20% bonds.

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[SPEAKER_17]: 20 to 25% SNPs, way less risky exposure, which would be your small caps.

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[SPEAKER_17]: And so that's to say, the core of your question about a recession the next 18 months and generally they do happen more orderly.

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[SPEAKER_17]: You always remember the ones that are disorderly that happen all at once, but recessions are inevitable.

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[SPEAKER_17]: They are the inevitable part of the business cycle, but how much time you have left before you need your retirement is a key component that one must know before you make those investment allocation decisions.

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[SPEAKER_05]: Thanks for the call.

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[SPEAKER_05]: You are listening to an invest talk, vest of caller questions compilation program.

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[SPEAKER_05]: Your comments and questions are always welcome.

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[SPEAKER_05]: Call anytime 88899 chart.

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[SPEAKER_05]: That's 88899 CHART.

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[SPEAKER_05]: You are listening to an invest talk best of caller questions compilation program.

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[SPEAKER_05]: Your comments and questions are always welcome.

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[SPEAKER_05]: Call anytime 88899 chart that's 88899 CHART.

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[SPEAKER_10]: Hello, I'm Bestock.

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[SPEAKER_10]: I was calling in.

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[SPEAKER_10]: I'm running a question on whether or not to reinvest dividends.

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[SPEAKER_10]: that you suggest that to reinvest the dividends, whether no time you suggest not to reinvest the dividends, but wait and then you can control it better when you want the stock or ETF price that you want to buy into at.

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[SPEAKER_10]: So just wanted to see for instance, I was retirement age, but still investing in the VO of the S&P 500.

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[SPEAKER_10]: is that something where I think is it just best to just get the dividends and then once it's accumulated by more shares, I'll just make a purchase then at that point rather than just reinvesting it automatically.

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[SPEAKER_10]: So just wondered what your opinion is on that and I'll be listening to your podcast.

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[SPEAKER_10]: Thank you so much.

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[SPEAKER_18]: Well, this is a great question.

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[SPEAKER_18]: It's something that I think evolved over the years, especially as commissions have changed.

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[SPEAKER_18]: It used to be, you know, you get a dividend.

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[SPEAKER_18]: It's a small amount.

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[SPEAKER_18]: Are you not gonna take that money and,

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[SPEAKER_18]: and commit it, commit more to that position, and pay another dividend.

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[SPEAKER_18]: And so dividend reinvestment was a way kind of around that.

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[SPEAKER_18]: We'd automatically be reinvested in that stock that's paying it.

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[SPEAKER_18]: And then you can go and sell it whenever you need that income.

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[SPEAKER_18]: But we're now in an age where stock trades are nothing.

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[SPEAKER_18]: There's no cost there.

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[SPEAKER_18]: So no, it's a tougher decision.

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[SPEAKER_18]: And I think it's the pens on the person.

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[SPEAKER_18]: If you're a set it and forget investor, it's not that you're buying your

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[SPEAKER_18]: If you're a VOO guy or gal, then it doesn't really, there's no real, you're not actively taking, watching when that's going to dip and buy back in.

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[SPEAKER_18]: If you're a more active investor and you maybe want to use that money to diversify and be more targeted with that new fresh cash that's in your account, if that's who you are, then I would not reinvest the dividends.

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[SPEAKER_18]: Like I said, if you're a passive investor, just reinvest it.

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[SPEAKER_18]: Because otherwise, it's going to sit in your account, and who knows when you're going to actually get that put in, you're probably going to do it at a time where you go randomly check your account, or you see people talking about the market and how good it's doing.

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[SPEAKER_18]: You go check your account, oh, I have some cash in there and you throw it in, it's usually at about a time.

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[SPEAKER_18]: Probably you won't have the discipline to go and buy when,

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[SPEAKER_18]: CBC says, you know, market sell-off or market panic or whatever, those use the times that you do want to buy into the market.

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[SPEAKER_18]: So it just depends on who you are.

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[SPEAKER_18]: But it's certainly changed over the years like I said, because of the shift away from having to pay commissions at all.

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[SPEAKER_18]: But I like that you're buying dividend things, Docs, that's great.

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[SPEAKER_18]: So thanks for the call.

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[SPEAKER_18]: Let's take a live call in San Francisco.

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[SPEAKER_18]: We're going to talk to Lynn, listening on KDOW.

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[SPEAKER_18]: Do you have a question for me?

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[SPEAKER_09]: Oh, yes.

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[SPEAKER_09]: And I love your show.

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[SPEAKER_09]: You're the only person that actually tells us what to invest and what not to invest in.

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[SPEAKER_13]: Okay.

18:39.984 --> 18:44.346
[SPEAKER_09]: Anyway, Justin, I'm a low income advanced in age senior.

18:44.897 --> 18:56.001
[SPEAKER_09]: And I'm just wondering if you have just a couple of thousand to invest in the stock market and you're willing to take maybe a higher risk than the average person.

18:56.542 --> 19:05.985
[SPEAKER_09]: And then if you could invest like four or five hundred a month on going if there's anything that you would suggest to invest in.

19:06.386 --> 19:10.047
[SPEAKER_18]: Well, the first question I have is, you're you're you're all there.

19:10.676 --> 19:22.986
[SPEAKER_18]: you said you're relatively low income and this money is it is this for money is money to live on is you have a goal for this money what what is this money going to be used for and what time frame.

19:23.827 --> 19:31.012
[SPEAKER_09]: No this money would be separate from the money I'd live on so it would be something that could take me a little more risk.

19:32.130 --> 19:32.430
[SPEAKER_18]: got it.

19:32.551 --> 19:32.791
[SPEAKER_18]: Okay.

19:33.471 --> 19:42.761
[SPEAKER_18]: And so you're looking for maybe some funds or some asset allocation that would make sense over the maybe medium to long term?

19:43.722 --> 19:43.882
[SPEAKER_09]: Yes.

19:44.323 --> 19:44.563
[SPEAKER_18]: Okay.

19:45.073 --> 19:51.457
[SPEAKER_09]: Probably not too long term because I'm getting up there but yeah medium term medium term.

19:51.537 --> 20:02.225
[SPEAKER_18]: Okay, so you're willing to take some risk which means that you can probably get a little bit equities in there but in today's world I would probably want some sort of harder assets.

20:03.444 --> 20:08.027
[SPEAKER_18]: So I would probably have a mix between a global ETF.

20:08.487 --> 20:11.068
[SPEAKER_18]: Because you're probably not going to do individual stocks.

20:11.429 --> 20:17.612
[SPEAKER_18]: It doesn't sound like you probably have the time or the wherewithal to do deeper research on individual names, correct?

20:19.093 --> 20:20.274
[SPEAKER_18]: So you want to stick with funds.

20:20.714 --> 20:23.175
[SPEAKER_18]: Probably want a low cost, a global ETF.

20:23.275 --> 20:25.056
[SPEAKER_18]: I think that would be the start.

20:25.076 --> 20:30.560
[SPEAKER_18]: There are a lot of good ones out there that are low cost, but I would focus on global, not just domestic.

20:31.358 --> 20:36.206
[SPEAKER_18]: Then I would probably sprinkle in a good amount of harder assets.

20:36.226 --> 20:42.978
[SPEAKER_18]: So number one, like a re-fund that would produce some income for you, a diversify you beyond just equities.

20:44.369 --> 20:52.671
[SPEAKER_18]: And I also have some sort of precious metals, probably a mix between gold and silver, precious metals, probably in the 10 to 15% of that portfolio.

20:53.792 --> 20:57.553
[SPEAKER_18]: And so that's those are the three main assets.

20:57.593 --> 21:04.314
[SPEAKER_18]: You probably want to mix in a little bit of fixed income, probably shorter duration bonds as well, maybe in the 20 to 25% of the portfolio.

21:06.755 --> 21:12.719
[SPEAKER_18]: So those are the three main areas that I would focus, I'm sorry, there's the before main areas I would focus on.

21:13.179 --> 21:21.205
[SPEAKER_18]: You want to lean probably 50% of that being in the global ETF, equity ETF, and then the other 50% spread between those other three.

21:21.725 --> 21:23.066
[SPEAKER_09]: Thank you so much.

21:23.466 --> 21:24.567
[SPEAKER_09]: I appreciate it.

21:24.987 --> 21:28.409
[SPEAKER_18]: No problem, I wish you good luck and call back if you have any more questions.

21:29.070 --> 21:31.011
[SPEAKER_09]: Thank you Justin, thank you for being here.

21:31.251 --> 21:32.032
[SPEAKER_05]: You too as well.

21:33.262 --> 21:38.106
[SPEAKER_05]: This is an invest talk best of caller questions compilation program.

21:38.466 --> 21:45.271
[SPEAKER_05]: Your comments and questions are always welcome call anytime 88899 chart that's 88899 CHART

21:59.982 --> 22:04.085
[SPEAKER_18]: At KPP Financial, Accountability means more than advice.

22:04.785 --> 22:17.974
[SPEAKER_18]: It means we invest alongside you, through our parallel investing approach, when we recommend an investment for clients, one or more KPP principles invest their own capital at the same time.

22:18.754 --> 22:21.656
[SPEAKER_18]: Same day, same price, same percentage.

22:22.337 --> 22:25.539
[SPEAKER_18]: If your portfolio moves, ours does too.

22:26.199 --> 22:27.080
[SPEAKER_18]: That is alignment.

22:27.560 --> 22:28.820
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22:29.320 --> 22:31.361
[SPEAKER_18]: That is the KPP difference.

22:32.261 --> 22:36.942
[SPEAKER_18]: Visit investtalk.com to get your free portfolio review.

22:52.889 --> 22:55.230
[SPEAKER_02]: Hey guys, I love the show, Mark from San Diego.

22:55.490 --> 23:07.115
[SPEAKER_02]: Just looking for your long-term and shorter term, how it looks on oil, with all the gyrations in the Middle East, but still, your area is fun as well.

23:07.235 --> 23:19.980
[SPEAKER_02]: So individual stocks like X-R and Chevron and that kind of stuff, oil stock, and I'm wondering if I can grab now, or if you sit on it, I've been no rush to sell them, but they've been up quite a bit in the last couple of years,

23:21.928 --> 23:28.732
[SPEAKER_02]: The thoughts are long-term, trim, and then on it, or ran too much, and I will see you on show, thank you, bye.

23:29.272 --> 23:35.315
[SPEAKER_18]: There's a lot of lessons to me that have come out of this war, not just politically.

23:36.236 --> 23:37.837
[SPEAKER_18]: That's one lesson.

23:38.157 --> 23:40.218
[SPEAKER_18]: I think everyone's probably learning in some way, shape, or form.

23:41.162 --> 23:45.848
[SPEAKER_18]: but it's also about the oil and energy industries.

23:46.369 --> 23:47.831
[SPEAKER_18]: And then Amix in the oil patch.

23:48.291 --> 23:55.681
[SPEAKER_18]: And to be the big takeaway is, the closing of the street of Hormuz was something everybody warned about for a long period of time.

23:55.721 --> 23:58.144
[SPEAKER_18]: And frankly, you know what I'm doing this long time, 25 years.

23:59.363 --> 24:00.003
[SPEAKER_18]: I heard about it.

24:00.404 --> 24:13.532
[SPEAKER_18]: I never thought it was really was a big risk, but it was a big boogie man, that everyone throughout there, that if that happens, the oil markets will go crazy, they will go insane, and that would be the end of the world.

24:14.873 --> 24:16.994
[SPEAKER_18]: Well, guess what, we're over three months into this.

24:17.935 --> 24:24.539
[SPEAKER_18]: And there are issues, I'm not saying there aren't, and obviously if it's closed, another probably month or two, there'll be even more issues.

24:25.297 --> 24:32.959
[SPEAKER_18]: So it's a problem, but clearly it's not nearly a big of a problem as everyone made out to be before it ever happened.

24:33.659 --> 24:33.819
[SPEAKER_18]: Why?

24:33.839 --> 24:40.861
[SPEAKER_18]: Because oil is a global market, and the Middle East has the most oil, but it's not the only place to get oil.

24:41.561 --> 24:46.482
[SPEAKER_18]: And so the lesson here is that if this isn't going to moon shot oil prices to levels that

24:48.675 --> 24:56.098
[SPEAKER_18]: allow the big oil companies to extract oil at huge valuations or huge margin.

24:56.118 --> 25:15.425
[SPEAKER_18]: So we say, then what is then what is so I did is I said, if you're going to gain exposure and I'm talking right now, you know, it's okay to have some exposure right now for a super site like because that's a, I think a pretty good political bet that this will come to a head to a point where

25:16.540 --> 25:23.966
[SPEAKER_18]: prices do accelerate to the upside and it puts pressure probably on the current US administration to do something to resolve it.

25:24.767 --> 25:29.090
[SPEAKER_18]: Right now, it was at, you know, $90 a barrel in that range, kind of hanging between 90 and 100.

25:29.891 --> 25:33.034
[SPEAKER_18]: Higher, not great, but not a catastrophe for the world.

25:33.674 --> 25:38.879
[SPEAKER_18]: But what it's telling me is that if you want to invest in this space, I don't really

25:39.773 --> 25:43.955
[SPEAKER_18]: feel great about the big oil and oil names, just EMPs in general.

25:44.356 --> 25:49.198
[SPEAKER_18]: First off, you have to understand that their price takers means that they just get what the market says they're going to get.

25:49.679 --> 25:51.560
[SPEAKER_18]: So not much strategy behind that.

25:51.580 --> 25:54.962
[SPEAKER_18]: You have this hedging and things like that, but overall their price takers.

25:55.262 --> 25:57.943
[SPEAKER_18]: So I said, what about the rest of the energy world?

25:58.443 --> 26:02.606
[SPEAKER_18]: But about transport stocks, meaning the pipeline companies.

26:03.806 --> 26:08.089
[SPEAKER_18]: And then I want to look at Chevron, Exxon, and then the Williams company.

26:08.984 --> 26:10.605
[SPEAKER_18]: Look at the last 10 years.

26:11.386 --> 26:14.207
[SPEAKER_18]: Even the last 15 years, last 10 years, look at William's company.

26:14.608 --> 26:16.389
[SPEAKER_18]: Total return, 14 and a quarter percent.

26:17.129 --> 26:19.431
[SPEAKER_18]: Total the largest oil pipeline companies out there.

26:19.871 --> 26:31.339
[SPEAKER_18]: Then you look at Chevron, nine percent, total return, or last 10 years, X on seven and a half, plus 15 years, X on 6.2, Chevron 6.6 William's company, 8.5.

26:32.359 --> 26:35.662
[SPEAKER_18]: So clearly, it makes more sense to own the pipeline companies.

26:36.582 --> 26:37.203
[SPEAKER_18]: Then what about,

26:38.046 --> 26:40.727
[SPEAKER_18]: The refiners, the largest ones of Laro.

26:41.148 --> 26:42.448
[SPEAKER_18]: What's that we're turning to last 10 years?

26:42.729 --> 26:47.171
[SPEAKER_18]: 18 and a half percent, annualized, that's an incredible return.

26:47.691 --> 26:52.534
[SPEAKER_18]: 15 years, 18 percent, annualized, just consistent.

26:53.334 --> 26:55.235
[SPEAKER_18]: And they're not building a lot of new refineries.

26:55.776 --> 26:57.857
[SPEAKER_18]: And it's difficult to get new pipeline spilt.

26:58.735 --> 27:05.697
[SPEAKER_18]: So it's all about scarcity there, and they can, they're the only game in town for the most part, they can extract higher returns.

27:06.317 --> 27:22.681
[SPEAKER_18]: So my lesson here is, I wanna own those names in the oil patch, names that have exposure to, finding that have midstream capabilities, meaning moving oil and gas from the wellhead to where it's actually pretty, actually used.

27:23.161 --> 27:24.922
[SPEAKER_18]: That's the way I'm starting to look at the oil instrument.

27:25.845 --> 27:30.746
[SPEAKER_07]: Invest Talk is ready 24-7 for your finance and investment questions.

27:31.046 --> 27:35.847
[SPEAKER_00]: I'm hoping you'll give me your cake on or Matt Technologies ORA.

27:36.208 --> 27:42.869
[SPEAKER_15]: Is it a good idea to sell your losses in a Roth IRA and just use whatever you have left to reinvest in the better stock?

27:43.189 --> 27:44.349
[SPEAKER_07]: Don't forget to call.

27:44.670 --> 27:47.930
[SPEAKER_07]: Invest Talk 888-99 chart.

27:49.071 --> 27:54.752
[SPEAKER_08]: Hi, this is Jen in Portland, Oregon, and I have a question about private credit versus private equity.

27:55.323 --> 28:19.881
[SPEAKER_08]: There's a lot of news lately about private credit and investors' wedding redemptions, firms, not always allowing all of those, and I was just wondering if you can speak to whether private credit also includes private equity firms, or if not, three companies like how those interact, and also if they are something separate, I'm also curious what private equity firms look like right now in terms of performance.

28:20.282 --> 28:22.743
[SPEAKER_08]: I know that they often have investments in the

28:25.175 --> 28:28.702
[SPEAKER_08]: reporting that might be somewhat opaque or limited in frequency.

28:29.143 --> 28:30.646
[SPEAKER_08]: I would love to hear the answer on your show.

28:30.746 --> 28:31.267
[SPEAKER_08]: Thanks so much.

28:31.817 --> 28:36.581
[SPEAKER_18]: This is a great question, and there are some similarities and differences.

28:37.122 --> 28:40.424
[SPEAKER_18]: The first similarity, the main similarity, is that they're both private.

28:40.785 --> 28:43.087
[SPEAKER_18]: They're both called private, private equity, private credit.

28:43.327 --> 28:46.369
[SPEAKER_18]: Meaning, you don't know what the true value is.

28:46.550 --> 28:47.290
[SPEAKER_18]: It is private.

28:47.831 --> 28:48.431
[SPEAKER_18]: It is not public.

28:48.451 --> 28:49.432
[SPEAKER_18]: It's not in public markets.

28:49.452 --> 28:50.633
[SPEAKER_18]: It's not traded every day.

28:50.973 --> 28:52.815
[SPEAKER_18]: That's the best thing about public markets.

28:52.915 --> 28:54.176
[SPEAKER_18]: It is liquid.

28:54.857 --> 28:56.198
[SPEAKER_18]: It is transparent.

28:56.718 --> 28:58.059
[SPEAKER_18]: You know what the value is.

28:58.880 --> 29:03.263
[SPEAKER_18]: Don't let anyone ever tell you that private is better than public.

29:03.743 --> 29:05.584
[SPEAKER_18]: If you're talking about the same asset class, say that.

29:06.105 --> 29:11.628
[SPEAKER_18]: Now there are private startup investments, things like that that may be great opportunities.

29:11.668 --> 29:13.109
[SPEAKER_18]: I'm not going to poo poo those.

29:13.329 --> 29:15.030
[SPEAKER_18]: I've made those and I've been great with those.

29:15.991 --> 29:21.815
[SPEAKER_18]: But if you're talking about asset classes in general, I much rather own public credit or public equity.

29:22.577 --> 29:24.598
[SPEAKER_18]: versus private credit or private equity.

29:25.078 --> 29:26.458
[SPEAKER_18]: So those are the similarities.

29:27.058 --> 29:27.798
[SPEAKER_18]: Now what are the differences?

29:28.518 --> 29:33.800
[SPEAKER_18]: One's credit, one's equity, credit is basically bonds at this capital structure.

29:34.580 --> 29:43.722
[SPEAKER_18]: You own when you own private credit, you own the debt of these various companies and it's a portfolio of debt portfolio of companies that you own the debt on.

29:44.722 --> 29:46.383
[SPEAKER_18]: Private equity, you own the equity.

29:47.060 --> 29:53.745
[SPEAKER_18]: But it is, you own effectively ownership in the business, the upside of the business.

29:54.726 --> 29:58.049
[SPEAKER_18]: That's more risk, because you're lower on the capital structure.

29:58.709 --> 30:03.293
[SPEAKER_18]: Credit, debt is at or near the top of the capital structure.

30:03.974 --> 30:08.918
[SPEAKER_18]: So that means in bankruptcy, they're the first ones to be paid back.

30:09.798 --> 30:11.480
[SPEAKER_18]: For equity, you're at the bottom.

30:12.340 --> 30:14.582
[SPEAKER_18]: And usually in bankruptcy, you get next to nothing.

30:17.171 --> 30:18.111
[SPEAKER_18]: has to pay you out money.

30:18.652 --> 30:20.973
[SPEAKER_18]: They're regularly, and some has monthly quarterly, et cetera.

30:21.393 --> 30:25.535
[SPEAKER_18]: And they need their companies to perform in order to get that cash flow.

30:26.055 --> 30:40.643
[SPEAKER_18]: Whereas private equity, the hope is that eventually they'll sell off the businesses, maybe to another private equity firm, maybe to go public, that's the ultimate dream is to actually take some of these companies they bought and take them public and cash out.

30:41.502 --> 30:44.603
[SPEAKER_18]: But that could be in five years, could be seven years, could be 10 years.

30:45.563 --> 30:51.165
[SPEAKER_18]: They continue to push, kick the can down the road, and push winding down a lot of these private equity funds.

30:52.025 --> 30:55.887
[SPEAKER_18]: Until later, and later, because they can't get liquidity for these businesses and all of them are struggling.

30:57.087 --> 31:03.069
[SPEAKER_18]: And the same with private credit, but once again, you know that easier because they're actually, are they paying you or not?

31:03.089 --> 31:03.929
[SPEAKER_18]: They're supposed to be paying you.

31:05.270 --> 31:09.111
[SPEAKER_18]: Not in picks, what's called payment in kind, but actually cash.

31:10.209 --> 31:11.630
[SPEAKER_18]: and some of them have stopped doing that.

31:12.311 --> 31:13.392
[SPEAKER_18]: And so that's the difference here.

31:13.412 --> 31:21.198
[SPEAKER_18]: So when the private credit is safer, then private equity, but it does have its own potential issues.

31:22.039 --> 31:27.543
[SPEAKER_18]: And think of it as a very high, a very junky, high-yield bond fund.

31:27.903 --> 31:33.228
[SPEAKER_18]: It's effectively what it is without you knowing what the value is and hoping you continue to get paid.

31:33.968 --> 31:36.249
[SPEAKER_18]: It's kind of what private equity, a private credit is.

31:37.069 --> 31:39.490
[SPEAKER_07]: Hopefully that gave you a good sense of the difference.

31:40.030 --> 31:44.952
[SPEAKER_07]: Invest talk is ready 24-7 for your finance and investment questions.

31:45.252 --> 31:49.854
[SPEAKER_07]: My five year old son and I listen to your podcast every night, so thank you very much for putting it on.

31:50.054 --> 31:53.935
[SPEAKER_07]: Justin Klein is here and ready to tackle your questions.

31:54.403 --> 32:01.044
[SPEAKER_15]: Is it a good idea to sell your losses in a raw IRA and just use whatever you have left to reinvest in the better stock?

32:01.064 --> 32:07.326
[SPEAKER_10]: I'm wondering what you thought about this read is it would be a good time to get in?

32:07.606 --> 32:09.406
[SPEAKER_12]: I wanted to pick your brain about Apple.

32:09.666 --> 32:11.247
[SPEAKER_12]: What did you think about their earnings call?

32:11.587 --> 32:13.327
[SPEAKER_12]: Is this a good time to ask for my position?

32:13.467 --> 32:14.607
[SPEAKER_07]: Don't forget to call.

32:14.947 --> 32:15.727
[SPEAKER_07]: Invest talk.

32:16.048 --> 32:16.448
[SPEAKER_07]: 888-99 chart.

32:19.343 --> 32:22.685
[SPEAKER_18]: We're gonna go take a live call and talk to Chris and Pleasant Hill.

32:22.705 --> 32:24.907
[SPEAKER_18]: It was like about Roth conversions.

32:25.607 --> 32:27.648
[SPEAKER_13]: Yeah, hi, thanks for taking my calls.

32:28.149 --> 32:47.181
[SPEAKER_13]: Yeah, I'm just struggling with understanding the benefit of, you know, paying the taxes now versus later because you do have less money working for you over time, you know, each year you pay the taxes on the conversion

32:48.788 --> 32:51.930
[SPEAKER_13]: And in my case, I'll probably have to pay like 24%.

32:52.010 --> 32:58.753
[SPEAKER_13]: I don't know, I just struggle with that fact that I'm reducing my money by 24%.

32:58.853 --> 33:06.236
[SPEAKER_18]: So the concept is very simple, but executing an effectively is challenging without the right tools.

33:06.476 --> 33:08.817
[SPEAKER_18]: So let me explain.

33:09.358 --> 33:13.860
[SPEAKER_18]: So when you're doing Roth conversions, what your goal here is effectively tax arbitrage.

33:14.500 --> 33:17.103
[SPEAKER_18]: Okay, so you talked about your 24% tax rate.

33:17.243 --> 33:27.316
[SPEAKER_18]: Okay, so if you took 100,000 dollars, she's around numbers, and you pay 24% tax today, and you're left with $76,000.

33:29.377 --> 33:36.664
[SPEAKER_18]: and you go invest that $76,000 and you earn the same return on that $76,000 over the next called 20 years.

33:37.284 --> 33:47.534
[SPEAKER_18]: As you would, if you didn't do the conversion and you invested $100,000, and you have the same return, and then you take the money out in 20 years at the same tax rate of 24%.

33:49.908 --> 33:53.909
[SPEAKER_18]: The amount you would get, net attacks is, would be exactly the same.

33:54.489 --> 33:55.749
[SPEAKER_18]: It would be exactly the same.

33:55.789 --> 33:57.570
[SPEAKER_18]: The numbers are exactly the same.

33:58.230 --> 34:08.372
[SPEAKER_18]: So the only reason to do it is if your tax rate today when you do the conversion is lower than what it will be in the future.

34:08.392 --> 34:17.013
[SPEAKER_18]: What you're effectively doing is saying, I wanna lock in this tax rate two day because in the future I will be in a lower,

34:20.200 --> 34:25.424
[SPEAKER_18]: Okay, so that's why usually if you make a lot of money, you're in a high tax bracket.

34:25.724 --> 34:27.105
[SPEAKER_18]: You probably don't want to do rough conversions.

34:27.946 --> 34:42.437
[SPEAKER_18]: Usually the best time to do this is after retiring the year after when you're not making, you know, having come any more and between that time and when you take Social Security and especially before you take RMDs.

34:43.097 --> 34:54.742
[SPEAKER_18]: And that's what you're also trying to avoid is RMDs and being forced into a higher tax bracket because that's what happens a lot is that you're forced into this higher tax bracket when you do the RMDs and then you have no control.

34:55.202 --> 35:00.745
[SPEAKER_18]: So what you're doing with art with Rothconversions is you're taking control today and locking in potentially lower rate.

35:01.105 --> 35:08.508
[SPEAKER_18]: Now, this is what we do for clients, and this is what I say with the right tools you can affect, you can understand is, what is my tax rate today?

35:09.309 --> 35:16.792
[SPEAKER_18]: What will my tax rate be next year in five years and 10 years and 20 years based on my social security income?

35:17.052 --> 35:18.253
[SPEAKER_18]: Do I get pension income?

35:18.313 --> 35:19.553
[SPEAKER_18]: What am I going to retire?

35:19.613 --> 35:21.054
[SPEAKER_18]: How much money am I making today?

35:21.094 --> 35:22.915
[SPEAKER_18]: What am I likely to be making in 510 20 years?

35:24.411 --> 35:25.632
[SPEAKER_18]: your entire financial picture.

35:25.652 --> 35:27.073
[SPEAKER_18]: This is what we do for clients.

35:27.393 --> 35:35.719
[SPEAKER_18]: Beyond just managing their accounts, we're also developing these strategies from a financial plan.

35:35.739 --> 35:37.641
[SPEAKER_18]: This is what a financial plan does.

35:38.401 --> 35:41.444
[SPEAKER_18]: Now, we have tools, we don't have to say, we're not doing the calculations ourselves.

35:41.484 --> 35:43.325
[SPEAKER_18]: We use what's called a Ryan planning, and kind of,

35:43.859 --> 35:51.848
[SPEAKER_18]: It's what we are client where we're clients log in and they can see their counts and all the transactions and everything But also see all their entire financial picture.

35:51.868 --> 35:58.114
[SPEAKER_18]: They can pull in their bank accounts and credit cards and mortgages and everything else and I'll put it all together and we can also say

35:58.775 --> 36:20.357
[SPEAKER_18]: Hey, what is your, what are you going to get at retirements from Social Security right at 67 or 70 in fake and plan out when you should take Social Security also based on Roth conversion right because a lot of times it's like not only should you wait to take Social Security so that you know it grows, but also you can do more Roth conversions between now and when you take actually get Social Security.

36:20.857 --> 36:31.885
[SPEAKER_18]: So all of these are moving, it's a complex moving picture that you need to put together either yourself or have somebody that has the tools that can do it for you.

36:32.505 --> 36:33.866
[SPEAKER_18]: So that's why you're confused.

36:34.186 --> 36:38.470
[SPEAKER_18]: It's number one you don't understand the basic math, which is it's all about tax arbitrage.

36:38.490 --> 36:38.770
[SPEAKER_18]: That's it.

36:39.170 --> 36:39.650
[SPEAKER_18]: That makes sense?

36:40.051 --> 36:41.011
[SPEAKER_13]: Yeah, thank you very much.

36:41.352 --> 36:41.712
[SPEAKER_13]: No problem.

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[SPEAKER_18]: Thanks for the company.

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[SPEAKER_06]: In today's world, a variety of factors are affecting the stock markets.

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[SPEAKER_06]: Investalk 888-99-Charne.

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[SPEAKER_01]: Hi, guys.

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[SPEAKER_01]: My question is regarding, when you calculate ratios for companies, do you usually use the gap or non-gap?

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[SPEAKER_01]: Because, you know, some of these numbers vary so much, what is your policy and when you do your calculations in general?

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[SPEAKER_18]: Thank you.

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[SPEAKER_18]: We always use, always use gap.

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[SPEAKER_18]: But far more often than not, especially when you're getting into growth year names, tech names, et cetera, they're using non-gap numbers because they don't like the way the gap.

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[SPEAKER_18]: Numbers come out.

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[SPEAKER_18]: And where Gap is generally accepted accounting principles.

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[SPEAKER_18]: So that, and it's there for people like us investors to look from company to company and know that if we're looking at earnings or cash flow or whatever, that it's calculated in the same manner as every other company that's out there.

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[SPEAKER_18]: Now there are wrinkles when it's getting that you have to adjust for that can make certain companies look a little bit different than others.

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[SPEAKER_18]: And that's why a lot of them use non-gap, but the problem is when it's getting non-gap is just bastardizing the process of telling a public how the company is doing.

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[SPEAKER_18]: So when you hear non-gap, one non-gap is not the same as another non-gap.

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[SPEAKER_18]: They're not using the same non-gap process.

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[SPEAKER_18]: They're making up their own non-gap process.

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[SPEAKER_18]: And saying, based on this non-gap process, this is what ourings are.

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[SPEAKER_18]: But this other company, when they go use non-gap, it's the different process.

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[SPEAKER_18]: It's a different way of getting that number.

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[SPEAKER_18]: So unless you dig into the details, you're probably going to get misleaded.

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[SPEAKER_18]: And so that's why we focus on this.

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[SPEAKER_18]: This is basically this lead.

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[SPEAKER_18]: That's a better way to say it.

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[SPEAKER_18]: Then you're going to be misled.

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[SPEAKER_05]: So I would stick with the cap.

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[SPEAKER_05]: You are listening to an invest talk best of caller questions compilation program.

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[SPEAKER_05]: Your comments and questions are always welcome.

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[SPEAKER_05]: Call anytime 88899 chart.

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[SPEAKER_05]: 888-99 chart.

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[SPEAKER_04]: Today I had a question on railroads stocks.

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[SPEAKER_04]: I just wanted to get your overall opinion.

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[SPEAKER_04]: I've heard people talk about them in a positive way, negative.

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[SPEAKER_11]: I'm just looking to see what you guys think about them.

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[SPEAKER_04]: You could just talk about why we're out real stocks or bad investment.

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[SPEAKER_04]: Just something to kind of help direct me on how I should be looking at these, if at all.

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[SPEAKER_04]: I'll be looking forward to hearing your answer on the podcast.

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[SPEAKER_04]: And thanks for always, guys.

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[SPEAKER_18]: I'm not sure where you're getting the idea that railroad stocks tend to be bad investments.

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[SPEAKER_18]: Actually, there's some of the best businesses in the world.

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[SPEAKER_18]: they have natural monopolies on a very efficient way to move goods through different nodes in their network.

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[SPEAKER_18]: Yes, they're all alternatives of shipping via truck or plane, but those tend to be very inefficient, especially when you're moving large quantities of products,

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[SPEAKER_18]: where, you know, there's, there's a large population.

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[SPEAKER_18]: And you go look at the profitability of some of these names.

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[SPEAKER_18]: I'm just looking at like Union Pacific, one of the largest out there.

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[SPEAKER_18]: The return equity right now is 41%.

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[SPEAKER_18]: And if I zoom out historically, it's basically, I'm going back to Charitable in 1998,

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[SPEAKER_18]: And to the early 2010s, the return equity is around 10 to 11% but it's been steadily rising and over the past decade or so, it's averaged 30-40%.

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[SPEAKER_18]: Now, we own a separate rail company, then UNP, but it's still very profitable.

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[SPEAKER_18]: These are consistent businesses.

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[SPEAKER_18]: Yeah, they tend to be cyclical, but once again, it's they operate an efficient service.

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[SPEAKER_18]: Yes, us flexible some of the other ones before the bulk of the move from, say,

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[SPEAKER_18]: Once again, most of them have very strong monopolies on different routes.

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[SPEAKER_18]: So I don't know where you're getting the idea that railroad stocks are bad businesses.

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[SPEAKER_18]: No, they're actually some of the most incredible businesses out there.

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[SPEAKER_18]: They're boring.

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[SPEAKER_18]: Sure, they are boring.

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[SPEAKER_18]: I get that.

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[SPEAKER_18]: That exciting is railroad.

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[SPEAKER_18]: It's old school.

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[SPEAKER_18]: But the trailing returns.

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[SPEAKER_18]: aren't credible.

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[SPEAKER_18]: I mean, if you look at your UNP 15 year total return 13% annualized, that's very good.

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[SPEAKER_18]: You'll look at, let's see, the name that we also a domestic railroad company, the 10 year annualized turn 19%.

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[SPEAKER_18]: So, yes, everybody should have railroad stocks on their

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[SPEAKER_18]: Another question, you know, a lot of them have good moments of now.

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[SPEAKER_18]: Part of this is higher oil costs.

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[SPEAKER_18]: It makes their service even more efficient or more cost-effective shall we say, because shipping via plane or truck.

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[SPEAKER_18]: So I mean, just got a lot more expensive.

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[SPEAKER_18]: So I mean, that more and more goods are being shipped by rail.

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[SPEAKER_18]: I love railroad stocks.

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[SPEAKER_18]: And let's go with a YouTube comment section question.

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[SPEAKER_18]: Samyam says, hello, Vestok, would like to get to thoughts and opinion on the recent SEC ruling change that effectively scrapped a minimum $25,000 pattern day trading requirement.

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[SPEAKER_18]: I see very little media attention on this and the argument is that it lowers the barrier for more investors.

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[SPEAKER_18]: Does this not make it riskier for investor, the investor, especially if trading on margin, how is that rule change beneficial to the market?

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[SPEAKER_18]: So usually that pattern day trading requirement is for retirement accounts, IRAs, Roth IRAs.

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[SPEAKER_18]: There's not really that issue with taxable brokerage accounts.

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[SPEAKER_18]: which is what you would need to be to take on margin.

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[SPEAKER_18]: So that I'll just address it in regards to those retirement accounts.

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[SPEAKER_18]: And I think the simple answer is, it's important to have some sort of safeguard for the average investor.

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[SPEAKER_18]: I don't think that it benefits markets in any way.

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[SPEAKER_18]: When I hear benefits markets,

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[SPEAKER_18]: To me, it's all about maybe creating more liquidity, more price discovery, et cetera.

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[SPEAKER_18]: And frankly, I don't see this doing either.

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[SPEAKER_18]: I see this as a much higher risk that investors will miss use it, especially in today's world with very get rich quick.

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[SPEAKER_18]: There's a lot of gambling.

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[SPEAKER_18]: There's a lot of day trading.

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[SPEAKER_18]: And to do that in an IRA or Roth IRA, just doesn't, I think benefit the end investor, who should be investing more for the long-term, because most traders, they, they flame out.

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[SPEAKER_18]: They don't have the discipline, they don't have a plan.

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[SPEAKER_18]: They just hear stories or they're kind of flying by the sea of the plants.

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[SPEAKER_18]: And that certainly is a recipe for disaster.

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[SPEAKER_18]: So if you see this change to me, this is more to do with lobbyists.

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[SPEAKER_18]: They want more trading.

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[SPEAKER_18]: They want to make a spread, especially high frequency traders.

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[SPEAKER_18]: And the Citadel is of the world.

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[SPEAKER_18]: They want more volume.

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[SPEAKER_18]: And they can make their extra little penny on, or tens of a penny.

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[SPEAKER_18]: And that's what this is all about.

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[SPEAKER_18]: This is not better for the investor.

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[SPEAKER_18]: It's not creating better price discovery to be frank, and so I don't like this change.

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[SPEAKER_07]: It's important for the listener to understand that not all comments made will apply to them.

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[SPEAKER_07]: Specifically, nothing said she'll be taken to be

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[SPEAKER_07]: or shell statements on this program be considered an offer to buy or sell security.

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[SPEAKER_07]: Thank you for listening, and your comments and questions are welcome on our 24-hour listener line at 888-99 chart.