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The talk station should have eight O five I fifty five KR see the talk station. Brian Thomas fishing everyone a very happy Monday. And it is Monday. It is eight oh five. It is time for Monday Monday with Brian James from All with Financial Brian James, Welcome back to the program, my friend, good to talk to you.
Good morning, good morning, glad to be here. Thanks once again for the opportunity to talk to you and your listeners. Well, the first topic's got me a little worried. Now, just because someone thinks it may happen doesn't necessarily mean that they're relying on car you know, concrete facts and information. But I'm a little frightened by fifty one percent of Americans worrying about a stock market crash, you know, as opposed to like a correction or a downturn or something.
But I mean a crash is a significant, like massive life changing ruining phenomenon.
Yeah, it all depends on how you to these things too.
Now, no, I would point out that none of these things, none of these forecasts are ever based on factual information, which is what makes them forecast. We never know what's coming. That's just these are just measurements of what mood are we in. So one of this is that a new study is out showing that fifty one percent of people
are expecting a market crash. I also would remind everyone that the same percentage of people were expecting the second leg down from the recession, the brief recession that occurred during the COVID period. Uh that was five years ago, and they spent probably two or three years waiting for that to kick in, and it never did. Thank We just talk about things until they happen or don't happen.
Thank you change that way.
You see, because you know there always is going to be some kind of downturn at some point. So if we keep the conversation going on for enough years that at some point you can say, see, I told you so exactly.
I've been talking about rain for the better part of a week, Brian, and look, lo and behold, I was right last night.
Go pick this all up. I'm no sure damas you kept this all up.
But some of the this, this expression of concern, I guess is predicated on the tariff situation, which I know we're going to be talking a little bit more about. But tariffs have got people a little spooked and jittery.
I mean, I've saw some really frightening statistics about the impact on car buying and how much it may increase the price of cars, which I know is on your short list of talk about today, maybe ten thousand dollars more, depending But it's you know, when you looked at the breakdown of what's in an American car, you know, American car made in Detroit, and you're like, actually, no, it's not. It's like forty to sixty percent imported stuff.
Just because the CEO's rear end sits in an office that is within the bounds of the United States doesn't mean that that particular company's cars are exempt. For example, teriff exposure for GM's about forty five percent, twenty five percent for Stalantis the artist formerly known as Chrysler, and about twenty percent for four. So even in US made cars,
about thirty five percent of parts are not compliant. With the US Mexico Canada agreement from a few years ago that Trump put in place but doesn't seem to like anymore. So the estimates rise from you know, anywhere around twenty seven hundred to five thousand dollars, maybe in some extreme scenarios like you mentioned, ten thousand dollars in the added costs of paying for these arguments. Now, the thing to look at though, is these aren't supposed to kick in
for a couple of weeks. These are still negotiating tactics. Maybe something changes between now in April second or third whenever they's actually kick in, but remains to be seen.
Yeah, I'm keeping my fingers crossed that the scenario does change, and maybe whoever he's asking for something from will capitulate and give it to some of Trump's terms and that we won't have to go through the tariff struggle because you know, I mean, you know it, I know it. They're going to make the price that things go up. There's just there's nothing you can get around that, whether
they're fair or not, I mean reciprocal. I understand the fairness argument, because we're having our things subject to tariffs over on their side of the ledger of whatever country is receiving them and slapping the tariffs on. Why they're doing that, I don't know. The genesis or basis behind any of it. But you know, if this isn't trying to create an even playing field, that argument at least passes Mustard. But you can't get around the practical effect
that they're going to make things more expensive. So and that's we don't need that right now, Brian.
That is not helping, of course, no, But well I would throw out there though, if you one interesting thing I've noticed over the past couple months, because I've noticed my phones haven't ranged very much.
People aren't too spooked by this.
Some of it is because there's a decent amount of people out there who feel that the person in charge right now is exactly who they wanted and this is just the pain we have to go for we have to deal with. But other people are simply looking and I would say most people are simply looking at their investment statements. If you are sitting on a properly diversified portfolio,
you're not down that much. Because where the United States is proactively making changes to present ourselves differently to the world, and the overall economic situation on this planet that is causing so some of this is pretty much self inflicted. We're gonna grumble about tariffs and all these well, then yeah, the stock market's going to get a little squirrely. That creates an opportunity for other places. So therefore, as we're sitting here right now, the S and P five hundred
is down about five percent for the year. The Nasdaq is an official correction territory, down ten percent a year.
Today.
International stocks, which I've spent the last ten years trying to convince people not to dump, are up nine percent. Our merging market funds are up about four and a half percent. So if you have a diversified portfolio, you're probably about even for the year. Despite some of the scariest, craziest, most unsettling headlines we've seen, so mostly the market is quiet.
Well, you know, it's interesting you put that in the context of your phone not ringing very much, because, as you pointed out so many times over the years, your phone will ring a lot when it hits the fan. In some way, you got a you know, precipitous drop and the S and P five hundred or something. People get all wigged out and like, should I sell? Should I sell? And that's what you're You're a counselor, as a financial planner, you're you're a talker off of a ledge kind of guy, exactly.
And that's what we talk about. We talked about how are we going to deal with these things? And then we also put it in context of history. Something else I've been boning up on is what happens, what has happened during some of the scariest historical times we've had here and then the next closest one. And I don't mean to prognosticate anything here, but World War II obviously was a reshuffling of the deck in terms of how
the world gets along with each other. Nineteen forty one, the S and P five hundred was down somewhere between ten and fifteen percent. That was when we first stepped into that fray, and the unknown became the talk.
Of the day. We have no idea what's coming out of this.
Nineteen forty two, forty three, forty four, and forty five were each up a minimum of fifteen to twenty percent. So if you own stocks through that entire period, you did just fine. You weren't comfortable, you weren't happy, but you didn't lose money.
I did not know that. That's interesting.
It's kind of mind Bob and think about it, because all that means when wherever we have craziness, we don't root for this stuff. But generally speaking, American companies historically have been the best ever at figuring out about how to profit off of something. So remember the stories from World War Two about how factories pivoted to making instead of cars, they were making tanks. Instead of creating tires, they were making treads for the equipment we needed overseas.
It's just a catalyst the market will pivot to wherever the profits can be made. We saw the same thing when COVID kicked in and everybody had to go out by a second set of computers to take home so we can all work from home. We all never heard of zoom before. Now zoom is pretty much ubiquito us. I'm looking at you on it right now. These are just catalysts that create an opportunity for somebody to make money.
Yeah, And I guess the other component is when Trump announced these tariffs. And I'm not sure there's a direct straight line you can draw, but a lot of very major businesses, you know, large, you know, multi billion dollar companies, including autobile manufacturers. So they're going to start moving some production here, and that's exactly the point Trump was trying
to accomplish the return of American manufacturing jobs. And maybe it'll it'll bear I guess the question is when you look at the component parts of these American automobiles, as we just talked about, can we get those component parts to return or be manufactured here, and if so, how long would something like that take.
And how long will it or how much will it cost?
As you always point out that we are an expensive place to produce anything because we've got an awful lot of rules and things in place.
Some of that is being dismantled right now. You know.
There were some announcements made over the weekend about some steps he's taken to weakened unions, some first shots fired across the valle at the labor market here in the United States.
That's not necessarily going to.
Go well because a lot of those people were his supporters and they're having some of the rugs pulled out from under them. But if we're going to manufacture parts here, and this is all about making the United States more profitable, he's got to look at the cost of good soul.
What does it cost to produce this stuff?
I just bringing the jobs back on shore isn't the only step that's true. That is true, and we know all day long it's impossible to eat even the playing field from a production cost standpoint when you are dealing with countries that have just practically dictatorial control over the working conditions, and quite often they're poor and the people do not get paid very much. So that in and of itself is kind of a it's it's a drag
on doing business in the United States. That's why everybody moved over to China for so long we can give you embraced China as a trading partner. They have inexpensive labor, and they're welcoming. They're happy to open manufacturing facilities and get that the skids greased for that. And then next thing, you know, we find that we're not making anything here.
When it all hits a fan, like during the pandemic that was a frightened the cold water does to reality, I think I'd rather pay more for something knowing that it was made here and that we have a steady supply of it. You know, then I have to rely on what might very well be our arch enemy in a conflict to make it yeah, I think philosophically you'd
have a lot of people agreeing with that. But on the other hand, the market and the price of any given stop is based off of how profitable can that company.
Be going forward.
Philosophically, we can say, yeah, I want to buy stuff from here, but that's going to have an impact on the price as well.
All right, well we'll stop contemplating our navels. We'll bring and Brien James back talk a little bit about futures dropping among the tariff hears and people. I guess from a good stand thing they're adding to their rainy day fund, which I'm going to guess Brian James thinks is a good idea. More with Money Monday's Brian James, after I mentioned my dear friends at Budd Herbert Motors, get in touch with Bud Herbert for all the lawn equipment you need.
They have the best. They only carry world class brands John Deere. They got x Mark mower, Steel handa power equipment. That's where I got my professional level Honda push mower. Last one will ever have to buy. It's built that well, said the Herbert family. You will be working with a Herbert family member so they're going to make sure you get the right piece of lawn equipment that you're looking for.
There know everything there is to know about the equipment that they sell, delivered to your door, and they service what they sell. You can't get that kind of service from a box store. And I had a terrible box store experience, which is why I'm so pleased that good friend of mine steer me to Bud Herbert Motors, and that's why I'm blessed to be in a position to steer you to Bud Herbert Motors. Tell the Herbert family. Brian said, Hi, when you get in touch with him,
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One fifty five KRC are your nineteenth fifty five per CD talk station.
Brian Thomas Swift All Work Financials Brian James doing Monday Monday, continuing our discussion a little bit about futures here. I just pulled up the Wall Street Journal's web page and DALs down about zero point sixty seven. Future wise, it looks like one point down for SMP five hundred NASDAK about almost a point and a half. And the headline upper left hand corner global stocks slump as concerns mount over US tariffs.
Brian was he not there anymore?
I don't see his little photograph in the in the pickup or the box there, Joe, Okay, he's not there. He disappeared, Brian James went running and hiding. I don't know what happened to him anyway. Apparently US savings rates wrote in Rose in February, for the second straight month, Americans rebuilding their rainy day funds after the holiday shopping season. It's the article that he provided me for my insight
in your edification. Savings rates jumped four point six percent last month from four point three in January and only three point three in December. They say a low savings rate usually means consumers would have to reduce spending at some point to rebuild their savings, which slows the economy. So the current savings rate below normal, but not excessively. So arranged from about five to six percent in a
decade before the pandemic. So and I've always heard that you know, from a financial standing plan point, you know, try to sock away some money to cover you for the rainy day. You never know when it's going to hit. I had a friend of mine just lost his job the other day. I think it was unanticipated, but it does happen. So making sure you have some money socked away,
and I'm not sure the amount. One of the things I wanted to ask Brian was how many months worth of daily savings or our money you should have socked away in that savings account. Anyhow is that him back again, Joe, you're trying to get a hold of him, all right, Well, you kind of got me off guard. I know it's not your fault, Joe, because he just kind of disappeared but left me without a topic. So I thought we'd
be filling up this half of an hour anyway. One thing I did when I get to since we were talking about Democrats and their policies and not seem to be able to articulate any strategy to deal with Republicans other than scream and yell and pull their hair out over really things that don't make any sense. Kind of a theme this morning. On the heels of that ridiculous Tesla protest. Elon Musk isn't a fascist, it's definitionally, he's the polar opposite of it. Brian was talking about that
reducing rules and regulations. That's what stagnates an economy. It slows it down. And those rules and regulations are telling you how to run your business. That's what fascists do. So when you've got an administration that's in there that's doing its best to get rid of the burden of ridiculous regulations, you are dealing with an administration that is the polar opposite of fascism. So get your definition straight and try to make some sense of why going after
Elon Musk and Tesla's makes any sense whatsoever. I Brian you there.
I was looking at you and hearing you the whole time, and we just got done talking about how great Zoom was and what a catalyst it was, and then here we go. So I think that I'll take the faulter jinxing.
Then I go, that's okay, I'm glad he came back.
I just getting rid of launch into another discussion about the politics where we find ourselves. But as I was mentioned, thinking we were going to be talking about the global stock slump, concerns mount over US tariff. Just an update on the Wall Street Journal. Across the board, you know, futures are down. The worst down right now is NASDAC at one and a half, but the rest of them are down about a point, maybe a little bit under dal Jones Industrials this point seventy three.
So this is just.
Didn't they factor in the market already that these these terrifts are going to kick in?
Brian, Yeah, and that's.
Why we've seen the volatility. Remember, we get we're having lately, we're having about two days of down one percent, you know, down one one and a half percent, and then we'll be down three percent, and then we get a chunk of it back because the market will decide that there's something out there, some shiny object that it likes, and it'll bring it back. So we are anticipating these these tariffs kicking in, and then we are celebrating what it
looks like they're not going to kick in tomorrow. At some level of this, Brian is going to be saber rattling because it is a negotiation tactic. Remember what Donald Trump thinks, he's the best in the world. At that's making a deal. So a lot of this is I'm going to do something terrible to you in a month unless you act the way that I want you to act.
And in some cases he's getting some concessions there. Remember our first, very first discussion about this, probably a month and a half ago, where the tariffs that they were going to levy against Canada that went away overnight, became something else as the negotiation continued. But the way he stated it at the very outset of the discussion is very different from what's happening now. So some of this
is savior rattling by both sides. No country on the face of the earth can afford to completely seclude itself from the rest of the world. Now that every every company's customer base is the entire planet, So there won't be any endgame of we are just going to take our ball and go home and only sell to American customers. That is not possible.
Right of one of my favorite movies, Casablanca, one of the lines isolationism is no longer a practical foreign policy, and I think that's certainly the case in matters of business, international business, and real quick I read the article in the savings rates have gone, people are like putting, you know,
replenishing their savings accounts. As a financial planner, is there a certain and I don't mean a dollar figure, but based up on one's earnings and one's living expenses, is there a certain number of months worth of money that is recommended to sock away just in case?
Yeah, And I think that's a great important discussion to have, And for people who are who lead really really simple lives and there's not a whole lot going on at the moment, I would a minimum of three months. I would say more like six months. If you've got kids and a mortgage in the mix, and you have two jobs, you know, two high paying jobs, that kind of thing, you might want to look at more like twelve months, because something crazy like that could have a significant amount
of impact on your situation. One thought I would throw out there. I believe personally the ideal savings rate is zero percent. The reason I say that is because it should have been planned for a long time ago, and if you've got that kind of money socked aside, you don't need to be putting more into it. So I have not changed my savings rate in probably two decades because we solved the emergency prone problem a while ago, and ever since then I focused on getting kids through
college and our retirement and so forth. I don't believe you need to put cash into your savings account every single month. If you're already there, it's just piling more money.
Aside, and it's not invested, I mean, other than bank interest rate, which we all know doesn't pay very much compared to what your yields might be in the market investment.
Exactly. I want to make sure people didn't hear me, did not just hear me say that you don't need an emergency point us to know what you need and then know when you've accomplished a goal so that you can move on to the next goal.
But that's if first order of business in terms of establishing a financial plan is to get that base amount socked away so you can then invest cam I write on.
That that is the oil in the engine, because we can do magic with the long term investments. But when the ship goes sideways, is it occasionally will you lose your job or you know, the stock market takes a chunk away A lot of times. Some of those that happen all at the same time, you have to have something to keep you afloat, or you'll have to dip into your long term savings, which probably are taking a bit of a hit at the moment. That what I'm
describing is pretty much happening right now. People are getting laid on and they're having to sell at a loss to cover the bills because they didn't have an emergency fund.
And then there's you know the danger of having to pay you know, the taxes and the penalties and things like that by tapping into your four toh one k. So try to avoid that, get that savings padded really well, and then you can exhale and just watch your investments grow. Brian James, Monday, Monday, I appreciate all worth the financial loaning you out. Sorry for the glitch there, but we got back on track and got the information out for my listeners. I'll look forward to talking to you again
next week. I hope you have a wonderful a week, my.
Friend, have a good week talking next Monday.
Eight twenty seven fifty five KRC the Talk station, don't go away, Local stories. Maybe take a couple of phone calls before we get too Ira Melman, who's going to do a Borders and Immigration empower youse seminar. He's joining the program at eight forty. Looking forward to him and him on the show.
Be Right Back fifty five KRC