When I wake up in the morning long and the sunlight hurts. Oh yeah, welcome folks, if you're just waking up. I can't thank you enough for tune again. I am Stephen Bouchet, not one of my capable colleagues, but myself your host, Stephen Bouchet, certified financial planner, founder of Bouchet Financial Group, and we are proud to be a fiduciary. A lot of people don't realize what that means. In a nutshell, that means all we care about is what's right for our clients first and foremost. So here
we are March twenty fourth. How does that Springfield to you? Now? You know, a little dust in the snow turned into a real mess. A lot of people are just suffering in upstate New York. And let's hope that we get the power back on and roads cleared and no more tragedies. This isn't what spring is supposed to be like, but it is, so once again, thank you for taking time out of your morning to tune in. Hopefully I can get you pointed in the right direction, whatever direction that
may be. I promise I'll give you my honest opinion. Helping clients for thirty six thirty seven years now, I am sure that I can get you pointed in the right direction. You may not always like what I had to say, but I'll tell you it comes from my heart, and it's my best professional opinion that I can possibly provide. The phone mines are open. Zach Harris, my long term producer, is ready, willing and able to
get you up so that I can talk with you. The phone mines are one eight hundred talk WGY one eight hundred eight two five five nine four nine. One eight hundred eight two five fifty nine forty nine. Any questions whatsoever, folks, any questions whatsoever, give me a call, anything pertaining to your financial future. One eight hundred eighty two five five nine four nine. So yesterday we had a great show, busy show. I didn't get a
chance to talk too much because we had so many callers. I actually like it. Like that it allows me to really answer some good questions. And I, as I said, the one caller yesterday, and we had some great questions yesterday. There's somebody listening that will be thankful that you asked that question. One eight hundred eighty two five five nine four nine. And you know, it was a red hot week. We talked about that, a red hot week. You know, the stock market was was was was,
was was good. You know, the s n P five hundred up two point three percent, NASA composite two point eighty five, QQQ almost three percent, even the Russell two thousand was up one point six percent. You're today folks, the S and P and the NASDA composite are all just under ten percent. It's a pretty good start for the first quarter. Heck, you know, if we can do ten percent in three months, can you imagine
what we can do in twelve months. And after the Fed came out on Wednesday, after their two day meeting Tuesday and Wednesday, basically Jerome pal confirmed they are committed. Seventeen out of nineteen board governors are committed to reducing cutting rates before the end of the year. That's great news for stock investors, Absolutely great news for stock investors. And it's going to be great news if you own bonds because there's an inverse relationship when they cut rates. Believe me,
rates are going to come down across the board. We went over the rates yesterday and pretty good detail. We talked a lot about laddering portfolios and so forth. And right now, you know, the ten year treasury's yielding four point two. When they start cutting rates, if that's under three percent, that means if you bought a ten year treasury today, that ten year treasury will be worth more money because there's an inverse relationship. When those yields
come down, the price of the bonds go up. Which is why I am as optimistic with bonds as I am with stocks, and I am optimistic with both. I think now's a good time to get your portfolio, you know, in tip top shape, whatever your tolerance for risk is. I know in our firm, we spend a lot of time educating our clients that they shouldn't be afraid of having stocks in their portfolio. Overtime, stocks have
been the best performing asset class, hands down. I don't care if you want to look at the last five, ten, fifteen, twenty ninety years, stocks have outperformed bonds, real estate, commodity, cash stocks. They come with some volatility, but every assa class comes with volatility, and if you're a long time, long term investor, you shouldn't shy away from stocks. I'm forever the optimist when it comes to the stock market. My personal
portfolio is one hundred percent investing in the stock market. It doesn't bother me when the stock market goes down. And I guarantee you that stock market will go down, it'll go down before the end of the year. You hear me. Give this statistic out often the average high to low, peak to trough swing in the stock market is fourteen percent in any giving year. You go back over the last forty four years, you know almost thirty out of
the forty four years were positive. You're gonna have some negative years, absolutely, but the average swing in the stock market is forty is fourteen percent. That's that's how much. That's what we call utility. I don't call it risk. I don't call it risk at all. When you look at the average, you know your S and P fifteen year average year in, year out sixteen percent. Folks, you earned sixteen percent year in year out. If you own NASDAC, it's even better, it's closer to twenty percent.
And if you own the bond proxy over the last fifteen years, your average return year in year out, it's two and a half percent. This is why we take the time to educate our clients that having stocks in the portfolio is not a bad thing. Sure, it'll bring some volatility, you'll have good days, bad days, good weeks, good months, bad weeks, bad months, sometimes a bad year. But over time, if you're a long term producer, stocks in the portfolio is not a bad place to be.
And this week was a great week in the stock market. It was nice to say, see the stock market too as well as it did. And you know, Friday, the markets were down a little bit. I'm getting tongue tied. Started out Monday. The Magnificent seven. You know who the Magnificent seven is right by now Apple, Amazon, the video Meta,
which was Facebook, Google, which is Alphabet now Tesla, Microsoft. The Magnificent seven accounts for so many of the returns that you have to just you know, if you didn't have those mega big boys in your portfolio, you did not have as solid returns as maybe everybody else who was invested in those big boys. And when you own the S and P five hundred, when you own Nasdaq, you own those big boys. You own the Magnificent seven.
Although some people feel that because Tesla's taking it on the chin, maybe Tesla shouldn't be part of the magnetficent seven. I said yesterday, this coming week, I plan on putting a little Tesla in my Sandbox account. Now I have never owned Tesla. I just feel that maybe I can nibble a little bit with it being down. Maybe it'll be a good you know holding for my Sandbox account, which is my play account. This is not my
core core portfolio. My core portfolio is invested just like my clients. But I'm in the one hundred percent equity model, so I'm very comfortable with risk. Believe me, when that market goes down, I could care less. I know it's going to come back, and I know it's going to go on to make new all time highs. The key is not to not to get nervous and sell out. So, you know, Monday, because in the video had their big event and the Magnificent seven, you know, we're
you know, tround the market, bonyields climbed. Then on Tuesday and Wednesday, as I said, the Federal Reserve came out. They kept interest rates unchanged on Wednesday, something that we knew. I felt that, but they reiterated that seventeen out of nineteen board governors will are in favor of at least two to three rate cuts before the end of the year, and if that happens, I think there's still more room for this market to continue going on.
On Thursday, you had Sales of a report that showed sales of previously owned homes up nine point five percent in February, the fastest pace in the year. Mortgage rates fell a little bit, were in the high six range, better than the high seven range, which is where we were not too long ago. Then you had the retailers on Friday. Lululemon, Athletica,
Nike all tumbled basically after retailers reported disappointing earnings. The good news on Friday was FedEx Jump and FedEx some feel is a bell weather for you know where the economy's headed. I'm going to take a fifteen second break. The phone lines are open, give me a call. One eight hundred eight two five five nine four nine one eight hundred eighty two five fifty nine forty nine. Thank you, folks for letting me take that quick break. The phone lines
are open. One eight hundred eighty two five five nine four nine one eight hundred eight two five fifty nine forty nine. Any questions, Any questions, whatsoever, give me give me a call. So you're to date, how did those Magnificent seven? Do you know? The As I said, the SMP is up nine point four percent. QQQ, which is the Nanstac one hundred pounds and is up nine point seven percent, so almost ten percent for
both. Their both go hand in hand. So the best performer year to date in the Magnificent seven is no surprise in the video up ninety percent. This stock just continues to just climb, and believe it or not, Meta Meta is up forty four percent. Who thought that Meta was going to be just you know, out of the picture. Meta has come a long way. A couple of years ago people had Meta for you know, basically going out of business. Meta's doing amazing. Amazon up about eighteen percent, Google
up about fourteen percent. As they said, the SMP is up about nine point four percent. You have Microsoft up about seven percent. The two dogs you know year to date, Apple down almost ten and a half percent and
Tesla down thirty one percent. Now I said yesterday, if you always wanted Apple in your portfolio, they got They got hit on Thursday four percent alone on Thursday because of the lawsuit bringing I think there's fifteen states, and you know a big brother, you know, the Attorney General of this great country of ours feel that Apple is not playing fair. They feel that they're basically
hurting their consumers and they're a monopoly. Well, god darn it. Apple has a good product, They have a loyal customer base, and they make a good I don't care if it's a phone, an AirPod, an iPad. I have them all. And guess what, I don't have to buy an Apple iPhone. So I don't know how they can say this antitrust suit is going to stick. I have choices. I can go out. I said it yesterday. If I searched long and hard enough, I can find
a BlackBerry out there somewhere. Maybe I can get it to work. Put a couple of blackberries together with a string in between them, maybe it'll work. So what's wrong with Apple creating a good product and having a good platform? Get apps and everything? So I have choices. I could get a Flip phone, I can get a Samsung phone, I can get any phone that I want. I choose to get an iPhone. So it'll take three
to five years for this lawsuit to play out. But Apple got hit Ard and I said yesterday, if you always wanted Apple in your portfolio, it's down, You're to date about ten and a half percent, and it's you know, it may not be bad putting it in your portfolio if you always wanted Apple. I still feel it's one of the best companies in the world. It's a solid company for a lot of good reasons. We have only two individual stockholdings in our portfolio. They happen to be Apple and Amazon.
So you know, we're okay with both of those, even though Apple has hurt us. If I go back, you know to January of twenty twenty three, you know, Apple Apple, you know, Apple, Apple did not perform anywhere near you know, because of this year being down. But man, oh man, last year, I think for the year, Amazon was up seventy five percent. Apple, I think was up about thirty four percent. You know what, Thank god they were in our portfolios. They
did well. Now in twenty twenty two we own QQQ. That hurt us a little bit, but that's okay. We know we're gonna have periods of time where we lag because our portfolios are kind of if I were to summon up growth oriented, so I'm not. I'm not concerned about Apple or Amazon being down on any given day. I like both holdings. They're in our portfolios and they seem to be doing pretty darn good. One eight hundred eighty two five five nine four nine one eight hundred eighty two five fifty nine forty
nine. Any questions, give me a call. So, as I said on Friday, retailers kind of down a little bit. The market as a whole on Friday was off a little bit. You had Nike shares dropping seven percent after they reported flat quarterly sales, Lululemons shares down fifteen percent after the CEO express caution about consumer demand. Maybe the consumers slowing down a little bit.
The consumer has been pretty resilient through all of this. The economy is doing really good, and we got a lot of people that are still working. The FED, thank god, did not did not get their way. Remember, and I hate to bring this up so often, but just to remind you, you know, the FED felt that unemployment had to go to five six percent because that's what the textbook told them. And I said,
I said it a year ago. This could be a different norm. This, you know, we don't need to go into a deep recession to bring inflation down, hiking interest rates like the FED did eleven different times, brought inflation down from nine point one percent to three percent. So it's the trend
line is going in the right direction. And guess what we did that without having unemployment b in the five to six percent range with millions and millions and millions of people out of work and pushing us into a deep recession where we all, we don't want to get out of bed because we hate that word recession. But we did not have any of that. And you know, who knows if we were in a recession or not. Go back two years ago we had two quarters of negative GDP growth. That was the old definition
of a recession. So I guess in a way we could say we were in a recession and we came right out of it. Four years ago in COVID, we had the shortest recession in history. We were in and out of a recession within weeks. So thank god, thank god, the Fed did not get their way. We did not have to go deep into a recess. So the you know, stock market on Friday just basically with the
consumer slowing down, these these reports from these retailers. And believe me, this is where the consumers out there, they are, they are shopping in these stores. And if these stores are saying that the consumers are slowing down, then then you know, that's a pretty good sign that maybe the consumers taking a little break. We had, you know, market all time highs
again this week. Wednesday, Fed Reserve chair Jerome Powell indicated that the Central Bank was still on pace to trim interest rates three times this year his words, not mine. And on Wednesday all three major indexes hit, it hit hit new records, and they did it again on Thursday. So as I said, it was nice the SMP for the week up two point three percent. Now, Zach, for the week almost three percent. That was nice
to yield on the ten year Treasury note four point two percent. You had Reddit come out, ipo redd it came out, and you know, came out. I think at thirty six dollars a share in at the week at at fifty four dollars a share, maybe it was forty six dollars a share. Where where did where did Reddit? And the week, Zach, I think it was fifty four dollars a share. I got to hear somewhere in her interchanging the numbers. But anyway, Reddit had had had a good week,
you know for an IPO. Everybody was was watching at IPO one eight hundred eight two five five nine four nine one eight hundred eight two, five fifty nine forty nine. If you have any questions, give me a call, let me, let me kind of give you my take on it. Get you pointed in the right direction. So you know, Apple's you know, being attacked by everybody. The Justice Department sued Apple on Thursday. That's why Apple was down four percent on on Thursday. If you missed that news
and you were wondering why your Apple shares were down. Basically, basically, the Justice Department said, Apple is a monopoly. It runs its iPhone business in that way their words, The Justice Department said, we alleged that Apple has employed a strategy that relies on exclusionary, anti competitive conduct that hurts both consumers and developers. That comes from Attorney General Merrick Garland's mouth, and basically,
you know, he announced the lawsuit in the case. European authorities are cracking down on Apple's app store, So Apple's getting it each and every way you got Apple losing sharing the Chinese market due to grown competition and reports of you know, basically China not not favoring Apple. There. Apple's thinking about going to other countries like Vietnam, India to make some things. Can you blame them if they're not wanted in one company, They got a pretty powerful
product. They can go to really any company, any company they want. So, you know, we have Apple down ten percent year to date, and as I said, I still believe in Apple. This lawsuit could be three to five years. We'll see what happens. The Apple and Tesla are the only two of the Magnificent seven that are down year to date. Tesla not to repeat myself, but Tesla's down about thirty thirty two percent, And that's why I'm thinking about adding it to my sandbox account. Who knows what
will happen with it. It's just a play account. If I lose, if I lose money in Tesla, hopefully I'll make money and Apple. I got a lot of Apple in my sandbox account. I'm I'm happy to say. I beginning the year, I bought healthcare and small caps, and I leveraged both. I believe in both. I think when this market breaks out, You're going to see more of a broad rally. That means that more mid caps and small caps will do better than they've done, and it won't
be just the big caps that are that are doing well. One eight hundred eight two five five nine four nine one eight hundred eight two five fifty nine forty nine. If you have any questions, give me a call. Yesterday I talked a little bit about our website. We we go to great lengths educating our clients. We put out what I think is just some phenomenal content. I have twenty professionals that I'm surrounded by, and they're they're they're there
second to none in the country. I think one of the reasons why Charles Schwab has us in the top three to five percent of all wealth management firms. They look at like one hundred different factors that they measure us by. I think one of the reasons that we do as well as we do is the professionals that I'm surrounded by. I have. I have a team that's second to none, and just I'm so proud of them. We're coming up
to the bottom of the hour. That means we have to take a news break you're listening to Let's Talk Money, brought to you by bouchetf and Answer Group, where we help our clients prioritize their health while we manage their wealth for life. If you have any questions, give me a call. One eight hundred eight two five five nine four nine. One eight hundred eight two five fifty nine forty nine. The phone lines will be open during the news break, and I'll be here on the other side of the news break.
One eight hundred eighty two five five nine four nine. When I wake up in the morning, long and the sunlight hurts my something without water loved heavy. It's really a good song when you think about it being so early in the morning. What else is there to do today, folks? You can't go out and practice, you know, your your chip shots on the golf course. That was last weekend. Spring came in between, and here we are blanketed with some snow. It's crazy. The weather is crazy, but
the phone lines are open. One eight eighty two five five nine four nine. I can't I can't not just say this because I'm a fan of the royal family. Yeah, I think you know. Princess Kate Middleton of Wales you know, coming out and letting the world know about her cancer diagnosis is just devastating. I was I was shocked. I said yesterday on the show How I Went Public, and you know, got a lot of responses on Twitter last week. I felt that, you know the world should just leave
you know, Prince William and Princess Kate alone. What it's none of our business why she was out of the limelight. She went through, you know, some surgery early on in the year, and it's really none of our business why she was out of the limelight. And you know, she came out on Friday and she told us why she spent out of the limelight, and it was a you know, I give her so much credit to courage to announce to the world and she you know, well she's now part of
that cancer club. That illness. That doesn't discriminate folks. It doesn't matter whether you get dressed up for work or you're able to work in a T shirt and jeans. It doesn't matter whether you drive a nice car or take a bus to work. It doesn't matter who you decide to love the color of your skin, the church or temple, or what your faith is.
It doesn't matter. Cancer does not discriminate cancer, can't. I think everybody listening probably knows somebody in their small circle of family or friends or co workers that has been affected by cancer. And cancer doesn't go away. So I give Princess Kate Middleton so much, so much respect, and so much love, and she will get my prayers that she's able to overcome this cancer.
Hopefully her she had admit it, her chemo treatments will will just squash it and make it disappear, for her family's sake, for the world's sake. I think. I think Kate and William are two pretty dynamic people. But I felt the same way about Prince William's mom, Princess Diana. I felt she was a pretty spectacular individual as well. And the poparazzi just, you know, just would not leave her alone. And the poparazzi just would not
leave Princess Kate alone during this trying time. I can't even imagine here she is. She has three little ones that you know, dealing with this. So my heart goes out to Princess Kate and I will be saying a lot of prayers for her, and I hope she recovers and recovers sooner then later. And everybody who has cancer out there, if you're listening or if you
know somebody, my heart goes out to everybody who has cancer. We've been affected by cancer my family, and it's it's it's just, you know, it's something that just pops up, doesn't matter, there's no rhyme or reason. One eight hundred eight two five five nine four nine are the phone line is open. One eight hundred eighty two five fifty nine forty nine, Give
me a call. I'd love to talk to you. You know, every once in a while I talk about target date funds and how I'm not a fan of target date funds, and let me let me say once again this morning, I'm not a fan of target date funds basically, and there's a lot of money. Listen. Target date funds there. They're in just about every four oh one k. They can't kind of pop up because so many people weren't sure how to invest their four oh one k dollars. They just
maybe they didn't have the sophistication or time to put into teaching themselves. So target date funds popped up. And basically, if you think you're going to retire. You know, in the year twenty fifty, you can buy a target date fund that is called Believe it or Not twenty fifty, And that just means that as we get closer to the target of twenty fifty, what happens is like, right now, that target date fund will have more stocks
in it than bonds. But as we get closer, as we get closer to that target date fund, you know that that that portfolio will will be more bonds and conservative. If you look at the Vanguard twenty fifty fund right now, you know it's about fifty four percent US equity, thirty five percent
foreign equity, and only ten percent fixed income. You know the performance of that Vanguard fund, you know, year to date we're up six point thirty nine percent, whereas the S and P is up nine point four The fifteen year average is twelve percent year in year out, whereas the SMP is sixteen percent year in year out. So that's kind of what the target date fund looks like. And if you look at the let's say target date twenty twenty
five fund, it's going to be a whole different picture. That means the target date is really next year. And when you think about that target date fund. Year to date, it's up three point five percent, and the fifteen year averages, believe it or not, just under ten percent. The portfolio of that, you have thirty one percent in stocks, twenty percent in non US stocks, So I'm actually kind of surprised. It's almost a fifty to fifty portfolio. So Vanguard did a good job here with their target date
fund fifty to fifty portfolio, a lot of international investments. If I look at the Fidelity, you know, target date fund, just to give you an idea, because there's no rhyme or reason, the Fidelity fund has about fifty two percent split between US and foreign and about fifty percent fixed income, so it's it's managing their target date fund similar and you know you're to date it's up about four point one three percent. So what are the pros and
cons of these target date funds? And there's a lot of money going into them, about three point three trillion dollars in target date funds, and they make up a big part of four own case because they're they're they're easy, but there's no rhyme or reason. Fidelity, t o Price, Vanguard, Schwab, they could all manage their target date funds differently than the others.
It's basically just the mix of stocks and bonds, and as I said, it becomes more conservative as the uh they're nears that target day fund of retirement, and the funds are typically offered, you know, in five year increments, so for the most part of the be twenty twenty five, twenty thirty, twenty thirty five, you get the picture. The big advantage of the funds is that they do the heavy lifting of basically adjusting the portfolio. As
I said, the twenty fifty fund had ninety percent stock. The twenty twenty five fund has about fifty percent stock. So as you get closer to that target day fund, these companies will trim and you know, bring in more bonds to have the portfolio be be you know, more conservative. But I always remind the listening audience that even when you retire, and if you're fortunate enough to retire early, you got twenty twenty five, thirty years that you're
living through retirement. So just because you plan on retiring, you don't plan on dying. And that's why I'm not a big fan of the target date funds, because if I'm a growth oriented investor. If I want that eighty twenty seventy five twenty five mix, and I want that, you know, till I decide to change it, then I would rather have a lifestyle fund that keeps me in that eighty twenty seventy five twenty five mix until I decide to change it. So that's the difference between a target date fund and a
lifestyle fund. Most fur ow and keys have the option of both. And I'm just not a fan of anybody reducing my risk until I'm ready to reduce my risk. And we have a lot of retirees, a lot of retirees that are invested in our growth strategy eighty twenty because they're comfortable with it. We keep two years worth of their cash needs off to the side, so we protect them. That's our safety net, our insurance policy that when not if folks, when that next correction, when that next bear market, when
that next recession comes, our clients don't panic. They know we've protected them and we can ride it out. We can continue to manage the portfolio because the money that they're living off of is set aside, or maybe they have a goal, it's set aside. So when the stock market goes down ten to twenty percent or more, they don't panic. Our clients know that we have them protected. We have one to two years worth of cash needs off
to the side. So with the lifestyle fund, you can you know, if you're comfortable being eighty twenty knowing that you have two years worth of cash needs, why not. I gave you the statistics over the last fifteen years, which includes three recessions, three bear markets where the market was down twenty percent or more. Your average return in the broad stock market index is,
you know, sixteen percent a year. If you're invested in in QQQ, it was twenty one percent a year, twenty one percent a year compared to bonds being two and a half percent a year. So if you're willing to take risk and you're willing to write out the next correction the next bear market, having stock in your portfolio is okay. So that's the big difference between dark target date funds and lifestyle funds. I would rather see you in a
lifestyle fund until you're ready to kind of pull the trigger. Maybe you go from being a growth oriented investor down to a more balanced investor where you have that sixty forty mix or fifty to fifty mix, and you do it on your terms. That's the big difference with the target date. The target day as automatic, but the target date was a beautiful thing for a lot of furrowin k investors that just didn't know how to shape up their portfolio. The
other thing that I don't like about target date funds and lifestyle funds. As you know, if you've listened to the show, we are not fans of the foreign stock markets. And believe me, I can give you a host of reasons why we should be moving some money in the you know, into the European sown, the UK, Japan. I can show you pe ratios where they look more attractive than the US stock market. But our returns in this great country of ours, we're exclusively invested in the United States. We've
done really good. We've been out of foreign investments for quite some time. I haven't missed having them in the portfolio. Just you know, I don't care really about do I invest in Brazil, Vietnam, do I invest in the Eurozone? If you look at the rest of the world. Vanguard has a nice ETF that looks at the rest of the world excluding the United States.
So every country around the world, the fifteen year average is half of the S and P half fifty percent return of the S and P over the last fifteen years eight point three two percent for the Vanguard All World x US. That means the United States, the SMP is not part of that index. So every other country around the world eight point three two percent compared to
the SMP sixteen percent year in, year out. And if you break it out into emerging markets, and you know, the bear bell weather for emerging markets is really the Ice Shares MSCI emerging markets fifteen year return year in year out gets worse five point eight percent compared to eight point three for the rest of the world and sixteen percent for this great country of ours. And there
there, there you have it, folks. That's really the the you know, the difference of investing in this great country of ours and internationally, so with target day funds and lifestyle funds. I gave you the statistics. They have a huge weighting in those international holdings. It's just, you know, it is what it is. They feel that modern portfolio theory at one point one is you got to be diversified across all all all facets of of the world. And it's just you know, listen, it's just it's it's it's
different. The United States used to make up God the most the biggest part of our world GDP. Well that's not the case anymore. The United States is really you know, we we have on our GDP is you know, depending on how you measure it, folks, this is a number from twenty twenty two, about twenty five trillion dollars. China is almost eighteen trillion dollars.
Germany is number three at four trillion, Japan about four point two trillion, India believer it or not is up there with three point three in the UK three trillion. So obviously this great country of ours, and for twenty twenty three, it's that the numbers are similar. We're still number one, still number one, but now we have if you look at the world, we have about a twenty five percent share of the world, China has about
a seventeen percent share of the world. Germany has about four point two percent share of the world, Japan four percent, and India three point five percent of the world. So we're still number one. But there was a day when we were a whole lot more than just twenty five percent. The rest of the world is catching up. A lot of these emerging market countries are really growing, and you know, China's a force to be reckoned with. That's why when when you hear news about China and you wonder, what does
it matter. You know, China represents about eighteen percent of Apple iPhone sales, So when China's sales are down, that hurts a company like Apple big time. China had eighteen trillion dollars compared to you know, the United States almost twenty six trillion dollars. That's that's that's big, folks, that's big. Now. Sure, it's great that we have, you know, twenty six trillion dollars GDP gross domestic product, but we also have thirty four trillion
dollars of debt. That means, if you cash in all of our assets, we are in debt. We have what they call a deficit. You know that that that poor trillion dollar grew when President Bush, you know, and when when President Bush was in office it was five trillion dollars. We
grew our debt from five trillion to thirty four trillion. Then it doesn't matter if it's a Democrat or Republican in office, the debt grows because nobody in Washington is willing to wrap their arms around getting us to be more financially prudent. Let's say we have entitlement programs that are you know, that can choke a horse. We have interest rate debt. Now, remember when the ten
year treasury was yielding, you know, less than one percent. The the amount of interest we were paying out in this country was a whole lot less than the amount of interest we're paying out now. Now we're paying out four point two percent. A few months ago it was five percent. So you know, there's a lot of things that add up to that that thirty four trillion dollars worth of debt we have, and somebody in Washington there has to be a day when when we try to rein that in and you know,
instead of having deficits year in year out. In a nutshell, folks, if your household income is fifty thousand dollars, but you're spending fifty five thousand dollars a year, you're borrowing five thousand dollars on credit cards, taking it out of the equity in your home, or borrowing from a loan shark on the street. You're spending five thousand dollars more than you're bringing in, and that's a deficit. Well, that's what this country is doing. But the
numbers are a whole lot greater. You know, there's twelve zeros in a trillion, so we're thirty four trillion dollars in debt and our deficit is is just mind boggling. Yere in year out. We need somebody in Washington. I don't care if they're a Republican or Democrat. We need people in Washington to start paying closer attention I think to our our financial picture in this great country of ours. One eight hundred eight two five five nine four nine one
eight hundred eighty two, five fifty nine forty nine. Any questions, give me a call, Love to talk to you, love to get you. You're pointed in the right direction. We have on Friday a big report that the Fed looks at is the Consumer Expenditure Price Index, you know, basically PCE index. And last week we had the CPI that that came in a little hotter than we were expecting. And why does the Fed look at one
over the other. You know, they both measure inflation right. The Consumer Price Index and the Personal Consumption Expenditures Price Index two of the most widely used measures for tracking inflation in this great country of ours, but they differ, and they differ. The CPI measures the average change over time and prices paid by urban consumers for a market basket of goods and services that focuses on out
of pocket expenditures by households. But the Feds preferred, you know, take on the on the economy and where inflation is headed as the PCEE and that basically has a broader scope, including not only what households pay out of pocket, but also what is paid on their behalf by employers and government such as Medicaid Medicare. So PCE covers all consumption expenditures by households and non profit institutions
serving households. So the Fed feels that the CPE is just obviously a broader measurement of inflation, and it just you know, when you think about the CPI, it includes a fixed basket of goods and services, which means it does not account for changes in consumer behavior or substitutions that consumers may and response to price changes as quickly. PCE uses chain type Index, which allows for changes in the consumer basket over time, reflecting consumers tendency to substitute cheaper goods
for more expensive ones. And this happens especially during tough times. All of a sudden, instead of buying a name brand this or that, you may be buying the generic brand of this or that. And this makes the PCE a more dynamic measure that more accurately reflects real world consumer behavior. So that's what the FED looks at, and that reading comes out on Friday. Let's
hope that it comes down a little bit. Let's hope that it doesn't show that inflation is hotter than we want it to be, because remember, inflation is a moving target. The FED looks at these reports month in, month
out. Every month, they look at different reports, this being one of their favorite reports to look at. That's why Friday will be an important report to keep our eye on and if the FED sees and the FED is happy, Jay Powell said on Wednesday, Listen, there was a couple things that happened in January and February, and I give them credit for admitting that. They admit to the fact that there's a couple you know, bumps in the
road. That may be the cause of inflating tick higher than what was expected, But the trend is coming down and that's what the FED looks at. That's what the FED wants to see, is the trend coming down, going in the right direction, and that's exactly what's happening with inflation. Inflation is absolutely going in the right direction. So this report on Friday will be big,
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