January 31st, 2026 - Year 11 is in the Books!

In this lively financial radio show, hosts Steven and Adam Van Wie, along with Joey Loss, engage in a dynamic discussion about the week’s market turbulence, AI’s impact on software sectors, and potential tax changes. They offer insights into selecting suitable investments, underscore the importance of a competent financial advisor to avoid common pitfalls, and debate proposed legislation aimed at incentivizing older adults to sell second properties. The trio also humorously navigates topics like California’s potential vehicle mileage tax and the future of personal assistant AI technology.

Transcript

Steven H Van Wie 0:00

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

Adam Van Wie 0:05

I'm Adam Van Wie.

Joey Loss 0:07

And I'm Joey Loss.

Steven H Van Wie 0:08

Full house today, people, so stick around and listen up. Lots to talk about as usual. But first, welcome everybody, all you regulars that are always here. We are Today concluding our 11th year of doing this program. And next Saturday, we will start year 12. Now, that is hard to believe probably for listeners as well as us, but it's absolutely true. So I get to tell my first. My story of the first show ever, because I always do that on the anniversary of that show and I love telling it. So anyway, the regulars, you keep listening, we'll keep being here. Year 12, right on the horizon. New people, if you just got onto us by accident or if somebody told you about it, try to stick around for the hour because we promise you, you'll learn something somewhere along the line. And of course, the lines are open. 904-222-8255.

Steven H Van Wie 1:03

If you call in, we'll change the trajectory of the show to what you want to talk about. And please always remember, there are no dumb questions if there's something you don't know, there are a lot of people out there who don't know it either. And there are no questions too easy. Because as I remind you at least every few months, your job out there is to make the hosts look good. So the easier the question, the quicker we get a great answer and we look good. That's exactly how this can work for us and you. But if you got tough ones and we don't know, and it's unlikely that we would not know, but we will always get back to you on next week's show if you stump the band here. So just don't be afraid. We don't bite. Pick up the phone and give us a call. Another interesting week in the market, but an especially interesting day yesterday when some things happened that are, I guess, unusual.

Adam Van Wie 2:00

Yeah, yeah, definitely. It was a wild week. And I'll get to that in a second. But I did want to mention, for those of you lately, our podcast numbers have been up pretty substantially. So for those of you listening on the podcast, we really appreciate it. Tell your friends about it if you enjoy it. And we're available on all the major podcast platforms, Apple, Podcasts, Amazon, Spotify, you name it, you can find us there. We will, I guarantee you we will be the only Van Wie financial or Van Wie at all, that comes up when you search for it so.

Steven H Van Wie 2:30

Most likely right about that.

Adam Van Wie 2:33

Yep. So yeah, it was a bit of a wild week. It felt really terrible. And I think that was partially because the front half of the week was good and the back half of the week was not. And so it's somewhat of a recency bias there and then some other things that happened, especially in the precious metal arena that we've kind of been warning about for, for a few months now. No. If you listen to the show, you've heard us tell several times that this could happen and it did. But I was mildly surprised when I put the numbers together this morning. The S and p was actually up 3. 10 of a percent. Who knew? I would not have guessed that the Nasdaq was only off 2. 10 of a percent. And the Dow, which really came under fire with some healthcare stocks earlier in the week when everything else was doing well, I think it was the healthcare sector that was dragging it down that was off 4. 10 of a percent. So really not, I mean, just not nearly as bad as what I thought it would be when I put everything together this morning. The week started off fairly calm with the S and P seeing pretty nice gains on Monday and Tuesday. We Wednesday ended flat, but Thursday brought some volatility. The market was down pretty big midday, but it late rally really brought it back nicely. It ended up not down very much at all.

Steven H Van Wie 2:56

Don't say you weren't told.

Steven H Van Wie 3:53

Yeah, The Dow moved 695 points from the bottom to the top that day.

Adam Van Wie 3:58

Wow. I didn't realize it was that much. That's crazy. So, yeah, it ended up being not too terrible day. And then Friday rolled around and we really saw some more volatility.

Adam Van Wie 4:11

Gold and Silver really just took massive plunges on Friday. What? They were down over 10 and 30% respectively.

Adam Van Wie 4:20

And so like I said, if you listen to the show, we really thought when, when things go parabolic like Silver had in particular in any given time period, if it can go up that fast, it can go down even faster. And that's exactly what happened on Friday. Why did it happen? I don't know. There's a bunch of different theories, some. Some of it having to do with the new Fed chair that Trump appointed, who was very widely respected and actually got praise from both sides of the aisle. And to do that in 2026, you must be pretty well respected because nobody gets praised from both sides of the aisle.

Steven H Van Wie 4:56

But as a wise old man remarked exactly one week ago, anything that's unsustainable will stop the rise in Silver. The last several Months was unsustainable. It had to stop. Did I ever say it won't start up again? No. And I won't? I think the conditions for silver are built into every aspect of the economy. I don't know where it's going to have to correct two to start up again. But don't think this is the end of silver. It's not.

Adam Van Wie 5:14

No.

Joey Loss 5:26

And I think just like with stocks, when we're near all time highs, if you invest in silver or gold right now, you should expect quite a bit of volatility. It's just the name of the game when you're near the top.

Adam Van Wie 5:35

But that doesn't mean that it has to go down from here either. It might go down from here, but it might not, right?

Steven H Van Wie 5:42

No. It's also not something where a young person like you guys should buy and hold it until you're my age either. It's a trading vehicle. You got to decide where the ups and downs are going to be within your comfort range. So buy it when it's low and sell it when it's high. That sounds brilliant. Yeah, I just thought about it.

Adam Van Wie 6:01

It's so easy. The, the problem with commodities is that they're designed up and down in price and it's based on demand and supply. So when commodities go up in price, say gold, people mine more gold. The supply gets increases and therefore that generally drives the price lower. And the opposite is also true. So, so that, that is the nature of a cyclical pricing in commodities. And that is true across almost every commodity that I can think of.

Joey Loss 6:02

Yeah.

Steven H Van Wie 6:30

We've been saying for years, especially in the oil market, the cure for high oil prices is high oil prices. The cure for low oil prices is low oil prices because consumers change their. Not only their preferences, but their actions and things tend to go back toward. Revert to the mean, I guess.

Adam Van Wie 6:50

Yeah, yeah, absolutely true. So just be be aware if you're a commodities investor. In fact, when you go buy the commodities basket on Schwab, it's the only thing that we buy that comes with a warning on it. Whenever you buy the, the, the commodities basket, it comes up and says you are buying a highly volatile basket of commodities. Please be aware that is not suitable for everyone or something to that effect. Yeah, exactly. So you can buy the most risky small cap stock and it will not give you that warning, but commodities will. So that must be some legal. Someone got sued at some point over that. That's why it exists.

Joey Loss 7:14

Yeah, Please tell your parents.

Adam Van Wie 7:29

So what caused all the volatility this Week. I think you can pretty firmly look at Microsoft as the catalyst. I'm not going to say they caused it, but they. I think the market wanted it. A lot of investors who were sitting on a lot of gains and Microsoft came out and the funny thing is they actually had an excellent earnings report. So the fact that they then sold off 10%, they lost over 350 billion in market cap on a single day because of a earnings report where they beat their target. Crazy. But it's what was behind that that seems to have gotten the market spooked. They are worried that the AI infrastructure investment that Microsoft is making will lower the profitability of its software programs. And I think there's also a little bit of a problem with software companies in general right now. And I'm going to get to that after the birth.

Steven H Van Wie 8:22

I think it is. I think it's very reasonable to assume that software industry is one of the targets for implementing AI.

Adam Van Wie 8:31

Yeah. Why would it not be?

Steven H Van Wie 8:32

Yeah. I mean, yeah, we need coders and all that.

Adam Van Wie 8:36

Well, I don't know. That learn to code advice is not looking very good.

Steven H Van Wie 8:40

Yeah. You know, Hillary blew another one. What can we say? All right, we got to take a quick break. We'll be right back. Don't go anywhere. This is the Van Wie Financial Hour. 

Steven H Van Wie 8:51

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

Adam Van Wie 8:53

I'm Adam Van Wie.

Joey Loss 8:54

And I'm Joey Loss.

Steven H Van Wie 8:55

And I had a couple of comments I wanted to clean up on the, on the market and then I'll get to the trivia question. But the earnings season is still pretty young with 280 reporting so far and the numbers are very fine. Earnings beats 75.4%. Revenue beats 68.9%. And the guidance is positive by 1.9%. That's the number of companies with up guidance over the companies with down guidance. Those, those kind of numbers look just fine. Yeah. Remember, we're not comparing to, to the low ball things that sometimes they're comparing to that companies were optimistic last time when they put their guidance out and they're beating it.

Adam Van Wie 9:38

Yeah. Those are solid numbers, especially going into a season where you didn't see a lot of earnings cuts. Forecast cuts about this one.

Steven H Van Wie 9:45

For things you haven't heard lately. The big winner, energy.

Adam Van Wie 9:48

Yeah. Yeah.

Steven H Van Wie 9:50

Despite falling gas prices. But what happened to natural gas was very understandable. If you look at the weather forecast for the country from about Arizona to Boston, we're going into the deep freeze badly. Natural gas sales will go through the roof and it doesn't surprise me at all that it had a spike, but it even lost a lot of the spike. But it was energy in general is still good.

Joey Loss 10:18

Shoot. We got a chance of snow here this weekend. Small one.

Steven H Van Wie 10:20

Yeah. Yeah. On the, on the FOX national weather report this morning they said Jacksonville could go as low as 11 and Miami into the 30s. And there's a chance that some of that weather in Miami, just because of the oddity of the. The air being cool and wet and all that stuff, they could get some snow flurries. A lot of you weren't around back in 89 when we had actual measurable snow, but we were. And I didn't like it then and I'm not gonna like it this time. And not that it sticks around or anything, but this. We're in for a cold weekend. You better be careful tonight and tomorrow night.

Adam Van Wie 11:01

Yeah, pipes 20, 23 degrees is what my app is saying that

Adam Van Wie 11:08

that should not happen.

Steven H Van Wie 11:10

I'll put in my order that it never happen again. And we'll see what happens. All right. We do have a trivia question as usual, brought to you by Paul Lloyd at First Coast Alarm. You can call Paul at 904-636-7888.

Adam Van Wie 11:13

All right. We'll see.

Steven H Van Wie 11:25

And our lines are open, by the way. So here we go. How many of you remember a year ago this week a company called Deep Seek. Remember that? Yep. That was the news that China just kicked everybody's butt on AI and did it for a song. And our stocks, especially the big tech stocks, absolutely tumbled. There were 25 that were hit particularly hard. Now, I want to know, since then, one year, the.

Adam Van Wie 11:34

Yeah.

Steven H Van Wie 12:02

The average. Yeah, the average increase. What is the average percentage increase in those stock values? And I'm going to give you a hint. The median increase. This is the worst 25 from the pounding they took for Deep seat. The worst 25 stocks. The median one year later is up 23.3.

Steven H Van Wie 12:23

How much is the average stock up? And you know, one of the things we like to talk about once in a while is the difference between an average and a median, just so you understand exactly what your statistics are showing. So Anyway, lines are open. 904-222-8255.

Joey Loss 12:26

All right.

Steven H Van Wie 12:44

Oh. Anything else to wrap up there?

Adam Van Wie 12:46

Two things. Okay. I wanted to talk about one interesting but completely meaningless item that happened. The S and P briefly traded above 7,000 for the first time ever before pulling back. There is absolutely nothing significant or relevant about that number. So don't overanalyze that. It's just Interesting to see almost every time the market reaches a new milestone like that, it tends to cross over many times before finally sort of overtaking it. And even then it could go back down below. But the, you know, the, the, the odds of going back down be over the 1000, 2000 level become smaller and smaller every year.

Steven H Van Wie 13:23

I've always thought of that as kind of a, a human characteristic. And you just see that number, it could go from like 35,500 to 35,700. Nobody bats an eye. But you can go from 3,900 to 4,000 and everybody panics and sells it off. And then it maybe on the fifth or sixth or seventh try they say, oh, okay, this is okay.

Adam Van Wie 13:51

Yeah, it's not even an important technical level. There's nothing about it that's has any meaning except that it's a cool round number.

Steven H Van Wie 13:59

Individual numbers like that, they're practically useless. Yeah, you can argue that a little bit too about the stock indices. Just who cares basically? Yeah. And it doesn't reflect any one stock in there. The closest thing we have to that is a Dow and it only has 30. Just observations.

Adam Van Wie 14:21

The other thing I wanted, I teased it earlier, but there is a, currently a bear market going on and that's in the software sector. Thursday alone that sector lost 7%. That was led by that drop in Microsoft. The sector is down 20.1% on the year. So officially bear market territory. The most common thought about what's happening here is that AI will eventually be able to code better than any human. So the need for software companies might just disappear or they'll at least look very, very different than they do today.

Joey Loss 14:52

And honestly I've been doubtful of that until this week. When I listen to some of what's. It's unbelievable. So 2026, we're going to call it the year of the AI agent, the personal assistant. The last few years have been about the chatbots. You have conversations with these large language models. It's a better version of search. You can have it do research, you can have it do a lot of things. But for the most part your interactions with it are text based. You give it text, it gives you back text and information. What's changing and where software companies are getting threatened is the next wave of this is going to be talking to a chatbot that knows you, that knows the tools you like to use, whether it's in a work or a personal setting. And it integrates with your calendar and your email and all these other things. And you get to a point where you say, hey, I want to book this person for the radio show or I want to book someone of this profile for the radio show. Can you find me four people and reach out to them and see if they're interested? And your chatbot goes and it sends these emails and it does these things and it can build a software, client relationship management software in the process of executing that task for you. And so that's where I think companies like Salesforce and all these other titans that have been so important to business for so long, there's kind of a glimmer of like, oh, that's a pretty serious threat. This is the first wave.

Adam Van Wie 14:57

Happening, it's pretty crazy.

Steven H Van Wie 16:16

Sounds good for hardware people though.

Joey Loss 16:18

Good for hardware. Everything's been good for hardware lately. They're the winners of this infrastructure build out for sure.

Adam Van Wie 16:24

The semiconductor index, despite all the volatility this week, was either at or right next to an all time high.

Steven H Van Wie 16:32

And to a degree, the utility companies are coming on strong too with, you know, they're going to send a mini nuclear reactor to the moon. Now I've always wondered ever since they started talking about putting people back on the moon and even colonizing it, what are you going to do for power? Well, now I know they're going to build a nuclear. Just heard that this week. Very interesting. I,

Adam Van Wie 16:52

Interesting.

Steven H Van Wie 16:58

I guess I'm dubious because I got to see it first. How much better do you think that the, the AI is now than it was even a year ago?

Joey Loss 17:07

It's incre. It's, to me it's mind blowing how much better it gets and how quickly that happens.

Adam Van Wie 17:12

Yeah, I agree.

Steven H Van Wie 17:14

So what do you tell your kids if they're going into college?

Adam Van Wie 17:17

I would say just be careful about what you pick as a major because there are industries that will be. I, I don't want to say that. Be completely replaced maybe, but the amount of people needed to do certain jobs, it's going to drop dramatically.

Steven H Van Wie 17:34

And plumbers are looking better all the time.

Adam Van Wie 17:37

Absolutely. Electricians, manufacturing, I mean all those things are going to stay good. I don't, I don't think there's, if you get a technical degree that isn't too specific, I still think you'll be able to be employed. But man, if I was, I don't know, an accountant or something that is repetitive and can be, to just be done over and over, I, that I would kind of worry about.

Joey Loss 18:02

There's, there's going to be an increasing premium on the ability to cultivate and manage relationships. And as we've Talked about many times on the show. Any sort of hard physical labor trade with a specialty skill. I think those two are probably the most protected because they're going to be hardest to replace with a. An AI experience.

Steven H Van Wie 18:20

I've been grooming the people like that that we have used at our houses since we've lived down here. I've been grooming them for 32 years or so. And I gotta say, when I call them, they show up and they finish the job and I pay them and that's the relationship. The sooner they show up, the happier I am about it. But just knowing when you can call somebody, a plumber, electrician, or whatever and just give your name and chat about them for a little bit and come over and fix it. Those people are so valuable now. They were always valuable to us, but never like now when you got a problem now trying to find somebody. And I've had that problem lately a couple of times. And just take good care of your workmen. Tell your kids. And they're getting paid to learn. I just saw a big program on this this week about young people who are making money while learning. They get out of their training program debt free with cash in the bank, and they're pretty much guaranteed jobs. Some of them are starting out over 100. There's a couple of places they're starting out over 200 a year. This is unbelievable. And it's such a great opportunity for young people, but they have to know about it and understand that you may not be sitting behind a desk all your life like certified auto mechanics. Have you seen an auto repair shop lately? They're beautiful. Yeah. Beautiful. Yeah. Wow. No, no. A good auto technician is one of the most valuable people in the country today. And they're hundreds of thousands of these jobs short and people are retiring. 5 out, 1 in is the ratio they're using. Oh, wow, that's terrible. Yeah, we need to reverse that to six in for every five out or something like that because there's just. There's no way you're going to be able to afford to get things fixed even if you could find somebody to fix it.

Adam Van Wie 19:49

Yeah. Air conditioned. Many cases. And making six figures. And can't find people.

Adam Van Wie 20:24

Well, maybe that's where all the computer science grads will go if they're not coding, because you'd have to have that degree to work on a car.

Steven H Van Wie 20:30

Yeah. What do you need? What do you need to work on a car? You need computer knowledge. So think it over, folks. Look at Mike Rowe, too. All right, we got to Take another break. We'll be right back. Get into some other things. This is the Van Wie Financial Hour. 

Steven H Van Wie 20:42

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

Adam Van Wie 20:44

I'm Adam Van Wie.

Joey Loss 20:45

And I'm Joey Loss.

Steven H Van Wie 20:46

I remind Everybody, lines are open. 904-222-8255.

Steven H Van Wie 20:51

And the trivia question since one year ago with the deep seat problem that hit the market, it was a rumor about AI and about how the Chinese had conquered it. It was of course a lie, but that didn't failed to hurt the market. And there were 25 big tech stocks that were really slammed because of that in the one year following. They are all, I want to say all up. There might be an exception, but that'd be the exception. But the median increase of those stocks in that one year is 23.3%. Not too shabby. What is the average increase? No hints. None allowed yet. All right, let's talk about the Fed. As much as I do test, the Fed is very important and you have to talk about it. So there was an announcement made yesterday and

Steven H Van Wie 21:49

you guys know more about it than I do. I know who it was, but I don't know many of the details just because I didn't get a chance to look into it very much.

Joey Loss 21:56

So I'm sure we'll have more on this in the future. But the two front runners were, it was the two Kevins people were calling those. You had Kevin Hassett and then you had Kevin Warsh. Kevin Warsh emerged as, you know, kind of the unlikely winner. Up until very recently, Hassett was kind of thought to be a shoe in. And Warsh is known historically for being a little bit neutral to hawkish against inflation, which means he would be the type to hike rates if he thought inflation was a problem. But in his conversations with Trump, he seemed to genuinely believe that we're in an environment where rate cuts are merited. That sat well with Trump and also just the candor of their relationship seemed a little bit more Kevin more palatable to Trump. And Kevin Warsh has much stronger connections with big companies, which those are important relationships for the Fed to have. And kind of funny enough, I was looking at some quotes, Trump thought that Kevin Hassett wanted the job too badly by the end, which is just the most Trumpy opinion that he could get out of that. And he called him a used car salesman in terms of how he was approaching trying to get the job. So tells you a little bit about something, how to blow a sure thing.

Steven H Van Wie 23:12

Reminds me of out of Trump's first four years. Scaramucci.

Joey Loss 23:17

Yeah.

Steven H Van Wie 23:18

Would he last 11 days or 12? Something like that. He wanted it too badly and when he got it, he was just too important.

Joey Loss 23:25

Well, Hassett, he was getting the nickname Kevin the Hatchet because he was so eager to come in and cut rates. And there was something unprofessional about it. Like even if you think that rates need to be cut and you don't love the pure independence of the Fed, there was something unpalatable to me even about the way that he was talking about it. And Warsh coming in with sort of a more sure footed belief that in this environment that's the right thing. That presents a little bit more of a sense of protecting the independence of the Fed while also playing ball with current events and what we think needs to happen.

Steven H Van Wie 23:58

I think Haas is so good where he is. He gets to be on TV and support the administration's policies. Right. Frequently where if he were independent in the Fed, we'd lose that spokesperson. And I think he's valuable there.

Joey Loss 24:13

Yeah. Trump, Trump said he was valuable there, wanted to keep him right there.

Steven H Van Wie 24:16

Which is, can be a nice way of being both truthful and accurate and also not breaking your heart any worse than you have to. Anyway, that we'll see. It's not till May. I, like Adam said, I was kind of put off by the fact that a lot of people were blaming that choice on the crazy things that went on in the market. It's May, people, January about to be February, April and then May. Nothing's going to happen the next eight weeks.

Joey Loss 24:50

No. And I think this is a really impressively calculated decision in my opinion because the initial conversations about replacing the Fed chairman seemed a bit emotional and overly urgent to me and, and where we landed. To get to this type of presentation of who the person is and for that person to be Kevin Warsh is a good thing because one of the things the market hates more than anything is turmoil around who's the Fed chairman. And a pick like Kevin Warsh got praise from both sides of the aisle. And that is somebody who, if we end up with a Democratic administration in the next presidency, that person, Kevin Warsh, could endure into that term peacefully based on his profile. We'll see what he does.

Steven H Van Wie 25:29

But very true. You know, it. I just can't get over the fact that the Fed has outlived its usefulness. But it's not going anyway. Not going anyway. Anyway. So I'm, I'm stuck with it and we got to make the best out of it. And I agree with you. I thought he made a good choice.

Adam Van Wie 25:45

Yeah, I agree. I, I said this off air, but I want to say it again. The first thing, his first order of business should be to return the long term inflation target to 3%. It should not be 3%. Yeah, it's. That's a ridiculous target.

Steven H Van Wie 25:57

What, you know, I should look this up sometime. What idiot decided at the Fed to lower it to 2%?

Adam Van Wie 26:03

I don't know, but it was just.

Joey Loss 26:05

During that decade of inflation being that low. I think we're like, oh, we're in.

Steven H Van Wie 26:08

A new world, a new paradigm.

Joey Loss 26:10

Right.

Adam Van Wie 26:11

Why? Why? I mean, these people, people like that should be smart enough to know that in finance terms, 10 years is nothing. I mean, you have to look at 100 years of data and say, oh, it's been 3% for 100 years. That's probably the right target.

Steven H Van Wie 26:26

Kind of like looking back over a multi decade chart of the stock market. Pinpoint 2008.

Steven H Van Wie 26:34

It's that little dip. And yet it was terrifying at the time. Yeah. Time, time in the market. I guess that's the way it's always been said. And it's always going to be, God.

Joey Loss 26:35

Yeah, yeah.

Adam Van Wie 26:38

Absolutely.

Joey Loss 26:47

Forbid you decided investing was a bad way to go between 98 and 2008, because what happened after that was pretty darn good. You know, 10 years.

Steven H Van Wie 26:54

Yeah.

Adam Van Wie 26:55

It's just not, in fact, since, if you. Since 1988, the S P500 has returned 5,800%.

Steven H Van Wie 27:05

And what about real estate?

Adam Van Wie 27:07

Real estate has. We were talking about this 380%.

Steven H Van Wie 27:11

Yeah.

Adam Van Wie 27:11

Which is, there's a good return, but it is not 5,800%.

Steven H Van Wie 27:16

No, I know which way I will go. The same way I've always gone. I'm staying in the market. Yeah. Period.

Joey Loss 27:23

And there's a place for both. But I think, you know, if you're, if you're putting money places for purely return purposes, that that's a relevant comparison.

Adam Van Wie 27:31

Yeah. And it's interesting because I'm looking at the chart right now and you can barely identify in the real estate return chart 2008 and 2020, arguably the two most volatile years in real estate prices in history. I mean, you can barely tell.

Steven H Van Wie 27:47

Yep. All right, here's. We mentioned real estate. Let's talk about it a little bit. There's a new bill in front of Congress about trying to get older people to shake out their houses, get them in the market and that kind of thing. This is kind of interesting. And at first when I got into it a little bit, I Kept shaking my head, wondering what the hell is he trying to accomplish here? It's called the American Dream Act. It would allow individuals 65 or older to sell a home to a first time home buyer for 500,000 or less without paying capital gains. I thought, you know, if you're a couple selling your home, you already have a built in $500,000 gain. If you're an individual, you got 250. And if this is only going to apply to homes that sell at or under 500,000, how many people would wind up paying capital gains in there?

Adam Van Wie 28:43

It's completely worthless.

Joey Loss 28:45

You know, let me give you the profile. Someone who's been in their house for 50 years, they're single and they bought it for 80, and they sell for 500. Then there's some capital gains. That's very, very narrow.

Steven H Van Wie 28:53

There you go.

Adam Van Wie 28:55

Yeah. Okay. I think you just described about a thousand people.

Joey Loss 28:59

I know for everybody else, you get a win politically and you've changed absolutely nothing.

Steven H Van Wie 29:04

But there's a, but

Steven H Van Wie 29:08

there is a point here. If you dig in enough. And first off, remember, I got it restricted to first time home buyers. And the definition of a first time home buyer is an IRS definition. It does not mean you have never owned one. I believe it's five years. Since you've owned a home. All right, that's, that's one thing. And of course it has to be, it has to be of that price range. But, and this would, by the way, this would take effect and be in effect for five years. They're worried it might interfere with the market if they leave it too long. That's not bad. Here's the key. But no such exclusion exists for vacation homes or rentals. This would apply to second properties. Now. It just went from totally useless and meaningless to brilliant.

Adam Van Wie 29:22

Yeah.

Adam Van Wie 29:58

That actually would make a difference.

Joey Loss 30:00

Steve, I can't help but feel like you set me up. I got pretty emotional there.

Steven H Van Wie 30:04

I think it was those other people that were setting up. You came along for the ride. All right, but isn't that interesting?

Adam Van Wie 30:11

That is the other problem with that though is if you're a first time home buyer looking in the sub 500,000 range and you know that the person that's selling has a very limited pool of buyers and a very big tax break coming, what are you going to do? I'm going to offer less. Because I have buy, I have power to save them money on a tax bill. So I'm going to offer less than probably the average person on the street would offer. Because my offer is then worth more.

Steven H Van Wie 30:26

Yeah.

Steven H Van Wie 30:39

They're always going to be some things like that. When you allow people and personalities and common sense and, and choices into it, the formula gets bent around a little bit. The, the real question whether this will pass is going to depend on how they can sell the concept that this is ultimately a good thing. And I hold it in my left hand with one other thing that just came out. The Federal Reserve data shows that US home mortgages have been above 6% for more than three years and now they outnumber 3 percenters. So the average mortgage rate is climbing up and there are a lot of them in the 6% range. So if somebody has a 3 percenter, they're very unlikely to sell it out. We've all talked about that in front of everybody for a long time, and I think that's very true. But what if you have a second property? Well, second property, you're not going to have a 3% mortgage on it. Usually mortgages, I don't know how much experience anybody has with that. But if you had a second property, say a vacation home or a rental, and you refi it, what's the lowest you've ever seen on a second property? Lowest mortgage?

Adam Van Wie 32:00

I don't know. I'm sure.

Joey Loss 32:01

I think it's at least half a percent, 2% higher than whatever the going primary home rate is.

Steven H Van Wie 32:07

I think this has a lot of merit all of a sudden for trying to get people to shake out their second homes. And it's only for people over 65 who are probably looking to downsize their properties anyway. So I'll let you know how it happens, if it happens, and we'll follow up on the results. All right, we've got to take a last quick break, and then we'll be right back. Don't go anywhere. This is the Van Wie Financial Hour. 

Steven H Van Wie 32:30

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

Adam Van Wie 32:32

I'm Adam Van Wie.

Joey Loss 32:33

And I'm Joey Loss.

Steven H Van Wie 32:34

Remind everybody, the lines are open. 900-422-28255.

Steven H Van Wie 32:38

Trivia question. Of the 25 stocks that got hurt the worst a year ago by Deep Seek, they are up a median of 23.3%. What is the average increase in those stock prices since then? There's a lesson here, believe me. But I just asked the guys here in the break

Steven H Van Wie 32:58

what percentage of people who are in RMD age groups, which vary a little because the laws have been changing. But of all the people in the country who are faced with an RMD this year, last year Whatever. What percentage of them have a penalty because they either didn't do it or didn't do it right, didn't do it enough or whatever. And that answer, this is not a trivia question. That answer is one in three according to Vanguard. And I am absolutely appalled that one in three people would not do their RMDs correctly.

Joey Loss 33:30

Well, until a couple years ago, that was a very bad mistake to make. It's still a bad one, but it was. There was a 50% penalty and now it's like 25.

Steven H Van Wie 33:40

And I think you can get 10 if you do it quick enough, that kind of thing. But you know, the best preventative Vanguard found,

Steven H Van Wie 33:50

hopefully. So you never have to do that. You guys are going to love this. It's called having a competent financial advisor.

Adam Van Wie 33:59

Imagine that.

Steven H Van Wie 34:00

I think we had this discussion this week in the office, didn't we?

Joey Loss 34:03

Do you know any, do you know any competent financial advisors?

Steven H Van Wie 34:08

I'm thinking, you mean who aren't in the room, right? Oh, there's a couple. Yeah. Most of them are right here. Yeah. Right now. Yeah. Anyway, the best, the best advice, Vanguard would indicate they didn't say this, but they pointed out how to fix it. So I call it advice. The getting a good, good financial advisor helps. And I speak for us a bit in that we are very on top of that. You know, you guys, you guys got started in November, I assume, and just one by one, no mistakes, double check, everything.

Adam Van Wie 34:46

Triple checked. Yeah, I'm obsessive about it. I just don't want anyone to ever. Especially if it were my fault, I would be, I would feel awful and I wouldn't just never let that happen.

Steven H Van Wie 34:57

Right.

Joey Loss 34:57

Yeah. I mean, it's just such a. Yeah. That's pretty much a lockdown period for us. I mean, we, we. Yeah, it's what the sole goal is to get those done and, and do withholding properly based on conversations we've had with clients so that there's no surprises and all the boxes are checked.

Steven H Van Wie 35:12

Vanguard also pointed out that if you might otherwise have been one of those people, and you aren't because of your advisor, you just paid the fees. You saved the fees that you paid your advisor by not getting penalties, that's not to mention paperwork. And I hate anything that's a flag to the IRS anyway. And in the same line with that, the qualified charitable distributions, not enough people use them or understand them. But if you're an RMD type from a taxable account and you want, and you're charitably minded, you want to find out how to use qualified charitable distributions to get your money out of your account and totally avoid any possibility of taxes on it. And that's another thing. I know you guys have been on top of a lot lately because, see, how many transactions go.

Adam Van Wie 36:05

We do hundreds of thousands of dollars.

Steven H Van Wie 36:07

Of QCDs every year, and that's money that never hits your top line. Therefore, you don't have to get to the bottom line by any method of any other method, like deductible funds or something like that. You just get it. I call free money for being charitable.

Adam Van Wie 36:25

Yeah, well, there's another way to get free money for being charitable. This year, new tax law change that you can actually donate cash and get a receipt and up to $2,000 per couple. And so that is. That is new. You do not have to itemize to get that.

Steven H Van Wie 36:39

Yeah, that's wonderful. Speaking of not itemizing the new senior $6,000 deduction, you don't have to itemize either. In fact, I thought about this one this morning, reading it, too. It's kind of scratching my head. If you do itemize, you don't get it. Well, if you do itemize, you don't need it. When you think about it. So if you're. If you're normally at, say, 32,000 and you're married, filing jointly, so this would take it up to 44,000. If you itemize and you get, say, 40,000, you don't get the other two. Because why don't you just take the standard deduction then? I have heard, say, for 25 years I've been in this business, I have heard so many people say that when you itemize,

Adam Van Wie 36:48

No.

Adam Van Wie 36:59

Yeah. Then it's.

Joey Loss 37:23

Right.

Steven H Van Wie 37:34

you get the deduction for what you would otherwise lose. No, that's so stupid. But it was so common. You know, if you put a big mortgage on your house, it saves your deduction for property taxes. Well, no, it doesn't. What, really, there were. I would name names if I had to, but I don't have to and I won't. But if you can add up deductions that are bigger than the standard deduction, plus the 6,000 per person, do it. Otherwise, just be quiet, smile, and thank President Trump.

Adam Van Wie 37:42

That's funny.

Joey Loss 38:12

I think the way to think about it. Yeah, there's all kinds of perverse ways to make it seem different than it is. The way to think about it is the standard deduction is the floor. If you earn your way past it, you get to have it. And if you don't, the floor's pretty Darn good.

Steven H Van Wie 38:27

For those of us who are over 65, our standard deduction is bigger than yours anyway. And now it's way bigger. And I could not be happier. Anyway, just one of those little things. I've been accumulating a lot of them. All right, how about people getting swindled? You guys know what HOA bonds are?

Joey Loss 38:50

Never heard of it.

Steven H Van Wie 38:51

No, HOA is exactly what you think it would be. Homeowners association. Apparently many homeowners associations need surety bonds to because they collect all your, your monthly escrow payments. And the good ones will escrow against things like roads and roofs and paint jobs and all that. So it can be a lot of money. And to prevent foreign fraud on the board, on the HOA board, they, a lot of them are required to buy surety bonds. Now if you wanted to ensure the money in your escrow accounts, who would you think of going to?

Steven H Van Wie 39:34

I don't know, huge insurance companies that do things like this? Probably. Sure. Maybe huge banks. Well, this situation, this fellow named. Now it's hard to say, it's S L O T H O W E R. So it's either Slothauer or snow thrower or something like that. But this guy,

Joey Loss 39:41

Yeah. Some kind of commercial.

Steven H Van Wie 39:57

$1.1 million

Steven H Van Wie 40:01

in restitution because he sold, he's from Southampton, New York, by the way. He sold a bunch of people in Florida on these guaranteed no risk surety bonds. Well, what did they get

Steven H Van Wie 40:17

taken? Let's see. He invested in $125,000 Mercedes membership dues at Long Island National Golf Club. Oh, and he made a few payments to victims. It's classic Ponzi. Of course he made, made some payments, quarterly payments to the earlier investors just that came from new money. And he, he, a lot of people lost and a lot of them from Florida. And I can't count the number of times I have said over the years on this radio that if you can't see your money on a third party trustworthy website 24 hours a day, 7 days a week and know exactly what it's worth, then you have been taken. And I can't tell you enough. And I, you know, I hate to dwell on it, but I blame the investor for a lot of these things because they don't use common sense. You tell them they're going to get 8% a quarter or something like that by having an HOA bond. And they don't hear HOA bond, they don't look it up. They don't know what it is they, what they heard was 8% a quarter risk free. Yep.

Adam Van Wie 41:35

The very similar article I'm looking at right now about a financial Advisor based in St. Pete. His name is Todd Burkhalter. He founded Drive Planning and he marketed, marketed a fraudulent investment scheme using money in part to buy a $2 million yacht, a $2.1 million condo in Mexico and a motor coach. His shtick was that he made short term loans to real estate developers and promised returns of 10% every three months.

Steven H Van Wie 42:09

All I heard was 10% for every three months. Yeah.

Adam Van Wie 42:13

And he ended up bilking investors out of $380 million.

Joey Loss 42:18

Wow.

Steven H Van Wie 42:18

Yeah, well, that puts him like Madoff wannabe.

Adam Van Wie 42:22

I know. That's a pretty big number.

Steven H Van Wie 42:24

No kidding. All right, let's jump to another form of stupidity. All the way out on the left coast, California has now taken a second step toward a vehicle mileage tax. I didn't know this and I don't think too many do, but they've been running a test market in California, voluntary, where people turned in their mileage and

Steven H Van Wie 42:49

they, they don't have to pay or anything. They were just testing the system, see how it worked. Well, they now put the study group out there and

Steven H Van Wie 43:03

all they need is a few more signatures. I believe their house, the assembly already passed it. So it's a step toward implementation.

Steven H Van Wie 43:12

And what's even scarier than that, I think, is, is that they're saying, well, then we can eliminate the gas tax. And part of this was stimulated by EVs.

Adam Van Wie 43:23

Oh, definitely.

Steven H Van Wie 43:24

And you know, and I know that when they eliminate the gas tax two years later, there will be a mileage tax and a gas tax and here we go again.

Joey Loss 43:35

Yeah. Or they'll just ban gas cars. Be like, welcome to the future.

Steven H Van Wie 43:36

Yeah. Yeah. Well, now this is quite as important as when their ban was able to take effect, but it is still important because you know what's going to happen. Those people cannot look at something that say, oh, we don't tax gas anymore and just say, well, that's the way it is and that's the way it should be. It's not going to happen. It's just not going to happen. Stay alert out there, people. Hopefully that's one of the things you get by listening to us. We try to be as cynical as totally possible about things like what could happen to your tax money. So we'll guard it for you. Give us a call anytime. Thanks for listening. We start week 12 or year 12 Saturday. Be there.