June 13th, 2026 - SpaceX Has Launched!

Amidst lively banter, Steven and Joey delve into financial markets, discussing the celebrated SpaceX IPO and the dynamic interplay of global economics. Humor and anecdotes flow as they explore unemployment rates and Elon Musk’s wealth, threading through market volatility and inflation intricacies. Listeners participate with trivia and calls, adding vibrant color to the already bustling conversation.

Transcript

Steven 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. 

Joey Loss 0:06

And I'm Joey Loss.

Steven Van Wie 0:07

And Adam is away once again this week. He'll be rejoining us someday when he decides to, I guess.

Joey Loss 0:18

I think they're having a. This one was a big one because their son just graduated high school. He's going to a great, great college. Have some good time.

Steven Van Wie 0:23

Yeah. Yeah. They're actually trying to spend as much time together as possible because, you know, come August it's over. Yeah, I remember those days really well. And you do get a little apprehensive as it's about to happen. And there been some cute commercials about that sort of thing. You know, the parents have the hang dog look and the kids worried about them, they leave, get in the car, go around the corner and yappy.

Joey Loss 0:58

Oh well.

Steven Van Wie 0:59

But I digress as I so often do.

Steven Van Wie 1:04

Welcome back to all the regulars. We, we appreciate you always being here. We've been here. We're in what year? Year 12.

Joey Loss 1:13

I think this is the 12th from what I gather.

Speaker 2 1:15

Yeah.

Steven Van Wie 1:15

Okay. And you know, you, you keep listening, we keep talking. That's the way it works. And it will remain free to everybody. And so it's pretty hard not to get something of value very reasonably. So try to stick around for the hour. And if you're new, the rules are the same as for everybody else. If you want to talk about what you want to talk about, pick up the phone, dial 904-222-8255

Steven Van Wie 1:44

and we'll be happy to put you on right away if you would like to get in touch with us. Other than that, you can always do an email info @strive us wealth.com.

Speaker 2 1:57

all right.

Steven Van Wie 1:58

Lots going on as always, and we will, we'll get to all of them. But I was very happy that finally something that's been bothering me a long time got resolved.

Joey Loss 2:11

What was that?

Steven Van Wie 2:12

Elon Musk is actually wealthy.

Joey Loss 2:15

Oh, that was bothering you?

Steven Van Wie 2:16

Yeah. I couldn't quite decide where that line was drawn, but as of yesterday, I know right where that line is drawn and it's right below him now.

Joey Loss 2:25

It was when he got a million. Million dollars. Other. No, otherwise known as a trillion.

Steven Van Wie 2:27

Yeah.

Steven Van Wie 2:30

Yeah, yeah. I love to speak of billions in terms of a thousand millions because it gives you a little bit more of a, a feeling for how much money that is. I, I could line up a thousand people and give them all a million and they'd all be happy and I would only have spent a Billion dollars. But when you have that ability a thousand times, then you're a trillionaire. It's unfathomable.

Joey Loss 2:54

Yeah.

Joey Loss 2:57

Well, and a trillion is larger than the GDP of several developed countries.

Steven Van Wie 3:03

There are only 21 countries in the world with a GDP larger than his net worth. Wow, that's unfathomable.

Joey Loss 3:11

And yet Elon lives in basically a box. Yeah. In San Antonio, near Starbase. He. It's a 600 square foot. Yeah, nothing.

Steven Van Wie 3:19

That's not the only thing he owns. But that's where he stays. He's either working or sleeping. And he doesn't sleep much. Real simple. How did a guy like him get to be a guy like him? Well, a be born brilliant and to work your butt off and like that, take chances. What is absolutely fathomable but not.

Joey Loss 3:22

Yeah, he.

Speaker 2 3:27

Yep.

Steven Van Wie 3:44

Not. What's the word I'm looking for? Acceptable, is the reaction of people like Elizabeth Warren. She said essentially that you can't earn that trillion dollars. And the idiot that's running for the Senate in Maine says something like, let's make sure this is the last one. And they want a wealth tax and all that. Why? Because he has a title like trillionaire?

Joey Loss 4:05

And.

Steven Van Wie 4:14

No, they don't like billionaires either. They used to hate millionaires until Bernie became one and Elizabeth, worth over 12 million. Just leave it alone, people. If you could count up the taxes that people pay because they're involved in his industries, it would buy most small companies, countries. I mean, just, you know, let the guy go. He generates capital, he makes people rich. There are somewhere around 4 or 5,000 millionaires today that weren't last week at this time. Some of them work in the cafeteria there. Everybody there accepted the deal that he was willing to offer, which is, I won't pay as much as the competitors, but I'll give you stock. And if this company succeeds and we go public, you will make a lot of money. And guess what? They just did. And I'm so happy for them. What bothers me is, well, I'm going to do this after the break because you need to get into the market, Cap. Other things happen this week too. And I will talk about what bothers me about some of these people, and I think you'll understand. So anyway, this week in the market, the key word to me was volatility.

Joey Loss 5:33

Yeah, it was a choppy week. The major. Overall, the major averages were pretty quiet on the surface. It was really. The week before that was especially choppy. And I think it just, somehow it just felt like it continued this week. But there was a lot going on underneath. So The S&P 500 finished Friday at 7431, which is more or less flat on the week and up about 8.6 on the year. The NASDAQ 100 holds a 17% year to date gain, but the real action was in parts of the market that had been left behind. The Russell 2000 small cap index jumped about 3% on the week and is now up over 18% year to date.

Steven Van Wie 6:10

It's also Friday's close was a record again.

Joey Loss 6:13

Oh, was it? And emerging markets riding the semiconductor trade in Korea and Taiwan are up a remarkable 24% year to date, which is awesome to see because it has been a while since emerging markets has really spoken up. The standout move though was energy going the other way. Crude oil fell roughly 8% on the week after President Trump announced a settlement framework with Iran. Brent dropped to around 87 a barrel. WTI and Brent are still up 40% on the year because of the war premium built in this spring. But the direction this week was sharply lower and that matters for everything downstream, including gas prices. So that takes us into inflation where we have two stories. You have to listen to both sides of the numbers. So the government CPI report showed headline inflation at 4.2% year over year, which is a three year high. But strip out the Iran driven energy spike and it's far tamer. Core prices excluding rent rose less than 1% annualized in May. And there's early evidence that the tariff driven goods inflation is finally wearing off. Now contrast that with truflation, the real time index that we track. Truflation's US CPI reads just 1.88%. That is a 2.3 point gap below the 4.2% figure. Truflation's PCE measure reads 2.51% versus the government's 3.7%. The reason for that gap? Truflation is already picking up. Sheltered deflation that the BLS methodology hasn't captured yet. And it's led the official numbers for three straight weeks. Historically a 45 day leading signal. So the honest read is that the scary headline is mostly energy and the forward looking data suggests underlying inflation is cooler than the government print implies. I'll talk about rates and then I think we might need to carry this into the the next section here. So here's the tension. Because the headline number is hot and energy is the driver, the market has flipped from expecting cuts to expecting potential hikes. Fed Funds futures now put roughly a 72% probability on a December rate hike up from about 45% just a week ago. You can see it in mortgage rates, which backed up from 6.05 in February to 6.44% in May. And that reverses the spring's affordability progress on the housing front. So the setup is the Fed caught between a genuine energy shock pushing the headline up and softer underlying data. And that's exactly the kind of cross current that keeps policy on hold and. And markets jumpy on every Iran headline.

Steven Van Wie 8:00

Definitely.

Steven Van Wie 8:41

Yeah, I am absolutely convinced that they'll do the right thing in the next meeting or two. And the right thing right now is nothing. 

Joey Loss 8:48

Yeah, you got to wait and see.

Steven Van Wie 8:49

We'll be right back. Don't go anywhere. This is the Van Wie Financial Hour. Welcome back to the Van Wie Financial Hour. I'm Steve Van Wie. 

Joey Loss 8:56

And I'm Joey Loss.

Steven Van Wie 8:57

And I tell everybody Again, lines are open. 904-222-8255. And we do have a trivia question as usual. Sponsored by Paul Lloyd at First Coast Alarm. You can call Paul at 904-636-7888.

Steven Van Wie 9:17

I have many options today, but I think I'm going to. I got to talk today a lot about the economy, so I thought I'd do a little economic thing here today. Let's see,

Steven Van Wie 9:32

what's the real unemployment rate today? We're advertising 4.3, but there are a lot of people who are not counted as unemployed even though they want a job. According to them, they just won't look for one. So I can't figure out the method of thinking of these people. But I can say just the actual unemployment rate if you add those people who claim to want a job, but are too, whatever, lazy or useless or whatever, too busy maybe to actually look for one. So the one that they advertise the headline rate is 4.3. What's the actual. And you have to be fairly close. Not real close. That'll do. All right, anyway, back to the market wrap. Joey's got a bit more going on here, so let's get at it.

Joey Loss 10:25

Yeah, the last piece was really just to summarize the whole thing. Like, what does all this mean? So if we step back, the through line of this week is a market increasingly built on two things and they're counter to one another. You have debt which is rising, and then you have what they call the animal spirits of the market, or in this case, just a sense of broad market optimism surrounding space and AI, which capped off with, of course, a successful IPO for SpaceX. At least the first day. So the Fed's quarterly flow of funds report showed that the US debt is growing at the fastest pace in nearly 20 years. And this is driven by corporations borrowing to fund the AI data center buildout and consumers borrowing to absorb a higher cost of living. Federal debt is now just under 110% of GDP. And on top of that releveraging, the IPO window is blowing wide open, of course, with SpaceX raising 75 billion in the largest offering in history. Anthropic and OpenAI are lined up not too far behind it. That is exciting, no doubt, but it's also the kind of froth which, combined with the collapse in stock buybacks from corporations, has historically been a poor signal for long term returns. The first day pop on SpaceX was 19%. The academic record says the three year return on a hot IPO is far more modest than that. None of that means that the rally is over. But small caps breaking out and broad participation are genuinely healthy signs. That's a good thing. But it does mean that the smart posture right now is to enjoy the moment's prosperity while keeping an eye on what's happening underneath. Leverage is rising. The inflation picture is okay, but it's murky. And a lot of this market's enthusiasm is now riding on companies that are still losing money. Discipline, diversification and a plan will beat chasing an exciting stock statistically based on history, every time.

Steven Van Wie 12:12

Yeah, I am cautiously optimistic that something will come of this around negotiation. I certainly am old enough to understand that you can trust them only while you can look them in the eye. As soon as you turn your back, they're going to put a knife in it. But the only right thing to do for a true negotiator is to get a deal in writing and then start hammering out the details. And you got to have a big stick behind it. If they so much as shoot one thing at one ship that trying to go through the straight of Hormuz, then they should be penalized by a pounding. You just, you can't deal with these people. They only understand one thing, force. Well, we've got one and it's right outside their front door in a couple of locations actually. So as I said, I'm cautiously optimistic. And if that thing does get signed and they begin the real hard work on it, I think the market is going to breathe a sigh of relief and shoot up again. You probably start seeing records happen again. Nobody knows for sure.

Joey Loss 13:23

Yeah, maybe. I mean, I feel like the market, if you had asked me three months ago, how would the market be pricing in the fact that this is still going on? I would have said it would look far worse than it does today. So I just. I think. How much more room up is there to go? You know, if we do see what looks like a resolution, it sort of feels like the market's priced it in. And a big part of that. We've talked about this before, is the fact that most of what the US Exports is highly profitable softwares. It just doesn't depend on oil in the way that so many other industries do.

Steven Van Wie 13:32

Me, too.

Steven Van Wie 13:54

Look, we're exporting a bunch of that at these prices, too.

Joey Loss 13:57

Right. Looks like we have a caller, actually.

Steven Van Wie 13:59

Well, sure enough.

Steven Van Wie 14:02

Good morning, Ron.

Speaker 2 14:04

Good morning, gentlemen. Great show as always.

Steven Van Wie 14:06

Thanks so much.

Speaker 2 14:08

Thank you. And I just can't believe that Elon Musk is worth over a trillion dollars. I was wondering, with inflation, was John D. Rockefeller worth more? I kind of doubt it.

Steven Van Wie 14:21

He wasn't, actually. I. I have read that recently that when they were speculating about the first trillionaire and they. They gave a few examples, and I don't remember exactly, but I'm. I'm thinking it was something like 486 billion. Some astronomical number, of course.

Speaker 2 14:42

Chicken feed.

Joey Loss 14:43

Yeah.

Steven Van Wie 14:43

You know, he didn't. He didn't make his money by starting Standard Oil. Do you know this? He made his money after they broke it up and then all these little other companies and he wound up a stock in them and everything went up. That's when he became super wealthy.

Speaker 2 15:02

The government did him a favor. They did.

Steven Van Wie 15:04

Not intentionally.

Speaker 2 15:06

No. That's funny. I never heard that before.

Steven Van Wie 15:10

You learn a lot of stuff in MBA school that may not be particularly relevant, but it's really interesting.

Speaker 2 15:17

That's awesome.

Steven Van Wie 15:18

Yeah. All right. Do you want to.

Speaker 2 15:21

Yeah. Could I take a shot at the trivia? I'm going to say around 8%.

Steven Van Wie 15:23

Of course.

Steven Van Wie 15:26

Oh, you're just a little low. It's outside my margin. But everybody else listening is going to love you.

Speaker 2 15:35

Yeah. I did somebody a favor.

Steven Van Wie 15:37

You sure did. I hope they take advantage of it. You take care of yourself, too.

Speaker 2 15:39

All right.

Speaker 2 15:43

Have a great weekend. Thanks. Keep up the good work.

Steven Van Wie 15:45

Thanks.

Steven Van Wie 15:47

Like Angela was saying right before she signed off, another glorious northeastern Florida Saturday morning. So I'd say as soon as our show is over, go out and enjoy it. How did I do?

Joey Loss 15:54

Yeah.

Joey Loss 16:00

That's good. And that we. In Neptune beach, there's some kind of like, touch a truck day, you know, of course, for kids. And my daughter is obsessed with fire trucks, so it's a big day for us. We're gonna go have some fun.

Speaker 2 16:01

Yeah.

Steven Van Wie 16:13

Well, good.

Speaker 2 16:14

All right.

Steven Van Wie 16:15

Anything else we need to say about the market? I really don't have anything else.

Joey Loss 16:20

No. No, I don't think so.

Steven Van Wie 16:21

I do think that the Federal Reserve is, since it's been reconstituted a bit now, I think there are a lot of people who will agree with me that the best thing they can do is nothing. And I believe that's what they'll do at the. At least at the upcoming meeting. Because what you're going to see is if this Iran deal holds, you're going to see such a sharp drop in the price of oil and it will trickle down to a lot of things. Right now, if you look at the core cpi, which is the one where they strip out the variable components of food and energy, it's already getting very close to the Fed target. If you also then strip out rent because rents have been softening, you would find that you're just right about on the target of 2%. Couple of comments on that. As Adam has long said, and I have long agreed with, I wish the new Fed would just go back to the way it's always been and target 3%, which is, I think, a healthy growth rate and so on. You can afford to have decent interest rates with that, and you can also afford to have a lot of jobs with that. And you don't have to be worried about it going out of control. It's just my opinion and you get it for free. How about that? The other comment is, what a shame. We have to buy energy, we have to buy food, and we have to put a roof over our head. Therefore, these three things are really nice, what ifs, but it's got to change because, and we've talked about this, too, right now, it's not the technical definition of an inflation. It's an increase in prices due to one basic commodity. On the other hand, if you don't fix it fast, it creeps into a serious case of inflation. Trump knows. He'll look you in the eye and tell you he's in no hurry. Trust me, he's in a hurry. Oh, and speaking of Trump, in the immortal words of Marilyn Monroe, happy birthday, Mr. President. Tomorrow. And he's throwing himself a little fighting match outside the White House. And the weather forecast is a little iffy, so we're hoping that they get through it. You know, I've read that only 16% of Americans approve of him doing that. People. You what? How much time are you going to spend raining on somebody else's parade? If you can't figure out a reason to not buy SpaceX or not watch the match that's going on? It just do whatever it is you like. Leave the poor guy alone. My God, look what he's doing for all of us. And I'll get more into that too.

Joey Loss 18:11

Yeah.

Joey Loss 18:27

No, it's his birthday today. Tomorrow. Okay.

Joey Loss 19:12

Well, I'm in that 84. That doesn't like it, but it doesn't matter. I don't spend much time on it, but I feel bad for the lawn guys. That's got to be their worst nightmare. Setting up a stage on the. Can you imagine? My dog goes out in the backyard for five minutes and I got like a three hours of work. Set up a UFC match. Yeah.

Steven Van Wie 19:29

Smaller dog.

Steven Van Wie 19:32

All right, we got a minute. I got a couple of quick things here.

Steven Van Wie 19:37

The we did that.

Steven Van Wie 19:42

Did that. Oh, I wanted to mention some of the problems with the SpaceX employees. There's symptoms out there and one of them is that the realtors are saying that the interest in high end real estate is going crazy in San Francisco, in the South Bay area and right outside of Boston. And there's interest both in larger and second homes. And the travel market is feeling a real upswing in private trips on private jets. And I'm telling people if you spend your million, you are decreasing your lifestyle. More on that when we get back. All right, we got to take another break and we'll be right back after we pay some bills. This is going to be a fun one from here on in, so don't go away. This is the Van Wie Financial Hour. Welcome back to the Van Wie Financial Hour. I'm Steve Van Wie. 

Joey Loss 20:43

And I'm Joey Loss.

Steven Van Wie 20:44

And I remind everyone once again, the lines are open 904-222-8255 where you can take a shot at the trivia question. What is the real unemployment rate? The one where they factor in people who claim to want a job but have not been counted because they haven't looked in the last four weeks. So the reported rate is 4.3. What's the real one? We know that 8 is a little too low, so this could be pretty easy for people. All right, let's say you've been working for SpaceX for a long time, making maybe less than market rate, but getting along fine. And all of a sudden one morning you wake up and somebody hands you a stock certificate that shows that you now have a million dollars in SpaceX stock. What would you do? Well, first off, it's not income, it's not cash.

Steven Van Wie 21:41

If you sell it, you're going to pay taxes on it as capital gains. Short or long term, I don't know. But it's not cash and you can't spend it today. So what will be the price of SpaceX when your restriction goes off and you can sell it? I don't know. I have no idea. It might be what it is now. It might be higher and it certainly might be lower. I just, I don't have a way to tell. The one thing you know, is that when you do sell it, you will not have as much money as you think you have because it will be the taxes on it. Well, right now, just on the, on the surface of this thing, there are a lot of signs out there that the natives are getting very restless about wanting to spend the money. And I will talk about that right after we say good morning, Bosco.

Speaker 2 22:37

Morning, y'. All. Another fabulous show here. We appreciate it. Listen, what do you, what do you think, you know, as far as, you know, this new SpaceX stock price being costing too much or, you know, is there a certain point where you think it'll level out?

Steven Van Wie 22:40

Well, thanks so much.

Steven Van Wie 22:56

Well, I'm going to let Joey tell you what he just told me.

Joey Loss 22:59

So. So right now it closed the day at 94 times revenue, which is just a fantastical number to value a company at. And part of the reason they're focusing on revenue is because it's not overall a profitable company at the moment.

Steven Van Wie 23:12

You can't do times earnings or you'd have to give it to you with a check.

Joey Loss 23:15

Right. And so Elon Musk's track record, plus just the arena that they're in, the space, AI. I mean, all of these companies are going to go public without profits and they're going to sell for a ton of money. And so,

Joey Loss 23:28

you know, it's hard to comment on, like, what is a fair price because it really just has to do with your faith that they're going to be able to accomplish what they set out to accomplish and what other things have not come up yet that they are going to someday accomplish. If you look at the Amazon IPO back in 98, I believe they went public for a couple hundred million dollars. And at the time, they listed on their S1 that they were a bookstore online. And now look at what they are. Right? I mean, so I think people are looking for something like that, but yeah, it's just hard to say. And you have other factors that are gonna take place over the next six months, there's gonna be, on the buy side, a lot of demand from the indexes that will be slowly adopting SpaceX stock into the index. That's tens of billions of dollars that will be spent. So that should theoretically have a positive impact, you know, upward pressure on the price. At the same time, like Steve just said, you're gonna have all of these company stockholders who are insiders that slowly gain access to sell their shares. And they've been waiting for this liquidity moment that's going to have a downward pressure. How those two come together and how retail also plays in is anybody's guess.

Speaker 2 24:34

Time will tell.

Joey Loss 24:35

Yeah, time will tell.

Steven Van Wie 24:36

The only comment I've made so far this morning to Joey was it's too rich for my blood. At my age, I don't buy green bananas, much less a stock that could take years and years and years to make a good return.

Joey Loss 24:50

That took me a second. I don't know why that's funny.

Speaker 2 24:54

Well, you see those proverbial what if you invested this and whatever stock, you know, how much would it be worth today? You know, and of course, this is, you know, hindsight, you know, question, and I'm sure a lot of people are looking at that, you know, I mean, you know, the,

Speaker 2 25:14

the way they were boosting, you know, this IPO scenario, you

Steven Van Wie 25:18

know, they're, they're good at getting news. They make the news and then they tell you what the news is. I'm saying that out of pure admiration. By the way,

Joey Loss 25:22

Yeah.

Speaker 2 25:32

one other question, you know, about petroleum prices.

Speaker 2 25:38

Alberta's looking to become independent, you know, and their type of oil that we need, my understanding is, is what they are selling. Yeah. Have they in any way, shape or form connected their system to our system to pipe it out? Because they're, you know, they're, they're a landlocked providence and that that pipeline got

Steven Van Wie 26:02

canceled and there's a new one, a smaller one, the Keystone XL does not appear that it's going to restart, but there is a smaller one that they're going to be running into our country. And, you know, my instant reaction is annex them.

Speaker 2 26:20

Right.

Steven Van Wie 26:21

I would love that, but that's not going to happen. I think they're going to try to go independent, but if you go through the law in Canada about what it takes to secede from the union, so to speak, it's a long, lengthy process and it has to be approved by the legislatures and all that stuff, this is not going to happen now. It's more of a sign of Discontent.

Steven Van Wie 26:46

And by the way, I think the vote is in July and the voters in Alberta might not even agree, but they are very American friendly and they're very much freedom oriented people and they know what they've got. So it wouldn't surprise me if it passed there. But then that starts the lengthy process back in the other areas of the more population.

Speaker 2 27:09

Understood. Yeah, sounds right.

Steven Van Wie 27:12

Yeah. But you did bring in a pipeline then. Certainly helps. Long run. We're exporting right now, but the price is still high because the world's exports aren't coming out the way they should.

Speaker 2 27:25

What Trump was saying is that they were sneaking tankers in, filling them up by turning off their, their signal. I guess each ship has got a signal. Yeah, Transponder, you know.

Steven Van Wie 27:39

Yep. Yeah, they 100 million barrels got shipped out over the last month or so under cover of darkness that, you know, when that was released, just that one alone, you saw the price of oil drop about five bucks just like that. All people need to know that it's flowing and then you'll find what the real market price is for oil. That's all we need to know. So get Hormuz opened up and you'll see the first big drop and there's more to come.

Speaker 2 28:09

Well, it's amazing for him to even say that, you know, should it be going on? You know, I mean, it kind of blows everything. Okay.

Steven Van Wie 28:18

He is the master deal maker and he's got an ace in his pocket. You can count on it. Everybody who thinks they're a step ahead of him, they're just plain ignorant.

Speaker 2 28:29

Yeah. Yeah. Well, he's had a lifetime of performing and protecting it. So let me, let me throw this in for the trivia and I wanted to say 10%.

Steven Van Wie 28:35

Yeah.

Steven Van Wie 28:43

All right. And that is a little too high. So we have a, we have an absolute bracket there. For everybody else who's listening, let's see what you can do.

Speaker 2 28:53

Exactly.

Steven Van Wie 28:54

I appreciate that.

Speaker 2 28:55

I'm gonna let you go and I'm gonna listen to the rest of the program and enjoy talking to both you.

Steven Van Wie 29:00

Thanks so much. Enjoy this beautiful day.

Speaker 2 29:02

Yeah, right. Thank you.

Joey Loss 29:04

Take care.

Steven Van Wie 29:06

Okay, let's go back to this stock. The new millionaire stockholders. Right now. The things that are getting a lot of inquiries, high end real estate, second homes,

Steven Van Wie 29:20

Rolex watches and let's see. Oh, that private travel in private jets. And I caution these people and I wish someone would were able to lecture them. If you do convert your stock into money, first it has to be reduced by the taxes and then if you take a Big chunk of it and let's face it, $850,000,

Steven Van Wie 29:52

what's going to be left? Probably a little less than that once you sell your million dollars of stock. That doesn't go as far as it used to. Joey just told me a story about or no, it was Roger came in, said he has a daughter who was living down in the area we're talking about in San Francisco, and he went out to visit her and they were comparing real estate with where Roger was living for a fairly equivalent house or even much smaller, what might be a couple hundred ousand here was 5 million there. Now, if you want to buy a big fancy house and you're going to pay more than a million dollars and you've got less than a million dollars, that means you're going to have to put a mortgage on it. What does that do? It drives up your expenses, not your income. Let's say you do something other than that. You buy a Rolex watch and take a trip somewhere and it costs $200,000 overall, your income has not gone up. This is not an income producing thing in your hand. I read one story about one of the people who was the recipient of these things and she is intending to get a margin loan from a brokerage account that holds her restricted stock and she'll pay it back assuming she makes that much money when the restriction is gone and she can sell. But meanwhile she wants to take the money and spend it. Now, that is not an increase in your income either. Expensive things come with overhead. You see this all the time. Professional athletes and so on. They'll start accumulating cars and houses and such, and each one of them has upkeep. And that upkeep starts expensive and gets worse. Just would caution people that the highest and best use for someone who has that amount of money but has never been wealthy before and is not wealthy on the side of this, you're far better off to go find a couple of professionals, hopefully certified financial planners, and make a plan before you make a move.

Joey Loss 32:08

For sure, there's firms all over the country that focus exclusively on equity compensation. We have a handful of clients that have compensation from a variety of companies. But, you know, people underestimate the planning elements of this. It's like hitting the lottery in some cases. If you, if you ipo.

Steven Van Wie 32:25

Yep, we've got a lot of stories about that too. All right, one more quick break. Don't go anywhere. We'll be right back. This is the Van Wie Financial Hour. Welcome back to the Van Wie Financial Hour. I'm Steve Van Wie. 

Joey Loss 32:36

And I'm Joey Loss.

Steven Van Wie 32:42

And lines are open. 904-222-8255. And the trivia question. The reported unemployment rate is 4.3. What's the real one? And we know that 8 is too low and 10 is too high. So if you want to take a shot at it. 904-222-8255. All right, a couple of things I like to. Oh, here we go.

Steven Van Wie 33:03

Leroy.

Leroy 33:04

Hey, good morning, folks. How are you?

Steven Van Wie 33:06

Excellent. New.

Leroy 33:07

Hey, a couple of things. One, about two or three years ago, I was reading an article about the pipeline coming from Canada, and they said because they canceled the Keystone pipeline at that time, they were considering building another pipeline to the west coast of Canada to export to China and Japan. And. Yep, all that. I don't know if that ever happened

Steven Van Wie 33:37

or I don't know if it's completed, but I believe it's a done deal. That it will.

Leroy 33:42

Yeah, I mean, that was in the works for a while. I know that.

Steven Van Wie 33:45

Yep. I agree with you.

Leroy 33:47

Okay, I'll make a stab at your trivia question. I'll go with, like, seven and a half percent.

Steven Van Wie 33:56

Eight was too low, in case you missed that. So I'll give you a second shot.

Leroy 34:01

Wait a minute. You said eight was too low.

Steven Van Wie 34:03

Yes. Ten was too high and eight was too low.

Leroy  34:05

Okay, I'll go to five and a half.

Steven Van Wie 34:08

No, eight was. It's above eight.

Leroy 34:13

Oh, it's above eight. I'm sorry. Well, geez,

Steven Van Wie 34:18

You're taking it. Go ahead. Come on.

Leroy 34:20

Well, all I can say is nine.

Steven Van Wie 34:22

Well, nine's too high. Sorry about that.

Joey Loss 34:28

Sorry. You still help somebody? The bracket's getting. The bracket's getting clearer.

Steven Van Wie 34:31

Yeah, it is indeed. Okay, well, I appreciate your call. Thanks.

Leroy 34:37

All right, you guys have a good day.

Joey Loss 34:39

You, too.

Steven Van Wie 34:42

I love these little target zone things when we get an occasional question like that

Steven Van Wie 34:48

back to stupidity. You know the name. And let's see. Katie Wilson, I believe it is.

Joey Loss 34:57

Is that the mayor of somewhere in Seattle? Is that Seattle?

Steven Van Wie 35:00

You know the name? Yeah. Absolute commie, pinko, you know, types I hate. But anyway, she promised.

Steven Van Wie 35:13

Adam's calling into. I'm gonna finish this quickly. She promised there would be 500 shelters completed for the homeless by the time of the World cup.

Joey Loss 35:14

Oh, God.

Steven Van Wie 35:29

She opened 50. She is a true 10 percenter. Isn't that wonderful? Oh, by the way, average homeless on any given night, and it's only 16,000.

Steven Van Wie 35:44

Nice job, Mayor.

Steven Van Wie 35:47

Good morning, Adam.

Adam 35:50

Good morning.

Steven Van Wie 35:51

How are you doing? Good. What's happening?

Adam 35:56

Yeah, we're I'm down here in the beautiful Florida Keys and was listening to the show. It's been a good show. If someone can't get this trivia question right, there's no hope.

Steven Van Wie 36:11

Well, maybe there is, maybe there isn't. I don't know. You say if you can't get it right. Yeah, yeah, you can play, but you can't win.

Adam 36:22

Yeah, I'm ineligible, so I won't steal someone's guess, but someone should call in and take a stab at it.

Steven Van Wie 36:28

Yeah, it's between 8 and 9. There you go. And by the way, the range is 4 10. So you got a 40% chance. Or maybe it's 50%. I didn't do the math exactly because, you know, it's above 8.0 and below 9.0. Yep.

Adam 36:41

We'll have at it. No, I just wanted to. Just wanted to check in from my beautiful work vacation and say hello to everyone and let you know that I am listening and I'll be back on the air soon.

Steven Van Wie 36:55

Yeah. In fact, in two weeks from today, Adam is going to do the show remotely because Joey's out of town that day. So I'll be here and Adam will be where he is and use the same phone connection you've got because you just clear as a bell to me.

Joey Loss 37:12

Well, Adam, before you go, before you go. Elon Musk wanted me to pass along a thank you for making the IPO go so well from down there. He knows you're supposed to be relaxing,

Steven Van Wie 37:21

but, well, he does his best work.

Joey Loss 37:23

Appreciative of the 19% pop.

Adam 37:26

Yep, I did. I sometimes do my best work on vacation.

Steven Van Wie 37:31

I was starting to wonder that the first couple days this week it was looking a little dismal. I thought maybe

Speaker 2 37:39

It's been a little. Been a little up and down, but really not too bad considering.

Steven Van Wie 37:44

Now, as I said when we signed on, the word for the week to me was volatility. In fact, I got it. I can tell you a little bit about that. Did a little hand scratching this morning. This week The Dow moved up 359 a year ago this same week it moved up 565. So both good weeks, but last year was a lot better week than this one was. But the travel time, so to speak, I took the high and low on each of the five days and subtracted them and got the amount of distance that traveled in points, the total point value from low to high. I did that for all five days and it was 4,033

Steven Van Wie 38:34

points that the Dow changed in order to gain 359. But that's meaningless unless you say what's common. So I went back to the same week and when the Dow moved 565 a year ago this week, it only traveled 1803 to get there. So that proves my point that this volatility is really high. And if you are weak or faint of heart and you're watching this happen, then I can see where a lot of people might get scared. But I think this week shows you the perfect lesson. Don't panic.

Joey Loss 39:14

Well, and you're seeing rotation. So people aren't leaving, they're, they're changing where they are in the market. And then also it's worth remembering last year we were still recovering from the tariff come down. I mean, it took multiple market months to get back to what became new highs. This year it took 11 market days after the Iran started. I mean, it was like we thought it was the end of times. And then we're back to new time, like new all time highs three trading weeks later.

Steven Van Wie 39:38

That's amazing. Absolutely incredible.

Speaker 2 39:41

Yeah, there's actually a lot more fear in the market and amongst our clients and just in general, I think this year, last year, and that may have to do with us being actively involved in a conflict rather than just sort of a trade war, I think.

Adam 39:59

Yeah, it's true. We've been in harm's way, we've been shot at and we have lost people to those idiots over there. So I can understand people's concern. What you do about it is a function of your training, experience. And if you've got a good advisor who will do whatever you want to do after he argues with you to don't do it. How's that? Tell him how you feel, try to convince him of something and then you have to. When things come back, a lot of people would say you have to resist the opportunity to say I told you so. And I'm not really good at resisting that.

Joey Loss 40:42

Yeah, no. Well, Adam, I can't help but notice how Steve is encouraging that, knowing that you're the one that's going to field that.

Steven Van Wie 40:50

That's right. I'm passing the buck. You know, there's a very fine line.

Joey Loss 40:54

Steve's handing out the manual knowing that you're the arbitrator.

Steven Van Wie 40:57

There is a very fine line between passing the buck, pretty much how it's always gone, delegating authority, passing the buck, who knows? All right, Adam, we've got another call on the line. Tell the family hey and be safe out there.

Adam 41:12

Yep. Keep up the Good work. Bye.

Steven Van Wie 41:14

Thanks. Bye.

Steven Van Wie 41:16

Mary.

Mary 41:18

Hi. I was going to take a stab at the trivia question.

Steven Van Wie 41:22

Okay,

Mary 41:24

How about 8.5%?

Steven Van Wie 41:27

8.5. Let's see. Since the actual number is 8.4 and I had plus 2 or minus 2, yes, that will work. We have a winner. All right, is this the Mary I know or not?

Mary 41:45

Maybe I don't go to your firm.

Steven Van Wie 41:48

Okay, that's not the one I thought it might be because you sound a little bit like her. All right, I'm gonna put you on hold and Roger will get your. Your address and such, and we will send you a little something from Mr. Lloyd.

Mary 42:00

Okay, thank you. Thanks.

Steven Van Wie 42:01

Appreciate the call. Yeah, that whole thing that's called U6, by the way, the unemployment rate, that includes the marginally attached to the workforce. And the reason they stopped using it was because the politicians like the lower number better. It's like GDP and gnp. When I grew up and got educated in economics and so on, we always used gnp, but we had huge exports and, and that made us look even better than GDP would. So for those of you who don't know the difference, I got a quick, simple thing here. It's the difference between location versus nationality.

Steven Van Wie 42:43

GNP measures the value of everything produced by a country's citizens and businesses, regardless of where they are in the world. Now, here's a couple examples. A Japanese factory in the US contributes to US gdp, but not to our gnp, but it also contributes to Japan's gnp. If that's confusing. Yes, that's confusing there. And here's one. An American working in London contributes to the UK GDP but to the US GNP because they provided a service that is. Is done by an American. Now, if I don't have you all confused enough by now, I'll try harder next week. All right, thanks to everybody who is calling in today. And I hope that you are

Steven Van Wie 43:39

going to make this a habit, if you haven't already, and that we can get together again next week. I've got a. An occasion coming up in a couple of weeks when Adam and I are going to be on. That will be the last broadcast for me of the 24th year on radio. So in three weeks, I'll come in for the first broadcast of my 25th year starting. So just a little trivia question of its own, I guess. All right, we had a good time today. Thanks for everybody who called and participated, and we hope to see you back here again next week. Be good out there. Be careful. This is the Van Wie Financial Hour.

Joey Loss 43:59

Wow.