#97 – From Baby Larry to Bitcoin: Discussing Today’s Most Searched Financial Topics

Wes Moss [00:00:27]:
Based on the long running WSB radio show, this Money Matters podcast is tailor made for both modern retirees and those still in the planning stages. Join us in this exciting new chapter and let’s journey toward a financially secure and joyful retirement together. Jeff Lloyd how excited are you? As we we are in the holiday season. This is the Thanksgiving week. This is so exciting. I’m so thankful to be here.

Jeff Lloyd [00:00:57]:
I’m thankful to be here. I’m thankful to our listeners. I’m thankful to the people in the studio, Marissa and Mallory. I’m thankful for Baby Larry.

Wes Moss [00:01:06]:
Thankful for Baby Larry.

Jeff Lloyd [00:01:08]:
I’m thankful for Baby Larry.

Wes Moss [00:01:09]:
We came up with some brand new things this year just because of Baby Larry. It was the zero year saving plan I think we did where because people are living longer and cost of inflation. Remember there was a I think it was a golden Goldman Sachs report about how to make money last and they said maybe just start early and I thought wait, maybe Baby Larry starts right.

Jeff Lloyd [00:01:29]:
Start saving as a baby. Was there a solution to retirement?

Wes Moss [00:01:32]:
And there’s nothing wrong with starting out with baby steps because if you’ve got a 60 year time horizon, my goodness, I love that. But let me go over the topics we have today. I call this Thanksgiving Economics 2025 what we are thankful for in this economy which is number one a resilient economy to corporate earnings 3. Cooling inflation 4. Innovation driving future growth 5. Opportunities created by volatility. The downside of what we’ve seen this year the government has opened back up. We’re thankful.

Wes Moss [00:02:03]:
I don’t know if I’m super thankful about that one. I felt kind of liked having the shutdown.

Jeff Lloyd [00:02:07]:
I think a lot of people are thankful to have their jobs back and getting paychecks coming in.

Wes Moss [00:02:12]:
I couldn’t agree more moderately I’d say moderate to slightly high interest rates. We’re going to go into all these rising dividends from quality companies. The dividend numbers are just continue to be like a bulldozer with a little extra pep all at the same time. And then global confidence in the United States and the US dollar and we have some statistics around all of that. We have this story that is still blows my mind from the Wall Street Journal. There was a guest Columnist who talked about how you should convert your entire IRA into a Roth all at once. Supposedly he and his team did the math, which we figured out. We had to back into how they did this math and said that if you have $1 million IRA, you should just convert it all at once.

Wes Moss [00:03:07]:
And I love the line in this that I can’t believe they actually put into writing, quote, if a big tax bill is no problem, this is the strategy for you. If a big tech, and this is at a million dollar conversion, 37%, it’s going to throw you all the way into the top bucket Federal. Imagine if you’re a 10% state, we’re less than 5, but put on another 5, you’re at 42, 43, could be 47%. Imagine a 400,000 or almost 500,000 tax bill that’s due in a year from your after tax account. And, and they simply say if a big tax bill is no problem, what.

Jeff Lloyd [00:03:47]:
How many, how many people are going to answer that with like, yeah, oh yeah, a bigger tax. Well, that’s no problem. Bring it on. I want to write a bigger check to the irs, please.

Wes Moss [00:03:57]:
And the assumptions, the assumptions are flat marginal rates which make no sense. They don’t increase what you’re paying with such a big conversion and then they assume you’re in the same tax bracket of the future. While most retirees, the vast, vast, vast majority of retirees that I work with have lower tax brackets in retirement than they do in their peak earnings years, which just makes common sense. It’s almost as though they did this in a spreadsheet. Maybe you know what they did?

Jeff Lloyd [00:04:25]:
They did it in Excel and it’s not real life.

Wes Moss [00:04:28]:
Worse, they did it in artificial intelligence. I bet you a human never looked at this. That’s what it is. And you know what they call that? They call that work slop. You just throw something to GPT, one of these AI models, it spits out everything and, and it’s a B minus. That’s what you get from artificial intelligence. That’s as good as you get is a B minus. That’s the top tier.

Wes Moss [00:04:53]:
And if you’re not looking at it, there’s a new term. And I don’t really like these new corporate phrases. Quiet this and loud that. And I don’t even like this one, but I see it. It’s called work slop. And it’s when you’re relying on AI to generate something. And that seems like what happened here, that’s all this is workslop.

Jeff Lloyd [00:05:13]:
And we talked about this, this week. Do you remember us talking about that article that I read that said from a content creation standpoint, AI is generating more content than humans now, meaning that.

Wes Moss [00:05:29]:
On any given web page you’re on.

Jeff Lloyd [00:05:31]:
It’S that content is being generated from AI and not more than humans. More than humans.

Wes Moss [00:05:39]:
You know, no wonder it’s getting so bad.

Jeff Lloyd [00:05:40]:
You know where you’re not getting that.

Wes Moss [00:05:42]:
Not here, not today, from real humans. Is real Jeff.

Jeff Lloyd [00:05:45]:
This is real Jeff and real west talking to you.

Wes Moss [00:05:47]:
Yeah, definitely is. Now, if you could fully clone voices, which you can get it to a B, again, a B minus, we could write up a script and have AI go back and forth and do the show. But again, it’s not. It’s still. It’s like a B minus. You could. People could tell and it wouldn’t be.

Jeff Lloyd [00:06:06]:
People can tell. People are smart. They can sniff that we have trouble.

Wes Moss [00:06:09]:
Enough making this work and making this a good show, doing it actively, let alone in a work slop way. Speaking of, before we get to economic or what we’re thankful for and go into the numbers around this economy, this market, the numbers around Thanksgiving travel are always. They’re fascinating to me. 82 million people projected to travel this week. That’s from AAA, at least 50 miles or more from home. And that’s from this coming Tuesday through next Monday, December 1st. I don’t really know how they. Maybe they just do this on a survey basis.

Wes Moss [00:06:46]:
But the forecast includes another 1.6 million travelers in addition to last year’s travel schedule. Should be an overall record. It’s Thanksgiving, as we know, is the single busiest holiday travel compared to others like Memorial Day and July 4th. 73 million people will travel by car. That’s 90%. And this is. This surprised me a little bit. 90% of Thanksgiving travelers are in the car.

Jeff Lloyd [00:07:14]:
You know what else we probably think.

Wes Moss [00:07:15]:
Wait a minute, 90%. Not when you’re running through the airport. But 10% of 82 million is 8.2. So it’s still 8. 8 million people fly during that period of time.

Jeff Lloyd [00:07:30]:
And what also surprised me in the report, given the. The recent government shutdown that we had, and you heard all the stories about trouble with air travel and all that, there are actually more people traveling this year through the airport than there were last year. I actually thought there would be less people traveling, I wonder if through the airport than last year.

Wes Moss [00:07:50]:
The last couple of weeks I’ve had to do a little bit of travel and it was pretty slow and I had to rent a car. And the guy at the desk said that they were super busy because people were opting. Now, this is a couple of weeks ago prior to the government shutdown ending and there was still no real end in sight. People were opting. A, you had 10% or more flights canceled. B, you had more people opting to drive. And I had a couple airport runs that were surprisingly light, which was magical. But not this upcoming week, folks, as we’re, as we’re trying to.

Jeff Lloyd [00:08:25]:
Did you have any air cancellations or delays?

Wes Moss [00:08:28]:
Luckily, now.

Jeff Lloyd [00:08:29]:
Okay, that’s good.

Wes Moss [00:08:29]:
It was fortunate. So we also had Nvidia earnings this past week. Biggest company on the planet reported earnings this past week. And their CEO was. We’ve been worried about an AI bubble. Some have called it a rational bubble, some have just called it a actual bubble. There’s this circular funding worry where companies are investing in these giant startups and then the giant startup has now money from the company to then go pay for their cloud services or for their chips. And there’s this circular worry of if one of those players goes down, does it bring the whole web down? And we don’t know that yet.

Wes Moss [00:09:09]:
But Jensen Huang is saying, look, there’s been lots of talk about an AI bubble, but from their vantage point, we’re seeing something very different. He didn’t just say, we’re not in a bubble. He just said, no, something very different. Of the different categories they sell chips to, they’re all growing and they’re having trouble even keeping up with demand. So we’ll see. The other thing that is been on full display over the last couple of weeks is the price of bitcoin. And bitcoin earlier this year got up to about 125 bucks. And it has 125,000.

Wes Moss [00:09:43]:
125,000. Did I say bucks? I meant thousands. 125,000 per bitcoin, but it already has been down 30%, which is a big correction. It’s more than a quote bear market. But you pulled some of the numbers on max drawdowns over the last decade. And this is what bitcoin does is why it’s so hard to hang on to this asset.

Jeff Lloyd [00:10:07]:
It’s down 30 plus percent. That is not uncommon for bitcoin. And we ran kind of max drawdowns for bitcoin intra year going back to 2015. And look at some of these annual max drawdowns. 2015, 42% next year, 25% next year, 31% in 2018, max drawdown over 80% next. I know I sound like a broken record. Next year. 48%, 53%, 53%, 67%.

Wes Moss [00:10:36]:
These are negatives.

Jeff Lloyd [00:10:37]:
Negatives, these are, these are drawdowns.

Wes Moss [00:10:39]:
When we look at the S and P. To put this in context, we look at the s and P 501 of our favorite charts as a reminder, when we’re going through corrections, which do happen all the time, the average intra year drawdown for the s and P500 is around 14% or 14 15% depending on how long of a time span you’re looking at. That’s a percentage. It’s tough for people to stomach. So you’ve got to have an iron stomach to be a long term investor and hold one of these cryptocurrencies. And this is the most established cryptocurrency. There are dozens of others. CNBC still shows ether they show, I think now they’re starting to show XRP or there’s several.

Wes Moss [00:11:21]:
There’s not thousands of them like there used to be. I think we did a show a couple years ago, there were thousands of different cryptocurrencies that has obviously gotten way whittled down. But even for the most established, which is Bitcoin, tremendous volatility to be a long term investor there. But they’ve also been rewarded. What are we thankful for? Jeff Lloyd There’s a long list of this. We have 10 areas that go back to markets, the economy. We’ll start with number one. And that’s just the resilience.

Wes Moss [00:11:52]:
If you’re looking macro wise and I studied economics, I find myself always defaulting back to what’s the big picture, what’s the aquarium? If the economy is in aquarium and you drop something in over on this side and on this side, eventually it finds equilibrium in the aquarium. So something over here upsets eventually something over there, but eventually the water finds equilibrium. And with all the different variables and the, the competing forces we’ve seen in 2025 so far, we continue to see real growth in 2025. Last quarter was almost at 4%. I just pulled Atlanta fed GDP now, which it’s tracking about 4.1, 4.2% growth for this year for the quarter and even with the cooling labor market, we got a delayed jobs report. We added 119,000 jobs. Unemployment rates still very low. On a historical basis it’s ticked up but it’s still at 4.4%.

Wes Moss [00:12:53]:
That’s a low, still a very low unemployment perspective relative particularly with all the chatter of AI taking all of our jobs hasn’t happened yet. Number two on our list Corporate earnings. Corporate America keeps doing what it’s supposed to be doing or sometimes does very well, which is adapting and then continuing to make money and growing earnings. Q3, which we’re pretty much through that S&P 500 blended year over year earnings growth about 13%. That’s a really rapid pace and that’s the fourth consecutive quarter of double digit earnings growth. That’s a big deal.

Jeff Lloyd [00:13:35]:
I think that’s a big deal. And I think this might have taken some people and some investors by surprise is double digit earnings growth. In the face of all the economic headwinds that we’ve been facing this year. Whether that’s political, whether that’s tariffs, whether that’s continued inflation, yet tamer inflation, but continued inflation. I think seeing that double digit plus growth has really been the backdrop of a strong economy in a strong market that we’ve seen year to date.

Wes Moss [00:14:08]:
And that just to put some context around that, when we’re talking about earnings growth, we’re saying that this is collectively as the S&P 500. Now part of that is some of the big technology names really add a ton because they’re growing really quickly still and those are big numbers. So they’re lumping on giant earnings numbers. But collectively to have the 500 largest companies in America, so anywhere from, let’s call it large battleships to tanker ships to massive cargo ships to have that group grow at a double digit pace, it’s, it’s really kind of an economic miracle to see that continue. More Money matters straight ahead. The average baby boomers for 1k just under $250,000. Gen X closer to 200,000. How do your retirement savings stack up? No matter your age, the right moves today can completely change your financial future.

Wes Moss [00:15:07]:
That’s why we created Retirement Planning at Every Age. A free guide with smart strategies, key milestones and steps to stay on track. Download your copy today@yourwealth.com resources. Let’s get your future on the right track starting today. So we’re thankful is the theme here. For one, a resilient economy continues to grow at actually a pretty serious rate. We’re not talking about 1%. We’re not limping along.

Wes Moss [00:15:36]:
U.S. economy probably will finish this year with a three handle, which is still really, really strong for the U.S. economy. For first, a mature economy our size. Two, corporate earnings continue to grow. We’re going to probably finish the year at plus 13% over last year. That’s significant. We’ve had inflation, the trend of inflation.

Wes Moss [00:15:56]:
Number three, inflation isn’t dead but it’s a very different world today than the 9% CPI we saw a couple of years ago headline CPI is about 3 still in that 3% range. But think about where we were in 2022 at 8. 9% and with no end in sight. PC the Fed’s their measure was well into the 2 range last year and continues to be get we’re not close to. We’re closer to three than we are at two but it continues to be a better inflation environment. So prices are still higher than we like but the rate of increase has come way down and paychecks are finally starting to look solid. We saw the Atlanta Fed wage growth trackers running a little over 4% so.

Jeff Lloyd [00:16:46]:
Continuing to see wages outpace just by a little bit.

Wes Moss [00:16:50]:
Number four innovation driving future growth. We’re thankful for that. So under the surface the US is is just rewiring itself for the the next decade. Of course what first comes to mind would be a data center build out but that’s not the whole story. It’s data center build out and then all the ancillary mechanisms that need to also focus on that. So think about the H Vac systems that need to go there, the power systems that need to go there. The United States is firing nuclear power back up. I saw the Energy Secretary this past week interview with him and there’s just tremendous growth in nuclear over the next several years as that technology.

Wes Moss [00:17:36]:
It was interesting to talk about how it even though it’s such an efficient technology it all the Three Mile island incident which I didn’t realize this and being from Pennsylvania I, I remember feeling somewhat close to home but I still grew up thinking that people died from that and there were health ramifications and evidently there were not. Now that was. I don’t know if that is I have a double triple fact check that but evidently there it was more that the partial nuclear meltdown that I think was reactor two at Three Mile Island. It just really scared folks in the United States. It was a, it was a scary time when anything the word nuclear freak people out because they thought nuclear. I remember as a kid the COVID of Time magazine. This must have been in the 80s like as a little kid there was a Time magazine cover that I’ll never forget that showed it was kind of a chart of how many nukes we had, how many nukes Russia had. It was just still scared me.

Wes Moss [00:18:35]:
It scares me to this day to think about it.

Jeff Lloyd [00:18:36]:
I was about to say it scared you back then and I think that name alone just continues to scare people nuclear energy. It’s almost like they need to go through a re rebranding and rename the type of energy because I think it just has that negative connotation it is associated.

Wes Moss [00:18:55]:
But again there’s a lot of build out that’s happening right now and you’re going to see more and more nuclear power online. But again we’re rewiring the United States. Whether it is from data centers, whether it’s electricity utilities, I’m thankful for that Build out Number five Opportunities Created by Volatility Even though if you were to start at the beginning of this year, take a nap until this weekend, you’d look up and say oh, the market’s done pretty well. Not a crazy good year in markets, but pretty well. Dividend stocks have held up with the tech heavy S&P 500 so we’ve seen broadening. You haven’t had to be just intact to do well this year. And fixed income is bonds have had a good year. Bonds are up five to six and a half percent total return.

Wes Moss [00:19:43]:
That’s pretty good. And so we’re thankful for that. It’s been a good year for markets, but at the same time we had some volatility. We had a full blown 20% correction in April, which was technically and not technically all at the same time a bear market. But it was a huge correction and anytime you have volatility it gives folks opportunity. So every scary down, day, week, month, call it even, year by definition is a better entry point for people to continue to accumulate. And that is not necessarily a bad thing. It’s actually one of the fundamental traits that the markets have to have.

Wes Moss [00:20:27]:
They’ve got to have that risk in order to achieve the double digit rates of return we’ve been able to enjoy as long as you’ve been a patient long term investor over time.

Jeff Lloyd [00:20:38]:
Not that I’m saying we told you so here on Money matters, but we told you here on Money Matters back in March and April when we had elevated levels of volatility with the market sell off, that created good buying opportunities for stocks on down the road.

Wes Moss [00:20:55]:
Look, I had a family I work with this week said something about the sell in May and go away. Now we’re in the good time of the year. It’s like hey, it’s November, isn’t this the good time? And I said look, he said I read your article about this is a good time of year. And I said yes, historically that’s true, but it doesn’t mean that it’s going to happen this Year. And it doesn’t mean that May and go away is bad this year or good. It’s just if you collectively look over a hundred years. I think those are interesting and I like the almanac nature of a lot of these historical studies we look at. But one that has played out very well is that is what you’re talking about, Jeff, and you brought that to money matters back in April where the vix, the Fear Volatility index, when it gets to a certain level, 45, 50, we’ve almost never, I don’t think we’ve ever seen a year later markets, they’re not higher because in order to get to that level you’ve got to have a lot of selling and then you gotta have, you have to have some panic selling and a lot of panic selling to get the VIX at that level, you’re out.

Wes Moss [00:22:01]:
It has always been, of course, no guarantees, really a good entry point. We’re nowhere near that VIX level today, but we were in April. And those investors who either stayed in or added money during that period of time have had a lot of success in 2025. This one I’m a little mixed on. I am thankful. Number six, the government has opened back up. And I know it’s awful for people to not be getting paid during that period of time. And it shows the dysfunction of our Congress and it just, it’s.

Wes Moss [00:22:32]:
There’s a lot of sad commentary around a government in a country like ours, the greatest country on the planet by far, to have the government not open for what, 43 days. So there’s some sad commentary around it. I’m thankful that we’re reopened. It was kind of peaceful. It’s kind of peaceful during that period of time.

Jeff Lloyd [00:22:51]:
It was okay, 43 days not having to hear from everybody.

Wes Moss [00:22:54]:
It wasn’t the worst thing not to have to hear from five congress people every single morning. The September jobs report we get back because you know, this is like ancient history. But we just got the report this past week for September. So think about how, I mean, here we are, it’s Thanksgiving and now we’re getting, we get a jobs report. It’s like hey, four years ago, but it was September’s job report. 119,000 new jobs, unemployment rate at 4.4%. Of course delayed by the 43 day government shutdown. We will not get an October number.

Wes Moss [00:23:29]:
We will not get an October number. So agencies are back up. That means we’re going to start to get some serious data. And we already have jobs data, inflation data, GDP data, And that’s essential for the Fed, very data dependent, to be able to do their job. Wall street hates two things, surprises and silence. Government reopening at least fixes the silence part. We’re on number eight. Jeff Floyd, Rising dividends from quality companies.

Wes Moss [00:24:04]:
Dividends are the quiet compounding machine in the background. And if you’re an income investor, you want that machine to just keep going. So far this year, S&P 500 dividend growth running at about 6.9% year over year. That is the rising payouts going up. You’re getting dividends, but they continue to rise. That’s why dividend growth has been such a good elixir to battle inflation.

Jeff Lloyd [00:24:34]:
And that’s one of those things that we talk about when we invest in companies that pay dividends. Yes, we like investing in companies that not only pay a dividend, but also try to grow their dividend over time, whether that’s just a few cents increasing each quarter. We like companies that pay a dividend and grow their dividend.

Wes Moss [00:24:53]:
So if you’re looking at dividend stocks and The S&P 500 dividend payout is very low because the market has gone up and not everybody pays out. Not all companies, of course, pay dividends or are high dividends. The yield on just The S&P 500 is pretty low. It’s 1.2% approximately. So dividend stock can be 2%. 2 to 3% is considered a dividend stock because it’s on a relative basis. So if you think about a 2 to 3% dividend yielder growing at 6 to 7% annually, long term, dividend investors, they’re quietly getting these raises just year after year after year. What’s the just.

Wes Moss [00:25:32]:
Mathematically, if something’s growing at 7%, it doubles. Well, at 7.2% it doubles every 10 years. Number nine, continued strength. The U.S. consumer. Consumers may be grumpy when it comes to the sentiment indices, but they’re still swiping their credit cards, they’re still spending retail. Real consumer spending grew about 2 1/2% annualized last quarter. That’s still, of course, the main engine of gdp, plus all the capital expenditures that we’re seeing, the labor market as far as that’s concerned, which is we have to have jobs in order to spend.

Wes Moss [00:26:14]:
Still right around equilibrium, 7.2 million job openings in the US and that is very much in line with the amount of folks that are looking for work. So that vacancy rate is equalized, which I love. Tracking that again, we talked a little bit about earlier Wages Fed, the Atlanta Fed Wage Growth tracker showing about a 4 or 4.1% growth in wages and you’ve got to have that in order to have consumer spending to go up. Do we have here? Number 10 global confidence in the US and the US dollar.

Jeff Lloyd [00:26:44]:
Jeff Lloyd I think when push comes to shove, when global investors are thinking about where are they going to put their money. Number one on the list back in.

Wes Moss [00:26:55]:
The USA, the dollar globally still makes up almost 60% of foreign exchange reserves. That’s way ahead of the euro. The euro’s at 19%. The go on is 2.2%. The foreign investors hold anywhere from 8 and a half to $9 trillion of U.S. treasuries. That number has actually gone up over the past year and I think that we got to number 10 that we’re thankful for because we got a wrap and we’re excited about this week. You don’t have to travel.

Wes Moss [00:27:27]:
I’m not traveling. Happy to be here in the city. For those of you and if you’re in the 82 million folks traveling in this upcoming week, travel safe, enjoy the holidays. Thank you so much for tuning in. You can always find us@your wealth.com that’s y o u r your wealth.com.

Speaker C [00:27:51]:
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Speaker C [00:28:39]:
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