Welcome to another episode of The Cents of Things with Ron and Jeff! In this episode, we dive into the world of finance, discussing the latest economic trends, the market mania surrounding NVIDIA, and some interesting historical facts. We cover everything from the valuation of tech giants to the divergence in economic indicators.

Join us as we analyze the Chicago business barometer, ISM manufacturing data, job openings, and labor turnover statistics. We will also touch on the recent surprises in government job hiring and ADP unemployment numbers.

Tune in for insightful discussions, market insights, and a few laughs. Don't forget to subscribe to our channel and leave us an upvote if you enjoy the content. Your support means the world to us! Stay informed and entertained with The Cents of Things. See you in the next episode!

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www.AtlasBuildsWealth.com

Welcome to the Cents of things podcast, where your money talks

2

and we listen, join host Jeff Kickel

and Ron Lang as they explore the

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economy, financial planning, and the

stock market, adding a splash of fun to

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make your financial journey engaging.

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Each episode, they break down

complex topics to give you the clear

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edge in your financial decisions.

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Stay tuned and let's make

Cents of things together.

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Good morning to the Cents of things.

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It's Ron and Jeff here once again, and we

are kicking off another couple of episodes

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of the Cents of things, talking a little

bit about what's going on in the world,

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what's going on in the economy, and maybe

a few funny things to get us kicked off.

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Ron, how you doing, brother?

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Ron Lang: Good morning.

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So basically we're just going to spend

the next two hours talking about NVIDIA.

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Is that right?

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Jeff Kikel: Yeah.

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And it's comparisons to

other things in history.

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Ron Lang: Yeah.

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All right.

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We'll have to set up a separate episode

for that, but I think the mania is

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getting a little out of control.

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Jeff Kikel: I'm with you.

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I'm with you.

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I just, once again I look at it

and, now we're down to basically

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the, we were the magnificent seven.

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Now we're down to the

magnificent three at this point.

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And you've got, you've now got

Nvidia Apple and Microsoft in the 3

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trillion range, which is just insane.

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Ron Lang: And yeah, that's another episode

we should do compare one of those stocks.

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Compared to the European market,

the Asian market, one, one company's

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market cap is larger than all of that.

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Jeff Kikel: Yeah.

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Yeah.

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And they were saying, and I think

I forget what the number was.

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It's 35 billion.

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NVIDIA is, close to eclipsing

Microsoft within 35 billion.

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And here's the crazy thing.

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I

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Ron Lang: hear some people coming out and

they're like, Oh, you could justify that.

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And then everybody's got their own

FACAC then I'm telling you, I got, I'm

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literally, I got PTSD of 97, eight, nine.

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Listening to people talking about

valuation of nvidia and not that

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it's a bad company and it's not

like it's not making money, right?

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microsoft and intel we're making

money in the mid to late 90s, but The

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pe and the valuations were absurd.

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I don't know where nvidia's pe is now I

know it was like 60 or 70 and then I hear

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people that are valuation people talking

about Yeah, you could make a case for it.

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I just know that two things one They

don't want to say it's too high or the

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valuation's out of control because if

it doubles from here, they look like

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a schmuck Yeah, and or they're in bed

with fund companies or other people

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that Have a big share of nvidia stock

and they would basically be like, what

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are you killing the golden goose for?

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Jeff Kikel: Yeah, the golden goose.

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That's

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Ron Lang: why I don't trust some

of these analysts coming out.

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Jeff Kikel: I don't trust

most of them, quite frankly.

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I think they're, it's a cartel and

they just all kind of work together

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in collusion a lot of times.

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Yeah I just I'm sorry.

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I don't buy most of the analyst research.

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I don't use the analyst

research at all in my practice.

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I do my own research because

I just don't trust anybody.

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Ron Lang: I actually we talked about it.

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I was originally one of the beta testers

of a website that holds the Analysts

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feet to the fire and they rate them

based on their price targets within

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a Within a calendar period of time,

maybe i'll share it with you Maybe i'll

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share with the audience at some point.

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I don't want to make it look like i'm

advertising, but I will tell you It's

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a damn good Bible for for not only

information, but following analysts

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that are truly worth their salt.

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Sure.

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Yeah.

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And there's not a

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Jeff Kikel: whole lot of them.

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Ron Lang: Yeah no.

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So we retired the bad business

decisions for a little bit.

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And so for the next, I think four

or five podcasts that I'm going to

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focus in on are just some fun facts.

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And these are some interesting ones

because I will tell you i'm a history

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guy I love nostalgia And every now

and then you come up with something.

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I remember that i'm like really so here

is here is something interesting So

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everybody who hasn't seen the titanic?

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Actually the original necklace that was

on You know in that movie was actually

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worth 10 million dollars Obviously

back in the day with the titanic

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people, people were like, look at this.

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I don't know how much they, I don't

know if they even said how much,

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how valuable it was back then.

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If you look over the next hundred years,

but I thought this was interesting.

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It's 171 carat 171

carat Sapphire necklace.

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It was a beautiful necklace and everybody

probably thought it was a stage prop.

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Yeah.

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I thought it was interesting.

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Jeff Kikel: I didn't realize

it was actually real.

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That's nuts.

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That's my point.

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Ron Lang: And at the end of the

movie, she threw it into the ocean.

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I know.

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I don't think that's a spoiler

alert for anybody that's listening.

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That's a good one.

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Okay.

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That was it.

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the Godfather, right?

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Yeah.

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Or at least the first two movies,

the third was pretty poor.

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But then it was eventually changed.

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But if you think about it, the book was

called The Godfather, so why would they

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have called the movie The Godfather?

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Yeah, why would you have changed it?

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But yeah.

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Thought that was interesting.

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And my last fun fact.

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The matrix code, when you see the

movie, and I only saw the first one, I

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fell asleep in the second one, but the

matrix code is actually sushi recipes.

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Okay.

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It's not a code at all.

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It's a series of sushi recipes,

cleverly disguised to create the

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illusion of a complex code in the

digital world of thought that I'll be

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very blunt with you, I like to cook.

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I don't follow any recipes.

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I got my things that I

like to do when I cook.

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And I'm thinking to myself, when you're

making sushi, is there really a recipe?

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Jeff Kikel: Yeah.

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Is there, theoretically, yeah,

because they're, they have, similar

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things that they put into it, but I,

nothing that you really have to follow

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Ron Lang: the Sriracha mayo or, whatever.

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But my thing is okay,

you take a picture of it.

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That's how you make it.

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Yeah.

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Huh?

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What you're not cooking the fish.

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You're not sauteing the fish.

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You got rice, you got seaweed,

you got fish, and then you

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got a couple of other things.

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I'm thinking to myself, how

complex are there recipes?

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Apparently it's more

complex than you thought.

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Obviously, obviously if you watch the

movie, you're not going to be able to

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stare at that code long enough to figure

out what the hell those recipes are.

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I,

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Jeff Kikel: I couldn't get past it.

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I started watching it, and I like Keanu

Reeves, and I like, Lawrence Fishburne,

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but I just couldn't get past the movie.

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Ron Lang: The crazy thing is,

and I did enjoy the first movie,

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but like that movie, like many

other similar type of movies.

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At some point you just get tired

of a 10 minute drawn out fight.

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What else is exciting with

him running through the air,

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20 feet kicking and punching?

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How many times can you watch that

in a two and a half hour movie?

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Anyway, I got a little tired of that.

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Okay.

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On to some serious stuff.

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So I thought this was interesting

every now and then I'm able to get

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some interesting charts that, and

I know we've been talking about

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this for a while, but this is the

the Chicago business barometer.

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It's also part, you don't include some

of their PMI information, but I thought

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this was interesting because this isn't

going back the last 10, 20 or 30 years.

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This is going back over 55 years,

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Jeff Kikel: 70.

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Yeah.

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Ron Lang: Looking at all this.

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And we talk about this all the time.

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We're not making this up, right?

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These are actual facts and figures now.

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I know we joke around quite a bit

Especially that one time when we chastised

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the atlanta fed for coming out with an

outrageous gdp number But everybody else

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was half of that amount or a negative

amount and they were almost dead on

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Yeah, Look again, I don't know how they

even come up with that, but these are

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actual numbers with their charts And

I don't know what is this telling us?

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We know we all know that the computer

is strong a computer the consumer is

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strong Spending money they got jobs.

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It's flowing into their 401ks They're out

spending money whether it's money they

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have or they don't and it's on credit.

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But

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Jeff Kikel: yeah

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Ron Lang: All the other economic

numbers have been trending down.

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And this chart is telling you a lot.

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Other than in 1990, everything came

down to this 35 ish level telling

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you that a recession was pending.

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Jeff Kikel: Yeah.

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Ron Lang: Thoughts.

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Jeff Kikel: I, once again I think our

next episode, I'm going to have some stuff

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on this, but I totally agree with you.

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I think it is.

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To me is starting to show and it's in

the cracks are widening in a lot of

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different areas, And we've been saying

this for a year now and I think a lot

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of people have been saying it for a year

that when do we start to see a recession?

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And, you and I both have the same feeling

about this whole soft landing, hard

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landing recession, whatever it is it's

going to happen, it's going to happen

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and it's starting to show signs across

multiple different areas, not just.

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Okay inflation's higher.

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Okay, this is high.

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It's just starting to show

in a lot of different areas.

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And I, once again, I think

it's you've got to be sure that

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you protect in those cases.

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Unfortunately, you also have to

you can't just sit back and go I'm

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just going to I think it's coming.

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I'm just going to stop.

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Stop investing because it'll

just beat you down and the market

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will keep running at this point.

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And, I think what you're seeing in the

market is when it was looking like.

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Okay, we're not really, we're not slowing

the market started to get a little bit

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soft because, okay, it doesn't look like

the feds going to lower rates and now all

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of a sudden, we've seen some soft numbers

and now the market's rocketing up because

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obviously the feds going to reduce rates.

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If you look at history,

that is probably not true.

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They're going to wait and then

it's going to go there for longer.

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Yeah, higher for longer.

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They keep saying it.

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They're going to keep

it higher for longer.

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That just means that they're probably

going to do what they've always done in

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history, which is to massively overshoot

the wrong way, because they waited for way

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too long to let inflation get out of hand.

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And they're probably going to wait

too long and it's going to cause

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the the market to go the other way.

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Ron Lang: Always behind the curve, but I

think it was Warren Buffett's, infamous

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quote, the market could stay irrational

longer than you can stay solvent.

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Jeff Kikel: Yeah.

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Then

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Ron Lang: you

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Jeff Kikel: have

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Ron Lang: money.

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Yes, absolutely.

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Jeff Kikel: Totally agree

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Ron Lang: with

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Jeff Kikel: him on that

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Ron Lang: too.

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Absolutely.

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All right.

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My next chart is taking their

the Chicago business barometer

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and their ISM manufacturing.

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And for the most part, it's almost

stayed lockstep and converged.

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And look what happened starting

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It diverged.

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Yeah.

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What is this telling us now?

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It's not necessarily the divergence.

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It's the depth of the

divergence to the downside.

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Now, again, and I don't know if

you know the answer to this or not.

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I do not because there, I know that

different feds have different ISM numbers.

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I actually never paid attention

to the quote unquote Chicago I

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accept the Chicago PMI numbers.

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No, we've been talking

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Jeff Kikel: about

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Ron Lang: Philly

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Jeff Kikel: fed,

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New York fed, Richmond,

all that I've really had

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Ron Lang: the New York ISM

index, manufacturing or PMI.

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So I thought this was interesting.

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And I'd like to maybe overlay this at

some time, if we could ever get a chart

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of all the different feds and their ISM

to see if they're actually following

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Jeff Kikel: along together or 100%.

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Is it something unique to that region

around Chicago that's having issues?

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But honestly, I don't think so.

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And most of the ones we follow have

the negative, so I would say they're

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probably along the same lines.

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It's interesting to watch how it

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And then 2024, it's just

Freaking going straight down.

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Ron Lang: For the most part, and look,

this has been for in history 50, 5 0.

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0 has always been like the demarcation

line of expansion or contraction.

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And the interesting thing is,

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Has been contracting.

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The PMI had a spike in

late 23, but holy crap.

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This is, if you just take a look

at, at the historical numbers

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in the last 25 years, this is.

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Parabolic move to the upside.

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This is just falling down an

elevator shaft to the downside.

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Sure Yeah,

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Jeff Kikel: Like I said the weird

divergence though between pmi And

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ism where ism's been creeping its way

back up, you know I mean in the end

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it's the pmi that's going to drive

stuff because they're the people that

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buy things From the manufacturer.

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Ron Lang: And my last one was the

the job openings and labor turnover

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summary, this kind of came right

from their press release on June 4th.

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And I'm not going to read all this,

you and I have talked about this just

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tad dozy and probably got revisions.

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So I highlighted the mar this is the

april and why it's a month behind.

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I don't know because it came out

in june for april don't understand

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that but the march revisions were

revised down to 133 thousand I just

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find that this is just crazy Because

down here what's also not calculated.

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I didn't highlight it is the

number of quote unquote quits

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Jeff Kikel: Yeah,

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Ron Lang: so there's a difference and I

don't know how they're able to decipher

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and differentiate The people that

are let go the people that are hired

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Versus the people that just i'm done.

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I'm quitting.

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Jeff Kikel: Yeah,

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Ron Lang: I don't know and here's

the other one the total separations

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This is my other point the total

separations were revised by 130 000.

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So what the hell is

the difference between?

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quits Separations fire.

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I don't know.

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All I know is it keeps

getting revised the wrong way.

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Whether it's the quits and the revisions

are quits and the separations to

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the upside and then the other stuff

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Jeff Kikel: goes down.

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And yeah, and I, in our next show, I've

actually got a chart on this that I'll

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go over to look at the consistency of it.

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And the jolts number hit

a high point up around 11.

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11, 000, 000 12, 000, 000 right

after the pandemic, and it's been on

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a continual downward spike, which,

meant, okay, part of that was people

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getting back into the workforce.

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And, of course, reducing

those open positions, but.

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I think what's happening now from

my perspective on the jolts number

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is, those jobs are starting to get

pulled back, companies are looking at.

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Okay.

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We don't want to fire people right

now, but we're just going to pull back

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the job openings, where there's not

as many job openings at this point.

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Ron Lang: Yeah, and actually one quick

thing I wanted to bring up here and I

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didn't highlight it I meant to bring it

up was we talked about this a couple of

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times that when the employment number

and actually we'll know tomorrow the

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unemployment for may and You know the

interesting thing we always talk about

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if you look into the details of the

numbers not just the headline But the

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details that half to two thirds of the

new hires were government jobs Yeah, I

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thought this was interesting in april

Federal government jobs went down.

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8000.

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Jeff Kikel: Yeah.

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Yeah.

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It was interesting.

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It was medical, medical and governmental

jobs, which I mean, I would argue

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the point that a lot of those I would

still categorize a lot of those medical

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jobs as, Government jobs in some way,

shape, or form, at that point, but

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yeah, those, it was really dramatic.

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And I think we, we covered that in a

couple episodes ago when that number

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came out of, this was just like a

really weird aberration where, we had

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seen this huge growth in government

and all of a sudden there was a

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massive pullback in government hiring.

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Ron Lang: The whole point is they

keep hiring, but here they let go.

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So are these people that retired are

these people that decided to go into the

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private sector again We don't know the

reasons behind all this and unfortunately

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You know financial media economists.

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I mean Are looking at the headline

number because that's the number

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they're plugging into their models.

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Yeah Again, I don't know what they're

doing with all these other details

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as far as How the sausage is made.

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But

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Jeff Kikel: and if we look at, although

it's sometimes not the best indicator of

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it, if you look at ADP unemployment this

week, it was a pretty big of a shock.

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I know I'm just looking at briefing.

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com.

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The forecast was 165, 000 jobs and

it came in at one 52 on the ADP.

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So it's interesting, but I just, what

I've seen from the federal numbers is

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it's they're budgie at the, when they

come out as a headline and then they

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revise them back, you, you've got to

really pay attention to what they're

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doing, back three, four months, because

they're constantly revising them.

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And those things have been going down

pretty dramatically on the revision.

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Don't know.

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I just, if you look at the jolts number,

you look at that and we'll, like I

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said, in the next episode, we'll cover

this a little bit more in detail.

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I just see that slowing and that's

just, that's the last kind of do

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that I see to fall potentially.

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So make sure you stay

tuned for the next episode.

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Where we actually get into

this a little bit more.

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Ron Lang: Never a dull moment and

there's always something to chat about.

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So absolutely.

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The good thing is

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Jeff Kikel: there's always news and

plenty of stuff for us to talk about.

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Folks, thank you for joining us.

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Once again, we do these shows for you.

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Make sure that you take the

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Let us know that you're around.

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So thanks a lot and we'll see

you back here the very next time.