Lipstick Recession and Wind Turbine Woes: Unpacking Economic Trends | Cents of Things

In today's episode, the Cents of Things team dives into the latest economic indicators and market analysis with Ron. The discussion starts with a lighthearted critique of the upcoming political season and presidential debates, followed by intriguing historical facts about 'The Wizard of Oz' and Burger King's Whopper wine. They then explore the high levels of the current market, factors affecting it, and potential risks. Solar energy and its industry challenges are also reviewed, capped with a look into unconventional economic indicators like the lipstick recession indicator. Tune in for an engaging mix of finance, fun facts, and candid commentary.

00:00 Introduction and Greetings

00:33 Political Season and Presidential Debates

02:08 Fun Facts and Trivia

05:16 Market Analysis and Predictions

08:23 Economic Indicators and Credit Conditions

11:29 Investment Ideas: Solar and Wind Energy

17:12 Conclusion and Farewell

You can also catch the show on our YouTube Channel

https://www.youtube.com/@TheCentsOfThings

To Follow Jeff Kikel

www.LinkedIn.com/in/JeffKikel

www.FreedomDayWealth.com

To Follow Ron Lang

www.linkedin.com/in/RonLangBuildsWealth

www.AtlasBuildsWealth.com

Welcome to the Cents of things

podcast, where your money talks and

2

we listen, join host Jeff Kikel and

Ron Lang as they explore the economy,

3

financial planning, and the stock

market, adding a splash of fun to

4

make your financial journey engaging.

5

Each episode, they break down

complex topics to give you the clear

6

edge in your financial decisions.

7

Stay tuned and let's make

Cents of things together.

8

Jeff Kikel: /Good morning.

9

Welcome to the Cents of

things with Jeff and Ron.

10

We are here to walk through

some good stuff today.

11

We're going to have some fun things

to talk about, and we're going to go

12

through the top 10 economic indicators

that you as investors should follow.

13

Good morning, Mr.

14

Ron.

15

Good morning,

16

Ron Lang: Mr.

17

Jeff.

18

You know what?

19

It's funny.

20

You ask six economists what's going

to happen six months from now.

21

You get six different answers and

you ask them what their models are.

22

There's hundreds of these economic

indicators, but it's amazing how

23

financial media kind of hones in on four.

24

Jeff Kikel: Exactly.

25

So we're going to hone in on 10.

26

Honestly, these are ones that we

almost always follow on our show.

27

We report on as they come out.

28

So I think, this is the

stuff I consider important.

29

It's the things I look at and if

you look at Places like briefing.

30

com These are the ones that have

the highest impact on the market

31

they're not ones that people look

at and go when it comes to that.

32

Okay let's let's kick this puppy off.

33

Let me share my screen with

everybody and We're gonna start

34

off with some did you knows?

35

That I had actually put

together about a week or so ago.

36

And we just weren't able

to spend time on them.

37

Can you see that on your screen there?

38

I can.

39

All right.

40

I had a guinea pig when I was younger.

41

Did you know that Switzerland prohibits

the ownership of just one guinea pig?

42

So there are no lonely guinea pigs.

43

I'm wondering if it's a religious thing.

44

I don't know, or it's just, hey,

it's the guinea pig lobby, the pet

45

shop lobby of trying to force you to,

have 100 percent more guinea pigs.

46

Ron Lang: Okie dokie.

47

Jeff Kikel: Human teeth are the only

part of the body that cannot heal itself.

48

I did know that.

49

Dentists will always have a job no matter

what and AI will not take their job away

50

Ron Lang: no, and that's why implants

are so popular because once you

51

lose your enamel you're done and

52

Jeff Kikel: You get it

back with the implants.

53

We are more creative in the shower there's

a lot of ways I could take that one.

54

I know now, I am able to sing as

well as Billy Joel in the shower.

55

Which is good now from a writing

standpoint, I will say I'm a

56

little less creative when I drag

my laptop into the shower with me.

57

Ron Lang: I gotcha.

58

I will tell you I'm tone deaf.

59

You don't want to hear

me sing in the shower.

60

Jeff Kikel: As long

61

Ron Lang: as

62

Jeff Kikel: you're by yourself,

63

Ron Lang: excuse me, you

don't want to hear me sing

64

Jeff Kikel: at all, let alone

65

Ron Lang: a

66

Jeff Kikel: shower.

67

Okay, now this is funny.

68

I got this from a website called we

are teachers and I'm like you aren't

69

very good spellers, but fruit loops

are actually all the same flavor.

70

Despite.

71

The the color of that,

72

Ron Lang: you know what?

73

I thought I knew that I used to

like Fruit Loops when I was younger.

74

I was always a Frosted Flakes guy,

but we sprinkled in some Fruit Loops

75

and sugar smacks every now and then

76

Jeff Kikel: I

77

Ron Lang: hated Captain Crunch.

78

I didn't do Raisin Bran.

79

I didn't do any of those.

80

What were your favorites?

81

Jeff Kikel: I was a Captain Crunch

guy when I was really young.

82

And then I shifted to shifted

to Raisin Bran of all things.

83

But the only problem with brazen

brand is you just got to shovel it

84

down really fast because otherwise

it gets all mushy and disgusting.

85

Hey, I'm

86

Ron Lang: not afraid to say I got a box

of frosted flakes in my pantry right now.

87

Hey, you know what?

88

You never go away.

89

Come on.

90

I am a Leo, so I am king of the jungle,

Tony, the tiger isn't so bad either.

91

Jeff Kikel: Competitive arts.

92

We're coming up to the Olympics.

93

Competitive art was once an Olympic sport.

94

So I put that in

95

Ron Lang: with how competitive art is.

96

Yeah.

97

Rhythmic gymnastics.

98

All right.

99

First person to draw me a

stick figure and Jeff wins.

100

Yeah.

101

So was it a timing thing

or how to be judgmental?

102

I

103

Jeff Kikel: really don't know.

104

I'm going to have to look that one up.

105

Yeah.

106

It's interesting to me.

107

And I don't know when

it left the Olympics.

108

I'm assuming this was one of the

early on things or whatever, but.

109

All right.

110

Let's get to the top 10 economic

indicators that investors should call

111

Ron Lang: this is number

112

Jeff Kikel: 10

113

Ron Lang: and

114

Jeff Kikel: these aren't any specific

order except for the last one, I put

115

the last one because I think right now

I don't particularly rate it as the

116

top thing, but I think right now it

should be, or it is on everybody's mind.

117

Number 10 on our list, GDP.

118

So gross domestic product.

119

This provides the overall value of goods

and services that the economy produces

120

and it indicates whether we're slower or

we're slowing or growing at that point.

121

It tells us that this.

122

Is a component of leading economic

indicators as well, which is interesting

123

because it's a lagging indicator.

124

Of course it is, but it's measured

in leading economic indicators,

125

which, yeah, once again, I've never

understood it because it's always

126

looking back up to always revising.

127

Yeah.

128

Employment figures, this hasn't been

a major issue for a few years, but

129

I think it's going to become more

important as we get farther and

130

farther into what we're seeing, the

cracks that are showing up there.

131

This is monthly, it comes out, usually

it's about the, what, second week ish.

132

That we get this now.

133

First Friday of every month.

134

Okay.

135

First Friday of every month.

136

Ron Lang: And it depends because if the

first Friday is the first or second,

137

then sometimes it goes the next Friday.

138

I forgot what the provision was for that.

139

Jeff Kikel: It's definitely the most

important thing because that's what's

140

really holding up the economy right now.

141

If you look at a lot of the economic

numbers, they're actually somewhat

142

poor or declining and the employment

figures have been strong although

143

weakening a little bit, we're back

up to above 4 percent at this point.

144

So it's starting to that

starting to become a factor.

145

Industrial production.

146

So this is how much production

as a measure of output of

147

manufacturing industries.

148

So this including this includes producing

goods for consumers and for businesses

149

is the monthly release from the Fed.

150

And, it reports on capacity

utilization in the factory sector.

151

So extremely important because this

can also be an indicator of what

152

the job situation is going to be.

153

I think that's the PMI too.

154

Yeah, absolutely.

155

So it's an important figure.

156

And a lot of times it leads

in there a little bit.

157

All right.

158

Next one in line, consumer spending.

159

So this accounts for two thirds of the U.

160

S.

161

Gross domestic product, and it's a good

gauge of whether the consumer is spending.

162

It's monthly, and it

lays out personal income.

163

It provides data on consumer spending.

164

It also provides inflation through

the consumer through a price index.

165

Once again, another thing that it's

one of those things where you start to

166

see All right, if there's unhealthiness

in The, industrial sector people are

167

getting uncomfortable with either

the economy or their job situation.

168

You can see that pullback

in consumer spending.

169

All right, next one in line, home sales.

170

Now, why is this a big thing?

171

It's a big thing because the home sector

drives a lot of the other sectors.

172

The home sector can drive,

there's more home sales.

173

That means the home depots in the

lows of the world can increase.

174

It means that, durable goods like

refrigerators and all the other

175

appliances in your kitchen are all

going to potentially go up because

176

people are shifting to new homes.

177

They may be updating either in an

existing home or in a new home.

178

Of course, that's.

179

more of a wholesale product.

180

What's your thoughts there?

181

Ron Lang: Look in my lifetime, home

sales and home pricing has only

182

drastic, the drastically affected

the economy in the markets twice.

183

Once in the late eighties, early

nineties, and obviously 15 years ago.

184

Right now, they're, I think that

this is just a bunch of propaganda

185

from the real estate people saying,

oh yeah, interest rates are cut.

186

They don't know if interest rates

are coming down because obviously the

187

high mortgage rate is, is impeding,

people from From buying a house.

188

I know in my neighborhood, there's

still five or six houses up for sale.

189

House across the street has been

on and off the market for a year.

190

Yeah, people will look at this

as a way of our people spending.

191

And look, new home sales.

192

We, we talked about this before

has been, unbelievable, right?

193

Because there's not enough inventory of

used houses or existing homes, right?

194

Not used, but existing homes.

195

So people are buying new.

196

Yeah, I think it's an important factor.

197

But, in our lifetime, only twice

has a drastically affected.

198

Yeah, we're

199

Jeff Kikel: drastically went down.

200

I think it's likely that prices

will pull back at some point.

201

But for right now, With

rates where they're at.

202

Somebody that's like me, that's

sitting on a 3 percent mortgage or 2.

203

75 percent mortgage,

I'm not going anywhere.

204

Why would I, at this point,

I'm happy with my house.

205

And then until I decide to move to

a different state, I'm most likely

206

not going to sell my house, even

though it's bigger than I need.

207

Yeah, I'm just not going to sell it.

208

I was just

209

Ron Lang: about to say unless

you were going to downsize

210

Jeff Kikel: and then you wouldn't have

a mortgage probably because you're

211

going to buy a lesser valued home.

212

And that's likely what's going to happen

for us anyhow, because we, I don't need

213

a big house and it's just two of us.

214

We're, we've got probably

215

much for us right now as it is.

216

That's really what we're

looking at in the future.

217

But until things pull back,

I'm not going anywhere.

218

I thought

219

Ron Lang: you use that 1, 500 square

feet of space for your podcast studio.

220

Jeff Kikel: I do use it for a podcast

studio and now I've moved another

221

room in the house into a video studio.

222

So I

223

Ron Lang: mean,

224

Jeff Kikel: I've got the space and

I'm not using it for other purposes.

225

So my office became a video studio.

226

And why not?

227

All right, home building.

228

So this is related.

229

This is more on the new side and

it's an indicator of, okay, how,

230

especially with the builders, how

much risk are they willing to take by

231

throwing more houses out on the market?

232

I think at this point they can pretty much

put as much as they want out on the market

233

and they're going to pretty well sell it.

234

There was a little bit of a slowdown.

235

I know from talking to my realtor

buddies, there was a little bit of a

236

slowdown early on in that That first

part of the interest rate raise.

237

And then now homebuilders are

back to building they're just not

238

building at the pace that they

were before and it's summertime.

239

Yeah.

240

But really for this year, they've

really not been building at that pace.

241

Construction spending.

242

Also in these are all

interrelated, but how much is

243

construction spending going on?

244

And this is all the different

stuff related to it, such as labor,

245

materials, engineering work, all

of that falls in here and it's

246

residential and non residential

public and private construction.

247

So it's a view of all of this together.

248

All

249

right.

250

Manufacturing demand.

251

So related to the industrial production,

manufacturing demand, this is the

252

report on how much the manufacturers are

shipping their inventories and orders

253

as a demand for manufactured items.

254

So this is a monthly report, but.

255

There's a more lengthy follow up

usually the following month that

256

kind of gives it an update and there

may be some adjustment in there.

257

Ron Lang: Yeah.

258

All these things are interrelated.

259

It's just a matter of, the inner,

it's, you see the headline number.

260

I lost your sound.

261

These things have given you different

ways on how the sausage is made, but it's

262

all tell it's all telling you a story.

263

Jeff Kikel: Yeah, it is.

264

And I think the most important

thing that I would tell from this.

265

Is there is just no one or two

of these, or, as the news media

266

gets where it's one or two, and

then they focus on those nonstop.

267

It's you get a picture of the tapestry.

268

When you look at all of these together, I

269

Ron Lang: mean, earlier

you had consumer spending.

270

Retail sales is a separate number, but

that's part of our consumer spending.

271

Jeff Kikel: Yeah.

272

And it, but it's all related to

that retail and food service.

273

So it's a little bit more of a.

274

Deep dive into specifically

the retail environment.

275

If I remember correctly, I don't I can't

remember if or not that this includes

276

like online sales and stuff like that.

277

I think it's all I believe it does.

278

Yeah,

279

Ron Lang: they changed that

about 10 or 15 years ago where

280

they included retail sales.

281

Obviously it's as long as those companies

are reporting, which I'm sure is a little

282

bit tougher, Amazon and Walmart, I'm

sure it's pretty easy for them to report.

283

Jeff Kikel: Yeah, exactly.

284

Cause it's just, total sales for that.

285

They're the

286

Ron Lang: two

287

Jeff Kikel: biggest out there.

288

Yep.

289

All right.

290

The last one is inflation.

291

And I think this is the one that

both the media is focused on.

292

I think it's a, an election issue

right now, or, tonight you've

293

got the presidential debates.

294

I'm sure this is going to be one of the

top two or three topics that are in there.

295

And inflation comes in via the consumer

price index, the producer price index.

296

And the one that, you know, really,

I never paid attention to much, but

297

the Fed has really narrowed in on that

they use as a major factor is the PCI.

298

So the personal consumption expenditures

which I think is funny because I think

299

PCE, they pretty much, they, once

again, just CPI, they remove food and

300

energy because they say it's so volatile

that they can't track, can't track it.

301

I'm like I think that's probably two

of my largest expenditures that I have

302

is food and energy, but just say it.

303

Ron Lang: Yeah.

304

And you know what?

305

I never understood this and this

is a separate conversation, but.

306

Going back to, when we were kids and

inflation was skyrocketing and it's

307

fluctuated up and down, they said no.

308

You, you need at least two or 3

percent inflation every single year.

309

Like why can't prices just stay the same?

310

That's because public companies, they

got to do better than last quarter.

311

They've got to, increase prices.

312

People want raises, you got to

do improvements and upgrades to

313

facilities and manufacturing.

314

So price has got to go

up every single year.

315

I always talked about, you ever see

Oreo cookies, they've gotten smaller.

316

Yeah.

317

Bazooka bubble gum used to be

this nice big piece, then smaller,

318

then they put ridges in it.

319

So it was the same size,

but it was less bubble gum.

320

Of course, I only hone in on the

important things but the idea is

321

that, why can't prices go down?

322

Oh, stagflation is bad.

323

Deflation is bad.

324

Why?

325

If people aren't going to get raises every

single year, or every other year, then

326

why do prices need to continue through

education or, being more educated or

327

whatever, why can't prices stay the same?

328

Jeff Kikel: Yeah.

329

Or why can't they go down at times with

it being, with it not being a bad thing?

330

Overall,

331

Ron Lang: Do you see the price of a car?

332

Forget, oh, I know you used cars.

333

New cars are insane.

334

I don't understand.

335

Look, you gotta replace your car

every now and there's, at some

336

point you replace all the parts.

337

You bought another car.

338

Yeah.

339

But who combustible?

340

What's the average cost of a car?

341

50 to 60 K.

342

Jeff Kikel: And the, the other

part of it is, okay, so it's 50 or

343

60 K the first year you buy that

thing, it's going to drop off about

344

20 to 25 percent of the value.

345

Ron Lang: Easy.

346

Jeff Kikel: Yeah.

347

I haven't bought a new car

and I don't even remember the

348

last new, I'd probably 2007.

349

Yeah, the last new car I bought,

because I buy them typically

350

three or four years old.

351

They last forever and, they're built

to last and took the premium out.

352

All that premium has gone at that point.

353

And I just have the car

and I'm fine with it.

354

I, I just don't understand it.

355

And, I think the interesting part is

the move towards electric vehicles.

356

I'm like, Yeah, but they're like

insanely expensive on top of that.

357

Ron Lang: Yeah, but I think you got

to look at the cost of the savings

358

in gas and you don't need to worry

about the, the fluctuation in gas.

359

I've had several people that love

their EVs and they swear by them.

360

And many of them have said the cars

already pay for itself within five years.

361

Jeff Kikel: I'm

362

Ron Lang: sure.

363

I

364

Jeff Kikel: mean,

honestly, I'm sure it has.

365

The maintenance is nothing.

366

On them.

367

You don't have to do much

in the way of maintenance.

368

They don't really wear out ever

besides the batteries, eventually I

369

Ron Lang: mean, normal maintenance.

370

Jeff Kikel: Yeah.

371

Yeah.

372

Just barely normal maintenance, but you're

not having to change oil and all that.

373

So I think from that perspective, yes,

but I just did a 10 hour or 10 and a half

374

hour trip back and forth to New Mexico.

375

I could not have done that

in a electric vehicle.

376

No, you still stop for gas though.

377

I stopped for gas for five minutes.

378

And the problem was there were

points in time where it was

379

like, okay, we've got a plan.

380

This is rural Texas and rural

New Mexico that we were going

381

to, we were barely finding gas

stations and I did not find or see.

382

One single electric vehicle charger in

that entire 10 and a half hour trip.

383

Ron Lang: You know what?

384

They're there.

385

You didn't know where they were.

386

You'd be surprised where they are on the

map, but an EV can go up to 300 miles.

387

And actually they're working

on ones that are now 400.

388

So if you're going to stop for gas every

300 something miles in EV, you stop,

389

every 275 to 300, but you know what?

390

They got the fast charging stations.

391

Now it's not going to take five minutes,

but it'll be less than 10 or 15.

392

Jeff Kikel: No, they won't not

393

Ron Lang: faster.

394

The fast charging ones

now are pretty quick now.

395

Yeah.

396

Oh, you're not sitting

there for two hours.

397

No.

398

Jeff Kikel: That's not happening.

399

I'm not sitting there for 10 minutes.

400

I stop in, get gas and I'm going, buddy.

401

I'm stopping to go to the restroom.

402

I'm filling the truck up,

403

Ron Lang: but it could save

you three or 4, 000 a year.

404

Would you wait an extra five, 10 minutes?

405

Absolutely not.

406

Absolutely not.

407

All right.

408

Those are good 10.

409

Let's go back.

410

Those are good 10 economic indicators.

411

You hit all the core ones.

412

There are others.

413

We've covered some of the other

ones, but those are the 10 core ones.

414

It's the ones

415

Jeff Kikel: that you should watch.

416

It's the ones that you should keep

your eyes on and it helps you to weave

417

that tapestry of what you're looking

at from where the economy is going.

418

Luckily, if you don't want to do

that, just continue to watch the

419

show, because we share these with you

as they come out almost every week.

420

There's some, one of these economic

indicators will be on that list.

421

Hold on real

422

Ron Lang: quick.

423

And as a segue and a tease,

I have the ultimate economic

424

indicator in the next podcast.

425

What?

426

Okay.

427

Then you've got to watch the next one.

428

I wasn't going to share it

now, but it's a good one.

429

Jeff Kikel: All right.

430

I

431

Ron Lang: love it.

432

It's not the underwear.

433

It's not the underwear index.

434

Jeff Kikel: Yeah.

435

Oh man, come on.

436

You haven't done that.

437

We already covered that one

438

Ron Lang: before.

439

Jeff Kikel: All right, folks.

440

That's why we do these shows for you.

441

Make sure that you

subscribe to the channel.

442

Make sure you give us an upvote.

443

Let us know that we're

doing a good job here.

444

We really appreciate it.

445

We've had a huge influx of

folks watching the show now.

446

So we're really excited

to have you new folks on.

447

And we'll continue to do

shows like this to help you

448

understand what you need to know.

449

So we'll see you back

here the very next time.