On today’s episode of Wealth!, Host Brad Smith breaks down key finance stories, from the AI race to alcohol sales ahead of 4th of July celebrations.
The AI craze has dominated markets in the first half of 2024, and Envestnet co-chief investment officer Dana D’Auria joins the show to give insight into its momentum. D’Auria argues that the broadening out in artificial intelligence will materialize among companies that “support AI” needs:
“Semiconductors, for example; equipment manufacturing that’s necessary for AI; energy, of course, has been a huge theme this year around AI and the expectation that we’re going to need massive amounts of energy to power this. So if you think about some of the international spaces where some of the stuff is made, and there may be not priced so stratospherically as what you’re seeing in cases here in the US, that’s one way to play it.”
As interest rates remain high and Wall Street waits on the Federal Reserve to cut rates, Curinos head of wealth Korrynn Baltzersen explains how investors should navigate certificates of deposit (CDs) amid the current economic backdrop. She notes that historically when the Federal Reserve has started cutting interest rates, “that’s when the market outperformance led more investors into the market versus keeping that money in cash.” She believes there will be a “real shift” once investors can no longer get a 5% handle, as “they can just get a higher yield in the market.”
Mortgage rates are beginning to ease slightly as the 30-year fixed mortgage rate hovers around 6.86%. Yahoo Finance Reporter Dani Romero breaks down why mortgage rates may be easing, but monthly mortgage payments may be rising for thousands of homeowners. Meanwhile, rental prices fluctuate across the United States. Zumper spokesperson Crystal Chen highlights that the most affordable rental markets include Wichita, Akron, and Shreveport. In contrast, the highest rents are found in major metropolitan areas such as New York City, Newark, New Jersey, and San Francisco, California. Chen notes a geographical divide in rent trends: the Sun Belt region is experiencing a decline in rental prices, while the Northeast and Midwest markets are seeing increases.
Story continues
Americans are just a few days out from Fourth of July festivities, and according to data from Capital One, over a third of Americans plan on buying alcohol for July 4th. Heineken (HKHHY, HEINY) USA CEO Maggie Timoney joins Wealth! to give insights into holiday alcohol sales, the growth of non-alcoholic product categories, and shifts in certain consumer demographics driving that change. Timoney elaborates on the sale of non-alcoholic beverages: “The category is up double digits and at the forefront of igniting this nascent category. When we launched in 2018, we are here to stay, and we’re looking forward to seeing more Americans choose a Heineken 0.0 over the July 4th holiday weekend, over the summer, and for the rest of the year.”
This post was written by Melanie Riehl
Video transcript
Welcome to wealth everyone.
I’m Brad Smith and this is Yahoo Finance’s guide to building your financial footprint.
Our community of experts will give you the resources, the tools, the tips and the tricks that you need to grow your money.
Hey, on today’s show, we’re entering the second half of 2024 and the first day of the third quarter, we have an investment playbook for you straight ahead.
We’ll talk about the themes that will matter to you for the remainder of the year and good news for student loan borrowers.
A key part of President Biden’s payment plan will resume after a judge granted the administration’s request to stay in order that blocked the provision of his plan just last week plus the cost of your home.
We’ll talk about the cities with the largest and smallest rent increases in the month of June and an expert is gonna give you tips on how to get the most affordable apartment, all that much more coming up during today’s show.
But first, let’s take a look to the markets here.
Stocks right now are mixed to start a new month quarter and second half of the year the S and P 500 entering Q three up 14.5% so far this year, while the tech heavy NASDAQ composite rallied more than 18% thus far, coming into the start of the second half markets in the first half largely led higher by the A I trade.
More than two thirds of the S and P 500 gains for the year have come from names like NVIDIA alphabet, Apple and Microsoft.
Investors want to know whether or not the A I trade of course, is still hot on the back half of 2024 here and for an investor’s guide to the second half of the year, we’re joined by Dana D or who is the invest net, Co chief Investment Officer.
Great to have you here in studio with us.
Thank you so much.
So first, let’s start there with the A I trade that has absolutely fueled so much new vigor into a, a theme that investors who were perhaps a little bit more passive are now becoming a little bit more active about here.
How much more legs do we think the A I trade has at this juncture?
Oh I, I think the A I trade has plenty to go, right.
We’re, we’re sort of at the beginning of this if A I takes off in any way in, in any of the ways that we expect in terms of increasing productivity, um you know, enabling companies to change the way they do business.
We’re gonna have a huge, huge demand for A I.
So we’re just at the start of this, I think what’s going on, of course is that there’s a lot of focus around NVIDIA.
And so where goes NVIDIA folks think goes the A I trade, which is not necessarily the case, right?
This thing has to broaden out much more.
Where would that broadening kind of start to take effect from your purview?
Yeah.
So I mean to start with, I think you’re still looking at companies that support that support A I in terms of uh needs semiconductors, for example, right?
Equipment, manufacturing, that’s necessary for A I energy, of course, has been a huge theme this year around A I and the expectation that we’re going to need massive amounts of energy to power this.
So if you think about some of the international spaces where some of the stuff is made and they’re maybe not priced so stratospherically as what you’re seeing, you know, in, in in cases uh here in the US, that’s one way to play it.
I would say to be very careful though about um A I washing right?
And this notion that, you know, I I’m an A I server and an A I this or A I that right?
I mean it, you know, putting the words A I in your earning script is a good thing.
So everyone’s doing it.
Yeah, of facts.
That’s been tracking the number of mentions and seems quarter after quarter that they’re saying, hey, once again, this is a new record quarter for the amount of mentions of A I on earnings calls.
You know, all these things considered here.
One of the other major themes or, or catalysts if you will, that investors were tracking coming into the start of this year and they’re gonna continue to track going into the back half is the policy pathway for rate cuts.
What is your best estimation of when that will start to, or if it’s impacting people’s playbook?
Yeah, it’s definitely impacting the playbook, I think for sure.
So much in the, in terms of our economy is interest rate sensitive and starts with, you know, what, what’s going on with interest rates.
Um, I think small caps have had a lot of pain, for example, they, they’re known to be more interest rate sensitive.
Um, and, and that’s hurt them the higher for longer.
Uh, so I do think, you know, that monitoring of exactly how many cuts I think.
Look, uh, everybody kind of thinks we’re gonna get some start on the rate cuts this year.
Uh, it would be an odd play to get moving too early on rate cuts considering where our economy is.
I mean, GDP is, you know, so it, it’s good, it’s not the blow out.
It had been for a while there, but it’s good.
Unemployment’s fantastic still.
Right.
I mean, there’s really not cracks there.
So with the market doing very well.
GDP kind of remaining pretty good.
And unemployment, uh, low, you know, employment strong.
It’s really hard to make a case that we need rate cuts right away, that being said.
And in a re election year, the fed usually cuts rates.
So we should expect some.
So is it one, is it two, you know, betting os probably one before the election, one after the election.
But there’s a lot of data come in between now and then.
Is there a good election rule of thumb that investors need to remember as they’re trying to really navigate what could be some potential volatility as UBS had put it in some of their election watch coming into that general election.
Yeah, look, I mean, the empirical evidence looking historically at what happens in election years, it’s there hasn’t been a lot by way of correlation between the party in power and whether markets in general do well, although much attempt to, you know, create something like that, right?
And find that kind of a link.
Um But that being said, of course, this election in particular, there are clear winners and losers that the market.
In fact, you have whole country economies, markets kind of moving on the basis of this election.
So you know, China versus India, right?
Um Trump wins not good for China, maybe not good for Mexico, uh good for India and Vice versa.
So, so the idea of this near shoring and, and, you know, Trump kind of coming in and with, with much more massive tariffs.
So I think when you’re looking within countries and within sectors, yes, there are clear winners, financials got a big bump after the debate.
I think we, we can all, you know, kind of point to why that was the case.
So, you know, as, as you’re looking at the second half and you’re, you’re judging where you’re gonna be in terms of the market.
The other thing I would just remember is look, the market prices, this information pretty quickly into the prices.
And I think a lot of times people forget that, you know, so the price has to reflect both the potential outcomes and the probability all in one number.
So it’s gonna move at least to a certain extent to, to what the expectation is.
And you know, then when the actual, you know, the event happens, um the rest of that movement tends to happen.
So getting ahead of that is a very difficult thing to do, Dana.
Great to have you here in studio with us.
Thanks so much for kicking off the second half of 2024 with us.
Appreciate it, Dana Doria, who is the Investment Co Chief Investment Officer?
Great to see you.
Thank you.
The Biden administration’s new student loan repayment plan, getting the green lights to resume over the weekend.
A Federal Appeals courts granting the saving on a valuable education or the safe plan uh stay is what it was given after a provision of the plan was blocked after a judge issued injunction last week.
Now, this gives the administration to go ahead to lower borrowers monthly payments.
This impacts around 8 million borrowers who have signed up for the new income driven repayment plan.
So far.
Now, the plan eliminates 100% of remaining interest on subsidized and unsubsidized loans after making a full scheduled payment.
Now increases the income exception which cuts monthly payments.
So this also excludes the spouse’s income if filing taxes separately.
So what does all this mean?
Well, it’s a major win for President Biden.
The administration has forgiven about $167 billion in student loan debt during the presidency according to the White House.
Well, before we all head out for July 4th, later this week, we will be getting some brand new jobs numbers that could actually give us a better picture on the state of the economy.
For more.
We bring in our own, Josh Liton who’s been tracking all things employment situation.
Hey, Josh Brad.
Good to see you.
So you’re right.
It’s a holiday shortened trading week here, but we still do have some important economic data to consider.
Remember last week we got the University of Michigan’s Consumer Sentiment Index.
The final reading was 8.2 in June strategist, Peter Boar notes that was down for May in the lowest since November but better than the initial June print.
So Bucar says positive though still weak turning to this week.
Now we’re gonna get a window into the labor market with AD P on Wednesday.
Us private employers are expected to have hired 100 and 58,000 workers last month.
Of course, that report is published ahead of the labor department’s more closely monitored report coming out on Friday morning, the all important monthly non farm payrolls data for June.
Now economists expect the report to show that 100 and 90,000 non farm payroll jobs were added last month per Bloomberg with unemployment holding steady at 4%.
Remember that in May, the US economy added 272,000 jobs added up and economists see a labor market that is cooled but isn’t cold in their words.
So the question now what comes next as Nick Tiros of the Wall Street Journal puts it is the labor market in a sustainable equilibrium where unemployment settles at around 4% or he asks keep softening resulting in recession as historically has occurred when unemployment rises much more than it already has.
Economists of course, have different takes.
A more optimistic view comes from Edgar Denny who tells clients that he is not concerned about our labor market, emphasizing that private payroll employment is driven by corporate profits.
And as he points out in this chart, the S and P 500 forward earnings continues to rise to record highs.
Bottom line.
Doctor Ed says profitable companies tend to expand their payrolls but a cooling labor market coupled with signs that inflation is moving in the right direction have implications for the Federal Reserve.
Of course, markets currently assigning a nearly 62% probability of a rate cut in September with a cooler jobs report on Friday morning.
Give our central bankers greater confidence to make that move.
Investors are going to be watching Brad back to you.
All right, thanks so much.
Excellent breakdown.
Some key data that we’re gonna be tracking even during this holiday, abbreviated trading week.
Josh, thanks so much.
You got it.
Well, how much do you have?
Save for retirement depending on your age, you may be a bit more stressed about that balance.
We break down all the tips and tricks to make sure that you have enough to live out your golden years.
That’s right after the break.
Stick with us.
55 year olds have a median retirement savings of less than $50,000 according to a prudential report for a demographic, just a decade away from retirement.
That’s pretty far from the target of having eight times your annual income saved to break down how to catch up and how younger generations can start off strong.
We’ve got Yahoo Finance’s own carry Hannon here to discuss Carrie.
What do we know about how people can close that gap between what’s necessary and where things currently sit.
Absolutely brad, great to be here.
Um, yeah, this study is a little alarming because that short runway to retirement for someone who’s 55.
Um, and, and it’s worth noting because this generation also in report showed that, um, they’re, you know, woefully, uh short when it comes to emergency funds, they just seem to be grappling with a lot of financial issues.
Inflation certainly plays a role in that.
But what’s concerning is that, that sort of, and if you recall, Jenny is the 55 year old is square in that age range, you know, from around 44 to 59 this year.
But here’s the good news, Brad, it appears that younger generations are actually getting started investing earlier and this bodes very well for their retirement.
Uh Another uh report I saw from Schwab actually showed that whereas Gen X didn’t get started saving for retirement.
So that 55 year old until age 31 the Gen Z.
So our youngest generation, those who are in their early twenties, up to say age 27 they started at age 18, millennials around age 24.
So we’re seeing some momentum there of getting going a bit earlier with the younger generation.
The message is getting through.
Um And the other thing I noticed in some of the new reports is that in the percentage of people who are actively investing, I was really curious, it was really curious for me to see that Gen Z again, those younger uh folks just getting rolling in the in the job market are investing at, at a rate of around 45%.
And that is really encouraging.
So that was one thing.
The other side of the, the equation is Fidelity’s first quarter report came out and they actually uh pointed to some numbers that were, you know, a bit optimistic and good for that.
Gen X, that 55 year old, they said that Gen X has a total savings rate, the ones that they monitor in their retirement plans of over 15%.
And that’s above what they recommend as a good rate of savings.
That’s a combination of personal savings as, or, you know, into your retirement account and your employer contribution.
But the good news here again, Gen Z, hey, they’re going for it.
They’ve got 11% total savings rate right now.
And I’d say that was pretty good.
I don’t think I did when I was that age.
Yeah.
No, me neither.
Carrie.
So, so what action can people take right now to better position themselves?
Yeah, bro.
That’s really important to focus.
Focus, focus.
Let’s go back to that 55 year old that, that has under 55,000.
Save for retirement.
You have absolutely got to make saving a priority.
You do have some runway, but the fact is, you know, someone who thinks they’re gonna retire at 65 people, really often retire at 62 for a whole gob of reasons.
You could be physical reasons or what have you layoffs.
But so they may only have seven years, not 10 years.
So buckle down, you know, really rev it up.
And one expert I talked to said, hey, if you can save 25% go for it, um, of your income towards your retirement savings.
So that would be really cool.
The second thing you really absolutely need to do is if possible, you know, push back, taking your social security.
This is a, a hugely unpopular suggestion.
Most people really like to jump right into social security as soon as they can get it at age 62.
But the fact is if you can wait till age 70 I know that’s a big ask, but if someone has the ability to do that, you get the biggest paycheck moving forward for the rest of your life, there’s an eight percent increase each year from your full retirement age, which is around 67 to age 70.
So if you can possibly do that, and in order to push it back, that third tip is try to stay on the job as long as you can.
Obviously, if there’s physical issues, health issues, you can’t, but the longer you can keep working, keep your skills up to date, stay in the job market, you can push back taking that social security and really improve your retirement security in the future.
So, uh those are really things that I, I think people need to focus and, and buckle down.
All right, some top tips, Carrie Hannon.
Thank you so much, breaking this down and the results of the survey plus some actionable items that people can really capitalize on.
Thanks so much, Carrie.
Thanks so much, Brett.
Well, our interest rates right now, interest rates are high, but for how long the majority of interest rate traders are pricing in a rate cut in September.
So it might be time to re examine your portfolio to look at investment areas that are rate sensitive.
A big one C DS, this is a type of savings account that pays a fixed interest rate for an agreed period of time.
So is now a good time or uh not a bad time to get into C DS or is the answer more complicated than this?
And certainly let’s get a full breakdown on this right now.
We’ve got Kin Balter.
So who is the head of wealth at Carinos?
Great to have you here with us, Kin, first and foremost, you know, as people are trying to figure out why C DS make sense right now and also trying to kind of uh examine what the Feds policy pathway may look like.
What is the top thing that they should keep in mind with this type of instrument?
Absolutely.
Thanks for having me this morning, Brad uh in the Wealth Space C DS are definitely uh a much different option than what you see in the traditional retail space.
Uh for wealth clients who have so many different options for where to place their cash.
It really is a balancing act around.
Uh how much of a return are they looking to get?
How much money do they wanna have in a consistent uh steady rate versus in the market where there can be some volatility.
Uh What we’ve seen for the first time in recent history is that wealth clients are adopting retail C DS and what’s happening there.
Uh At the start of 2023 C DS represented just 3% of wealth deposits and clients were uh adopting C DS, about 10% of acquisition balances going in C DS.
Uh that picked up greatly last year as you could get to a 5% handle on a CD.
Uh There’s something in the mentality of an investor that 5% seems great.
And so even wealth clients started adopting C DS at a much higher pace.
Uh It’s been about 20% of acquisition dollars going into C DS since mid 23.
That’s not slowing down at all as long as we stay in this hire for longer environment and C DS now represent about 11% of wealth deposits.
So, Corinne, what happens when the fed begins its rate cutting and, and the pacing of that still remains unclear, but what happens when that pathway really kicks off?
So, Brad, what’s really been interesting?
I think we need to look at what’s happened since last July.
Um, in, uh, historically, in times between when the fed stopped raising rates and started lowering rates.
That’s when the market out performance led more investors into the market versus keeping that money in cash.
We haven’t really seen that this year.
Uh, people are holding more money in cash than ever before.
So as rates start to go down, I think there’s gonna be a real shift once clients can no longer get that 5% handle anymore.
And then there’s gonna be another sort of mental break there at 4%.
Um, if rates, uh, rest at, you know, the 3 3.5% mark that everyone’s, uh, sort of betting on it is highly unlikely that wealth clients in particular will continue to adopt C DS.
Uh, they can just get a higher yield in the market.
Uh, right now they have options with money funds and treasuries, uh, where they don’t have to lock up, uh, their money for so long, uh, to get that 5% handle.
And, and so what is a way that someone could get involved or could exercise, uh, uh, an opportunity to make sure that they’re taking advantage of the full benefits that a CD might give them, you know, where does that thought process even initiate for a lot of people.
Absolutely.
Uh, if I could predict the market and where rates are going, uh, I certainly wouldn’t be sitting in this seat.
I’ll tell you, but, uh, for clients who are interested in, in locking in, you know, we do believe we’re at top of market right now.
And so that 5% in the impending rate cuts, whether it be September later this year or the multiple rate cuts that are gonna be happening next year.
Um This could be the last opportunity to get in at that 5% lock it in.
Um And, and have that what we see with wealth clients is that they are much less likely to lock in for a longer term.
So in the retail space, clients might be betting right now and locking in for 12 months, a wealth client would rather kind of preserve that optionality and have liquidity to be able to go into the market.
And so most wealth clients are locking their money up for a maximum of nine months with the majority at kind of 6 to 7 months right now.
Uh, we saw for the first time in history that clients were timing their CD maturities in the wealth space with tax time.
So they would uh have their renewal go into a checking account and then use those funds to pay taxes.
Whereas in the past, it was money moving from the market into checking in order to pay taxes.
Corinne Balson, who is the head of wealth at Carinos.
Corinne.
Thanks so much for taking the time here with us today.
Thank you.
Coming up, everyone.
As former New York City mayoral candidate, Jimmy mcmillan once said the rent is too damn high and it just keeps getting higher in some areas we’ll discuss why next mortgage rates have come down recently, still remaining near that 7% level but easing in the last few weeks, but for many homeowners, they could soon see their monthly payments rising.
Yahoo.
Finance reporter Danny Romero is here with why, why, why are you doing this to them?
Danny Brad.
A shockwave may be coming for many homeowners.
Data from Intercontinental Exchange shows that more than 100,000 loans will reset in the next 12 months.
Now these are homeowners that have an arm loan, an adjustable rate mortgage loan which can offer temporary relief for homeowners who want to avoid paying higher mortgage rates.
But they also come with the risk.
Homeowners have a fixed period usually between five seven or 10 years.
Then the rate on an arm loan a just based on market conditions.
Now due to rates staying high, many arm loan holders are experiencing an unpleasant shock of higher monthly housing payments.
About 1.7 million homeowners have bought homes with an adjustable rate mortgage since 2019.
And that’s according to data from Intercontinental Exchange.
Now, remember an adjustable loan can make sense for home buyers, comfortable taking risks of interest rate increases or those who plan to move and refinance before that fixed rate expires.
Now, it’s also very key to pay close attention to those details of your loans.
Otherwise things can really turn ugly.
Brad.
Yeah, Danny, let’s talk about rentals here.
A new report says that the average apartment sizes are getting bigger, how much bigger and why bigger living spaces are making a comeback.
The average space size, excuse me of a new apartment has increased by 27 square feet from the previous year.
Now that’s the size of a kitchenette or a small bathroom.
Now, the reason behind a bigger a bigger new apartment space is that there’s more supply of 2 to 3 bedroom apartments that have been added to the market.
Now, cities like Jacksonville, Florida, Orlando Florida, they are the cities that are offering larger new apartment spaces.
But even here, Brad in New York City, new apartments are getting roomier by 16 square feet which could be a small walk in closet, Brad.
Wow.
Ok. All right.
Kudos to all the people with the shoe collections out there getting a walk in closet, Danny.
Thanks so much.
Well, let’s stay on the topic of rents asking rents for apartments in some of the biggest cities in the US have risen by double digit percentage points since June of 2023 here with more information on where rents are rising and where they are falling.
We’ve got Crystal Chen, who is the Zer spokesperson.
Crystal.
Great to have you here with us.
So, where are the hot spots where rents?
Let’s start with the good news where they’re falling.
So, um our most, we have a report that we publish every month.
Um and our most affordable cities right now are Wichita, Akron and Shreveport.
Um and our most expensive cities are um in New York City, uh New Jersey and in San Francisco, um we’re seeing a ton of supply coming onto the market in the Sun Belt.
So markets in um Florida, Texas, Georgia, they’re seeing, you know, double digit um rental price declines versus um the northeast and Midwest markets like New York City, Chicago are seeing rents up in the double digit annually.
You know, I I’m glad that you mentioned that because construction is obviously everywhere in New York City where we are, but I wonder in other parts of the country that are seeing perhaps stronger construction, the net effect that that is having on rents and what the kind of trend is that people renters are expecting in this near term.
So, yeah, I think nationally our um index shows that rents are up 1 to 2% year over year, which is pretty low.
But if you dive into regions, you’ll see that um like I mentioned, if you’re in living in the Sun Belt area, um you’ll see all these new construction and you’ll see rents decline a bunch annually.
Um Versus in New York City, rents are the highest of the nation.
And the current vacancy rate for New York City is 1.4% which is down from the 4.5% rate that it was only two years ago.
So even though there is a lot of construction in New York City, there is still so much demand.
Um And that demand has even spilled over into neighboring states like Connecticut and Jersey.
Since New Haven and um Newark rents are also up about 7% annually too.
Yeah, that’s been remarkable to see, especially with those who are accessing public transit just to commute in commute out of the city.
You know, while we got you, we gotta give people some, some actionable tips to really help find an affordable apartment.
What are some of the mechanisms that they can deploy to make sure that they’re getting a good deal?
Yeah.
So um the first one would be use seasonality to your advantage.
Um Winter is the best uh season to move since typically property owners um tend to price down units to fill, to fill vacancies before the holidays.
Um And there’s typically the lowest competition and demand overall.
So if you’re looking for a good deal and you can move in the winner, um that would be the best time to snag a deal.
Um Also look for move in specials.
Um As I mentioned, there’s a ton of inventory hitting uh the US market this year, I think, peaking at a 50 year high this summer.
So, um a lot of new buildings are offering concessions like 2 to 3 months of free rent, um waived deposits and fees and free parking spots.
So, um that will significantly reduce your annual uh rental costs.
Um And also just use multiple search tools.
Um Zer is obviously a great source um since we’re all across the nation and in Canada, but using community boards or if you’re in an agent market, talking to brokers um could be helpful.
So you just um are as informed as you possibly can before.
Um You commit to a long term lease, Crystal Chen who is the Zer spokesperson.
Crystal.
Great to have you on here with us talking all things rents.
We gotta see what we can do about these New York City prices too much.
Thanks so much.
Thank you everyone.
We’ve got much more on wealth after the break.
You’re watching Yahoo Finance picture this, you hop in the car after a busy day of work, you punch your address in to Ways or whatever app that you’re using to avoid traffic and connect your phone so you can play some music all the while your car is tracking every move you make.
According to Counterpoint research, two out of every three cars sold feature embedded connectivity and this is expected to grow to almost 100% by 2030.
And the sales force survey finds 65% of drivers are unfamiliar with the concept of a connected car, internet oriented nonprofit, Mozilla spent over 600 hours researching various car brands as privacy and their practices.
Here were some of the takeaways.
We’ve got one of the authors of that report, Jen Krier who is the Mozilla product director of Privacy.
Not included.
Great to have you here on the show with us, Jen.
I mean, what was the most astounding finding from the hours of research?
Hundreds of hours of research that you put towards this study?
Well, uh the most astounding thing is that every car uh that people buy these days, it is bad for privacy.
There are no good options for new cars, for privacy, for somebody who wants to go out and buy a car and cares about that.
That was really disturbing.
Which of all of the vehicles that you studied was the worst at protecting privacy.
You know, it was really hard to pick a worst because they were all pretty bad.
Um You know, Tesla, of course, raised a lot of eyebrows.
Um but were they the worst?
You know, it’s hard to say, I mean, um Nissan said in their privacy policy that you had to consent to, they could collect information on your sexual activity, Kia so they could collect information on your sex life.
Others talked about genetic information.
Um So it’s really hard to pick one.
I think across the board, connected cars are all bad at privacy.
And so how can the connected cars?
Because, I mean, based on those surveys that we were just rattling off, it’s not gonna go anywhere any time soon.
How can they become better about protection of privacy?
Well, I mean, when you, when you think about privacy, you know, we’re gonna have to give up data in our connected world.
It’s just how it works.
And one what you want to see is, is a product that collects data, only collect the data.
It needs to give you the service.
So for a car, you want it to collect only the data, it needs to get you from point A to point B safely and, and then use it only for that no other reason.
Um Unfortunately, that’s not what’s happening with cars.
Cars are collecting an insane amount of data, some of it they use to get us from point a point be safely, but a lot of it, they use to make money off of us to um share for targeted advertising purposes to sell um to data brokers where insurance companies can scoop it up and, and raise our rates if we, if it looks like we’re driving poorly.
Um and, and then there’s the questions about, you know, there’s cameras in the car, there’s microphones in the car, there’s sensors.
So there are no how many people are in the car and how fast you’re going and how hard you’re breaking and what you’re listening to and all that can be gathered to create these inferences about us that know, you know, things like our intelligence, our abilities where we go for dinner every Thursday night.
And so it’s all a big problem and the solutions are, are way behind.
And so with that in mind, what are, what are some tips for people who are trying to take it upon themselves to protect their privacy while engaging with a very connected, very highly technological driving and, and motor vehicle experience.
Yeah, so, so I bought a car last year as I, as I was doing this research and it was a, it was a scary proposition, but a couple of things that I did and, and again, I kind of make recommend these tips with the caveat that they’re not all going to protect all of your privacy.
You just can’t do that with a car these days.
But a couple of things you can do are don’t download and install the app.
It means you’re going to give up some nice features like being able to remotely lock and unlock your car, start your car.
Um but it, it eliminates tracking.
Um don’t connect your phone to your car and I know that’s crazy because you’re like, well, how am I gonna play my tunes or, or do my navigation?
Um But that’s a privacy choice that you’re gonna have to make.
Um, I, I choose not to connect my phone to my car.
Um, but uh you know, again, it’s, it’s not a great um option and unfortunately none of the tips I give people are great options.
And so I think the best tip I can give people.
Um right now is to call your elected officials and say, you know, this is wrong.
Our privacy is more important than car companies bottom lines.
Um and every connected big tech company bottom lines and we need a strong consumer, federal privacy, consumer focused federal privacy law, which we don’t have in the United States.
And so pushing elected officials to, to make that happen would be maybe the best place to start.
A Absolutely Jen while we have you here just last.
I mean, it’s summer time.
We’ve got a lot of people traveling.
Perhaps they’re gonna be renting a vehicle that has some of these features in it.
I, I mean, I know I’ve been quick to say, all right, let me make sure that I can pair it with Bluetooth and make sure that I’m connected to, you know, any type of airplay that might be taking place with that vehicle because I have a long drive ahead of me.
What do people need to be remembering specifically for those who are renting a car out there?
Yeah, car rentals are really tricky because not only is that data potentially getting shared to the car rental company or the car dealer, um, the, the car company, but the next person that uses the car could see it.
And so again, I, I recommend don’t connect your phone to your car.
Um, you know, do it, do it the old fashioned way, you know, just keep your phone off of Bluetooth and unconnected and, and navigate most of your music that way.
Um If you do connect it, do your very best to wipe everything that’s connected off of the car and that can be tricky.
Um You know, you can, you can try and futz around with the settings and find a way to delete it and then you just have to hope that it actually deletes everything it might not.
Um So I think your best bet when you rent a car is just stay disconnected, do it the old fashioned way, keep your phone.
Um You know, and, and you know, have a Navigator over there, hopefully to, to do that.
All right.
Whipping out the old paper maps here, Jen Krider, who is the Mozilla product director of Privacy not included, Jen.
Great to see you here today.
Thanks so much for the tips.
Thank you.
Shifting gears here to an exciting new opportunity at Yahoo Finance.
We bring in Yahoo finance contributor, Ross Mac.
Now, Ross, you’ve got a brand new podcast out with Yahoo Finance with the first episode dropping noon Eastern time today.
What can you tell us about the financial freestyle and the first episode.
Well, one, this is exciting, right?
This is the first of its kind and I just love the opportunity to really give the audience just a new way to actually think about personal finance.
Right.
We’re gonna make this much more, easily, digestible.
And the great thing about it is we’re bringing in a lot of amazing people from all walks of life, whether it’s C suite employees at top financial firms, athletes, you name it.
But the great thing is that we all have a commonality and that is trying to make personal finance way more digestible, easy to understand.
And let’s just bring back that layer, right?
We can’t just continue to allow finance to be such a taboo topic that we talk about, right?
Like it’s very important that we’re talking about, you know, tips on retirement, tips on real estate, tips on, you know, the right accounts to open up for your Children.
And now you get to hear it from, you know, some great people that I feel as though are, you know, astronomically great at what they do.
And the good thing is now they are helping, you know, make it a lot easier for us to understand it because what they’ve did along their pathway to find success, they’re willing to share it with the audience.
And so I’m excited that we’re launching today and I think we should probably go into a a clip of it right now.
Well, let’s check out an exclusive clip.
Financial freestyle, check it out.
Sitting here right now.
2024 still, 40% of all Americans run out of money in retirement.
Right.
53% of African American households run out of money in retirement.
So we are looking at a system, if that system is broken, everything breaks down.
So, if your parents, you know, can’t run out of money in retirement, then you have to start funding them because they don’t have money.
So that’s taking money out of, out of what should be your uh you know, your nest egg, which you should be passing on to your kids.
So it’s just a generational deficit if we can’t retire the right way.
Financial freestyle with Ross Mac premieres today at 12 p.m. Eastern time will air a new episode every Monday.
Ross looking good.
Thanks so much.
Thank you.
Certainly, everyone coming up.
We’ve got much more wealth after the break.
Stick around the dawn of a new era for theme parks.
Six Flags and Cedar Fair expected to close their merger today in the combination of the two regional theme parks would create a combined entity valued at $8 billion shares expected to begin trading on the New York Stock Exchange as early as tomorrow.
July 2nd.
And our next guest sees meaningful upside, potential for investors.
For more on this.
I’m joined by James Hardman City like uh leisure and travel analyst, James, great to speak with you and grab some time as always here.
I mean, just the significance of this combination and what success looks like, post combination uh and deal for both of these companies now.
Yeah, I mean, it’s a big deal.
You don’t see a whole lot of M and A in this space.
I’ve been covering it for 15 years.
This is, this is far away, the biggest deal really the only deal of its kind uh this, this century.
Um And I think it creates significant value.
You talked about, you know, what success looks like.
Um You know, we, we think that value is created here a because um there’s a significant management upgrade, right?
The Cedar Fair management team is the steady hand that I think these six flags assets have needed for so long.
Um and have has, has been missing.
Uh Ultimately, they’ve been doing this for a very long time.
I think there’s a liquidity upgrade um in addition to sort of bringing together two small cap companies to make them a AAA mid cap company.
Uh Cedar Fair has historically been an M LP which just a lot of investors just ultimately don’t want to bother with.
It’s now gonna convert to a traditional C Corp, which I think helps and there’s significant synergy opportunities here as well.
What does this mean for the consumer?
I mean, a lot of households trying to figure out what theme park experiences are, are affordable for them right now as they’re kind of picking and choosing where they can play in the experience economy.
What does this mean for affordability once the consummation fully takes place here of this deal?
Yeah, I mean, I think there’s gonna be in, in a handful of markets, there’s gonna be an opportunity to bring together multiple parks uh in a season pass uh structure, right.
So I, I think maybe most notably of that Southern California market, if you live in Los Angeles, and, you know, you would consider going to either uh Six Flags, Magic Mountain or Knotts Bery Farm, which is a Cedar Fair Park.
Um One of them is north of L A.
One of them is south of LA.
I think there’s an opportunity there to get a season pass where you could get unlimited visits to both for a price that is, is probably gonna be less than a single day visit to, to Disneyland.
Um I think that’s a big opportunity now it’s not, you know, in most cases there isn’t a ton of overlap.
Um And so the consumers aren’t gonna see much of a difference, but I think there are a handful of cases in which they will James II.
I imagine that, you know, in your line of work, which, which sounds very fun as you’re kind of looking across these theme parks.
You know, maybe you get to go to one from time to time in different markets and really perhaps put the experiences up against one another.
What, what is the biggest value driver that consumers are really looking for from theme parks, especially in this economy?
Yeah, I mean, I think theme parks are, you know, first and foremost they’re an experiential uh product, right?
And, and what we’ve seen for at least the better part of the last decade is that experiences are winning out over, over consumer goods, right?
Um, I think in addition to that, it’s a, it’s a family friendly form of entertainment.
Uh, it’s safe, which was certainly, you know, a big, big uh draw coming out of the pandemic.
Uh, but also it’s a, it’s a way to take your family to have some fun to, to unplug, so to speak.
Um, these are assets that aren’t ever going to be, you know, at risk from the Amazons and the Googles of the world, right.
It’s getting outside is having fun with, with friends and family.
James.
I’ve been bullish on Dipping Dots since 06.
So hopefully that’s holding up right now, James Hardman, who is the City Leisure and travel analyst, James.
Thanks so much for taking the time.
Thank you.
Appreciate it.
Well, July 4th is just a couple of days away and while you may already be dreaming of sitting by the pool with a hot dog in one hand and a drink in the other beverage companies are already out in full force.
Getting ready for the biggest beer day of the year for more.
Let’s bring in Maggie Timon, who is the Heineken?
Say Ceo Maggie.
Great to have you here with us on the program.
I, I imagine that your entire team is revved up for this fourth of July.
What’s gonna look different from Heineken this year versus years past?
And how does that play into the overall strategy that you’re putting into the market?
Well, it’s more of the same.
We’re focused on our core brands, Heineken and Ose and in particular over July 4th, we have Heineken 00, the number one non alcoholic beer by value in the United States, five points further than our nearest competitor and we are making moderation.
Cool.
Um We are again up almost double digits again this year, the category is up double digits and at the forefront of igniting this nascent category when we launch, launched in 2018, uh we are here to stay and we’re looking forward to seeing more Americans uh pay, choose a Heineken 00 over the July 4th holiday weekend over the summer and for the rest of the year.
How is Gen Z specifically and, and the customer lifetime value and relationship that companies like Heineken look to have with that consumer cohort and consumer group.
How is Gen Z changing the, the appetite and the purchasing profile um that you’re seeing even from Heineken?
That’s a great question.
You know, we’re seeing Gen Z is whether it’s because of how they were brought up or, or, or if it’s because of post COVID.
Gen Z is a much more thoughtful, intentional, intentional, but also promiscuous.
They want to try new things.
And if you look at the beer or the alcohol beverage basket, 94% of people who buy non alcoholic beer also buy alcohol.
So it’s not instead of it’s in addition to so we see Gen Z choosing moderation when they want to choose moderation, but all consumers are also in that space.
So for us, it’s great that we have alcoholic products and 0.0 Heineken 00.
And also Dose’s Liman zero Salt in order to offer an option for any occasion, whether it’s Gen Z or beyond Gen Z, when you think about production for Heineken, you know, there have been a few different things to have to wade through.
There’s sustainability.
There’s of course, how you’re being able to make sure that every thing from the raw materials that goes in to some of these beverages in a world that is continuously uh changing because of climate, how you’re able to make sure that you’re able to kind of continue putting forth the same operation.
Uh But with a more kind of environmentally sound footprint as well, how, how do you navigate that right now?
And what are the changes that Heineken is making?
We’re very intentional, intentional with corporate social responsibility.
Look at, we’re making moderation.
Cool.
We’re looking at Net Zero, we’re, we’re refining and, and looking at tweaking our breweries and building your new breweries that are much more sustainable for Heineken Zero.
We are ensuring that we deliver sustainable, socially responsible product to the United States but also around the world.
We launched in 2017 and we are in over 100 countries already.
We are the number one non alcoholic zero alcohol brand across the world.
Just lastly, we only have 30 seconds left here.
What is your anticipation for how canned cocktails are going to continue to perform for Heineken?
Uh We don’t uh well in the United States right now, we don’t have canned cocktails.
We do see that spirits are growing because of canned cocktails outside.
If you exclude a ready to drink, cocktail, spirits are declining.
Uh We see a little bit of softness in the canned cocktail space over the last 12 weeks.
So let’s watch that space.
We know what Cap and Seltzers, certainly.
Ok. All right.
Yeah, just, I’m looking at the cans that were, were behind you and I was like, oh, you know what, that, that is another major trend that’s uh really come about within the industry and no doubt, top of mind for you and the team there, Maggie Timony, who is the Heineken USA CEO.
Thank you so much for taking the time, Maggie.
Thank you so much, Brad.
Thank you.
Absolutely.
That’s it for wealth, everyone.
I’m Brad Smith.
Thank you for watching.
Stay tuned for market domination.
Shawna Smith and Josh Lipton.
That’s coming up at 3 p.m. Eastern time.
You don’t want to miss it.
Oh.
