Episode 137: Is this seat taken?

MAK: Welcome back to Money with Mak & G.  Thanks for being here, this is for the week ended November 5th, 2021.  Don’t forget to LIKE, SUBSCRIBE and COMMENT on the podcast.

GRANT: What a fantastic week for dad to celebrate his birthday.  He has been on cloud 9.  The markets are up into new territory, and he’s getting to travel a bit.  Why don’t we jump right in?

MAK: This is Mak and these are the markets. We’ve hit new highs in each of the last 7 trading days.  This is the most since 2013. Grant, why are we seeing these new highs?

GRANT: When the economy is running well, people spend more money and companies report higher earnings. Companies are worth more and people will want to invest in them. 

MAK: Why don’t we name a couple of good indicators that show the economy is working well:

GRANT: Good earnings for companies

MAK: A nice low level of unemployment

GRANT: Not too much Inflation

MAK: Good interest rates

GRANT: So, what’s going on? 

MAK: Last week, we saw the Dow, Nasdaq and S&P end the week on new highs.  This was due to a positive move in employment, good earnings, and the Delta virus numbers are better.

GRANT: Plus, even though inflation is rising, it’s believed it will stabilize and come down.  That means the government isn’t planning on raising interest rates for a while, that’s also good news.

MAK: Excellent G.  You know as we want to invest, understanding the economy a bit is helpful.  It also helps to explain some things around the house better.

GRANT: I agree.  Mom and dad tend to have more money when things are good. Plus, it lets us know, as we get older if we can get a good job. If money is tight, no one wants to hire at companies.

MAK: So, it can be important.  Do you think you can look at other information to determine where the economy is headed?  Do you think travel can give any insights?

GRANT: Well, most people don’t go on nice vacations if the economy is bad when they don’t have money.  I think that can be an excellent piece of info, or indicator of the economy.

MAK: First, the airlines, like United, Delta, American, and LOVE that’s L-U-V, the call symbol for Southwest showed their earnings for the three months ended September, called third quarter.  

GRANT: I saw that.  Their stocks jumped on Friday from around 5% to 8% in one day!!  Over the last 18 mos, if you would have bought all four equally, you’d be up about 80%.

MAK: That’s crazy.  And, Air BnB, which helps people rent out their homes to travelers, they showed a 280% increase in profits, that’s almost 3 times better than last year during the same time.

GRANT: So, that’s got to tell us that something positive is happening. 

MAK: You got that right. It gives you some great information, but….. could you have seen it someplace else possibly before the stock jumped?

GRANT: Would that be like seeing a fashion trend?  You see more and more people wearing chunky loafers.  It tells you it’s popular.  So, the best chunky loafer maker will win.

MAK: Nice. Hey, I like the fashion trend that you started.  It’s Color Clashing. Yep, Color Clashing.  It’s a real fashion trend and it’s exactly how it sounds. And… you do it so well.

GRANT: Haha.  Seriously, those models could never pull it off as well as I do.  Have you seen some of the other hottest fashion trends:

MAK: Wide leg pants

GRANT: Hot Goth

MAK: Y2k Fashion

GRANT: Loud Logos, that’s a FAV

MAK: Noyce….. Those are some 2021 fashion trends. Not even sure what they all are.  But, back to our talk. How can you tell if travel is picking up? 

GRANT: Maybe MORE people are….:

MAK: Wearing sunglasses?  

GRANT: Buying sunscreen?  

MAK: Playing with Beach balls? 

GRANT: Buying bathing suits?

MAK: Wearing sandals?

GRANT: It’s much more simple.  You can look at the number of people flying and who are on the move. If you see the number of air travelers in the US, you’d find something interesting.

MAK: Are you talking about the TSA? The Transportation Security Administration tracks people flying. They’re the ones that run you through the metal detectors. They make you take out:

GRANT: Your shoes

MAK: Your belt

GRANT: Liquids over a couple of ounces

MAK: Computers 

GRANT: Jewelry and more

MAK: Those poor TSA agents.  They should get hazard pay for dealing with YOUR shoes. 

GRANT: Very funny.  They screen you, to make sure you’re not making the flight unsafe. So, nothing sharp or explosive. Otherwise, it could be dangerous for everyone.

MAK: That’s good to know.  Do they look at the luggage too?

GRANT: Yep, they go through about 5 million bags A DAY!!! Many through x-ray machines. 

MAK: I hope they never check your bag. Sometimes stuff lives in there, and it’s kind of smelly.

GRANT:  Wow, beat up on Grant day.  Thanks.  Anyway.. online, I found that there were about 268 million people screened from January through October last year. This year it was 458 mill.

MAK: That’s a ton more.  But if we compare it to 2019, there were 697 million people over the same period.  So, in round numbers, it went from 700 down to 270 and is back up to about 460.  

GRANT: Can you say it sounds like a possible:

MAK/GRANT: RECOVERY!!!

GRANT: It does sound promising. A great bday present! A market high and back to traveling!

MAK: Definitely agree with that one.  By asking a couple of questions, you can start to get a feel for the economy. And we know a 

GRANT: Better economy means

MAK: Better money movement

GRANT: Better jobs

MAK: Better stock prices.

GRANT: Don’t forget that when things go well, build your savings or emergency fund.

MAK: Nice one G.  Way to get that in there!!

GRANT: Thanks.  And, thank you for being here.  We’ll see you next time for more…..

GRANT/MAK: Money with Mak & G.  Bye!!