WEBVTT - Agricultural Economy Is Softer, More Vulnerable Now: CoBank CEO 0:00:05.800 --> 0:00:08.360 Welcome to the Bloomberg P and L Podcast. I'm pim 0:00:08.400 --> 0:00:11.160 Fox along with my co host Lisa A. Brahmowitz. Each 0:00:11.280 --> 0:00:14.440 day we bring you the most important, noteworthy, and useful 0:00:14.480 --> 0:00:17.079 interviews for you and your money, whether you're at the 0:00:17.120 --> 0:00:20.360 grocery store or the trading floor. Find the Bloomberg P 0:00:20.520 --> 0:00:27.440 and L Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com. 0:00:27.480 --> 0:00:31.520 We are broadcasting from the Power in Practice Alumni Workshop 0:00:31.600 --> 0:00:37.160 for Commonwealth Financial Network taking place in Orlando, Florida. Topic now, though, 0:00:37.400 --> 0:00:42.160 is the agriculture industry. What with the trade wars between 0:00:42.159 --> 0:00:45.760 the United States and China, could farmers in the United 0:00:45.800 --> 0:00:49.239 States be affected for many years to come. Joining us 0:00:49.240 --> 0:00:51.880 now to help us answer to this question is Tom Halverson. 0:00:52.240 --> 0:00:55.560 He is the president and the chief executive of KO Bank, 0:00:56.000 --> 0:00:59.040 assets under management more than a hundred and twenty five billion. 0:00:59.120 --> 0:01:01.440 They are based in Denver. Co Bank is one of 0:01:01.480 --> 0:01:06.399 the four banks of the Farm Credit System. It provides loans, leases, 0:01:06.440 --> 0:01:11.640 and other financial services to rural communities across the United States. Tom, 0:01:11.680 --> 0:01:13.880 thank you very much for being with us. Tell us 0:01:13.920 --> 0:01:17.959 the current state of health of the agriculture industry when 0:01:17.959 --> 0:01:22.240 it comes to growing soybeans, certainly, I'm happy to do that. 0:01:22.319 --> 0:01:24.120 The fact of the matter is, you know, we are 0:01:24.720 --> 0:01:27.800 in the midst of this trade turmoil that you've been 0:01:27.840 --> 0:01:31.000 talking a great deal about as a result of negotiations 0:01:31.000 --> 0:01:33.240 have now been underway for quite some period of time. 0:01:33.760 --> 0:01:36.760 But if you roll the tape back further, the agricultural 0:01:36.760 --> 0:01:40.600 economy the United States UH started softening well back in 0:01:41.800 --> 0:01:43.880 fourteen periods. So if you look at the Department of 0:01:43.920 --> 0:01:47.920 Agricultures owned data on net farm income, for example, it's 0:01:47.960 --> 0:01:53.480 fifty lower today than it was in So before UH 0:01:53.560 --> 0:01:57.960 the disalignments that we've been experiencing with our NAFTA partners 0:01:57.960 --> 0:02:01.440 and with China occurred, the agri cultural economy was already 0:02:01.480 --> 0:02:05.880 soft UH, and the consequences of the negotiations UH that 0:02:06.000 --> 0:02:09.200 we've been experiencing over the over the recent months have 0:02:09.400 --> 0:02:13.600 exacerbated that tendency as a result of UH, the teriffs 0:02:13.680 --> 0:02:17.000 that we have imposed, in the retaliatory tariffs that Mexico, 0:02:17.080 --> 0:02:21.000 Canada and China have imposed UH and and response. So 0:02:21.480 --> 0:02:24.919 the agricultural economy was soft before it's it's softer and 0:02:25.320 --> 0:02:28.440 more vulnerable today. So Tom, what does that mean in 0:02:28.560 --> 0:02:32.560 terms of whether the US agricultural industry is headed for 0:02:32.560 --> 0:02:36.360 a recession, whether we accept well, whether we expect bankruptcy 0:02:36.400 --> 0:02:37.960 is to pick up as we've seen a little bit 0:02:38.480 --> 0:02:42.639 in the Upper Midwest. Well, you know, let's step back 0:02:42.680 --> 0:02:46.120 and answer that by recognizing that the agricultural economy is 0:02:46.160 --> 0:02:50.639 one of the most positive participants in the trade balance 0:02:50.680 --> 0:02:54.320 the United States. We have grown US exports of agricultural 0:02:54.320 --> 0:02:57.000 products over the last twenty five years dramatically, and it 0:02:57.040 --> 0:03:00.440 makes a very positive impact on the trade in current 0:03:00.440 --> 0:03:03.919 account balance of the country. But you're exactly right. The 0:03:04.600 --> 0:03:07.919 fact of the matter is that is manifesting itself in 0:03:07.919 --> 0:03:11.359 in UH, in stress in the rural economy, in the 0:03:11.400 --> 0:03:15.800 wide areas of the of of the country that manifests itself, 0:03:15.880 --> 0:03:20.120 and stress and and and bankruptcies and difficulties. Looking in 0:03:20.280 --> 0:03:23.560 various sectors, whether it's you know, soybean producers and growers 0:03:23.600 --> 0:03:27.560 whose whose markets are are under stress or UH dairy 0:03:27.560 --> 0:03:31.720 production complex for example, is experiencing similar levels of stress. 0:03:31.720 --> 0:03:33.240 And then when you go up to the next level, 0:03:33.280 --> 0:03:37.720 which is the aggregators of producers, products, agricultural co ops 0:03:37.720 --> 0:03:42.440 and the like, UH, they they may be experiencing difficulties 0:03:42.480 --> 0:03:45.360 as well. So there's belt tightening, and that means that 0:03:45.400 --> 0:03:48.840 people buy less new you know, machinery and equipment, and 0:03:48.840 --> 0:03:52.800 they're looking for ways to reduce their costs. And they 0:03:52.800 --> 0:03:55.440 are being caught for the first time in a decade 0:03:55.440 --> 0:03:57.480 as the rest of the economy is in a rising 0:03:57.520 --> 0:04:01.080 interest rate environment where for many years is now interest 0:04:01.160 --> 0:04:06.200 rates weren't really a significant component of of production agricultural 0:04:06.400 --> 0:04:09.720 cost side. Uh, it's becoming much more so. So for 0:04:09.760 --> 0:04:13.160 people who entered this period with from a position of 0:04:13.160 --> 0:04:16.719 relatively high leverage, you know, that exacerbates their tensions and 0:04:16.760 --> 0:04:19.960 their and their credit stress. Tom, does this does this 0:04:20.080 --> 0:04:23.400 uncertainty and this stress that you're describing, does it bleed 0:04:23.480 --> 0:04:26.560 over into other areas of the agricultural industry? And I'm thinking, 0:04:26.600 --> 0:04:29.760 because you know, your customers are not just food and 0:04:29.800 --> 0:04:35.920 agri business, but it's rural power communications, You've got water cooperatives, also, 0:04:36.720 --> 0:04:40.720 rural community facilities, agricultural credit association. You've got a variety 0:04:40.760 --> 0:04:42.960 of customers. Oh no, you're absolutely right. So if you 0:04:43.000 --> 0:04:45.919 look across wide swaths of the Upper Midwest, look at 0:04:45.960 --> 0:04:49.320 the Dakotas in Nebraska, Montana, for example, those are just 0:04:49.400 --> 0:04:52.560 a couple of examples but there is a very high 0:04:52.640 --> 0:04:56.760 correlation between the health and well being of the agricultural 0:04:56.760 --> 0:04:58.840 economy and the health and well being of the rural 0:04:58.839 --> 0:05:02.400 economy as a whole, because all of those industries, as 0:05:02.440 --> 0:05:06.040 you say, are very highly correlated and inter related. So 0:05:06.440 --> 0:05:08.279 when one of the biggest or the biggest in the 0:05:08.279 --> 0:05:12.040 case of agriculture, suffers, that has big knock on effects 0:05:12.080 --> 0:05:14.880 for the for the economy as a whole. You know, 0:05:14.960 --> 0:05:16.520 one thing that I'm struck by is when you were 0:05:16.560 --> 0:05:20.000 talking about how the entire agricultural industry in the US 0:05:20.080 --> 0:05:22.920 had been struggling a bit or seeing a slowdown for 0:05:22.960 --> 0:05:26.080 a number of years even before the trade tensions. I'm wondering, 0:05:26.200 --> 0:05:29.120 how much are people blaming trade for things that were 0:05:29.200 --> 0:05:33.159 already in place before those tensions emerged. Well, that's a 0:05:33.200 --> 0:05:36.880 good question people often get. Everyone gets confused and the 0:05:36.920 --> 0:05:41.120 difference between causation and correlation and and uh, you know, 0:05:41.160 --> 0:05:43.359 people look at what's happening, and they look at the 0:05:43.400 --> 0:05:46.359 headlines and the like, and it's easier to uh, to 0:05:46.480 --> 0:05:49.760 blame you know, another country or a market thing that's 0:05:50.160 --> 0:05:53.120 beyond your control. And I'm sure that there's some of 0:05:53.160 --> 0:05:56.359 that going on, But I find in my experience that 0:05:56.360 --> 0:05:59.440 that farmers and ranchers and people in the agricultural industry 0:05:59.440 --> 0:06:02.600 in the United States are some of the most thoughtful, smartest, 0:06:02.720 --> 0:06:05.440 well informed people about what's going on in the world 0:06:05.839 --> 0:06:08.120 that you can find anywhere. And the reason for that is, 0:06:08.160 --> 0:06:10.279 for two two and a half decades now, we have 0:06:10.440 --> 0:06:14.400 dramatically grown our export markets. So there are lots and 0:06:14.440 --> 0:06:16.680 lots of farmers and ranchers who's been all over the 0:06:16.680 --> 0:06:21.080 world making relationships with their Chinese customers or their or 0:06:21.080 --> 0:06:23.760 their customers and other parts of the world. So they're 0:06:23.760 --> 0:06:27.800 pretty attentive to what's happening and the underlying causes and 0:06:28.000 --> 0:06:31.160 market factors and supply and demand factors that affect the 0:06:31.200 --> 0:06:35.240 prices for their commodities. Well, in that case, what are 0:06:35.279 --> 0:06:38.839 they doing or can they do anything in order to 0:06:39.080 --> 0:06:43.960 mitigate the effects of these tariff wars? Well, I think everybody. 0:06:44.000 --> 0:06:46.120 If you go out and ask you go out and 0:06:46.160 --> 0:06:48.320 ask our customers, or go out and ask people in 0:06:48.440 --> 0:06:50.320 rural parts of the country, you'll find Yeah, they're all 0:06:50.360 --> 0:06:54.360 doing things. Number One, they're watching it with great care, uh, 0:06:54.360 --> 0:06:57.520 and they're trying to take it into consideration as they 0:06:57.560 --> 0:06:59.760 make their decisions. For next year, for example, you know, 0:07:00.040 --> 0:07:05.000 harvest is done, there's a gigantic crop of of agricultural 0:07:05.040 --> 0:07:08.880 commodities uh that's not being purchased at the moment, for example, 0:07:08.880 --> 0:07:11.600 in the case of soybeans by China. Uh. And so 0:07:11.640 --> 0:07:13.880 we have a lot of commodities with no with no 0:07:14.040 --> 0:07:17.640 market or an insufficient market, and farmers all over the 0:07:17.720 --> 0:07:19.960 Upper Midwest, for example, are having to decide what are 0:07:19.960 --> 0:07:21.240 they going to do next year? Are they going to 0:07:21.280 --> 0:07:23.960 grow as many soybeans as they did this year? Given 0:07:24.000 --> 0:07:26.920 the state of trade relationships? Are they gonna uh you 0:07:26.920 --> 0:07:29.240 know trade are they going to produce less soybeans and 0:07:29.280 --> 0:07:31.720 more corn? You know? And that has big knock on 0:07:31.800 --> 0:07:37.840 implications on seed suppliers, uh, fertilizer suppliers, you know, machinery 0:07:37.880 --> 0:07:40.800 manufacturers and all those people and farmers and ranchers are 0:07:40.920 --> 0:07:44.400 right now having to try and make decisions about what 0:07:44.440 --> 0:07:46.440 their capital structure and their business plan is going to 0:07:46.520 --> 0:07:49.560 be for twenty nineteen. Tom Howiverson, thank you so much 0:07:49.560 --> 0:07:52.120 for being with us. It's really an important area to 0:07:52.200 --> 0:07:54.720 keep an eye on, certainly as we've seen the price 0:07:54.760 --> 0:07:58.160 of soy in particular really flipping around depending on the 0:07:58.200 --> 0:08:01.560 trade headlines. Tom howiverson his chief executive officer of Kobank 0:08:02.080 --> 0:08:05.360 uh joining us here where we are broadcasting live from 0:08:05.440 --> 0:08:10.080 Commonwealth's Power and Practice Alumni Workshop in Orlando, Florida. Coming 0:08:10.160 --> 0:08:13.920 up Bloomberg Politics, Policy, power and law. A lot to 0:08:13.920 --> 0:08:17.240 talk about, including about some of the tariffs and trade tensions. 0:08:17.400 --> 0:08:19.880 Are they easing? Are they not? What are the details 0:08:19.920 --> 0:08:22.600 we don't know? Does it for us? And Lisa Almos 0:08:22.600 --> 0:08:25.480 along with my coast and colleague Pim Fox. This is Bloomberg. 0:08:28.240 --> 0:08:31.080 I want to turn now to one of the headline 0:08:31.080 --> 0:08:35.679 events of the day. This is really an incredible contribution 0:08:35.880 --> 0:08:39.680 from a contributor to Bloomberg Opinion, former head of the 0:08:39.720 --> 0:08:44.360 Bank of England, Mervin King, writing a column. Well, I'm 0:08:44.360 --> 0:08:47.840 gonna let Clive Crook sort of give us the details 0:08:47.880 --> 0:08:51.200 there because he was the editor for this particular column. 0:08:51.240 --> 0:08:55.320 And Clive Crook, Bloomberg Opinion editor, joins us now from Washington, 0:08:55.640 --> 0:09:00.800 d C. Clive, what was it like to actually receive uh, 0:09:01.040 --> 0:09:07.880 Lord King's column at this particular time when the Brexit 0:09:08.040 --> 0:09:12.320 is got coming up for a vote. Well, it's uh, 0:09:12.360 --> 0:09:15.160 it's a fantastic piece. That's anything to say about it? 0:09:15.160 --> 0:09:18.160 In my view. I think it's the best piece on 0:09:18.200 --> 0:09:22.320 the subjects I've read, and it's a withering attack on terrace. 0:09:22.400 --> 0:09:27.000 Some mays Brexit deal and he explains what's wrong with it, 0:09:27.200 --> 0:09:30.080 essentially that it gets the worst of all worlds. You know, 0:09:30.120 --> 0:09:33.240 it isn't a it isn't a compromise any meaningful sense. 0:09:33.280 --> 0:09:37.400 It sacrifices British sovereignty and it and it will cause 0:09:37.440 --> 0:09:41.160 economic damage as well. So I mean it's a terrific piece. Well, Clive, 0:09:41.320 --> 0:09:45.760 why is he writing this now? Well, I mean, you 0:09:45.800 --> 0:09:48.440 know the decision is about to be made. I'm sure 0:09:48.480 --> 0:09:51.600 he wants to influence it. He's calling on Parliament to 0:09:51.679 --> 0:09:54.080 reject the deal, and if they read the piece and 0:09:54.160 --> 0:09:56.000 think about it, I think they might well decide to 0:09:56.040 --> 0:09:58.760 do just that. Well, any idea being that the deal 0:09:59.000 --> 0:10:01.080 is the worst of both old as you were just saying, 0:10:01.520 --> 0:10:04.840 I guess what I'm trying to understand is is he 0:10:04.880 --> 0:10:08.000 trying to sort of augur for what uh the European 0:10:08.120 --> 0:10:11.600 Union judge just ruled, which is perhaps take a revote 0:10:11.760 --> 0:10:15.000 and try to undo Brexit altogether. Well, I think his 0:10:15.120 --> 0:10:19.040 position in this column is not um, you know, pro 0:10:19.200 --> 0:10:24.080 Brexit or anti Brexit. It's against this specific deal. Um. 0:10:24.160 --> 0:10:27.200 So you know, I think there's another it's a separate issue. Really, 0:10:27.400 --> 0:10:30.120 you know what happens next, what kind of deal Britain 0:10:30.160 --> 0:10:33.760 should seek. But the point is that this particular deal 0:10:33.800 --> 0:10:37.440 that's on the table is terrible. That's what That's what 0:10:37.720 --> 0:10:40.400 Irvin King is arguing. UM. So he doesn't really go 0:10:40.480 --> 0:10:42.280 to the question of you know, so do we have 0:10:42.320 --> 0:10:44.800 a no deal brexit or do we do we stay 0:10:44.840 --> 0:10:47.679 in Um, that's not what he's grampling with. He's saying 0:10:47.720 --> 0:10:50.880 this particular deal is the result of, as he puts it, 0:10:50.960 --> 0:10:54.679 monumental in competence, and he calls it a betrayal of Britains. 0:10:54.720 --> 0:10:57.559 It's this deal that's bad. Now the e c J 0:10:58.280 --> 0:11:00.800 H Well, it isn't an e c g J ruling, 0:11:01.040 --> 0:11:05.199 you know, it's it's advice from a lawyer that the 0:11:05.400 --> 0:11:09.640 c J usually takes very seriously. UM. So I do 0:11:09.720 --> 0:11:15.280 think it's increased the chances that Britain could unilaterally revoke 0:11:15.640 --> 0:11:20.680 Article fifty and put the whole process on pause. Um. 0:11:20.720 --> 0:11:23.240 But it doesn't need to be noted that, you know, 0:11:23.280 --> 0:11:27.240 the European Commission is arguing the opposite, and the European 0:11:27.640 --> 0:11:31.520 Unions leaders are also of the view that revoking Article 0:11:31.640 --> 0:11:35.200 fifty and halting this process in its tracks would require 0:11:35.240 --> 0:11:39.080 the unanimous agreement of the other European governments. So although 0:11:39.120 --> 0:11:43.559 this advice I think increases the probability that the Court 0:11:43.640 --> 0:11:47.920 itself will rule that a unilateral revocation is possible, it 0:11:47.960 --> 0:11:50.160 doesn't make it a done deal by any means, And 0:11:50.200 --> 0:11:53.319 the Commission and the European Union's leaders are pushing back 0:11:53.360 --> 0:11:57.400 against that view. What has been the reaction from European 0:11:57.840 --> 0:12:02.160 leaders and would they want Britain to come back into 0:12:02.200 --> 0:12:06.679 the European Union. Well, that is an excellent question. Um, 0:12:06.720 --> 0:12:09.000 I'm not sure what the answer is yet. I mean, 0:12:09.000 --> 0:12:13.880 the truth is they haven't really addressed it collectively. You know, 0:12:13.960 --> 0:12:18.280 there is no, as it were, agreed European Union view 0:12:18.320 --> 0:12:22.640 on this. Some European Union leaders have said that they 0:12:22.679 --> 0:12:26.199 want Britain to stay in, but um, I don't think 0:12:26.320 --> 0:12:29.640 that view would be unanimous myself. I think if Britain 0:12:29.720 --> 0:12:34.960 did revoke Article fifty, um, I think some EU leaders 0:12:35.040 --> 0:12:37.560 might wonder if that was actually in the interests of 0:12:37.559 --> 0:12:40.840 the European Union. You know, many people in Europe are 0:12:40.880 --> 0:12:44.720 as sick of the Brexit process as many people in 0:12:44.800 --> 0:12:47.400 Britain are and I think they just want Britain and 0:12:47.440 --> 0:12:51.520 their complaints to go away. So I don't think, you know, 0:12:51.640 --> 0:12:55.959 Britain would be welcomed back unanimously with open arms by 0:12:55.960 --> 0:12:58.520 any means. Well, Clive, just in thirty seconds here, I'm 0:12:58.559 --> 0:13:01.200 wondering what's the risk and how much does it go 0:13:01.440 --> 0:13:04.760 up that there is a hard Brexit or a no 0:13:04.960 --> 0:13:07.640 deal Brexit, which is a worst case scenario for a 0:13:07.679 --> 0:13:11.200 lot of people if this deal is rejected. I think 0:13:11.200 --> 0:13:15.080 it is a significant risk. Um. I think, um, you know, 0:13:15.120 --> 0:13:17.920 because the problem is that it's the default option. Time 0:13:18.000 --> 0:13:22.360 is running out now, and if nothing else happens, Britain 0:13:22.440 --> 0:13:27.000 leaves the European Union on March twenty nine, so interventions 0:13:27.000 --> 0:13:31.160 are necessary to stop that process. And um, I think 0:13:31.240 --> 0:13:34.920 there is a risk, almost by accident, um, that Britain 0:13:35.000 --> 0:13:37.600 might decide it wants to stay after all, or it 0:13:37.640 --> 0:13:40.320 wants to slow this process down, and it might just 0:13:40.360 --> 0:13:42.920 not be possible to do that. So I think a 0:13:43.040 --> 0:13:47.959 hard Brexit is a real, a real possibility. Clive Crook, 0:13:48.120 --> 0:13:49.880 thank you so much for being with us. Clive Crook, 0:13:49.960 --> 0:13:54.559 Bloomberg Opinion editor, talking about that fabulous Mervin King Carlin 0:13:54.640 --> 0:13:57.800 Murvin King, of course, is a former Bank of England governor, 0:13:57.880 --> 0:14:00.640 talking about how the current deal on the table waiting 0:14:00.640 --> 0:14:03.320 to be voted for is the worst of both worlds, 0:14:03.440 --> 0:14:07.120 arguing against voting for it. Meanwhile, perhaps there's a little 0:14:07.120 --> 0:14:09.360 bit of a glimmer saying that perhaps there's a chance 0:14:09.400 --> 0:14:15.960 for them to take a revote on Brexit. We are 0:14:16.000 --> 0:14:21.840 broadcasting live from Commonwealth's Power and Practice Alumni Workshop in Orlando, Florida, 0:14:22.080 --> 0:14:25.120 and we are joined by Marianna Goldenberg, founder of Cure 0:14:25.280 --> 0:14:29.520 Wealth Management. Marianna, I'm so glad that you're here because 0:14:29.520 --> 0:14:32.120 there have been a series of tax changes that have 0:14:32.320 --> 0:14:35.560 actually changed the calculus for some people, including as we've 0:14:35.600 --> 0:14:38.760 discussed on this show with respect to divorce, because after 0:14:38.800 --> 0:14:43.000 this year, I believe alimony payments will not be tax deductible. 0:14:43.280 --> 0:14:46.800 So I'm curious from you whether you're seeing more people 0:14:47.160 --> 0:14:51.960 taking that into account, expediting their divorces this year and 0:14:52.000 --> 0:14:54.800 what you're expecting into your end. Thank you, Lisa for 0:14:54.880 --> 0:14:57.560 having me on your show. I'm very honored, and thank 0:14:57.600 --> 0:15:00.160 you my broke a deala Commonwealth Financial and Joe in 0:15:00.240 --> 0:15:05.320 particular for having me on the show. Uh you're absolutely right. UM, 0:15:05.360 --> 0:15:08.120 I do see quite a bit of divorces happening today 0:15:08.520 --> 0:15:10.840 due to the changes in the tax law. Just a 0:15:10.840 --> 0:15:14.200 little bit of a background. I am a Certified Divorce 0:15:14.280 --> 0:15:20.240 Financial Analyst, which is a designation that you receive UM 0:15:20.440 --> 0:15:24.120 and helps you understand the laws, the divorce laws from 0:15:24.200 --> 0:15:29.000 legal standpoint and also also financial ramifications of UM going 0:15:29.040 --> 0:15:33.520 through divorce. UM. As you discussed before, there are some 0:15:33.600 --> 0:15:39.000 changes happening in two thousand nineteen. The alimony that used 0:15:39.040 --> 0:15:42.600 to be deductible for people paying the alimony and taxable 0:15:42.640 --> 0:15:47.920 for the receivers is no longer be taxed. So what's 0:15:47.960 --> 0:15:52.200 happening now People are rushing in to settle their divorces 0:15:52.240 --> 0:15:54.160 before the end of the year because they will be 0:15:55.040 --> 0:16:00.200 grandfathered starting in two thousand nineteen UM. And it's quite 0:16:00.200 --> 0:16:04.440 an interesting phenomena because people are trying to figure out 0:16:04.440 --> 0:16:12.600 that creative ways to UH to split the assets and 0:16:12.760 --> 0:16:17.280 make sure that two parties UH separate for the rest 0:16:17.280 --> 0:16:22.040 of their life and stay financially UM strong and able 0:16:22.080 --> 0:16:25.480 to build back their resources after they go through divorce. 0:16:26.920 --> 0:16:31.240 So that's that's what's been happening in different areas, and 0:16:31.360 --> 0:16:35.680 I think UH specifically, women get really short changed in 0:16:35.760 --> 0:16:40.320 this whole rush to do this because they don't quite 0:16:40.360 --> 0:16:44.080 understand what that means to them financially down the road. 0:16:44.520 --> 0:16:47.480 Everything looks at it today. Okay, today, it's gonna cost 0:16:47.480 --> 0:16:50.560 me X number of dollars in taxes. They don't look 0:16:50.600 --> 0:16:54.000 at what it will be in the future. Uh. If 0:16:54.040 --> 0:16:56.920 I settled with retirement funds, am I able to live 0:16:57.000 --> 0:17:00.240 comfortably down the road using this fund to? Am I 0:17:00.240 --> 0:17:04.480 better off taking the taxable investments and create a cash 0:17:04.520 --> 0:17:08.440 flow from there. So I think that's the rush decision 0:17:08.520 --> 0:17:12.199 that that unfortunately is caused by the new regulations. But 0:17:12.280 --> 0:17:14.679 I think there will be much more creative ways of 0:17:14.720 --> 0:17:17.760 handling down the road. Um, if people spend time and 0:17:18.040 --> 0:17:22.440 look at the overall picture, not at what's happening today. Maryanny, 0:17:22.520 --> 0:17:25.280 you excuse me. You earned a degree in mathematics and 0:17:25.320 --> 0:17:28.840 finance from the Wharton School, University of Pennsylvania. Many people 0:17:28.840 --> 0:17:31.679 are familiar with that. How many people are familiar with 0:17:31.720 --> 0:17:38.080 the designation Certified Divorce Financial Analysts. Thank you for asking. Um, 0:17:38.119 --> 0:17:41.080 it's it's a question that I've been asked a lot. 0:17:41.800 --> 0:17:46.680 When I initially received the designation was into about eight 0:17:46.760 --> 0:17:49.520 years ago and there are not that many of us 0:17:49.720 --> 0:17:53.080 that we're doing that. Uh, today I see it much 0:17:53.119 --> 0:17:56.119 and much more. The reason I looked into this and 0:17:56.160 --> 0:17:59.520 I thought it would be very um helpful for me 0:17:59.560 --> 0:18:03.840 in my actus is because as I my practice matured 0:18:04.080 --> 0:18:09.320 from starting at Maryland and spending ten years there in 0:18:09.359 --> 0:18:12.560 another eleven at LPL, I realized that more and more 0:18:12.600 --> 0:18:15.720 of my clients are becoming a women that are were 0:18:15.760 --> 0:18:20.359 referring other women, um because they either were state at 0:18:20.400 --> 0:18:23.359 home moms that needed help with finances, or they were 0:18:23.480 --> 0:18:27.159 very successful executives that were busy building their career and 0:18:27.240 --> 0:18:30.679 not having enough time spent on the financial side of it, 0:18:30.800 --> 0:18:35.560 or taking or using their employee I'm sorry, employer benefits 0:18:35.920 --> 0:18:40.199 to better their life. So to me, this was an 0:18:40.240 --> 0:18:42.760 ability to learn something that I didn't know on the 0:18:42.840 --> 0:18:47.680 legal side, and ability to work with other advisors such 0:18:47.720 --> 0:18:50.520 as their attorneys or c p a s to make 0:18:50.560 --> 0:18:53.200 sure that as a team we look at the well 0:18:53.240 --> 0:18:57.240 being of people. Just thirty seconds, I'm wondering, have you 0:18:57.280 --> 0:18:59.800 seen a fewer or more women wanting to go into 0:18:59.800 --> 0:19:03.600 the advisory business? Um? I wish I could say I 0:19:03.640 --> 0:19:06.600 see more. It's much more than I started Uh, the 0:19:06.640 --> 0:19:09.320 statistics are showing that when I started, there was about 0:19:09.840 --> 0:19:15.600 five women for each hundred female or male advisors, and 0:19:15.760 --> 0:19:19.959 right now I've been seeing sixteen percent, where at Commonwealth 0:19:20.040 --> 0:19:23.800 it's a little higher. We're about female advisors, which is phenomenal. 0:19:24.280 --> 0:19:26.719 Thank you very much for being with us and sharing 0:19:26.760 --> 0:19:31.040 all this information. Much appreciated. Marianna Goldenberg is the founder 0:19:31.119 --> 0:19:35.119 of Curo Wealth Management. They are based in Langhorne, Pennsylvania. 0:19:35.480 --> 0:19:40.520 We are broadcasting from the Power in Practice Alumni Workshop 0:19:40.880 --> 0:19:44.879 for Commonwealth Financial Network in Orlando, Florida. You're going to 0:19:44.920 --> 0:19:47.399 Disney World? I don't think so. I think maybe our 0:19:47.480 --> 0:19:50.880 engineering expert Charlie Vulmer will make a trip to Disney World. 0:19:50.880 --> 0:19:53.880 What you're wearing? Your mouse ears? No? No, these are 0:19:53.960 --> 0:19:58.560 my own. I know it's confusing, but thank you for that. 0:20:01.320 --> 0:20:05.280 We are broadcasting from the Power in Practice Alumni Workshop 0:20:05.320 --> 0:20:09.440 at Commonwealth Financial Networks annual meeting here in Orlando, Florida. 0:20:09.560 --> 0:20:12.399 Joining us now is Tim Dessetti. He is a senior 0:20:12.520 --> 0:20:17.000 partner at Infinitas. They are based in Overland, Kansas, but 0:20:17.119 --> 0:20:19.720 he joins us here on site. Tim, thank you very 0:20:19.800 --> 0:20:21.560 much for being here. I want to jump right into 0:20:21.560 --> 0:20:23.920 it because I think one of the issues that you 0:20:24.000 --> 0:20:27.919 have experienced with is crucial to the industry, and that 0:20:28.080 --> 0:20:32.720 is handling consolidation and mergers. How do you put together 0:20:33.240 --> 0:20:37.960 disparate organizations that all say they want to help the client, 0:20:38.320 --> 0:20:41.000 but they have a different tool kitten, maybe a different 0:20:41.800 --> 0:20:45.240 level of experience in doing that. What has been your 0:20:45.600 --> 0:20:49.239 your experience, Yeah, thank you, Bammy, it's a it's been 0:20:49.280 --> 0:20:51.399 a fun and interesting right over the last few years. 0:20:51.400 --> 0:20:53.879 You know, we had the we had that kind of 0:20:53.960 --> 0:20:57.680 combination of perception and reality in the world in terms 0:20:57.680 --> 0:21:00.560 of uh, you know, a lot of the huge, larger 0:21:00.600 --> 0:21:03.439 firms are are perceived to be the best firms and 0:21:03.440 --> 0:21:06.200 and what we really had, you know, uh, strength and 0:21:06.520 --> 0:21:09.400 being associated with Commonwealth Financial Network. You know, we had 0:21:09.480 --> 0:21:11.760 a group of advisors that were really considered to be 0:21:11.920 --> 0:21:15.399 some of the best advisors in the marketplace, and uh 0:21:15.840 --> 0:21:18.639 it really wanted to bring a consolidated firm together so 0:21:18.680 --> 0:21:21.280 that we could you know, make each other better. Uh, 0:21:21.440 --> 0:21:23.480 you know, battle some of those perceptions in the world 0:21:23.480 --> 0:21:27.240 that if you just don't have umpteen billion dollars under management, 0:21:27.280 --> 0:21:29.959 you're just not a good firm. So uh so, how 0:21:30.040 --> 0:21:32.800 much consolidation. Have you seen over the past few years, 0:21:32.800 --> 0:21:35.239 I mean, has it been accelerating? Well, Kansas City has 0:21:35.280 --> 0:21:36.920 been kind of a hotbed for that. I mean, the 0:21:37.200 --> 0:21:40.560 vast majority of the big firms are mostly doing it 0:21:40.560 --> 0:21:45.240 through acquisition, acquiring other practices. Trying to get bigger um 0:21:45.320 --> 0:21:47.639 ours was not a story of acquisition, but more of 0:21:47.640 --> 0:21:50.600 a story of just merger, merging practices together so that 0:21:50.640 --> 0:21:54.119 we could uh make each other better, take advantage of 0:21:54.880 --> 0:21:58.760 talent and specialized areas of planning. But it's it's an 0:21:58.760 --> 0:22:00.840 absolute trend. You go across the country and talk to 0:22:00.880 --> 0:22:03.720 other advisors that everywhere people are talking about some form 0:22:03.800 --> 0:22:06.879 of Have you ever seen faster rates of consolidation in 0:22:06.880 --> 0:22:10.520 the industry, I haven't, No, I mean it's it's very 0:22:10.600 --> 0:22:14.600 very prevalent in the Midwest for sure. What kinds of 0:22:14.760 --> 0:22:18.800 back office issues do you face most when you try 0:22:18.840 --> 0:22:22.040 to combine different practices, Well, there's there's always a battle 0:22:22.040 --> 0:22:24.600 of culture, you know. We uh part of the reason 0:22:24.720 --> 0:22:27.840 is to be better for your clients, but you also 0:22:27.880 --> 0:22:29.720 want to make an environment it's better for your team. 0:22:29.840 --> 0:22:32.960 You know, we have a tremendous staff and and team 0:22:33.000 --> 0:22:36.440 in Kansas City and and working together has been of 0:22:36.560 --> 0:22:41.840 benefit to them as well. So culture is a big challenge. Um, 0:22:41.880 --> 0:22:45.320 you know, we're we're all very successful financial advisors, so 0:22:45.480 --> 0:22:48.560 you know, getting everybody to be on one page in 0:22:48.640 --> 0:22:50.359 terms of a team vision, in terms of what we 0:22:50.400 --> 0:22:52.200 want to accomplish for our clients, what we want to 0:22:52.200 --> 0:22:54.359 accomplish them. I have a if I have a room 0:22:54.359 --> 0:22:57.640 where they're just where you realize there's either not enough 0:22:57.680 --> 0:23:01.360 oxygen or there are too many heads in the room. Now, 0:23:01.400 --> 0:23:04.680 you know, I perceived that that could exist, and I 0:23:05.040 --> 0:23:06.960 know the room that we have there in Kansas City. 0:23:07.000 --> 0:23:10.000 But it's often, uh more a story of just people 0:23:10.080 --> 0:23:13.600 looking for that greater good, uh you know, greater good 0:23:13.640 --> 0:23:15.600 for one another for their own practice be as well 0:23:15.640 --> 0:23:17.560 for their clients. So we've had a really good go 0:23:17.680 --> 0:23:21.479 of it. So how much is the consolidation just joining 0:23:21.480 --> 0:23:26.679 forces and sort of providing uh you know, counterpoints for 0:23:26.720 --> 0:23:29.399 one another in terms of skills and assets. And how 0:23:29.480 --> 0:23:32.960 much is trying to gain economies of scale and then 0:23:33.200 --> 0:23:37.320 downsizing in certain areas. Yeah, absolutely, there's all. There Absolutely 0:23:37.400 --> 0:23:40.240 was the reality of economy of scale, you know, looking 0:23:40.240 --> 0:23:42.760 at the numbers and saying, look, we're we're in a 0:23:42.760 --> 0:23:44.600 as Matt had said before. You know, we're in a 0:23:44.640 --> 0:23:47.680 fee consolidation type industry. We want to have reasonable fees 0:23:47.720 --> 0:23:51.719 for our clients. Everybody's much more aware of of fees, 0:23:51.880 --> 0:23:53.359 you know, whether it be through d O L or 0:23:53.400 --> 0:23:56.080