10/6/25 From Woolworth's Windows: Hard Rock Hype, Rite Aid's Fall & Real Fiduciaries

The Moneywise Radio Show and Podcast Monday, October 6th BE MONEYWISE. Moneywise Wealth Management I "The Moneywise Guys" podcast call: 661-847-1000 text in anytime: 661-396-1000 website: www. MoneywiseGuys.com facebook: Moneywise_Wealth_Management LinkedIn: Moneywise_Wealth_Management

• 0:00Speaker 00

  From the second floor of the historic Woolworths Building in downtown Bakersfield, here is Money Wise. Call or text into the show 661-396-1000.

• 0:10Speaker 01

  I need a dollar, dollar, dollar, that's what I need. Hey, hey. Well, I need a dollar, dollar, dollar, that's what I need. Hey, hey. Said I need a dollar, dollar, dollar, that's what I need. And if I share with you my story, would you share your dollar with me?

• 0:30Speaker 02

  Securities offered through LPL Financial, member FINRA/SIPC. Investment advisory services offered through LPL Financial. LPL Financial and Money Wise Wealth Management are independently owned and operated.

• 0:40Speaker 00

  Here is Money Wise.

• 0:42Speaker 03

  Second floor of the historic Woolworths Building downtown on ESPN Bakersfield, 12:30 a.m., 101.1 FM, and always streaming at MoneyWiseGuys.com. You can call or text into the show 24 hours a day at 661-396-1000. Today, we're your hosts. I'm Sharad Waite and... Sammy Abiyawi. Hey Sammy, I can't hear you except for maybe just through the walls. I get a faint, I get a faint voice through the hall, but I can't hear you through my headphones. Either way, we're going to get started here. Want to remind our listeners again, you can call

• 1:23Speaker 03

  or text into the show 24 hours a day at 661-396-1000. I'm Sharad Waite. I'm here with Sammy Abiyawi. This is a big deal for us. We actually spent the weekend moving our offices from our longtime location across the street from Cal State Bakersfield on Stockton Highway, and we are now officially doing business from our new headquarters on the second floor of the historic Woolworths Building in downtown Bakersfield on the corner of 19th and K. Couldn't be more excited to be here. Well, as we get the, working through some of our technical

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  glitches here, I thought a good way to start the show out would be to go ahead and answer some listener questions.

• 2:15Speaker 03

  So I'll go ahead and read that and get started here. First question we have from a listener, it says, what should families and retirees do to prepare if this shutdown lasts a while? Two weeks is pretty long for us. So first of all, thank you, listener, for chiming in and sending in your question. You know, I have to just assume that you are potentially a federal employee, which is why you're, you know, asking this question concerned about the impact that this could have on your family. I know outside of, you know, being an employee or a federal,

• 2:57Speaker 03

  how this shutdown is going to affect, you know, us who are not government employees. You know, the, the, you know, one of the, this happened to me actually years ago. When we bought our first house and we were using, I believe it was, it must have been an FHA loan, but it, you know, we couldn't close, essentially, we couldn't close escrow on our home because of the government shutdown that was happening at that time. So people certainly right now, if you're using a government backed loan, I'm assuming if you've got an SBA loan or other, other government,

• 3:39Speaker 03

  federal backed government loans, it could be difficult. This is gonna, this is could be a delay. And who knows how long this is going to last? Government shutdowns historically have not lasted very long. In fact, if you go back into the 1970s, we had oh, almost 10 different government shutdowns between 1976 and 1996. And the vast majority of those shutdowns lasted one to three days. However, we did have a very long

• 4:21Speaker 03

  Government shutdown. In fact, the longest government shutdown we've had in US history took place from 2018 into 2019, lasted 35 days. This was under President Trump's first administration. And that was a 35 day shutdown. A lot of the reasons behind the political shutdown then in the 2018, 2019 was over the border wall funding. Now, the shutdown that we're experiencing now, Congress is arguing over what appears to be largely healthcare

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  funding. And so it's very difficult to know exactly how long this shutdown might last. This is really comes down to if you think of it in just terms of financial planning and financial advice, something that Money Wise has been adamant about for many, many years. And that is making sure that your family has an emergency savings. And that's money that's built up, that's put away in the bank, in a savings account, that will be there in the event that there is an emergency or disruption in your employment like we might be experiencing now. Of course, if you're in that situation now, doesn't help you if you don't have an

• 5:42Speaker 03

  emergency savings. So now what it's going to do, I'm afraid for those employees or those people who are dependent on the federal government being open for their paycheck, once you deplete your savings, it becomes very, very difficult. We saw this in the last major shutdown, where we had federal workers who were, you know, looking to government programs to help them, you know, get food and to, you know, to get by. So the hope is that this doesn't, this doesn't last that long. The hope is that, you know, we see some reprieve and that, you know, we get some help from our government to make some

• 6:23Speaker 03

  decisions and get the, get things opening up again. We're going to do this now. I've got another question here from a listener. I want to remind our listeners, if you have any questions, text them, send them our way, 661-396-1000. In the meantime, we're going to take a quick break. We'll come back, we're going to answer more questions. And welcome back to the Money Wise Show. I'm Sharad Waite. We're your hosts today along with Sammy Abiawi. Hey Sammy.

• 6:47Speaker 04

  Hey, can you hear me now?

• 6:48Speaker 03

  I can hear you. We're here. We're in.

• 6:52Speaker 04

  We're almost, I feel like we're almost back 20 years in that old Verizon. Can you hear me now?

• 6:58Speaker 03

  I think I know what the problem was. I'm here. I'm back. Can you hear me now?

• 7:02Speaker 04

  Yes, I can, sir.

• 7:03Speaker 03

  That mic button is sensitive. Sorry about that. I don't know how much was caught there. We're live. Of course, we're working out some of the kinks here in our new offices, our new temporary studio here in the historic Woolworths Building downtown Bakersfield, the corner 19th and K. I'm Sharad Waite here with Sammy. Hey Sammy, do you have access to the questions? Can you see the listener question?

• 7:27Speaker 04

  I do not, but if you read it, I might be able to answer.

• 7:31Speaker 03

  You'll definitely have the answer. We can work on this together and I'll go ahead and read it. Here it is. It says, "I am sure you get this a lot, but does it really? What does it really mean when an advisor calls themselves a fiduciary? Are not all advisors fiduciaries?" So this is a great question.

• 7:49Speaker 04

  Very good question.

• 7:51Speaker 03

  It could be confusing. It's kind of hard to, you know, parse through some of these, you know, words. Fiduciary is a big word. Don't expect everybody to understand what that means, but really in simple terms, a fiduciary, what they're really saying is that they're legally and ethically required to put your best interest first, even above their own compensation. It has to be above their own sales quota or, you know, the firm's bottom line. When a fiduciary or an advisor calls themselves a fiduciary, that's what they're saying. They're saying that they are legally and ethically required to put your interests above everything else.

• 8:31Speaker 03

  That means they've got to avoid any of those conflicts of interest, or at least if there are, those conflicts need to be disclosed fully. And it's also important to know that not all advisors are fiduciaries. And, you know, without getting too much into the weeds, a registered investment advisor or an investment advisor representative.

• 8:55Speaker 03

  Of a registered investment advisor are generally, those are fiduciaries. And under the law and under the Investment Advisor Act, they are fiduciaries. Now, if they are broker dealer representatives, so that's what we used to call back in the day, a stockbroker, they're held to a different standard. And that standard is called a suitability standard. That means their advice just needs to be suitable. Doesn't necessarily mean it has to be the best for you. It just needs to be suitable for you. Now, some advisors wear both hats, which means they're duly registered. That means they have to act as a fiduciary when they're giving financial planning

• 9:40Speaker 03

  or financial advice, but they can switch to that lower suitability standard when they're selling brokerage products. So if they're selling you some sort of, you know, oftentimes what you're sold is a life insurance product, it can be annuity or a variable annuity. Those are generally under the brokerage arm and that advisor that is just needing to make sure that the standard that they keep is that it's just suitable for you. Which, you know, I don't know, Sammy, it's a pretty big difference. And it's really confusing, I think, for most.

• 10:17Speaker 04

  Yeah.

• 10:18Speaker 03

  It can be confusing for advisors to kind of, you know, parse through it. But for consumers, it can be confusing.

• 10:23Speaker 04

  I have a follow-up question now, now that you identified fiduciary. Now, a lot of the financial advisors have to go through a licensing process. And the licenses are multiple types of licenses. Does that fiduciary level change with the licensing that you get?

• 10:41Speaker 03

  Yeah, I'm glad you brought that up, Sammy. So licenses and registrations that put somebody that's under a fiduciary duty is either the Series 65 or a Series 66. Sometimes people have a Series 66 that's paired with the Series 7. But generally speaking, if you, if your advisor has a Series 65 or a Series 66, then they would be working under the fiduciary, working as a fiduciary under that Investment Advisor Act. So it is one way, I think, that people, if they wanted to do some research, brokercheck.org, I think it's .org, not .com, right?

• 11:23Speaker 03

  BrokerCheck online is the public source for people to be able to research your investment advisor or your financial advisor. And there's where you have disclosures, if there's been any disciplinary action. You can also see what licenses they're held.

• 11:43Speaker 04

  Yeah. So it's brokercheck.finra.org.

• 11:48Speaker 03

  Ah, there you go.

• 11:50Speaker 04

  And I was gonna, I have another follow-up question.

• 11:52Speaker 03

  Yes.

• 11:52Speaker 04

  Now, a lot of the financial advisors have multiple three-letter things after their name. One of them is CFP, Certified Financial Planner.

• 12:04Speaker 03

  Yes.

• 12:04Speaker 04

  To my knowledge, that's a higher than just having a Series 65, or 6, or 7. And it gives you, it gives whomever clients a little bit more, is it trust into the person that's giving them that advice? Because they went like a couple more years of licensing. Is that correct, Sher?

• 12:24Speaker 03

  Yeah, that's, that's correct. So a CFP designation is like a CFP, which is a Certified Financial Planner. They all have a code of ethics that require a fiduciary duty. So when they're delivering financial advice and you're a CFP, sort of obligated to keep that higher standard of, as a fiduciary. You know, these are voluntary standards. They're not the same thing as being legally bound by the SEC, or by FINRA, or by a state regulator. But there are, I mean, there, there's a code of ethics there for CFPs. And some of the other acronym, not acronym, but letters that you'll find after an advisor's name is CFA.

• 13:04Speaker 03

  That's a Chartered Financial Analyst, or a Chartered Financial Consultant, a CHFC. These all have code of ethics that require a fiduciary duty. But, you know, the easiest way to know whether or not your financial advisor's fiduciary is, is to, I think, look at BrokerCheck, brokercheck.finra.org.

• 13:28Speaker 03

  Series seven, six, sixty-three, and twenty-four, these are broker-dealers licenses. These put the, again, these put the advisor into suitability standard, not that higher fiduciary standard. It means that they're, you know, in, in, in, in practice, they can recommend something that's just good enough. Even if there's a better or a cheaper option, if they're not, if, if the advisor's not working under that fiduciary standard, it, it, it, you know, it just, it just means that they can, they can offer something that's basically just good enough. And this is, this is something, you know, at least at money-wise, we've held ourselves to that higher standard. All of our advisors are fiduciaries.

• 14:11Speaker 03

  All of our advisors have that licensing that requires them to put the, the, the, the public's interest before their own. And that's where you will find fee-based, the fee-based relationships or fee-based financial advisors, they're, they're all under that fiduciary standard. So, you know, there's a lot of acronyms and a lot of numbers there. I, I can't tell you, Sammy, how, how kind of heartbreaking it is sometimes when we run into somebody who's been working with, with who they thought was a financial advisor. Yes. And then it just turns out it's a, you know, it's, it's somebody who is putting themselves out there as a financial advisor, but really, they're just, they're just, you know, selling insurance. Insurance.

• 14:56Speaker 03

  Insurance products or, or whatever. And, you know, it, it's tough because for, you know, to be a fee-based advisor, generally what you have are minimums and a minimum asset levels or minimum requirements of what somebody needs to have to be able to invest because it, it just, it just requires usually a substantial amount of money for the advisor and the investment advisor representative to really be able to recommend appropriate portfolios and investment solutions. And, and so there, I, I can see an argument for a need for that, that traditional stockbroker

• 15:37Speaker 03

  relationship, that, that suitability, or just that straight broker, financial advisor relationship. Because for somebody who can't meet the minimum, you, you, you may not have any other choice but to go with, you know, a loaded mutual fund or, or, you know, a commission-based.

• 15:57Speaker 03

  Solution and oftentimes, you know, that, that, that's their only option. So yeah, good question. Keep them coming our way. 661-396-1000 is the phone number that you can call or text. If you, if you do send in a message, you are going to be aired on a historic day for Money Wise. This is a big deal. Steven, good job, man. You've done, done a great job getting this all going. Oh, I can't hear you.

• 16:32Speaker 04

  Cause I can see you. He's muted, I think on purpose.

• 16:35Speaker 03

  Yeah.

• 16:36Speaker 04

  But Steven has done a very good job setting this up in a makeshift, a radio room in our respective offices. Oh, here he is.

• 16:45Speaker 03

  Oh, there he is.

• 16:46Speaker 04

  I think he was quiet because he's losing in fantasy football to me.

• 16:49Speaker 00

  Fantasy football, you know, my real football team, it's all downhill, but positive. We're in the Woolworth Building, so I, I cannot complain, but we did get a, speaking of historic, we, we got a message said, so is the historic Woolworth Building open now? Glad to hear you guys back on the radio.

• 17:12Speaker 03

  Thanks for tuning in and thanks for listening. So Money Wise is open. We're open for business and we're rocking and rolling. We're here. And we are up on the second floor of the Woolworth. We also have some space on the first floor. So these are temporary reception area and a temporary conference room and some meeting rooms down on the first floor, the main floor of the Woolworth Building. So, so Money Wise is open for business. Now, the restaurant, the luncheonette, historic luncheonette is not open yet for the public. We have soft opening happening this week and the hope, I think the goal is Saturday. Is that correct, Sammy?

• 17:49Speaker 04

  That is correct. So we're going to try to do at least a soft opening with some invite only for people to come in and give us feedback for the next four days starting from Tuesday. Limited hours. We're trying to serve at least 100. About hundred people, but hopefully Saturday will will will will open the doors. Definitely will let the public know through all the social media. We've got a lot of feedback through social media. The first time we posted about the grand opening that's happening actually on October twenty fifth of this month. I think Emily told me we have a hundred twenty five or hundred thirty thousand views of that post,

• 18:33Speaker 04

  which is an amazing, amazing number. So the the support that we're getting and the love that we're getting, people come in and checking the doors. Are you guys open? Are you guys open? It's it's heartwarming, great support for us all together, both money wise as well as the historic Woolworths. A little bit more patience with us as we are working out the kinks of the restaurants. So we can give you the best the best experience possible when you walk through those doors. Uh, if you have a childhood memory, we want to duplicate that when you come in either with the milkshake or the fries, the burger, whatever that is, we want to make sure that that experience, that first experience is an amazing experience for you and your family. So we'll definitely let the public know if if Saturday is the day.

• 19:19Speaker 03

  Yeah, we're we're, you know, this is, opening up a restaurant is not for sissies. It's there's a lot. I mean, our team is amazing. It's not, you know, Sammy and I and Emily that are just doing this. Richard Yoshimura, who is our executive chef from previous locations, is the kitchen and and Moo Creamery, the founder of, a co-founder of Moo Creamery. He's got a great pedigree. He's got a great menu. Of course, we are gonna have, we're we're keeping with the burgers, fries and shakes and that traditional menu that a lot of people are are known or remember with the Woolworths. So yeah, stay tuned. Hopefully this weekend it will have a, it will be open for the public.

• 20:01Speaker 03

  And then, of course, we we we're not, you know, the building is is still not fully occupied. We still have construction happening down in the basement. So unfortunately, until our elevator is completed, the basement won't be completed until December.

• 20:17Speaker 03

  And that that will be significant, especially for MoneyWise, because the basement's going to be held. It's where we're going to hold our our events, our client events, our our there's a stage and and space down there for us to be able to hold community events, not just for MoneyWise, but also for the entire public. So it's, you know, really a lot going on here at the building. And and of course, when the basement opens up, that's where we will reopen the Gero Ellis padded radio room down in the basement. In the meantime, we've got it. We've got it kind of, uh, let's see, we've got it figured out. I'll say that. We've got to figure out another another mode here using the MoneyWise offices and our laptops.

• 20:56Speaker 03

  So, good stuff. You know, before we take this quick break, Sammy, headlines, a lot of headlines today, one of them being Rite Aid. I'm sure you're familiar with this. I think we've talked about on the show that Rite Aid declared bankruptcy back in May of this year. It was, you know, very close to when they had when they had filed for bankruptcy. And in just not too long before May of this year, Rite Aid filed for Chapter 11 bankruptcy. And but what the headlines we're seeing today is that the the stores are all closing. So every single Rite Aid store is closing. That means it's an end of an era for Rite Aid. This is a company that started in

• 21:41Speaker 03

  in in 1962 at a Scranton, Pennsylvania. Scranton, that's where the office is, isn't it? So the office is headquartered, the the show, The Office, 1962. And it changed, it actually started out as Thrift D Discount Center and then rebranded and changed its name to Rite Aid in 1968. So about six years after opening, it went public in 1968. Had aggressive growth through the 70s and all the way up through the 90s. It was actually the number three, the third largest US pharmacy chain, right behind CBS and Walgreens, all the way up into the late 90s. Rite Aid, of course.

• 22:27Speaker 03

  Acquired regional chains during their growth. They owned at one point Payless, which I remember Payless very clearly. And of course, Thrifty, which, you know, I've remembered

• 22:39Speaker 04

  Ice cream.

• 22:40Speaker 03

  The ice cream. But, you know, they used to have Thrifty's stores. But the ice cream, which is actually still, was owned by Rite Aid. If you would, when Rite Aid was open, you could go into Rite Aid and see the Thrifty's ice cream place. I believe my understanding is that through this bankruptcy, Rite Aid is selling off its assets, including its, you know, its pharmacy list. And it's, you know.

• 23:05Speaker 04

  I just, I have a question. Do you think the two scoop for a dollar ninety nine may be the cost for the bankruptcy?

• 23:12Speaker 03

  Did they still keep it that low? I hadn't had Thrifty's ice cream in

• 23:15Speaker 04

  As of like, I haven't had it in a long time, but at least, at least six, eight years ago, I think two scoops were a buck ninety nine.

• 23:25Speaker 03

  And was it still that like, that scooper that was like a cylinder and it just like

• 23:29Speaker 04

  Yep, yep.

• 23:30Speaker 03

  Pushes it out?

• 23:31Speaker 04

  Yeah. Yeah, that's, that's, and it's not, not bad quality ice cream. You, I used to walk down from my old house with Gabe, just go get a scoop of ice cream from Rite Aid. And, and as a lot of real estate investors, by the way, used to consider Rite Aid as a AAA tenant.

• 23:53Speaker 04

  It used to be an anchor tenant for a lot of, a lot of people. Whenever they develop corners for commercial, Rite Aid was either an anchor tenant or a AAA tenant. So if you have a Rite Aid as a tenant, you're the value of whatever development you build from the ground up. As soon as that lease is signed, the multiple, the, the increases, the value of that building increases. And for, this is unfortunate, which we're seeing, very, very unfortunate.

• 24:22Speaker 03

  Yeah.

• 24:22Speaker 04

  Some really prime locations and prime corners, which I'm hoping we can repurpose here, at least here in Bakersfield, we can repurpose. So I'm hearing some noise about repurposing them to either other pharmacies. There are some, some, some local guys that have, that are running pharmacies that might be going to some of these locations, or sometimes gas stations are looking into this. Or repurposing them all together into dividing the space into making it a little

• 24:54Speaker 04

  What do you call those little malls, neighborhood malls?

• 24:57Speaker 03

  Oh, yeah. Yeah, I know like downtown, the Rite Aid, there are a lot of people would use that Rite Aid, you know, for, you know, to pick up things that they need. And I'm guessing that CVS or Walgreens is probably going to pick up some of their locations. Just because they got the drive in and, you know, those types of things they would want.

• 25:16Speaker 04

  If they're not in the same corner, like some of them that we have here in town, like at the corner of Huaybel and Panama, there is a Walgreens and there is a Rite Aid just across. But there are some neighborhoods, like where I used to live in the northwest, some Rite Aids that are like in the Olive Drive area and Jueta, that could be a good Walgreens or CVS even. So I'm hoping that they can repurpose these because the vacancies just brings a lot of bad things to a neighborhood.

• 25:46Speaker 03

  Yeah, yeah, with broken windows and boarded up walls. Walgreens peaked in the 90s and it was in 1999, they had a major accounting fraud scandal and they really never bounced back from that. It seemed like ever since that account, that major accounting fraud scandal in 99, just wrecked its balance sheet and from then on, it was always in turnaround mode. It was, you know, selling off divisions and closing stores. It was constantly refinancing its debt. And then, you know, from about 2015, 2017, it just really started to collapse.

• 26:26Speaker 03

  That was Walgreens actually tried to buy Rite Aid outright, but the regulators blocked it. And so Walgreens did pick up about 1,900 stores during that process, but ultimately that, you know, that hurt Rite Aid.

• 26:40Speaker 04

  Yep.

• 26:40Speaker 03

  And then it just continued to decline. It peaked at about 5,000 stores and in the early 2020s, it was down to about 2,000 stores. And then it filed bankruptcy in 2023. It came out of bankruptcy in 2024 and then filed again in May of this year. And now, you know, by October of this year. It's it's shut its last doors and now it's liquidating, get rid of all that stuff. So I agree with Sam. It's kind of sad, you know, into an era. You hate to see something like this happen for a company that's been around for over 50 years. Almost 63 years this company started, but it's, you know, it's a lesson learned. You either evolve or you die.

• 27:23Speaker 03

  And and when you're when you're working at that kind of scale and, you know, you it's just, you know, it's just too bad. Just too bad.

• 27:32Speaker 04

  It is.

• 27:33Speaker 03

  All right, let's do this. Take our next break of the day. We're Money Wise. Don't go anywhere. And welcome back to the Money Wise Show. We're your hosts today. I'm Sharad Wade, along with Sammy Abhiyawi. Thanks for tuning in. Thanks for sending in your messages, 661-396-1000. That's the number you can call or text 24 hours a day. We'll take your messages and comments, questions, keep them coming our way. Another message here, Sammy, says, Thrifty had the best black cherry ice cream. Didn't they buy Long's Drugs? Sad. Drove by my Rite Aid and it was Spirit Halloween store.

• 28:06Speaker 03

  Isn't that Spirit Halloween store? Like, what a weird business model, right? They just go into these like vacant buildings, right?

• 28:13Speaker 04

  It's a seasonal bill. I think it's very smart personally because you don't need to occupy the space year long. And and and you you take a big chunk of the billion dollar industry that's Halloween. When it's just a seasonal period, I think that's very, very smart from an occupancy standpoint.

• 28:33Speaker 03

  Yeah, yeah, it seems like it seems like a smart business model. Obviously, they're making money. That Spirit Halloween store comes back every year. And there's a bunch of them. They're all over town. I wonder how they I don't know how they accomplish the the like employing. I guess they're temporary employees, I guess, or they just use temp?

• 28:51Speaker 04

  I think they I think they call legacy staffing solutions and they might.

• 28:55Speaker 03

  Nice plug, Sammy. Nice plug. They get a temp agency legacy.

• 29:00Speaker 04

  Yeah, I think there's a lot of people that during during Halloween, a lot of moms, actually, their kids are back at school and and they just need to get out of the house. They go and work a couple of hours and then they collect a paycheck during this period and and then they move on.

• 29:17Speaker 03

  Yeah.

• 29:18Speaker 04

  Temp, temp employees.

• 29:22Speaker 03

  Right. Yeah. Yeah. And they're just, you know, I'm guessing a lot of people would enjoy just selling costumes for a few weeks. Be kind of fun. By the way, Rite Aid did not acquire Long's Drugs. In fact, but there was a relationship in 1999, Rite Aid sold 38 of its California stores to Long's Drug Stores. So Long's Drugs actually acquired some of Rite Aid stores in 1999. And in the 2000s, Rite Aid and Long's made an exchange deal where Rite Aid would acquire some of their Long's stores in the Northwest region of the country. And then Long's would

• 30:04Speaker 03

  take certain Rite Aid stores like in Nevada. So there was this kind of this weird relationship where they were exchanging stores, which is also a really fascinating story. I guess this, you know, pharmacies and chain pharmacies is fairly small group of companies, which I think that's, that was the issue with the regulators, why they wouldn't let CVS or Walgreens take on Rite Aid. Because I think they probably figured there was, it was going to minimize competition. You know, but part of what it did though is it, we, it naturally just killed the company. That's right. It couldn't hang around.

• 30:44Speaker 04

  And I think I had some clients that were independent pharmacists when I was a banker. And it was a very, it was lucrative business. And then Rite Aid comes in and just buys them out at a multiple. And that multiple was, was higher 10, 15 years ago, because they were just acquiring market share. So a lot of the pharmacists that I had as clients just either exited the industry altogether by selling to Rite Aid, or became an employee, a W2 employee of the, right after they sold their, their, their business.

• 31:18Speaker 03

  So you probably saw last week, Sammy, the news came out Hard Rock Casino Tahoma announced their grand opening set for November 13th. It's 150,000 square feet gaming floor that's going to open up on November 13th. It's going to have more than 2,000 slot machines, 50 live table games and exclusive VIP rooms for blackjack and baccarat. This is, what do you think of this, Sammy? I don't think you and I have really talked about the casino.

• 31:54Speaker 04

  We talked about the casino and the job creation that it's bringing, but never the actual casino and like what it's going to have, the amenities and just are people going to go? And in my opinion, I think people will go because, because instead of driving four hours to Vegas, you have something just down the street. If you just want to go and sit at a table and play a couple of games, a lot of my friends that gamble, if they don't want to go to Vegas, they end up going to Union Avenue to whatever that place it's called. And it's became like, I'm sorry, it's not the best place to be at. Now this is a brand new place. You said 50 tables, 2,000 machines.

• 32:39Speaker 04

  If you ever find me in a casino, that's where you're going to find me next to a machine. I'll probably spend $20 if I lose, I'm walking out.

• 32:46Speaker 03

  I'll save you some time, Sammy, you'll lose. Keep your money. Man, gambling, you know, it's, it's, you know, it's, it's, I don't have any problem with gambling if you're just doing it for fun.

• 33:03Speaker 04

  Correct.

• 33:04Speaker 03

  It's just where people start gambling more than they can really afford. This is similar, I mean, it's not as bad, the odds aren't as bad as the lottery. Yeah, but but the house does win. The house, the house generally is going to win. That's how they're paying the bills.

• 33:19Speaker 04

  That's, that's, that's, that is correct. That is correct. It's still, to me, sometimes what I, what I play is roulette. And, and, and I like the game of roulette. I don't, I don't know how to play any other games. It's either that or, you know, like I told you, the machines, I'm gonna, you know, spend 20 bucks, get, get that excitement out. And then guess what? Um, um, if I go to, ever to go to Vegas, I'm going there for the shows. I'm going there for the food. I'm going there for the shopping. Gambling is not my top priority when I go to these places.

• 33:49Speaker 03

  It would be fun at some point. Have we had anybody on the show, Stephen from Tahoma? Or from, we, I think we've tried to get Tahoma on, or at least the, not Tahoma, but the, uh, Hard Rock. It'd be fun. It'd be fun to get somebody on the, you know, on the, on the show, talk about, you know, who they expect. Are they, I'm guessing they're expecting not Bakersfield people. You know, with, with the lightning in the bottle, the, the music festival that came into town.

• 34:17Speaker 04

  Yeah.

• 34:17Speaker 03

  We've probably already talked about this on the show, but it, it brought in millions and millions of dollars of, of tax revenues into the county. But the attendees, it was like less than 5% were from Bakersfield or Kern County. I mean, these were all, these people were all from all over, all over the state.

• 34:36Speaker 04

  This is great, man. This is great. I mean, I, I missed it this year, but definitely next year I would like to go and just at least try it because

• 34:42Speaker 03

  Yeah.

• 34:43Speaker 04

  It's, it seems like you, Debbie, both, everybody that attended this thing told me that, uh, said that it was really, really fun and laid back.

• 34:52Speaker 03

  Blast. Oh, it's, it's, it's a blast.

• 34:54Speaker 00

  Let's go, Sammy. Let's go with you, Sammy.

• 34:59Speaker 04

  Yeah, let's go get some camping stuff and just go camp. Well, it's not just any dancing, Steven.

• 35:05Speaker 00

  Oh, I could dance.

• 35:06Speaker 04

  It's techno.

• 35:08Speaker 03

  Yeah, EDM. I mean, it's the real deal, but they use a lot of the, yeah. Boots and Cats. They use a lot of the sets from the Coachella music festival, which is massive, a huge music festival. The art installations are amazing.

• 35:25Speaker 04

  I wonder if Tom Maxwell went to this thing because he keeps talking about Coachella, but I don't know. I'm gonna ask him. I have to ask him if he ever attended this.

• 35:35Speaker 03

  I'm not, I'm not a huge fan of EDM and I, I, I only knew out of the hundred plus bands that were there, I recognized one or two of them. And, you know, they were, they were great, but it wasn't my style of music, but it was fun to just be in an environment in Kern County, especially at Lake Buena Vista, where you just have this crowd. You got a different, you know, just got a different vibe going and get to show off, get to show off our, our county to, to the state. It was, it was awesome.

• 36:03Speaker 04

  That's really cool.

• 36:04Speaker 03

  There was a big deal today, Sammy. I like, I love superlatives and there were a few superlatives today in the stock market. Of course, the first being that the S and P 500 and the NASDAQ both hit their all time highs. Just, just shocking to me. We're going through a government shutdown, federal government shutdown. Going into week two of that and markets just seem to be shrugging that off, you know, sometimes some, some shutdowns we've had in the past have had a, you know, pretty negative impact on the stock market. But this is, you know, pretty, pretty amazing to see all time highs now with the S and P 500 and the NASDAQ.

• 36:44Speaker 03

  But on top of that, there was the biggest and largest leveraged buyout where a company went from public to private in the history of the world. Have you heard of this, Sammy?

• 36:58Speaker 04

  No, tell me.

• 36:59Speaker 03

  EA Sports. EA Sports has been sold to a Saudi Arabian Public Investment Fund.

• 37:10Speaker 03

  And and other partners, including Jared Kushner's affinity partners and Silver Lake. These are our our private investment funds. It's a consortium essentially, but most of it going to the Saudi Arabian Public Investment Fund. Buying EA, taking it private for $55 billion. It's a $55 billion leveraged buyout. Now, the the reason it's leveraged is that about 20 billion of that money is is debt financing. So of that of that 55 billion, 20 billion is is debt. And what's happening is the shareholders are going to receive $210 a share in cash,

• 37:54Speaker 03

  which is about a 25, roughly 25% premium over its shares, what its shares were trading for publicly. But just what's fascinating is that you don't see a lot of these deals. Usually it's going public where you see these huge, you know, multi-billion dollar deals. But to see a company go go private from public and a company that's pretty pretty well known, EA Sports or EA is

• 38:25Speaker 04

  That's the, no, I'm not a, I'm not a gamer, but I'm, my son is and he plays. This is the gaming, correct?

• 38:33Speaker 03

  Yes. Yeah. Big games. It's one, it's one of the larger gaming companies.

• 38:38Speaker 04

  So I I know this just because I see the bill on my monthly stuff. That's what I pay for. So 55, $55 billion, the Saudi Public Fund is part of this. And Jared Kushner put the deal together, probably.

• 38:53Speaker 03

  Yeah.

• 38:54Speaker 04

  With with with both some hedge funds from the US and of course, the Saudi Fund.

• 39:00Speaker 03

  Yeah. Yep.

• 39:01Speaker 04

  So I'm I'm curious, what the, what's the impact for for for the players? What's is, I mean, when things go from public to private, typically you'll always see some type of an adjustment to the monthly fee or something so they can start recouping. Their their investments.

• 39:19Speaker 03

  Right.

• 39:20Speaker 04

  Isn't that correct, Sher?

• 39:21Speaker 03

  Yeah, it it it's really interesting. I mean, these these types of mergers and acquisitions or buyouts are very, very complex. You've got, you know, big money involved, a lot of players involved. But, you know, this really, I think, shows to investors, or at least makes them believe that these big game franchises, some of these big game franchises can be goldmine. And, you know, even though the rest of the gaming industry can be very, very volatile, this, you know, this is, this is something that certainly Saudi Arabia has been trying to diversify their their

• 39:54Speaker 04

  Definitely. Yes.

• 39:56Speaker 03

  Yeah, their economy, they're trying, you know, it's predominantly oil and gas. And the writing's on the wall globally for the the long term future of of carbon, carbon fuels.

• 40:06Speaker 04

  They're investing heavily in in other industries that are not oil, and this is probably one of them. And and and entertainment is huge. I mean, people now, especially after COVID, people staying home and and stuff. And frankly, countries like Saudi Arabia, which has a growing population, the whole Middle East, because of that weather they have, a lot of the time, you they're home, the kids are home, playing things at home.

• 40:31Speaker 03

  Yeah.

• 40:32Speaker 04

  It's it's it makes sense in my mind that they're invested in this.

• 40:37Speaker 03

  You know, EA, EA has not just sports. They they own, you know, the Madden NFL, they own NHL, NBA Live, they own college football. They also have first person shooter, like shooter in action, like Battlefield, which is that that was a game I used to play. Great game Battlefield, Medal of Honor. They also have racing games like Need for Speed and Burnout, the simulation and strategy games like The Sims, SimCity, Command and Conquer, that's classic, love, one of my favorite games. Star Wars, they own the, they own all the Star Wars titles and and lots of other notable games that EA has been involved in.

• 41:21Speaker 03

  But yeah, exactly right, Sammy. This is a way for Saudi Arabia to diversify its portfolio. They have the, you know, of course, the Gulf Live, right, in that Saudi Arabian.

• 41:32Speaker 04

  Yeah. And also now, I mean, if I don't know if you've you've heard or not, but their their soccer league. They're paying top dollars Ronaldo, for instance, that's a name you probably know, even though, even though Stephen does not know a lot about soccer, but he probably knows who Ronaldo is. He gets paid about 244 million dollars a year.

• 41:53Speaker 03

  For endorsements?

• 41:55Speaker 04

  No, that's about 180, 180 million dollars a year in, in just base salary plus endorsements, plus the plane, plus, so altogether, it's about 244 million dollars a year in, in comp package from the Saudis professional soccer league, which is bringing a lot of talent from Europe. It's competing with the big leagues in Europe and bringing in talent, paying top dollars for the players to come in. And, and they're having some success, like the, uh, the, the, I watch the games from time to time. It's good quality games. It's no longer that hot pot type of soccer. It's, it's, it's good quality games, good, good, um,

• 42:35Speaker 04

  coaches that are paying top dollars, uh, for the coaches to come from Italy, from Spain, from France, from England, from Germany. So they're definitely, definitely investing in things other than just oil.

• 42:49Speaker 00

  No, I, I was gonna bring up because they, you know, they recently got into, you know, wrestling, they've got into boxing, they just

• 42:56Speaker 04

  UFC?

• 42:57Speaker 00

  And UFC, I mean, they, they're definitely getting involved with all sports.

• 43:02Speaker 03

  Comedy? Now it's stand-up comedy, right?

• 43:05Speaker 00

  Big festival for two weeks.

• 43:08Speaker 04

  Yeah, there's a lot, a lot of comedians got some, some, uh, pushback about them attending that, but to me

• 43:13Speaker 00

  They just signed for a

• 43:14Speaker 04

  Hey, by the way, that was funny that they got pushback.

• 43:20Speaker 00

  I mean, wrestling, I mean, WrestleMania is like the Super Bowl of wrestling and they just signed a deal for 2027 where they're gonna have WrestleMania for two nights out in, uh, Saudi Arabia, so.

• 43:33Speaker 03

  Oh, really? It's weird to me that that's popular over there.

• 43:39Speaker 04

  Oh, it's huge.

• 43:39Speaker 03

  I mean, I guess.

• 43:40Speaker 04

  They love it.

• 43:41Speaker 03

  You just forget how much America exports across the world and just entertainment and culture. Like, you know, we're not the only ones that are interested in this kind of stuff, but we created a lot of it. I'm assuming that, you know.

• 43:58Speaker 04

  Yeah, the entertainment is definitely something that's American, in my opinion, and we do it, in my opinion, the best. And we're exporting it now, which is, which is good. The rest of the world gets to see what we have here and especially countries like Saudi Arabia, which have been closed for almost 50 or 60 years after the discovery of oil. And now they are, they are opening up big time.

• 44:24Speaker 03

  I know we, PG&E gets a lot of pushback and a lot of negative news, but you probably got the same email I got Sammy last week from PG&E that said that our electric rates are going down. I don't know if you saw that or got it.

• 44:38Speaker 04

  Yeah, I saw that and I've been looking at their commercials as well, commercials as well. I don't know if you've seen those.

• 44:44Speaker 03

  Yeah.

• 44:44Speaker 04

  They've had, they've, they put some commercials talking about, hey, we're not increasing the rates. In fact, we're going to hold them and next year we're gonna, we're expecting them to go down. So I think they're staying true to that.

• 44:56Speaker 03

  Yeah, that's what it says in the email. So I'm looking right at the email that I received last week from PG&E and saying that they've got good news. Starting September 1st, residential rates are going to go down by 2.1%. It says over the, over the past 15 months, residential electric rates have dropped three times and that they expect rates to go down again in 2026. So in addition to that, September, people are going for, for, actually, it looks like it's going to be received on our October bill, but residential electric customers are going to receive a California climate credit. I got mine, it's $58 or will get mine.

• 45:39Speaker 03

  And according to my email, I'm getting $58.23. I'm not sure what other people get or what that is. Based off of, but you know, this will be, this will be, I think, I mean, I'm skeptical of it just because we're so used to seeing rate increases. And if you look historically at PG&E's rates, they've essentially doubled over the last 10 years, which means it's had an average annual rate increase of about 7% a year over the last 10 years. And that is, I mean, just so many people, luckily, things are starting to cool down, but so many people are just struggling to just pay bills, you know, and, you know, get through

• 46:23Speaker 03

  this. And when you get a big PG&E bill, it can be heartbreaking. So hopefully there's good news for people out there. Hopefully we've turned the corner a little bit, at least, and some of these increases can stop. Just over the last three years, PG&E has increased their rate about 41%. So, you know, let's celebrate the wins, you know? That's right. When we get them and, and we'll take this as a win. Hopefully that continues to go in the right direction. Well, we did this. Good job, Stephen. You nailed it. I had no doubt. I had no doubt that this was going to work. All three of us here in separate rooms, separate parts of Bakersfield, but it's working out. We will be back tomorrow.

• 47:06Speaker 03

  You're not going to want us tomorrow. Oh, we won't be back tomorrow. That's right. Enjoy the playoffs tomorrow. And, and we will be back later in the week as we navigate through baseball playoffs. Of course, if you miss this show or any other shows, you can find us at MoneyWiseGuys.com. But in the meantime, remember these three things. Be smart, be safe, and always be money wise.

• 47:26Speaker 02

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