Pod Insights The Moneywise Guys 3/10/25 The Cost of Power: Rising Bills, Solar’s Future & Saving Struggles About this episode The Moneywise Radio Show and Podcast Monday, March 10th 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 instagram: MoneywiseWealthManagement Guest: Jack Darrah, Executive Management for Bland Company website: https://blandcompany.com/
Transcript 0:00 Speaker 00 From the padded radio room off Stockdale Highway, here is Money Wise. Call or text in at 661-396-1000.
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0:40 Speaker 00 Now, let's start the Money Wise Show.
0:43 Speaker 03 Welcome to the Money Wise Show. We are live from the Garo Ellis padded radio room off Stockdale Highway on ESPN Bakersfield, 1230 a.m., 101.1 FM, and always streaming at MoneyWiseGuys.com. You can text into the show 24 hours a day at 661-396-1000. Today, we're your hosts, Sharad Waite and?
1:02 Speaker 04 Sammy Abiyawi.
1:03 Speaker 03 Sammy Abiyawi. Happy Monday.
1:06 Speaker 04 Yes, thank you. Very excited to be here today.
1:08 Speaker 03 I'm excited to be here with you. We are going to be joined after this segment by Jack Dara. He's the executive manager at Bland Company. So, we're going to talk, you know, solar and business with him.
1:21 Speaker 04 Changes to the solar industry?
1:22 Speaker 03 Yeah.
1:23 Speaker 04 Things that happened last couple of years and how it's affecting that market and the industry overall.
1:28 Speaker 03 It's really changed the return on the investment of solar. And I spoke about this a few weeks ago, and I had a few people on the street go, "Hey, I heard you say, 'Don't get solar.'" And I was like, "Oh, well, I mean, well, maybe, but hold on."
1:43 Speaker 04 Yeah.
1:43 Speaker 03 So, we have an expert on. I wanted to have, I've been looking forward to having Jack on the show and really kind of break down solar, when it makes sense, when it doesn't make sense.
1:53 Speaker 04 That's right.
1:53 Speaker 03 Before we do that, though, we've got a couple of listener questions.
1:56 Speaker 04 Yeah, I'll go to the first one.
1:58 Speaker 03 Yes.
1:58 Speaker 04 Just got back to town, so still catching up on a few shows I missed. So, disregard if you have already talked about this, but regarding Newsom's executive order requiring state workers to return to office four days a week, wanted to see what potential economic effects?
2:14 Speaker 04 You may think this will have on small businesses near state offices that have been struggling since the pandemic reduced foot traffic.
2:22 Speaker 03 This is a really good question. I actually was unaware that this was the case, that we still had state workers that could work remotely. Like, you know, COVID changed a lot of things for good, but there's some lingering effects of COVID that I think it's easy for companies to get into, especially the bureaucratic government, to get into this rut of just, you know, working from home, for example, or working remotely. And, you know, across the board, it seems that most businesses have shifted back towards, at least the balance is more towards in-person. That's because there's so much more you can get done when you're, you know, you're in-person, you're in the hallways, you're, you know,
3:04 Speaker 03 you're around the water cooler. So that was my first thought was what, what the heck is this? You know, what, what, now, I can, I can see some government jobs where they could easily be done remotely. Okay, great. But, you know, the listener brings up a question, how would this impact economically those businesses that are especially around state offices? Well, I mean, obviously, it's going to benefit them.
3:27 Speaker 04 Definitely, yeah.
3:28 Speaker 03 It'd be huge.
3:29 Speaker 04 If you have, if you have a government building with, you know, 500-plus employees that coming in and showing up every day, and you own some type of a convenience store or a small sandwich shop, or just a, just a coffee shop, those individuals are going to want to either have breakfast, coffees, take breaks. So definitely, your foot traffic is going to increase, is going to have a huge economic impact on those small businesses.
3:53 Speaker 03 There's a couple of good examples of this. The Wall Street Journal reported when Washington DC had the federal mandate for employees to return back to offices, immediately rejuvenated the local economy. You know, you had thousands of people now, like you said, going out to, you know, get coffee or lunch or whatever. Another example, slightly different, but in the private sector in Seattle, there were, there's return of about 50,000 Amazon employees that when they made this similar mandate. On in person now, let's go. And that saw a huge boost to downtown Seattle, fifty thousand people.
4:31 Speaker 04 Yeah, because I think it's small businesses, but also landlords in this case. I mean, I can only think of in the private sector, if you're not occupying the office for a long period of time. Maybe you as a tenant might think, well, maybe I don't need it. Then all of a sudden, there is thousands and thousands of square foot available. Which affects the vacancy, which then affects the rate of return on investments. It affects how much the properties are worth. And you might end up with vacant properties smack downtown Seattle. Which would not be acceptable in this case.
5:06 Speaker 03 You know, there are still cities that are really struggling from that. San Francisco is a good example. I don't remember what the latest vacancy rate was, but man, that, that, because of the tech jobs and the nature of the downtown San Francisco, it really just decimated a lot of those commercial buildings. Which has a downward effect on even, you know, residential and other areas.
5:27 Speaker 04 I think, I think also the fact that, you know, we had, we had a problem, homeless problem, especially San Francisco, Seattle, and a lot of these workers did not really want to go back because it was just not.
5:38 Speaker 03 It's too sketchy.
5:39 Speaker 04 Too sketchy. So the fact, I mean, right in the city of California, we've removed a lot of these camps. Now going back to the office, there's no more excuse.
5:48 Speaker 03 Yeah, yeah. Well, good. Let's get, let's get the second message. You have it there?
5:52 Speaker 04 Yes, I do. Happy Monday. Figured this one would be a good topic. So with the potential for smaller refunds this year, what are some strategies to better manage cash flow and avoid financial strain during tax season?
6:04 Speaker 03 Gosh, I really like this. There, I've always had an issue with the, the way that a lot, I'm not saying that this listener does it, but a lot of people in America have intentionally a lot of their taxes withheld unnecessarily because they're looking for this windfall.
6:23 Speaker 04 Yeah, we've, we've talked about this briefly last week, Thursday, Dustin and I. And, and my banker mind just think, why am I lending my money at zero percent to the government? And then I'm going to get it back 12 months later to maybe do a big purchase or whatever.
6:37 Speaker 03 Yeah.
6:38 Speaker 04 Instead, let me change my lifestyle. And and just withhold withhold maybe less.
6:45 Speaker 03 Yeah, and then just put away the excess somewhere else.
6:49 Speaker 04 Somewhere else, a 4%, 3%, whatever.
6:51 Speaker 03 I I think it's it comes down to psychologically, people just get, you know, some satisfaction out of having this, what they view as like a bonus.
7:00 Speaker 04 I disagree with you. I think we have a problem.
7:02 Speaker 03 Yeah.
7:03 Speaker 04 We have a problem, a savings problem in this country.
7:05 Speaker 03 Well.
7:05 Speaker 04 We cannot for the life of us save money.
7:07 Speaker 03 There is a, there is also this, I can't remember, it just it just escaped me, but there's a bias, a human bias where we tend to be more more nervous about a negative impact than what the potential positive output. It's like a negativity bias. Which in this case, a lot of people just fear owing money to the IRS. And so they'll over withhold.
7:33 Speaker 04 That's right.
7:33 Speaker 03 But too much, rather than what what you and I would probably say is, well, that's why you have a savings account.
7:39 Speaker 04 That's right.
7:39 Speaker 03 So that you, if you happen to not have enough taxes withheld, well, you just pay it, just write a check, right? But half of America can't pay for a $400 emergency.
7:48 Speaker 04 That's because of our inability to save. Our culture does not allow us, does not teach us to save.
7:53 Speaker 03 That's right.
7:54 Speaker 04 You you, look, as a teenager, when you get your first job, what do you do? You get that little hundred dollar paycheck and you go straight to buying something. I'm gonna buy a game, I'm gonna buy this, I'm gonna buy that. But we don't teach our kids to save money.
8:09 Speaker 03 Yeah.
8:09 Speaker 04 And invest our money so you can have that compound in effect.
8:14 Speaker 03 Well, a parent that doesn't do it themselves, which half of America doesn't do it.
8:18 Speaker 04 That's right.
8:18 Speaker 03 And it's over half that lives paycheck to paycheck. I think they have a hard time telling their kids to do it. Because they're like, how am I gonna tell my kid to do this? I'm not doing it, you know? Even if it's unconscious, that's what they're thinking. But I mean, I I agree with you, Sam. I mean, something needs to change culturally.
8:34 Speaker 04 Yeah.
8:34 Speaker 03 You have to just, and I think it comes down to mostly just getting into that habit. You gotta change your habit, which sometimes takes a few weeks or a few months.
8:42 Speaker 04 Yeah.
8:42 Speaker 03 But you know, you're uncomfortable for a few months and nobody likes that.
8:45 Speaker 04 That's right.
8:45 Speaker 03 I mean, short attention spans.
8:47 Speaker 04 If you're buying four drinks a week or five drinks a week from Starbucks, buy three to start with. And the other two, just put them aside.
8:54 Speaker 03 Yeah.
8:55 Speaker 04 It's as simple as that.
8:56 Speaker 03 It comes down to automating, the biggest thing is automate it. Because that's why now, thank goodness, we have these laws that passed a few years ago that make force people to opt out of a 401k. Rather than the default is you're not a part of the 401k. Because now we have hundreds of thousands of people that are going to wake up and go, oh, what? I have, I have money in my 401k. Oh, yeah, I forgot I was even contributing to it. And I've seen this over and over in my career in counseling people about finance. Look, just put money in the 401k. I know it's going to cost you a hundred dollars a month to do it. Trust me, after a few months, you're not even going to think about it. You're going to go right back to how, wherever you were.
9:37 Speaker 04 Yeah, we, we, we have grown as a, as a, as a country towards not saving, but borrowing.
9:45 Speaker 03 Yeah.
9:45 Speaker 04 Borrowing a lot.
9:46 Speaker 03 Yeah.
9:46 Speaker 04 We borrow on everything.
9:47 Speaker 03 Yeah, or you have, you in there, in the back of our minds, we have this, this safety net. It's usually a credit card.
9:53 Speaker 04 That's right.
9:53 Speaker 03 Or a home equity line, a credit. And you're like, okay, well.
9:56 Speaker 04 But it's still leverage.
9:57 Speaker 03 Oh, yeah.
9:58 Speaker 04 Our, our safety net is leverage versus like what you said, a savings account. And again, it just stems from the fact that we encourage the ease of access to credit. Is, is what makes us this way. Like you go to other countries, even developed countries in Europe. You do not have an easy access to credit like we have here in the US. I always say this, if we compare ourselves to just France, for instance, which I have experience with. We're light years ahead when it comes to leverage and how you obtain leverage, how you get credit. Now, these countries are just getting to understanding, oh, man, we can, we can manipulate a little bit. Banks can, they're learning that from, from American banks. We can manipulate the consumer.
10:39 Speaker 03 Yeah.
10:39 Speaker 04 Through the ease of access to leverage.
10:42 Speaker 03 Yes, and the biggest leverage being the home usually for most people. We saw the great financial crisis of 2008, the great recession was in large part, people using their homes as an ATM. And that's just.
10:54 Speaker 04 Buying what? Buying toys.
10:55 Speaker 03 Yeah, yeah, exactly.
10:56 Speaker 04 Boats and jet skis and things like that.
10:59 Speaker 03 Crap.
10:59 Speaker 04 Just depreciate the minute you buy them.
11:02 Speaker 03 Well, let's, let's, we can give some advice, I think, to those in terms of your, your change in this, in your smaller tax refund this year. And looking forward into the next year, we always recommend that you adjust your 401k, your W4 withholdings, which you. You can do the IRS has a withholding estimator on IRS.gov. So you can make sure that the right amount is withheld. If you're one of those people that like that forced savings, well, then adjust it so that you get a little bit more of a refund. If you can't, you know, bring yourself to just set up an automated savings account somewhere. And I think that's a great idea, but the biggest thing is that having an emergency fund, three to six months worth of expenses will bring an enormous amount of relief to you, far greater than the relief of having
11:47 Speaker 03 access to a credit, a line of credit or a credit card.
11:52 Speaker 03 You know, you got, a lot of people get in trouble when they are self-employed because that means you're required to make those quarterly estimated tax payments, which is very, very difficult to do for a lot of people when you're cash, you're not cash flowing in your business. And then, you know, you get hit with this huge, with penalties and then a huge bill. So try, you know, you know, be, be disciplined in those, making those quarterly, quarterly estimated tax payments.
12:24 Speaker 04 Yes.
12:25 Speaker 03 Anything else there, Sammy?
12:28 Speaker 04 Just save, just, just like, I cannot stress enough how, how important it is to just save and just have a rainy day fund. For, for anything for that matter, not just for IRS, but just for, for, for anything.
12:41 Speaker 03 Well, yeah, yeah, good. Well said. You know, before we finish this segment, Sammy, we got to address the markets today. It has been for the NASDAQ, the worst decline we've seen in almost three years since we have to go back to September of 2022. That we've had the NASDAQ plunge now just, just over 4%. Dow sinking over about 900 points. And all major, all major indices are down. This is in large part due to the uncertainty coming out of Washington and President Trump. And, you know, I This is very difficult for us to talk about, for me personally to talk about on this
13:26 Speaker 03 show, because I've always taken the stand, and I still take the stand, that the president can affect the markets in the short term. In the long run, it's the free market economy that's going to prevail. But in the short term, I think it's so easy, whether you're for or against President Trump, it's really easy to point fingers. And this is an example where even Wall Street, I believe, can overreact. And I think it's important to remember that this isn't the first time that we've had a president come in and the markets have either been going down, or they go down after election. I want to give a couple of examples. So John F.
14:08 Speaker 03 Kennedy, when he was elected in November of 1960, the stock market started to have a decline. It later became known as the Kennedy slide of 1962. So between December of 1961 and June of 1962, the S&P 500 dropped, get this, almost 23%. What happened after was a substantial increase and recovery in the stock market. In the 60s even now, to this day, a lot of people will point back in their memory of how great, economically speaking, the 60s were. There were things that happened, obviously, that had an impact, like the Cuban Missile
14:48 Speaker 03 Crisis, the resolution of the Cuban Missile Crisis, that had an impact on it. But it's important to remember that these are short, the stock market is always going to have a period of corrections, or declines. And the economy is always going to have a recessionary period because of the nature of the business cycle. You have expansion and you have contraction. And so these periods can happen. I think we have to be careful that we point too many fingers at politics. Political risk is just one of the factors. A couple more examples here of... Elections and immediate after-election where we had a decline and a recovery is George W.
15:33 Speaker 03 Bush. Following his inauguration in January of 2001, the stock market had huge challenges. Of course, he was stepping into the mess of the dot-com bubble. But it wasn't, you know, that was easy. I remember even at that time, people pointing fingers at George W. Bush and go, "Look, the stock market is going down." It's like, "Well, you guys, like, I was in, I was in this business at that time." It was like, "This is so much more than just 9/11 and, and just, you know, President Bush." There's a lot of reasons why the stock market's going down. Of course, it's easy to point out what happened afterwards. The market began, markets began to recover in the mid-2000s and with the Dow and the S&P 500 both coming back and having decent recoveries.
16:15 Speaker 03 Even as, as recently as Barack Obama's term, when he took office in January of 2009, the stock market was in the midst of the Great Recession. The Dow Jones, the Dow Jones at that time, by the way, was at 6,500. It, it reached a low of about 6,500 in March of 2009. But after hitting that low, this is, here's March. Obama was in office for just about three months, less than three months, similar to President Trump today. But just after hitting its March 2009 low, the market went through this long recovery. The Dow surpassed 14,000 by 2013. And of course, we know where the Dow is now. Even with today's 900-point loss, we still see that, you know, the Dow had, you know,
17:00 Speaker 03 substantial gains since its low that we hit in 2009. So I, I think it's never, never count out the US economy and, which is represented in large part by the stock market.
17:14 Speaker 04 So you always say this, "Don't try to time the market," but...
17:18 Speaker 03 Time in the market.
17:19 Speaker 04 Time in the market.
17:20 Speaker 03 Yes. Yeah, that's it. Because over time, you can go back and look at any chart of the S&P 500 or the Dow, look at a 100-year chart, and you, you'll see what was at one point a huge drop or huge decline in the, in the, in the markets. Appear very quickly. Once you scan back and you look back over history, it's, it's a blip. And so, yeah, don't let, don't let
17:47 Speaker 04 Don't overreact.
17:48 Speaker 03 Don't overreact. Exactly. And don't let these, these things deter you from continuing to invest into, you know, the future, invest into long-term. If you're short-term, yes, you can't, you, you should not have short-term money in the stock market or in a stock or any like that, anything like that, because these cycles can last a period of years. They, you know,
18:12 Speaker 04 That's true.
18:13 Speaker 03 We went through this from, um, you know, with a few examples where it, you know, it could last a few years. And so, you know, if you're close to retirement, that's, and you need that money for income, you should be overweighted in fixed income, bonds, not in the stock market. And we've seen what's happened with bonds, at least last week, the bonds were, were doing pretty well. And even today, we saw rates go down, so bond prices going up. So people are making money in the safety and security of bonds, even in these uncertain times. So there you have it, Sammy.
18:48 Speaker 04 Yeah.
18:49 Speaker 03 We covered it. I want to take a break. Now we come back, we're going to be joined by our guest, Jack Dara. He is the executive manager at Bland. We'll be right back.
18:58 Speaker 00 Have you been putting off your finances? Seize the day. Call the Money Wise office at 661-847-1000, or email [email protected] for more information.
19:14 Speaker 03 Thanks for tuning in. We're Money Wise. I'm Sherrod Waite here with Sammy Abiyawie. We're joined now by our guest, Jack Dara. He is the executive manager for Bland Companies. This is a local company. It's been around for 40 years, right? Forty-plus years. Jack, thanks for coming on the show.
19:30 Speaker 05 Well, thanks for having me. I couldn't resist the opportunity.
19:33 Speaker 03 Well, we were pretending to be solar, uh, know about solar a few weeks ago. Uh, and I, I brought up right away, this was a few weeks ago, the fact that with Net Metering 3, this third version of how PG&E Charges us and charges homeowner residential for power. It didn't make it that it was harder to pencil out the benefits of solar.
20:00 Speaker 05 No doubt.
20:00 Speaker 03 So maybe you can, maybe you can help break this down for us. So what changed with net metering three?
20:06 Speaker 05 Well, solar is still very, very viable. Let me come right out and say that. The only difference really from previous years is it takes a little bit longer to collect your ROI.
20:16 Speaker 03 Yeah.
20:16 Speaker 05 It's still very viable if for no other reason than you're able to cap your costs if you purchase it. Because PG&E and SCE and the other utilities, they're going to continually be increasing the rates. So you just aren't able to get the payback like you used to, which was four to five years, maybe something like that. And M3 now it's probably closer to, to eight or nine, maybe even potentially here in the central valley. And the biggest problem we have here in the central valley compared to the rest of the state is we, we rely on our air conditioner so much.
20:50 Speaker 03 Right.
20:51 Speaker 05 If you lived near the coast, your payback could be a whole lot better and quicker.
20:56 Speaker 03 Oh, I see.
20:57 Speaker 05 Here in the valley for people with houses of, let's just say 2,500 to 3,500 square feet. You're going to need three to four batteries, probably to be able to help offset the, the energy rates of the PG&E. And when you combine that with the actual solar panels, it creates a much bigger purchase.
21:18 Speaker 03 And that had cost.
21:19 Speaker 05 And that had cost. It takes a while.
21:20 Speaker 03 I'm under net metering one. I got my solar, whatever 10 plus years ago. And so PG&E pays me back the full retail rate for over my overconsumption. Another way to put this is PG&E is my battery.
21:33 Speaker 05 That's correct.
21:34 Speaker 03 And they pay me what they charge for my power. So that's, you know, I've got an unbelievable deal. It's not going to last forever. I think it's a 15 year.
21:43 Speaker 05 20 years.
21:44 Speaker 03 20 years. So I've got, you know, less than 10 years there. I'm still going to do this. But essentially my understanding is PG&E was trying to force people into batteries. Because they didn't want to, they don't, no longer wanted to be the battery.
21:58 Speaker 05 Yeah. The, the problem that we have here in California, it's a, it's one that I'm not sure how they're going to fix. They're not going to build any more power plants. So people that have solar and then between solar and the care program, which is for the low income people, the people that don't have solar are basically having to pay to offset the lack of revenue that they're being, that are being produced for the people that have solar and care. So because of that, prices are going to continue to go up if you don't have solar. But unfortunately, being there's so many people with solar now, it's going to be difficult because they're going to start charging some, some sort of
22:39 Speaker 05 a surcharge or something on those people that have solar and those that don't have solar, just to be able to make up the loss of revenue for the people that do have solar.
22:48 Speaker 03 Yeah, it's, it does seem like California is in a bit of a mess. There, there's been some headlines about the, the, the amount of energy that's just being dumped or exported because of, at, at peak time.
23:02 Speaker 05 Correct.
23:02 Speaker 03 With, because of the, so much solar is out there. The, the batteries, the, I mean, economically, theory speaking, batteries should get cheaper. Are they, are we seeing that yet?
23:16 Speaker 05 Not yet, not yet. I've been hearing that myself, obviously for about two years now. I thought by now this year it would probably start to come down, has not yet. And, and one of the reasons is that the competitors who are making batteries now, it's tough to stay in business in this economic world that we live in, especially in California. And you're seeing them come and go, come and go, and come and go. So because of that, only the big boys are remaining. And so because of that, there's not as much competition as probably everyone would like to, to drop the battery price down. And so, because it's, it's very difficult to, to continue to cycle a 12-month business when six, seven months
24:01 Speaker 05 is when everyone's interested in buying something.
24:03 Speaker 03 Right.
24:04 Speaker 04 So on, on an average, you said 25 to 3500 square foot is, is typical in the state of California. And adding these battery costs, like on average, what's that cost look like?
24:15 Speaker 05 Dollar wise? Let's just keep it simple, $20,000, $16,000 to $20,000.
24:22 Speaker 03 For the batteries.
24:23 Speaker 04 In addition to just the panels, the work, the labor and all that.
24:27 Speaker 03 And do you see the panels, are they coming down or continue to come down in price?
24:33 Speaker 05 They have come down, I'll say reasonably significantly over the last couple of years. Again, the unfortunate thing was as solar was ramping up to its high levels over the last, let's say, five to seven years. A lot of the manufacturers were building manufacturing plants here in the United States on the assumption that we were going to continue to, you know, to move forward. Well, then what happened was solar kind of took a little bit of a dive the last couple of years and some of those manufacturing plants have closed. So there are still a few left. Those are the ones that we buy from. We buy from US-made companies only. But the competitive levels here in the United States have not been to the level that we probably would have because we have seen more
25:16 Speaker 05 investment money coming in if in fact solar was continuing to increase.
25:19 Speaker 03 Yeah, we just, Sammy, you were just mentioning, uh, doing a little research on the, on the panels. About a third of the panels are made in the US or manufactured here. Are they cheaper than i- imported panels?
25:32 Speaker 05 I mean, they're not cheaper, but they're, they're relatively the same. Now you can buy some quote below tier one panels out, they're out there. But at some point in time, a company like us, we find a good manufacturer that has a good product and good service and we stay with them. And now there's others that buy wherever the cheapest price of the day is. That's not how we operate, but you could find them if you're interested in looking for them.
25:57 Speaker 03 Yeah.
25:58 Speaker 04 So, so now going from M2 to M3 affected this industry tremendously. Cause a lot of these homeowners don't want to buy solar anymore because the rate of return is going to extend a couple more years. A lot of these small companies went out of business. I mean,
26:14 Speaker 05 An awful lot, small and large.
26:16 Speaker 04 Yeah, and I've seen our, our community, a lot of these smaller people in our community are just gone. And, and who's, I mean, you're, you're left, you're, you've been here for 40 years. Who else is, is, is around doing this?
26:31 Speaker 05 There's, uh, there's probably two or three like us, I would say, in the valley. Um, who have been around a while, have a reasonably good reputation, that kind of thing. What all, what hurt badly was five to 10 years back, SunPower was considered the, you know, the, uh, the Cadillac of, of, of solar, of the solar industry. Well, they went out of business.
26:57 Speaker 04 SunPower is a manufacturer.
26:58 Speaker 05 They are manufacturer, that's correct, but they also partnered with local dealers
27:03 Speaker 04 Right.
27:03 Speaker 05 to create opportunities for co-op advertising money, uh, discounts based on, uh, purchases, things like that. And all those SunPower dealers now have to go back to being a regular, everyday business. So it's going to remain to be seen how they can function without big, big daddy, uh, SunPower, uh, behind them. Uh, but there's only a few, I would say, we're definitely the oldest, but there's only a few that I would say, um, would be considered, uh, reputable, maybe is the right word?
27:33 Speaker 04 So, the, the NEM3 affects homeowners, like the batteries are required on homes.
27:38 Speaker 05 That's correct.
27:38 Speaker 04 That's not the case for commercial buildings.
27:41 Speaker 05 Well, commercial buildings, it's, it's, it's commercial's different in the fact that most commercial businesses are open eight to five. So you don't necessarily need batteries because you're using the solar that you produce throughout the day. Um, so you don't necessarily need batteries. If you have a 24-hour-a-day operation, different discussion, then batteries, uh, um, will come into play at that point. But most commercial businesses, regardless if they're large or small, are open from seven till six, let's say.
28:15 Speaker 04 Makes sense.
28:15 Speaker 05 And while the sun is out, so you're able to utilize the power that you produce.
28:19 Speaker 04 We're going to take a quick break, we're joined
28:20 Speaker 03 Right now by Jack Dara. He is the executive manager for Bland Company. We've got a few more questions for you about solar and other projects that you're working on. We're Money Wise. We'll be right back.
28:30 Speaker 00 Money Wise Wealth Management is the only locally owned independent firm that uses a comprehensive wealth, tax, and estate approach, working closely with a highly trusted CPA and attorney. For information on how Money Wise can help you invest and plan for your future, call 661-847-1000. That's 661-847-1000.
29:05 Speaker 03 We're Money Wise. Thanks for tuning in. We're your hosts, Sharon and Sammy. We're joined today by Jack Dara. He is executive manager for Bland Company, a longtime local solar, not just solar, they do several things. So we were talking off the break how, how much of these solar companies have been devastated by the new net metering, PG&E's rules. So maybe explain or repeat again, what, how has Bland been able to navigate through these changes?
29:38 Speaker 05 It hasn't been fun. I'll be truthful. We were, you know, a significant, significant company in the valley here in what we do for the last 10, 12, 15 years. And NEM3 devastated us as well. Our, our sales levels are down tremendously and we've had to adjust accordingly on a cost basis. We were 110 employees for the last, I don't know, five years or so. And now we're down to I think 40, 50 employees. We're down nearly half. And it devastated us just like everybody else. No one was immune to what has happened over the last two years with net metering three.
30:22 Speaker 03 Wow. There, there is also some, something that seems a little unique that it's not just solar that the company relies on, right?
30:30 Speaker 05 Yes, we have roofing and HVAC and our kind of, you know, claim to fame is we take care of everything above the roof, above roof line. And they integrate so closely. A lot of people don't really think the fact that when I get my utility bill, oh my gosh, I gotta get solar. Well, truthfully, what we try to do is provide a whole entire energy management system, which truthfully, the first thing that everyone should look at here in the valley, depending on the age of your home, is how's my air conditioner?
31:02 Speaker 03 Yeah.
31:03 Speaker 05 Is it 25, 30 years old and very, very inefficient? Being the fact that it's being used 24 hours a day, seven, eight, nine months a year? That's a place that we need to look at first, before we decide to size the solar for your place. Let's figure that part out, then we can size the solar accordingly. Instead of doing it the other way around, which doesn't make sense otherwise, because if you do that, you'll be spending more money on your solar than maybe you necessarily needed if your new, if your air conditioner was sized correctly with a brand new air conditioner.
31:33 Speaker 03 Has there been any major innovations in air conditioning in the last five years or so?
31:39 Speaker 05 The efficiencies are just amazing now. Unfortunately, it's also been one of the categories that the inflation hit hard. We're probably up 40% on a cost basis in the last three years.
31:54 Speaker 03 Wow.
31:54 Speaker 05 Yeah, it's pretty significant.
31:56 Speaker 04 You're talking about the units?
31:58 Speaker 05 The units themselves, yes. They've just gone up so much. Truthfully, the inflation has hurt us really badly, or hurt the industry on the roofing side and the HVAC side, in terms of cost. On the solar side, it's not the cost that's a problem, it's the revenue side.
32:15 Speaker 03 Right.
32:15 Speaker 05 So, we just had to adjust accordingly and downsize our business to the level that, you know, we need to be at to handle service, handle our customers, and do a good job with the customers that we have.
32:27 Speaker 03 Has there been any impact from tariffs, or is there a concern about that?
32:32 Speaker 05 Now, no, because we are buying so much domestically, there is not a problem like there was in... 2000 and maybe was it 1918 where just about everything that was solar came from China. And that was a real problem for a while. But now that so many companies have put together manufacturing facilities here in the United States, we're just focusing on them so the tariff does not affect us.
33:00 Speaker 03 Yeah.
33:00 Speaker 04 I was, I was reading earlier, shared a lot of the countries that we import from are Thailand and Cambodia and Singapore.
33:08 Speaker 05 Vietnam.
33:08 Speaker 04 Vietnam, but a lot of them are Chinese manufacturers with plants in these countries so they can avoid tariffs.
33:15 Speaker 05 That's correct.
33:16 Speaker 03 We got a listener message here, let get your comment, Jack. It says, I recently got some quotes from a few local solar companies and it is surprising how cutthroat some of these businesses are. They'll sit there and bash each other and I'm glad to know that there's still a few good people left in the solar business and I, and I will see bland, I see bland as straight up with us. I mean, that's important for a local business, right? Your reputation.
33:41 Speaker 05 No doubt about it. We, we rely on it, we emphasize it and you know, my motto is no customer of ours will ever be dissatisfied. Now, they may have not got a great installation or whatever and they're angry or they're upset or we, we drove over their flowers or whatever it is, but we will always do whatever we can to walk out of there with a handshake and say, our bad, what can I do to make it right? And we never leave customers hanging. We have reviews that are second to none and anybody in our company follows that mantra. We do the best we can. Now, we're not perfect.
34:22 Speaker 04 I've experienced that in my own, my own right when, when they came to.
34:26 Speaker 03 They ran over your flowers?
34:27 Speaker 04 No, they fixed, well, I asked Jack to, to put some AC units in my garage.
34:33 Speaker 03 Oh, yeah.
34:34 Speaker 04 Just like, hey, what do you want this, what do you want that? I want you to be very satisfied. I'm not going to walk away from here until you're satisfied. Now, you're, you're paying a lot of whatever the company has earned and got throughout the years to this community through a program that you have.
34:48 Speaker 05 Yes.
34:49 Speaker 04 Can we talk a little bit about that?
34:50 Speaker 05 Absolutely, I'd love to. I appreciate that. This is our 40th year in business and I asked our employees, what do we want to do? Let's do something fun this year. What do we want to do? And it started out as something, you know, fairly small. Various things, but it kind of developed into the employees got together and brought it to me and said, is there any chance we could do something like this so that we can show the community what kind of company we really are and that we can pay them back and say, thank you for keeping us in business for 40 years. And when they first told me,
35:28 Speaker 05 I said, no, that's crazy. That's crazy talk. But the more they hammered me and, you know, made me think sometimes you got to take a risk and do something that maybe you're uncomfortable with if you know you're doing the right thing. And so what we came up with is for every month this year, we'll be providing somebody in town who is in need, and in need is a big, a big wide comment. And so we're providing them either a complete solar system, a brand new roof, or a new air conditioning system, depending on the need that they have.
36:08 Speaker 03 Wow.
36:09 Speaker 05 And we're doing it for 12 months this year. We've done, we've done one installation, and it was a tremendous success about three weeks ago. You know, we had all the news crews out there, and we had a terrific time. I brought all the employees out so they could see what we're, what we're doing. So they weren't just sitting in the office and somebody else. I wanted everybody out to see it, touch it, and be a part of it. And the first one went great. We have another one coming up next week, a new air conditioning system. And then our third one that we'll be doing is kind of hush, hush, and I hope she's not listening to the show, but we're, we're, we're going to do a teacher who, who has a great impact on the community. And that, in my mind, is, is where that term in need
36:53 Speaker 05 is, well, we're going to reward somebody for doing great work of the community.
36:56 Speaker 03 Oh, that's fantastic. That's really cool. I mean, what a, what a great way to get back to the community that's given to you.
37:02 Speaker 05 That's exactly the point. For 40 years, I've been able to feed my family, and they've been able to, my employees have been able to feed their family. And it's all because of the community. And so we wanted to really, literally pay it back.
37:15 Speaker 03 Well, Jack, we want to thank you so much for coming on the show, clarifying so much here. And, you know, we're proud of what you're doing. I appreciate that very much. And keep up the good work there at Bland. That's Jack there. He is the executive manager at Bland. We're Money Wise. We're going to take a quick break.
37:34 Speaker 00 Are you curious to learn more about how you can be money wise? Check out the Money Wise website at MoneyWiseGuys.com to get more info about what we do. 101.1 FM.
37:49 Speaker 03 Thanks for tuning in. We really appreciate it. We're Money Wise. If you missed any part of this or previous shows, go to MoneyWiseGuys.com or wherever you stream your podcasts. You'll find us there. Sammy, I was curious over the weekend, I was reading and I discovered or just was brought to my attention that there's no single country in the world that would be able to produce an iPhone from beginning to end. End to end iPhone production is virtually impossible. And right now, there's dozens of countries that are involved in creating the iPhone, which is...
38:24 Speaker 04 I mean, that would probably be impossible unless you live in the Harry Potter realm.
38:29 Speaker 03 Yeah. And not only that, but it led me down this rabbit hole of doing research. Well, what country could do it? And how long would it take for that country to do it? And it turns out, it's pretty shocking, at least for the research that I found. The United States would take 15 to 20 years if we tried to create the iPhone on our own. You have to think about how much goes into it. You have the raw material sourcing, you have rare earth elements such as neodymium, turbium,
39:04 Speaker 03 words that I can't even pronounce, dysporium.
39:07 Speaker 04 Are these new stuff or did we study these in high school in the table?
39:11 Speaker 03 I think we were supposed to study them in high school. But even like cobalt, which is used in batteries, it largely comes from Democratic Republic Congo. Like, there's literally like one country in the world that is mass producing cobalt and it's... You know, it's it's terrible, the human rights tragedies and all of that. But it's a very diverse global supply chain from all of these different rare earth minerals. Let alone, you know, there's not a country in the world that has all of them. So, you know, in part, that's it's years to figure out what alternatives would there be to find what elements could go into making something that might be similar to an iPhone.
39:49 Speaker 03 You have specialized supply chains, like Samsung produces most of the world's OLEDs displays. And there's another big company that facilitates the chips, Sony and TSMC. You also have semiconductors, which this has been in the news during COVID. It was all brought to our attention that, oh, there's only a few countries that make semiconductors, including Taiwan and South Korea. I mean, Taiwan, it makes you, you know, it's not, it's pretty obvious why China wants Taiwan.
40:22 Speaker 04 That's right.
40:23 Speaker 03 China is also would be far away from being able to produce. It'd also take them 10 to 15 years, even though China leads the world in assembly, precision assembly and labor. You know, they have Foxconn, for example, and millions and millions of skilled workers and these massive assembly lines. But they lack other things. China is way behind in advanced chip production and and those technologies that are needed. And of course, the rare earth minerals that they that they don't have.
40:57 Speaker 03 European Union, we're talking about 12 to 18 years. They they lack the assembly infrastructure and chip production and raw material refining. And so.
41:09 Speaker 04 Yeah, it makes sense for Europe to be a little bit longer because they lack a couple of the items that you've mentioned for the United States or China.
41:17 Speaker 03 Yeah, you have Japan is the only country that has certain camera sensors. And, you know, this is, this is, I think there's a lot of.
41:28 Speaker 03 A lot of misunderstanding about how interconnected the world is. Economically speaking, the days of Adam Smith economics, you know, this is simple supply and demand, don't, aren't even, it's a different universe that we exist in now.
41:44 Speaker 04 He would not know if he came out today, Adam Smith. He would not know how. I mean, I think it would be very challenging for him as an economist.
41:52 Speaker 03 Yeah, yeah, I would, well, yeah, because all of a sudden it's, we also have this new behavioral economics and behavioral finance.
42:01 Speaker 04 And I think that's the biggest change from the supply and demand type thing or question is the behavior. And the behavior just changed in the last four years, Sher. We're just talking about people working remote. So the buying of, the behavior of buying for people that are working remote is now different than the people that work in the office.
42:22 Speaker 03 Right. This kind of came up with the recent tariffs that were imposed and then taken back on Canada and Mexico where these three countries alone manufacture a lot of cars, but part of them are manufactured in Mexico, then they're brought across the border and then there's some more manufacturing, then they're sent back to Mexico and there's more work. And then, so it's kind of this back and forth of these different parts and assembly of cars that it was like, you can't just put a, you know, slap a tariff on it and then expect us to start building overnight a manufacturing plant to make a car. It's not gonna happen.
43:01 Speaker 04 Yeah, so the change is gonna be, it has to be gradual. And that's what we've talked about on the show multiple times. It is not gonna be overnight. If you're seeing, if you want to see something overnight, this is the results of what we're gonna have. We're gonna have the market reacting a certain way where people are gonna start panicking and having sell offs. And that's what happened last week and it's happened today again, in my opinion.
43:20 Speaker 03 Yes, it is. It's really unfortunate because it's, you have Wall Street also overreacting. And, you know, it's, this is, the global, the global economy is just so much more complex and, you know, requires.
43:37 Speaker 04 Grace for me is that look, people are still gonna buy and people are still gonna consume.
43:42 Speaker 03 Yes. Yeah. In fact, just today, you know, with as far down as the markets are, consumer staples actually did pretty well today. You had companies like Pepsi, Coca-Cola. Coca-Cola is up 2% today, you know, people are still gonna buy.
44:00 Speaker 04 That's right.
44:01 Speaker 03 Still gonna buy their Coke and Pepsi was up 3%. Procter and Gamble was up 1.2%. So.
44:06 Speaker 04 Essentials.
44:07 Speaker 03 Yeah, these are consumer staples. Like you said, the end of the day, the economy is just people willing to buy something, you know, good and a service, a widget that they need. And there's always going to be something that, you know, people are going to need. Well, thank you so much, Sammy. Thanks for joining the show today. You won't want to miss tomorrow. Taxman Tuesday. John Duffield, Stump the Duff. Stump the Duff tomorrow. Don't miss it. If you do miss this or any other shows, you can go to moneywiseguys.com or wherever you listen to your podcasts. In the meantime, remember these three things. Be smart, be safe, and always be money wise.
44:44 Speaker 02 Securities offered through SCF Securities, Inc., member FINRA/SIPC. Investment advisory services offered through SCF Investment Advisors, Inc. SCF Securities, Inc. and Money Wise Wealth Management are independently owned and operated.
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