What's Going On? The Big Beautiful Bill, AI’s Rise & America’s Reinvestment Wave (Ep 108)
We break down the sweeping “Big Beautiful Bill” from tax cuts to AI deregulation and what it means for the economy. Plus, how AI is already doing 30–50% of work at major firms, what current interest rates mean for real estate, and why companies like Apple, Nvidia, and TSMC are pouring billions back into U.S. manufacturing. Is this the start of a true American industrial revival?
Transcript - The following transcript was generated with AI technology, so please excuse any typos or inaccuracies.
Brian Doe 00:02
Today, we'll take a quick pass at the big, beautiful bill a little bit on AI global chessboard of military spending, NATO and what interest rates are doing to the real estate market, as well as reinvestment that is occurring due to tariffs and the movement of the supply chain back to the US.
Speaker 1 00:27
It's time to make the dough rise. The financial podcast with Brian doe.
Walter Storholt 00:37
It's another episode of Make the dough rise. Walter storholtier alongside Brian doe, certified financial planner at living worth Wealth Advisors, serving you in the lake country and beyond, based right out of Greensboro, Georgia. Brian's been a Certified Financial Planner since 2013 and has more than two decades of overall financial planning experience. And we're looking forward to today's episode with Brian as Hey, Brian, there's not a whole lot going on, right? I mean, the world's been pretty quiet the last couple of weeks.
Brian Doe 01:03
Yeah, just kind of dull these days, isn't it? Yes,
Walter Storholt 01:07
oh my goodness, we have one thing that dominates the news for a little bit, and it gets replaced very quickly. I I saw you wanted to talk a little bit about the big, beautiful bill today, and I was like, Oh yeah, that thing, I forgot that we had that. Some other things
Brian Doe 01:18
cycled it just every if you're not paying attention, it changes about every two days. So something that used to run for months now seems to be in the rear view mirror within a couple
Walter Storholt 01:30
days. Yeah, no kidding, a lot has changed in the way that kind of the news operates, and in our own like consciousness of it in the time to absorb before you have to move on to the new things. So it's we're all learning, I think, as we go along here, well, before we dive into all of that, everything else going well in your world.
Brian Doe 01:47
Yeah, we're just enjoying the summer. Natalie and I are getting revved up for our annual spring hop. We're gonna up our game a little bit this year and go get diving certified.
Walter Storholt 01:56
That's pretty cool. That sounds pretty neat. Where are you guys gonna do that
Brian Doe 02:01
down in Alachua, Florida. They've got all the Jenny springs and itchy tuckney and several all up and down the Santa Fe River. There's springs that we'll go to, but this will be a day of pool work, a day and a half in the springs, and then we've got some coursework to finish beforehand, but I bought some of those little portable dive breathing apparatus, just so we can go down and we're there for the Instagram pictures. We're not there for like, serious diving and right cave exploring and all that stuff, but to refill them, you have to be diving certified to get the extra tanks and stuff like that. So I thought, well, it might not be a bad idea just to understand what we're dealing with and be safe and and properly trained. So
Walter Storholt 02:45
yeah, certification can be part of the experience, I'm sure. Yeah, and a good resume builder for for Natalie too. It'll be, it'll be fun. And you never know when you might get the bug for something, right? So you may go down there, and then all of a sudden, she might get the bug for this and want to dive into it further. And, oh, no pun intended, and explored. It
Brian Doe 03:05
would be nice, too. If you're like, on vacation or something, somewhere Caribbean or who knows where, if you could do some diving. I really enjoy going to those reefs and seeing all the fish and the marine life and all that. I don't go deep, but I would like to be able to stay down and check stuff out. So
Walter Storholt 03:23
yeah, yeah, I'd like to never do, like, a cage diving sometime. I'd love to do a cage dive with the sharks coming up to you and that kind of thing. The ones where the sharks are swimming around you and you're out free. I don't know about that one as much,
Brian Doe 03:35
those look a little scarier, but yeah, yeah, you let me know how it goes. Walter,
Walter Storholt 03:39
yeah, we'll see. I don't know when that's not exactly on the agenda in the near future, but I don't know. I think that's one of those activities where I won't seek it out, but if it ever like presents itself, I would be like, All right, let's do it, you know. And let's try
Brian Doe 03:52
it, the cage dive. Yeah, the cage dive part. Laura did it in South Africa one time, so if you want okay, testimonial, you can check with her.
Walter Storholt 03:59
Okay, all right, sounds good. We'll do well, let's dive in here, Brian and start talking about all these different things that we've got going on. We do this every once in a while, right, just to check in of the economy or the latest news, or just kind of what's happening in the economic world. And right now, I feel like there's not necessarily one thing dominating. We've got kind of a lot of different forces and factors kind of tugging at us here.
Brian Doe 04:19
Yeah, yeah. I think, honestly, if I had to say what is the one big overarching topic, it is the repatriation and movement of the global supply chain back to this hemisphere, but that overlaps with tax code and interest rates and energy policy and development and infrastructure in the US. And there's so many topics that all well, AI is the other one we'll we'll touch on today, but all of those are intersecting right now, and I think I can tie them all together a little bit and talk about what I think that means for portfolios and investment strategies. And really the whole future outlook that is probably a little more optimistic than what you're getting in the mainstream news.
Walter Storholt 05:06
Yeah, sounds like a great plan to me. And it's funny, you mentioned, you know, companies coming back here, the tariff conversation, talking about things that kind of seem to fall off of the news cycle a little bit, but still very much part of our lives. So we'll get there and cover all of it. Where do you want
Brian Doe 05:21
to begin? Well, we can do a quick pass at the big, beautiful bill. It's early, so there's a lot of negotiation that's going to have to take place, and there's different versions of it still sitting out there. But I was really excited with Elon Musk and Doge and all the cutting that they were looking at, the fraud, waste and abuse. Really thought they were going to do some great stuff, and that seems to have fallen by the wayside, maybe, maybe not. I'm not sure where it's at, but obviously you've got Congress has to approve or cut spending at the end of the day. It can't be a unilateral, you know, CEO type decision. So I was really hoping we were going to do something about maybe eliminating the deficit. And it was even hopeful for a little while that we might be able to make some progress on the debt, but the big, beautiful build has just blown that out of the water. In my opinion, the trillion dollar for military spending, and obviously, selfishly, I like to see the tax rates stay and become permanent. I think that's actually a good thing. The cutting of tax on tips and overtime targeted at the right group. I think that that could be a good thing. Eliminating taxes on Social Security is a little more controversial, because that people who are in the lower income brackets. If Social Security is your only income, it's not being taxed anyway. That really does, truly just help people who also have pensions and dividends and Ira distributions and again, selfishly, that's my clients, and it impacts them, but I'm truly concerned about maintaining the long term viability of Social Security. So you know, if they, if they cut taxes on Social Security for the more affluent, they're going to have to just tax other, somebody else more or delay benefits for future recipients, and all the other cuts that we've talked about in the past. So not super excited about the big, beautiful bill. We'll see what happens if there's enough economic development in there to eclipse it somehow. I'm skeptical of that as well, but if we don't start making some progress on that, I'm gonna have to re sound my alarms on too much
Walter Storholt 07:34
debt. Yeah, I agree with you. It's just very whiplash inducing, right? Like, cut, cut, saving all the stuff, and then it just kind of seems like we went the other direction with the actual bill that came through, so that caught a lot of people in the same way of just that bit of whiplash and like, Okay, well, so what are we doing
Brian Doe 07:52
here? Yeah, and I'm in favor of, you know, lower taxes and things that are economically stimulating and stimulates growth. And we got all this investment coming back to the US that we'll talk about. But at the same time, if you don't do something about the spending, and unfortunately, the spending is very heavily tied to Social Security, Medicare and Medicaid, and those problems, those programs, are impossible to Dutch like you can't really cut in a meaningful way on any of those so military and all the other stuff were the ones where I thought maybe we could get some efficiency save even if it's a 50 or 100 or a couple 100 billion dollars that that can add up after a while, and they just don't seem to have, they have the will to actually do that. So yeah, not, not real optimistic about what's
Walter Storholt 08:41
happening in Washington. Certainly appreciate the skepticism on that one What else are you looking at? The
Brian Doe 08:45
one good thing that has arisen lately is it looks like there's going to be some cooperation from other NATO countries to increase their defense spending. Now we've talked in the past about how the US has really been the protector of the global waterways, the Peacekeeper of the world, keeping shipping channels and supply chains and free trade going. And at the end of the day, most of the European countries that were members of NATO were not living up to their contribution and expectations to NATO. Well, Trump ruffled everybody's feathers in his first term, you know, going in and saying, Oh, you're not paying your share and you need up your spending. And everybody did not take well to his non diplomatic approach to it. But if you look at what's happening now, they all all but one NATO member, have now pledged to increase their defense spending to 5% of GDP Spain. Spain's the only holdout right now. Well, that's great, that that really solidifies the defense and preparedness of the West. Should China or Russia or some coal? Covidion of other countries, we're to try to get together and try anything. It's a I think it's a great deterrent, and I'm glad that somebody else besides us will be spending more to increase their readiness. I just hate that we've cranked our defense budget all the way up to a trillion dollars and celebrated that. But I will say that there does present a very good investment opportunity in US and European defense companies, because there's gonna be a lot of spending that's gonna be happening there.
Walter Storholt 10:29
A lot of spending all over the place. Sometimes that spending leads to increased taxes. But spending is not always happening, I think in the government areas, right? We have private companies spending a lot in, I don't know. Is this like the new space race for a lot of people? You know, AI influence poking, yeah.
Brian Doe 10:48
So a lot, a lot is happening there, and that overlaps with productivity, some of the investment this microchips and supercomputers and data centers that they're talking about putting in place. I saw the other day that Salesforce had said that AI is now doing 30 to 50% of the work in some areas of their company, so that a lot of people, yeah, it didn't take long, and it'll be interesting. Microsoft and Google also said that AI is producing 30% of their new soft computer software code. So there's going to be some areas that are going to be, you know, heavily impacted for employment, if your background was software engineering or coding, the computers are going to be doing a lot of that work. I'm hoping that maybe the computers will do some of the more baseline, routine, foundational work, and then people can focus on new higher ends of and take it further, rather than grinding out every, every line of code manually. So we'll see what happens there. It's
Walter Storholt 11:53
really interesting when I think looking at the the AI developments, and I agree with you, there's the replacement of the lower level and then the upper level that you're trying to maybe get elevated to or reach to, what an interesting struggle that's going to be to watch over the coming years.
Brian Doe 12:08
So the other big area is going to be power to fuel and run all of these AI data centers. It's clearly going to take a huge investment in new power, where they're going to have to take a look at nuclear. I think I saw the other day that a New York is actually going to be adding a new nuclear reactor. There's been some talk of creating dedicated power centers up in places like North Dakota, where they've got all the access to the fracking natural gas. They could literally build a natural gas driven turbine and put a data center in North Dakota naturally cools itself probably nine months out of the year. And you would not have to build a long plugged into the grid power center for it. You would literally have it dedicated directly to that power center. So also some other great investment opportunities are?
Walter Storholt 13:01
Yeah, absolutely. And that'll open up some, I don't know. Maybe this will have its own little bit of a COVID wave where that allowed people to move and go to unusual places. Maybe kind of this interesting need that AI has for power will do the same for some underutilized areas. I'm just thinking of. North Dakota is not exactly like the center of commerce, but here's a chance for big infrastructure and maybe jobs and that kind of thing moving to a new area.
Brian Doe 13:27
Interestingly, I saw a number the other day that may appeal to the you've heard of the digital nomad phenomena? Sure. Yeah. So South Dakota is the most digital nomad friendly state for residency. You only have to be in the state one day a year to qualify for residency. Wow. And you get very favorable tax treatment. So maybe, if they have the data centers there, maybe they get the digital nomads and the virtual workers. I don't know they would really need to be there geographically, but just an idea to if you're looking for a place to set up residents. South Dakota may be your place, and that may be where a lot of the tech companies are going. Yeah,
Walter Storholt 14:05
that's pretty interesting. Something that was big news for several years, interest rates and real estate. Again, another thing that kind of got quiet with everything else, pushing it out of the way. But there's been some movement in that area too lately. Well,
Brian Doe 14:18
the movement has been the inventory of existing houses outpacing the number of buyers out there. And the last stat I saw showed there was, like a half a million more homes for sale than there were buyers. And I don't know about you, I once in a while I get on Zillow and just kind of window shop, I guess, sure, and a lot of houses have been sitting on the market a little bit longer, you're starting to see price cuts. Price Reductions, percentage of houses out there with price reductions is going up. The relative affordability of houses is at an all time low because prices have gotten so high and interest rates are back up. I did see, I forget the exact stat, but the ratio of the price of gold relative to houses is as expensive as it's been since the 70s. So be interesting to see what actually happens. But I think a lot of people are sitting on the sidelines thinking we're going to three or 4% interest rates, you know, because everybody during COVID that locked in these these low rates either can't sell because they would have to refinance at a rate that would be at least double that, and new buyers are finding it harder to justify the financing and all that. So lot of sellers, too, have kind of locked into their what I call it make a wish price. They've priced themselves up at the top end of the market, and they're hoping for that big fat capital gains to realize a chunk of tax free. And I think some reality needs to come back to the real estate market. The people I talk to say that the high end and the low end are still moving. It's kind of the middle of the market that, you know, maybe second homes or upgrades and things like that. First time buyers, you know, and people just needing to get into a house still buying. People buying at the top end, their price isn't as much of an obstacle. And a lot of those are maybe not financing anywhere, just cash purchases. So if you're if you're in those two categories, you're probably okay. But if you're in that middle, if you're a buyer, I would not hold your breath waiting for rates to come down to 3% that's that, yeah, you'll be doing good if you get a rate in the 5% something weird would probably have to happen for it to even get down in the fours so and with all of the reinvestment capital requirement that's going to happen over the next several years, that's going to be inflationary. So I really don't see a likelihood that rates are going to come down significantly anytime soon. Yeah, if you're in the real estate
Walter Storholt 16:55
market, I feel like, if it gets down to the you know, if it can crack five and get into fours, great, even though in five, I feel like that's going to at least be reaching at least a close enough point to where you could see people at some point, you know, due to just needing to upgrade homes or get a bigger space, start entertaining a little bit more of letting go of those lower end mortgage rates. If that's that the home need, you know, kind of dominates at that point, jumping from those, you know, 2.7 fives and threes to the sevens and eights was a much bigger, bigger jump.
Brian Doe 17:28
But you would be foolish to offload a 3% mortgage. I mean, that that's that's practically free money. And if you're getting a tax break for itemizing the interest expense and all that, sit tight, upgrade or make do with with what you've got, if you can. But yeah, I would like to see if you could get five and a quarter to five and three quarters. I think that would be a very respectable rate. I know when I bought my first house rate, this was in the late 90s, called mid 90s. Rates had been so high through the 70s and 80s, I got mined at like 8% I thought I was getting really cheap money at the time. Yep. Now that would be just undoable,
Walter Storholt 18:06
right, right? Yeah, unfathomable, almost based on most recent history. So Well, let's get to the last one in the big one that you've got on the list here, Brian, and this is the one you kind of tease the most at the beginning, saying, Hey, this is, this is the one I really want to focus on here, and that's this reinvestment back into the US and some of the tariff promises. Sounds like you're starting to see evidence of of this. Maybe some paying, you know, paying for coming to fruition, paying dividends already.
Brian Doe 18:32
This is what I've been saying all along. If you have decent energy policy, good tax policy, some a little bit of an incentive to push people back. We are seeing not not because of any one thing, but because of the combination, maybe, of the exposure during COVID, of the vulnerability of the supply chain being very heavily China based, you've got very abundant and cheap energy here in the US, and if you don't have an administration that's hostile to the development of that, and we've got a better birth rate and population growth rate than Europe. Europe has really hindered and hampered themselves with the green dream and de industrialization. I think it's kind of sad to see what's happening there. But yeah, I think China just being very heavy handed with their COVID and lockdowns and things have made people a little more wary. India's becoming more involved and engaged and trying to do some stuff to attract the low end manufacturing and distribution, I don't know, maybe tech assembly and maybe some textiles and things like that. And then Southeast Asia continues to be a powerhouse. A lot of people moving there because China's the big tariff and trade target for Trump. And if you take all of those factors combined, we've suddenly seen this huge wave of. Of big, big announcements. And I just wanted to run through a few of them here to highlight the magnitude of these. Because I don't know if everybody's aware of all the good developments and the positives. But for example, Taiwan Semiconductor, they're going to do $100 billion investment in the US semiconductor and chip manufacturing. Nvidia has announced a 500 billion investment in US based AI infrastructure, and they're going to be doing this probably over a four year time period, more than a million square feet of manufacturing space for its new Black Wall chips in Arizona and then some AI supercomputer assembly in Texas. So that's, that's great news, that big and big dollar investments, and these will be higher end skilled tech type jobs. Apple another 500 billion. They're gonna they're bringing a lot back to the US for manufacturing and training. Yeah. So right, right there you've got, what, 1,000,000,001 1.1 trillion already with those those three, Samsung LG, they're considering moving some plants from Mexico to the US. Hyundai has pledged to invest 21 billion in 20 let's say 2025, to 2028 and they're going to expand manufacturing, and they will also be using a lot of the LNG natural gas energy in places like Louisiana, so that, again, these things are all all intersecting. A lot of us auto manufacturing Ford and Bronco and f1 50s. They're going to be moving production of those back to the US Honda, I forget there were several other car companies that were going to be bringing good will again, a little more higher end assembly and manufacturing jobs. Those are, those are great, great work to have here in the US. And then maybe you saw the big merger between Nippon steel and US deal. That was like a $14 billion deal. And I think that is going to be, it will be jobs, US based jobs, and gives us back the strategic reliance, or self reliance, on on steel production. So I think that was a good deal. And then GE couple of areas. They're aerospace investing. It's going to be investing a billion dollars in manufacturing operations across a number of states, their washing machine productions coming back from China to Kentucky. That's the kind that I would think would maybe go to Mexico or maybe Vietnam or something like that, actually coming back to Kentucky. And probably the tariffs a big factor in that. Then you got a few others, Merck, about $8 billion Volkswagen is considering production here in the US, Saudi Arabia, so Foreign Sovereign funds or entities, $600 billion of new investment in the United States. And I think a lot of that'll be tech and AI based and J and J was going to do another 55 billion in new US, manufacturing. So big companies, big investments, trillions of dollars that have been committed. And again, this is going to be a multi year phenomenon, and wave that is just getting started, I would like to see them more focused on building out quality infrastructure, expanding roads and transportation capabilities and good energy policy and cheaper energy is going to be a big leading factor to that. If you get this manufacturing and investment happening back here in the US, it will create a growth wave in, production and construction and building materials and concrete and all the things that go into building these facilities. And then three, four or five years down the road, on the other side, we should be very nicely positioned for a strong, strong economic position for the us
Walter Storholt 23:57
all. Great stuff, it sounds like here, and amazing to see some of what's going on under the hood. And if it's good news, you probably do have a harder time finding it, because that doesn't usually lead the news
Brian Doe 24:09
story. No, no, not at all. Nobody's talking about the good side of it.
Walter Storholt 24:14
Absolutely anything else you've got your eye on, or have we covered it all? Brian,
Brian Doe 24:18
no, that's probably enough for one day. I don't want to really dive into the geopolitics of what's happening with Iran and Ukraine. What else is some of those hotspots that are impacting the world right now. I don't have enough insight into those or knowledge to really pontificate on them, but I will say the US has, the US markets have responded very positively in light of what has just happened, so we'll take that as a good sign.
Walter Storholt 24:46
Yeah, those are always the X factors, though, right? So we have to, you know, at least a lot of the things that we covered here, they're in progress. They're happening, they're morphing, and they're shaping, but at a slower speed. So we can analyze them and talk about them. We could probably try and talk about. All of those, some of those other things that you mentioned, but something could change the very next day that totally flips whatever we talk about on its head. So I think when things are moving that fast, we're best to just sit back and watch at this point and just be aware that, hey, that's the X Factor. And in the financial world is non financial, but geopolitical forces can create havoc in a plan. And so get a plan in place that can at least weather those storms, adapt to them, and, you know, plan for them without having to know the exact future of how it's going to plan out. And I think that's really important to just remember in times like these as well. Very well said. Well, good breakdown on all of this. If you found anything from the big, beautiful Bill conversation to the AI talk and wondering about real estate and interest rates, and of course, the big news of kind of that reinvestment flowing back into the United States, if any of that has led to questions about how well prepared your financial plan is for the future, don't hesitate to reach out and get some more control over your financial future by finding a great place to start. And that's with a visit and a conversation with Brian and the team at living worth Wealth Advisors. All you have to do to get in touch to talk to Brian is go to livingworth.com and click book a call. That's that easy. Livingworth.com click book a call. Brian's a Certified Financial Planner, professional meaning he meets the highest standards of training and ethics always putting your best interests first, and when you go to livingworth.com and click book a call, you will be able to take advantage of a complimentary 15 minute conversation with Brian to get some clarity on your financial goals and prepare for that more secure tomorrow. So don't miss out. You can go to livingworth.com or call 706451, 9800 contact info in the description of today's episode. Brian enjoyed this one with you, my friend. Hope you have a great Fourth of July, and we'll catch up with you again soon. You do the same. I'll look forward to it. All right. Take care, everyone. We'll see you again soon, right back here on make the dough rise. You.
Speaker 2 27:00
Announcer, make the dough rise is brought to you by living worth Wealth Advisors with a central office in Greensboro, Georgia, but serving the lake country and beyond. The podcast is available on Apple podcasts, Spotify and all your favorite podcasting apps. Subscribe today and never miss an episode. Just search for make the dough rise with Brian doe, you can also visit make the dough rise.com to listen to recent episodes. If you'd like to contact the show or schedule a complimentary financial review with Brian and the team, just go to make the dough rise.com and get in touch through the website or call 706-451-9800. Thanks for listening to make the dough rise.
Ben George 27:42
Investment Advisory services offered through Main Street financial solutions LLC, information provided is for informational purposes only and does not constitute investment tax or legal advice. Information is obtained from sources that are deemed to be reliable, but their accurateness and completeness cannot be guaranteed.
Listen & subscribe on your favorite app
For important disclosures about Main Street Financial Solutions, LLC, including our Part 3 Relationship Summary (“Form CRS”), please visit https://adviserinfo.sec.gov/firm/summary/305834