The Future of Social Security & Bed, Bath & Gone

Our 2 Cents – Episode #136

The Future of Social Security & Bed, Bath & Gone

Our 2 Cents is back this week with a discussion about what’s in store for Social Security in the years ahead. Plus, we’re taking a closer look at Bed, Bath and Beyond’s demise and lessons to learn from what happened to the once beloved retail chain.

  1. The Future of Social Security:
    • The recent negative headlines about Social Security have some people worried about their preparedness for retirement.
    • What are some possible solutions to ensure the fund’s solvency for the long-term?
    • How any changes made to the Social Security program could impact your claiming strategies.
    • What risks are involved with some of the possible changes?
  2. Bed, Bath & Gone:
    • After a long struggle to stay in business, Bed, Bath & Beyond declared bankruptcy and will be closing all its stores.
    • What ultimately lead to the company’s downward spiral?
    • The reasons why this is another prime example of the challenges that come with picking individual stocks.

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Podcast Transcript

Announcer: You are listening to Our 2 Cents with the team from SGL Financial, building wealth for life. Steve Lewit is the president of SGL Financial, and Gabriel Lewit is the CEO. They’re here to discuss all the latest in financial news, trends, strategies and more.

Gabriel Lewit: Good morning, good morning. And welcome to Our 2 Cents.

Steve Lewit: Listen to you, froggy.

Gabriel Lewit: Yeah. So you might notice, depending on how closely you listen and how high your volume knob is here today, or volume button. My voice was cut out all last week.

Steve Lewit: He was in bad shape for us.

Gabriel Lewit: There’s a reason. Sorry we missed the show last week. It would’ve just been the 1-cent show. Had we done it last week, it would’ve been just Steve.

Steve Lewit: You could have coughed and grumbled.

Gabriel Lewit: Oh, my goodness. Yeah. I’ve lost my voice before, and it’s about 90% back as of this week, but it’s never taken this long to come back before.

Steve Lewit: You were really growly.

Gabriel Lewit: My favorite joke right now is that I still can’t meow, with a high pitch, like a cat.

Steve Lewit: Meow.

Gabriel Lewit: I won’t even try it, because I can’t do it. My vocal cords will not go to the higher octaves.

Steve Lewit: Yeah. But you worked all week. You still were here.

Gabriel Lewit: I toughed it out, man.

Steve Lewit: You toughed it out. I’m proud of you, son.

Gabriel Lewit: I only had to reschedule a couple meetings with clients, where I literally… They would not have been able to hear me. Anyways, you can probably tell a little bit here, with my voice here today, but hope you’re doing great. We’re going to cover a lot of great topics for you today.

Steve Lewit: We do.

Gabriel Lewit: Yeah. We’ve got some good stuff lined up. Most notably, just to dive right on into the pool here, we’ve got Social Security. So you may or may not have been seeing this more in the news lately, Wyatt’s making a resurgence, tends to go through cycles where it’s talked about for a bit, then it dies down, and then it’s talked about again. I think we’re going through one of those cycles where it’s more prominent in the news.

Steve Lewit: Yeah, it is, for some reason. I don’t really know why, but it is in the news.

Gabriel Lewit: Yeah. The questions we’re getting from clients, again, because of this, more frequently, just in the last few months, is the same question that, honestly, we’ve been asked for the last few years, but the deadline date gets closer. The date, I’ll mention in just a second. And that question is, can we count on Social Security, in the future, in our retirement?

Steve Lewit: What’s interesting about that, Gabriel, is that… I was given a seminar last week, a dinner seminar, and I had this gentleman who… Was a gentleman, but he was very outraged at the seminar, that Social Security is 100% ending in… What’s that date you’re going to give?

Gabriel Lewit: So, the date that I’m going to give, which I’ll give now, is… In 2033, it is predicted that, as of currently, there is only enough funding for the program to pay out 77% of benefits to Social Security beneficiaries or recipients.

Steve Lewit: Yeah. But his point… He said, “No, no, it’s going away. There’s going to be no Social Security.”

Gabriel Lewit: There are some misconceptions out there. This is part of what you and I were talking about, which prompted us to do… Before the show here.

Steve Lewit: Exactly. Yeah.

Gabriel Lewit: And it’s been a bit… I believe that we were going back through our show notes and summaries, and I don’t think we’ve talked about this in quite a bit. If we did, recently, we’ll talk about it again. So what is the question here? The question, again, is, will it be there for you? Dad, if somebody comes to us, or to you, and asks you that question, he says, “Steve, I’m a little concerned about Social Security. I read this article that only 77% of benefits are going to be paid in the year 2033.” What do you think?

Steve Lewit: “Yes” is what I think.

Gabriel Lewit: Yes. That’s the one-word answer you give.

Steve Lewit: Yeah. Here’s the problem. You got 60, I think, the number… Don’t quote me on this one, folks, but I believe the number is… 60% of people in the United States, Social Security is their only income. So, if Social Security gets cut 20% or 30%, that’s a disaster for a huge population in America. And I don’t think that’s going to happen. So, my bet is that there is a solution, somewhere along the line, that Social Security doesn’t get cut. Or it gets cut for new people, but not people that are currently getting Social Security that stays at the same level. That’s my bet.

Gabriel Lewit: That’s what we’re going to dive into a bit here. What are the possible solutions? What are the risks or challenges of those? How does it impact your claiming strategy today, if you’re thinking about claiming? And so you’re spot-on, though. What will happen? Will it still be there? I think so, yes. I say the same answer. I do believe it’ll be there. And I do actually think it’ll be solved for most of the people that are retiring today. But that’s just our opinion. So it’s important in planning-

Steve Lewit: We don’t know for sure.

Gabriel Lewit: Yeah. So it’s important, in planning, to always have some backup plans. And especially with something as complicated as Social Security, I think the more that you understand about it, the more informed you’ll be, and the better off you’ll be able to make the right decision for you.

Steve Lewit: This is a little bit of dark humor, but at one of my seminars, I was asking, “So what’s the solution to Social Security?” And this lady jumped up, and she said, “I think I’ll die early.”

Gabriel Lewit: I guess you don’t… We don’t care what your benefit amount is.

Steve Lewit: And then, she said, “I don’t care.”

Gabriel Lewit: Let’s not go down that option.

Steve Lewit: But we have had… I know you have, and I have. We’ve had people, in our planning meetings, that said, “Can I count on this? Should we cut it back 10%, 20% and 30%?” And depending on the person, I’ve done plans where I use 70% of Social Security projected, rather than the full amount because-

Gabriel Lewit: Yeah. That would be a big, what we call, stress test of your plan to see how it works. Now, a lot of what we were talking about here is positioned in an article we found as well, recently, in the news. So, there’s an article about how it’s been, in the news, lately, talking about survey results and respondents’ feelings on Social Security. So, there was actually a study, here, done by Allianz, an retirement-focused company that does life insurance, annuities, investments as well. Allianz is huge. They’re not just annuities. They do tons and tons of things. But they do a lot of research studies. And so they came out with a study here, they interviewed over 1,000 people. And of them, 74% of them said that they felt they cannot count on Social Security benefits when it comes to the money that they’re going to have in retirement. So that is the prevailing feeling out there, with most retirees. This is a really big pain point and uncertainty point for them. And it’s causing a little bit of distress, not knowing the future of this very important program.

Steve Lewit: It’s part and parcel, Gabriel, of a lot of fear running around, like now, in the world, and in the United States, that the US dollar is going to disappear, that China’s going to take over. It goes on and on, but this is… Social Security is, like I said, a very important source of income. And the question is, will it, or won’t it be there? That is the real question.

Gabriel Lewit: Yeah. Some of the news might be coming from a recent, basically, report issued by the Social Security Administration trustees, this was in March, where they put out an annual report. If you are familiar with that, or not familiar with that, that’s part of what they do. And they said that the amount of funds that they have for the program, again, will be only able to pay 80%. This says… What it says here. 2034, 1 year earlier than previously projected, the program may be able to pay just 80% of the combined funds benefits. So basically, this is 10 years away, in 2034. This is pretty much, in retirement planning terms, right around the corner.

Steve Lewit: Definitely. You know time flies.

Gabriel Lewit: It certainly does. So the big question here is, what do we do about it?

Steve Lewit: Do you mean what do we do about it from a planning perspective, or what do we do-

Gabriel Lewit: As a country.

Steve Lewit: As a country.

Gabriel Lewit: Yeah, as a country. Right.

Steve Lewit: Okay.

Gabriel Lewit: And then, we can get into the planning perspectives here. Basically, the prevailing consensus is, changes have to be made naturally, because if you just stay the status quo, and just leave things as is, then nothing will change. That’s what those projections are based upon.

Steve Lewit: It’s like, if you see a cliff coming, and you don’t change direction, you’re going to go over it.

Gabriel Lewit: But what’s… You know the answer to this. Why hasn’t this been tackled? Everybody sees this coming, in government. Politicians, congress, trustee board, they all see it coming. Why has nothing been done to tackle this yet?

Steve Lewit: Why has nothing been done on the federal deficit? Why has nothing been done on a lot of things? It’s a political football. Who wants to say, “We’re going to cut Social Security,” or “We’re going to raise the retirement age, or “We’re going to do something?”

Gabriel Lewit: It’s akin to the issue we’re going through right now, which is this argument over the debt ceiling. We won’t get into that in the weeds here today, but… You think, why does every time the debt ceiling go to be raised, it’s… What’s the phrase, an 11th hour?

Steve Lewit: Last minute, yep.

Gabriel Lewit: An 11th hour deal has to be made, that stresses everybody out, and to avoid… Because in politics, you have to give the impression that you’re “Fighting for your base,” both sides.

Steve Lewit: Until you get into office and take control.

Gabriel Lewit: Right. But even then… So in other words, you’re going to avoid the hard conversations that would look politically damaging for you until you, literally, absolutely cannot avoid it anymore. And then, you can go back to your base and say, “Hey, look, we did the best we could, for as long as we could, to try to fight for this, yada yada yada.” We’re not going to get into the politics today, but that’s what’s happening. It’s turning into a big political match. And I believe we’re not going to see many long-term resolutions to this, probably, until closer to that date.

Steve Lewit: Are you talking about the debt ceiling or the Social Security?

Gabriel Lewit: Social Security, yeah.

Steve Lewit: And the debt ceiling as well.

Gabriel Lewit: Yes. And the debt ceiling.

Steve Lewit: Yeah. So I think people will just talk, talk, talk until it’s imminent that there is a danger here, that is right in front of us, because we are short-term thinkers.

Gabriel Lewit: Yeah. So let’s talk about some of those “Talk, talk, talk” options of what might happen as we get closer. So, one option that’s presented in this article is that the government or the Social Security program will push back what’s known as the full retirement age. Now, what this means, folks, is… You have what’s called a full retirement age. That is when you would collect 100% of your projected Social Security benefits, if you were to start collecting those benefits exactly at that age. For most people today, it’s going to be, say, 67, or between 66 and 67. So what happens is, if you then elect to take your benefits early, then you will get a reduction in how much they will pay you based on your full retirement age benefit amount. So by pushing back the full retirement age, let’s say, to 69, then anybody that, then wants to collect, is 67 will have to get a reduced amount.

Steve Lewit: Tremendous savings. There are tremendous savings in that, folks. But what that… Puts more pressure on each individual to be able to fund their retirement for those two years, or they have to keep working.

Gabriel Lewit: Here’s what’s interesting about this. If I said to you-

Steve Lewit: I thought that was interesting, what I just said.

Gabriel Lewit: I’m just talking specifically about the phrase, “Push back the retirement age.”

Steve Lewit: Oh, okay. I thought you were-

Gabriel Lewit: Hold on. I’m trying to make a very salient point here.

Steve Lewit: Oh, okay. But I said something interesting, and you said-

Gabriel Lewit: We’re going to circle back to it.

Steve Lewit: And you said, “But here’s interesting.” Like what I said wasn’t interesting.

Gabriel Lewit: Do you need a hug?

Steve Lewit: I need a hug.

Gabriel Lewit: I was…

Steve Lewit: Sorry, folks, but…

Gabriel Lewit: If my microphone traveled with me, I’d give you a hug.

Steve Lewit: You got to stand your ground here.

Gabriel Lewit: Okay. So here’s an additional interesting point.

Steve Lewit: Much better said.

Gabriel Lewit: There you go.

Steve Lewit: Yeah, there you go.

Gabriel Lewit: So, what sounds better, Mr. Lewit? “We’re going to cut your benefits” or “We’re going to push back your full retirement age?”

Steve Lewit: Oh, push back my full retirement age. That sounds so much better, even though it’s the same thing,

Gabriel Lewit: Even though it’s a… Yes, that’s the funny part or the… What I was going to say, was the interesting part about that. It’s just a fancy way of saying, “We’re going to reduce your benefits.” Let’s say you just made the full retirement age 70, the max age you can… Then everything would just be a cut for anybody taking it earlier. So just some fancy words that are being used there. But that is one of the options to push back your retirement date.

Steve Lewit: Which is the one I think will actually happen.

Gabriel Lewit: So that’s very possible. Another option is that they increase the income levels at which Social Security gets taxed. Today, there’s an income limit, where… If you’re above that income limit, you don’t get tax any further on Social Security benefits.

Steve Lewit: That’s going to go up.

Gabriel Lewit: And there’s been examples of proposals to raise that, even up to 400,000.

Steve Lewit: That’s correct.

Gabriel Lewit: And so, what is this doing, and effective? It’s taxing higher income earners to pay for benefits of other people.

Steve Lewit: Yes. Okay.

Gabriel Lewit: So that’s another option that’s been proposed. Another option is that they would reduce future amounts of the program, but for younger generations, not people currently on the program, just redo the formulas. So all these different things that they could do and…

Steve Lewit: Then there’s an income tax too, isn’t there? Where if you’re over certain income, you don’t get what you saved.

Gabriel Lewit: Right. So then there could be… It’s called means testing.

Steve Lewit: Means testing.

Gabriel Lewit: So, let’s say you, otherwise, have $500,000 of income coming in, means testing would say, “Hey, you don’t need this anymore. So we’re just not going to pay you as much. We’re going to reduce how much we pay you.”

Steve Lewit: Even though it’s my money.

Gabriel Lewit: Even though it’s your money that you’ve been taxed to pay.

Steve Lewit: That I taxed and saved.

Gabriel Lewit: Which would upset a lot of people.

Steve Lewit: Yeah. Think of it now. You tax… It’s tax money that gets saved, and then it gets taxed again.

Gabriel Lewit: Mm-hmm. Yeah. Or another option is, they raise the percentage of the taxes that are being charged, to people paying into the program, to boost how much can be funded for future people. There’s a joke out there, that Social Security is the world’s biggest Ponzi scheme. Because it’s not fully funded, as we just talked about. And they’re collecting money from younger people to pay older people.

Steve Lewit: Yes. But that’s what…

Gabriel Lewit: A Ponzi scheme is where you collect money from new investors to pay out old investors, because there’s not enough money.

Steve Lewit: Sounds like an insurance company.

Gabriel Lewit: Oh, my goodness. So anyways, it’s kind of interesting. It’s not, folks. It is very safe and secure, of course.

Steve Lewit: Surely.

Gabriel Lewit: You can rely upon it.

Steve Lewit: Surely. Yeah. Surely.

Gabriel Lewit: Sorry, we were joking about Steve… His favorite words. You know how, sometimes, your brain just gets stuck in grooves, and you say the same word over and over again?

Steve Lewit: Surely.

Gabriel Lewit: Yours, lately, has just been the word “Surely.”

Steve Lewit: I like “Surely.” I don’t know why. I don’t know where you got that from.

Gabriel Lewit: We talked about it on the show before. I’m just picking on you.

Steve Lewit: But when did I start that?

Gabriel Lewit: Probably like three, four months ago now. Anything you say to Steve, folks, his answer is “Surely.”

Steve Lewit: Yeah, I say that too… My client said, “Hey, can you send me that?” And I said, “Surely.”

Gabriel Lewit: Yeah. Surely, surely.

Steve Lewit: And then, Gabriel says… My mother’s name was Shirley. So he says, “Deep down, you really just want to say your mother’s name.”

Gabriel Lewit: Yeah. Kind of funny. I know. That’s what it is, I’m sure. Yeah. Surely.

Steve Lewit: You remember Grandma Shirley?

Gabriel Lewit: Surely.

Steve Lewit: Surely.

Gabriel Lewit: Yeah. Okay. So anything else you want to say about this Mr. Lou?

Steve Lewit: No, I think about this a lot. And it’s one of one of those things that what if… And I think it just needs to play out. I think it’s interesting and important to address it.

Gabriel Lewit: And interesting to pontificate about.

Steve Lewit: It is. There are so many different options, but politics is politics. We’ll see which one, actually, drops to the bottom line.

Gabriel Lewit: And the other gist of the article that many of these quotes and stats were pulled from was, of course, the usual question, if you’re eligible today, should you take it now? And that is, again, not a simple answer, because everybody’s situation is very, very different. So we highly encourage you to talk to us about that, or if you have another advisor, and you listen to our show, talk to your advisor about it. But we do a ton of Social Security timing analyses for our clients to help you optimize that.

Steve Lewit: Yeah. Be careful, folks, because they all… Not all, but a lot of the information out there says, you got to wait till 70. You’re going to be better off if you do. And that ain’t necessarily so.

Gabriel Lewit: It is not always the correct timing response.

Steve Lewit: In fact, most often, it’s not the correct response.

Gabriel Lewit: Very much depends on when you work until, and if you’re drawing money from a portfolio. Lots of factors go into that. All right.

Steve Lewit: Yeah. I always find this conversation about Social Security rather unrewarding.

Gabriel Lewit: Because there is no answer.

Steve Lewit: There’s no answer. It’s like… So we just had this long conversation. I feel like we got nowhere.

Gabriel Lewit: Also, about Social Security, as a whole, is when you take the timing question, you know the real answer to when the best time is, depends upon.

Steve Lewit: When you need it.

Gabriel Lewit: When you die. And nobody will ever know that.

Steve Lewit: That’s right.

Gabriel Lewit: So, in hindsight, you’ll…

Steve Lewit: And how healthy you are.

Gabriel Lewit: You’ll only know when the right time to take it was when you pass away, and then you could reassess, “Oh, I should have, actually, waited until later to take this same thing.”

Steve Lewit: You think there’s a reassessment afterlife?

Gabriel Lewit: Where it trues up the benefits? Yeah, I don’t know about that. I don’t think that’s in the proposals. Yeah, I haven’t heard that one yet.

Steve Lewit: Yep.

Gabriel Lewit: Maybe you can write your senators and add that in.

Steve Lewit: Yep. Some somebody will.

Gabriel Lewit: Yeah. All right. I’m going to try to keep my voice here, from…

Steve Lewit: You’re doing good.

Gabriel Lewit: … getting too froggy and raspy for you guys.

Steve Lewit: I think you’re doing great.

Gabriel Lewit: All right. So again, if you have questions on that, we’re here for you. Give us a call, (847) 499-3330, or write us at And we are, of course… Love your thoughts, comments, feedback, if you want us to… We’ve never done this as a topic on the show. If you write in your comments on a topic, we could share those comments, listener comments. It’s like when you read some of the magazines, and they have the listener notes from the prior episodes.

Steve Lewit: Yeah, like, “I agree with this. I don’t agree with that.”

Gabriel Lewit: If you wanted to, feel free.

Steve Lewit: We should do that.

Gabriel Lewit: That’s why I just said it. So you could email us at info-

Steve Lewit: Could you say that again?

Gabriel Lewit: You could email us your thoughts and comments,

Steve Lewit: And we’ll share it.

Gabriel Lewit: Or send us a carrier pigeon with a letter.

Steve Lewit: Will we share it if they disagree with us?

Gabriel Lewit: Of course. Absolutely. We will not cherry-pick. We do not cherry-pick feedback comments here.

Steve Lewit: It’s really true.

Gabriel Lewit: All right, so the next topic I want to talk about is something else… Trending in the news right now, one of your, potentially, it was one of mine back in the day, go-to stores…

Steve Lewit: Oh, it’s still mine.

Gabriel Lewit: … is now closing.

Steve Lewit: I shop there.

Gabriel Lewit: Well, not for long.

Steve Lewit: Yeah, I used to. I don’t know, where am I going to go?

Gabriel Lewit: The store in question that we are referencing here is the storied Bed Bath & Beyond.

Steve Lewit: Yeah. It’s like, this is my place.

Gabriel Lewit: Well, it is going to the beyond.

Steve Lewit: It is.

Gabriel Lewit: Where it’s going.

Steve Lewit: The permanent sleep.

Gabriel Lewit: They just filed for bankruptcy. They had been attempting to stave off bankruptcy for quite a while here, as their stock has plummeted, and then plummeted further, and then plummeted more.

Steve Lewit: And stock prices, and inside the store.

Gabriel Lewit: Of course, there’s such a thing in business, that’s called the death spiral, which is hard to come out of. There’s actually a lot of examples of death spirals in life, but business is one of them where… I was reading, actually, a little bit of research about Bed Bath & Beyond. It’s not in this article I printed off [inaudible 00:20:13], but they were talking about how it started, many, many years ago when there was shareholder pressure, to boost performance of the stock price. And so at that point, Bed Bath & Beyond was fairly cash rich, cash flush, low debt.

Steve Lewit: All they sold, at that time, were linens.

Gabriel Lewit: I’m not talking about what they sold, for just a second, these are… But what they did was, they started spending oodles and oodles, and by oodles, I mean billions and billions of dollars, of their cash to buy back stock shares to boost the stock price, which, of course, had a different impact, which is, then as they started to try to fulfill inventory for their stores, they had to take on a lot of debt, because they no longer had the cash, because the cash was used for stock buybacks. Then what happened is… What happens when you get debt, dad?

Steve Lewit: Interest rates.

Gabriel Lewit: You have to make debt payments.

Steve Lewit: You got to pay the interest, at least.

Gabriel Lewit: Okay. So a lot of your new cash flow then goes to paying back debt-servicing bills.

Steve Lewit: Instead of?

Gabriel Lewit: Instead of boosting your own cash again.

Steve Lewit: Yes. And buying inventory.

Gabriel Lewit: And buying inventory. And then, this can start to spiral, where you realize you don’t have enough cash, so you take out a little bit more debt. And then, if the wrong combination of events occur, and then sales start to slump, this is where you really get into trouble. The moment this occurs in sales slump, these big businesses still have massive debt payoffs. They have lagging sales from competition, from pandemics, from whatever the case may be. And then, they don’t have enough revenue to stock stores. And then, all of a sudden, the shopping experience changes.

Steve Lewit: Yes. Try and find a person on the floor to help you.

Gabriel Lewit: You can’t. So what do they do? They start to cut costs, they reduce inventory. Now, you go to the store, you can’t find anything. They also made a few mistakes, where they attempted to build their own in-house brands to save money, which backfired tremendously, because people used to go there to find brands that they liked.

Steve Lewit: And they went into the drug business.

Gabriel Lewit: The… what?

Steve Lewit: Not the drug business, but the pharmacy business, where they have all the toothpaste and…

Gabriel Lewit: Oh, they have all those little shelves at the front, with all the… Yeah, you could buy… It’s like a little dollar store in the front.

Steve Lewit: Exactly.

Gabriel Lewit: Yeah. So what happens is, these things all collide together, but then the shopping experience changes, new competition comes out, people realize they… Target has a great experience now, for most homes’ [inaudible 00:22:40].

Steve Lewit: Is that where I’m going to go?

Gabriel Lewit: Maybe. Ikea, of course… A lot of-

Steve Lewit: Katie, where am I going to shop for my bed, bath and… Katie shop… Well, that’s the problem. She said Amazon, folks. And that’s the problem with a brick-and-mortar store.

Gabriel Lewit: I’ll tell you, Amazon’s got to be careful now, because I find when you Google something on Amazon… Google on Amazon. It’s funny, I said that. When you search for something on Amazon, I will say, 90% of the top results are always some rinky-dink, low quality, overseas product, with a no-name that I’ve never heard of before, that’s very dubious. I bought these before, and they’re like these pieces of junk stuff. If, all of a sudden, Amazon starts… Not that they’re taking business advice from Gabriel Lewit, but if they start getting known for really poor quality stuff, and that’s all the top results… Just like Google like used to be, nobody goes past the first page. You’re not going to click “Next, next, next” to find your high quality item there. So anyways, I digress.

Steve Lewit: Oh, can I go down that road for a second?

Gabriel Lewit: You surely could.

Steve Lewit: Surely, surely. Yeah. So I was shopping for your… I lost my earbuds. So I was shopping for earbuds. So I go to Amazon, look for earbuds, and I got all these 1499 earbuds. And it’s like, no, I’m a different price… I want quality earbuds. So I had to go to a different website to find the earbuds that I wanted, because they were showing me junk. Now, eventually, you got to the quality one, but-

Gabriel Lewit: If you search by name in Amazon, you’ll find it.

Steve Lewit: You’ll find it, right. But if you just say, “Earbuds-”

Gabriel Lewit: You’re going to get all the really cheapy…

Steve Lewit: You get really cheap ear… And it’s like…

Gabriel Lewit: And it’s the same, any category of stuff. I don’t know if I ever mentioned this on the show, I’m now an assistant soccer coach on Wednesday evenings.

Steve Lewit: Yeah. And our boy did great.

Gabriel Lewit: The best assistant soccer coach, of course, in the seven-year-old space.

Steve Lewit: MVP.

Gabriel Lewit: Coached my son to two goals, this last weekend’s game.

Steve Lewit: You notice how he takes full credit, folks? Your son scored the goals.

Gabriel Lewit: But coached by his father, of course.

Steve Lewit: Of course, of course.

Gabriel Lewit: I lost my train of thought. What was I going to say? What were we talking about?

Steve Lewit: We were talking about earbuds.

Gabriel Lewit: Oh, yeah. So I was searching for soccer coaching stuff to find. And I search… First of all, I went to Amazon. I’m going to buy it on Amazon. I search it, it was all this really cheapy stuff. So what I’m realizing I’m having to do lately, if I want to buy something on Amazon, I have to Google it first, which will then give me, actually, high quality results with real websites of actual companies. Then I find the actual company name, then I go back to Amazon, type in the company name. And then, I can find out if it’s actually for sale on Amazon, not some cheap knockoff.

Steve Lewit: Exactly.

Gabriel Lewit: And it’s just… I digress, but I don’t think that’s good for them long term, in their business model. They should be careful there.

Steve Lewit: But the point is this, is that the online vendors are… It’s really hard to have a brick-and-mortar store…

Gabriel Lewit: Much harder.

Steve Lewit: … because of the online business, unless they are strong online. And Bed and Bath was never strong online.

Gabriel Lewit: Yeah. So why are we bringing this up? As we’ve always said, we like to pick on individuals’ talks. I feel bad for Bed Bath & Beyond, of course. Because I liked the store, used to like the store. I stopped going also, actually, same reasons. But I’m like a perfect case study. I stopped going because the shelves were empty, it looked like an old warehouse, they were old and dumpy. It didn’t evolve with the times.

Steve Lewit: Exactly.

Gabriel Lewit: And then it spiraled down. But the point here is, we always talk about the risks of individual stocks and concentration risk. And we like to share examples of stocks that have crashed to zero. We talked about one a couple shows ago, because it helps illustrate the risk inherent and… Trying to time markets, buy individual stocks, concentrating your money in those is a very risky endeavor. That is a different world of investing. It’s more gambling, truly.

Steve Lewit: Folks fall in love with stocks, Gabriel. I have clients that… I won’t pick particular companies, but I have clients that fall in love with particular stock, and they just think this thing is going to go on forever. And nothing goes on forever. And the question is, when does something come up, that’s a real bump in the road for that business, and then, all of a sudden, it loses value, or it goes out of business?

Gabriel Lewit: That’s what I mean. You look at something like Amazon, and you say, how could this company ever go out of business?

Steve Lewit: Or Apple or UPS.

Gabriel Lewit: Apple has 50% of the phone share. And you say, how could these companies ever go out of business? At one point in time, you would’ve looked at Bed Bath & Beyond, and said, “Wow, they have 8,000 stores across…” Or whatever.

Steve Lewit: How about Sears? Sears was part of our country. It was like rock of the country.

Gabriel Lewit: Big airlines that have gone out of… I mean, you look at these things at the time, you’re like, how could these things ever go out of business? And then, fast-forward 10, 15 years, competition, innovation, big venture capital firms backing other companies, and a combination of bad events, and down they go.

Steve Lewit: Look at Silicon Valley Bank. It’s a big bank and everyone out of business.

Gabriel Lewit: I don’t know if it’s completely out of business. It just had a really bad bump in the road.

Steve Lewit: Silicon Valley… They shut it down.

Gabriel Lewit: Did they actually shut it down?

Steve Lewit: Yeah. They took it over.

Gabriel Lewit: Yeah. Okay. Yeah, they had the huge bankrupt we talked about.

Steve Lewit: Right.

Gabriel Lewit: I think it’s still… Stores are still… Not stores. Branches are still available to go into.

Steve Lewit: But they’re under receivership.

Gabriel Lewit: Guys, what does this mean for you? Nothing, really, unless you happen to have a ton of stock in Bed Bath & Beyond. I sure hope you didn’t.

Steve Lewit: Hope you don’t.

Gabriel Lewit: I feel bad for you if you did. Now, if you still have coupons, you had until Wednesday, which is the day we’re recording this, which would be today, to redeem them, which you’re not going to get this episode until later this week.

Steve Lewit: But that means I got to take a long lunch.

Gabriel Lewit: I had a client yesterday, that came to me. She said, she decided… She wanted to go to Bed Bath & Beyond with her coupons. And she got there. And there was this hours long lines of people trying to use their coupons. So she left, but she said it’s kind of silly, because the reason they’re only using the coupons through Wednesday is because, starting Thursday, they’re just going to have clearance sales on everything anyways. So you’re, pretty much, still going to get massively discounted prices. So that, you can still do, if you get this, and you do want to go get some cheap, discounted clearance items at Bed Bath & Beyond.

Steve Lewit: If you can get in.

Gabriel Lewit: Take advantage of that while it lasts, because there’s usually a lot of people that flood to stores like this, to find good deals when stores like to go out of business… Not like to go out of business, when they go out of business. Now, the other thing they were saying in some of the articles, that’s interesting here, is there is a big lack of new development in commercial real estate right now.

Steve Lewit: It’s a big problem.

Gabriel Lewit: They are saying that the stores that they are vacating will be snapped up, in a second, from other big retail shops. Kind of interesting. Yep.

Steve Lewit: Did they say who would snap it up?

Gabriel Lewit: One of the quotes in the articles was… I think Burlington Clothing was one of them. There’s just so many big stores, obviously, that still are looking for retail space, but nothing new is being developed. So if a thing like this gets opened up, opportunity opens up, because the store closes down. They’re saying, right now, it’s actually going to not be bad for the commercial real estate.

Steve Lewit: Did you know that I knew the guy that started Burlington?

Gabriel Lewit: I think you might have told me that.

Steve Lewit: Yeah.

Gabriel Lewit: Maybe.

Steve Lewit: Yeah, it’s an interesting character. I won’t give you the scoop on this show.

Gabriel Lewit: It’s no longer The Coat Factory, it’s just Burlington, I believe.

Steve Lewit: Yeah, it used to be… These guys started selling coats at discount, called Burlington Coat Factory.

Gabriel Lewit: Just like Amazon started with Books.

Steve Lewit: Right. And I actually had… At one point, I owned three stores, called Oceanside Coat Factory. And the owner of Burlington Coat… You don’t even know this.

Gabriel Lewit: You’ve never owned coat stores.

Steve Lewit: Yeah, I did. And the owner-

Gabriel Lewit: You never ever mentioned this once in my life.

Steve Lewit: And my partner was best friends with the owner, I can’t think of his name, of Burlington Coat Factory. And we spent a lot of time together, because she used to buy coats from my store.

Gabriel Lewit: Are you making this up?

Steve Lewit: Could I make this up?

Gabriel Lewit: How could I have known you for 39 years, and you’ve never mentioned this once?

Steve Lewit: You have no idea what I don’t tell you.

Gabriel Lewit: What is that?

Steve Lewit: I’m your father. Fathers don’t tell their sons everything.

Gabriel Lewit: My goodness. All right, folks. That’s our show for you today. We hope you had fun tuning in with us here. We had fun talking to you, and talking with one another here on the show. So if you got questions about any of this, or just your financial, retirement planning, taxes, investments, really anything that we can help you with whatsoever, give us a call, (847) 499-3330, or go to, or email us at Those are the three ways you can get ahold of us. Otherwise, we hope you have a wonderful weekend.

Steve Lewit: Enjoy, enjoy. We might get some warm weather.

Gabriel Lewit: Yeah, it’s a little cooler. I keep seeing… Every day I wake up, and I see just a couple little snow flurries. I’m like, what the heck?

Steve Lewit: Yeah, summer came and gone.

Gabriel Lewit: Yeah, it came for a weekend and left. Now we’re back. But it warms up. So it’ll continue to get better.

Steve Lewit: Stay well, stay healthy.

Gabriel Lewit: Stay well. Have a wonderful weekend and a wonderful week.

Steve Lewit: See ya.

Gabriel Lewit: Bye-bye.

Announcer: Thanks for listening to Our 2 Cents with Steve and Gabriel Lewit. For any questions about your finances, give SGL a call at (847) 499-3330, or visit us on the web at And be sure to subscribe to join us on next week’s episode.

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