Navigating Currency Risks in International Trade

Machine Automated Transcript:

Folks, we’re in for a simply trade podcast show that’s going to be a really good one this time. You know, we have a lot of good shows are up and down, but this is going to be something that we haven’t had a good discussion on. And we’ve got an expert that’s going to come on to plays dealing with whenever you’re buying and selling. You’ve got international transactions here. There’s usually currency exchange in that. And with that, it’s we’re going to get into some nitty gritty on what to look for and the industry and whatnot. But Lala, I’m excited about this one. This is going to be a cool discussion. I think

it is. And unfortunately, I’m so clueless about this topic. I mean, it’s, I know it’s, it’s a factor or a something that importers exporters need to be aware of when they’re getting paid or when they’re paying the closest I can think of. And this is might be a little joke or not, but, I mean, it’s somewhat true and and our guest is probably going to say, No, goofball. That’s not has nothing to do with it, but, but, but, but this is the closest I can get to is I live on the border here in El Paso, right with Mexico. I remember when we were little kids, and we would go a lot to Mexico, my dad and mom, their families in Mexico, of course. And we would, you know, it, this is the only difference between El Paso and Juarez here in the our our neighboring city in Mexico, is that there’s a border, you know. Basically it’s one big community, you know. So, so it was interchangeable. We go visit aunts and uncles and cousins and all that, you know is like, if we were going down the block, right? We just happened across the border, but I remember this very clearly. We had dollars, and we had to exchange them into pesos. I remember my dad’s like, No, this one’s too high. No, this one’s too low. Oh, no, we’ll get a better rate here. We’ll get a better rate there. So that is, like, my best analogy I can think of. And again. John may, may say, no, no, no, dudes, that

up really. Well,

okay, great, awesome. Okay, so on the show, Andy, we do have John. John min, he came to us via our friends at NCB, FAA. Thank you very much for for suggesting him as a guest. But John, I mean, Andy, I don’t know if you you may have another kickoff here to this or not. Got

Well, I’ve got, I’m geared up for it, but why don’t you, or John, welcome to the show. But why don’t you tell folks who you’re working with and your position and what you do.

Glad I’m here is happy friday from Washington, DC. I’m the chief nerdy economist for Monix group, and that Monix group consists of three businesses, Monix USA, Monix Europe, Monix Mexico. In fact, if you go to Mexico City, go to the financial district, the most beautiful building there is about 24 stories. Is our building, and all three business units combined, we have about 3000 people around the world, and we focus on only one financial asset, which is the foreign exchange. There is a risk management aspect of it, so we can help you hedge those volatile currency movements. And the second part is payment side, we are very good at delivering funds from bank account A to bank account B. That requires conversion. Typically banks, it takes about two to three days for the money to show up in euros or the pound or the yen. With us, it takes about 24 hours, and I think we’re the only one. I take it back next to JP Morgan. So we’re one of two or three financial institutions United States where you can get in contact with us Friday at 430 and we can have your Mexican peso in local account in within 30 minutes. So that’s what we do. But we’re very excited to be here because we work a lot of freight forwarders, custom brokers, wine importers, food importers, machine tool companies that buying parts from around the world. And of course, we also work with bigger companies, enterprise companies, because they got offices around the world. They got to repatriate their profit, or they need to make investment overseas. And we get involved in all sides of transactions.

All right, John, so the one thing that I’m excited about when I hear that you’re you’re calling yourself the nerdy economist. I love to talk about the cause and effect. Now, listen, you may have to draw me a picture. I’m dumb as a box of rocks, and as we go through some of this is there are things that I see as we get into this. Is that? Okay? Let’s talk about this a little bit more, the more you understand, in my opinion, of you know, the intent. The situation, the structure of business, if you will, and all the the better you would have to take advantage of opportunities that are out there in the business transaction. So we’ll get into some of that. One of the things as far as the exchange rate, I will say that as we’re going through, you were talking about minimizing the risk. So let’s, let’s first talk about, let’s take a a standard transaction that somebody is, in this particular case, you’re saying you’re dealing with freight forwarders and all that. I’m looking at it. Let’s just say that I am a distributor in the US, and I have come across a product of some kind that I am going to buy this product, let’s just say it’s from Europe, for right now, whatever this widget is, and I’m getting it from a factory, and I’m going to buy a lot of it, and I have a purchase order out there, so let’s say 100,000 units, and they ship 1000 units at a time, all that. So with that, help me finish out the scenario of what you normally see. I mean, is this something that? Alright, let’s say it’s Italian lira and and it’s, that’s what the the, you know, the It’s an Italian company, or they’re selling to me, or I’m buying it in Italian lira, or should I buy it US dollars? Or where should I go? What do you normally see in contracts here?

Got it first of all. Andy, I think you’re dating yourself the eternity, as

long as a turtle’s tail too.

So, but I’ve been doing this for 30 years. I remember the day sitting at the trading floor when all these beautiful local currencies disappeared, the Euro emerged. An idea was for the euro to act as a counterpart to the US, because we didn’t want the rest of the world didn’t like the US dollar dominance. So anyway, that being the case. For a

while, I missed the news that there was a What is Brexit? Italics, it or

something. That’s one of the reasons why we had a Brexit, because they want to have a national currency. But, you know, the pound never joined the euro in the first place. It’s an island economy, and they so we got, still got the pound. We got the Swiss, which is like an island, middle of EU, but we got the euro, which is now the common currency in Europe. But now going back to the situation, the importer, in this case, distributor. Number one mistake that we find a lot by American importers is like, I don’t want to deal with foreign exchange. I can’t figure out this numbers. They look foreign to me. Calculation is off. Let’s just do in dollars. So they tell the supplier overseas, you know what? Just invoice me in dollars. Let me pay you in dollars. I don’t have to worry about this. The problem with that is this that’s almost like walking into 711 and getting a gallon of milk knowing that you it’s double the price going into grocery store, because there’s cost of convenience in this case, yeah, it is convenient for you to send dollars, but we what we see is typically a markup. There’s cost at a convenience, anywhere from five to 10% and the main reason is, if I’m the supplier in German, in this case, and they’re going to pay me in dollars, let’s say in 30 days, 60 days, 90 days, well, within 90 days, it’s like a lifetime in foreign exchange market, because dollar euro value could fluctuate, usually fluctuates anywhere from five to 7% so to hedge myself as like an insurance policy, I will price it and then I will mark up seven to 10% extra. You want to pay me in dollars? Fine. You have to pay 10% more in dollars, so that, in case the market goes against me, I am covered when I converted to euros. Now it’s 5050, chance, right? 90 days from today, I get the dollars. And I said, Oh, my God, the Euro weakened during the past 90 days. I’m doubling my profit, but I’m not going to tell you, but if the market goes the other way, that dollar weakens significantly, and by the time I get the dollar and I don’t recover my original price that I was expecting in euros, we also see this that we invoice you and say, up, sorry the dollar has weakened. You got to make up the difference. But they never rebate you. So our recommendation is the best practice always deal in local currencies so you eliminate that markup. And easiest way to do that is you just tell the supplier, build me in dollars and euros. You. We call it dual invoice. And when you get the invoice with the euro and dollar, you just divide the numbers together and you know, and you compare to where the current spot market is, then you know exactly what the markup is, but you will definitely save more if you pay in local currency versus the dollar. Well,

that’s where I was going, is that. So the takeaway from, based on this discussion, is to deal with local currency, whether it’s the euros or where whatever country you’re dealing with, all right, so that’s, that’s a key thing, and with that, you can then watch that fluctuation when it’s time to, you know, pay the invoice, if you see where the dollar is strong, it’ll take less dollars, in a sense, to pay for that. So Alright, so here’s the other good so if, if I, let’s say that I get an invoice in euros, then I should pay it in euros. Is that right exactly now? And doing that is where I would go through, a company like yours, a bank like yours or something, right?

Well, in United States, our market share is still relatively small. When I say ours, non bank entities like

fintechs like us, if you go to other side of the pond. Pretty much all the companies I know, they deal with fintechs or money service business, because they’re more sophisticated when it comes to foreign exchange, because they’re used to converting money. But in United States, most companies are in in the mindset of FX. I just go to my bank. We call it the monopolistic relationship. You go to your bank and whatever the numbers they give you, you make the payments. Now, one thing that everyone should know, this is the second most common mistake people make. So they need to make Euro payments, but they don’t realize all foreign exchange transactions are over the counter, that’s the technical term, which means they’re negotiated. So if you go to three different banks, you’re going to get three different pricing for the same transaction. If you go to three different traders within a bank, you’re going to get three different pricing. And less sophisticated you are higher the markup the banks will place on you. And the worst time to do it is Friday afternoon, calling from the airport on your cell phone, I need to send 100,000 euros to your branch manager. Oh, watch out, your markup is going to be huge. And if you are just interested in these markups, just go to Google. Type in FX rate scandals. You see all these banks getting caught because sometimes they mark up just too much. But that being the case, there’s no one price rule, and the foreign exchange market is not regulated by any government entity at all, globally

or medium sized company. And I’m dealing with, you know, large companies usually have, you know, their internal accounting processes they may have, you know, and they deal with that and saying, you know, they’ll pay for locally, in their own, you know,

account overseas, they can use that, or they can have multiple banking relationships. So you can bid it out if you want a smaller company,

well, in the smaller, medium sized companies in dealing with this. So it sounds like, again, the second takeaway here. One is, as we just said, you know, purchase your goods in using the local currency. Second, when it comes time to actually paying that, you can shop that around a little bit here and all that. And as far as and how to do that, we’ll talk through that. But basically you’re saying you can talk to different financial institutions or brokers or whatever that to, I guess, zero in on what would be the best company to execute your transaction. If I got that right edge, like, maybe I’m okay, all right. So the results of that though here, here’s what’s key of what I’m hearing you now again, you know that’s where I’m trying to make sure I’m trying to understand this as we’re going through this. This could be a situation where you can dramatically improve or decrease your profit margin in this or, you know, dramatically raise your cost of the transaction or minimize that cost which

goes to your bottom line directly. Yeah, in fact, there is a professor at NYU to stern their business school. His students, they do annual survey of the average profit, well, gross margin for different industries in United States. If you are distributor, wholesale distributor, your margin is about 10 to 15% That’s the average. But in the foreign exchange market, just comparing rates among different financial institutions, you could easily save one to 200 basis point. So if your profit margin is 10% and you can say 200 basis point, that’s 20% improvement in your bottom line, just by doing the transaction with someone who’s willing to give you fair and competitive exchange rates, not we call it jokingly, retail rates. So some last thing you want to do is go to bank branch and then do the wire transfer. Those are like two to 300 basis point above where the market should be on $100,000 you’re literally giving $3,000 to a bank, plus your wire fee.

Lord Edwards, okay, this is good. All right. Lalo, forgive me for jumping in there. But all right,

what I was gonna ask John is, so why is it I mean, again, very naive. I this is very new to me. But why is it that we see a published exchange rate? Is that, just like a suggestion, no,

no, so in the foreign exchange market is world’s I mean, this is the largest financial market in the world. It’s about $8 trillion a day per day. They spot and sold 24 hours, seven days a week, and out of 27 trillion, about 93% of it are hot trades. We call it hot money. These are currencies being bought and sold by pension funds, hedge funds, big traders. They’re just moving money, buy low, sell high, just moving money all day long, and that’s how they make money. Now, for those guys, we call a wholesale rate, so inter bank rates, that’s technical term. Those are the rates you see on Bloomberg on the websites. So that’s like the benchmark rate. But in order to get anything close to that pricing, you got to do about 30 to $50 million transactions, like every day, because now you can play the wholesale Now, if you’re a small business, typically your invoice is anywhere from 30 to 50,000 per container of wine or whatever it might be. You’re not going to get that rate. So that’s why there’s a markup. And that markup, there’s no rules to what the markup should be. Less sophisticated, higher the markup that I know because it has been documented.

And so hence, I guess, the how I kicked off the show my when my mom and my dad, when we would go and we would jump from Exchange house to an exchange house, because one would sell it higher or lower than the other.

Okay, okay. Now, by the way, the one place you should avoid is a Heathrow Airport exchange. Your markup is your markup. Your markup is 12% that markup is 12%

it’s like, unreal. It’s like, you know, I can remember having, oh, I need to get some pounds. Oh, no, I’m not doing it here, pounds, and I want to convert it back over to us. And I’m looking manton. No, you know that. And hotels, hotels at the front desk,

well, because hotel makes money, and whoever the provider also makes. So we have a double markup on that one. Oh, good to

know. I’m going to, I’m going to Heathrow in September’s

go to the ATM. It’s going to be about 2.5% on a ATM car. Wow.

Okay, cool.

All right. So here’s something, as we’re going through and talking about it. So it’s, I love this discussion. Let’s, again, I asked this question, where you’re trying to minimize the risk. So when you’re talking about minimizing the risk, are there, you know, one thing you’re saying minimizing the risk as far as your your profit and loss, or your added cost or whatever. So you want to, you know, obviously whoever you’re doing the transaction with, you’re trying to maximize your benefit on the exchange. That’s one thing. Are there any other things in the trying to minimize the risk? Are you as a in doing your this financial transaction? Are there any vetting of the entities, of the you know, the people in the financial transaction here, are you doing anything that kind of stuff?

Well, our counterparts are the world’s largest banks, so we buy and sell to each other in a bulk. So that’s it. Now, for small businesses in the US, if you’re looking for financial institutions, banks are safe because they’re heavily regulated, either at state and the federal level. One thing you should be you should watch out for is that out of 4300 banks, about 4200 banks, they don’t do their own foreign exchange, so they’re resellers of bigger banks. That’s the worst case scenario. So if you’re sitting in 10. Texas, you’re dealing with the Community Bank and regional bank. 99% of the time you’re dealing with Wells, Fargo, US Bank, JP, Morgan, we call it corresponding banks. They’re the ones who is actually doing it. Now, from wells far corresponding banks perspective, it’s not really their customer. So there’s already a markup. That’s huge. That’s one, number two, depending on the relationship they have with the Community Bank. Community Bank also wants to get a cut, so they add their markup. Therefore sometimes you pay three, 4% above what you should be paying. Again in dollar terms on $100,000 invoice, that’s three to $4,000 hidden fee. By the way, when you get a bank statement at the end of the month, a lot of the small businesses, the banks, will do the analysis to kind of say your wire fee is this or that, but they don’t show you the exchange rate. It’s hidden.

Interesting, interesting. So,

yeah, if you call your bank to say, I want to see the exchange rate, some banks will actually charge you for it. Oh, wow, because they had to pull a special report.

Well, to that point, I will also say, I guess in looking at it, this is one of those things is from an accounting perspective that you know, gives some thought to the services that a your financial institution that you’re using is offering to you. So if it’s kind of buried in there, the chances are they’re not really a big player. They’re, you know, in that secondary or Treasury market. So it’s like, okay, maybe I need to, you know, it doesn’t mean that everything has to go through there, but your international transactions, you want to deal with the big boys or the key players. It sounds like yeah, Andy,

but here’s another drawback, another challenge for small businesses, let’s say you realize I need to shop around so you’re going to call another bank in your town to get the rates they’re not going to

quote you because you don’t have a bank account with them. So in order to get a second provider,

quote you because you don’t have a bank account with them. So in order to get a second provider, let’s get a second quote. You need to open up another bank account, and you know, that’s a very painful process, so you’re kind of like captive to your bank. That’s why fintechs like us exists, because we’re not a bank, but we are less licensed by 50 state banking commissions just to do the foreign exchange international payments part. So your credit line, everything stays exactly the same with your bank. You only use us for the FX transactions, and we can onboard you in four hours. That’s excellent.

Well, I’d say again, this is one of those where folks we’re going to have, excuse me, we’re going to have John men’s contact information here. So if you have any more questions, I’m sure you know he, can, you know, answer you, or get you the right party or entity as far as to answer your questions. But as we’re going through this, all right, there’s another thing is that does your in these international transactions? Let’s say that I’ve done all I need to do, as far as I’ve got a contract, I’ve got a factory, I have vetted people in the parties to the transaction to say, are they on the denied party screening list? Are they on the restricted party screening list? And done all that. Say, now we’re down to the actual nitty gritty of the actual transaction. Is there anything that you’re doing in the background of saying, is this a good entity? This is a good person to do business with, if you will, or is this is somebody listed on a government list. That is

not that that is down 100% every transaction we do. KYC, know your customer. AML, potential money laundering and behind the scene, there’s various list of terrorist list countries where we can then send the money. And we have to abide by that, because our license at each state is dependent on us passing annual audit. If we do any type of transaction where money shows up in North Korea, we could lose our license. Alright,

well, I get that. So here’s where I was going with that. Is that now let’s say that I’m new to this deal and into international transactions, or I’m up and coming. I’ve got taken over, and I’m looking at this going, Hey, we need to do a better job of vetting internally to our company. I want to make sure that we’re crossing the T’s and dotting the i’s as a good corporate citizen in that. Is this something where I could reach out to, you know, your company, and say, hey, I want to make sure we’re doing things right. So I don’t want to go through this situation, send you a financial transaction and all sudden you flag it, going, Oh, wait, wait a minute, we got a problem. Is this something that I can align with you, or you with us? And saying, Is there a way to. Update my information using your information or something, how to make sure?

Yeah, that’s automatically done. And just give you very specific example. Let’s say you finally get an invoice from overseas and you want to put the beneficiary information into our platform. Obviously, they have a different they don’t have a fat routing number. They have IBAN and different numbers. So you put that in well, behind the scene, we verify that is a legitimate bank account, and we pre approve, in other words, we don’t send out your funds. We actually ping to make sure that it is who you think it is. And once everything is verified, then you’re good to go. Say,

Hey, folks, listen, John’s given some great advice here. But this one, right here, is one of those, even in the midst of international transactions, this is a key factor that, basically, if I’m using your services,

in the midst of international transactions, this is a key factor that, basically, if I’m using your services,

you’ve got my back. You’re you’re doing some checking for me on my behalf. I can tell you that I have consulted with some of my clients in the past that were doing some business. They had been working on a deal for 18 months. Had two different law firms involved. Supposedly, everybody was vetted and all, and it was coming down to the supply chain and all that. And I happened to be brought in at the ninth hour, if you will. Hey, we just want to make sure all this is coming together, you know, right? And all, long story short, I mean, within the first two days, I’m reviewing information, and I’m going something doesn’t seem to be right. Are you sure these folks are good? And it was dealing with a company out of South Africa. And in Long story short, I went and they said, no, no, we’ve, you know, two law firms. Everybody’s Great. 18 months, you know. I said, have you provided any money? And there was a $350,000 deposit. And it was a multi million dollar deal. It was a $350,000 deposit sent to a neutral bank that was holding it before all the transactions were taking place. And within five days, I’m going, something’s not right here. And so I had my own red flags and go, you know, all that. Long story short, again, out of this, I will say that what we discovered was that there were people that were presenting inventory for in this case, it was PPE, it was protective personal protective equipment, gloves and masks and things. And it turned out to be that they had some old inventory that had expired, and they were presenting it as we got these, you know, 10s of 1000s of boxes and everything, but it was just smoke and mirrors and and all that. And it took them probably nine months to get that $350,000 back. In the midst of that, I was going, you guys are trying to handle this on your own. I would have gone through, you know, somebody like yourself, just to say, is this a legitimate entity? And it turned out it wasn’t. But, ah,

now we only focus on the payment side. Right? Verify the bank account. We verify it is good. The money will get there. Now, if there’s any fraud that’s related to business side, that’s outside, right? And

it was, it was one of these that the account itself, that finally, that they were trying to get payment to was like, set up real quick and all that. And it’s like, you know, something’s not right here, you know, folks Exactly. Yeah. So anyway, all right, that said. Now, let me ask you another question. The issue with, like, sanction. The US has got sanctions against a lot of Russian entities, you know, Iran, North Korea, all those kinds of things, and that stuff is added sometimes, you know, very quickly, or new, new additions, all that. So as we’re going through that, that’s, again, something where you’re you’re staying probably current with the most recent additions and changes, aren’t you?

Yeah, we stay almost real time current, and in fact, one of our largest team here is the compliance side. We just need to make sure that we’re a by biting every regulation and law that’s out there, and that’s why we get audited. And we have a running job. They were running a bed and breakfast because we got bank examiners coming in from different states. It’s crazy. We have to pay for their hotel expenses and meals, and they spend three four days in a bubble. We have a special room. They go through every transactions to make sure that we’re not sending money to Russia in a way or the. Sanction company, or whatever might be, and we have to pass that in order to maintain our license. So in many respect, we’re risk averse. If there’s any gray area, we don’t take the chance, because once we lose our license, then we can operate as a money transmitter. All right,

so now I’m going to throw you. I’m going to change directions here. All right, let’s, let’s back away from this situation for a moment. We hear about the BRICS initiative, Brazil, Russia, India, China,

Saudi Arabia and some others that are striving to not use the US. Dollar is one of the international currencies for exchange. From your perspective, how do you deal with that in terms where you know, people are asking for, you know, the contracts and they want to be paid and whatever you know, I guess it’s still the local currency scenario there, but trying to avoid the US banking systems, or the Western banking systems and things of that nature. What’s the impact of that on on things?

Actually, there’s no impact at all. Because, if you remember, I said it was $8 trillion a day that’s bought and sold. Dollars involved about 20, about 80% of it. So other 20% dollar is not involved at all. So our counterpart, our sister company, in London, they sell pounds for their customers and buy euros. Dollar is not involved. They sell pounds and they buy yen. Dollars not involved. Non dollar trace, as I call it, is growing. You’re absolutely right now. Implication with that is we do think in the long run, dollar would get weaker. Right now, dollar is very, very strong, because if you want to buy any commodity products, globally, 99% of the time they want dollars. So there is a built in demand for dollars that makes that dollar very, very strong. So that’s why the imports into United States has been surging lately, because you really do get a great deal if you pay for things by selling dollars and buying local currency to pay your suppliers. Now this, this is a separate topic. We’re already looking into this, but we can’t get into it. I mean, we can just flip the switch using stable coins, crypto, Blockchain, you can move money instantaneously around the world. So Brazil has a capital control. China has capital control. Argentina has a capital control. It’s really hard to bring money in and out. It takes weeks. Sometimes you got to do extra paperwork. With crypto technology. No government can get involved, and it will be done instantaneously, transparently. So in theory, we’ve been working on this project. You can sell dollars but stable by stable USD, and then use that to buy stable Indian rupee. And then on the other end, they can sell stable Indian rupee and convert it to local Indian rupee. Their whole transaction will take only 20 minutes. Outside we can do it and we actually prototype. Only problem is we’re waiting for clarification on regulation side, and we don’t know when that’s coming.

Well, regulations are usually way behind.

Yeah, we’re ready to go last year, but we’re still waiting. I know there’s a bill that’s going through the Senate as we speak that’s tied to marijuana, the decriminalization all that, but it’s still very far away.

So what about freight forwarders and the brokers and all of that in your focused on, you know, a key element there where you’re supporting or providing services. What are some examples of how your services are used with the freight forwarders at all, so

particularly in the intermodal side, so you’re moving goods that requires different modes of transportation. So as a freight forwarder or relocation company United States, I take the goods from us, or household goods, and I’m shipping over to Germany. But in order to make that happen, you have to pay a shipper. That’s usually in dollars, but someone has to pick it up on the other side. Now that’s a Euro, and then it has to get on the truck, so that’s a Euro, and someone has to unpack it, deliver it. That’s also Euro. So these custom brokers, the relocation companies, they get all these foreign invoices every month. And when you put it all together, we’re looking at a couple 100,000 $2

million worth of obligation. Now here’s the problem, though, you get this invoices. You have 30 days, 60. Days before you make the payments, if the dollar is gaining strengthening, that’s good news for you. You’re getting discounts. But if dollars weakening or weakens, then those bills getting more expensive. And that’s the risk that’s involved with dealing with the local currency, the market volatility. We call it foreign exchange risk, but we can eliminate that by saying we can guarantee a rate today for 30 days, 60 days, 90 days, up to two years, by the way, and you don’t have to pay for it, but we just lock it in. That’s known as a forward contract, and lot of our clients use forward contract to just eliminate the hassle of his dollar going up, dollar going down, we guarantee the price that you’d like at that moment, and we lock it in, and you pay us later when you settle. So that’s the forward benefit

of that is that it is, from a planning perspective, I don’t have to worry about this up and down, but basically you’re taking on that risk of the up and down

right. And now we can take one step further, which is, well, okay, let me lock in the rate for 90 days out so I don’t have to worry about it. But what if I have us regret 90 days from today, because dollar is doing so well, and I have to buy it at the price that I committed to three months ago, and I’m missing out on what’s happening in spot market. Well, at that point we can offer optionality to it. We guarantee a price for 90 days, but the 90th day the dollar is very well, you can just walk away, if you want, and just buy it off the spot. By the way, that’s options contract, very simple, plain options contract. So a lot of our clients start using us on a spot transactions, and then they want to manage the risk they go to forwards. And then, more sophisticated companies, they use optionality to give the flexibility to say, hey, if this sun is shiny 90 days from today, I’m going to take advantage of it. But if the Dollar weakened dramatically, is raining hard, then I’m protected. I got the umbrella. That’s the optionality. Well, at

one point we got, we got like three more minutes left, just so you know. Okay, yeah, three to five minutes? Yeah?

No, I was just gonna say that. I, at one point in my career. Well, I had several different things where I was having to, I was dealing with mitigating some penalties on a global basis. I was dealing with some claims against bonds on a global basis, and so having to literally pay foreign governments or different entities. And I was watching it, and I was literally was saying, Okay, let’s hold this. It looks like the dollar is weakening a little bit. We need to hold off a little bit and see what happens. And then I’d have a drop dead. It’s like, I, you know, let’s we just have to bite the bullet on this. Well, usually it would come, you know, it fluctuates, like you said, and then when it searched over, like, do it quick?

No, no, no. Actually, we call it Kmart. Is it Kmart? Blue light sale?

Yeah. There you go. There you go.

We have a dedicated account managers. When dollar rallies significantly, we let all our clients know it’s like, Euro is on sale today. Yen is on sale today. Sometimes you can save another 120 50 basis point, and that’s when you lock in for your future obligations, right?

John, any final recaps here for our audience to in dealing with it. I mean, one is paying local currency. Two is the, you know, utilizing your shop around as far as your your the for the transaction, sounds like your company is a key player in that. Three is just keeping your eye on the market, as far as those kinds of things like you just mentioned. And four is that you’ve, this is another in your companies is a good entity to have in your arsenal in protecting yourself to make sure you’re not doing business with somebody that you know from a bad perspective on the financial transaction side of things,

you summed it up really well. That’s pretty much yet. That’s the lesson for today.

No, I love it. Well, folks, I’m telling you, we’re going to turn this back over. John, what a pleasure to talk with you. I would love to get into some more things at some point, and maybe we can have you back and we can get into some more economic news. It’s like, you know what if, cause and effect, all that kind of stuff. So it’d be great to do that. Lalo, anything from you?

No, I actually, again, being naive. I had some other questions. And John, we definitely need to have you on I wanted to get, like, lessons learned from covid that maybe be helping you now, because of all the geopolitical stuff. Of you know, because in logistics and in transportation in supply chain, let’s just summarize it through that in supply chain, we’ve learned a lot of lessons through covid that now like this, like the geopolitical issues that are going like, like the attacks in the Black Sea or in Black Sea or Red Sea, Red Sea, Red Sea, Red Sea. The attacks on the Red Sea are not affecting the supply chain as much because of things that we learned from covid. You know that now our supply chains are more resilient, etc. You know, I’d like to know more, a little bit more about the resiliency of the financial markets as well, you know, just because of things that we might have learned. But we’ll save that for the next show. Got it.

John, thank you, sir, folks. Hope you have a great day and like us. Share us. Please, please, please do that. We are growing in popularity because of your listenership, and we just love that, with all due respect to everything else on that. I hope you have a fantastic day. You.