Description

Everyone’s throwing around the word recession—but what does it actually mean? And how do we know if we’re in one… or headed for one? In this episode, we break down the real indicators economists look at (like GDP and unemployment), the not-so-obvious ones (consumer confidence, anyone?), and why vibes sometimes do matter. If you're confused by all the mixed messages about the economy right now, this episode will help you make sense of it all—without the jargon.

Reach out to Kelly Turner at kturner@totalmortgage.com and Derek Mazzarella at dmazzarella@mygfpartner.com

Hosted by Ausha. See ausha.co/privacy-policy for more information.

Transcription

• Speaker #0

  All right. Welcome to another episode of Millennial Money Matters with Kelly Turner.

• Speaker #1

  And Derek Mazzarella.

• Speaker #0

  Hi, Derek. How are you doing?

• Speaker #1

  I'm doing great. You just got back from Aruba and eight other trips in the past three months, so you must be doing fantastic.

• Speaker #0

  I'm doing fantastic. It was very hot in Aruba. It was very windy in Aruba, but it was a delight. I'm home.

• Speaker #1

  Yeah. Well, time away from the kids is probably nice and relaxing. You probably had a margarita or two in your hand.

• Speaker #0

  And bojitos were actually my beverage of choice.

• Speaker #1

  That's nice. Yeah, that's a good summer drink.

• Speaker #0

  Yeah. And it felt like summer. But I came home deep in the thick of I had to register my kids for after-school care for next year.

• Speaker #1

  Naturally.

• Speaker #0

  You do that in March.

• Speaker #1

  Yep.

• Speaker #0

  And also trying to prepare for summer camp and all the other things. And there's just a lot going on this time of year. And baseball started.

• Speaker #1

  Oh, yeah. Yeah, we did that. Yeah, my wife has this, like, God bless her. She's like this matrix of all these camps that she has to sign up Harrison for. And it's like, I don't know how she even keeps together. So my kids would literally be going to Camp Derek. Yeah. I sat in my office all summer if it weren't for her.

• Speaker #0

  You're like, sit on the couch and don't move.

• Speaker #1

  Yeah, yeah. Yeah, just here's an iPad. But yeah, so we got an exciting topic today. What do you want to talk about today?

• Speaker #0

  So the big question, and we've seen it across news articles. It's in the newspaper. It's all over the internet is, dun, dun, dun. Are we in a recession?

• Speaker #1

  I don't know. Well, maybe I do know. I don't know. You know, it's very interesting. So the question is, we're definitely not there right now. But the question I've been getting asked a ton from clients, especially, is are we headed for a recession?

• Speaker #0

  Are we headed for what? And I think we've been asking this question for like two years now.

• Speaker #1

  Well, yeah. Well, I think we kind of in 2022, it was like everyone predicted a recession and it didn't quite happen. It was like just there because the general definition, like the back of the envelope one, is two negative quarters of GDP growth. So GDP is like all the goods and services we produce in the country. Like, how are we doing healthy-wise from that standpoint? But really, it's like all these other factors because the economy is more like soup. It's not just one thing. It's like all the stuff just jumbled in there together. And then that kind of makes the economy. So you can't just say like, oh, look, there's no broth. That means there's no soup. Yeah, there's like all these other things that go into it.

• Speaker #0

  Yeah, there's a lot of moving parts. And one part could be doing really well and another part be doing terrible. And that's still not a good indicator that things are great.

• Speaker #1

  No, because I mean, every you go back to like all these recession predictors, right? And it's like, oh, and this happened, we had a recession. And then when this happened in like 2000, we had a recession. When this happened in 1976, we had a recession. So it really, it really kind of moves. And we haven't had a really good, accurate predictor consistently, because even the most accurate one was the yield curve when, and not to get too complicated here, but I'll explain it quickly. The yield curve is basically like, when you borrow money for a short timeframe, you should be paying a lower interest rate than if you borrow money for a long time. Yep. Right. So when it inverts, when you're actually getting a higher return for holding your money even a shorter time than the longer time, they're like, oh, it's typically a good recession indicator. That triggered in 22, nothing happened.

• Speaker #0

  Nothing happened. Yeah. And we didn't like that on the mortgage side. That impacts us on interest rates. So it wasn't great on that end. But I think there's been so much talk about this soft landing, right? If we were going to work with inflation, we needed this soft landing to a recession. And I think it's been very confusing for people. I'm like, oh, my God. Are we in one? Is it happening? Is it coming? When is it coming? How do we know it's coming? And I was actually listening to a news article the other day on my phone, and it was talking about how it's so hard to know right now because our economy has changed so much since 2008 that those indicators may not be accurate at all anymore because what equals financial health today is different than it was in 2008.

• Speaker #1

  Yeah, I mean, even when you look back even longer ago, I mean, we were a really manufacturing economy. So if we had a supply issues or all that stuff like that would just created the economy or like the oil shock of like the 70s. You know, that's like, oh, we can't make anything more. Oops, sorry. We're going to lay off half the manufacturing workers. But now we're such a service-based economy. It's just so different now. And it's so hard to predict just because there's so many different influences now that go into it. Plus, you know, you got to factor in the government's getting really involved, whether that's the Federal Reserve. pumping money into the economy like they did starting in 2008 or you know buying a bunch of bonds so they call that uh quantitative easing we don't need to get into what that is at all because no one sentence too yeah yeah it just sounds really important right they're just buying the death star quantitative easing that just means they're buying a ton of bonds um so there's all these different things that like we're putting thumbs on the scale for in terms of the economy whether that's political or whether that's the federal reserve or just kind of the different makeup that we have in the economy. So it's a little challenging. And I think a lot of this stems from, for me at least, like this is actually the time of year when I do a lot of my reviews with clients. lo and behold, the market's down this time. So I look a lot dumber than I was six months ago when I was doing reviews in the fall, the market was going great. So I think a lot of people thinking, okay, the stocks are down. So it must mean the economy's in trouble, right?

• Speaker #0

  Yeah, obviously. That's what I would think. I have less money, things are bad. Yeah.

• Speaker #1

  And I think the one thing that's important to understand is, first of all, the stock market is not the economy, right? So they're two different things, but the stock market is an indicator of how the economy is doing. And one of the things that people want to look at when it comes to the stock market is it's trying to be future looking. So it's trying to price in, okay, what's going to happen in the next 6, 12, 24 months?

• Speaker #0

  But who's figuring that out?

• Speaker #1

  Like who's guessing that? The people. Well, it's a common, it's basically, it's kind of like voting with your dollars. That's kind of way. So it's basically, all right, they call it, you know, the smart money, quote, unquote. Like it's all the money managers and all the hedge fund people. They're basically betting on certain things happening with the market in the future. So they'll like see the news and say, okay, XYZ is coming down the pike. That's either going to be good or bad for the market. So they're trying to price things out in the future. And I think it's important to know going into this year, we were pricing in perfection. So we were pricing in companies gaining a lot of money over the next few years. They were pricing in interest rates dropping. They were pricing in a healthy economy. So when any of those things come under play, it's like the Jingo thing. Like, oh, we're just sliding an extra block or two. And what's going to collapse out of that?

• Speaker #0

  Yeah, what's going to be the big thing? And I think the other hard part for consumers, too, is that the messages that you're getting from the media are like. opposite sometimes, right? You're like, the economy is stronger than ever. The economy is terrible. Interest rates are going to go down. But wait, they're actually going up. There's no consistency in what's happening right now.

• Speaker #1

  Not at all. No, because I think we don't know. There's a lot more uncertainty. I think the biggest driver has been tariffs this year because it's challenging because they've come in, they've come out, they've adjusted it. They're much higher than they were in Trump's first term. It took him about 18 months to actually implement any tariffs. And he did it on China specifically for the most part. And he did about just under 17% of goods that we bring in. The tariffs that he's putting in now is about 40% of all the goods we have. So it's more than double the amount of tariffs we've had.

• Speaker #0

  Wow. So like just a way bigger impact on everybody's pocket.

• Speaker #1

  Yeah. So I think when you look in those terms, like that's a big amount of goods coming into the company and it's with... people from Mexico, this is from Canada. So those are really our two biggest trading partners. They throw in China, that's our big three right there that we trade with. So that's a really big impact that we're having. And the goalpost seems to keep moving. So the market's trying to figure out, okay, what's sticking, what's not sticking? It's really hard.

• Speaker #0

  Yeah. Well, I think the other piece of that that people have to realize too is that a lot of these sort of policies that are coming into play, we could not have predicted six months ago. So when the market's looking forward six months, right, trying to figure stuff out, like...

• Speaker #1

  some of this stuff we had nobody had any idea was coming well yeah it's like okay tariffs we'll probably do china right because you know there's obvious reasons to do china because they're you know there are adversaries in a lot of ways they manipulate their currency you know makes sense because you know they they steal our technology yeah like that's an obvious trading partner i don't think a lot of people are thinking oh yeah mexico and canada we've got to attack that right from tariffs i think that's that's where a lot of disconnect can happen especially when you you think something else is going to happen and then you know why happens okay now recession

• Speaker #0

  so how how will there be like a big blazing sign that's like, we are officially in a recession? Or is it the sort of thing that we're going to almost know after the fact? How does that work?

• Speaker #1

  You typically know it actually after the fact, and that's the biggest challenge with predicting recession. No one's able to really do it well consistently. Some people got lucky with certain things, especially in 2008 with the housing crisis. That was a little bit more, things were kind of coming down the pike.

• Speaker #0

  That was our fault in the lending industry. Sorry, everybody.

• Speaker #1

  Yeah, you guys are just giving money to everyone. But there's certain trends you can kind of start to look at and see where things are going. The one thing that people need to know is in America, the people buying stuff. So the US consumer makes up 70% of our economy.

• Speaker #0

  Wow. So us buying our own stuff.

• Speaker #1

  Yeah. Yeah. We did an episode on TikTok and all this stuff. So we keep buying stuff on TikTok and all that crap. We'll be fine. Okay,

• Speaker #0

  cool. Right. I'm in.

• Speaker #1

  So the things to watch out for, okay, like what's an unemployment? Because one of the reasons we weren't in a recession in 22, even though GDP was down, is unemployment stayed very low. Very low. So people still had jobs. Inflation was up, but we're still buying stuff. We weren't getting kicked out of our houses. We weren't. being laid off uh in mass so unemployment's still low so as of right now unemployment is still pretty low um so it's about four to four and a half percent depending on like what meds are where you look a little bit over the last couple months but still not where anybody thought it was going to be yeah so to me if you're kind of looking at like are we headed for a recession like that's the main thing you want to look at like do people still have jobs because when people have jobs you're going to spend money it's when people don't have jobs they're going to spend money not going to spend money they pull back um so consumer spending has actually declined a little bit in january who knows if that's like environmental related because it's been so cold you know the wildfires in california combination of all that stuff um so that's another thing to look at another thing to look at is like credit and debt so there's two two sides of the coin to that right there's the All right. I'm a consumer and my debt is going up because I need to...

• Speaker #0

  Exponentially right now.

• Speaker #1

  Exponential. Well, did you see that thing with DoorDash? And now you can do the buy now, pay later with that?

• Speaker #0

  Of your McDonald's. Yeah. So... Of your... Yeah. Consumer debt is at all-time highs right now. So what people are carrying on their credit cards, personal loans, everything like that, highs.

• Speaker #1

  Yeah. And you want to start looking at things like default rates or the percentage of your income that is debt and things like that. That's starting to tick up. It's not an alarming area yet, but that's another indicator to look at because... Once again, there's a certain point where you can only borrow so much and then you're pinched somewhere else. Yeah.

• Speaker #0

  And I'm starting to see that on my end a little bit with consumers who are either trying to buy houses and it's becoming difficult for them. Or we are starting to get a lot of requests for cash out refinances right now. And that's a lot of debt consolidation that people have two or three credit cards. They've been run up so high. They become unmanageable. And they're like, how do I lower my monthly debt obligation? And that's a cash out refi is a common way to do it. Yeah. um and we that's just sort of started pumping back into the mortgage industry now but would that also make it more expensive now because now the your cash you got to refi it at a higher rate though yeah so different the question becomes and i've said the same sentence on the podcast before is what is worth more to you cash on hand or cash over time when you do not have enough money on a monthly basis cash on hand is more important so lowering your monthly debt obligation even if long term this will cost you more is often what is more important and it's that's what will keep you in your house and keep food on your table and things like that it will cost you more over time because you have raised that interest rate and you have spread that debt out over a longer period of time so it is a conversation that you have to have with people when we talk about these that like this is not a band-aid that you can slap on like you have to recognize how you got here because you don't have 15 shots to cash yeah right your mortgage and take that equity like it's kind of a you got to solve the problem now this is your fix it but then you got to change your habits later yeah fix the behavior because that's ultimately what's going to drive what's going on but i think i think one other thing kind of

• Speaker #1

  maybe going back to the consumer debt for a second is thinking about, we talked about this a little earlier, the amount of equity people have in their homes right now.

• Speaker #0

  Exponential. It's the highest equity that we've ever had in the United States. What do we mean by that is people have their mortgage versus what their value of their home is very different right now. So if you bought a house, say 10 years ago for 350, your mortgage at this point is down to 200, but now your house is worth 600. You have a lot of equity. Why is that important? Is that is money that you can tap into in an emergency. That's a cash out refi. Or if you needed to sell your house because you could no longer afford to live there, you have equity to get out of that property.

• Speaker #1

  And that's where it's not like 2008 because all those were called underwater loans where the value of your house was lower than what you bought it for. Mortgage.

• Speaker #0

  Yeah, exactly.

• Speaker #1

  Right. So you could actually get on it, have a lever to pull it, so to speak. It may not be the extreme where you have to sell your house, but maybe the cash out refi. So there's... Yes, there's some trends here that are working for and against people, right? So that's something we want to keep in mind when it comes to trying to predict a recession. And I think at the end of the day, it doesn't really do anyone good to try and overly predict stuff because you're probably going to be wrong. But then the other measure we're kind of looking at for recession is GDP growth. Like how is the kind of health of the economy doing? Some revisions have come down a little bit. They're probably looking at GDP not growing as fast, which is different than contracting.

• Speaker #0

  Yeah, right. That's two different things. That's right. Instead of a two, I'm a three, but I'm not a negative two. People don't get that. They're not the same thing.

• Speaker #1

  Yeah, yeah. I mean, it's better to grow at like 1.1% or lose two, right? So we're at the probably growing by 1.1%, one and a half. So I think that's where it's like, okay, it probably doesn't feel as good as it did the last couple of years. But at least we're still positive. So that's not like, oh, my God, we got to start buying cans of tuna because the supermarket is going to be stocked out, right? So. That's another thing to look out for. We kind of touched a little bit on this, but the other piece is the inflation part of it. This is probably kind of somewhat tied to the tariff equation. We did see inflation rise a little bit. We had another meeting on Friday, recording this as of April 1st. Keep that in mind that half this data may be-

• Speaker #0

  Right. It goes real fast these days. It goes real fast.

• Speaker #1

  Right. Right. I would just look at that in general and say, okay, overall, I think we're in an okay spot. You know, what I've seen from the market standpoint is like a lot of the tariffs are triggering the movements up and down to the market. It's kind of like almost turning it on like a spigot, like, oh, let's put this on. OK, now they overreact to that, whether it's either up or down or, you know, so that's another thing. And my worry for clients is like a lot of them are freaking out, said, I want to go to cash right now because I think the market's tanking. I think the economy is dying right now. It's going to head into recession like they get their heads into sand. That's not the way to go about this whole situation because my one fear is like, okay, he's going to remove the tariff and then all of a sudden the market's going to shoot back up.

• Speaker #0

  Right. And you've now lost what you lost and you've lost what you could gain.

• Speaker #1

  Exactly. So now you're hurting yourself twice. So that's one thing I want to make sure people are aware of. And if you're in a position where you're like that nervous about the market, it's probably because you don't have your money allocated in the correct way. Right. And so I'm sure you're probably like, what is that?

• Speaker #0

  No, that's my favorite thing that you talk about is where's your money working for you? What bucket is it in? Is it for long-term or short? I've learned so much doing this podcast.

• Speaker #1

  Right. Yeah. So just to recap quickly, short-term, I want to buy a house in two years. That should be in cash. anything anything more than two years you can start investing but anything less than two years you're gonna access it's not worth like the extra like ten dollars you're gonna make yeah just leave it where you can grab it because you don't want to be the other side of the coin where it's down 20 and you oh my down payment just went away yeah i need to save another four or five months um anything over that then you kind of buck it out in either you know middle middle bucket where you say okay i'm gonna do something in five or six years you want to be like 50 stock 60 stock maybe but more like quality stuff and then anything over that like your retirement accounts just this is gonna be a blip We're talking next 20, 30 years. Like, no one's going to worry about what happened in three months over a 30-year lifespan. I mean, I can show you a chart where everything happens every year, and there's like eight things that would cause you to freak out based on the news. So don't overreact to that stuff in general.

• Speaker #0

  In general. Well, and I think the other interesting indicator, and we were talking about this before we hopped on today, is that, you know, thinking about a recession and people spending money, right, is if 70% of our GDP is people spending their money, if you go to a restaurant on a Friday night right now, it's packed.

• Speaker #1

  Packed. Packed. Packed.

• Speaker #0

  People are out there spending money. And part of that is because of there's very low unemployment. So as you said, people have to connect the dots on this stuff, that it's one impacts the other. And if all of a sudden you show up at Max Fish on Friday night, and there's nobody there, we might be in a recession at this point.

• Speaker #1

  Yeah. Yeah. And there's all those indicators you see just anecdotally, right? I mean, you can't have any stats on that, but you go to a Target and they're packed. You go somewhere else and they're packed. You know, I think the other important thing to consider is like, we're just such a different economy now than we were 30, 40 years ago. Like we're not, we're not a manufacturing economy anymore. As much as the tariffs are kind of designed to help bring some of that back, there's, we're just software.

• Speaker #0

  That's not today. That's not today.

• Speaker #1

  That's not today. Yeah. Most people are service-based business here in the U.S. So, you know, as long as people, other people are spending money, that's typically when you're, you're, you know, you're making your money in general. So the money just kind of cycles through the economy that way. So it's not something where, I mean, I'm not saying we're never gonna have another recession again. That'd be ridiculous. um but they're just gonna hit differently and or maybe they'll be more of like i i kind of tend to think like the 22 is more of a rolling recession where it hits certain industries at certain times uh we may probably see something like that again um but like i said the the government steps in now and just puts their foot on the scale so much when it comes to recessions they're just like oh we gotta throw money at the problem and well that was that was 2020.

• Speaker #0

  so like we were headed because of covet and everything that was happening they were like this is going to be a recession and then all this money got thrown we We were getting those stimulus checks. You were getting child care checks. You were getting PPP loans. Interest rates were zero. We were giving people houses at 2.5%. So much money was thrown in the economy. That recession never really happened. It's there. If you look economically at data, there are some blips in that period of time. But it never really happened. And there was not a very long-lasting consequence at that time. Now we are dealing with the consequences of that.

• Speaker #1

  Yeah. Well, I think to me, that was a trade-off decision, right? It's like, either do we head in a recession by dumping a ton of money in there, or we avoid dumping money in there, or do we dump a ton of money in there, and then the effects could be inflation. And we got the inflation piece of it. So I think a reasonable person would probably say, I'd rather have the inflation still in my job than no job and low inflation.

• Speaker #0

  Exactly. Yeah,

• Speaker #1

  100%. But we're still fighting the inflation piece, and it still sucks. It still sucks to go to the grocery store and see eggs be $7, $8. It still sucks to have cars be so expensive now, and all the other stuff. So I think my one worry is, okay, is inflation is going to stay for a while. That's probably what I'm keeping track on. My other worry is if the tariffs stay for a long time, that could be impactful. Because that's going to, you know, they're saying it's probably going to reduce GDP by half a percent to 1%. Yeah,

• Speaker #0

  which is a big deal.

• Speaker #1

  Yeah, it's a big deal. I mean, especially when you're at two. So you're basically talking about cutting your growth in half almost. So that could be a problem. And then the third thing, like I said, I would just keep watching unemployment.

• Speaker #0

  And just see what that looks like. And I think that's one of those things, again, like. that's where the rolling part may come in because we're going to see that unemployment in different sectors sort of as it goes where it might be one industry that will see unemployment rise but then another one will be okay but then a couple months later you'll see it somewhere else and then you'll see it somewhere else and I think that is just something for you it's not going to necessarily be a crash where we can you know we think about like the Great Depression where there's a day you know exactly what day that happened right we're not really going to see that here

• Speaker #1

  No, I mean, because there's typically with, if you look back at history with recessions, there's generally like a catalyst that happens, right? So it was the catalyst and something kind of falls through it. Like if you look at 2008, there was, okay, the interest rates increased and we had all these adjustable rate mortgages and that increased a bunch of people's expenses because they went from 2% mortgage or four to five or six, right? So they just went from something they could afford. to something they could afford and then it just rippled through the economy right so and same thing even with covid like covid was a thing that like okay the kobe thing happened but the economy didn't close because of covid because because we closed the economy down yeah right so there's there's all these things that you you're going to typically see a catalyst first then you're going to see a ripple effect because of that catalyst and i don't know what that would be and no one typically knows because that's that's why recessions happen because they have these these weird things that happen that we don't predict yeah so like we can see it we can wonder but until it's really here

• Speaker #0

  that there's no magic eight ball for us. No,

• Speaker #1

  but I think there's probably some things that you could do to prepare, right? So first thing is I would make sure you would have some extra cash available, right? So if you don't have an emergency fund now, work on getting one.

• Speaker #0

  Now by extra cash, do we mean mattress money? Like I have apocalypse money under my mattress or just like in your savings account at the bank, you should have a little extra dough.

• Speaker #1

  In your savings account. I'm not a big have cash in your house.

• Speaker #0

  I would agree with that. That's why I asked the question.

• Speaker #1

  Look, if the internet's down, like their registers aren't working, you're not paying in cash anyway. Yeah, true story. You know, you better have like, another advisor always jokes, like you're better off having brass because that's what they make bullets out of, right? Mike

• Speaker #0

  Gold, bullion hunting.

• Speaker #1

  No one's going to buy your gold.

• Speaker #0

  No one,

• Speaker #1

  right? So I would build up some extra cash, you know, really make sure you're tight at work. You know, don't mess around a little bit. I would say that. You know, make sure that your investments are aligned with your goals because, you know, a recession would. typically indicate a drop in the stock market. So make sure you're invested correctly for that. But also be ready for opportunities because so much wealth can be created during recessions. Like if you look once again at 2008, like how many houses were so cheap?

• Speaker #0

  So cheap, which are now worth so much for people.

• Speaker #1

  So much wealth was created when people dove in and bought all those houses and either rented them out or flipped them or did all this stuff. So like anytime you think there's a recession, you should in your head be like, ooh, opportunity, right? So just, I think, mentally prepare yourself and just have some extra cash available. You know, make sure your jobs are OK. But I would just, you know, grin and bear it because it's going to happen. Yeah.

• Speaker #0

  Again, as millennials, this is not our first recession rodeo. Yeah.

• Speaker #1

  It's not going to happen. Yeah. I mean, we kind of were born into some and then immediately had a bunch of other ones. So they're going to happen. They're going to happen. There's definitely some things you can do to prepare. And there's going to be some opportunities that come up. So I would just reframe it, especially, you know, for us, we've got 20 plus years to retirement. And like there's going to be so much wealth created if there is a recession. Not saying you should hope for it.

• Speaker #0

  But like, you know, it's not as well. And I think, you know, one of the pieces to that is also the don't get sucked into like media hype about all of this stuff is if you can be level headed and look for those opportunities and prepare yourself, don't get sucked into the media. Because it's right now, again, like one news station says one thing, one says another. You read a newspaper, it's another. There's some bro on TikTok telling you that you're going to buy all the foreclosures. There's not going to be foreclosures.

• Speaker #1

  Not at all. And this is where also like the. the political leanings you have can really determine how you're looking at this stuff. And that's been a fun part of my job is figuring out, okay, who voted for what? Because that kind of tells you how they're reacting to this. And I think they can be hyperbolic on both sides, right? Like on how good the economy is or how bad it is. We've got to just tone it down because it's not as bad or as good as they say it is. Yeah, neither one. So don't overreact based on your political leanings is probably my other piece of advice.

• Speaker #0

  I love it. Awesome. Well, so now we know, friends, that... Is there a recession? Not right now. Not right now. Is there going to be a recession? Maybe.

• Speaker #1

  Hopefully not.

• Speaker #0

  But will we know? Not really until it's here. Once it's here, you'll know. Right.

• Speaker #1

  Exactly. So best of luck, but don't overreact.

• Speaker #2

  That's my big advice. Always be prepared. Yep. Consult the appropriate qualified professional prior to making a decision. Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful. All performance reference is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.