Welcome back to the Deep Dive. Today we are cracking
open a metric that seems so simple on the surface,
but it has all these hidden layers of complexity.
I'm talking about the annual percentage rate
or APR. You wanted us to unpack this one and
for good reason. It's marketed as the great equalizer,
right? The one number that lets you compare any
loan, any mortgage, any credit card just instantly.
And that's really the central unavoidable irony
here. I mean, APR is legally mandated. It was
designed specifically for consumer protection
for easy comparison. But once you start to really
dig into the source material, you find that the
calculation is, well, it's highly discretionary.
It varies wildly depending on whether you're
in the U .S. or the EU. And in many cases, it
fundamentally fails to represent the true total
cost, especially for a savvy borrower who's really
trying to optimize their debt. OK, so let's unpack
this. Our mission today is to go way beyond the
textbook definition. We need to understand not
just what APR is, but the multiple, often conflicting
ways it gets calculated. And why a legally compliant
APR in, say, Texas is mathematically different
from one in Portugal. And most critically, where
this whole system of standardization just falls
apart, leaving you, the consumer, to do the hard
math yourself. Yeah, exactly. So to lay the groundwork,
let's start with a core concept that everyone
sort of agrees on. APR is the finance charge
for a whole year, expresses an annualized rate.
It applies to loans, mortgages, credit cards,
and its original intent everywhere was to create
a clear standard. But right out of the gate,
we hit a major problem, especially in the United
States. It's something that confuses just about
every borrower. APR isn't just one thing. There
are two main flavors, and understanding the difference
is absolutely essential. Precisely. We have to
distinguish between what's called the nominal
APR and the effective APR, or eAPR. The nominal
APR is the simple one. It's just the simple interest
rate for a year. You take the periodic rate,
so what you're charged each month or each week,
and you just multiply it by the number of periods
in a year. It completely ignores compounding.
Okay, so if my credit code says it charges 1
.5 % interest every month, the nominal APR is
just 1 .5 times 12, so 18%. But that doesn't
account for the fact that each month the interest
is calculated on a new higher balance that includes
last month's interest. Exactly. And that's where
the effective APR, the EAPR, comes in. Some people
call it the effective annual rate or EER. This
is the true mathematically correct interest rate
that actually accounts for that compounding effect.
And in theory, it should also include any mandatory
fees tied to the loan. It's the annual rate you're
actually paying. And that distinction is so crucial
because the U .S. system. for disclosure, mainly
uses that nominal APR, which is then compounded
monthly, but they just label it APR, which is
misleading. And this right here sets the stage
for everything else because even the definition
of effective. the true cost, gets slippery depending
on which fees a lender has to include. That's
the multiplicity problem. We agree that the EAPR
should reflect the compound interest plus the
fees, but the calculation, it varies wildly.
There's just no universal agreement on which
fees are non -negotiable costs of borrowing versus
just administrative charges. Things like participation
fees, loan origination fees, service charges.
Their inclusion is often discretionary or subject
to very specific state laws. So a lender, or
even the software they use, has to make an economic
choice about what counts as the cost of borrowing.
I mean, if a fee is mandatory to get the money,
shouldn't that automatically be part of the APR?
Logically, you'd think so. But legally, not always.
We can see at least three different ways that
effective APR gets computed, and they all give
you different results precisely because of how
they treat those fees. The simplest, and I'd
argue the most misleading way, is method one.
You just compound the interest rate for the year
and completely ignore all the upfront fees. So
it just pretends the fees don't exist. Right.
It gives you a clean compounding rate, which
is useful for comparing interest structures,
I guess, but it fails the consumer protection
test. It leaves out mandatory charges you have
to pay to get the credit. That seems like a massive
underestimation of the cost, especially if you
have a big origination fee, like, say, 2 % on
a mortgage. If it's so misleading, why is it
even a permissible way to calculate it, even
internally? Because it simplifies the underlying
math. It separates the cost of the capital from
the cost of administration. But, to be clear,
it's not the standard method for disclosure under
TILA, which does require including some fees.
And that brings us to method two, which is a
bit better. Okay, method two. Method two tries
to fix that gap. It takes the origination fees
and adds them directly to the balance due. So
the whole amount principal plus fees is treated
as the new effective principal. And that's what
the compound interest is based on. The assumption
is the lender financed those fees for you. So
if I borrow $100 ,000, but there's a $2 ,000
origination fee. They calculate my interest as
if I borrowed $102 ,000 from day one. That feels
like a much more accurate reflection of my actual
financial exposure. It is, and it tends to inflate
the APR a bit compared to method one. But then
there's a third, even more complex approach,
method three. Some lenders use this one, especially
in non -standard financing agreements. What's
method three? Method three treats those origination
fees as if they're a separate short -term loan
that's amortized almost immediately, due in the
first payment or two. And then the rest of the
unpaid balance is treated as the separate long
-term loan. Wait, so it's like splitting the
loan in two, one part to pay the fees right away
and the other for the actual money I borrowed,
all hidden in one payment schedule. Why would
a lender want to do that? The incentive is subtle,
but it's powerful. If you pay down those big
upfront fees almost immediately, the principal
balance of the main long -term loan shrinks faster
than in method two. And this structure can, in
some cases, slightly lower the final long -term
APR that the lender has to disclose, even though
you paid the fees right up front. So you make
a couple of extra large payments at the start
to clear out the fees. Right. And by getting
those fees out of the long -term interest calculation
basis quickly, the lender can technically quote
you a slightly better APR on the long -term note.
It's an accounting maneuver, really, designed
to optimize the quoted rate. This just shows
how arbitrary the whole process is. Okay, let's
get to that shocking example, because this is
what really drives home why just including or
excluding one single fee can completely break
the whole idea of comparing APRs. This is the
aha moment. It's the proof that you can't just
look at the APR number. You have to read the
fine print on fees. So imagine a really simple
short -term loan, $100, you have to pay it back
after one month, plus 5 % interest, and there's
a flat $10 administrative fee. Okay, so after
30 days, I owe them the $100 principal. $5 in
interest, and that $10 fee. My total repayment
is $115. Right. Now, let's calculate the effective
APR based on two different legal interpretations.
Interpretation A, we ignore the $10 fee. We treat
it as an excluded administrative cost, so the
monthly rate is just 5%. If we compound that
monthly rate over 12 periods, so 1 .05 to the
power of 12, the effective APR comes out to about
79 .59%. Let's just call it... 80%. That's already
high, but it's just the interest compounding.
Okay. 80%. That's the baseline. Now let's factor
in that mandatory $10 fee. Okay. Interpretation
B. We recognize that a $10 fee on a $100 loan
is basically an extra 10 % charge for the month.
So your total effective monthly charge is now
15%. That's the 5 % interest plus the 10 % from
the fee. Now compound that higher rate for a
year. So 1 .15 to the power of 12. That small
bump in the monthly rate is going to be catastrophic
when you compound it annually. It is truly staggering.
Compounding 15 % monthly gives you a factor of
5 .35. So the total annual increase is 435%.
So for the exact same loan paid back the exact
same way, the calculated effective APR could
be quoted as 80 % or 435%. Wow. And your ability
as a consumer to compare loans just disappears.
All because the laws vary on whether that mandatory
fee has to be included in the calculation. So
you wanted a great equalizer. Instead, you get
calculation anarchy based on legal loopholes.
Right. The lesson here for you is to always ask
for the total cost in dollars, not just the rate.
Exactly. This complexity forces governments to
step in and try to mandate standardization. But
even that standardization is wildly different
depending on where you are. Let's start with
the U .S. regulatory environment. It tries to
sort of bridge the gap between that misleading
nominal rate and the true cost. The framework
here is the Truth in Lending Act. Or TILA. It's
implemented by the Consumer Financial Protection
Bureau, the CFPB, through something called Regulation
Z. In the U .S., the APR figure you have to disclose
is this. This artificially inflated nominal rate.
It takes the periodic rate times the number of
periods, but TILA requires you to include certain
non -interest charges and fees in that calculation.
So it's a regulatory Frankenstein's monster.
It's a nominal rate, but it's... inflated to
account for some fees, making it this hybrid
number that's neither the true compound cost
nor the simple interest rate. That's a perfect
way to put it. Yeah. It requires this detailed,
almost arbitrary calculation to figure out exactly
which fees have to be covered. And this APR has
to be disclosed to you within three days of applying
for a mortgage. You'll find it on that initial
truth and lending disclosure. And if we look
at mortgages specifically. The rules get incredibly
strict about the accuracy of that hybrid figure.
I'm thinking about the Mortgage Disclosure Improvement
Act, the MDIA. Right, the MDIA. It came into
effect in 2009, and it introduced a critical
rule about the tolerance level for APR disclosure.
Regulators realized people were getting surprised
at the closing table with slightly different
rates. So the rule says if the final APR on your
mortgage is off by more than 0 .125 percent.
One -eighth of one percent. Exactly. Just one
-eighth of one percent different from the initial
disclosure, the lender is required to redisclose.
Why should a borrower care about a number that
small? 0 .125%. Because that tiny variance triggers
a mandatory three business day waiting period
before you can close on the loan. It's government
saying you almost misled this consumer. Now they
get a cooling off period. For you, that 0 .125
% is a threshold of significant financial inaccuracy.
If the actual rate is higher by that tiny margin,
the lender has to hit pause and that could delay
your closing by days or even weeks. And Tila
has different rules for different kinds of credit,
right? It does. Yes, it splits them into close
ended credit. That's your fixed term mortgages
and auto loans and open ended credit, which is
your credit cards and lines of credit. The calculations
are different for each. OK, now let's give it
across the pond because the EU's goal was radically
different. They wanted singular transparency.
based on mathematical purity. Yeah, the EU approach
is fundamentally philosophical. They wanted to
eliminate all the confusion. Their directives
basically demanded a unified approach. The goal
was to make sure a consumer gets a comprehensible
set of information and that every creditor must
use the exact same form and formula. So the idea
was forget nominal rates and confusing hybrids.
We're going to force everyone to use the true
single economic cost calculation, no matter how
complex it is. That is precisely the objective.
The EU mandated a single method based on the
Internal Rate of Return, or IRR, methodology.
The math is designed to equate the present value
of the money the lender gives you with the present
value of the money you pay back. The APR is the
interest rate that makes those two values exactly
equal. That sounds pretty dense for a consumer
disclosure. Can you simplify the principle for
us? Think of it like this. Money today is worth
more than money tomorrow. The EU formula is trying
to find the single discount rate that perfectly
balances the cash flow from the lender to you
against the cash flow from you back to the lender.
The formula finds that one annual interest rate
that makes those two streams of money have the
identical value today at the moment you sign
the contract. So it's a true yield calculation.
It's like finding the internal rate of return
for the entire life of the debt and the precision
they demand is. Almost absurd. It really is standardization
taken to the nth degree. The EU standard says
a year has 365 days, or 366 for a leap year,
and an equal month is defined with incredible
specificity, exactly 30 .41666 days. This makes
sure every bank across the continent is using
the exact same time assumption for every calculation.
It eliminates one source of variability. And
the final APR has to be expressed to at least
one decimal place. Yeah, true. Uniform standardization.
But... This rigor comes with major limitations.
The directive only applies to consumer credit
agreements of 50 ,000 and below. And critically,
it excludes all mortgages. The complexity of
modeling a 30 year cash flow with variable rates
and refinancing was just too much to force into
one formula across all member states at first.
But some countries did adopt a similar formula
for their mortgages anyway, right? They did.
Places like the Netherlands use a similar cash
flow based formula. And when they do that, it
has to account for all the moving parts, the
principal, any prepaid fees and maybe even a
residual rest debt. if it's an interest -only
loan. And you can't just solve for that APR directly,
can you? No, it's mathematically impossible.
Because the APR is embedded in the exponents
in the amortization formulas, you have to solve
for it iteratively. You basically have to make
a guess, see if it balances, and then refine
your guess until you get the required precision.
It requires sophisticated financial software.
So on one side, you've got the U .S. system,
which is standardized but uses a kind of misleading
hybrid rate. On the other, the EU system, which
uses the mathematically pure rate, but only for
small consumer loans. Neither system is perfect.
Not at all. And this all connects to the bigger
picture. The whole point of these regulations,
whether it's TILA or the EU directives, is to
combat one primary tactic lenders have used for
centuries. And that's using confusing language
to make a loan seem cheaper than it is. That's
why APR was invented, to standardize it so you
don't get tricked by terms like rate in advance
or monthly periodic rate. So let's take a simple,
true, cost -effective annual rate of 10%. What
are some confusing ways a lender could quote
that same rate? Oh, there are several. If a loan's
true ER is 10%, a lender could confuse you by
quoting it as a 0 .7974 % effective monthly interest
rate. That number looks tiny, right? Almost nothing.
But compound it for 12 months and you're at 10%.
Or they could quote it as 9 .569 % annual interest
rate compounded monthly. That's just the tiny
monthly rate multiplied by 12, ignoring the compounding,
or even more obscurely as 9 .091 % annual rate.
advance. This one always sounds the cheapest,
but it's just another mathematical trick to get
to the same 10 % effective cost. So the whole
job of APR is to cut through that jargon so you're
comparing apples to apples. But there's a problem
here that even standardized APR can't fix. The
APR is heavily dependent on the duration of the
loan. This is a critical failing. You simply
cannot compare the APR for a 30 -year loan directly
to the APR for a 20 -year loan. It is a factor
that matters most. And that time dependence is
all governed by the amortization schedule. The
longer the loan, the lower the payment seems.
Right. But the more often that interest has time
to accrue and compound before you paid on the
principal. As the number of payments, N, gets
bigger, the payment size, P, gets smaller, which
feels good. But the total interest you pay just
skyrockets. Let's use that classic mortgage example
to show the brutal financial gravity here. Say
a simple $100 ,000 principal loan, no fees, stable
interest rate. Okay. If that $100 ,000 is mortgaged
over 15 years, the total cost you pay, principal
and interest, is $193 ,429. The interest you
paid is $93 ,429 .80. So 93 .4 % of the original
principal. You nearly double your money. Now
hold the APR constant. Same rate, same lender,
but spread it out over 30 years. Over 30 years.
The total cost jumps to $315 ,925 .20. The total
interest is now $215 ,925 .20. That's 215 .9
% of the original principal. Wait, so the same
borrower, same rate? Just by picking a longer
term pays more than double the original loan
amount in interest alone. Correct. The APR only
tells you the rate of the charge, not the magnitude
of the total financial commitment. For a savvy
borrower, the calendar is often a much greater
danger than a small difference in the rate. APR
is meaningless if you aren't comparing loans
with identical terms. This brings up another
point, especially for mortgages. The APR calculation
assumes you'll keep the loan for the entire term.
What happens when that assumption is broken?
This is a major structural failing. Most U .S.
mortgages are paid off or refinanced within,
say, seven to 10 years. If you pay off a 30 year
mortgage after only seven years, all those big
upfront fees and points that were spread out
over 30 years in the APR calculation, they get
compressed into a seven year period. Which drastically
increases the actual effective rate you paid
during the time you have a loan. Absolutely.
The 30 -year APR significantly understates the
effective cost for anyone who moves or refinances.
If you move often, a slightly lower interest
rate loan with high origination fees will often
be way more expensive than a slightly higher
rate loan with zero fees, even if the APR is
identical on paper. And before we move on, we
have to touch on the money factor because this
is a standard measurement used to intentionally
hide the APR in car leasing. Right. When you
lease a car, instead of quoting an APR, they
quote a money factor. It's often this deceptively
small decimal, like .0030. Seems tiny. How do
you translate that to the rate I'm actually paying?
You have to multiply the money factor by 2 ,400.
That's the industry standard. So a money factor
of .0033, you multiply it by 2 ,400, and you
get 7 .2%. That's your actual equivalent APR.
Why 2 ,400? The math is a bit complex, but the
money factor is basically the average monthly
interest divided by the average value of the
car. To get it back to an annualized percentage,
you have to multiply by 12 for the months and
100 to make it a percent. And it all works out
to that 2400 factor. It's designed to be opaque.
It's a way to present the interest so it seems
small, forcing you to do unfamiliar math to discover
the true rate. It's a perfect example of the
financial jargon trap. OK, so despite all these
regulations. The U .S. APR system still fails
in several key areas. Let's start with the most
insidious one. The confusion between the nominal
rate and the effective rate. Right. For credit
cards, nearly all U .S. products are quoted in
nominal APR compounded monthly. The failure is
that they use the word annual in APR, but they
are not disclosing the true effective annual
rate, the ER. The effect of that monthly compounding
is hidden, so the bank gets to quote a lower
rate than what you actually pay. So the quoted
rate is lying by omission. It's not including
the powerful exponential effect of monthly compounding.
Let's talk about the financial gravity of this.
We can use the formula to show it. Let's take
a common credit card rate, courted at 12 .99
% nominal APR. The actual one -year EER is not
12 .99%. It's 13 .7975%. That's almost a full
percentage point difference. That's not a rounding
error. That's like a whole other tier of interest
hidden in the math. What about high -interest
cards? If a card have a high nominal APR of 29
.99 % compounded monthly, it's actual effective
annual rate. The rate you really pay over a year
is 34 .48%. That's nearly five full percentage
points of difference hidden just by using the
nominal quote instead of the ER. So the rate
is quoted at 29 .99%, but the true rate is 34
.48%. That is catastrophic hidden cost. Why does
the U .S. system stick with disclosing the nominal
rate knowing the ear is the truth? It's largely
historical. It's linked to how TILA was first
written. Simple annual interest was easier to
calculate and it was accepted as the standard.
Changing it now across the entire industry would
require a massive legislative overhaul. And there's
a significant lobbying against requiring the
disclosure of the higher ear figure. And the
long term impact is just devastating. Let's look
at that $200 ,000 loan example. OK, a 30 year
loan of $200 ,000. If the lender says the APR
is 10%. Now, if that loan had a true flat 10
.00 % ER, the mathematically true annual cost,
what's the payment? The payment for a true 10
.00 % ER loan would be $1 ,691 .78. The difference
is $64 .09 a month. It doesn't sound like much,
but you pay that every month for 30 years. Over
the life of the loan, that small difference amounts
to $23 ,070 .86 in extra interest. $23 ,000 extra.
Just because of the subtle difference in how
the rate is quoted and calculated, that's a hidden
cost you are absolutely not equipped to calculate
on the fly. This brings us to failing number
two. The intentional exclusion of key fees, or
what a lot of people call junk fees. Right. Because
APR is a regulatory construct, some fees are
deliberately not included in the calculation
under TILA. So the APR always understates the
total cost of borrowing. These usually fall into
two categories. First, routine one -time fees
paid to third parties, like a real estate attorney.
Second, conditional charges, like penalties for
late fees or over -limit fees. These are excluded
no matter how big they are or how likely you
are to be charged. Lenders say these are just
pass -through. costs, right? Unrelated to the
cost of the capital itself. That's their argument.
They say they're separate transactions, not a
cost of the lending itself. They also argue that
including things like late fees would require
making assumptions about your future behavior,
which they say would just create more confusion.
But consumer advocates push back hard on that,
pointing out that in many cases, the lender insists
you use their specific attorney or vendor. That
makes the fee a mandatory cost of doing business.
That is the core of the debate. If the lender
controls the vendor, advocates say the fee is
part of the total cost and should be included.
And this gets even more complicated when you
have contingency fees, where the lender gets
a hidden kickback from the attorney or appraisal
firm for sending business their way. Which explains
why U .S. regulators require lenders to give
you an affiliated business disclosure form showing
any kickbacks between the lender and these third
parties. Exactly. But even with those forms,
the fees themselves are often still excluded
from the APR. It means you, the borrower, have
to compare the quoted APR plus the affiliated
business disclosure form plus the closing cost
sheet to understand the real price. It's a three
-step process, not one. Which brings us to failing
number three. APR isn't a truly comparable standard,
even in a highly regulated environment. because
of how discretionary the fee inclusion is. Correct.
Regulators just couldn't mandate every single
fee be included. So as a consumer, you can calculate
the APR yourself, but you still need access to
all the costs and assumptions which the lender
might withhold. Let's run through the list of
fees and their status in a U .S. mortgage, because
this really highlights the confusion. Okay. There
are fees that are generally included. Regulators
decided these definitely impact the cost of capital.
That's your points, prepaid interest, and origination
fees. Then you have the routine costs that are
generally not. included in the APR. This list
is long. Application fees, appraisal costs, credit
report costs, the title fee. You have to pay
all of them to get the loan, but they don't inflate
the disclosed APR. And then the most problematic
category, fees that are only sometimes included.
This is where comparability dies. This list includes
attorney fees. document prep fees, and critically,
private mortgage insurance, or PMI. PMI is a
huge ongoing cost, and whether it's included
or not can drastically alter the APR. It's almost
impossible to compare lender A to lender B without
their itemized fee sheets and a calculator. And
this breakdown is exposed completely in cases
of vendor financing, like car sales. The vendor
financing problem. Right. If a car dealer offers
you, say, 0 % financing, but only if you accept
the full MSRP for the car, the true cost of the
financing is hidden. The quoted APR understates
the true cost because you could have probably
negotiated a huge discount on the car if you'd
brought your own financing. So you feel like
you got cheap financing, but you really just
paid a much higher price for the car itself.
Exactly. The only way to know the true APR in
that case would be to find out the lowest cast
price the dealer would accept and then use that
as the principal. Consumers almost never have
that information, so the APR becomes functionally
meaningless. And now we come to the fourth and
maybe most controversial failing. the misrepresentation
of costs for small -dollar short -term loans.
like payday loans. The argument here is that
APR, because it's an annualized figure, inherently
exaggerates the cost of very short term products.
For example, a $25 fee on a $200 loan for two
weeks when you annualize it results in an astronomical
APR, sometimes thousands of percent. It's mathematically
correct, but it doesn't really represent the
actual dollar cost for that two week period.
So the tool for transparency becomes misleading,
not because it's understated, but because it's
dramatically overstated. for the short time frame.
That's the perspective from analysts who study
these products. They argue you're applying a
long -term metric to a short -term product and
it creates a distortion. There's a paper that
argues interest rate caps, like the proposed
36 % cap, overlook adverse economic effects.
What are those unintended consequences of a strict
36 % cap for short -term lenders? Well... The
analysis suggests that when you impose caps that
make the product financially unsustainable for
lenders because the administrative cost is fixed,
they just stop offering the product. They redirect
their capital elsewhere. This leads to a scarcity
of loans for the very consumers who need them
for emergencies. Demand outstrips supply and
it effectively becomes an implicit prohibition
of the product. So while the intent is protection,
the outcome might be forcing the most vulnerable
borrowers toward unlicensed, unregulated and
maybe more dangerous options. It's a classic
regulatory balancing act. So the very tool designed
for protection, when applied to broadly, can
unintentionally eliminate the product, potentially
harming the people it was meant to help. It's
the paradox of standardization. And a final caveat
is that APR also fails to capture the complexity
of nonstandard mortgages like variable rates
or interest -only periods. You have to make assumptions
about the future. That may not come true. And
to add to all this, three different lenders with
the exact same cost information might still calculate
three slightly different APRs. Absolutely. The
calculations are complex. Most lenders rely on
proprietary software. And because there are slightly
different methods and rounding rules, small differences
in the final APR are inevitable. So you're left
with a figure that's supposed to be accurate
to 0 .125%, but it's built on shifting sand.
We've covered a massive amount of ground today.
Our deep dive into APR reveals that what was
meant to be a simple standard metric is actually
this complex, multifaceted spectrum that rewards
cynicism and very detailed reading of the fine
print. The core learning really is that APR is
not one number. It varies fundamentally between
nominal and effective rates. And its definition
is heavily influenced by jurisdiction, where
the U .S. uses that misleading hybrid rate and
the EU mandates a mathematically rigorous equation,
but only for small loans. And we saw that critical
flaw in the U .S. system. The difference between
the quoted nominal APR and the true effective
rate can cost you over $23 ,000 extra on a single
mortgage. And those junk fees are often intentionally
left out, ensuring the number you see always
And we also established you can't use APR to
compare loans of different lengths. The 15 -year
versus 30 -year mortgage example proves the total
interest more than doubles at the same rate.
Time is often the most critical factor, not the
rate. For a savvy borrower, ignoring the calendar
is financial malpractice. So what does this all
mean for you, the learner? We'll leave you with
one final, provocative thought to consider. If
the calculation of APR is so mathematically demanding
that it requires sophisticated software and discretionary
assumptions, and if three different honest lenders
can still reach three slightly different APRs
with the same information, does this complex
standardization truly help the average consumer
make a simpler comparison? Or is it just a regulatory
hurdle that distracts you from the simpler, more
vital task, adding up all the dollar amounts
of the fees and the total dollar amount of interest
you'll pay? That $23 ,070 difference shows the
profound danger of trusting a percentage over
the actual cash flow. What stands out to you?
A question worth chewing on as you look at your
next credit agreement. Thank you for providing
the sources for this very necessary deep dive.
We'll see you next time.