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Speaker 1: The information provided in this program is of a general

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Speaker 1: nature and is not intended to be personalized financial advice.

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Speaker 1: We encourage you to seek appropriate advice from a qualified

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Speaker 1: professional to suit your individual circumstances. Equity markets are euphoric,

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Speaker 1: with the Nasdaq notching new all time highs this month,

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Speaker 1: But is the optimism overdone and are we on course

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Speaker 1: for a come down soon?

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Speaker 2: GIF way you cut it, the US market does look

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Speaker 2: very expensive. You have a Magnificent seven or a seven

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Speaker 2: Horsemen of the Apocalypse, whichever way you're whichever way you

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Speaker 2: choose to view them. You know, I have really been

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Speaker 2: the key driver.

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Speaker 3: The Magnificent seven.

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Speaker 1: Unknown mystery techtocs like Apple and Nvidia, the semiconductor superhero,

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Speaker 1: have sent UIs equity markets soaring, the Nazak setting a record,

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Speaker 1: the S and P five hundred, we're still waiting for

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Speaker 1: that to settle out, but it looks like we may

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Speaker 1: have got in a record there as well. The headline

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Speaker 1: numbers look strong, but it's really only driven by a

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Speaker 1: handful of companies involved in artificial intelligence, and they.

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Speaker 3: Took a bit of a hit last week.

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Speaker 1: Recent research from Morgan Stanley said S and P five

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Speaker 1: hundred concentration is at an historical extreme, which it warns

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Speaker 1: increases its vulnerability to a steep correction.

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Speaker 3: The chance of ten percent correction is highly likely sometime

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Speaker 3: between now and the election.

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Speaker 1: The US is just entering its earning season, where companies

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Speaker 1: will reveal if they're actually expanding in this economic cycle.

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Speaker 1: Expectations are high, as are valuations. The current price to

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Speaker 1: earning's ratio of the SMP is sitting at twenty six

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Speaker 1: times according to fact Set and CMC Markets. That's above

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Speaker 1: the ten year average of twenty one times. Salt Fund's

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Speaker 1: management's Matt Goodson is in the slightly bearish camp. In

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Speaker 1: this interview, he explains why concentration could be cause for concern. Well, Matt,

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Speaker 1: thank you so much for doing this. I really appreciate it. Well,

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Speaker 1: pleasure good to be in here.

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Speaker 3: Let's start talking by US equities.

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Speaker 1: Pretty incredible US equity markets, but surely unattainable.

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Speaker 3: What do you think?

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Speaker 2: Look, the US market as a whole has done eighteen

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Speaker 2: nineteen percent this year, but the S and P equated

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Speaker 2: index has done about four percent, so it's been a

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Speaker 2: rarely narrow concentrated advance. You have a magnificent seven or

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Speaker 2: seven Horsemen of the apocalypse, whichever way you are, whichever

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Speaker 2: way you choose to view them. I have raally been

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Speaker 2: the key driver and narrow leadership. It's not unusual. You

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Speaker 2: look back to pass booms, the leadership does get pretty narrow,

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Speaker 2: but this time around it rarely is concentrated.

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Speaker 1: If we've heard of instances like the nifty to fifty

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Speaker 1: and previous market cycles, how narrow does the Magnificent seven

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Speaker 1: compare to previous eighs?

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Speaker 2: From the stats I've seen, this is more narrow than

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Speaker 2: that episode in the sixties and early seventies, and more

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Speaker 2: narrow than the Nasdaq boom in the late nineties. So

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Speaker 2: evis is as narrow as it has been?

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Speaker 3: That begs the question, then I must you pretty fragile?

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Speaker 2: Possibly it really depends on is artificial intelligence the Internet,

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Speaker 2: in which case it's not, or is artificial intelligence blockchain

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Speaker 2: or the metaverse, in which case it most certainly is

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Speaker 2: very fragile. And those of the questions which lots of

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Speaker 2: very smart people are grappling with and have varying views on.

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Speaker 2: Over Market's views pretty clear?

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Speaker 3: Have you got an answer?

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Speaker 2: No clear answer, But I think what we're just starting

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Speaker 2: to see the beginnings of a little bit of skepticism

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Speaker 2: because the question is you're seeing a trillion dollars plus

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Speaker 2: invested in the infrastructure for artificial intelligence, and you're just

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Speaker 2: starting to see the question be raised, i think this

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Speaker 2: week by albans and City Group in the US, whatever returns,

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Speaker 2: what's the use case for all of US investment? Are

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Speaker 2: you going to get a ten percent return on capital

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Speaker 2: out of US? And that's a tough question. Some of

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Speaker 2: the builders of all of US infrastructure going to get

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Speaker 2: those returns. So if you look at say in for

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Speaker 2: ATILL and CDC, if I've locked in very long term

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Speaker 2: contracts with big, deep pocketed counterparties, so they'll be fine,

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Speaker 2: I'll get the return, it's just the counterparty who's in

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Speaker 2: the data center of it. Maybe they will in five

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Speaker 2: years time, maybe they won't. And that's a difficult question.

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Speaker 1: How much of it do you think so far to

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Speaker 1: date has actually been driven by earnings? Obviously in Vidia

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Speaker 1: has outperformed, but from now on, the expectations to continue

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Speaker 1: to outperform on top of that just get higher. So

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Speaker 1: how much is earning's been part of this play in

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Speaker 1: thematic so far?

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Speaker 3: And how much of it do you think it will

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Speaker 3: be going forwards.

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Speaker 2: Earnings matter, but there's been tremendous multiple expansion and also

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Speaker 2: in this phase your earnings quality perhaps you're just a

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Speaker 2: little bit questionable. So for for example, where the company

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Speaker 2: buys a whole lot of in vidio GPUs, they will

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Speaker 2: know that will be a capital investment by them which

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Speaker 2: they have a depreciate over many years. Where's in video

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Speaker 2: reports all the earnings obviously in the in the year,

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Speaker 2: but they sell over GPUs, I mean, which is fine,

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Speaker 2: that's the way it is. But when you're in this

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Speaker 2: rapid growth phase, that can tend to goose the earnings a.

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Speaker 4: Little bit of the of the key providers.

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Speaker 2: So it's partly earnings, partly earnings momentum. For example, we've

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Speaker 2: seen Tesla rally forty forty five percent in the last

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Speaker 2: few weeks on less bad than expected quarterly guidance.

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Speaker 1: That's not good guidance. There's just less poor right exactly.

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Speaker 2: So earnings has something to do with it, but there's

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Speaker 2: a lot of hype as well. A lot of hype

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Speaker 2: and a lot of them meantum and a lot of

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Speaker 2: current money.

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Speaker 4: They are driving it too.

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Speaker 1: You work with Morgan Stanley, they take care of your

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Speaker 1: global equity for shares funds. Mike Wilson, the head of

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Speaker 1: US Equity Strategy, has suggested that we could be on

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Speaker 1: course for a comedown, that a correction in the double

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Speaker 1: digits in the US markets is not unlikely ahead of

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Speaker 1: the U S election.

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Speaker 3: You and that by with them, do you.

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Speaker 4: Agree it's a perfectly reasonable call.

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Speaker 2: There's two parts to the US market, right There's magnificent

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Speaker 2: seven and that could keep going or it could fall

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Speaker 2: away very quickly.

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Speaker 4: We all know when we're older.

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Speaker 2: It's picking the end of what maybe abobble was incredibly hard,

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Speaker 2: so it could keep running for some time. And then

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Speaker 2: there's the rest of the US market, where via economy

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Speaker 2: is now unequivocally slowing as the impact of FED rate

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Speaker 2: hikes in the past are finally taking effect. I've been

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Speaker 2: sheltered for a long time by recklessly lose fiscal policy

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Speaker 2: over there, but now it's really starting to feed through

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Speaker 2: to verr economy. So areas, for example, like a home

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Speaker 2: building are really starting to come quite quickly off for

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Speaker 2: boil in parts of retail in the US are really

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Speaker 2: slow and quite quickly as well.

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Speaker 1: This is a really interesting point, Matt, because if you

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Speaker 1: look on the face of it, if you look at

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Speaker 1: market returns, they look incredible, right, Obviously we know that

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Speaker 1: that is narrowly driven by a few magnificent stocks. But

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Speaker 1: it's not actually a story of economic expansion, is it.

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Speaker 1: So what it looks like on the tin is not

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Speaker 1: actually what's happening underneath, right.

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Speaker 2: Well, it depends where we're into with what the magnificent

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Speaker 2: seven are doing. So, for example, with artificial intelligence, if

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Speaker 2: we can find the use cases and costs can rapidly

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Speaker 2: scale and come down, then it will ultimately be a

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Speaker 2: story of economic expansion. But that's the question, and we're

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Speaker 2: just starting to see some people ask it for the

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Speaker 2: first time. Really, Rather than just roll with the flow

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Speaker 2: the insnet, it was a lot simpler. When the Internet

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Speaker 2: became fast enough, was incredibly disruptive to existing business models,

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Speaker 2: dramatically lower the cost of doing business. There use cases galore.

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Speaker 2: With AI, it's you know, it's just a little bit

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Speaker 2: more of an open question at this point. So it

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Speaker 2: could spark rapid future growth, but can it lift productivity

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Speaker 2: in a manner it's cost effective, And that's the open question. Well,

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Speaker 2: I think ultimately determine how you do from investing in

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Speaker 2: Nvidia and some of those other stocks at this level,

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Speaker 2: you know, and similarly Tesla you'd have to stave at.

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Speaker 2: Electric cars have sparked a lot of growth, but it's

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Speaker 2: fascinating the share prices really so sharply at a time

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Speaker 2: an electric car sales are falling off a cliff, and

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Speaker 2: it's hard, it's only really hot. It's partly a cycle,

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Speaker 2: and it's partly the fact that hybrids have become the

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Speaker 2: go to.

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Speaker 1: But isn't that because investors now will least some believe

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Speaker 1: that that Tesla could be a strong AI play.

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Speaker 2: Possibly it's a very interesting but yeah, but that's not there.

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Speaker 2: Their core current business is the building of cars and

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Speaker 2: the building of batteries.

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Speaker 1: Believe or not, I actually am an optimist, even though

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Speaker 1: I sound very much like a cynic in this conversation Matt.

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Speaker 1: But I think it's an important question that we ask

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Speaker 1: who's holding the bag if.

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Speaker 3: This does all go wrong for US markets.

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Speaker 1: We know that retail investors, the so called dumb money

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Speaker 1: I hate that term, but it is a term has

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Speaker 1: piled into Nvidia, especially this year. I know someonstos that

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Speaker 1: are shorting it. I also know some that along but

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Speaker 1: I certainly know some that are shorting it. So if

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Speaker 1: this does all go sideways, who's going to be holding

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Speaker 1: that bag?

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Speaker 4: Yeah? Well, I don't know.

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Speaker 2: If it there's too many who's shorten it who are

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Speaker 2: still going to be alive. That's a very hard road.

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Speaker 4: Look.

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Speaker 2: In the US, institutional investors are a large, much larger

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Speaker 2: proportion of a market than they are in New Zealand.

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Speaker 2: The US is a massive domestic market, so domestic US

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Speaker 2: institutions are a huge proportion passive. Obviously they have to

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Speaker 2: own a proportion of the index and do and a

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Speaker 2: significant amount a very light footed quant money and some

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Speaker 2: a range of active funds which have positions all over

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Speaker 2: the map, and then obviously retail. It's one of the

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Speaker 2: other fascinating themes outside the Magnificent seven is despite money

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Speaker 2: getting a lot tired of, has been this meme stock

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Speaker 2: resurgence this year in names that have no fundamental basis whatsoever.

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Speaker 2: Everyone knows are a Pyramids game, but people have been

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Speaker 2: willing to play it.

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Speaker 1: You're not buying game stop, then you're not buying game stoping.

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Speaker 4: No, but certainly not shorten it either.

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Speaker 1: Just don't play that game. I get it. It's a

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Speaker 1: dangerous rule watch from a distance from the sidelines. We

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Speaker 1: were talking about this a little earlier on what I

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Speaker 1: think has really been shown this year is also this highlighting,

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Speaker 1: this picking winner strategy because the people who would have

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Speaker 1: been an nvidio early would have made absolute bank.

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Speaker 3: What do you think this has done for that whole?

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Speaker 1: This year has done for that whole active versus passive movement?

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Speaker 1: And if things don't work out with this magnificent seven,

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Speaker 1: could that mean that active is over?

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Speaker 2: By and large It's been tricky for active. A lot

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Speaker 2: of traditional active managers I think have been caught a

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Speaker 2: little bit by the extent to which these stocks have

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Speaker 2: gone as passives obviously just owned it and more momentum

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Speaker 2: based money's done pretty well out of jumping on the theme.

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Speaker 2: The question will be, though, is when the tide does

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Speaker 2: go out, and it will one day, who's naked? And

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Speaker 2: that I think will be the real acid test for

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Speaker 2: the active versus passive debate, because if active can't add

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Speaker 2: value when things do change, that's when it will be

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Speaker 2: quite tricky for it, I think as a thematic versus

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Speaker 2: passive or as an investment.

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Speaker 1: Style rather so, really the real test for active managers

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Speaker 1: will be if this doesn't work out and if things

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Speaker 1: start falling.

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Speaker 2: Exactly when things get choppier, when we have a decent pullback,

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Speaker 2: which will happen at some point, it's been a long

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Speaker 2: time since last ten percent plus pullback, that'll be I

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Speaker 2: think the acid test for active you'd better hope it

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Speaker 2: not average it outperformancen.

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Speaker 1: What could trigger a double digit downturn? You've said there

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Speaker 1: that you don't think that's outside of reality. Would it

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Speaker 1: be a US election, Would it be an oil crisis?

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Speaker 1: What if anything could cause that?

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Speaker 4: There's probably three key things.

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Speaker 2: One is, for US economy slows even faster and is

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Speaker 2: generally expected right now, and you start seeing really disappointing

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Speaker 2: earnings outcomes obviously outside the magnificent seven, they could certainly

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Speaker 2: trigger it.

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Speaker 4: Secondly, if rate cuts disappoint.

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Speaker 2: The fair does look poised to potentially cut rates, but

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Speaker 2: they've got the problem of Donald Trump looks likely to

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Speaker 2: assume the presidency, and if Republicans get both houses, you

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Speaker 2: could have a massive negative supply side shock for the

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Speaker 2: US economy via significant.

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Speaker 4: Immigration curves, big tower.

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Speaker 2: Big tariff, So they will be some highly inflationary which

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Speaker 2: puts you an incredibly difficult position as the FED, as

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Speaker 2: it makes it very hard to cut into a slowing economy.

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Speaker 2: So that I think is going to be quite a

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Speaker 2: tricky point in the macro for the US market in

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Speaker 2: the next few months. So the politics are almost going

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Speaker 2: to matter as much as the economics. There's also I

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Speaker 2: think significant risk around the US fiscal position. They are

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Speaker 2: running a cyclically adjusted deficit of six seven percent of GDP.

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Speaker 2: That deficit will only grow if there's every decent recession

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Speaker 2: in the US as reckless fiscal policy, which navarating agencies

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Speaker 2: who have downgraded the US have said, part of reason

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Speaker 2: I've done so as there's no institutional capability to run

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Speaker 2: that fiscal policy in So that's a danger in time,

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Speaker 2: so you'd probably see longer term bondyrds rise in that scenario.

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Speaker 2: And probably the other thing is purely on Magnificent seven.

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Speaker 2: We're just starting to see these questions asked, what is

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Speaker 2: the use case whatever returns to the investment. On the

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Speaker 2: other hand, if a video comes out with a far

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Speaker 2: better chip, it's far faster, then no one can only think,

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Speaker 2: you know, we might share price go then, so you know,

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Speaker 2: you never want to underestimate technological process it's very easy

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Speaker 2: to look at the multiples get or bearish and not

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Speaker 2: understand that, you know, just the rapidity of a tech

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Speaker 2: progress that can be made and the use cases that

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Speaker 2: develop from it. So while we sort of look at

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Speaker 2: it and scratch your head, you just you have to

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Speaker 2: be a little bit careful and think about what could

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Speaker 2: be if things go right.

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Speaker 3: Of course, there's the pricing in the market.

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Speaker 1: Then there's the actually the actual underlying business that you

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Speaker 1: will need to take into account as well. Everything you've

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Speaker 1: just listed off there, though, those are all questions of

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Speaker 1: play in the market, and investors hate uncertainty. How are

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Speaker 1: prices and valuations where they are now when there's all

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Speaker 1: of those enormous questions political questions at play.

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Speaker 2: Yeah, no, it's a very good question. Whichever way you

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Speaker 2: cut it. The US market does look very expensive, whether

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Speaker 2: it's on various valuation ratios. One indicator people will occasionally

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Speaker 2: look at as the so called buffet indicator, which is

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Speaker 2: total US market cap to GDP. It's just set a

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Speaker 2: new all time record. However, and when interest rates with

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Speaker 2: zero now, part of that's because the market's dere part

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Speaker 2: of that's because more of the US business sector is

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Speaker 2: listed than.

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Speaker 4: It used to be.

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Speaker 2: But you make of that what you Well, the multipools

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Speaker 2: are up there. People are believing in good case outcomes.

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Speaker 2: Maybe they will come about. But if they don't, that's

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Speaker 2: where the risk lies.

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Speaker 1: On the spectrum of bull to bear and Matt, we're

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Speaker 1: are you sitting currently square in the middle? Oh, you're

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Speaker 1: allowed to be if you could lean one way.

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Speaker 2: It depends on by market. I think for the US

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Speaker 2: markets moderately bearish, but I certainly have to say from

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Speaker 2: here where's Conversely, for the much benighted Kiwi market, which

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Speaker 2: has struggled for years, have to say moderately bullish from

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Speaker 2: here as we enter a finally enter a rate cut cycle.

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Speaker 4: So yeah, quite a divergence.

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Speaker 1: Well perfect, because I was going to ask you about

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Speaker 1: our market just while I have you chicily, when do

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Speaker 1: you think the Reserve Bank may actually cut rates? Are

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Speaker 1: you in the November camp? Do you think earlier as

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Speaker 1: a possibility.

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Speaker 4: Yeah? It's interesting, isn't it.

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Speaker 2: They're quite material in their decision making, being surprisingly hawkish

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Speaker 2: in may to giving a speech walking that back partially

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Speaker 2: last month and now walking it back further yesterday. What

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Speaker 2: we think they should do as a first cut in August.

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Speaker 2: What I'll probably do is really set the groundwork for

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Speaker 2: it in August and then possibly even do fifty in November.

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Speaker 2: Certainly twenty five, recive the market's pricing about sixty by

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Speaker 2: November with fifty percent chance of a cut in August,

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Speaker 2: as we have a market's pricing it this morning now.

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Speaker 2: And what's changed is we've seen the economy slowing for

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Speaker 2: quite some time, but inflation has been really sticky. Finally,

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Speaker 2: over the last few weeks, I've started to see some

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Speaker 2: evidence that inflation's finally coming down, So I mean, have

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Speaker 2: a medicine's finally doing its job.

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Speaker 1: So you think they're going to signal pretty hard over

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Speaker 1: the next few months and then we'll see something if

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Speaker 1: we do.

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Speaker 3: When of what size are you talking about?

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Speaker 2: I would hope they do twenty five and twenty five.

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Speaker 2: I suspect what may happen is fifty in November. But

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Speaker 2: it's going to be data dependent. There's going to be

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Speaker 2: a lot more data to come out, and are clearly

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Speaker 2: paying attention to things like you know, a monthly AM

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Speaker 2: their Business Outlook survey, have a messy university GDP and

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Speaker 2: inflation now data those sorts of things so now, which

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Speaker 2: is good. You never made a mistake in May. It's

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Speaker 2: good they haven't dug themselves a whole. I've looked at

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Speaker 2: the evidence and they've changed their view.

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Speaker 1: A fifty basis point cut, on the face of it

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Speaker 1: could be quite shocking, but the market's already pricing it,

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Speaker 1: so it would unlocks be unlikely to change anything.

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Speaker 4: If they don't do fifty.

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Speaker 2: If we see a surprisingly higher inflation outcome, you know,

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Speaker 2: that's yeah, that's where things change again, you know. And

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Speaker 2: the market's pricing mid hundreds over the next twelve to

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Speaker 2: eighteen months, what does it take us back to sort

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Speaker 2: of a four to low fours for the ocr What.

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Speaker 1: Does it say to you the fact that the market

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Speaker 1: for months has been pricing rate cuts and way ahead

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Speaker 1: of what the Reserve Bank itself has been forecasting.

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Speaker 2: If the market is an excellent wayne machine at times,

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Speaker 2: and I think on this time, this occasion, the market's.

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Speaker 4: Got it right.

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Speaker 2: And fortunately of the Reserve Bank, while they had it wrong,

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Speaker 2: has seen the evidence and changed your view. So at

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Speaker 2: one point it's frustrating and sort of puzzling at VMA's

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Speaker 2: statement and just what economic models we are using.

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Speaker 4: But thankfully I've looked at the evidence and changed your view.

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Speaker 1: Now I do just want to go back to the

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Speaker 1: New Zealand equity market, because before I came down here, Matt,

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Speaker 1: I just had a quick look at the latest on

359
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Speaker 1: your long short funds. Your largest long position is on

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Speaker 1: our insurance company, Tower, and I've just released an insurance episode,

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Speaker 1: so my head is still full of all of the

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Speaker 1: complexities of insurance. Please give us your brief bullcase for Tower.

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Speaker 2: Yeah, we were right a bit early on it.

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Speaker 4: It has fair to say it hasn't always on you

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Speaker 4: forgetting that well, but it's.

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Speaker 2: Been a phenomenal performer the last few months. Look, insurance

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Speaker 2: is a classic cycle, and they were caught by rapidly

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Speaker 2: rising claims cost inflation. And you can only reprice for

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Speaker 2: that gradually as your policies roll over over the course

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Speaker 2: of the year and revery. Insurance costs went through the roof,

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Speaker 2: and they had a whole series of events. Crime was

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Speaker 2: significantly higher in their assumptions, so both it wasn't just

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Speaker 2: the cost of the claims, it was the quantity of

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Speaker 2: the claims. Is way higher than I'd expected when the

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Speaker 2: insurance was priced.

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Speaker 3: None of this is sizing up to a billcase man.

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Speaker 2: But of course, what's finally happened, if you could look

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Speaker 2: forward twelve to eighteen months and see it in slow motion,

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Speaker 2: is that they've been able to reprice for the cost inflation.

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Speaker 2: I've been able to reprice for the greater quantity of

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Speaker 2: claims and for the higher reinsurance costs. And just as

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Speaker 2: I've gone through repricing all of that, suddenly have a

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Speaker 2: reinsurance costs starting to not go up as quickly, for

384
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Speaker 2: quantity of claims has stopped rising, and claims cost inflation

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Speaker 2: isn't as nasty as it was. And then the cherry

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Speaker 2: on top is after several years where we had a

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Speaker 2: series of catastrophes, this year have been none, so they

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00:20:38,119 --> 00:20:43,119
Speaker 2: have a very significant retained deductible that they pay a

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Speaker 2: first hit on major earthquakes, floods, what have you. So

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Speaker 2: there could be a very significant profit instrument as well.

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Speaker 2: So yeah, in our view, it still looks very interesting.

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Speaker 2: But it is a classic cyclical, and it's finally gotten

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Speaker 2: on to the right part of a cycle. It's not

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Speaker 2: widely followed, so I don't think people sort of just

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Speaker 2: really cut it onto the earnings power. You know that

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Speaker 2: they're going to have for the share in the next

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Speaker 2: couple of years.

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Speaker 1: Focusing on the same fund, but looking at the flip side,

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Speaker 1: you're shortening the likes of the Commonwealth Bank of Australia.

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Speaker 1: But also interestingly wes Farmers, which owns Bunnings and km Art,

401
00:21:19,480 --> 00:21:24,120
Speaker 1: they've had pretty incredible times worth spending given that they

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Speaker 1: are cheaply priced. So what makes you not like that stuff.

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Speaker 2: We's Farmers is a great business. Camart's a great business.

404
00:21:30,359 --> 00:21:31,119
Speaker 2: My wife loves it.

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Speaker 3: I find that's a signal to her to stop spending.

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Speaker 4: There now she can spend there as much as you are.

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Speaker 4: It's so cheap.

408
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Speaker 3: Very true that.

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Speaker 2: The issue is bunning. The Australian economy is a bit

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Speaker 2: behind us. The RBA was slow to titan, probably even

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00:21:49,720 --> 00:21:53,600
Speaker 2: has to tighten forever even as we ease. Bunnings has

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Speaker 2: gone ex grift for at least several years, and that's

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Speaker 2: by far the biggest business of wes Farmers. And at

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Speaker 2: the same time time, weez Farmers is at load of

415
00:22:02,000 --> 00:22:05,399
Speaker 2: mid thirties pe multiples, way more expensive than it was

416
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Speaker 2: even when bond yards were zero.

417
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Speaker 4: So it's a great business and it's growing, but it's still.

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Speaker 2: Relatively small in the whole, and they've also invested a

419
00:22:13,960 --> 00:22:16,520
Speaker 2: significant amount in a liftium business, and it's a good

420
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Speaker 2: liftium business, but lithium's lithium is a very abundant element

421
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Speaker 2: in the UF's crust and all of those people who

422
00:22:22,760 --> 00:22:25,280
Speaker 2: are bullished on lithium and now finding that out, so

423
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Speaker 2: it's going to be very hard to make money out

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Speaker 2: of that.

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Speaker 1: So shortening Weeze Farmers kind of speaks to that whole

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Speaker 1: conversation we've just had about the fact that it may

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Speaker 1: be a great business and people are still spending there,

428
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Speaker 1: but its price is ultimately unattractive right now, Oh.

429
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Speaker 2: That's right, Yeah, that's right, and possibly a little bit

430
00:22:41,520 --> 00:22:46,160
Speaker 2: of earn intersk as the Australian cycle slows down at

431
00:22:46,160 --> 00:22:48,199
Speaker 2: a time when it's an all time record multiples. So

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Speaker 2: it's certainly sometimes when you short things, you look for

433
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Speaker 2: high multiples and downgrade risk and it fits into that camp.

434
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Speaker 2: And other times you look for busted businesses which could

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Speaker 2: potentially go to zero, although you have to be very

436
00:23:02,080 --> 00:23:04,480
Speaker 2: careful of because if you get that wrong, they can

437
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Speaker 2: rise very significantly as well.

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Speaker 1: We may have to do another future episode and buster

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00:23:08,520 --> 00:23:10,760
Speaker 1: businesses that'd be awesome. Thank you so much your time

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Speaker 1: that I really appreciate it.

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Speaker 4: Thanks for coming in