WEBVTT - JPMorgan Investor Day, Iran Latest 0:00:02.920 --> 0:00:08.680 Bloomberg Audio Studios, podcasts, radio news. 0:00:09.960 --> 0:00:13.840 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:00:13.920 --> 0:00:16.960 weekdays at ten am Eastern on Appo, CarPlay, and rout 0:00:17.000 --> 0:00:20.120 Otto with the Bloomberg Business app. Listen on demand wherever 0:00:20.160 --> 0:00:24.000 you get your podcasts, or watch us live on YouTube. 0:00:24.880 --> 0:00:26.840 All right, let's check in with Alison Williams. She covers 0:00:26.840 --> 0:00:30.680 the banks for Bloomberg Intelligence. In One of the big 0:00:30.720 --> 0:00:34.280 banks is JP Morgan, and they're having their investor day today. Allison, 0:00:34.520 --> 0:00:36.560 give us what have you learned from our good friends 0:00:36.560 --> 0:00:38.519 at JPM today at their investor day. 0:00:39.880 --> 0:00:42.120 So I think, you know, the most important thing is 0:00:42.159 --> 0:00:47.240 they're keeping their long term seventeen percent targets and then 0:00:47.680 --> 0:00:50.240 sort of supporting that they did up their net interest 0:00:50.320 --> 0:00:53.479 income guidance. We don't think that there's going to be 0:00:53.880 --> 0:00:57.440 much change to I guess the consensus, because I think 0:00:57.440 --> 0:01:00.600 consensus is already there. So they up the guide ends 0:01:00.680 --> 0:01:04.200 to reflect fewer cuts. But we already knew that they 0:01:04.280 --> 0:01:07.880 also up their expense guidance. Again, we knew that because 0:01:07.880 --> 0:01:11.480 they you know, have already flagged that they're going to 0:01:11.600 --> 0:01:16.760 have a gain from some visa shares and they're going 0:01:16.840 --> 0:01:21.520 to use some of that to pre fund investment, spending 0:01:21.600 --> 0:01:27.000 some charitable contributions, and then finally, you know, they did 0:01:27.080 --> 0:01:31.720 some math walking through capital. So Basil three endgame is 0:01:31.760 --> 0:01:35.319 the big question. They looked like they would be short 0:01:35.560 --> 0:01:39.120 based on the last proposals that we had that we 0:01:39.160 --> 0:01:43.040 got last July, but Powell has said that we're going 0:01:43.080 --> 0:01:46.160 to see big changes, and so JP Morgan did some 0:01:46.200 --> 0:01:50.000 scenario analysis around that, and you know, they feel pretty 0:01:50.040 --> 0:01:54.400 comfortable and they're starting to increase their buybacks and there 0:01:54.480 --> 0:01:56.400 is a lot more to come if we do get 0:01:56.400 --> 0:01:58.240 some relief to that proposal. 0:01:58.960 --> 0:02:01.800 Also, aside is down like half a percent. Did do 0:02:01.880 --> 0:02:03.960 I take away anything from that in terms of how 0:02:04.000 --> 0:02:06.240 investors perceive the numbers? 0:02:07.440 --> 0:02:09.600 I mean, I would say that we didn't get any 0:02:09.680 --> 0:02:12.680 big positive surprises. So I think that's what the stock is, 0:02:12.960 --> 0:02:15.680 you know, telling you, as I said, they they up 0:02:15.680 --> 0:02:19.160 there in an interest income guidance, but consensus was already there. 0:02:19.639 --> 0:02:23.119 We already knew that there were less federate cuts expected, 0:02:23.160 --> 0:02:27.720 and so they just kind of guided to that. And 0:02:27.760 --> 0:02:30.840 then you know, they there were questions around their target, 0:02:30.880 --> 0:02:33.200 but they were so far above that last year. They're 0:02:33.240 --> 0:02:36.240 operating at such a high level, and again consensus is 0:02:36.280 --> 0:02:40.000 already expecting them to beat that target this year. So nothing, 0:02:40.280 --> 0:02:44.160 I think, no real big surprises. I think the next 0:02:44.520 --> 0:02:46.760 you know, I guess new news if you will, that 0:02:46.840 --> 0:02:50.280 we will get o the stress tests in June, where 0:02:50.639 --> 0:02:54.320 Jason Morgan said today they actually expect their stress buffer 0:02:54.400 --> 0:02:57.720 their requirement to go up. So I think setting that 0:02:57.880 --> 0:03:01.280 guideline it sets them up to either you know, meet 0:03:01.360 --> 0:03:04.200 or surprise positively. And then when we do get those 0:03:04.240 --> 0:03:06.959 guidelines the summer on, buzzle through the endgame to see, 0:03:07.480 --> 0:03:10.000 you know, what the big changes are and if we 0:03:10.040 --> 0:03:13.000 are going to get uh some of the reliefs that 0:03:13.919 --> 0:03:17.320 everyone basically expects after Powell has made those comments. 0:03:17.760 --> 0:03:19.680 You know, Alex, you mentioned this stocks down about half 0:03:19.680 --> 0:03:22.240 a percent today, but intra day earlier this morning hit 0:03:22.320 --> 0:03:25.800 an all time high. Fair enough, all he's unbelievable five 0:03:25.880 --> 0:03:29.120 hundred and eighty five billion dollars in market cap, Alison 0:03:29.160 --> 0:03:32.680 interest to refresh our memory, where are we in terms 0:03:32.760 --> 0:03:35.640 of our discussion of succession for Jamie Diamond? Is that 0:03:35.680 --> 0:03:37.920 even on the table anymore? We just where are we 0:03:37.960 --> 0:03:38.120 in that? 0:03:39.400 --> 0:03:39.560 You know? 0:03:39.680 --> 0:03:42.600 I think that you know, they're sending more and more 0:03:42.640 --> 0:03:46.720 clear message. Today, having Dan Pinto, you know, sort of 0:03:46.720 --> 0:03:49.440 walk through some of the opening remarks, I think that 0:03:50.640 --> 0:03:53.840 you know more and more that really they've they've sort 0:03:53.880 --> 0:03:57.080 of made clear the plan. You know, Jamie has the 0:03:57.160 --> 0:04:00.320 running joke about the five years, although you know, more 0:04:00.360 --> 0:04:04.000 recently it seems like he has talked about getting a 0:04:04.040 --> 0:04:07.560 little bit closer towards that goal. But I think really 0:04:07.640 --> 0:04:11.560 at these investor days you see what a strong bench 0:04:11.640 --> 0:04:15.960 they have on display. We already heard, you know, from 0:04:16.200 --> 0:04:23.440 Marion Airdose and we heard from Marion Lake who runs 0:04:23.440 --> 0:04:27.440 a consumer business. And really, I mean the strength in 0:04:27.520 --> 0:04:31.640 these stories. There's so much positive going on, you know, 0:04:31.760 --> 0:04:36.320 just continuing to invest for growth, you know, net influence 0:04:36.360 --> 0:04:39.000 in the asset management business, building out branches in the 0:04:39.040 --> 0:04:43.159 consumer business. You know, a lot of positive things going 0:04:43.160 --> 0:04:45.520 on the business lines, and again a strong bench. 0:04:46.720 --> 0:04:48.680 Before I let you go, have you learned anything about 0:04:48.680 --> 0:04:52.039 investment banking, what the IPO looks like, what the M 0:04:52.040 --> 0:04:54.440 and A market looks like. We're still waiting for that 0:04:54.520 --> 0:04:56.400 turnaround moment, any word on that. 0:04:57.720 --> 0:05:01.200 So that's I think all coming up on the agenda. 0:05:02.480 --> 0:05:04.359 As I said, just so far, we really have just 0:05:04.400 --> 0:05:07.520 been focusing on the asset and wealth and the consumer side. 0:05:07.839 --> 0:05:10.919 But I think we'll definitely be digging into the details 0:05:10.920 --> 0:05:12.520 and that in the next few sessions. 0:05:12.880 --> 0:05:14.760 Excellent, all right, Alison Williams, thank you so much. We 0:05:14.760 --> 0:05:17.240 really appreciate you stepping out and chatting with us. Alison 0:05:17.279 --> 0:05:21.839 Williams is Bloomberg Intelligence Senior US Banks analyst. He also 0:05:21.880 --> 0:05:25.480 covers basically anything that handles money, so she's very helpless manager, 0:05:25.760 --> 0:05:26.360 you name it. 0:05:37.240 --> 0:05:41.119 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:05:41.200 --> 0:05:44.720 weekdays at ten am Eastern on applecar Play and Android 0:05:44.760 --> 0:05:47.520 Auto with the Bloomberg Business app. You can also listen 0:05:47.640 --> 0:05:50.720 live on Amazon Alexa from our flagship New York station. 0:05:51.120 --> 0:05:53.800 Just say Alexa Play Bloomberg eleven. 0:05:53.600 --> 0:05:57.520 Thirty tatty Monday. I'm Alex Stee alongside Paul Sween need this. 0:05:57.520 --> 0:05:59.760 In Bloomberg Intelligence Radio, we bring you all the top 0:05:59.800 --> 0:06:02.160 news and finance and economics through our lens of our 0:06:02.160 --> 0:06:05.120 Bloomberg Intelligence analysts. They cover two thousand companies in one 0:06:05.200 --> 0:06:08.680 hundred and thirty industries worldwide. We also take you outside 0:06:08.720 --> 0:06:11.520 Bloomberg Intelligence and get a look at under the hood 0:06:11.560 --> 0:06:13.440 and on the street and saying, hey, what are you 0:06:13.480 --> 0:06:15.839 doing with your money. It is very clear that we're 0:06:15.839 --> 0:06:17.920 in an everything rally when it comes to metals and 0:06:17.960 --> 0:06:19.839 when it comes to the equity markets. John Tucker was 0:06:19.880 --> 0:06:23.719 just saying, adding twelve trillion dollars in value since the 0:06:24.320 --> 0:06:26.359 since the S and P bottom back in October. So 0:06:26.839 --> 0:06:28.960 what's going to disrupt that? I honestly don't have a 0:06:28.960 --> 0:06:32.120 good answer, but maybe Dana Dioria does, co chief investment 0:06:32.160 --> 0:06:35.719 Officer over at invest net Is invest net I got 0:06:35.720 --> 0:06:37.800 there is standing by Dana. What stops it? 0:06:39.839 --> 0:06:40.000 Hi? 0:06:40.040 --> 0:06:40.880 Thank you for having me. 0:06:41.400 --> 0:06:44.520 Well, yeah, I mean we've definitely sort of get it 0:06:44.520 --> 0:06:49.239 over to this idea that you know, the resilience. 0:06:48.720 --> 0:06:51.240 Is the name of the game. The markets are doing well, 0:06:51.880 --> 0:06:52.840 we're seeing breath. 0:06:53.040 --> 0:06:55.919 It's not just you know, obviously the Magnificent seven, but 0:06:55.960 --> 0:06:59.039 I do look, I mean there are definitely cracks that 0:06:59.040 --> 0:07:02.560 could potentially and become more of an issue, and and 0:07:03.000 --> 0:07:05.159 you know, one of them, of course, at a high level, 0:07:05.240 --> 0:07:08.719 is just the election coming up and the volatility that's 0:07:08.720 --> 0:07:10.880 going to be coming into markets as a result of that. 0:07:10.960 --> 0:07:13.600 I think as the election season heats up, and that's 0:07:13.600 --> 0:07:13.920 not to. 0:07:13.880 --> 0:07:17.080 Say, you know, one winner versus another, there will be 0:07:17.120 --> 0:07:20.360 definite winners and losers based on how the election pans out. 0:07:20.920 --> 0:07:23.320 But I think as we head into the election, expect 0:07:23.320 --> 0:07:26.600 more volatility, uh in markets. And then of course, you 0:07:26.640 --> 0:07:30.440 know jobs, Employment obviously is a big one. You know, 0:07:30.520 --> 0:07:32.600 we're not we're not seeing any real cracks there, but 0:07:32.680 --> 0:07:34.920 if there were to be, that would be an issue. 0:07:35.400 --> 0:07:38.720 And growth obviously came in this you know, last quarter 0:07:38.880 --> 0:07:40.560 a little lower than expected as well. 0:07:41.600 --> 0:07:44.360 Dana, it seems like some recent move we've seen off 0:07:44.400 --> 0:07:47.280 that April kind of weakness was maybe driven by good 0:07:47.280 --> 0:07:49.680 old fashioned earnings. What did you take away from the 0:07:49.680 --> 0:07:52.000 most recent earning cycle? Again, we have another big name 0:07:52.360 --> 0:07:54.240 reporting ondesday after the close with Nvidia. 0:07:56.120 --> 0:07:59.120 Yeah, I mean, earnings has been what's been propping up 0:07:59.280 --> 0:08:01.560 the account of me right alongside employment. 0:08:01.680 --> 0:08:04.640 I think the fact that you know, we haven't. 0:08:04.360 --> 0:08:07.120 Seen the weakness yet on the corporate side, we have 0:08:07.280 --> 0:08:11.080 seen productivity kind of holding steady. Now that being said, 0:08:11.200 --> 0:08:13.960 you know, the market to a large extent, I would say. 0:08:13.800 --> 0:08:15.760 Has been sort of priced for an expectation. 0:08:16.400 --> 0:08:19.600 So you know, individually, when you see anybody kind of 0:08:19.640 --> 0:08:22.480 coming in not at you know exactly where it needs 0:08:22.480 --> 0:08:25.240 to be your beating, you know, they kind of get punished, 0:08:25.280 --> 0:08:27.200 and I expect that we continue, you. 0:08:27.120 --> 0:08:28.559 Know, into next quarter as well. 0:08:28.760 --> 0:08:33.640 But yeah, earnings have definitely bullied us for you know, 0:08:33.720 --> 0:08:34.319 not even just. 0:08:34.280 --> 0:08:36.839 This last quarter, but in general if you look back 0:08:36.840 --> 0:08:37.920 to twenty twenty three. 0:08:38.120 --> 0:08:40.040 Right, which makes it so hard to then sell because 0:08:40.040 --> 0:08:41.600 if you take a look at say the EA function 0:08:41.640 --> 0:08:44.800 on the Bloomberg terminal, and you look at earnings and 0:08:44.880 --> 0:08:48.120 sales growth year on year, excuse me, quarter on quarter 0:08:48.480 --> 0:08:51.640 over the next year, it just keeps going up. So 0:08:51.800 --> 0:08:54.080 it's hard for me to then defind the reason to 0:08:54.200 --> 0:08:59.120 then sell. How do you look at the next four quarters? 0:08:59.679 --> 0:09:01.240 Yes, So one of. 0:09:01.200 --> 0:09:04.200 The things I would differentiate, of course, is you know, 0:09:04.360 --> 0:09:08.640 size of companies interest rate. You know, how dependent is 0:09:08.640 --> 0:09:11.640 that company I'm going to capital markets, for example, in 0:09:11.679 --> 0:09:12.400 an environment of. 0:09:12.440 --> 0:09:14.199 Higher for longer for example. 0:09:13.840 --> 0:09:16.920 Small caps tend to be you know, more interest rates sensitive. 0:09:17.320 --> 0:09:19.880 If you're going to look individually just who who's. 0:09:19.640 --> 0:09:22.920 Able to fund self fund versus not so in an 0:09:23.000 --> 0:09:26.280 environment that's higher for longer and as corporate debt starts 0:09:26.360 --> 0:09:28.640 rolling over. I do think that's one area if for 0:09:28.920 --> 0:09:30.800 you know, as we're talking about it, to say, okay, 0:09:31.480 --> 0:09:33.720 this is a place where weakness can come in on 0:09:33.760 --> 0:09:36.600 the corporate side, because these companies do have to return 0:09:36.640 --> 0:09:39.040 to capital markets and roll over debt at higher rates 0:09:39.080 --> 0:09:41.520 than they've needed to in the past, higher rates than 0:09:41.640 --> 0:09:44.120 you know, they've needed to in a decade. Right, So 0:09:44.600 --> 0:09:47.520 I do think that's that's one thing. Now, that being said, 0:09:48.400 --> 0:09:50.959 I am a proponent of small caps. I just think 0:09:51.000 --> 0:09:53.000 you have to be able to buy in and hold 0:09:53.040 --> 0:09:55.680 on because I think the market has priced in that 0:09:55.800 --> 0:09:57.360 scenario for them. 0:09:57.920 --> 0:10:01.160 Data in a fixed income side, how much risk are 0:10:01.160 --> 0:10:03.000 you suggesting people take because we can sit in to 0:10:03.080 --> 0:10:05.360 your treasure. You can get four point eight three percent today. 0:10:05.920 --> 0:10:07.880 How much credit should I be taking out there? 0:10:09.520 --> 0:10:12.640 Yeah? I mean, you know, it's a it's it's a 0:10:12.640 --> 0:10:15.520 funny thing, right, Suddenly you're getting paid whereas you weren't 0:10:15.520 --> 0:10:17.520 for a long time in the fixed income space, and 0:10:17.559 --> 0:10:19.600 you really don't need to extend that credit. 0:10:19.800 --> 0:10:20.640 So we so. 0:10:20.679 --> 0:10:24.479 Coming from you know, a platform that services retail advisors 0:10:24.480 --> 0:10:27.680 and clients for a long time. You know, we've we 0:10:27.800 --> 0:10:30.280 saw sort of just a stretching on the fixed income side. 0:10:30.280 --> 0:10:32.720 If you look at that standard sixty forty, taking that 0:10:32.800 --> 0:10:36.320 forty percent and really stretching what could be called, you know, 0:10:36.440 --> 0:10:40.480 a fixed income position, right, a traditional ballast position that 0:10:40.559 --> 0:10:44.720 portfolio by pushing into higher and higher you know, higher 0:10:44.760 --> 0:10:49.080 yielding you know, leverage loans even to an extent dividend 0:10:49.120 --> 0:10:51.520 payers because you were looking for some return on that. 0:10:51.800 --> 0:10:54.880 We're not in that environment anymore, And for the standard investor, 0:10:55.200 --> 0:10:58.160 I agree with the premise of your question that, yes, 0:10:58.520 --> 0:11:01.600 it's not the same take credit risk, but you don't 0:11:01.679 --> 0:11:04.520 have the need anymore that you did, you know, in 0:11:04.559 --> 0:11:07.960 a period of financial repression, to really move out on 0:11:08.000 --> 0:11:11.040 the credit risk to be putting in you know, perhaps 0:11:11.760 --> 0:11:15.040 you know, areas and fixed income on a different place 0:11:15.040 --> 0:11:18.280 in the capital structure, and areas that are you know, 0:11:18.440 --> 0:11:20.920 just just higher yielding but also bringing more risk to 0:11:20.960 --> 0:11:24.199 the portfolio when you already have that big equity stake. 0:11:24.679 --> 0:11:26.560 So you said you liked small caps, but you got 0:11:26.600 --> 0:11:30.960 to kind of stomach it. Why do you like small caps? Yeah? 0:11:30.960 --> 0:11:34.720 Look, I mean small caps, and if you excise. 0:11:34.400 --> 0:11:38.079 The growthiest you know, least profitable small caps, which are 0:11:38.120 --> 0:11:42.839 more like a lotto ticket type payoff structure, then you're 0:11:42.880 --> 0:11:46.199 living in a world where you know, they have outperformed 0:11:46.200 --> 0:11:49.959 over time. Small value in particular has tended to not 0:11:50.000 --> 0:11:53.560 only outperform, but also to outpace inflation. 0:11:54.080 --> 0:11:55.720 And so if you look at. 0:11:55.600 --> 0:11:58.000 The standard portfolio that most people are sitting in, they 0:11:58.000 --> 0:12:00.280 have a ton of the big growth just by virtue 0:12:00.360 --> 0:12:03.800 of the fact that if they're not index ers, you know, 0:12:03.880 --> 0:12:06.360 the active managers are not going to stray that far. 0:12:06.960 --> 0:12:09.120 They can't stray that far to take on that much 0:12:09.160 --> 0:12:09.719 tracking error. 0:12:09.800 --> 0:12:12.400 So small caps are a nice diversifyer that have paid 0:12:12.440 --> 0:12:15.199 off over time again if you take out those really 0:12:15.240 --> 0:12:18.040 low profitability stocks. And that's why we see a lot 0:12:18.040 --> 0:12:21.440 too around, you know, by quality small caps by the 0:12:21.520 --> 0:12:22.560 six hundred. 0:12:22.320 --> 0:12:24.720 Right, because you can you can get. 0:12:24.520 --> 0:12:29.360 That diversification benefit, that long run return potential, especially now 0:12:29.360 --> 0:12:32.160 that there's a cost of capital again, you know, and 0:12:32.200 --> 0:12:36.120 some of the fundamentals can be reasserting in these you know, 0:12:36.160 --> 0:12:38.599 style factors for example, in these portfolios. 0:12:39.600 --> 0:12:42.160 All Right, Dan, thanks a lot, super appreciated. Dana d'oria 0:12:42.440 --> 0:12:46.080 joining us CO chief investment officer over at in invest Net, 0:12:46.559 --> 0:12:50.160 joining us from Connecticut. It just feels like it's going 0:12:50.200 --> 0:12:52.920 to be really hard to change the narrative at this point. 0:12:53.080 --> 0:12:54.760 I mean, maybe in Vidia does something. 0:12:54.640 --> 0:12:57.000 But yeah, maybe in Vidia does something. Maybe we hear 0:12:57.000 --> 0:12:59.320 from the FED. That's you know, I don't know what 0:12:59.360 --> 0:13:01.120 we hear from the FED so often, But what could 0:13:01.120 --> 0:13:02.959 they say at the next meeting that would freak people out? 0:13:03.000 --> 0:13:05.120 I think the market they kind of conditioned the market 0:13:05.160 --> 0:13:06.560 to saying, Hey, we're going to hang here for a 0:13:06.559 --> 0:13:09.480 little bit, but on the margin, we're going to be 0:13:10.240 --> 0:13:13.920 cutting more likely than not at some point this year. 0:13:14.200 --> 0:13:16.959 I think that in of itself, the anticipation of a cut, 0:13:17.160 --> 0:13:19.560 to me is almost as good as the cut itself, totally. 0:13:19.600 --> 0:13:22.200 And that's what Mike McKee was saying to Rafael Bostik. 0:13:22.240 --> 0:13:24.160 He was like, I know you guys don't want to 0:13:24.200 --> 0:13:25.640 do four guidance, but aren't you kind of doing for 0:13:25.760 --> 0:13:28.400 a guidance by doing all that? Because the market front 0:13:28.440 --> 0:13:31.640 runs you and you obviously signed up that. But nonetheless. 0:13:32.840 --> 0:13:36.720 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:13:36.800 --> 0:13:39.520 weekdays at ten am Eastern on Apple car Playing and 0:13:39.640 --> 0:13:42.520 broud Otto with the Bloomberg Business app. Listen on demand 0:13:42.559 --> 0:13:46.880 wherever you get your podcasts, or watch us live on YouTube. 0:13:48.120 --> 0:13:50.480 All right, let's get to the news item over the weekend, 0:13:50.559 --> 0:13:52.559 and also take a look back at cut ours economic 0:13:52.600 --> 0:13:54.400 form because a lot of interesting things came out of 0:13:54.400 --> 0:13:59.120 that last week. Ronnie and President Ibrahim Ricey died yesterday 0:13:59.120 --> 0:14:02.400 in a helicopter with his foreign minister. That was the news. 0:14:02.440 --> 0:14:04.520 We want to go to Bobby Go. She's senior editor 0:14:04.840 --> 0:14:07.200 at Bloomberg News and he joins us through Zoom. He 0:14:07.240 --> 0:14:10.760 follows a lot of geopolitical issues along these lines with us. Bobby, 0:14:10.920 --> 0:14:14.400 Where does this leave Iran? What is the instability risk here? 0:14:16.120 --> 0:14:18.680 Well, this has never happened in Iran's recent history. No 0:14:18.760 --> 0:14:22.160 sitting president has ever died. So this is a fork 0:14:22.200 --> 0:14:24.000 in the road that Iran has never come to before. 0:14:24.040 --> 0:14:28.600 This regime likes to convey a sense of stability and continuity, 0:14:28.920 --> 0:14:32.200 but it has not been tested in this manner before. I, 0:14:32.360 --> 0:14:35.400 for one, don't expect a great deal of instability, because 0:14:35.480 --> 0:14:37.960 let's remind ourselves, the person who really pulls the strings 0:14:38.000 --> 0:14:40.800 in Iran is not the president. It is the supreme leader, 0:14:40.800 --> 0:14:43.760 who is unelected. Ali Khamine is his name. He sits 0:14:43.760 --> 0:14:47.640 above the entire government and in the frankly the entire administration, 0:14:47.920 --> 0:14:51.360 and he calls all the important shots. His policies are 0:14:51.400 --> 0:14:55.360 the ones that the president and others implement. He hasn't changed. 0:14:55.400 --> 0:14:59.160 He's old and ill and quite ill. He's eighty five 0:14:59.240 --> 0:15:03.240 years old, and so there are some concerns about succession there, 0:15:04.200 --> 0:15:07.120 and there was some thought that President Raisi would be 0:15:07.320 --> 0:15:10.520 the logical successor to the Supreme Leader. Now that's off 0:15:10.920 --> 0:15:15.560 the charts. But there's going to be an election in 0:15:15.920 --> 0:15:19.360 fifty days. Anytime there is an election, there is always 0:15:19.640 --> 0:15:23.360 an opportunity, however slim it might be, for other voices 0:15:23.400 --> 0:15:27.480 to be heard. The regime will try to maintain that 0:15:27.520 --> 0:15:31.520 continuity by making sure that in the new president, whoever 0:15:31.560 --> 0:15:35.840 he is, is also a hardliner, just like RAYSI. But 0:15:36.320 --> 0:15:38.720 you know, this is a black Swan event. And the 0:15:38.760 --> 0:15:41.960 thing about things about black Swan events now that you 0:15:42.120 --> 0:15:45.280 really can't be absolutely certain about what's going to happen next, 0:15:45.520 --> 0:15:47.280 precisely because it's never happened before. 0:15:47.800 --> 0:15:50.080 Bobby, is there any reason to believe the death of 0:15:50.600 --> 0:15:54.880 the reigning president will alter in any way around views 0:15:55.040 --> 0:15:57.600 or actions or policies as it relates to the broader 0:15:57.600 --> 0:16:00.680 Middle East? Here, I'm thinking Daza Israels happening today. 0:16:02.000 --> 0:16:04.560 I wouldn't be optimistic about that. Again, Kamene is the 0:16:04.600 --> 0:16:07.240 one whose policies are being implemented. He's not going to 0:16:07.320 --> 0:16:09.760 change his mind. He's an old school, died in the 0:16:09.800 --> 0:16:14.080 world hardliner. He hates as well, he hates America, and 0:16:14.320 --> 0:16:16.680 no matter who becomes president, they will basically have to 0:16:16.720 --> 0:16:19.640 do what Kamene says. The other joker in the pack 0:16:19.720 --> 0:16:22.520 is the IRGC, which is the military arm of the 0:16:22.560 --> 0:16:26.880 Iranian state. They're also very hardline and they will basically 0:16:26.960 --> 0:16:30.640 not tolerate a government that is softer towards the West. 0:16:31.000 --> 0:16:34.160 So I don't expect any significant change in foreign policy 0:16:34.680 --> 0:16:37.440 from the Iranians no matter who becomes president. 0:16:37.760 --> 0:16:41.600 You were also last week at Katar's Economic Forum, I 0:16:41.600 --> 0:16:45.200 mean huge lineup of guests. What were some of the 0:16:45.240 --> 0:16:47.560 takeaways that you had from that, like what should we 0:16:47.600 --> 0:16:48.280 be king in on? 0:16:49.720 --> 0:16:54.160 Well, interestingly and coincidentally, the number one theme, and this 0:16:54.200 --> 0:16:58.880 took me by surprise, was geopolitics and instability. I suppose 0:16:58.920 --> 0:17:01.040 I shouldn't have been surprised because of what's going on 0:17:01.120 --> 0:17:03.960 in the region, the war in Gaza. Now look at 0:17:03.960 --> 0:17:05.960 it from this distance, you might think, well, that's a 0:17:06.080 --> 0:17:09.359 very localized conflict that's just taking place in Gaza that 0:17:09.400 --> 0:17:11.199 does not involve the rest of the Middle East and 0:17:11.560 --> 0:17:13.720 the price of oil is stable, the governments in the 0:17:13.720 --> 0:17:16.000 Middle East are all more or less stable, and so 0:17:16.880 --> 0:17:19.520 they would be concerned. But actually there was a lot 0:17:19.560 --> 0:17:22.479 of concern. We heard from the Prime Minister of Qatar 0:17:22.600 --> 0:17:25.960 about his concerns about the fact that the ceasefire talks 0:17:26.000 --> 0:17:29.119 between hamas And and Israel are not going anywhere. We 0:17:29.200 --> 0:17:32.520 heard from the Prime minister from Malaysia. We heard from 0:17:32.880 --> 0:17:37.760 the President of Indonesia. We also heard about the geopolitical 0:17:38.119 --> 0:17:43.119 uncertainties that are sort of continuing from the Ukrainian the 0:17:43.119 --> 0:17:45.800 conflict in Ukraine with the Russia invade in Ukraine. We 0:17:45.840 --> 0:17:50.480 heard from the President of Poland who talked about that. 0:17:50.560 --> 0:17:54.800 So it was really quite My perception was that the sessions, look, 0:17:54.880 --> 0:17:57.320 it was a very well attended event, and all the 0:17:57.359 --> 0:17:59.400 sessions were very well attended, but the ones that seem 0:17:59.480 --> 0:18:03.960 to capture people's imaginations were around the idea that we 0:18:04.040 --> 0:18:09.920 are now going through a period of instability because of wars, 0:18:09.960 --> 0:18:13.920 hot wars between countries and the Cold War between the 0:18:14.000 --> 0:18:18.359 United States and China and everything else. Everybody's strategy, every 0:18:18.359 --> 0:18:20.880 company's way of thinking of the world, every government's way 0:18:20.920 --> 0:18:23.960 of thinking of the world has to be refracted through 0:18:24.000 --> 0:18:26.919 these lenses of conflict. That was quite striking to me. 0:18:27.240 --> 0:18:29.280 Bobby, here's my ignorant question of the day. It's just 0:18:29.280 --> 0:18:32.840 from a geography perspective, the Persian golf nations are attracting 0:18:33.560 --> 0:18:36.080 so much capital, and there's so much optimism about many 0:18:36.080 --> 0:18:39.760 of those that part of the world. There United Arab 0:18:39.760 --> 0:18:44.920 Emirates Qatar, for example, How I guess how closely are 0:18:44.960 --> 0:18:47.840 they kind of thought of from investors perspective with the 0:18:47.880 --> 0:18:51.000 Middle East, with what's gone on in Israel, Egypt and Gazan. 0:18:51.280 --> 0:18:53.360 I mean, are they considered two separate regions? So if 0:18:53.359 --> 0:18:57.320 I'm thinking about investing in you know, Cutter, for example, 0:18:57.359 --> 0:18:59.679 I'm not too concerned about the regional conflicts or am. 0:18:59.560 --> 0:19:02.879 I Well, you would think that, but a lot of 0:19:03.000 --> 0:19:06.879 international investors outside of the Middle East are not making 0:19:06.920 --> 0:19:10.560 that distinction, and they are that we've heard recently. For instance, 0:19:10.560 --> 0:19:13.800 Saudi Arabia, southi Arabia is a long way from the 0:19:14.200 --> 0:19:18.920 war zone. The Saudist have a robastic well, while gas 0:19:18.960 --> 0:19:22.000 prices are high, a pretty strong economy. They're sitting on 0:19:22.040 --> 0:19:26.000 a massive, massive war chest. They're building these gigantic projects, 0:19:26.040 --> 0:19:28.480 a whole new city in the desert and they're open 0:19:28.520 --> 0:19:30.520 for business. They want foreign investors to come, and you 0:19:30.640 --> 0:19:32.760 think foreign investors would want to get in on the 0:19:32.760 --> 0:19:35.720 ground floor in a lot of those projects not happening. 0:19:36.119 --> 0:19:40.320 Not happening the South as RBN Business Business Bloomberg News 0:19:40.320 --> 0:19:43.520 colleagues have reported they're really struggling to get foreign investors. 0:19:43.800 --> 0:19:46.440 And some of that is to do with the larger 0:19:46.680 --> 0:19:50.000 geopolitical instability in the region. Some of it is specifically 0:19:50.320 --> 0:19:52.000 to do with events in Saudi Arabia. 0:19:52.960 --> 0:19:55.960 When we take a look at you politics, how we're 0:19:56.080 --> 0:19:58.440 very obviously US centric because we're in the middle of 0:19:58.520 --> 0:20:01.520 New York right, How interested is the rest of the 0:20:01.560 --> 0:20:04.080 world in the twenty twenty four presidential election? Like, how 0:20:04.080 --> 0:20:06.600 did the Biden Trump scenario play out? And cut there? 0:20:07.720 --> 0:20:11.679 Oh yeah, every conversation I had, bar every conversation with 0:20:11.840 --> 0:20:14.479 every delegate, all wanted to know, you from New York, 0:20:14.520 --> 0:20:16.159 what's going on with the election? Is Biden really going 0:20:16.200 --> 0:20:19.560 to win? Is Trump really going to win? There was 0:20:19.600 --> 0:20:22.479 some attempt to you know, we heard from Ken Griffin, 0:20:22.520 --> 0:20:26.160 for instance, on the stage, who said that who gave 0:20:26.160 --> 0:20:28.560 the impression that it wouldn't really matter. He seems to 0:20:28.600 --> 0:20:32.399 favor a Trump presidency, a return of Trump. But there 0:20:32.440 --> 0:20:35.159 were some attempts on from stage from various speakers to say, oh, 0:20:35.200 --> 0:20:37.280 you know, the US economy is robust and it doesn't matter. 0:20:37.600 --> 0:20:39.679 That is not how it was reflected. In my private 0:20:39.680 --> 0:20:43.399 conversations with people off the stage. A lot of it 0:20:43.520 --> 0:20:45.960 was really really deep concerned, you know, the things that 0:20:45.960 --> 0:20:49.400 they are seeing from that distance taking place in America unprecedented, 0:20:49.400 --> 0:20:54.159 an American former president in court for every day, with 0:20:54.240 --> 0:20:57.159 the possibility of going to jail. There's a lot of 0:20:57.160 --> 0:20:59.600 concern about that. Would that lead to instability, would that 0:20:59.680 --> 0:21:03.480 lead to something a repetition of the storming of Congress. 0:21:04.040 --> 0:21:06.879 There's concern about the age of the candidates, even in 0:21:06.960 --> 0:21:09.119 a part of the world where leaders tend to be 0:21:09.200 --> 0:21:13.920 quite old. So that was the backdrop against which all 0:21:13.960 --> 0:21:15.040