WEBVTT - ICC Issues Arrest Warrant for Netanyahu, Nvidia Earnings 0:00:02.400 --> 0:00:09.119 Bloomberg Audio Studios, podcasts, radio news. You're listening to the 0:00:09.119 --> 0:00:13.320 Bloomberg Intelligence Podcast. Catch us live weekdays at ten am 0:00:13.320 --> 0:00:15.800 Eastern on Apple car Playing and broud Otto with the 0:00:15.800 --> 0:00:19.720 Bloomberg Business app. Listen on demand wherever you get your podcasts, 0:00:19.920 --> 0:00:22.280 or watch us live on YouTube. 0:00:23.360 --> 0:00:26.400 One of the most red topics are stories on the 0:00:26.400 --> 0:00:29.760 Bloomberg terminal today has to do with Israel. The International 0:00:29.800 --> 0:00:33.040 Criminal Court issued an in rest warrant for Israeli Prime 0:00:33.080 --> 0:00:37.199 Minister Benjamin Netnyahu for alleged war crimes. Thatt's break that 0:00:37.240 --> 0:00:39.839 down with Dan Williams. He's a reporter for Bloomberg News. 0:00:39.880 --> 0:00:41.479 He is based in Jerusalem. 0:00:41.600 --> 0:00:44.279 Dan, give us his story here. What does this really mean? 0:00:44.280 --> 0:00:46.360 Because the headline kind of jumps out of you here. 0:00:47.520 --> 0:00:50.680 It is a dramatic development. We've now seen some thirteen 0:00:50.680 --> 0:00:54.440 and a half months of open warfare between Israel, Hamas 0:00:54.440 --> 0:00:57.480 and Israel and Hasbela and Lebanon and other Iranian backparties 0:00:57.520 --> 0:01:00.400 in the region that has now evolved into open law 0:01:00.520 --> 0:01:05.480 fare with this very important court issuing arrest warrants against 0:01:05.480 --> 0:01:07.800 the is Raeti Prime Minister benjaminter Now and the former 0:01:07.800 --> 0:01:10.840 Defense Minister Joaf Gallant. Those are arrest warrants that are 0:01:10.840 --> 0:01:14.240 actually binding on more than one hundred and twenty countries 0:01:14.280 --> 0:01:19.880 that are signatories to the treaty that underpins that court's conduct. 0:01:20.240 --> 0:01:22.959 Israel is not a signatory, neither is the United States. 0:01:23.400 --> 0:01:27.800 Israel had sought, however, to contest this request for the 0:01:28.240 --> 0:01:31.440 arrest warrants. That failed, as we discovered today, with the 0:01:31.480 --> 0:01:34.600 court saying it had rejected these raady motions and upheld 0:01:34.640 --> 0:01:38.400 and actually decided to issue those arrest warrants as sought 0:01:38.440 --> 0:01:39.760 by the Special Prosecutor. 0:01:41.000 --> 0:01:44.360 Has a United States made any statement on this matter, 0:01:44.440 --> 0:01:48.280 because the support for Israel a generally quite strong in 0:01:48.320 --> 0:01:49.240 the United States. 0:01:50.080 --> 0:01:52.880 Indeed, and throughout these proceedings, we're talking about several months 0:01:52.920 --> 0:01:56.280 of anticipation. I believe the Special Prosecutor formally filed his 0:01:56.400 --> 0:01:59.680 request for arrest warrants back in late May. The Biden 0:01:59.680 --> 0:02:03.840 minister stration said openly that it thought this was baseless. 0:02:04.640 --> 0:02:08.400 Israel has obviously been far more vociferous, calling this antisemitic, 0:02:08.840 --> 0:02:12.919 likening it to the infamous Dreyfus trial. I think both 0:02:12.960 --> 0:02:16.000 countries will be looking to what the next US administration, 0:02:16.400 --> 0:02:19.560 the Trump administration, will do, and significant parties in that 0:02:19.600 --> 0:02:22.799 administration are already saying that when the time comes, they 0:02:22.800 --> 0:02:25.480 will double down on their support for Israel. The question 0:02:25.680 --> 0:02:27.520 is what does that mean. Are they going to try 0:02:27.560 --> 0:02:31.120 to convince like minded countries in Western Europe to withdraw 0:02:31.160 --> 0:02:33.440 from the court or on an individual level, to state 0:02:33.440 --> 0:02:35.639 that they will not abide they will not honor these 0:02:35.760 --> 0:02:38.960 arrest warrants. As I said, it's dramatic development, and I 0:02:39.000 --> 0:02:42.480 think these Raelis will be strategizing very very intensely. Right now. 0:02:43.240 --> 0:02:48.000 Do we why historically have has Israel and the United 0:02:48.040 --> 0:02:50.040 States not been a party to this court? 0:02:51.600 --> 0:02:53.920 I think it comes down to a fear for their autonomy. 0:02:53.919 --> 0:02:56.680 Also the fact that, certainly since the War on Terror, 0:02:56.880 --> 0:03:01.000 the United States has been waging a time quite unilateral 0:03:01.120 --> 0:03:04.200 national security policies abroad, wars that did not always have 0:03:04.280 --> 0:03:07.959 international support. I think the argument is that this would 0:03:08.040 --> 0:03:13.560 effectively intrude on self determination, self defense, the sovereign rights 0:03:13.560 --> 0:03:16.960 of a country. And also they would argue that this 0:03:17.120 --> 0:03:20.360 court is designed to bring justice to countries where there's 0:03:20.400 --> 0:03:25.400 no working inside internal organic justice system. Now Israel says 0:03:25.600 --> 0:03:28.800 it's justicism works perfectly fine. It's had the support of 0:03:28.800 --> 0:03:31.240 some Western countries for that, but it seems that the 0:03:31.480 --> 0:03:34.360 ICC has decided not to find in favor of that 0:03:34.400 --> 0:03:37.200 point of view this time. So in effect, Israel or 0:03:37.200 --> 0:03:40.400 at least these two leaders will be treated like pariahs 0:03:40.400 --> 0:03:43.240 in many of the countries that are required to abide 0:03:43.240 --> 0:03:46.080 by it. It's a development that I think NETANIAO will 0:03:46.080 --> 0:03:47.240 find very very unwelcome. 0:03:47.760 --> 0:03:50.840 I can imagine, Dan, where is just to educate us? 0:03:50.880 --> 0:03:52.480 Where is the International Criminal Court? 0:03:52.520 --> 0:03:53.400 Where is it based? 0:03:53.760 --> 0:03:56.560 And are there are certain countries that have particular influence 0:03:56.640 --> 0:03:57.240 on this court? 0:03:58.880 --> 0:04:01.320 It's at Behague in the Netherlands. That's also where the 0:04:01.360 --> 0:04:04.320 International Court of Justices. That's a court with slightly different 0:04:04.320 --> 0:04:08.920 mandate and different jurisdiction. And again it's an extension of 0:04:09.440 --> 0:04:12.640 various treaties and conventions that arose, especially off to World 0:04:12.680 --> 0:04:16.440 War Two. The bulk of the world's countries are signatories. 0:04:16.680 --> 0:04:19.120 It means they have standing to argue, to submit. It 0:04:19.160 --> 0:04:23.279 also requires them to enflse when warrants, when decisions such 0:04:23.279 --> 0:04:23.960 as has come down. 0:04:24.240 --> 0:04:26.000 All right, Dan, thank you so much for your reporting. 0:04:26.040 --> 0:04:28.520 We really appreciate that. Dan Williams, he's a reporter for 0:04:28.520 --> 0:04:32.000 Bloomberg News. He's based in Jerusalem. Again on the geopolitical front, 0:04:32.040 --> 0:04:36.040 just another major development, the International Criminal Court issues and 0:04:36.200 --> 0:04:39.320 arrest warrant for Israeli Prime Minister of Benjamin at Yaou 0:04:39.440 --> 0:04:42.640 for alleged war crimes, and we appreciate getting that on 0:04:42.800 --> 0:04:44.520 the ground reporting from Israeli. 0:04:46.000 --> 0:04:49.880 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:04:49.960 --> 0:04:53.480 weekdays at ten am Eastern on applecard Play and Android 0:04:53.520 --> 0:04:56.279 Otto with the Bloomberg Business app. You can also listen 0:04:56.400 --> 0:04:59.480 live on Amazon Alexa from our flagship New York station 0:05:00.320 --> 0:05:02.599 Alexa playing Bloomberg eleven thirty. 0:05:03.640 --> 0:05:07.240 All right, offspring number four bought in video. 0:05:08.920 --> 0:05:10.920 He's down on his trade and he bought it from 0:05:10.920 --> 0:05:13.080 his brother who works in the financial services industry. 0:05:13.120 --> 0:05:13.760 So we were on a. 0:05:13.720 --> 0:05:17.920 Conference call yesterday heated talking about breaking down the quarter 0:05:18.040 --> 0:05:18.640 for in video. 0:05:18.720 --> 0:05:19.839 I thought the numbers were good. 0:05:19.880 --> 0:05:22.640 Let's talk to an expert man deep seeing senior technology 0:05:22.680 --> 0:05:24.080 analys from Bloomberg Intelligence. 0:05:24.640 --> 0:05:25.640 Mandy, what you think of it? 0:05:25.920 --> 0:05:27.480 The numbers came in, you know, a little bit better 0:05:27.520 --> 0:05:30.040 and expected guidance pretty solid, but again the whisper was 0:05:30.080 --> 0:05:31.120 probably a little bit higher. 0:05:31.160 --> 0:05:33.839 So yeah, and look, when you have a price for perfection, 0:05:34.200 --> 0:05:39.400 that Invidia is always you know, any slight miss in 0:05:39.480 --> 0:05:42.360 the networking side, which was the case here, or even 0:05:42.440 --> 0:05:46.720 a gross margin degradation, which they said we'll go up 0:05:46.760 --> 0:05:49.159 in the second half of next year. So it's really 0:05:49.200 --> 0:05:52.239 a transitory thing. We'll have an impact on the stock, 0:05:52.360 --> 0:05:57.039 and I think overall the demand side looks pretty solid. 0:05:57.480 --> 0:06:01.039 They said, they've Jensen called out there will be no 0:06:01.200 --> 0:06:06.080 Capex digestion until the data center spending hits a trillion dollars. 0:06:06.400 --> 0:06:07.000 That's huge. 0:06:07.000 --> 0:06:09.560 I mean, just think about you know how much runway 0:06:09.600 --> 0:06:13.560 he thinks without a pause. Now does the market believe it? 0:06:13.640 --> 0:06:17.800 Probably not, given what we heard at our conference yesterday 0:06:18.000 --> 0:06:21.240 is it's moving from training to inferencing, and on the 0:06:21.360 --> 0:06:25.960 inferencing side there is probably more. So if once you 0:06:26.040 --> 0:06:29.960 have a train model, you're deploying that model in co 0:06:30.160 --> 0:06:34.240 pilots or chat pots and it's basically a train model 0:06:34.279 --> 0:06:38.960 that's being used for answering queries and that's inferencing answering 0:06:39.040 --> 0:06:43.119 queries or you know, providing some productivity benefit. And that's 0:06:43.160 --> 0:06:46.159 where do you really need a high end in video chip? 0:06:46.800 --> 0:06:50.760 The answer is divided. Some people say for the older 0:06:50.839 --> 0:06:53.840 versions of in video chips, you could use that for inferencing, 0:06:53.880 --> 0:06:56.279 the latest one will continue to get used for training. 0:06:56.640 --> 0:06:59.919 And that's a plausible answer. But as we have learned, 0:07:00.279 --> 0:07:03.520 there is growing competition on the inferencing side from the 0:07:03.680 --> 0:07:07.039 likes of AMD, as well as startups like sam Bnova, 0:07:07.200 --> 0:07:10.440 Cerebras and all these companies are trying to get some 0:07:10.560 --> 0:07:11.480 portion of that pie. 0:07:11.800 --> 0:07:14.560 And folks, Ben Deep was referencing a conference he hosted 0:07:14.640 --> 0:07:18.800 yesterday and annaag Rana are other technology channels to Bloomberg Intelligence. 0:07:18.840 --> 0:07:21.320 It was a phenomenal conference. I mean, they had some 0:07:22.000 --> 0:07:25.160 just amazing speakers there. And the next time you get 0:07:25.200 --> 0:07:26.720 something in near your mail saying hey, come to a 0:07:26.720 --> 0:07:29.360 BI sponsored conference, get off your ear end and get 0:07:29.440 --> 0:07:32.840 to these conferences because some seriously smart people get together 0:07:32.880 --> 0:07:34.680 and you learn a lot. I did hosting a couple 0:07:34.760 --> 0:07:35.640 panels yesterday. 0:07:36.040 --> 0:07:36.840 Men Deep, So. 0:07:38.400 --> 0:07:41.280 When you listen to this the management team in Nvidia, 0:07:41.840 --> 0:07:44.120 where do they say, I mean, can they look a year, 0:07:44.320 --> 0:07:46.560 two years in advance, how do they think their business 0:07:46.600 --> 0:07:47.360 is going to develop? 0:07:47.680 --> 0:07:47.880 Yeah? 0:07:47.920 --> 0:07:50.960 I mean look the fact that they're saying growth margins 0:07:51.040 --> 0:07:53.800 will go down to around seventy one percent over the 0:07:53.840 --> 0:07:58.240 next two quarters, but readbound seventy one seventy one real smart, Yes, wow, 0:07:58.560 --> 0:08:01.880 and it's it's again terrific when you look at it 0:08:02.080 --> 0:08:06.920 from every angle. Is just the way expectations were priced 0:08:06.960 --> 0:08:09.800 for it's mid seventy percent. So the fact that they 0:08:09.800 --> 0:08:13.480 are going down to seventy one percent, but in Jensen's 0:08:14.080 --> 0:08:18.560 you know case, he called out those margins going back 0:08:18.560 --> 0:08:20.960 to seventy five percent. So it's really a ramp up 0:08:21.000 --> 0:08:25.200 of their new architecture Blackwell, which is causing the transitory 0:08:25.240 --> 0:08:29.240 gross margin degradation. But once they get that in full production, 0:08:29.640 --> 0:08:32.560 he expects gross margins to go back to seventy five percent. 0:08:32.880 --> 0:08:35.640 Now I do think again there will be more competition, 0:08:35.760 --> 0:08:38.280 but he clearly doesn't believe that to be the case. 0:08:38.280 --> 0:08:40.240 All Right, I mean, here are just some crazy numbers 0:08:40.240 --> 0:08:43.839 of folks. Just total revenue. Let's let's got really simple here. 0:08:43.960 --> 0:08:49.480 Revenue roughly calendar year twenty two, twenty seven billion of revenue. 0:08:49.640 --> 0:08:53.079 Calendar you're twenty four one hundred and twenty eight billion 0:08:53.160 --> 0:08:56.520 of revenue. Have you seen anything like this in technology? 0:08:57.080 --> 0:08:59.400 I mean, the closest thing that comes to mind is 0:08:59.440 --> 0:09:03.200 the buildout out of the Internet infrastructure back in nineteen 0:09:03.280 --> 0:09:06.920 ninety nine. I think Cisco had a similar ramp up 0:09:06.960 --> 0:09:11.520 on the networking side. But what's different is Innvidia clearly 0:09:11.880 --> 0:09:15.679 has the balance sheet as well as they are in 0:09:15.840 --> 0:09:20.400 more products than Cisco was. So Cisco was just providing 0:09:20.400 --> 0:09:24.120 the networking gear. Nvidia has a software line, they have 0:09:24.240 --> 0:09:27.440 a networking business and then their coreship business. So clearly 0:09:27.800 --> 0:09:29.560 Nvidia is going with the. 0:09:29.600 --> 0:09:33.160 Platform of a stupid income statement. They have fifty five 0:09:33.240 --> 0:09:37.640 percent net income margins, so and they have no capex 0:09:37.679 --> 0:09:40.360 to speak of two three four point so the free 0:09:40.400 --> 0:09:44.160 cash flow is just freakish. So what do they do 0:09:44.240 --> 0:09:45.240 with the cash? 0:09:45.480 --> 0:09:49.359 Well, right now they're doing some share buybacks, but acquisitions 0:09:49.400 --> 0:09:52.640 maybe on the table if the incoming Trump administration loses 0:09:52.720 --> 0:09:53.320 the regulation. 0:09:53.520 --> 0:09:55.760 So okay, let's go down that road there. 0:09:55.760 --> 0:09:59.839 What's the feeling in Silicon Valley in technology about that opportunity, Because, boy, 0:10:00.320 --> 0:10:02.480 your industry and particularly some of the bigger companies that 0:10:02.480 --> 0:10:04.560 you cover, the Amazons of the world, the Google's the world, 0:10:04.800 --> 0:10:08.120 they can't do anything these days. Is the expectation that 0:10:08.240 --> 0:10:08.960 might loosen up. 0:10:09.800 --> 0:10:13.319 Well, the overall m andy environment an ip environment may 0:10:13.360 --> 0:10:16.640 get better, but in terms of big tech, I doubt 0:10:16.720 --> 0:10:20.120 it's anything is changing on that front. Especially for the 0:10:20.320 --> 0:10:24.520 likes of Alphabet and Meta. Probably an Apple or an 0:10:24.640 --> 0:10:28.080 Nvidia may be able to do more acquisitions, but I 0:10:28.120 --> 0:10:31.320 think the companies that are in the crosshairs of you 0:10:31.400 --> 0:10:36.120 know what the incoming administration feels on the consumer side, 0:10:36.320 --> 0:10:39.360 I doubt they'll allow them to make any fur their acquisition. 0:10:39.480 --> 0:10:41.400 All right, man, thanks so much for coming in here, 0:10:41.400 --> 0:10:45.079 Man deep seeing senior technology analyst Bloomberg Intelligence through and 0:10:45.160 --> 0:10:48.560 a rag Randa through a great technology conference yesterday packed 0:10:48.559 --> 0:10:51.280 full of some really smart investors. Again, folks, the next 0:10:51.280 --> 0:10:54.160 time you get an invite in your Bloomberg inbox, jump 0:10:54.240 --> 0:10:57.600 on it because BI is sponsoring some really good investor conferences. 0:10:59.000 --> 0:11:02.840 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:11:02.920 --> 0:11:06.280 weekdays at ten am Eastern on Focar, playing Android OUTO 0:11:06.360 --> 0:11:09.320 with the Bloomberg Business app. Listen on demand wherever you 0:11:09.360 --> 0:11:13.040 get your podcasts, or watch us live on YouTube. 0:11:13.640 --> 0:11:15.480 Let's get back to these markets again. We've kind of 0:11:15.480 --> 0:11:17.600 got red and green on the screen. The Nasdaq's off 0:11:17.640 --> 0:11:20.760 about one percent, but the SMP and NADAL are up slightly. 0:11:21.240 --> 0:11:22.880 Let's get a sense of where we go here as 0:11:22.880 --> 0:11:26.040 we wrap up this earning season. Maryon Bartel's chief investment 0:11:26.080 --> 0:11:30.320 strategist at Sanctuary Wealth. Here, Mariann, thanks so much for 0:11:30.520 --> 0:11:33.560 joining us here. Love to just step back, you know, 0:11:33.640 --> 0:11:36.959 maybe get a thirty thousand foot view from you on 0:11:37.160 --> 0:11:39.400 these markets. What are you talking to your clients about 0:11:39.440 --> 0:11:41.640 here today, because boy, a lot has changed in the 0:11:41.679 --> 0:11:45.400 last couple of weeks with elections and geopolitics and earnings 0:11:45.440 --> 0:11:46.880 and a lot of moving parts out there. 0:11:47.960 --> 0:11:51.360 Well, we just released our twenty twenty five year ahead 0:11:51.960 --> 0:11:55.480 forecast and the name of it, or the title of 0:11:55.520 --> 0:11:59.760 it is all that's new, that's old. Yes, we have AI, 0:12:00.080 --> 0:12:05.200 we have blockchain augmented technology, and we believe that this 0:12:05.360 --> 0:12:08.960 is really altering not just the US economy but the 0:12:09.000 --> 0:12:13.440 global economies. And we've likened this to similar periods from 0:12:13.520 --> 0:12:17.280 nineteen ninety five to two thousand, but also from twenty 0:12:17.280 --> 0:12:21.400 five to twenty nine, where we also had new technologies, 0:12:21.440 --> 0:12:25.000 although they don't feel like new technologies. You know, the automobile, 0:12:25.760 --> 0:12:31.120 the railroads, and markets did phenomenally well because economies grew. 0:12:31.679 --> 0:12:35.800 So we believe we're in this extraordinary, you know, growth 0:12:35.880 --> 0:12:41.320 cycle being led by right now in Vidia, which we 0:12:41.480 --> 0:12:46.520 talked about. They're really altering the next generation of technology. 0:12:47.040 --> 0:12:49.720 So we have our forecast for the SMP for next 0:12:49.760 --> 0:12:52.400 year at seventy two hundred to seventy four hundred. 0:12:52.600 --> 0:12:53.319 Wow and yees. 0:12:53.480 --> 0:12:56.760 That means another twenty percent. But when we went back 0:12:56.840 --> 0:13:00.560 and analyzed the nineties, from ninety five to two thousand, 0:13:01.000 --> 0:13:04.400 we had markets up twenty percent or higher five years 0:13:04.400 --> 0:13:06.960 in a row. Now, in ninety seven and ninety eight 0:13:07.040 --> 0:13:09.760 we had bear market corrections within the year because we 0:13:09.800 --> 0:13:12.120 had a tie back crisis, We had a rush of 0:13:12.200 --> 0:13:14.160 default in the long term capital, a little bit of 0:13:14.160 --> 0:13:18.600 a financial crisis, but those markets still rallied strongly by 0:13:18.640 --> 0:13:20.080 the end of the year, and we think we're in 0:13:20.120 --> 0:13:21.480 a very similar position. 0:13:22.600 --> 0:13:24.400 Talk to us about earnings. What did you take away 0:13:24.400 --> 0:13:26.319 from this earning cycle. We're just wrapping up with some 0:13:27.000 --> 0:13:31.040 retailers this week. What is your view of earnings out 0:13:31.120 --> 0:13:33.880 there again? To get to that, you know, any kind 0:13:33.880 --> 0:13:35.800 of S ANDP handle with a seven in front of it, 0:13:35.880 --> 0:13:38.440 you have to be pretty bullish, I would think on earnings. 0:13:38.679 --> 0:13:39.000 I am. 0:13:39.559 --> 0:13:42.760 I think there's a lot to do with earnings. Markets 0:13:42.800 --> 0:13:46.240 really need earnings to grow, and we see the economy 0:13:46.280 --> 0:13:49.160 growing next year, especially since we've already had a seventy 0:13:49.440 --> 0:13:52.160 five basis point cut by the Fed. Now they may 0:13:52.200 --> 0:13:54.800 slow the pace, but they're more in an easing cycle, 0:13:55.120 --> 0:13:57.640 which we think is going to be very bullish considering 0:13:57.720 --> 0:14:00.960 the economy is growing around three percent and we're at 0:14:00.960 --> 0:14:05.439 full employment. The consumer has money to spend. Household network 0:14:05.559 --> 0:14:09.040 is at a record high. When we look at disposable income, 0:14:09.960 --> 0:14:13.560 there's enough disposable income for the consumer to spend, and 0:14:13.640 --> 0:14:16.360 as you know in your viewers know, the consumer really 0:14:16.440 --> 0:14:19.840 is the main driver of our economy. So we do 0:14:20.040 --> 0:14:23.200 think the cycle is being led by technology. This year 0:14:23.240 --> 0:14:26.760 it's been really all about Semis. We think that narrative 0:14:26.800 --> 0:14:29.160 is shifting a little bit more now to software. Not 0:14:29.280 --> 0:14:32.040 that we're negative on semis, but we think the pace 0:14:32.080 --> 0:14:35.000 of their ascent can slow down, and now we see 0:14:35.040 --> 0:14:38.680 a cycle of software growing as we go into twenty 0:14:38.720 --> 0:14:42.920 twenty five. Another positive for earnings is the steeple yield 0:14:42.920 --> 0:14:46.360 curve for banks, and we also like the capital markets. 0:14:46.440 --> 0:14:50.520 Those are important ingredients to keep an economy going. I 0:14:50.520 --> 0:14:53.479 always say the banks are the heartbeat of the economy 0:14:53.840 --> 0:14:56.680 and the private markets, the private credit markets are flesh 0:14:57.000 --> 0:15:01.320 with liquidity to provide to companies. So we're very optimistic 0:15:01.360 --> 0:15:04.680 and we see also profit margins growing, so we think 0:15:04.720 --> 0:15:07.000 we're really in that goldilocks environment. 0:15:07.800 --> 0:15:09.800 Well, I think I may be calling the top in 0:15:09.840 --> 0:15:12.080 the tech market because my youngest offspring just bought some 0:15:12.240 --> 0:15:14.280 invidious and that's got to be the top. So if 0:15:14.280 --> 0:15:17.400 I wanted to diversify Marianna and try to find some 0:15:17.600 --> 0:15:21.040 value out there, where do I go? 0:15:22.360 --> 0:15:24.480 So we think the best if you're looking for value, 0:15:24.520 --> 0:15:26.800 we do think the best value is in the financials, 0:15:27.120 --> 0:15:30.840 particularly in the banks and also the capital markets. You know, 0:15:31.080 --> 0:15:34.880 energy is good value, but we don't really see crude 0:15:34.880 --> 0:15:37.600 oil firming up. We think crew going into twenty twenty 0:15:37.640 --> 0:15:41.920 five is going to be either range or too slightly down. 0:15:42.080 --> 0:15:46.960 Especially with the Trump administration, there's concern that we'll add 0:15:47.000 --> 0:15:49.320 to supply, and if you add to supply in a 0:15:49.360 --> 0:15:53.120 weaker demand environment which we're in, particularly because of China, 0:15:54.200 --> 0:15:56.600 we think that, you know, energy is really not the 0:15:56.640 --> 0:16:00.400 place to be for twenty twenty five, at least for value. 0:16:00.440 --> 0:16:03.360 So the values really I think best in financials. Which 0:16:03.440 --> 0:16:06.920 really shocking is you know, healthcare and staples, which are 0:16:06.960 --> 0:16:09.960 really called your defensive part of your market, are really 0:16:10.040 --> 0:16:13.880 falling off a cliff in terms of relative performance, we 0:16:13.960 --> 0:16:17.440 really don't even see any value in there. So best 0:16:17.440 --> 0:16:19.080 place for value would be the financials. 0:16:20.600 --> 0:16:23.200 Marian, how about outside the US do you guys allocate 0:16:23.240 --> 0:16:24.960 any many outside of the US markets? 0:16:26.320 --> 0:16:30.080 You know, in terms of asset allocation when you look 0:16:30.080 --> 0:16:33.680 at asset allocation models over a very long term period, 0:16:34.520 --> 0:16:38.480 diversifying internationally does work. But our thesis going into twenty 0:16:38.520 --> 0:16:41.640 twenty five, if we are correct that we're in this 0:16:41.720 --> 0:16:46.360 new technological advance, most of the technologies being developed here 0:16:46.360 --> 0:16:49.400 in the United States, and that means you have to 0:16:49.440 --> 0:16:52.120 own the companies here in the United States. So we 0:16:52.160 --> 0:16:55.640 see capital flows continuing to come to the United States. 0:16:56.200 --> 0:16:59.600 So although markets we think can go up outside of 0:16:59.600 --> 0:17:02.400 the United States, we think the leader of the pack 0:17:02.560 --> 0:17:04.879 will remain in the United States. Now it may be 0:17:05.080 --> 0:17:09.199 choppy back and forth, you know, up down, updown, but 0:17:09.320 --> 0:17:10.879 by the end of the year, we still think the 0:17:11.000 --> 0:17:13.040 US will do well. And then you have to consider 0:17:13.080 --> 0:17:16.840 the US dollar, and we see the US dollar as 0:17:16.920 --> 0:17:20.639 either being stable too strong. So when you invest overseas, 0:17:20.680 --> 0:17:23.320 if the dollar strengthens, you lose part of your return. 0:17:23.840 --> 0:17:26.159 So for you know, twenty twenty five, we have an 0:17:26.200 --> 0:17:27.159 overweight to the US. 0:17:27.560 --> 0:17:29.480 All right, Mary, and thank you so much. We appreciate that. 0:17:29.520 --> 0:17:33.160 Marion Bartel's she's a chief investment strategist for Sanctuary Wealth. 0:17:33.240 --> 0:17:36.200 Joining us from New York via some zoom. 0:17:36.200 --> 0:17:41.479 Here, you're listening to the Bloomberg Intelligence Podcast. Catch us 0:17:41.560 --> 0:17:44.920 live weekdays at ten am Eastern on applecar Play and 0:17:44.920 --> 0:17:47.879 Android Auto with the Bloomberg Business App. You can also 0:17:47.920 --> 0:17:51.440 listen live on Amazon Alexa from our flagship New York station, 0:17:51.800 --> 0:17:55.720 just say Alexa playing Bloomberg eleven thirty. 0:17:55.960 --> 0:17:56.960 All right, Alexe on Pauls. 0:17:57.000 --> 0:17:59.040 When you're live here in our Bloomberg Interactive Broker studio 0:17:59.160 --> 0:18:01.000 or streaming live on YouTube as well as to check 0:18:01.080 --> 0:18:03.560 us out of Bloomberg, go over to YouTube dot com 0:18:03.600 --> 0:18:06.119 and search Bloomberg Podcast. All right, Bitcoin, I'm calling it 0:18:06.160 --> 0:18:07.960 out for Tom Keen. I'm calling out from Matt Miller. 0:18:08.400 --> 0:18:10.840 Up one point eight percent ninety six thousand, two hundred. 0:18:10.880 --> 0:18:13.080 I mean, we are right on that one hundred thousand 0:18:13.160 --> 0:18:15.960 dollars level. Let's break down what's happening. Let's see what 0:18:16.080 --> 0:18:18.280 could be behind some of this stuff. Michael Reagan, he's 0:18:18.320 --> 0:18:21.480 a crypto team leader. Yes, we have a team of 0:18:21.560 --> 0:18:24.720 reporters covering crypto at Bloomberg, which means you need a 0:18:24.760 --> 0:18:26.960 team leader to manage these folks, and that's Michael Reagan. 0:18:27.119 --> 0:18:28.520 He drew the short stroll. He joins us here on 0:18:28.520 --> 0:18:32.399 at Bloomberg Interactive Broker Studio. At the election, I'm just 0:18:32.440 --> 0:18:35.320 gonna swag it here, it was about sixty thousand. Here 0:18:35.320 --> 0:18:37.280 we are pushing up against one hundred thousand. 0:18:37.720 --> 0:18:39.080 What accounts for that delta? 0:18:39.200 --> 0:18:41.960 Yeah, you know the expression I keep hearing over and 0:18:42.000 --> 0:18:45.399 over again, Paul's paradigm shift. You know, we went from 0:18:45.600 --> 0:18:49.480 sort of the near death of the entire industry with 0:18:49.640 --> 0:18:52.320 FTX and all the dominoes that fell after it a 0:18:52.400 --> 0:18:56.960 few years ago. Biden followed up the administration. Biden administration 0:18:57.000 --> 0:18:59.440 followed up with a really fierce crackdown on the industry. 0:18:59.560 --> 0:19:01.720 Now what Trump. 0:19:01.359 --> 0:19:04.000 Has signaled as a complete one eighty, you know, instead 0:19:04.040 --> 0:19:08.240 of this you know, highly regulated, very intense scrutiny on 0:19:08.280 --> 0:19:12.120 the industry, he's talking about, you know, replacing Gary Gensler 0:19:12.200 --> 0:19:16.120 with a crypto lover and just you know, really being 0:19:16.280 --> 0:19:20.440 friendly to the to the broader industry of digital assets. 0:19:20.480 --> 0:19:25.159 But the real for bitcoin specifically, it's this promise that 0:19:25.160 --> 0:19:27.960 Trump made in July at a bitcoin conference to create 0:19:28.280 --> 0:19:31.439 what he called a strategic bitcoin stockpile. So, you know, 0:19:31.480 --> 0:19:35.040 think of the strategic petroleum reserve. You know, we've had 0:19:35.040 --> 0:19:37.080 strategic wheat reserves in the past. 0:19:37.560 --> 0:19:37.720 You know. 0:19:37.800 --> 0:19:42.440 The thinking of him and Synthonia Loomis, his ally and 0:19:42.480 --> 0:19:46.639 the Senate, the senator from Wyoming, is that if you 0:19:46.720 --> 0:19:49.359 not only Trump. First of all, the government owns about 0:19:49.359 --> 0:19:55.000 two hundred and change bitcoin from various criminal ASCID forfeitures. 0:19:55.119 --> 0:19:55.879 That's why I know that. 0:19:55.920 --> 0:19:58.120 Okay, So that's sort of the what Trump has hinted 0:19:58.160 --> 0:20:02.160 would be the basis for this reserve. Senator Loomis wants 0:20:02.200 --> 0:20:07.520 to go even further and have the government by one million, 0:20:08.080 --> 0:20:10.719 nothing short of one million bitcoins. We're talking about one 0:20:10.760 --> 0:20:14.000 hundred billioncoins are out there for you. 0:20:14.400 --> 0:20:18.840 That's about five percent meaning the total amount. Yeah, so. 0:20:20.440 --> 0:20:23.200 You know, a big question mark, a big event risk 0:20:23.840 --> 0:20:27.680 looming over this market if that bill does not sort 0:20:27.680 --> 0:20:30.520 of gain more support. So far, she's the only sponsor 0:20:30.560 --> 0:20:33.520 of it. There is quite a bit of skepticism that 0:20:33.520 --> 0:20:36.960 she'll be able to get that passed, but the market 0:20:37.040 --> 0:20:39.720 is thinking there's a good chance of that, and not 0:20:39.760 --> 0:20:41.960 only that that other governments will have. 0:20:41.880 --> 0:20:42.680 To follow suit. 0:20:42.720 --> 0:20:45.400 You know, if if the US suddenly is treating bitcoin 0:20:45.520 --> 0:20:49.520 like a major reserve asset, you know other governments will 0:20:49.600 --> 0:20:52.000 likely be inspired her to do the same. So that's 0:20:52.080 --> 0:20:55.080 kind of the backdrop for this just parabolic rally to 0:20:55.119 --> 0:20:56.440 the upside that we've seen. 0:20:56.400 --> 0:20:59.639 Because right now it sounds a little bit like they 0:20:59.680 --> 0:21:02.159 would like to think about bitcoin the way we currently 0:21:02.200 --> 0:21:05.159 think about gold, where we have gold sitting at Fort Knox. 0:21:05.359 --> 0:21:08.840 That that's exactly right, and what the Loomis Bill would 0:21:08.880 --> 0:21:10.480 do would be sell. 0:21:10.280 --> 0:21:11.120 Off some of that. 0:21:11.240 --> 0:21:15.719 The FED doesn't own physical gold, they owned certificates that 0:21:15.800 --> 0:21:19.200 represent gold held in Fort Knox by the Treasury. Her 0:21:19.280 --> 0:21:23.320 bill would require the Fed to start selling gold to 0:21:23.400 --> 0:21:26.199 buy bitcoin. Wow, just sort of replace it as a 0:21:26.240 --> 0:21:31.960 reserve asset. Now, obviously, you know you think about telegraphing 0:21:31.960 --> 0:21:36.160