Speaker 1: Hello, and welcome to What Goes Up, a weekly markets podcast.
Speaker 1: My name is Mike Reagan. I'm a senior editor at Bloomberg,
Speaker 1: and I'm about a high across ASID reporter with Bloomberg.
Speaker 1: This week on the show, Well, stocks are all over
Speaker 1: the map again, with benchmark indexes moving one to three
Speaker 1: per cent or more each day between their highs and lows,
Speaker 1: and treasury yields continue to creep higher. Most are at
Speaker 1: the hyst in more than fifteen years. Meanwhile, just about
Speaker 1: everyone is convinced that at least a mild recession is
Speaker 1: on the horizon. So what on earth are you supposed
Speaker 1: to do with your money at a time like this.
Speaker 1: We'll get into it with the chief market strategist of
Speaker 1: a major investment company, But first, fill Donna, just get
Speaker 1: it out of your system. I I know what you
Speaker 1: want to do with your money. You want to bet
Speaker 1: on the Buffalo bills forever, at least at least gloat
Speaker 1: about the Buffalo bills. So get it out of your system.
Speaker 1: Go ahead. I'm not going to gloat. I'm a very
Speaker 1: superstitious person, so I need good karma, so no gloating
Speaker 1: on on my end. However, Josh Allen is a superhuman.
Speaker 1: Did you watch the game? He's pretty good? Yeah, I watched.
Speaker 1: I watched most of it. I uh, did you see
Speaker 1: him jump over that man? He jumped over a man?
Speaker 1: Who does that? He jumped like eight feet into the
Speaker 1: air that I can barely jump over a small child.
Speaker 1: How a woman who grew up where you grew up
Speaker 1: is not an Eagles fan or at least a Giants
Speaker 1: are Jets fan? I would I would even allow Giants
Speaker 1: or Jets. No, your tongue not giants, No, no, no, yeah,
Speaker 1: no Eagles. I'm with you on the Eagles, definitely. Uh.
Speaker 1: And I'm rooting for them. I'm happy that they're doing well.
Speaker 1: But the Bills are so fun to watch. Was your
Speaker 1: husband lured you into the Bills name? Yeah he's from Buffalo, Yeah,
Speaker 1: he's from Well you're you're a good wife. My wife
Speaker 1: is an Eagles fan too. There's no way I could
Speaker 1: have lured her away from the Eagles of fire. I
Speaker 1: have an Eagles jersey. Of all the games I've been
Speaker 1: to in my life, the majority of them were Eagles games.
Speaker 1: All Right, there you go, I'll give you that. How
Speaker 1: many folding tables are left in your apartment right now. Oh. None, none,
Speaker 1: They've all been broken through. They've all been broken by
Speaker 1: Bills fans. Yeah, Wills fans has set themselves on fire
Speaker 1: and then jumped through tables as as one does. Yes,
Speaker 1: we have a guest here with us. We should bring
Speaker 1: her in. Christina, who per chief Global Market Strategy, said Investco,
Speaker 1: thank you so much for joining us, Thank you for
Speaker 1: having me. Christina might be a Jets or a Giants fan,
Speaker 1: but well we'll leave that for another coming. All right,
Speaker 1: spell the beans, Christina, who's your team? The next, the next,
Speaker 1: the nick It's like it's like um poo petually being
Speaker 1: in the seventh circle of hell. That's good. I didn't
Speaker 1: want to say anything. I didn't want to say anything.
Speaker 1: But you definitely develop an important skill, uh, in terms
Speaker 1: of patience and persistence and and constant optimism, or else
Speaker 1: you would just exactly else, you would just lose your mind.
Speaker 1: That's a buy and hold franchise, I guess for sure.
Speaker 1: But Christina, markets have been very interesting in the last
Speaker 1: couple of days, and I was hoping to just start
Speaker 1: out with you're talking about what it's been like to
Speaker 1: be a part of this market, to be watching this
Speaker 1: market and everything that we've seen going on where we
Speaker 1: have these you know, stretches of days where it's up
Speaker 1: two percent, down two down. It's just very volatile. It's
Speaker 1: incredibly volatile, and yet in a way it makes sense
Speaker 1: given that we have this one key driver of markets
Speaker 1: this year, and it's been the FED and really the
Speaker 1: just dramatically shifting expectations around what the Fed is going
Speaker 1: to do. The FED has even surprised itself. You know,
Speaker 1: if we look at the dot plot from December of one,
Speaker 1: they thought they'd be at ninety basis points at the
Speaker 1: end of two. Now they think as of the September
Speaker 1: dot plot they'll be at four forty basis points. That
Speaker 1: to me is monetary policy whiplash. And those kinds of
Speaker 1: surprises are are why we see the volatility, not just
Speaker 1: in stocks, but in bonds. You know, Christine, I know
Speaker 1: a lot of people were hoping that at least we
Speaker 1: get some diversion from the FED focused during earning season,
Speaker 1: and it seemed like, you know, the first couple of
Speaker 1: earlier reporters, uh really sort of reignited some of the
Speaker 1: bullish instincts in the market, and that's why we saw
Speaker 1: some some really big gains. What are you looking out
Speaker 1: for an earning season? Uh? What have you learned so far? Um?
Speaker 1: You know, is there enough meat on the bone and
Speaker 1: earnings to to maybe overpower that fed uh fixation in
Speaker 1: the market. Great questions, so, and great questions. So let
Speaker 1: me start at the beginning. What I've learned so far? Um?
Speaker 1: First of all, it has been you know, fairly focused
Speaker 1: on financials thus far. UM. What we've learned is that
Speaker 1: consumers and businesses are in pretty good shape. Right. We've
Speaker 1: heard that from multiple bank uh CEO s is that
Speaker 1: that the consumers in good shape, businesses are in good
Speaker 1: shape UM. And and that certainly is a positive in
Speaker 1: terms of being able to weather economic headwinds, but it
Speaker 1: is a negative in that the FED doesn't seem to
Speaker 1: have cool demand very much. UM. We also know financial
Speaker 1: conditions are tightening. We're hearing that, we're seeing it in
Speaker 1: the data bank banks are providing in terms of, you know,
Speaker 1: the average FICO score for people they're giving mortgages to. UM.
Speaker 1: So fundamentals are are solid, um. But but clearly lenders
Speaker 1: are becoming increasingly discerning UM, which is what the FED
Speaker 1: wants to see. And we've also heard from a few
Speaker 1: airlines UM, one major airline saying that that the summer
Speaker 1: was very strong and they don't think that the demand
Speaker 1: for travel that thirst has been quenched yet. UM. So
Speaker 1: So you know, as I as I process the earnings reports,
Speaker 1: I'm I'm beyond just the earnings results, which have been
Speaker 1: relatively positive. You know, my takeaways are that the FED
Speaker 1: hasn't necessarily achieved UM what it wants to uh yet
Speaker 1: and so we could be in store for for a
Speaker 1: fair number more rate hikes UM given this environment, Christina
Speaker 1: and I ask you, we used to think about the
Speaker 1: earning season as as a stretch of time that will
Speaker 1: give us clarity on things that are going on. Can
Speaker 1: we make that same case this time around? Or is
Speaker 1: it so much that there's so much uncertainty with the FED,
Speaker 1: the macrol look, etcetera, that the earning season really even
Speaker 1: can't be giving us as much clarity as you might
Speaker 1: have in the past. I think that's true to a
Speaker 1: certain extent. I mean, let's think about it. You know,
Speaker 1: earning season and j general UM is backward looking. What
Speaker 1: we can glean about the future comes from UM. What
Speaker 1: is shared on the earnings calls um to the extent
Speaker 1: that management teams are willing to provide an outlook, and
Speaker 1: I think it is UM far less clear because they
Speaker 1: don't know where the FED funds rate is going to
Speaker 1: go from here, and they really don't know how much
Speaker 1: damage has been done thus far, because it takes some
Speaker 1: time UM for that to actually make its way into
Speaker 1: the main street economy and and show up in data
Speaker 1: and certainly show up in their results. So I think
Speaker 1: the question remains, you know, when is that other shoe
Speaker 1: going to drop? Visa V earnings? Now, for some industries
Speaker 1: it could very well drop this quarter, but but for
Speaker 1: others it might not be this quarter, It might be
Speaker 1: next or beyond. So what do you think we need
Speaker 1: to see to get uh either not necessarily even a
Speaker 1: full pivot from the Fed. I think you know, a
Speaker 1: lot of people would be happy with just sort of
Speaker 1: a go back to a fifth year basis point at
Speaker 1: rate hike. But what what really where do you need
Speaker 1: to see that inflation start to cool off? I'm guessing
Speaker 1: is it the shelter and rent costs? Is that the
Speaker 1: Is that the main issue that's still front and center
Speaker 1: for them? Do you think, well, I think that's certainly
Speaker 1: one key issue for them, but beyond that, I mean,
Speaker 1: what we're seeing is a labor market that remains very tight,
Speaker 1: and so that's showing up on the services side of
Speaker 1: the economy, UM, that's showing up in in the wage
Speaker 1: growth we've seen thus far. So you know, the FED,
Speaker 1: I think, is looking at the economy through a Phillips
Speaker 1: curve lens, and it believes it needs to achieve a
Speaker 1: certain level of unemployment in order to see inflation moderate UM.
Speaker 1: I would argue that doesn't have to be the case, though,
Speaker 1: given this unique market environment where we have just such
Speaker 1: a high level of job openings. Even after the last
Speaker 1: Jolts report, we still have more job openings than there
Speaker 1: are people to fill them. And so if we were
Speaker 1: to see a major slashing of job openings, that reduces
Speaker 1: labor mobility. Uh and and so that goal of of
Speaker 1: moderating wage growth UM could potentially be achieved without having
Speaker 1: very significant layoffs, without having a very substantial increase in unemployment.
Speaker 1: So can you talk about what you foresee from the
Speaker 1: Fed in the coming months, because we have the FED
Speaker 1: minutes come out, but recently it was just last week,
Speaker 1: and then also we had a report from Bloomberg, where
Speaker 1: one of my colleagues actually looked through the minutes and
Speaker 1: found I guess it was some detail that others hadn't noticed,
Speaker 1: saying that FED officials were worried that the that we
Speaker 1: were coming off of an extremely hot economy and that
Speaker 1: that means that potentially they would be tightening for more
Speaker 1: aggressively or for for longer than previously thought. So what
Speaker 1: are you expecting from the Fed? Well, certainly the most
Speaker 1: recent fo MC minutes, UM, we're not dubvish by any
Speaker 1: stretch of the imagination. I think people held, you know,
Speaker 1: people um anchored to that statement about a few participants
Speaker 1: worrying that um, they were moving too quickly, they'd need
Speaker 1: to calibrate because of of the delayed impact on the economy.
Speaker 1: But in general, I think what the FED is telling
Speaker 1: us is that inflation is not just job number one,
Speaker 1: it's job number one, number two, number three, UM, and
Speaker 1: that dual mandate really that that other part of the
Speaker 1: dual mandate is is really getting going being put on
Speaker 1: the back burner, um on the way way back burner,
Speaker 1: as if focuses on inflation. So that says to me
Speaker 1: that the FED will definitely high rates seventy five basis
Speaker 1: points in November, UM, and I think seventy five basis
Speaker 1: points is on the table for December as well. I
Speaker 1: think that's a very real um uh likelihood, especially given
Speaker 1: you know some of the recent statements we've gotten UM
Speaker 1: arguing that UH that you know, the FED wants to
Speaker 1: front load rate hikes like the Bank of Canada. Well,
Speaker 1: you know, I thought we were like in the sixth
Speaker 1: or seventh inning when it comes to rate hikes. So
Speaker 1: to hear they're still talking about front loading UM causes
Speaker 1: a little concern and does raise questions about when when
Speaker 1: this finally comes to an end or even just eases somewhat.
Speaker 1: You know, Christina, you mentioned the notion of the Fed
Speaker 1: uh tightening until it breaks something, And it seems like
Speaker 1: at the moment it's pretty close to a consensus that
Speaker 1: the US is going to slide into at least a
Speaker 1: shallow recession next year. UM. But I also look at
Speaker 1: the market. You know, SMP five down as much as
Speaker 1: and change percent from its high nas Doock index is
Speaker 1: down even more in the thirties of percentages. With everybody
Speaker 1: bracing for this recession, I mean, are we in one
Speaker 1: of these crazy scenarios where the market is so far
Speaker 1: ahead of the economy that it's it's mostly all been
Speaker 1: priced in or almost all priced in. And if we
Speaker 1: do get that slow down, that, uh you know, we'll
Speaker 1: see that sort of contrarian instinct kick in and we'll
Speaker 1: get a rally in the equity market. You think it's
Speaker 1: the worst priced in? Do you think? I don't think
Speaker 1: it's all priced in, but I do think some is
Speaker 1: priced in. I mean, what we've seen this year is
Speaker 1: a multiple contraction. I'm driven by the rise in the
Speaker 1: ten year yield um? But has you know, has earnings
Speaker 1: disappointment been fully priced in? Probably not, because we don't
Speaker 1: know the extent of the impact earnings, because we don't
Speaker 1: know the path of rate hikes from here. Uh So
Speaker 1: I think that there's that level of uncertainty that that
Speaker 1: makes it hard to price in. And uh to me,
Speaker 1: I think there's the potential for another leg down. Are
Speaker 1: we going to go down as as much as we
Speaker 1: have of thus far? No? I highly doubt that, UM,
Speaker 1: but I do think we could see another five to
Speaker 1: seven percent drop too before we get to the point
Speaker 1: UM where it's priced in and and where we're ready
Speaker 1: to perhaps begin a bowl market, um that is anticipating
Speaker 1: in economic recovery. And why has it been so difficult
Speaker 1: to price things into the market this year? Is it
Speaker 1: just because we have this discrepancy between what's going on
Speaker 1: with the labor market and what's happening with inflation in
Speaker 1: the Fed. Yeah, in a word, it's it's uh, seventy
Speaker 1: is the new twenty five. When you're raising rates in
Speaker 1: seventy five bases point increments UM, and you're not giving
Speaker 1: any time to for it to process through and make
Speaker 1: its way through the day into the data. UM, you're
Speaker 1: playing a dangerous game. And the more you're doing it, um,
Speaker 1: the more likelihood uh you create of having a recession
Speaker 1: and a significant recession. So I think that is is
Speaker 1: what's behind us. I think there's a lot of uncertainty
Speaker 1: and and and as you point out, there's uncertainty around
Speaker 1: inflation and where that goes from here. It's been stubbornly high. Christina.
Speaker 1: You know when you say seventy five is the new careful,
Speaker 1: you're setting Villdon off for a joke about my age.
Speaker 1: You know, I can't say anything. Yeah, yeah, right, of course, Christina.
Speaker 1: You know, Investco's a huge company, famous for a lot
Speaker 1: of things, a lot of different investment strategies. UM. But
Speaker 1: I think if you do like a name association with
Speaker 1: a lot of people, they'll go right to the q
Speaker 1: q Q, you know, the Nasdaq one hundred, uh et F.
Speaker 1: I think you know a lot of people that I've
Speaker 1: talked to, I've always gotten the sense that once we
Speaker 1: got through the other side of the pandemic, when interest
Speaker 1: rates normalize, growth normalizes, and and life becomes more or
Speaker 1: like it was pre pandemic, that we once again see
Speaker 1: that instinct to buy big growth tech uh. You know,
Speaker 1: really the main companies in the in the q q
Speaker 1: Q E t F. Is that still a real realistic
Speaker 1: assumption or anticipation, I mean, is are we going to
Speaker 1: revert back to where the big tech stocks are the
Speaker 1: stars of the show or are we just in a
Speaker 1: whole new paradigm now for the time being or for
Speaker 1: the foreseeable future. Well, I certainly think that that, Uh,
Speaker 1: it's likely we revert back to to tech performing better
Speaker 1: um than the cyclical side of the stock market in
Speaker 1: the near term. I mean, tech has been beaten down
Speaker 1: as it traditionally has been by rising rates UM. But
Speaker 1: once we get through a period of time and adjustment. UM.
Speaker 1: Usually tech then then starts to perform significantly better. Um.
Speaker 1: It's part of what investors now you as as the
Speaker 1: defensive part of the stock market. And and so I
Speaker 1: think there's there's certainly going to be a real interest
Speaker 1: that doesn't go away. Also just for the longer term,
Speaker 1: tech is a big part of innovation, it's a big
Speaker 1: driver of of where the economy goes from here. Uh So,
Speaker 1: so I think it's going to continue to be a
Speaker 1: significant portion of most investors portfolios. And as you meant,
Speaker 1: as Mike mentioned, you, you guys have this huge suite
Speaker 1: of ETF products, And I'm wondering if you are also
Speaker 1: tracking what the retail investor is doing, because you know
Speaker 1: retail investors, they tend to favory tfs a lot. But
Speaker 1: what is the retail cohort doing at the moment, Because
Speaker 1: I've seen some notes recently and some interesting research that's
Speaker 1: showing that they're selling into any rally really recently, whereas
Speaker 1: earlier in the year maybe they were buying the dip
Speaker 1: because they had been sort of conditioned to do that
Speaker 1: over the last two years. So how important or what
Speaker 1: role is the retail investor playing in this market. Well,
Speaker 1: if we were to look at UM the AII sentiment surveys,
Speaker 1: that certainly shows a very barish level of sentiment among
Speaker 1: retail investors. But I think that's the kind of thing
Speaker 1: you need, UM to help form a market bottom UM.
Speaker 1: It can be a pretty temporary phenomenon, and unfortunately, I
Speaker 1: think some retail investors hurt themselves by doing that. In fact,
Speaker 1: I'd argue perhaps the biggest mistake made in the global
Speaker 1: financial crisis or those investors, and it wasn't just retail,
Speaker 1: it was also institutional that cashed out at or near
Speaker 1: the bottom UM and then locked in their losses and
Speaker 1: weren't able to participate in in a recovery. Uh So,
Speaker 1: So certainly there's some of that going on, but hopefully
Speaker 1: more investors are thinking long term. Hopefully UM. You know,
Speaker 1: a lot of of the education that we've done has
Speaker 1: had an impact in terms of having you know, well
Speaker 1: diversified portfolio UM both across and within the three major
Speaker 1: asset classes, and also thinking long term. Because as much
Speaker 1: as this is a difficult market environment and it's painful
Speaker 1: to read the headlines and look at the statements, UM,
Speaker 1: it is still very much a temporary UM market environment,
Speaker 1: and for many that have ten and twenty year time horizons, UM,
Speaker 1: they hurt themselves by um becoming panicked or letting emotions
Speaker 1: take over right now. And uh, Christine, I know you
Speaker 1: have a global focus, So I'm gonna land the plane
Speaker 1: next in Beijing, China. The Party Congress is going on
Speaker 1: this week week. UM. I don't think any major surprises,
Speaker 1: but it's become pretty clear that their COVID zero policies
Speaker 1: are not going anywhere anytime soon, at least won't be
Speaker 1: relaxed anytime soon. How are you thinking about China and
Speaker 1: its place in global markets these days? Um? On the
Speaker 1: one hand, uh, COVID zero is sort of restraining growth
Speaker 1: there and possibly uh still snarling supply chains to some
Speaker 1: to three. On the other hand, Uh, you know that's
Speaker 1: at least one source of the world where it's not
Speaker 1: necessarily an inflationary situation. I mean, maybe it is with
Speaker 1: the supply chains. But help us sort out how to
Speaker 1: think about China where it goes from here and sort
Speaker 1: of what the dynamics with the rest of the global
Speaker 1: markets will be. Well, actually not differently than what we
Speaker 1: saw on the global financial crisis. China is in a
Speaker 1: very different place than Western developed economies UM, which makes
Speaker 1: a wonderful case for diversification of portfolios right UM. What
Speaker 1: we're seeing in China is a central bank that has
Speaker 1: actually eased monetary policy this year as opposed to tightening dramatically. UM.
Speaker 1: We're seeing some some fiscal stimulus that is significant. And
Speaker 1: so China is in a very different place than than
Speaker 1: Western economies. So yes, UH, COVID lockdowns could potentially be
Speaker 1: a headwind depending upon what what happens in term of
Speaker 1: future waves of COVID UM. But for the most part,
Speaker 1: China is ahead in terms of UM when it's likely
Speaker 1: to begin recovering, and in fact, I think we're seeing
Speaker 1: signs of recovery now UM. And that's why if you
Speaker 1: look at, for example, the I M f S projections
Speaker 1: that they put out last week in terms of growth
Speaker 1: expectations for three UM, for a lot of major economies,
Speaker 1: the anticipate growth to be lower next year than this year.
Speaker 1: That's not the case for China. Their expectation is is
Speaker 1: significantly higher growth next year UM. So and I think
Speaker 1: that makes a lot of sense just given UM the
Speaker 1: positives that are going on um in in the Chinese economy.
Speaker 1: Can you talk more about what your view is on
Speaker 1: on the possibility of us seeing a global recession. I
Speaker 1: think you had asked in one of your recent notes
Speaker 1: if a global recession is coming, Well, it is very,
Speaker 1: very possible, just given that we have so many central
Speaker 1: banks raising rates all at the same time. In fact,
Speaker 1: we heard from the World Bank last month and issuing
Speaker 1: a very stark warning about how Um, this is the
Speaker 1: first time in five decades we've seen this level of
Speaker 1: synchronicity in terms of tightening. And you don't have to
Speaker 1: play that police song in the background while I talk
Speaker 1: about this. But um, but you know it is Uh.
Speaker 1: It does increase the odds of a global recession, so
Speaker 1: we have to be um vigilant about it. Um. Uh.
Speaker 1: You know, at this point, I think that there is
Speaker 1: still the potential for us to avoid that, um, if
Speaker 1: central banks were to pivot soon. We just don't know
Speaker 1: if they're going to pivot soon. Um. That is is
Speaker 1: the big question on everyone's mind right now. But every
Speaker 1: day that goes by that we continue to be as
Speaker 1: hawkish as we see the kind of tightening we see.
Speaker 1: I think it increases the odds of a global recession
Speaker 1: next year. Well, I applaud your chase taste in music.
Speaker 1: Now I'm gonna I've got policed in my head. I'm
Speaker 1: gonna have to go go do a deep dive on
Speaker 1: the Synchronicity album. Later we'll boil it down to was
Speaker 1: Christina with. Given everything we've talked about, what's what's the
Speaker 1: Hooper sort of recommended portfolio look like these days for
Speaker 1: for sort of your average investor with you know, a
Speaker 1: longer time horizon. Well, it doesn't look that different, and
Speaker 1: it shouldn't look that different than they prescribed portfolio the
Speaker 1: Hooper portfolio from two thousand nineteen or two thousand sixteen
Speaker 1: or quite frankly two thousand ten, you know. And again,
Speaker 1: of course it depends upon the time horizon for an
Speaker 1: individual investor. But but you know, a good rule of
Speaker 1: thumb is, you know, a fifty five thirty fifteen type
Speaker 1: of portfolio where you have significant exposure to equities and
Speaker 1: not just within the US, global equities and some dividend
Speaker 1: paying equities um uh, and a very diversified fixed income
Speaker 1: portfolio um I. You know, tactically I might over emphasize
Speaker 1: the investment grade and government, right now and then of
Speaker 1: course alts UM reads in their infrastructure crypto. That's a
Speaker 1: great question. Um, you know I I what I encourage
Speaker 1: is I say, you know, you all have to do
Speaker 1: your homework on crypto. And I've told my kids this
Speaker 1: as well as UM. You know, when I talk to
Speaker 1: investors and know there's a lot of interest in it.
Speaker 1: There are a lot of differences among the different cryptocurrencies.
Speaker 1: Some might work for some investors portfolios, but others might
Speaker 1: do enough research and say this isn't for me. Um,
Speaker 1: But I think certainly be open to it and and
Speaker 1: do enough research to know whether or not it fits
Speaker 1: with your risk reward profile. Do your homework. The you
Speaker 1: probably love to win homework, didn't I love doing homework? Yeah? Yeah,
Speaker 1: I'm taking French classes now. And at the end when
Speaker 1: she doesn't sign homework, I'm like, do you have extra
Speaker 1: stuff we can possibly? Were you a teacher's pad too?
Speaker 1: I want to learn? Hello? Well, all right, here's a
Speaker 1: little bit of a curveball addition to that question, Christina.
Speaker 1: If I'm theoretically an investor who's sitting all in cash
Speaker 1: right now, enjoying these juicy buney market yields, that are
Speaker 1: finally you know something that doesn't round a zero? Does
Speaker 1: Does that advice still stand? Well, what I would say
Speaker 1: is you don't want to go all in, you want
Speaker 1: a dollar cost average back in. But starting now makes
Speaker 1: a lot of sense. I mean we've already seen a
Speaker 1: very very significant adjustment and markets, I mean fixed income levels,
Speaker 1: you know, fixed income yield levels are pretty attractive right now.
Speaker 1: So that's not to say we aren't going to see
Speaker 1: more volatility. Um, it's not to say that we might
Speaker 1: not see a leg down for the stock market, as
Speaker 1: I said, as rates go up. But we can never,
Speaker 1: as humans precise sleep pinpoint when to enter the market. Um,
Speaker 1: that's just very very hard to do. So I think
Speaker 1: dollar cost averaging in makes a lot of sense in
Speaker 1: this environment where um, we've certainly seen significant losses this
Speaker 1: year and and valuations are more attractive. Well, Christina Hooper,
Speaker 1: Chief Global Markets, try to just at invest go We
Speaker 1: really appreciate it. If you know, if you have some
Speaker 1: homework you can give Vodanna maybe a worksheet. We're signment.
Speaker 1: I don't know a book. Do you want to start
Speaker 1: a book club? I actually much more interested in a
Speaker 1: movie club. I find just too much of a commitment
Speaker 1: to read, but I can easily watch a movie and
Speaker 1: then talk to you about I just don't want Mike
Speaker 1: to be part of this club. Ldona will read the
Speaker 1: book and you can watch the movie. I think that
Speaker 1: a hybrid like breakfast, like breakfast at Tiffany's in that
Speaker 1: famous Seinfeld episode. That's great, But we cannot let you
Speaker 1: leave quite just yet, because we have a tradition on
Speaker 1: this show. So I may call it a gimmick. I
Speaker 1: prefer tradition where no guest is allowed to leave before
Speaker 1: they share the craziest thing they've seen in markets this week.
Speaker 1: You start us off FELDA, Okay, mine is Halloween fall,
Speaker 1: pumpkin um Thanksgiving is related? I suppose, okay, it is.
Speaker 1: But I wanted to I really wanted to use this
Speaker 1: one just so I can take the opportunity to say
Speaker 1: that all the reporters on the Cross Acid team are
Speaker 1: getting together to carve pumpkins. But I didn't invite I
Speaker 1: didn't invite you, so and I'm not extending the invite.
Speaker 1: That's that's how it tends to go. You're not invited.
Speaker 1: So anyway, so cold so pumpkins, spice foods, cost A
Speaker 1: hundred and sixty more than regular versions of things. Did
Speaker 1: you see this story? This is crazy. It's called they're
Speaker 1: calling it. I saw this on CBS News. They're calling
Speaker 1: it the pumpkin spice tax. So it's in everything, Latte's, croissants, Hummus, which,
Speaker 1: by the way, pump can Pummics that's pumpkin spice. Pumics
Speaker 1: doesn't sung good dog treats, etcetera, etcetera. So basically, just
Speaker 1: if anybody is has you know, if any one of
Speaker 1: these companies has a pumpkin spiced version of a product,
Speaker 1: they can just up charge you for it. And we
Speaker 1: all love pumpkin spice so much we just go and
Speaker 1: pay it. Is are there like pumpkins supply chain issues
Speaker 1: or is it just no? I think it's taking advantage
Speaker 1: of taking advantage. Yeah, I mean a pumpkin pumpkin spice
Speaker 1: latte at Starbucks. I'm pretty sure it's like thirty six
Speaker 1: dollars right now. Yeah, and it tastes a hundred and
Speaker 1: sixty worse than the than the regular one. Yes, I don't.
Speaker 1: I don't get this at all. Oh I like that stuff, buddy,
Speaker 1: I'll go with Yeah, support you hear you give me good.
Speaker 1: I'm bad. Yeah, yeah, I don't know. I'm not a
Speaker 1: big pumpkin guy. I like, this is why a lot invited,
Speaker 1: you're not. I love the carve though, and I'm so
Speaker 1: hurt that I cannot join you carving pump pumpkins. Uh, Christina,
Speaker 1: how about you. What's the craziest thing you've seen? And
Speaker 1: you'll invite me pumpkin carving. I assume I don't carve pumpkins.
Speaker 1: So just so you know, you can talk to my kids.
Speaker 1: They'll tell you I am the worst mother ever. I
Speaker 1: do the bare minimum and that includes never having carved
Speaker 1: pumpkins with them. So my apologies to my kids. I'm
Speaker 1: so sorry. So no pumpkin carving for you. The no
Speaker 1: pumpkin carving. We can watch a movie about pumpkin carving
Speaker 1: if you want to, though, I'm just out of luck.
Speaker 1: Christine is all about the movies, you know. Again, there's
Speaker 1: very little commitment with a movie, you know, very passive.
Speaker 1: You can even do your work while you're watching it.
Speaker 1: You know, I need to make a movie about the
Speaker 1: next for you. That would a Spike Lee movie about
Speaker 1: the next that would actually, I'll give you a great
Speaker 1: Halloween movie that my son and I watched last week
Speaker 1: What We Do in the Shadows, one of the funniest
Speaker 1: movies I've ever seen, vampires having to live in ordinary
Speaker 1: life flatting in New Zealand, not the TV show, TV show.
Speaker 1: This is much funnier than the movie. Okay, so, but onto,
Speaker 1: I was actually very Rarius felt down. I had such
Speaker 1: a light like nice just because I wanted to bring
Speaker 1: up the pumpkin carving. I love it, well, I I
Speaker 1: just I just focused on inflation expectations because it's a
Speaker 1: head scratcher. Longer term inflation expectations over the last few
Speaker 1: months have UM gone down. It's been nice to see
Speaker 1: that movement down. And then UM within the last week
Speaker 1: week and a half, UM, we saw an uptick in
Speaker 1: both the Michigan survey of longer term inflation expectations as
Speaker 1: well as the New York FETE. If that trend work continue,
Speaker 1: that would be UM concerning. It is a surprise, just
Speaker 1: given that we're already sighting starting to see the air
Speaker 1: taken out of the sales of the economy. UM, but
Speaker 1: that is not how consumers see it right now. And
Speaker 1: and uh, you know, five years ahead, three years ahead, UM,
Speaker 1: the measure has gone up since since the previous reading.
Speaker 1: Are they those the two best expectation readings? Do you
Speaker 1: think to keep an eye on? You know, I think
Speaker 1: it's sort of I don't if it's surprised people, but
Speaker 1: it's certainly many people noted it. When it was office
Speaker 1: Pal or someone else on the FED really started talking
Speaker 1: about the Michigan survey. Um uh, that that was That
Speaker 1: was actually what tipped him over the edge. That in
Speaker 1: the c p I print. If you remember, back in June,
Speaker 1: they were messaging fifty basis points and then they got
Speaker 1: a hot c p I and a hot inflation expectations
Speaker 1: from Michigan, and within a few days they had the
Speaker 1: f o MC meeting and they decided for seventy bas
Speaker 1: points instead of fifty. So you're absolutely right they pay
Speaker 1: attention to it. I think consumer surveys are far more
Speaker 1: important to them than market based measures of inflation expectations. Yeah. Well,
Speaker 1: as a big ten fan, I think they're giving way
Speaker 1: too much credit to the University of Michigan. That's all
Speaker 1: I'm going to say about that. Tell me what the
Speaker 1: Michigan state inflation anyway, that's that's neither here nor there.
Speaker 1: That's a good market joke. Really, yeah, you're you're actually
Speaker 1: giving me credit for that one. Yeah, we should tweet it.
Speaker 1: You can tell let you tweet that one. Okay, question
Speaker 1: for both of you. How many iPhones do you think
Speaker 1: the two of you have each owned in your lifetimes.
Speaker 1: I've probably had three or four. I go very I've
Speaker 1: had mine still has the little push button. I go
Speaker 1: a very long time before I get serious button. Yes,
Speaker 1: number is that what I phone? Seven or eight or
Speaker 1: something something. Yeah, it's it's doubled. Basically, the numbers have
Speaker 1: doubled since the last time I got one. It's like
Speaker 1: on fourteen. Now. Yeah, how about you, Christie? Kids and family?
Speaker 1: How many? How many do you think you've gone through? Oh?
Speaker 1: In our family, I have three kids and a husband,
Speaker 1: so I mean in the same I'm in the same boat.
Speaker 1: So in total, we've probably owned. Especially my daughter and
Speaker 1: she dropped It's an embarrassing story, but my she was
Speaker 1: making my son take photographs of her, and she was
Speaker 1: telling him to get closer. She was in her swimsuit,
Speaker 1: and he dropped the phone in the pool. So that
Speaker 1: was one right there. Um. And and by the way,
Speaker 1: you have to race to get to that dryer to
Speaker 1: try to dry it. It still doesn't work. Familiar and
Speaker 1: oh god, you know, we tried everything. So I want
Speaker 1: to say like, wow, yeah, yeah, I'm up there. So
Speaker 1: I was gonna get you know, with three kids, probably
Speaker 1: fifteen at least anyway, but no one cares for them.
Speaker 1: If you're paying for it, you care for it a
Speaker 1: lot more than when you're a kid and your parent
Speaker 1: cares for it. I've got mine in like an otter
Speaker 1: box case, like nothing's ever happened to it. They all
Speaker 1: walk around with crack screens. They couldn't care less, you know, yeah, yeah, yeah,
Speaker 1: Well here's a crazy story for you. The iPhone one.
Speaker 1: Did you ever any iPhone ones in your house? But
Speaker 1: I know what you're gonna say. It just auction for
Speaker 1: a lot of money or or something, and it's but
Speaker 1: it was completely wrapped in its package and untouched. All right,
Speaker 1: all right, spoiler a little a little bit of really sorry.
Speaker 1: I apologize that was bad. I'm so sorry you ruined.
Speaker 1: I don't know what came over me. So I think
Speaker 1: we know who's gonna win. The prices precise this week,
Speaker 1: because yes, a buyer pur purchased the first edition of
Speaker 1: the iPhone sold by LCG Auctions. As you're right, it
Speaker 1: was in its case, unopened two thousand and seven iPhone.
Speaker 1: So step up, you're the next contestant on the prices precise. Well,
Speaker 1: don let's start with you, because you clearly haven't read
Speaker 1: the story, like I haven't read the story. Not the
Speaker 1: person is right, we're afraid a little afraid about Barker.
Speaker 1: Is it? Is it even possible that there aren't a
Speaker 1: lot of these phones out there? Well? You got one
Speaker 1: right there. Well, it's it's funny because you trade the man,
Speaker 1: you know, I've traded so many in for the next
Speaker 1: model that who knows. But uh, this was unopened in
Speaker 1: the box, which if you're collector nerd, it's always got
Speaker 1: to be in the box and on open. Who buys
Speaker 1: things and then leaves them in the box unopened? But
Speaker 1: as such as life, someone realized, I guess that this
Speaker 1: thing was going to be worse money someday, and they
Speaker 1: saved it. So what do you think? What do you think?
Speaker 1: Mind you, this is only two thousand and seven, a
Speaker 1: mass produced device. We're not talking about a van. Go here, right, Um,
Speaker 1: I'll go with fifteen thousand dollars fifteen thousand, Christina Hooper,
Speaker 1: what's your prices precise? Yes, so I read the article,
Speaker 1: but I don't remember the number. I want to say
Speaker 1: it was fifty thou but it could have been to
Speaker 1: fifty Yeah tho dollars kind of you kind of right
Speaker 1: in the middle there. We have to do the math there,
Speaker 1: she said it could have been two fifty. I don't
Speaker 1: want to install our guests, but I think you want yet,
Speaker 1: because yeah, you have to go under. It's actually a
Speaker 1: document tree on one of the winningest people on prices
Speaker 1: right on on Netflix, in case anyone's interested. How much
Speaker 1: well on prices, right? You win like fifty bucks a time.
Speaker 1: You know they want all of like probably it's more
Speaker 1: of a social thing, you know. They get to be
Speaker 1: like the tight knit group. They're all standing outside in
Speaker 1: line to get on the show. My sister did run.
Speaker 1: I just remembered my sister was on the show one
Speaker 1: There you Go, not so long ago, like two years ago.
Speaker 1: She won a bunch of stuff. Did she win a
Speaker 1: new car? No? I wish, Oh my god, new car. No,
Speaker 1: it wasn't. She won random things. It must be much
Speaker 1: harder now, what with inflation. You know, prices are changing
Speaker 1: so quickly. Oh, that's a good point. I wonder if
Speaker 1: it's yeah, there's causing volatility and the prices right, probably
Speaker 1: they have inflation adjusted prices right now. That's good. That's
Speaker 1: that's that's kind of the theme of the whole markets
Speaker 1: this year. The prices are not right they so all right, Well, well, Donald,
Speaker 1: we'll get your sister on some time to play the
Speaker 1: prices precise with us. I think I guess she's good
Speaker 1: at it. I don't know. Yeah, yeah, she'd probably be
Speaker 1: better than I am at prices precise right. Well, I
Speaker 1: think that is all our time. Christina Hooper. It's always
Speaker 1: such a treat to catch up with you, and here
Speaker 1: you're thinking, Uh, you explain the dynamics of the market
Speaker 1: so eloquently and clearly, and we really appreciate you spending
Speaker 1: some time with us and doing so. Thank you so
Speaker 1: much for having me. Thank you, what goes up. We'll
Speaker 1: be back next week and so then you can find
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Speaker 1: Thanks for listening, See you next time. Thank thank thank