1 00:00:13,520 --> 00:00:16,560 Speaker 1: Hello, and welcome to What Goes Up, a Bloomberg Weekly 2 00:00:16,600 --> 00:00:20,040 Speaker 1: Markets podcast. I'm Sarah pont Zach, a market supporter on 3 00:00:20,079 --> 00:00:22,560 Speaker 1: the Cross Asset Team, and i am Mike Reagan, a 4 00:00:22,640 --> 00:00:25,400 Speaker 1: senior editor on the Markets Team. This week on the show, 5 00:00:25,640 --> 00:00:28,479 Speaker 1: the first half of the year is officially over and 6 00:00:28,520 --> 00:00:30,480 Speaker 1: the scores are on the door. It was the best 7 00:00:30,600 --> 00:00:34,800 Speaker 1: first half for U S stocks since n We saw 8 00:00:34,840 --> 00:00:39,040 Speaker 1: a record rally in investment grade credit, strong numbers across commodities, 9 00:00:39,080 --> 00:00:42,160 Speaker 1: to and the list goes on. Now, what to watch 10 00:00:42,159 --> 00:00:45,560 Speaker 1: out for going forwards? Well, one thing we can watch 11 00:00:45,560 --> 00:00:48,440 Speaker 1: out for is our guests, Sarah. Two very good guests 12 00:00:48,440 --> 00:00:51,200 Speaker 1: this week, joining us for the first time on the podcast, 13 00:00:51,320 --> 00:00:54,360 Speaker 1: Mr Pim Fox. Sarah, did you know Pim was a 14 00:00:54,360 --> 00:00:57,720 Speaker 1: a onetime Florida man. I'm just learning this today. However, 15 00:00:57,760 --> 00:00:59,800 Speaker 1: he doesn't seem like he's really a big fan of 16 00:00:59,840 --> 00:01:02,720 Speaker 1: this date, well, at least not in the summertime. The 17 00:01:02,880 --> 00:01:05,000 Speaker 1: humidity and the heat, you know, moves a little too 18 00:01:05,080 --> 00:01:07,640 Speaker 1: high for me. Okay, now now the excuses come out. 19 00:01:07,720 --> 00:01:10,240 Speaker 1: That's right. We'll talk about air conditioning later on in 20 00:01:10,240 --> 00:01:13,360 Speaker 1: the program. Pim has a whole investment thesis centered around 21 00:01:13,560 --> 00:01:16,679 Speaker 1: air conditioning. It's pretty interesting actually. Also joining us from 22 00:01:16,680 --> 00:01:19,480 Speaker 1: the bonds and FX team Katie Greifeld, who I do 23 00:01:19,520 --> 00:01:22,680 Speaker 1: not believe has any Florida connections now. Actually my parents 24 00:01:22,800 --> 00:01:28,120 Speaker 1: relocated to Florida their soccer. Yeah, they made the plunge 25 00:01:28,160 --> 00:01:31,400 Speaker 1: and fulfilled the stereotypes. So you're a part time Florida 26 00:01:31,400 --> 00:01:36,240 Speaker 1: I'm the only non Florida connection here to get in. 27 00:01:36,280 --> 00:01:40,839 Speaker 1: Somehow I feel lost. Anyway, as Sarah said, the first 28 00:01:40,880 --> 00:01:44,080 Speaker 1: half of the year is in the books. What a 29 00:01:44,120 --> 00:01:48,640 Speaker 1: ferocious rally in not only stocks but bonds. Katie, that 30 00:01:48,760 --> 00:01:52,560 Speaker 1: FX markets going nowhere. However, But Pam, I'm curious, did 31 00:01:52,600 --> 00:01:55,200 Speaker 1: anything surprise you in this first half? Well, I can 32 00:01:55,200 --> 00:01:57,760 Speaker 1: give you some of the numbers. I mean, SMP five 33 00:01:57,800 --> 00:02:02,000 Speaker 1: hundred more than so far this year. Right, So the 34 00:02:02,040 --> 00:02:05,320 Speaker 1: first half of the year up. So that's kind of 35 00:02:05,360 --> 00:02:08,919 Speaker 1: bogey for all of the act of money managers. Plus 36 00:02:08,960 --> 00:02:10,600 Speaker 1: you take a look at the NASDA gets up about 37 00:02:10,639 --> 00:02:15,320 Speaker 1: twenty two percent. And as you just mentioned, bonds rally 38 00:02:15,400 --> 00:02:18,400 Speaker 1: for US treasuries I mean, dig this. You know the 39 00:02:18,560 --> 00:02:22,880 Speaker 1: four week bill will yield you two point to two percent. Oh, 40 00:02:22,960 --> 00:02:24,440 Speaker 1: but if you decide to lend your money to the 41 00:02:24,440 --> 00:02:27,600 Speaker 1: government for ten years you will only get one point 42 00:02:27,680 --> 00:02:33,560 Speaker 1: nine five so not exactly a great return, but that 43 00:02:33,720 --> 00:02:37,120 Speaker 1: inverted yield curve certainly causing a lot of consternation, and 44 00:02:37,160 --> 00:02:39,919 Speaker 1: we got to look forward to that July thirty thirty 45 00:02:40,000 --> 00:02:42,919 Speaker 1: one FED meeting to find out are they actually going 46 00:02:42,960 --> 00:02:46,080 Speaker 1: to cut rates? It really is pretty amazing. But Katie, 47 00:02:46,120 --> 00:02:50,440 Speaker 1: one place that we have not really seen any volatility, 48 00:02:50,639 --> 00:02:53,760 Speaker 1: any excitement this year, at least until maybe recently you 49 00:02:53,760 --> 00:02:56,399 Speaker 1: can make the case for is the FX market. How 50 00:02:56,480 --> 00:02:59,840 Speaker 1: difficult has it been to be a reporter who cover 51 00:03:00,000 --> 00:03:03,359 Speaker 1: as currencies this far into the year. You know, it's 52 00:03:03,360 --> 00:03:06,600 Speaker 1: been really frustrating for me as a reporter, and uh, 53 00:03:06,720 --> 00:03:08,560 Speaker 1: I imagine if you're trying to make money there, it's 54 00:03:08,560 --> 00:03:12,280 Speaker 1: even more frustrating. But yeah, you know, you've seen these 55 00:03:12,400 --> 00:03:15,760 Speaker 1: just crazy moves and bond yields all across the world, 56 00:03:15,919 --> 00:03:19,400 Speaker 1: and FX has really been trading sideways. There's just no 57 00:03:19,520 --> 00:03:23,160 Speaker 1: volatility there. And uh, you know, this is something I 58 00:03:23,200 --> 00:03:25,720 Speaker 1: talk about with sources a lot. It's all anyone wants 59 00:03:25,720 --> 00:03:29,000 Speaker 1: to talk about is where is the volatility? And I mean, 60 00:03:29,040 --> 00:03:32,600 Speaker 1: even though you are seeing these big yield moves, which 61 00:03:32,760 --> 00:03:35,960 Speaker 1: you know typically would expect currencies to respond to that's 62 00:03:35,960 --> 00:03:39,000 Speaker 1: been caused by this stubblish shift by global banks around 63 00:03:39,000 --> 00:03:42,000 Speaker 1: the world. So we're all going in the same direction 64 00:03:42,080 --> 00:03:45,320 Speaker 1: in terms of monetary policy, and that just doesn't breed 65 00:03:45,360 --> 00:03:48,280 Speaker 1: effects volatility. You know, even if you want to sell 66 00:03:48,320 --> 00:03:51,080 Speaker 1: the dollar, what do you sell it against everyone's stubblish? Yeah, 67 00:03:51,080 --> 00:03:53,160 Speaker 1: I think to put some numbers on it. Last time 68 00:03:53,160 --> 00:03:55,840 Speaker 1: I looked at a chart of the Dollar Index. Now, 69 00:03:55,880 --> 00:03:58,480 Speaker 1: this thing has been around since nineteen seventy three. I 70 00:03:58,520 --> 00:04:01,600 Speaker 1: believe the range between high and low has only been 71 00:04:01,600 --> 00:04:03,800 Speaker 1: about three and a half percent. Now, if this year 72 00:04:03,880 --> 00:04:09,920 Speaker 1: ended today, which obviously it won't, but unless Sarah, I 73 00:04:10,000 --> 00:04:12,320 Speaker 1: know nothing that you don't, you can confirm it it 74 00:04:12,320 --> 00:04:14,680 Speaker 1: would be. Then it would be the narrowest trading range 75 00:04:14,760 --> 00:04:18,159 Speaker 1: ever since at least nineteen seventy three for the dollar index. 76 00:04:18,240 --> 00:04:21,640 Speaker 1: I mean, is it? That's basically the long insured of 77 00:04:21,720 --> 00:04:24,479 Speaker 1: it is that all central banks are devilish. Uh, there's 78 00:04:24,520 --> 00:04:27,360 Speaker 1: really no edge anywhere in the currency market. Is that? 79 00:04:27,440 --> 00:04:30,960 Speaker 1: Is that the general thinking of Unfortunately, UM and I 80 00:04:31,000 --> 00:04:32,640 Speaker 1: have I'm going to one up you on a stag. 81 00:04:34,320 --> 00:04:36,320 Speaker 1: So if you go back to the first quarter, I 82 00:04:36,320 --> 00:04:38,839 Speaker 1: guess we're in the third quarter now, but Euro dollar, 83 00:04:39,000 --> 00:04:42,120 Speaker 1: which is the most actively traded currency pair, it's like 84 00:04:43,200 --> 00:04:45,920 Speaker 1: of global currency trading, and it's you know, the most 85 00:04:45,960 --> 00:04:49,960 Speaker 1: liquid market. So that was the tightest quarterly training range 86 00:04:50,200 --> 00:04:53,719 Speaker 1: since the inception of the euro. It's it's been really 87 00:04:53,800 --> 00:04:56,280 Speaker 1: grim And I was just talking about this with a 88 00:04:56,320 --> 00:04:59,719 Speaker 1: few people yesterday. I mean, is there any reason for 89 00:05:00,000 --> 00:05:03,520 Speaker 1: open the you know, the coming months and uh, unless 90 00:05:03,560 --> 00:05:06,479 Speaker 1: you think that one of these major global central banks 91 00:05:06,560 --> 00:05:08,400 Speaker 1: is going to diverge, you know, in the group of 92 00:05:08,440 --> 00:05:12,280 Speaker 1: ten space, we're really looking at more sideways trading. So 93 00:05:13,279 --> 00:05:16,320 Speaker 1: buckle up. Pinning down the trajectory of the dollar seems 94 00:05:16,360 --> 00:05:20,479 Speaker 1: like it has been extremely hard to do. However, it 95 00:05:20,560 --> 00:05:24,440 Speaker 1: doesn't just have implications for the currency markets, of course, 96 00:05:24,480 --> 00:05:28,280 Speaker 1: it's very closely interrelated with the movements in the commodity markets. 97 00:05:28,320 --> 00:05:31,960 Speaker 1: Also what it means for U S stocks or really 98 00:05:31,960 --> 00:05:35,920 Speaker 1: global stocks as well as these currency relations come into 99 00:05:35,960 --> 00:05:38,960 Speaker 1: shape going forwards, when you talk to traders, are you 100 00:05:39,120 --> 00:05:42,159 Speaker 1: hearing more that the dollar is set to fall because 101 00:05:42,160 --> 00:05:45,080 Speaker 1: the FED is incrementally turning more devish or is there 102 00:05:45,120 --> 00:05:47,000 Speaker 1: a case to be made against that too, because we're 103 00:05:47,040 --> 00:05:49,720 Speaker 1: set to see other central banks turn more dovish as well. 104 00:05:50,200 --> 00:05:52,920 Speaker 1: It's really hard and that's mostly what I hear when 105 00:05:52,920 --> 00:05:55,599 Speaker 1: I talk to people. You know, even if you really 106 00:05:55,720 --> 00:05:59,040 Speaker 1: think the US economy is going nowhere, it's going to 107 00:05:59,160 --> 00:06:02,320 Speaker 1: slow down. I mean, if you look abroad Europe, Japan, 108 00:06:02,720 --> 00:06:05,840 Speaker 1: there's you know, no reason for celebration there either. So 109 00:06:06,360 --> 00:06:07,960 Speaker 1: you know, if you want to be barish the dollar, 110 00:06:08,040 --> 00:06:10,520 Speaker 1: and this is the beauty of currencies, you have to 111 00:06:10,760 --> 00:06:14,080 Speaker 1: pick something you like better. And from what I'm hearing 112 00:06:14,120 --> 00:06:16,800 Speaker 1: too from people, you know, even if they like to 113 00:06:16,880 --> 00:06:19,760 Speaker 1: make a barished dollar call, it's really hard to have 114 00:06:19,839 --> 00:06:23,599 Speaker 1: conviction in that. So you might see some tactical trades 115 00:06:23,720 --> 00:06:26,760 Speaker 1: here and there, but you know, I'm really not getting 116 00:06:26,760 --> 00:06:30,360 Speaker 1: a high sense of conviction from really anyone I talked to. Yeah, 117 00:06:30,360 --> 00:06:34,480 Speaker 1: and obviously this type of nonvolatility is bad news for 118 00:06:34,600 --> 00:06:37,320 Speaker 1: currency traders, maybe not such bad news for the rest 119 00:06:37,320 --> 00:06:40,200 Speaker 1: of US PIM Right, you had a post talking about 120 00:06:40,200 --> 00:06:42,120 Speaker 1: how the recent weakness in the dollar. Now it is 121 00:06:42,160 --> 00:06:45,640 Speaker 1: still in this this very low range, uh small range 122 00:06:45,680 --> 00:06:47,479 Speaker 1: that it's traded in all year, but the last couple 123 00:06:47,520 --> 00:06:50,080 Speaker 1: of weeks you've seen it sell off. For example, let's 124 00:06:50,080 --> 00:06:52,680 Speaker 1: say against the Canadian looney, Right, I mean, the Canadian 125 00:06:53,000 --> 00:06:56,400 Speaker 1: government released report having to do with their trade surplus 126 00:06:56,520 --> 00:06:59,120 Speaker 1: that was a big surprise. This comes even after we 127 00:06:59,200 --> 00:07:01,920 Speaker 1: see oil decline in price over the last let's say, 128 00:07:01,960 --> 00:07:04,920 Speaker 1: a couple of months into April, and as a result 129 00:07:05,120 --> 00:07:08,240 Speaker 1: of the decline and the value of the dollar, it's 130 00:07:08,279 --> 00:07:12,720 Speaker 1: an interesting connection between loan origination in the United States, 131 00:07:12,800 --> 00:07:15,760 Speaker 1: something I had never really thought of, and a report 132 00:07:15,840 --> 00:07:19,000 Speaker 1: by the Federal Reserves. Some research took a look and said, 133 00:07:19,040 --> 00:07:22,520 Speaker 1: you know, about a two and a half percent decrease 134 00:07:22,840 --> 00:07:26,840 Speaker 1: UH in the US dollar would lead to an increase 135 00:07:27,520 --> 00:07:32,320 Speaker 1: of ten percent in US bank corporate loan origination. And 136 00:07:33,120 --> 00:07:35,800 Speaker 1: the reason the really I mean, you know, okay, you know, 137 00:07:35,840 --> 00:07:38,000 Speaker 1: you try to follow the bread crumbs here, but I mean, 138 00:07:38,240 --> 00:07:41,440 Speaker 1: the reason that was given in the research is that 139 00:07:41,560 --> 00:07:46,960 Speaker 1: typically what happens is when the dollar strengthens, that kills 140 00:07:47,040 --> 00:07:52,480 Speaker 1: emerging markets, and that typically sends everybody in one direction, 141 00:07:52,720 --> 00:07:57,440 Speaker 1: and that causes lending to pull back because it makes 142 00:07:57,560 --> 00:08:01,360 Speaker 1: people risk averse. So you see this sell off and 143 00:08:01,440 --> 00:08:05,360 Speaker 1: eat in emerging markets, you get a risk averse feeling 144 00:08:05,400 --> 00:08:10,360 Speaker 1: on the part of bankers and they contract their lending. Conversely, 145 00:08:10,600 --> 00:08:14,560 Speaker 1: if the dollar continues, its more recent slide against let's 146 00:08:14,560 --> 00:08:17,960 Speaker 1: say the Canadian looney or maybe even the euro. We've 147 00:08:17,960 --> 00:08:21,440 Speaker 1: had comments from the President having to do with currency manipulation, 148 00:08:21,440 --> 00:08:23,920 Speaker 1: whether it comes to the Euro or whether the Chinese. Uh. 149 00:08:24,120 --> 00:08:27,000 Speaker 1: You want to remember that if you get this fall 150 00:08:27,160 --> 00:08:29,400 Speaker 1: in the value of the dollar, you could see a 151 00:08:29,440 --> 00:08:32,400 Speaker 1: big boost in bank lending. And this comes at just 152 00:08:32,559 --> 00:08:35,400 Speaker 1: the same time that the Federal Reserve has also basically 153 00:08:35,400 --> 00:08:38,679 Speaker 1: taken the handcuffs off of us, you know, big financial 154 00:08:38,720 --> 00:08:41,520 Speaker 1: companies to go ahead and do stock buy backs and 155 00:08:41,640 --> 00:08:46,160 Speaker 1: increase their dividends to investors. That's very interesting, I've got 156 00:08:46,160 --> 00:08:48,880 Speaker 1: to say. But you mentioned the relationship between the dollar 157 00:08:48,920 --> 00:08:50,880 Speaker 1: and emerging markets, and I have to say, on my end, 158 00:08:50,880 --> 00:08:52,880 Speaker 1: a lot of the people I've been speaking with lately 159 00:08:53,160 --> 00:08:56,080 Speaker 1: are growing more and more bullish on emerging markets. Also 160 00:08:56,559 --> 00:08:59,880 Speaker 1: see more upside and commodities because of that relationship, and 161 00:09:00,080 --> 00:09:02,840 Speaker 1: do think that the dollar could fall further. And I 162 00:09:02,920 --> 00:09:06,280 Speaker 1: want to bring that over within the commodity space to oil. PIM, 163 00:09:06,320 --> 00:09:09,720 Speaker 1: Can you just walk us through this past week what 164 00:09:09,960 --> 00:09:12,640 Speaker 1: is going on with oil? You have all that come 165 00:09:12,640 --> 00:09:15,680 Speaker 1: out extend production cuts and then we see oil just 166 00:09:15,880 --> 00:09:18,559 Speaker 1: fall off a cliff, right, Uh, Oil the price of 167 00:09:19,040 --> 00:09:20,880 Speaker 1: let me just give you the bigger context, because you 168 00:09:20,920 --> 00:09:24,920 Speaker 1: may not call that oil crude. Oil West Texas into 169 00:09:25,000 --> 00:09:28,680 Speaker 1: media traded on the IMAX is actually up twenty five 170 00:09:29,360 --> 00:09:34,040 Speaker 1: since the beginning of the year, but still down from 171 00:09:34,040 --> 00:09:37,200 Speaker 1: the high, right, and it is down four percent just 172 00:09:37,480 --> 00:09:40,120 Speaker 1: since April. So I think that the there's a there's 173 00:09:40,160 --> 00:09:45,280 Speaker 1: a term called the recency uh bias, right, that the 174 00:09:45,400 --> 00:09:49,360 Speaker 1: things that happen most closely in time to now are 175 00:09:49,400 --> 00:09:53,559 Speaker 1: the things that dominate your thinking. And as you described it, 176 00:09:53,840 --> 00:09:57,600 Speaker 1: you have a situation where there is more oil than 177 00:09:57,679 --> 00:10:02,200 Speaker 1: there is growth and demand. And it is obviously the 178 00:10:02,240 --> 00:10:04,360 Speaker 1: OPEC plus one, you know, with Russia is saying that 179 00:10:04,360 --> 00:10:07,080 Speaker 1: they're going to curtail production. They're trying to maintain some 180 00:10:07,200 --> 00:10:11,400 Speaker 1: level of pricing. But you've got US shale producers, they're 181 00:10:11,440 --> 00:10:15,480 Speaker 1: the swing producers here. And you also have a big 182 00:10:16,000 --> 00:10:20,800 Speaker 1: switch in terms of electricity generation that's being done with 183 00:10:20,960 --> 00:10:23,880 Speaker 1: natural gas, and natural gas prices at least so far 184 00:10:24,000 --> 00:10:26,160 Speaker 1: have gone nowhere. We're in the three dollars per million 185 00:10:26,160 --> 00:10:29,240 Speaker 1: b to you. So you know, oil and energy companies 186 00:10:29,360 --> 00:10:31,160 Speaker 1: they have still been struggling. When you take a look 187 00:10:31,200 --> 00:10:34,720 Speaker 1: at their performance in the SMPA well, and natural gas 188 00:10:34,800 --> 00:10:37,120 Speaker 1: not exactly in short supply in this country, You're correct. 189 00:10:37,320 --> 00:10:39,640 Speaker 1: I mean, you know, they have some cases where because 190 00:10:39,800 --> 00:10:44,880 Speaker 1: of the pipeline bottlenecks that producers of natural gas are 191 00:10:44,960 --> 00:10:49,600 Speaker 1: actually paying to have someone take the natural gas away. 192 00:10:49,880 --> 00:10:54,520 Speaker 1: Negative actually negative pricing for certain types of natural gas. 193 00:10:55,000 --> 00:10:59,200 Speaker 1: Well somewhere, we're negative pricing isn't uncommon? Is the sovereign 194 00:10:59,240 --> 00:11:02,559 Speaker 1: bond market around the globe now a day's This past 195 00:11:02,600 --> 00:11:05,360 Speaker 1: week we did also get some new news regarding the 196 00:11:05,360 --> 00:11:08,079 Speaker 1: European Central Bank, and that is the nomination of Madame 197 00:11:08,200 --> 00:11:12,120 Speaker 1: Christine Legard to potentially head up the ECB after Mario 198 00:11:12,200 --> 00:11:15,439 Speaker 1: drags exit. What implications could this possibly even have for 199 00:11:15,559 --> 00:11:19,640 Speaker 1: Marcus Katie, Yeah, so Christine Legard, it's it's great because 200 00:11:19,720 --> 00:11:22,240 Speaker 1: you know, we know her views, we know her record, 201 00:11:22,800 --> 00:11:26,960 Speaker 1: and uh, talking to people, I really hear that she's 202 00:11:26,960 --> 00:11:30,040 Speaker 1: probably gonna you know, continue on, uh you know the 203 00:11:30,120 --> 00:11:33,920 Speaker 1: drag e trajectory, bring in some more easing and uh 204 00:11:34,080 --> 00:11:36,840 Speaker 1: that should you know, that's good news for bonds, in 205 00:11:36,920 --> 00:11:40,600 Speaker 1: particular Italian bonds, and you've been seeing yields drop there 206 00:11:41,120 --> 00:11:43,640 Speaker 1: and she hasn't even you know, been confirmed yet in 207 00:11:43,720 --> 00:11:46,840 Speaker 1: terms of buns. Though, it's interesting, you know, with buns 208 00:11:46,880 --> 00:11:54,840 Speaker 1: already near record low yields negative right, yeah, very negative negative? 209 00:11:54,920 --> 00:11:58,880 Speaker 1: What what what can they buy that they haven't already bought? 210 00:11:58,960 --> 00:12:01,840 Speaker 1: And if your money sitting at the central bank is 211 00:12:01,880 --> 00:12:08,000 Speaker 1: actually disappearing, what incentive could they possibly offer corporations to 212 00:12:08,040 --> 00:12:10,400 Speaker 1: actually spend the money. And when the news came out 213 00:12:10,440 --> 00:12:13,280 Speaker 1: that Laguard was going to be Draggings replacement, you did 214 00:12:13,280 --> 00:12:15,640 Speaker 1: see that drop in the euro suggesting that people think 215 00:12:15,679 --> 00:12:18,160 Speaker 1: she will even be more dovish. So yeah, I guess 216 00:12:18,200 --> 00:12:20,920 Speaker 1: I I echo him's question, what what what will they buy? Well, 217 00:12:20,920 --> 00:12:24,160 Speaker 1: I'm excited to find out. I think we all are. 218 00:12:24,240 --> 00:12:26,200 Speaker 1: The euro. It's interesting though, and this is something I 219 00:12:26,280 --> 00:12:29,440 Speaker 1: was talking about with people. So yes, uh, the e 220 00:12:29,520 --> 00:12:31,880 Speaker 1: c B has an easing bias, we know that. But 221 00:12:32,280 --> 00:12:34,199 Speaker 1: you know, if push comes to shove and we really 222 00:12:34,360 --> 00:12:37,040 Speaker 1: enter a global easing cycle, the Fed has much more 223 00:12:37,120 --> 00:12:40,880 Speaker 1: ammunition to cut rates to ease policy than the ECB. 224 00:12:41,040 --> 00:12:44,160 Speaker 1: They're kind of tapped out when it comes to monetary policy, 225 00:12:44,200 --> 00:12:47,600 Speaker 1: so that actually, you know, the Euro might struggle to 226 00:12:47,720 --> 00:12:51,000 Speaker 1: weaken too much against the dollar given that, you know, 227 00:12:51,080 --> 00:12:53,920 Speaker 1: just the Fed has so much more room to ease policy, 228 00:12:54,440 --> 00:12:57,440 Speaker 1: which again brings us back to this ranger trading in So, 229 00:12:58,120 --> 00:13:00,160 Speaker 1: with the fed's next meeting coming up at the end 230 00:13:00,160 --> 00:13:03,640 Speaker 1: of July, um you have the stock market just dare 231 00:13:03,640 --> 00:13:06,720 Speaker 1: I say the word melt up, but just flying higher, 232 00:13:06,720 --> 00:13:10,720 Speaker 1: as Pim said, nineteen percent or whatever higher for the 233 00:13:10,840 --> 00:13:13,360 Speaker 1: SMP five And of course we're gonna get it. You know, 234 00:13:13,480 --> 00:13:16,560 Speaker 1: probably what July mid July fifteen, we're gonna start getting 235 00:13:16,559 --> 00:13:19,840 Speaker 1: earnings for the second quarter, and we'll see whether corporate 236 00:13:19,880 --> 00:13:22,320 Speaker 1: earnings are are keeping pace because the pe on the 237 00:13:22,440 --> 00:13:25,199 Speaker 1: SMP five hundred I think right now is like eighteen 238 00:13:25,360 --> 00:13:28,520 Speaker 1: nineteen depending upon how you look at it. That's historically 239 00:13:28,520 --> 00:13:47,439 Speaker 1: pretty high. So, Katie, do people really believe that we're 240 00:13:47,440 --> 00:13:49,480 Speaker 1: going to get this rate cut? Even with the stock 241 00:13:49,520 --> 00:13:51,360 Speaker 1: market shooting to the moon like this? I mean, is 242 00:13:51,400 --> 00:13:54,160 Speaker 1: this sort of ratching those bets down a little bit 243 00:13:54,160 --> 00:13:56,880 Speaker 1: as we watch stocks higher? You know, it's really crazy, 244 00:13:56,960 --> 00:13:59,400 Speaker 1: but it doesn't seem like it. It really still feels 245 00:13:59,400 --> 00:14:02,560 Speaker 1: like July is a lock. You know, of a week 246 00:14:02,679 --> 00:14:05,480 Speaker 1: or two ago, we were saying maybe fifty basis points 247 00:14:05,480 --> 00:14:08,760 Speaker 1: and obviously Bullard poured some cold water on that, but 248 00:14:09,400 --> 00:14:12,040 Speaker 1: I would love to see what it would take to 249 00:14:12,080 --> 00:14:15,439 Speaker 1: get the market to sort of pair those bets, because 250 00:14:15,720 --> 00:14:17,920 Speaker 1: I mean, even with the outcome of the G twenty meeting, 251 00:14:18,000 --> 00:14:21,760 Speaker 1: you really didn't see expectations, Budge. And you know, these 252 00:14:21,800 --> 00:14:24,760 Speaker 1: geopolitical tensions was a large in a large part what 253 00:14:25,000 --> 00:14:28,520 Speaker 1: caused this repricing of the FED. And initially when when 254 00:14:28,560 --> 00:14:30,960 Speaker 1: you said sorry, when you said Jim Jim Bullard of 255 00:14:31,000 --> 00:14:33,120 Speaker 1: the St. Louis FED. And it makes me think about 256 00:14:33,160 --> 00:14:36,720 Speaker 1: the two new members that the President has proposed for 257 00:14:36,760 --> 00:14:39,960 Speaker 1: the Federal Reserve. One of them is coming from the St. 258 00:14:40,000 --> 00:14:43,200 Speaker 1: Louis FED. This is Christopher Waller, right, he's the director 259 00:14:43,240 --> 00:14:46,280 Speaker 1: of research there. And then you've got Judy Shelton, who 260 00:14:46,360 --> 00:14:49,040 Speaker 1: at one time, well I don't know whether she still does, 261 00:14:49,080 --> 00:14:50,840 Speaker 1: but at one time she talked about the return to 262 00:14:50,880 --> 00:14:53,800 Speaker 1: the gold standards. We sounds like some others that we've 263 00:14:53,840 --> 00:14:56,000 Speaker 1: heard nominated to the FED boards. And you know, you 264 00:14:56,320 --> 00:14:57,760 Speaker 1: you take a look at the price that you talked 265 00:14:57,760 --> 00:14:59,560 Speaker 1: earlier about, So, okay, what do you do if you 266 00:14:59,600 --> 00:15:02,080 Speaker 1: sell the dollar? A lot of people have been buying gold. 267 00:15:02,160 --> 00:15:05,600 Speaker 1: You've seen the gold rally up what about ten year 268 00:15:05,640 --> 00:15:08,640 Speaker 1: to date, and most of that has really come in 269 00:15:08,680 --> 00:15:13,040 Speaker 1: the last month. It's it's very clear that when President 270 00:15:13,080 --> 00:15:16,480 Speaker 1: Trump is either tweeting or even going ahead and nominating 271 00:15:16,520 --> 00:15:19,720 Speaker 1: people to the FED board, he wants doves. He wants 272 00:15:19,720 --> 00:15:22,320 Speaker 1: people who are going to go in to the FED 273 00:15:22,600 --> 00:15:27,080 Speaker 1: and really fight for cuts and see easier monetary policy. 274 00:15:27,080 --> 00:15:29,200 Speaker 1: And I will say, if you go back and you 275 00:15:29,280 --> 00:15:32,400 Speaker 1: look through history, it's really not uncommon actually for the 276 00:15:32,400 --> 00:15:36,360 Speaker 1: FED to cut rates with socks near all time highs. 277 00:15:36,360 --> 00:15:38,480 Speaker 1: And Katie, most of the people I've spoken with have 278 00:15:38,800 --> 00:15:41,840 Speaker 1: really echoed a similar tone, saying you kind of get 279 00:15:41,840 --> 00:15:44,120 Speaker 1: the best of both worlds. Actually, since we didn't get 280 00:15:44,200 --> 00:15:46,800 Speaker 1: a deal out of the G twenty this past weekend, 281 00:15:46,840 --> 00:15:49,880 Speaker 1: because there's still uncertainty and that could give the Fed 282 00:15:49,920 --> 00:15:52,520 Speaker 1: a little bit more leverage to cut rates before a 283 00:15:52,560 --> 00:15:55,960 Speaker 1: deal could potentially take shape. But Pim, I also want 284 00:15:55,960 --> 00:15:58,600 Speaker 1: to ask you, I know, a big question coming out 285 00:15:58,600 --> 00:16:01,440 Speaker 1: of the first half has been how is it possible 286 00:16:01,480 --> 00:16:04,400 Speaker 1: that we can continue to see bonds rally alongside the 287 00:16:04,440 --> 00:16:08,080 Speaker 1: stock market? How do you try to reconcile things. I mean, 288 00:16:08,120 --> 00:16:10,080 Speaker 1: I'm sorry to make it sound like it's simple, but 289 00:16:10,120 --> 00:16:13,200 Speaker 1: at least to be it's simple. Well, it's very clear 290 00:16:13,280 --> 00:16:14,840 Speaker 1: it has to do with the fact that you have 291 00:16:15,040 --> 00:16:17,360 Speaker 1: so many committed buyers. I mean, if you're running a 292 00:16:17,440 --> 00:16:20,120 Speaker 1: large pension fund, if you're running a municipal pension fund, 293 00:16:20,160 --> 00:16:23,240 Speaker 1: if you're running uh an insurance company, if you're running 294 00:16:23,280 --> 00:16:27,680 Speaker 1: any kind of endowment, anything that has long term liabilities, 295 00:16:28,280 --> 00:16:32,160 Speaker 1: you're not deciding whether you're going to buy your going 296 00:16:32,480 --> 00:16:35,840 Speaker 1: to buy your It's not like, you know, we look 297 00:16:35,880 --> 00:16:38,320 Speaker 1: at it and we compare one asset class to another. 298 00:16:38,560 --> 00:16:42,440 Speaker 1: They're not comparing any asset classes. They're always in there buying. 299 00:16:42,480 --> 00:16:45,640 Speaker 1: They have to buy. And then to the point earlier 300 00:16:45,640 --> 00:16:48,600 Speaker 1: that Katie was making having to do with negative interest 301 00:16:48,680 --> 00:16:51,520 Speaker 1: rates in other parts of the world, if you are 302 00:16:51,680 --> 00:16:54,560 Speaker 1: a let's say European pension plan and you're looking at 303 00:16:54,560 --> 00:16:57,400 Speaker 1: liabilities ten thirty years down the road, what are you 304 00:16:57,400 --> 00:17:00,880 Speaker 1: gonna do. You're gonna buy negative yielding German ones, or 305 00:17:01,080 --> 00:17:03,840 Speaker 1: maybe you're gonna go and you're gonna take one point 306 00:17:03,960 --> 00:17:07,960 Speaker 1: nine five for US treasury ten uere. So I don't 307 00:17:08,000 --> 00:17:10,040 Speaker 1: I don't think that that's necessarily you know, it's not 308 00:17:10,119 --> 00:17:13,640 Speaker 1: either or. And when you look at the returns, let's say, 309 00:17:13,640 --> 00:17:16,400 Speaker 1: of stocks, you know you can there are a lot 310 00:17:16,440 --> 00:17:19,960 Speaker 1: of stocks that you can buy that will produce dividend 311 00:17:20,080 --> 00:17:24,560 Speaker 1: yields that are double what you could get into treasury. Now, 312 00:17:24,640 --> 00:17:27,359 Speaker 1: obviously you got volatility and risk and all, but on 313 00:17:27,400 --> 00:17:31,800 Speaker 1: a relative basis. If you're managing people's money and they say, well, 314 00:17:31,920 --> 00:17:34,679 Speaker 1: you know, great, I can't live on two percent, You're 315 00:17:34,680 --> 00:17:37,400 Speaker 1: gonna have to go find them something else. There's an 316 00:17:37,400 --> 00:17:40,959 Speaker 1: interesting report out I think it's Mike Mayo, who's now 317 00:17:41,000 --> 00:17:43,160 Speaker 1: at well as far Ago, pointing out that the dividend 318 00:17:43,240 --> 00:17:48,280 Speaker 1: you get on banks three the expected dividend anyway after 319 00:17:48,320 --> 00:17:53,280 Speaker 1: the stress test is rivaling utilities at half the pe. 320 00:17:53,480 --> 00:17:55,919 Speaker 1: I mean, pim is are we're gonna see banks, uh 321 00:17:56,080 --> 00:17:58,159 Speaker 1: finally start out performing the market? Do you think? Yeah? Well, 322 00:17:58,160 --> 00:17:59,639 Speaker 1: I mean I wrote up a piece for the m 323 00:17:59,720 --> 00:18:03,240 Speaker 1: Live blog earlier in the month about that having to 324 00:18:03,320 --> 00:18:05,840 Speaker 1: do with buy backs and dividend increases. Now we talk 325 00:18:05,920 --> 00:18:09,359 Speaker 1: about buy backs that are just limited to financial companies, 326 00:18:09,400 --> 00:18:13,280 Speaker 1: and corporations continue to spend what excess cash they have 327 00:18:13,640 --> 00:18:16,440 Speaker 1: on buying back their shares. Of course it makes their 328 00:18:16,440 --> 00:18:20,240 Speaker 1: EPs look good. Uh that also, you know up ceo 329 00:18:20,359 --> 00:18:23,400 Speaker 1: pay because they're measured on what the stock price does. 330 00:18:23,760 --> 00:18:27,359 Speaker 1: But having said that, it doesn't look like anyone's going 331 00:18:27,400 --> 00:18:31,080 Speaker 1: to start cutting dividends, specifically in the financial sector, just 332 00:18:31,119 --> 00:18:33,199 Speaker 1: when they got the green light from the FED and 333 00:18:33,240 --> 00:18:35,440 Speaker 1: those stress tests to go ahead and do it, and 334 00:18:35,520 --> 00:18:37,560 Speaker 1: we know that this is something they've already said they're 335 00:18:37,560 --> 00:18:40,560 Speaker 1: gonna do. And one more post you had that really 336 00:18:40,560 --> 00:18:43,720 Speaker 1: caught my eye. It was about air conditioning in Europe. Well, 337 00:18:44,040 --> 00:18:46,600 Speaker 1: this goes back, This goes back to Sarah's up impending 338 00:18:46,640 --> 00:18:49,320 Speaker 1: trip to Florida. You know, you're not going to Florida 339 00:18:49,359 --> 00:18:53,240 Speaker 1: unless you have air conditioning. And maybe that's something that 340 00:18:53,320 --> 00:18:58,440 Speaker 1: the Europeans will be paying attention to because while Southern 341 00:18:58,440 --> 00:19:01,879 Speaker 1: Europe has a lot of air conditioning, you know, Spain, 342 00:19:02,160 --> 00:19:06,400 Speaker 1: Italy and so on, France and Germany and the Netherlands, 343 00:19:06,520 --> 00:19:10,200 Speaker 1: northern European countries in the UK, typically they do not 344 00:19:10,400 --> 00:19:14,679 Speaker 1: have residential air conditioning. Five percent of France, five percent 345 00:19:14,720 --> 00:19:17,159 Speaker 1: of French homes and under two percent of German homes. 346 00:19:17,359 --> 00:19:20,680 Speaker 1: And I'm not even thinking about offices and trains and 347 00:19:21,359 --> 00:19:24,400 Speaker 1: various public venues. A lot of them do not have 348 00:19:24,560 --> 00:19:29,400 Speaker 1: cooling capacity above ninety degrees fahrenheit. So if it goes 349 00:19:29,440 --> 00:19:32,320 Speaker 1: above ninety degrees fahrenheit and you're a German high speed train. 350 00:19:32,680 --> 00:19:37,280 Speaker 1: Good luck right, and it hit it went over in 351 00:19:37,359 --> 00:19:40,360 Speaker 1: much of the continent. You had a record in France. 352 00:19:40,400 --> 00:19:43,240 Speaker 1: I think it was a hundred and four degrees in France. 353 00:19:43,240 --> 00:19:46,600 Speaker 1: So what are the ways to invest there? You go? See? Well, okay, 354 00:19:46,600 --> 00:19:48,280 Speaker 1: So what I did was I took a look at 355 00:19:48,320 --> 00:19:52,400 Speaker 1: the refrigerants, the actual gases, the industrial gases that go 356 00:19:52,640 --> 00:19:55,959 Speaker 1: into air conditioning systems, because if you're gonna buy an 357 00:19:55,960 --> 00:19:58,399 Speaker 1: air conditioner, they've got to have something to actually cool 358 00:19:58,480 --> 00:20:01,679 Speaker 1: the air. And they're are a variety of rules and 359 00:20:01,720 --> 00:20:04,800 Speaker 1: regulations having to do with hydro fluoral carbons and so on. 360 00:20:05,240 --> 00:20:11,000 Speaker 1: But there there's air liquid, there is um Linda, the 361 00:20:11,240 --> 00:20:15,760 Speaker 1: Industrial Gas company. All of those might benefit because they 362 00:20:15,800 --> 00:20:19,840 Speaker 1: produced the kinds of industrial gases that are compliant with 363 00:20:19,960 --> 00:20:25,600 Speaker 1: the European Union regulations. Interesting stuff again from him, Love 364 00:20:25,680 --> 00:20:28,080 Speaker 1: having here and get your air conditioning in Europe. I 365 00:20:28,080 --> 00:20:31,200 Speaker 1: want to turn the tables really quickly on Mike, because 366 00:20:31,640 --> 00:20:36,120 Speaker 1: back on January fourth, he issued an outlook for the 367 00:20:36,160 --> 00:20:39,359 Speaker 1: Markets Live blog. So I figured it was only fair 368 00:20:39,640 --> 00:20:42,120 Speaker 1: if I pulled out my highlighter and my red pen 369 00:20:42,640 --> 00:20:45,920 Speaker 1: and I granted him and saw where his outlook actually stands, 370 00:20:45,960 --> 00:20:48,880 Speaker 1: and I have to say he did pretty well. Um, 371 00:20:49,359 --> 00:20:51,680 Speaker 1: very equity focus. But I'll run through That's why we're 372 00:20:51,680 --> 00:20:54,280 Speaker 1: talking about it. Right. If this were wrong, he would 373 00:20:54,320 --> 00:20:57,159 Speaker 1: have absolutely shunned me from talking about it on what 374 00:20:57,280 --> 00:21:00,160 Speaker 1: goes up? But here we are talking about it. We'll 375 00:21:00,200 --> 00:21:03,200 Speaker 1: talk about my post saying was the floor for ten 376 00:21:03,280 --> 00:21:06,080 Speaker 1: year yields? That was very wrong, and that came mid June. 377 00:21:07,000 --> 00:21:09,320 Speaker 1: You have a lot of company. I do not know 378 00:21:09,520 --> 00:21:12,560 Speaker 1: one Wall Street strategist who called the bond mark. Oh no. 379 00:21:12,760 --> 00:21:15,720 Speaker 1: But now we have Golden JP Morgan coming out saying 380 00:21:15,720 --> 00:21:19,520 Speaker 1: we could see one point seven five flow forecasts. It's 381 00:21:19,520 --> 00:21:22,159 Speaker 1: pretty fun. Let's go back to how I was right. Right, 382 00:21:22,200 --> 00:21:23,879 Speaker 1: We'll go back to how you're right. I'll start with 383 00:21:23,920 --> 00:21:26,199 Speaker 1: the ones that we're right. How about that? So the 384 00:21:26,240 --> 00:21:28,479 Speaker 1: first one was the consensus is calling for a stronger 385 00:21:28,480 --> 00:21:31,639 Speaker 1: stock market with double digit percentage gains for the SMP 386 00:21:31,680 --> 00:21:34,800 Speaker 1: five hundred in the coming year. Clearly, we are already there, 387 00:21:34,880 --> 00:21:36,920 Speaker 1: double digit gains in the first half of the year, 388 00:21:37,160 --> 00:21:40,600 Speaker 1: there's no doubt about that. Now this one, it's talking 389 00:21:40,720 --> 00:21:44,560 Speaker 1: about the year end target. So he said the average 390 00:21:44,720 --> 00:21:48,400 Speaker 1: estimate from a survey of a hundred seventy markets live readers, 391 00:21:48,400 --> 00:21:51,480 Speaker 1: so not necessarily my himself, but those who feed into 392 00:21:51,520 --> 00:21:54,000 Speaker 1: the Market's live blog. Is for the SMP to close 393 00:21:54,040 --> 00:21:56,920 Speaker 1: the year at nine, that would have been a twelve 394 00:21:56,960 --> 00:21:59,760 Speaker 1: percent gain. So sure, we got a twelve percent gain, 395 00:21:59,800 --> 00:22:02,879 Speaker 1: but we are already way past that. And if you 396 00:22:02,920 --> 00:22:05,760 Speaker 1: compare that to say the SMP ends around three thousand 397 00:22:05,880 --> 00:22:09,640 Speaker 1: or so, that's seven percent above that level. So we're 398 00:22:09,640 --> 00:22:12,119 Speaker 1: already there. We're already there, We're already past. It's a 399 00:22:12,119 --> 00:22:14,720 Speaker 1: long year. Sorry, we could see, we'll see what happens. 400 00:22:14,720 --> 00:22:18,199 Speaker 1: We could always come back down. But my point was 401 00:22:18,560 --> 00:22:21,000 Speaker 1: everybody likes to be a contrarian, you know. Pim and 402 00:22:21,080 --> 00:22:24,160 Speaker 1: I thought, sometimes the consensus gets it right. And that's 403 00:22:24,200 --> 00:22:26,280 Speaker 1: that seemed right to me because at the time, all 404 00:22:26,280 --> 00:22:29,000 Speaker 1: those predictions were made before the market freaked out in 405 00:22:29,040 --> 00:22:32,239 Speaker 1: December and then it looked like they were calling for 406 00:22:32,280 --> 00:22:36,320 Speaker 1: this unrealistic rally. But uh, you get you know, broken clock. 407 00:22:36,760 --> 00:22:38,640 Speaker 1: I'll give you a one more that's right, and that's 408 00:22:38,680 --> 00:22:42,240 Speaker 1: on EPs estimates. So he wrote that bottom up estimates 409 00:22:42,280 --> 00:22:45,320 Speaker 1: show analysts expect earnings per share growth of eight point 410 00:22:45,400 --> 00:22:48,879 Speaker 1: three percent in now that was down from eleven percent 411 00:22:48,960 --> 00:22:51,160 Speaker 1: towards the end of last year, and then he said 412 00:22:51,280 --> 00:22:55,000 Speaker 1: estimates may fall further fall. They absolutely have. Now we're 413 00:22:55,040 --> 00:22:59,120 Speaker 1: expecting four percent earnings growth for the year, and we 414 00:22:59,160 --> 00:23:02,640 Speaker 1: could see that potentially fall even further as well. Um, 415 00:23:02,640 --> 00:23:05,359 Speaker 1: but it's only fair if I also say one that 416 00:23:05,400 --> 00:23:09,920 Speaker 1: you got wrong, Mike, and I think we should go 417 00:23:10,800 --> 00:23:14,000 Speaker 1: with Actually, we'll keep it with earnings. So you said 418 00:23:14,000 --> 00:23:18,320 Speaker 1: that still SMP five hundred companies have a pension to 419 00:23:18,400 --> 00:23:21,359 Speaker 1: consistently beat estimates, which they do. But then you said 420 00:23:21,760 --> 00:23:25,200 Speaker 1: we could potentially even see double digit earnings growth. I'd 421 00:23:25,240 --> 00:23:29,200 Speaker 1: say that's long that's long gone. But overall, i'd give 422 00:23:29,200 --> 00:23:33,080 Speaker 1: you a solid solid you could get a B minus 423 00:23:33,400 --> 00:23:36,640 Speaker 1: I mean B plus, B plus or A minus. Got 424 00:23:36,640 --> 00:23:38,600 Speaker 1: to remember, MYLM, it's amazing how you could be too 425 00:23:38,600 --> 00:23:43,400 Speaker 1: optimistic about the earnings and not optimistic enough about the price. Yeah, well, 426 00:23:43,440 --> 00:23:47,000 Speaker 1: let that one resolved. Sorry, is it that time? It's time? 427 00:23:48,080 --> 00:23:50,920 Speaker 1: It is the time for the craziest thing I ever 428 00:23:51,040 --> 00:23:55,879 Speaker 1: saw in markets this week our weekly ritual on the podcast. 429 00:23:56,080 --> 00:23:58,200 Speaker 1: Did they warn you Katie about this? We weren't you? 430 00:23:58,240 --> 00:24:01,840 Speaker 1: I've been warned. Yes, I'm prepared, Yes I knew Katie comfortably. 431 00:24:02,160 --> 00:24:05,280 Speaker 1: I did my homework, all right, Then you start, what's 432 00:24:05,320 --> 00:24:07,119 Speaker 1: the craziest thing you saw on? Okay, I'm happy I'm 433 00:24:07,160 --> 00:24:10,320 Speaker 1: going first so no one else steals it. But I 434 00:24:10,359 --> 00:24:13,399 Speaker 1: thought the price of tin was really interesting. It plunged 435 00:24:13,480 --> 00:24:17,240 Speaker 1: price of tin. Tin. Okay, So again, I'm a currency 436 00:24:17,400 --> 00:24:20,400 Speaker 1: and bond reporter, not an expert here, but the price 437 00:24:20,440 --> 00:24:23,040 Speaker 1: of tin plunged by the most in seven years this week, 438 00:24:23,520 --> 00:24:28,240 Speaker 1: and I have no idea why, but obviously Bloomberg authors do, 439 00:24:28,480 --> 00:24:32,399 Speaker 1: so this is what they said. The International Tin Association 440 00:24:32,840 --> 00:24:37,040 Speaker 1: blamed the drop in prices on manipulation by institutional investors 441 00:24:37,320 --> 00:24:42,440 Speaker 1: in China's domestic markets. I yeah, so their words, not mine, 442 00:24:42,520 --> 00:24:45,360 Speaker 1: but yeah, check it out. The price of tin plunged 443 00:24:45,400 --> 00:24:48,720 Speaker 1: this week. That's amazing. Pin. Did you have a call 444 00:24:48,840 --> 00:24:51,880 Speaker 1: a market call? And I had no, I had no, 445 00:24:52,000 --> 00:24:55,680 Speaker 1: I had no tin market call. Um. But but I 446 00:24:55,720 --> 00:24:57,760 Speaker 1: would say that the thing that I was taking a 447 00:24:57,760 --> 00:25:00,240 Speaker 1: look at this week had to do with commodo these 448 00:25:00,240 --> 00:25:03,000 Speaker 1: and it has to do with things like cobalt, nickel 449 00:25:03,200 --> 00:25:05,959 Speaker 1: and lithium, right, and this has to do with batteries, 450 00:25:06,040 --> 00:25:07,800 Speaker 1: and then that has to do with Tesla, and we 451 00:25:07,920 --> 00:25:10,159 Speaker 1: got the Tesla results, and they were great and the 452 00:25:10,200 --> 00:25:13,280 Speaker 1: stock went up. But my only point is that if 453 00:25:13,320 --> 00:25:18,639 Speaker 1: we are replacing OPEC as the source of fuel for 454 00:25:18,960 --> 00:25:25,080 Speaker 1: internal combustion engine cars and replacing it with China as 455 00:25:25,160 --> 00:25:28,040 Speaker 1: the really or maybe South Korea you can add into 456 00:25:28,080 --> 00:25:31,520 Speaker 1: but South Korea and China as the two suppliers of 457 00:25:31,600 --> 00:25:36,959 Speaker 1: battery technology, that poses an interesting dynamic in the future, 458 00:25:37,080 --> 00:25:41,120 Speaker 1: doesn't it. Because we've been through the opeque stuff, right, 459 00:25:41,160 --> 00:25:44,320 Speaker 1: I mean, this is, you know, controlling markets, controlling prices, 460 00:25:44,680 --> 00:25:49,560 Speaker 1: and now you're talking about China, which controls about seventy 461 00:25:49,720 --> 00:25:58,440 Speaker 1: percent of the actual UH processed lithium that goes into batteries. 462 00:25:58,440 --> 00:26:02,400 Speaker 1: They don't mind it necessarily all there, but they process 463 00:26:02,520 --> 00:26:05,199 Speaker 1: it and they turn it into batteries and that's what 464 00:26:05,359 --> 00:26:08,199 Speaker 1: runs electric cars. What if they start messing with it 465 00:26:08,280 --> 00:26:11,240 Speaker 1: like they did with the tin according to our there's 466 00:26:11,240 --> 00:26:13,200 Speaker 1: a lot of risks here. There you go, and the 467 00:26:13,240 --> 00:26:17,640 Speaker 1: good news the price of tinfoil hats went down. Everyone 468 00:26:17,720 --> 00:26:21,160 Speaker 1: everyone really sees that as just in time. Sarah, what's 469 00:26:21,160 --> 00:26:23,080 Speaker 1: the craziest thing you saw this week? I'm going to say, 470 00:26:23,080 --> 00:26:25,280 Speaker 1: we're really all going out on a limb today, But 471 00:26:25,680 --> 00:26:29,159 Speaker 1: this headline really caught my eye across the bluebrick terminal. 472 00:26:29,520 --> 00:26:33,480 Speaker 1: It's beyond meat fever turns the tiny P into America's 473 00:26:33,560 --> 00:26:38,280 Speaker 1: hot new crop. So we're actually seeing P prices increase 474 00:26:38,359 --> 00:26:43,400 Speaker 1: because there is such a craze for vegetarianism, veganism and 475 00:26:43,720 --> 00:26:46,520 Speaker 1: beyond meat, burgers, beyond burgers, whatever you make of it, 476 00:26:46,600 --> 00:26:48,600 Speaker 1: and P is the input into that. And I want 477 00:26:48,640 --> 00:26:51,320 Speaker 1: to read you a quote from one of the farmers. 478 00:26:51,320 --> 00:26:56,200 Speaker 1: This farmer said that essentially beyond meats goal of helping 479 00:26:56,240 --> 00:26:58,760 Speaker 1: wean humans off of meat consumption quote unquote does not 480 00:26:58,880 --> 00:27:01,920 Speaker 1: interest me at all. I am a traditional meat guy 481 00:27:02,040 --> 00:27:05,080 Speaker 1: and pro rancher. Then you went on to say about 482 00:27:05,200 --> 00:27:07,520 Speaker 1: the PA, at the beginning, we didn't see it as 483 00:27:07,520 --> 00:27:10,120 Speaker 1: a money maker. It just made the far more sustainable. 484 00:27:10,480 --> 00:27:13,600 Speaker 1: I am excited for new markets for the peas. So 485 00:27:13,960 --> 00:27:15,760 Speaker 1: we'll see what happens with the peace going forwards. But 486 00:27:15,840 --> 00:27:18,359 Speaker 1: beyond meat really helping the price out, can we invest 487 00:27:18,400 --> 00:27:21,440 Speaker 1: in peace? Is there are there futures? I guess so 488 00:27:22,320 --> 00:27:26,520 Speaker 1: maybe in the Princess and the mattress. All right, these 489 00:27:26,520 --> 00:27:28,640 Speaker 1: are all pretty good. I'm gonna I feel like I'm 490 00:27:28,680 --> 00:27:31,280 Speaker 1: cheating with my craziest thing because it's kind of a 491 00:27:31,359 --> 00:27:34,720 Speaker 1: duplicate of last week's crazy thing, but there has been developments. 492 00:27:34,760 --> 00:27:38,159 Speaker 1: Last week, my craziest thing PIM was there's actually an 493 00:27:38,160 --> 00:27:41,520 Speaker 1: exchange where you can buy and sell sneakers. It's called 494 00:27:41,560 --> 00:27:45,040 Speaker 1: stock Ax, and you, you know, buy a pair of 495 00:27:45,119 --> 00:27:47,480 Speaker 1: Nikes for a hundred dollars and you keep them in 496 00:27:47,480 --> 00:27:48,840 Speaker 1: the box for a few years, and then you sell 497 00:27:48,920 --> 00:27:51,680 Speaker 1: them for three of years down the line. That's your 498 00:27:51,720 --> 00:27:55,920 Speaker 1: retirement plan. That's so I'm gonna start a hedge fund 499 00:27:55,960 --> 00:28:00,359 Speaker 1: the sneaker with some Nikes. I have a feeling. So 500 00:28:00,440 --> 00:28:03,720 Speaker 1: this week, Nike released what they thought would be a 501 00:28:03,720 --> 00:28:07,639 Speaker 1: patriotic sneaker with the Betsy Ross flag, you know, the 502 00:28:07,680 --> 00:28:13,600 Speaker 1: thirteen stars um and before they could even get it 503 00:28:13,640 --> 00:28:17,120 Speaker 1: on the market, Uh, Colin Kaepernick, who's one of their 504 00:28:17,480 --> 00:28:20,520 Speaker 1: athletes that they sponsored, said, wait a minute, that thirteen 505 00:28:20,600 --> 00:28:24,720 Speaker 1: star Betsy Ross flag is actually considered offensive to some people. 506 00:28:24,800 --> 00:28:27,479 Speaker 1: Apparently part of the right wing is using that flag 507 00:28:27,600 --> 00:28:32,080 Speaker 1: as a as part of their symbology. I don't really 508 00:28:32,119 --> 00:28:34,720 Speaker 1: get it. I guess it harkens back to the time 509 00:28:34,760 --> 00:28:37,520 Speaker 1: when slavery was still legal. Regardless, Nike said, all right, 510 00:28:37,520 --> 00:28:40,120 Speaker 1: that's a bad idea. To release this shoe back to 511 00:28:40,200 --> 00:28:43,560 Speaker 1: stock X. A few pairs trickled out. I think like 512 00:28:43,960 --> 00:28:47,600 Speaker 1: sixty seven pairs of this sneaker traded on stock X, 513 00:28:48,360 --> 00:28:52,080 Speaker 1: going for as high as twenty dollars. A pair of 514 00:28:52,120 --> 00:29:00,720 Speaker 1: these sneakers that come with or without laces five hundred dollars, 515 00:29:00,760 --> 00:29:04,560 Speaker 1: I would hope. So people will do anything nowadays for 516 00:29:04,600 --> 00:29:08,160 Speaker 1: limited edition sneakers. I would say. Now, we also have 517 00:29:08,280 --> 00:29:10,360 Speaker 1: one from Twitter that we have to bring to the 518 00:29:10,360 --> 00:29:13,160 Speaker 1: podcast that we picked out. This came from at thirty 519 00:29:13,240 --> 00:29:17,880 Speaker 1: seven Techno Shaman. Now he said he was watching the 520 00:29:18,720 --> 00:29:23,120 Speaker 1: gold dollar pair quote unquote too fast, too soon, wasn't 521 00:29:23,200 --> 00:29:26,640 Speaker 1: the case? It went further up against all odds, considering 522 00:29:26,640 --> 00:29:29,520 Speaker 1: the correction right after G twenty talks. I bet some 523 00:29:29,600 --> 00:29:34,000 Speaker 1: bears got caught unprepared. Now this goes to thinking, sure, 524 00:29:34,200 --> 00:29:38,080 Speaker 1: we saw another rally in gold, we're back above four ounce, 525 00:29:38,160 --> 00:29:41,960 Speaker 1: But does the rally and gold seems sustainable at this 526 00:29:41,960 --> 00:29:45,320 Speaker 1: point in time? Oh gosh, I mean, I have no idea. 527 00:29:45,960 --> 00:29:49,880 Speaker 1: All I can say is that if you hold a 528 00:29:49,960 --> 00:29:54,200 Speaker 1: gold coin like a double Legal or a Kreugeran in 529 00:29:54,280 --> 00:29:59,520 Speaker 1: your hand, you will understand how it makes you feel, 530 00:30:00,160 --> 00:30:04,800 Speaker 1: rather than what it is sort of symbolically, and I 531 00:30:04,840 --> 00:30:09,200 Speaker 1: think that many gold investors looked to that as the 532 00:30:09,560 --> 00:30:14,520 Speaker 1: sort of inception of their interest in gold and what 533 00:30:14,720 --> 00:30:17,640 Speaker 1: we've seen, for example, the Central Bank of China adding 534 00:30:17,640 --> 00:30:21,400 Speaker 1: to their gold reserves. And if you believe that paper 535 00:30:21,400 --> 00:30:25,560 Speaker 1: currencies are being debased, gold is certainly an option. I 536 00:30:25,600 --> 00:30:29,920 Speaker 1: would say, announce a goal still costs about a grand grand, 537 00:30:30,040 --> 00:30:34,080 Speaker 1: less than a pair of Airmas one Nikes, so and 538 00:30:34,120 --> 00:30:38,120 Speaker 1: you can't wear the gold so nice. Try Twitter guy, 539 00:30:38,120 --> 00:30:40,520 Speaker 1: but I think I think the Twitter guy Mike's can 540 00:30:40,600 --> 00:30:43,920 Speaker 1: refer to everyone who now offers up their brilliant ideas 541 00:30:43,920 --> 00:30:46,960 Speaker 1: on Twitter as Twitter guy. Although it's it's declare winner. 542 00:30:46,960 --> 00:30:50,120 Speaker 1: I think Katie wins with the tin price manipulation. I 543 00:30:50,440 --> 00:30:52,720 Speaker 1: totally missed that one. Usually I'm aware of these crazy 544 00:30:52,720 --> 00:30:54,880 Speaker 1: market stories. I wasn't aware that there was a winner. 545 00:30:55,400 --> 00:30:56,920 Speaker 1: I think this is the first week we got a winner, 546 00:30:56,960 --> 00:30:58,840 Speaker 1: so you should be really get excited. I don't think 547 00:30:58,840 --> 00:31:03,440 Speaker 1: you get the sneaker. Maybe a tin hat, though I 548 00:31:03,440 --> 00:31:07,240 Speaker 1: think that's another tin hat. Katie Grindfeld, though pimp Box, 549 00:31:07,320 --> 00:31:16,320 Speaker 1: thank you so much for joining the podcast today. What 550 00:31:16,480 --> 00:31:19,160 Speaker 1: goes Up? We'll be back next week until then you 551 00:31:19,200 --> 00:31:21,800 Speaker 1: can find us on the Bloomberg Terminal, website and app, 552 00:31:21,880 --> 00:31:24,600 Speaker 1: or wherever you get your podcasts. We'd love it if 553 00:31:24,600 --> 00:31:26,640 Speaker 1: you took the time to rate and review the show 554 00:31:26,680 --> 00:31:29,959 Speaker 1: on Apple podcast so more listeners can find us. And 555 00:31:30,040 --> 00:31:32,960 Speaker 1: you can also find us on Twitter. Follow me at 556 00:31:33,360 --> 00:31:37,400 Speaker 1: Sarah Ponzack, Mike is at Rea Anonymous, Our guest Pimp 557 00:31:37,440 --> 00:31:40,920 Speaker 1: Fox is at pim Fox, and Katie Greidfeld is at 558 00:31:41,000 --> 00:31:45,320 Speaker 1: k Greifeld. You can also follow Bloomberg Podcasts at podcasts. 559 00:31:45,800 --> 00:31:48,440 Speaker 1: What Goes Up is produced by Toprah Foreheads. The head 560 00:31:48,480 --> 00:31:52,080 Speaker 1: of Bloomberg Podcasts is francesco Leavie. Thanks for listening, See 561 00:31:52,080 --> 00:32:02,560 Speaker 1: you next time. Four