Speaker 1: Strap on your parachute. Is time for What Goes Up
Speaker 1: with Sarah Ponzick and Mike Reagan. Hello and welcome to
Speaker 1: What goes Up, a Bloomberg Weekly Markets podcast. I'm Sara Ponze,
Speaker 1: reporter on the Cross Asset team, and I'm Mike Reagan,
Speaker 1: a senior editor at Bloomberg and not the Mike Reagan
Speaker 1: who is just nominated to leave the e p A,
Speaker 1: the Environmental Production Agency. I will point out, did you
Speaker 1: actually get Twitter followers after the announcement night? After Wisenthal
Speaker 1: congratulated me for the new job As a joke, I
Speaker 1: I got about thirty new Twitter followers, So hopefully they'll
Speaker 1: stick around for the dad jokes and market commentary. Even
Speaker 1: though I don't have a lot to offer on the environment.
Speaker 1: I'm a fan of the environment. I'm just not the
Speaker 1: guy in charge of it, so we'll leave it at that.
Speaker 1: That's hysterical. That's hysterical. And for anyone who's not aware Wisenthal,
Speaker 1: that's Joe Wisenthal. He's the host of the Odd Lots
Speaker 1: podcas as step Bloombergigat does plenty of other things as
Speaker 1: well here, but if you haven't checked out the Odd
Speaker 1: Lads podcast please do. You can find it pretty much
Speaker 1: anywhere you get your podcasts. But this week on the show,
Speaker 1: the US dollar continues its decline as the M S
Speaker 1: c I All Country, World and Next trades a record highs.
Speaker 1: In addition to that, emerging market equities are on pace
Speaker 1: for their best quarter versus U S docks since two
Speaker 1: thousand and nine. Well, the momentum continue through next year
Speaker 1: and beyond. We get the state of play on international assets,
Speaker 1: and as always, will close out the episode with our
Speaker 1: tradition the craziest Thing I saw in markets this week, Sarah,
Speaker 1: I've got a contribution from none other than our Crazy
Speaker 1: Things correspondent Vildonna Hirich, who said to me, I'm not
Speaker 1: telling sorry about this one. I'm giving it right to you,
Speaker 1: So I don't know how you feel about that. Well,
Speaker 1: she didn't even tell me that she was going to
Speaker 1: do a roundabout and come to you. I had no
Speaker 1: idea this was coming. But I will say we also
Speaker 1: have a trifecta of guests rite ins. We have a voicemail.
Speaker 1: I got a ib which for those who do not
Speaker 1: have a Bloomberg terminal, it's like instant message. It's your
Speaker 1: instant Bloomberg. And then I also got a direct message
Speaker 1: on Twitter. So we've got plenty of crazy things. Thank
Speaker 1: thank goodness for that. Right, But let's first start with
Speaker 1: that market talk that we know you all came for.
Speaker 1: And uh happy to have a new guest this week
Speaker 1: on the show. He runs the International and Global Mutual
Speaker 1: Fund and EATF business at Davis Selected Advisors. His name
Speaker 1: is Danton, Go Eat Dance and welcome to the show.
Speaker 1: Thanks so much Mike for having me on on board.
Speaker 1: Very excited. Oh great, you know and Ted. And before
Speaker 1: we start talking about markets, I gotta say we get
Speaker 1: notes about the guests from you know, the PR people
Speaker 1: that you guys work with, our our good friend Tyler Bradford.
Speaker 1: In this case, I gotta ask you first about something
Speaker 1: he pointed out, which I think I think is fascinating. Says,
Speaker 1: every summer, Danton travels to a new international destination to
Speaker 1: live with his family until school starts back up. That's
Speaker 1: fascinating to me. For one thing, I'm glad my kids
Speaker 1: don't listen to the podcast because I don't want them
Speaker 1: to know that's an option for summer summer the kids.
Speaker 1: But I think that's a really cool tradition. Is that
Speaker 1: just for fun or is that as sort of uh
Speaker 1: an international equity specialist. Is it part of your research?
Speaker 1: You know? And and you don't have to tell me
Speaker 1: what you're expensing on your expense account or not. But
Speaker 1: I'm curious if it's if it ties into your work
Speaker 1: or if it's just for fun. Yeah. No, happy to
Speaker 1: talk to them, like to your kids about this, but
Speaker 1: he's he's gonna block you. It is absolutely part of
Speaker 1: our research process to go visit companies, you know, in
Speaker 1: their home markets, in their offices and talk to the companies,
Speaker 1: talk to the competitors or suppliers or customers. And since
Speaker 1: we are a global fund, those companies are around the globe,
Speaker 1: you know where our team is based here in New York,
Speaker 1: meaning that we travel a lot. But this is a
Speaker 1: way to really spend instead of you know, a week
Speaker 1: or two on the ground in the country, to spend
Speaker 1: two or three months. And so for the last dozen
Speaker 1: years we've been doing this with my wife, with the
Speaker 1: three kids, and we alternate between Asia one one year
Speaker 1: and Europe the other year. You know, I grew up
Speaker 1: in France and I was born in Germany, so you know,
Speaker 1: Europe and in some senses my home, but my family
Speaker 1: is in Adonesian Chinese, and I speak Mandarin, so I
Speaker 1: feel comfortable in Asia as well. So both places have
Speaker 1: a lot of contacts, and then the last dozen years
Speaker 1: have been able to build that network. So it's been
Speaker 1: a really fantastic way to kind of build a network
Speaker 1: over time and visit these companies and a lot of
Speaker 1: the companies that we own in the portfolio. So yeah,
Speaker 1: I would highly recommend it. So really quickly before we
Speaker 1: get to the market's talk, I have to ask them,
Speaker 1: do you have a favorite country or a favorite place
Speaker 1: that you you've ever lived? You know, I think right
Speaker 1: now one of the most exciting markets to be obviously,
Speaker 1: you know, it's sort of an asterisk is an unusual year,
Speaker 1: but has been China over the last few decades to watch,
Speaker 1: you know, the first time I went to China was
Speaker 1: nine and it was a totally different country and market
Speaker 1: than it is today. But be able to see the
Speaker 1: last three decades of evolution over there has been really fascinating.
Speaker 1: But of course I have a soft part in my
Speaker 1: heart for France. That's where I grew up, That's where
Speaker 1: all my high school friends are, so it is always
Speaker 1: nice to go back home. It's where my mother. My
Speaker 1: mother still lives there, so um it is nice to
Speaker 1: go home there as well. And of course the quality
Speaker 1: of life can't be beat over there and much more
Speaker 1: comfortable than China. It's a great tradition and your kids
Speaker 1: must really benefit from the education value of it. To
Speaker 1: uh Sarah I, I once was able to get a
Speaker 1: week in Jamaica to report about the stock exchange there,
Speaker 1: but Denton's got me beat hands down. I think this
Speaker 1: this is kids because my kids go to Chinese summer
Speaker 1: camp with the locals in China or Taiwan or Hong Kong,
Speaker 1: depending on where we are, and then they go to
Speaker 1: summer camp a French summer camp in France with the
Speaker 1: locals as well. You know, they've been kind of thrown
Speaker 1: in the deep end at an early age. That's that's
Speaker 1: great though. Well, one thing I wanted to ask you,
Speaker 1: let's let's dive into the markets now, and um, I
Speaker 1: was looking at the holdings of the Global Fund at
Speaker 1: Davis done very well, very very strong percentile performance, and
Speaker 1: correct me some of these numbers might be outdated. You know,
Speaker 1: we're we're working off of whatever the most recent filings was,
Speaker 1: but about of the global fund allocated to the US
Speaker 1: at least of the last reporting we have for it.
Speaker 1: And here we are as the year sort of closes
Speaker 1: out here, and I think a big theme I keep
Speaker 1: hearing from investors is that everyone's looking outside of the
Speaker 1: US for one, thinking that it's kind of time for international,
Speaker 1: for emerging markets to shine. Is that up your rethinking
Speaker 1: a big allocation to the US at all, or or
Speaker 1: you just you know, sticking with what's worked so far
Speaker 1: and and not worrying about sort of the the consensus
Speaker 1: and the zeitgeist out there with with what everyone's talking
Speaker 1: about rotating to international. Yeah, I mean, I think people
Speaker 1: for good reason are looking internationally. They have kind of
Speaker 1: said that, I think the last two or three years.
Speaker 1: But the US market is sort of is powered through anyways,
Speaker 1: but there is a good reason to look abroad. Right now.
Speaker 1: Evaluations are about lower international markets on average than the
Speaker 1: US market, So that's already a great starting point. And
Speaker 1: we know that the last decade the US market has
Speaker 1: been very strong. But these things go in cycles, so
Speaker 1: it's very possible in the next decade, you know, international
Speaker 1: markets do as well. If not better than US markets,
Speaker 1: but you know, we run a very focused portfolio of
Speaker 1: uh thirty five forty sort of best of breed companies.
Speaker 1: So when we're looking at the US market, we're not
Speaker 1: really investing in the overall market. We have a very
Speaker 1: concentrated and focused view of companies that we want to own,
Speaker 1: and we're finding, you know, very good opportunities there too.
Speaker 1: But we would say there's a lot of you know,
Speaker 1: froth also in the US market that you want to avoid,
Speaker 1: but underneath that there are some very good values for sure.
Speaker 1: You know, some companies that have done well recently are
Speaker 1: still relatively attractive. I would say we call them sort
Speaker 1: of the growth stalwarts, the sort of the Googles, the
Speaker 1: Facebooks of the world. You know, they continue to be
Speaker 1: attractive on evaluation basis, on long term basis. But then
Speaker 1: you've got a whole host of stocks that have been
Speaker 1: out of favor now for a decade plus, right the
Speaker 1: value stocks out there, and specifically we're thinking about the
Speaker 1: financials and the banks that have been really out of favor,
Speaker 1: you know, basically since the financial crisis and no. Eight
Speaker 1: oh nine, so that was a long time ago, that
Speaker 1: are trading at really low valuation. In fact, when you
Speaker 1: look at the difference between the Russell one thousand growth
Speaker 1: versus the Russell one thousand value performance, it's amazing. It's
Speaker 1: a record gap and difference. So I think, you know,
Speaker 1: owning the market overall in the US probably not recommended,
Speaker 1: but within that space some great values. Let's come back
Speaker 1: to something that you just walked us through. You mentioned
Speaker 1: the word froth that at the same time explained how
Speaker 1: there's growth stalwarts and just because you're a company that's
Speaker 1: performed very very well over the last year, over the
Speaker 1: last decade, it doesn't necessarily mean that your time is over.
Speaker 1: Can you give us a sense of where you do
Speaker 1: see the froth, the areas where you see risk or
Speaker 1: that you would avoid uh, and then maybe bring us
Speaker 1: through some of the misconceptions that there are. Yeah, I mean,
Speaker 1: there are a lot of companies that have done great
Speaker 1: in the past few years, and specifically in that have
Speaker 1: you know, up three, four or five, six times maybe
Speaker 1: even this year. But where the valuations in our mind
Speaker 1: and we're you know, we're value investors, don't make much sense.
Speaker 1: And they're great companies, they make great products, and I'm thinking,
Speaker 1: you know, specifically of a company like Tesla, which has
Speaker 1: done great, right, I mean, i'll test of shareholders have
Speaker 1: been very happy. But when we look at it and
Speaker 1: you know, and see that they manufacture something cars and
Speaker 1: have a over six billion market cap, and then you
Speaker 1: look at General Motors that manufactures seven point seven million
Speaker 1: vehicles and has a sixty billion you know, so one
Speaker 1: of the market cap, you know, one of those two
Speaker 1: things is probably wrong there in terms of how the
Speaker 1: numbers will play out over time. You know, we don't
Speaker 1: own some of these stalks, and they've done great, so
Speaker 1: kudos to whoever owns them, but we would say, just
Speaker 1: on evaluation basis, there's quite a bit of froth in
Speaker 1: some of these. You know, there's just momentum in some
Speaker 1: parts of the market. You know, it's in looking at
Speaker 1: some of the top holdings across a few of the
Speaker 1: funds of Davis, A lot of the big sort of
Speaker 1: market dominating firms in their industries are are pretty heavily
Speaker 1: weighted out Ali Baba and China, Amazon, Alphabet, Facebook here
Speaker 1: in the US, and at the same time, there's this
Speaker 1: big buzz about the anti trust issue, not only in
Speaker 1: the US but in China. You know, ten cent in
Speaker 1: Ali Baba recently getting fined because of some of their
Speaker 1: mergers in the past. I'm curious how you're thinking about
Speaker 1: that issue anti trust. Is it necessarily a scary thing
Speaker 1: to be threatened with an anti trust probe? Yeah, it's certainly,
Speaker 1: um something that's in the news, that's been you know,
Speaker 1: growing as an issue over the last four or five years.
Speaker 1: You know, one that some of these companies like Google
Speaker 1: has been dealing with actually for a while now. I
Speaker 1: in fact, they have been under investigation and dealing with
Speaker 1: sort of fines and remedies in the European Union for
Speaker 1: five years now already, and they've been operating under that.
Speaker 1: And actually, I mean that's a good case where despite
Speaker 1: all of that and a very strict and aggressive antitrust policy,
Speaker 1: they have actually done five and in Europe the market
Speaker 1: share is actually even stronger than in the US, and
Speaker 1: it's well over search market share, and their results have
Speaker 1: been very strong. So they've been able to adapt and
Speaker 1: operate well despite you know, despite that. I mean, in
Speaker 1: some ways, of course, it's a little bit of a
Speaker 1: badge of honor in the sense that you've become so big,
Speaker 1: so successful people will have become very worried about you.
Speaker 1: And it does make sense as a society that we
Speaker 1: are concerned about these you know, these these huge companies
Speaker 1: and they should be regulated. And so the regulators are
Speaker 1: definitely playing a little bit of catch up here. But
Speaker 1: in terms of an investor, you have to really think about, Okay,
Speaker 1: what you know, what has happened in the past. You know,
Speaker 1: it's been relatively benign. What are the possible risks And
Speaker 1: like you said, Mike, I mean that would be a
Speaker 1: draconian measure. We haven't really seen that happen before. Very
Speaker 1: often is sort of the breakup in sort of a
Speaker 1: you know, the d merger of companies that have been
Speaker 1: merged for several years. But even if that does happen,
Speaker 1: it doesn't mean like this business is being nationalized and confiscated. Right.
Speaker 1: And then China it's interesting. I mean, they've actually had
Speaker 1: a much laxer antitrust policy than even the US, so
Speaker 1: in some ways they've been sort of more capitalistic than
Speaker 1: even than the US, but now they're realizing that they
Speaker 1: need to Also, you know that some part some behaviors
Speaker 1: are gotten too extreme. You know, online retailers are forcing
Speaker 1: brands to choose one of the platforms. You know, that's
Speaker 1: probably not great for consumers, right that raises prices and
Speaker 1: reduce the selection they are intervening, And it does make sense.
Speaker 1: Antitrust concerns is a quasi badge of honor. That's a
Speaker 1: different way to look at it. I wanted to ask you,
Speaker 1: danton Um, say you are a a U S investor,
Speaker 1: and odds are you maybe have a home bias and
Speaker 1: you have a very very large allocation to the US.
Speaker 1: We talked about how maybe it's a good time to
Speaker 1: start allocating internationally, but can you walk us through certain areas,
Speaker 1: certain countries, certain regions that that you think are right
Speaker 1: for growth right now and maybe it would make a
Speaker 1: good investment at this point in time. Yeah, So I
Speaker 1: think when you go internationally you have to be extremely selective.
Speaker 1: You know, in our funds we really limit the number
Speaker 1: of countries that were invested in. You know, there's uh,
Speaker 1: for example, twenty six emerging markets. We're really only in
Speaker 1: s or three or four of them. And that's because
Speaker 1: you know, the concerns around economic growth, political stability, sort
Speaker 1: of market access, things like that are important things that
Speaker 1: you maybe worry a little less in the US. You
Speaker 1: have to pay a lot more attention to when you're
Speaker 1: looking at international markets. So when we when we look
Speaker 1: through that and see which markets we think look really interesting,
Speaker 1: you know, China continue to look interesting. It's had, i
Speaker 1: guess overall a pretty good year, but it's still under
Speaker 1: somewhat cloud. You know, you definitely still heal here. Sorry,
Speaker 1: rumblings of the US China geobolitical strain out their intention
Speaker 1: and that's not going away even if there's a change
Speaker 1: in administration happening right now. So that's definitely true. But
Speaker 1: the conditions over there for economic growth are still quite strong.
Speaker 1: I mean, in fact, this year, China is going to
Speaker 1: be there probably the only large economy that's going to grow.
Speaker 1: They're looking at sort of a two percent we know,
Speaker 1: which is still not heroic, but you know, with with
Speaker 1: what happened with COVID in the pandemic, that's still pretty
Speaker 1: strong two percent growth, whereas most countries, including the US,
Speaker 1: we're probably gonna you know where we're in the middle
Speaker 1: of a recession and the next year expectations are sort
Speaker 1: of seven eight percent growth, so obviously pretty strong rebound
Speaker 1: off of a slow year. You know, Increasingly the companies
Speaker 1: there because of course, you're not investing in the country
Speaker 1: or the market. You're investing individual companies. The management teams,
Speaker 1: you know, keep on getting better and better, really high
Speaker 1: quality entrepreneurial managed teams. And then the quality of the
Speaker 1: companies do you have some leading to all of these
Speaker 1: there If you think about you know who the top
Speaker 1: six cloud computing companies out there, of course you think
Speaker 1: of you know, Amazon and Microsoft and Google, but the
Speaker 1: fourth largest is now a Chinese company to Ali Baba.
Speaker 1: Outside of China, I think Southeast Asia also looks pretty attractive.
Speaker 1: I mean, it's a conglomeration of sort of six or
Speaker 1: seven countries, but together you have about a population around
Speaker 1: six hundred million people, so that's almost half the size
Speaker 1: of China, for example, so a very large market together.
Speaker 1: That is, the democraptics are favorable where the economic growth
Speaker 1: is strong. So I think that's a pretty interesting area
Speaker 1: to to look at. You know, then, uh, Latin America
Speaker 1: I think long term also would be interesting. It's pretty fascinating.
Speaker 1: Uh debts and to talk to a guy like you
Speaker 1: who has um sort of discretion to to invest anywhere
Speaker 1: in the world basically, uh, for for at least a
Speaker 1: few of these funds, and I'm just you know, it's
Speaker 1: such a huge universe of stocks out there around the world.
Speaker 1: I'm curious how your process works, you know, how do
Speaker 1: you start narrowing down that massive universe of stocks around
Speaker 1: the world. Is it sort of country by country like
Speaker 1: you were just saying, do you try to go by
Speaker 1: GDP growth? Is it a you know, run a screen
Speaker 1: of evaluations. What's what's the process like to hunt for
Speaker 1: that next by You're absolutely right, Like, you know, there's
Speaker 1: about three thousand companies in the Global Index. That's a
Speaker 1: huge amount of companies to follow and stay on top
Speaker 1: of and be familiar with. And of course in that
Speaker 1: there's lots of companies that you would never want to
Speaker 1: invest in, you know, state own enterprises, these old industrials
Speaker 1: and telecoms and utility companies or stay owned banks in general.
Speaker 1: We're gonna avoid already that big part of the market
Speaker 1: because they're not really run for shareholders, they have other
Speaker 1: interest at heart. But we really kind of focus on
Speaker 1: at the industry level, right, and so we're trying to
Speaker 1: understand whether it's consumer or industrials or sort of technology.
Speaker 1: Where are the great companies, where are you know, innovation.
Speaker 1: Where are the great brands anywhere in the world, and
Speaker 1: then so the world we'll follow that lead. With that said, Mike,
Speaker 1: I'm pretty sure it's that time. It is that time.
Speaker 1: Stand clear of the craziest things we saw in markets
Speaker 1: this week. Sir, why don't you get it started. You
Speaker 1: have a bunch of contributions from the voice. Oh, we
Speaker 1: have a voicemail. Let's play that. Hi, this is Tim.
Speaker 1: President Obama's high school basketball jersey got auctioned off for
Speaker 1: a hundred and ninety two thousand dollars. This is more
Speaker 1: than what Michael Jordan's was, Fred seventy three thousand. End
Speaker 1: of broad James was we're like a eighty five or
Speaker 1: something thousands. So President Obama's of high school jersey for
Speaker 1: thousand was the most expensive high school basketball jersey that
Speaker 1: has ever been auctioned. Always great to get a voicemail,
Speaker 1: every one. Remember if you want to give us a call,
Speaker 1: that number is six four six three two four three
Speaker 1: four nine zero. And just as you heard, we may
Speaker 1: even play your message on the show. But not only
Speaker 1: did we get a voicemail, as I said earlier, we
Speaker 1: also got other writings too. So first I'll read this one.
Speaker 1: This came through on the Bloomberg terminal from Stephen Kaminski
Speaker 1: of Jump Systems. Uh So, this is what he said.
Speaker 1: He said, we all already know one of the craziest
Speaker 1: moments in this crazy year was oil going negative in April.
Speaker 1: Perhaps even crazier, though, is nine traders at Vega Capital,
Speaker 1: whereas a group the biggest sellers of w t I
Speaker 1: futures and spreads. On that day they made six hundred
Speaker 1: sixty million dollars. Even the son of one of the
Speaker 1: Vega traders, who's in his early twenties with limited experience,
Speaker 1: made eight million all caps. Wild story, and I do
Speaker 1: encourage this is a great story. One of the reporters
Speaker 1: on this was Liam Vaughan. We had him as a
Speaker 1: guest on one of our prior podcasts. He's a great,
Speaker 1: great storyteller. Um So, I encourage you to go read it,
Speaker 1: and then uh I'll read the other one as well.
Speaker 1: This one came through on Twitter from at Term Management.
Speaker 1: He said, the craziest thing in markets this week full disclosure.
Speaker 1: He wrote this at the end of last week two,
Speaker 1: but didn't quite make it in because we had already
Speaker 1: recorded the podcast. He said, airb nb I p O
Speaker 1: getting plenty of attention for performance in early trading. Meanwhile,
Speaker 1: pebble Brook Hotel Trust, this is peb The ticker is
Speaker 1: priced four fifty million dollars of six year paper at
Speaker 1: one point seven five. And then you went on to
Speaker 1: explain you may be familiar, but the hotel reads carry
Speaker 1: basically all the operational leverage, and the operators don't actually
Speaker 1: have much downside exposure. Current hotel occupancy is in the
Speaker 1: upper thirties. Uh And then he went on, he goes
Speaker 1: and yet creditors underwriting a yield of less than two percent,
Speaker 1: limitless investor appetite for anything related to the quote unquote
Speaker 1: reopening trade. And it really is remarkable, Mike, it really is.
Speaker 1: That's I believe that's froth with a capital F right
Speaker 1: there for that mistake. But I'm curious what you think.
Speaker 1: You know, we've seen some really popping uh I p
Speaker 1: O debuts in the last week or so. You guys
Speaker 1: seem focused mainly on the more mature companies. How you
Speaker 1: know big of an IPO? How how attractive does an
Speaker 1: IPO have to be to sort of catch your attention
Speaker 1: or do you like to wait and see that the
Speaker 1: company's lasted a few years before you get involved. Yeah,
Speaker 1: I mean it depends. Um. You know, some of these
Speaker 1: I p O companies actually have been uh, you know,
Speaker 1: large companies operating at scale for many years. That might
Speaker 1: not have been the case years ago, because when you're
Speaker 1: that large, you know you've already come public. But now
Speaker 1: with the strength of the private markets, uh, these companies
Speaker 1: have not had too uh. And then you know there's
Speaker 1: other reasons. You know, the star bans Aukleys and things
Speaker 1: that like that have just sort of dissuaded people from
Speaker 1: from from coming public. And then the focus on quarterly
Speaker 1: earnings is sort of a turn off as well, So
Speaker 1: there's been good reasons why they stayed private. You see
Speaker 1: some of these companies coming out and they're actually relatively sure.
Speaker 1: We're very valuation sensitive and so we'll look at some
Speaker 1: of these and if it makes sense, participate, But in general,
Speaker 1: we're really mostly focused on the publicly traded companies out there. Interesting. Interesting, alright,
Speaker 1: n before we put you on the spot for your
Speaker 1: crazy thing, I'll give you mine via vill Donna, high
Speaker 1: rich and very high expectation. It's a good one because
Speaker 1: it will allow us to play little prices right here
Speaker 1: on on what this is. Obviously it's an alternative asset.
Speaker 1: As you know, is um u inclined to delve into auction.
Speaker 1: In in UH London by Christie's, the first commercially printed
Speaker 1: Christmas card is up for sale. It's a merry Victorian
Speaker 1: era scene that scandalized some who denounced it as humbug
Speaker 1: when it first appeared in eighteen forty three, and that
Speaker 1: that great lead is courtesy of the Associated Press. Uh.
Speaker 1: So it was controversial because it's a picture of a
Speaker 1: family having a big, happy Christmas meal, but they're all
Speaker 1: drinking wine and there's even someone offering some wine to
Speaker 1: a young toddler at the table. So I think the
Speaker 1: the temperance movement in UH in England in the in
Speaker 1: the late eighteen hundreds was not very happy about this.
Speaker 1: So so it was very controversial. They say only a
Speaker 1: thousand were printed first commercial Christmas card a thousand printed,
Speaker 1: Only about thirty left started knowing what you know about
Speaker 1: the alternative assets space? Uh, what's your what's your price
Speaker 1: on this? Because you know I'm a professional now an
Speaker 1: alternative asset, that's right. I think the common thread with
Speaker 1: these prices rights has really been that. Typically they cost
Speaker 1: much less than we're inclined to guess. So I'm gonna
Speaker 1: I'm gonna low ball it, uh, and I'm going to
Speaker 1: go I'm gonna go six d dollars, six hundred dollars. Okay,
Speaker 1: what a scrooge? Cheez, six hundred dollars, Denton, how much
Speaker 1: are you willing to bid for the first commercially available
Speaker 1: Christmas card from forty I believe it is. I know,
Speaker 1: I think I just saw that, like um, Gretzky's rookie
Speaker 1: card went for a million dollars. That was actually that
Speaker 1: was going to be my personal if we needed it. Uh,
Speaker 1: you know, maybe not Gretzky levels, but certainly more than six.
Speaker 1: Come on, Sarah, every look, every time we play prices, right,
Speaker 1: I guess something ridiculous like two hundred thousand dollars five
Speaker 1: million dollars, and everything is typically way below what I guess.
Speaker 1: So the wise move here, Denton is for you to
Speaker 1: bid six or one. That's what I would That's what
Speaker 1: I would do. I know I've watched I'll put you
Speaker 1: down for six. So I watched a lot of prices
Speaker 1: right in my childhood, and I would I would go
Speaker 1: six so one exactly alright, So it hasn't sold yet,
Speaker 1: it's up for sale. I' leave this uh this weekend. Uh,
Speaker 1: there's thinking between five hundred and eight hundred pounds, so
Speaker 1: between about sixty seven hundred and eleven thousand dollars um.
Speaker 1: Always seems a little low to me for the first
Speaker 1: Christmas card. I don't know. Okay, So I was I
Speaker 1: was right in the right range you were, Yeah, the
Speaker 1: low ball bid was that was smart. I was expecting
Speaker 1: a six figure bid from you, Sarah. So it's good.
Speaker 1: Good to see you've got a little price discipline and you. Uh,
Speaker 1: I've learned to tamp down my expectation, right, even though
Speaker 1: Sarah did just buy a Peloton so I, uh, she's
Speaker 1: she's feeling the froth. I think she's feeling. I'm going
Speaker 1: to say it out right from my perspective, maybe one
Speaker 1: of my best practices of twenty twenty. Yeah, yeah, I
Speaker 1: mean yeah, I got it on Monday and I've already
Speaker 1: used it a couple of times. So have you gotten
Speaker 1: have you gotten any shoutouts from the instructors? I I
Speaker 1: feel like you're not really a pelts On rider and
Speaker 1: sold they one of those people in the like Cris
Speaker 1: shout you out in the middle of her. I haven't
Speaker 1: done any of the live rides yet, but I'm planning
Speaker 1: to on Sunday, so I'll let you know. I'll let
Speaker 1: you know if I happen to get a shout out. Alright, alright,
Speaker 1: interesting now, dads, And I'm not sure if they warned
Speaker 1: you about this gimmick, But have you have you seen
Speaker 1: anything crazy in markets this week? You can tell us about. Yeah,
Speaker 1: you know, I think there are plenty things, you know,
Speaker 1: one of the most amazing things that I've that I've seen, um,
Speaker 1: you know, and of course Bitcoin has been a lot
Speaker 1: in the news, and of course it's hitting records right
Speaker 1: triple this year or more than that, it's twenty three
Speaker 1: thousand UM. So recently somebody launched a crypto index fund.
Speaker 1: You know. This is the bit Wise ten crypto index fund.
Speaker 1: It's the so the top ten cryptocurrencies out there, uh,
Speaker 1: you know, an index fun of that UM and so
Speaker 1: the NYV of that per share is eighteen dollars and
Speaker 1: fifty cents. Guess what the price per share? And these
Speaker 1: are just you know, basically bitcoins and some other ether
Speaker 1: and some other currencies in there, just what the price
Speaker 1: of that uh per share is nine? I'm gonna upstand
Speaker 1: because I because I read this. I had to, you know,
Speaker 1: I had to. So in preparation for this, I looked
Speaker 1: at the data and I had to call my financials
Speaker 1: analysts last night and say, can you turn your Bloomberg
Speaker 1: on and look at this? So if I'm not misreading this,
Speaker 1: so you know, the n A V is eighteen fifty,
Speaker 1: the price is nine dollars, right, so the so the
Speaker 1: premium is about four four, meaning it's training at five x. Right,
Speaker 1: So if you you know, if if if bitcoin and
Speaker 1: this is mainly bitcoin, right, Bitcoin and of those ten currencies,
Speaker 1: you know, you know, we we can we can debate
Speaker 1: whether bitcoin is a bargain or not at but paying
Speaker 1: over a hundred thousand for a bitcoin when it's trading
Speaker 1: at twenty three thousand, that just seems crazy. It makes
Speaker 1: you wonder that people investing in this index, I mean,
Speaker 1: can they possibly know what they are doing, like what
Speaker 1: what they are exactly buying if they're buying it at
Speaker 1: such a premium, you know, right? I mean, doesn't you
Speaker 1: know you can just go out there and buy the
Speaker 1: bitcoin instead, right at at twenty three thousands, buying it
Speaker 1: for over a hund thousand. So I think I think
Speaker 1: part of and forgive me if I embarrassed myself here
Speaker 1: by talking about crypto, because we all know I'm not
Speaker 1: exactly the world's leading crypto authority, but I think the
Speaker 1: issue is you buy some bitcoin, it's not necessarily uh
Speaker 1: safe and secure on some exchange. We read about all
Speaker 1: these exchange getting hacked and whatnot, and bitcoin while it's
Speaker 1: getting looted. So I wonder part of that premium because
Speaker 1: the Gray Scale Trust, which is an older mutual fund
Speaker 1: that buys bitcoin, has always had a big nav premium
Speaker 1: like that, not quite like that. I think it's you know,
Speaker 1: like maybe sometimes, but I wonder if people are willing
Speaker 1: to pay up for the security and knowing that someone
Speaker 1: else is going to store this, keep it safe and
Speaker 1: and you're not gonna wake up and and see a
Speaker 1: zero balance someday if if the exchange you're dealing with
Speaker 1: it had gotten hacked. My best guest, yeah, I know
Speaker 1: that could be good. That that could be that could
Speaker 1: be right, you know, Or if you stored the information
Speaker 1: on your hard drive and and your girlfriend threw it
Speaker 1: away and you've got to go into the garbage looking
Speaker 1: for the hard drive. But I think part of it,
Speaker 1: maybe it's just that there's people out there are comfortably
Speaker 1: investing in equities. This is an equity, yeah right, and
Speaker 1: so it's just easier. You can go onto your brokerage
Speaker 1: account and buy it easily. You don't have to buy
Speaker 1: you know, you don't have to set up a separate
Speaker 1: of crypto account. Uh. That might be part of it,
Speaker 1: but you know, but paying five x just seems absolutely extreme,
Speaker 1: right and also also in a crypto and I guess
Speaker 1: I PO news coin Base has now filed confidentially to
Speaker 1: go public. So we're just going to ride the crypto train.
Speaker 1: Oh that that I p O is gonna I won't
Speaker 1: make any predictions, but boy, that'll be an interesting IPO.
Speaker 1: We'll see. Well anyway, maybe Sarah, maybe if there are
Speaker 1: some crypto expert I know we have a lot of
Speaker 1: crypto experts who listened to us, even though we don't
Speaker 1: give them a lot of a lot of content. But
Speaker 1: if anyone has any other ideas on why that fund
Speaker 1: is trading at such a premium, by all means, give
Speaker 1: our hotline a call and let us know. Please do please,
Speaker 1: do uh and unfortunately we are going to have to
Speaker 1: leave it there, but Danton goee. Thank you so much
Speaker 1: for joining the show this week. Mike, Sarah, it was
Speaker 1: a pleasure. Thank you so much for having me What
Speaker 1: Goes Up. We'll be back next week. Until then, you
Speaker 1: can find us on the Bloomberg Terminal website and app,
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Speaker 1: you took the time to rate and review the show
Speaker 1: on Apple Podcasts so more listeners can find us. And
Speaker 1: you can find us on Twitter, follow me at Sarah
Speaker 1: pont Seck, Mike is that reaganonymous, and you can also
Speaker 1: follow Bloomberg Podcasts at podcasts. Also, thank you to Charlie
Speaker 1: Pellett of Bloomberg Radio and the voice of the New
Speaker 1: York City Subway System. What Goes Up is produced by
Speaker 1: Jordan Gospore. The head of Bloomberg Podcast is Francesco Levie.
Speaker 1: Thanks for listening. See you next time.