1
00:00:02,080 --> 00:00:04,920
Speaker 1: Thanks for joining us for this special holiday edition of

2
00:00:04,920 --> 00:00:08,720
Speaker 1: Bloomberg Daybreak. I'm Nathan Hager. The US stock market is

3
00:00:08,800 --> 00:00:11,879
Speaker 1: closed for the fourth of July. Coming up this hour,

4
00:00:12,000 --> 00:00:14,880
Speaker 1: we have a high tech treat for you. If you've

5
00:00:14,880 --> 00:00:18,680
Speaker 1: been invested in technology stocks this year, it has been

6
00:00:18,800 --> 00:00:22,239
Speaker 1: quite the rewarding twenty twenty three. The Nasdaq by far

7
00:00:22,440 --> 00:00:25,239
Speaker 1: has been the best performer of the three major indexes

8
00:00:25,280 --> 00:00:29,040
Speaker 1: this year, but can the rally in tech last We'll

9
00:00:29,080 --> 00:00:31,960
Speaker 1: spend the entire hour looking at what's ahead for the sector,

10
00:00:32,040 --> 00:00:35,879
Speaker 1: including the mania surrounding artificial intelligence, with two of the

11
00:00:35,920 --> 00:00:39,360
Speaker 1: best on Wall Street. Gene Munster, the managing partner at

12
00:00:39,440 --> 00:00:42,560
Speaker 1: Deepwater Asset Management, is with us along with wet Bush

13
00:00:42,560 --> 00:00:47,239
Speaker 1: Securities senior equity analyst Dan Ives a tech roundtable for

14
00:00:47,280 --> 00:00:50,080
Speaker 1: the entire hour. Dan and Jean, it is great to

15
00:00:50,080 --> 00:00:52,200
Speaker 1: have you both with us. Dan, I want to start

16
00:00:52,240 --> 00:00:55,040
Speaker 1: with you because you got a lot of traction with

17
00:00:55,200 --> 00:00:58,640
Speaker 1: the note last week on the outlook for tech stocks

18
00:00:58,680 --> 00:01:00,960
Speaker 1: in the second half. Tell us more about why you

19
00:01:01,000 --> 00:01:04,720
Speaker 1: think the AI frenzy is more than just type look.

20
00:01:04,959 --> 00:01:06,920
Speaker 2: And it's great to be here, you know, with you

21
00:01:07,000 --> 00:01:09,880
Speaker 2: in Gene talking tech because in my opinion, it's a

22
00:01:10,080 --> 00:01:13,520
Speaker 2: fourth Industrial revolution that's playing out in front of our eyes.

23
00:01:14,040 --> 00:01:17,039
Speaker 2: We believe this is the start of a new tech

24
00:01:17,160 --> 00:01:19,759
Speaker 2: bull market, and which is why we think second half

25
00:01:19,800 --> 00:01:23,360
Speaker 2: of the year tech could be up fifteen, potentially twenty

26
00:01:23,360 --> 00:01:26,840
Speaker 2: percent in a much broader rally because of what's happening

27
00:01:26,880 --> 00:01:29,760
Speaker 2: from a growth perspective, I think it's ais tip of

28
00:01:29,800 --> 00:01:34,080
Speaker 2: the iceberg. We're seeing a stabilizing it spend environment, and

29
00:01:34,160 --> 00:01:36,920
Speaker 2: I believe this is something in our opinion that's the

30
00:01:36,959 --> 00:01:40,280
Speaker 2: only thing that's comparative is nineteen ninety five Internet moment

31
00:01:40,280 --> 00:01:42,400
Speaker 2: in two thousand and seven Apple iPhone.

32
00:01:42,560 --> 00:01:44,720
Speaker 1: You know, it's been a similar view that we've heard

33
00:01:44,760 --> 00:01:48,600
Speaker 1: from Don Fitzpatrick, the CEO of Soros Fund Management. She

34
00:01:48,680 --> 00:01:51,800
Speaker 1: spoke with us about AI last month at the Bloomberg

35
00:01:51,840 --> 00:01:55,000
Speaker 1: invest conference in New York. Here's what Don Fitzpatrick had

36
00:01:55,000 --> 00:01:55,320
Speaker 1: to say.

37
00:01:55,480 --> 00:01:57,920
Speaker 3: It is clear that we're at the beginning of a

38
00:01:58,040 --> 00:02:03,680
Speaker 3: megacycle in spending AI, and the real beneficiaries obviously are

39
00:02:03,720 --> 00:02:08,120
Speaker 3: the applications, so you're SaaS companies and infrastructure, so it's

40
00:02:08,280 --> 00:02:12,440
Speaker 3: it's cloud and your high performing chip companies.

41
00:02:12,760 --> 00:02:15,400
Speaker 1: Jane, let's bring you in on this. Is this the

42
00:02:15,440 --> 00:02:18,200
Speaker 1: beginning of a tech megacycle.

43
00:02:18,639 --> 00:02:21,840
Speaker 4: It is, and there's going to be some ebbs and

44
00:02:21,919 --> 00:02:24,040
Speaker 4: flows in terms of the stocks and the near term,

45
00:02:24,080 --> 00:02:28,000
Speaker 4: but I think that it will ultimately meet, exceed, will

46
00:02:28,040 --> 00:02:31,320
Speaker 4: comfortably exceed all of the hype. And the hype is

47
00:02:31,480 --> 00:02:36,800
Speaker 4: just intense. I mean, this universal optimism around it seems

48
00:02:36,880 --> 00:02:38,880
Speaker 4: hard to believe, but I think it is. There is

49
00:02:38,960 --> 00:02:42,120
Speaker 4: substance behind it. I want to frame in a couple

50
00:02:42,200 --> 00:02:46,040
Speaker 4: data points around that substance. At Microsoft's Developers Conference this year,

51
00:02:46,040 --> 00:02:50,480
Speaker 4: they showed a demo of the new Windows operating system.

52
00:02:50,680 --> 00:02:53,680
Speaker 4: And when I saw the demo again, it was an

53
00:02:53,720 --> 00:02:57,160
Speaker 4: animated demo. Wasn't live, but an animated demo. I thought,

54
00:02:57,520 --> 00:03:00,400
Speaker 4: these features are probably going to be out in five years,

55
00:03:00,560 --> 00:03:02,520
Speaker 4: and then they said it would be out later this year.

56
00:03:03,160 --> 00:03:04,120
Speaker 5: That never happens.

57
00:03:04,240 --> 00:03:06,480
Speaker 4: Usually. What happens is I think some is going to

58
00:03:06,560 --> 00:03:09,040
Speaker 4: take two years and takes five years in this case,

59
00:03:09,120 --> 00:03:11,640
Speaker 4: think it's going to take five in six months. And

60
00:03:11,680 --> 00:03:14,600
Speaker 4: then you look at Nvidia's guide, it's dated. It's back

61
00:03:14,600 --> 00:03:17,000
Speaker 4: when they reported their March quarter. They guide it for June.

62
00:03:17,400 --> 00:03:18,880
Speaker 4: I don't know, Dan, I don't know if you've ever

63
00:03:18,919 --> 00:03:22,799
Speaker 4: seen a guide like that, but going from the street

64
00:03:22,880 --> 00:03:25,800
Speaker 4: was looking for like ten percent sequential growth, they guide

65
00:03:25,800 --> 00:03:28,960
Speaker 4: it to ninety or one hundred percent sequential growth like

66
00:03:29,040 --> 00:03:31,640
Speaker 4: that doesn't happen, and exactly.

67
00:03:31,320 --> 00:03:34,880
Speaker 2: To your Genus always puts it, I think, just phenomenally.

68
00:03:34,920 --> 00:03:38,480
Speaker 2: And it goes back to the Nvidia guidance. I'll call

69
00:03:38,520 --> 00:03:41,600
Speaker 2: it the guidance heard around the world. Okay, that is

70
00:03:41,720 --> 00:03:45,040
Speaker 2: really the start of what we're going to start to see.

71
00:03:45,040 --> 00:03:49,040
Speaker 2: That's why, Nathan, when everyone does hype and and Gene,

72
00:03:49,160 --> 00:03:51,720
Speaker 2: I know you've talked about this a bunch too, it's

73
00:03:51,760 --> 00:03:54,200
Speaker 2: like it's not In other words, this is as real

74
00:03:54,400 --> 00:03:57,960
Speaker 2: of a spending trend as I've ever seen in my career.

75
00:03:58,640 --> 00:04:00,440
Speaker 2: That's why I view it is really the star of

76
00:04:00,480 --> 00:04:01,520
Speaker 2: a new tech bull market.

77
00:04:01,680 --> 00:04:04,000
Speaker 1: Well, I got to ask you guys both because you

78
00:04:04,240 --> 00:04:08,600
Speaker 1: mentioned this sort of having similarities to nineteen ninety five.

79
00:04:08,840 --> 00:04:11,240
Speaker 1: Of course, it was just a few years after nineteen

80
00:04:11,320 --> 00:04:14,440
Speaker 1: ninety five that we saw the nineteen ninety nine dot

81
00:04:14,480 --> 00:04:17,440
Speaker 1: com bubble burst. I mean, what's the risk, either Dan

82
00:04:17,600 --> 00:04:22,240
Speaker 1: Orgin that this huge spend that we've seen into the

83
00:04:22,279 --> 00:04:25,039
Speaker 1: AI space in just the last few months ends up

84
00:04:25,080 --> 00:04:26,200
Speaker 1: creating an asset bubble?

85
00:04:26,560 --> 00:04:30,000
Speaker 4: Yeah, I think what I come back to In nineteen

86
00:04:30,080 --> 00:04:34,320
Speaker 4: ninety seven nineteen ninety eight, was a junior analyst at

87
00:04:34,360 --> 00:04:38,280
Speaker 4: Piper Jaffrey and there was a company k Tel most

88
00:04:38,279 --> 00:04:40,040
Speaker 4: of who don't know who Ktael is. They had a

89
00:04:40,080 --> 00:04:43,279
Speaker 4: record subscription, eight track tapes, cassettes, who'd.

90
00:04:43,200 --> 00:04:46,719
Speaker 1: Vague memory dollar tell yeah, yeah.

91
00:04:46,160 --> 00:04:48,039
Speaker 4: And they announced they put a press release, so it

92
00:04:48,080 --> 00:04:50,040
Speaker 4: came over the facts that said that they're going to

93
00:04:50,200 --> 00:04:53,279
Speaker 4: start selling records online. Sock went from four to forty

94
00:04:53,400 --> 00:04:56,359
Speaker 4: over like a four month period, and it was a

95
00:04:56,440 --> 00:04:59,080
Speaker 4: company that didn't have any substance to it. I don't

96
00:04:59,080 --> 00:05:02,520
Speaker 4: even know if they ever sold anything online. I think

97
00:05:02,560 --> 00:05:06,240
Speaker 4: it was representative of hyping everywhere, and I think this

98
00:05:06,400 --> 00:05:10,160
Speaker 4: is different. Yes, we see what's happened with Nvidia, and

99
00:05:10,200 --> 00:05:13,600
Speaker 4: there is these AI stocks are up, the chip stocks are.

100
00:05:13,560 --> 00:05:14,760
Speaker 5: Up ninety percent this year.

101
00:05:15,040 --> 00:05:20,000
Speaker 4: Yeah, but to me, there is I like what you

102
00:05:20,040 --> 00:05:22,960
Speaker 4: said there, Dan, The guidance heard around the world is

103
00:05:23,000 --> 00:05:25,960
Speaker 4: that we weren't seeing that kind of guidance Back in

104
00:05:26,000 --> 00:05:29,480
Speaker 4: two thousand. There was this ad spend that was kind

105
00:05:29,480 --> 00:05:33,120
Speaker 4: of circulating. There's companies going public, they were getting money,

106
00:05:33,240 --> 00:05:35,680
Speaker 4: they were spending with other internet companies, and so there

107
00:05:35,760 --> 00:05:39,200
Speaker 4: was a little bit of a misleading positive sign back

108
00:05:39,240 --> 00:05:42,800
Speaker 4: around two thousand that ended up just drying up. This

109
00:05:42,920 --> 00:05:46,239
Speaker 4: feels like there's much more substance, and it's much more narrow.

110
00:05:46,320 --> 00:05:48,600
Speaker 4: It's not k tels aren't happening today.

111
00:05:48,880 --> 00:05:52,440
Speaker 2: Look, and Gene to his point, I believe the big

112
00:05:52,480 --> 00:05:55,680
Speaker 2: thing here in Microsoft, we believe for every one hundred

113
00:05:55,800 --> 00:06:00,160
Speaker 2: dollars of cloud spend, partners are talking about incremental twenty

114
00:06:00,240 --> 00:06:03,600
Speaker 2: five or forty dollars of AI spend. That changes the

115
00:06:03,640 --> 00:06:08,320
Speaker 2: whole paradigm of what Microsoft looks like in the next

116
00:06:08,320 --> 00:06:09,760
Speaker 2: five seven years.

117
00:06:10,080 --> 00:06:13,400
Speaker 1: Speaking with Dan Ives of Wedbush Securities and Gene Munster,

118
00:06:13,600 --> 00:06:17,320
Speaker 1: managing partner at Deepwater Asset Management. But to the point

119
00:06:17,480 --> 00:06:20,839
Speaker 1: about how so many companies now when you'll listen to

120
00:06:20,880 --> 00:06:23,560
Speaker 1: earnings calls, see the earnings reports, it seems like not

121
00:06:23,640 --> 00:06:26,360
Speaker 1: a day goes by that we don't hear about one

122
00:06:26,400 --> 00:06:30,320
Speaker 1: company after another just even mentioning AI in their reports,

123
00:06:30,360 --> 00:06:33,880
Speaker 1: and it spikes the stock. What's the risk that we

124
00:06:33,960 --> 00:06:38,040
Speaker 1: see so many companies talking about AI that they don't

125
00:06:38,080 --> 00:06:42,159
Speaker 1: necessarily have the bones to back it up. Geane, let's

126
00:06:42,160 --> 00:06:42,599
Speaker 1: start with you.

127
00:06:43,040 --> 00:06:46,120
Speaker 4: I mean there is a risk, but I always compared

128
00:06:46,160 --> 00:06:48,360
Speaker 4: to what happened twenty five years ago, and I think

129
00:06:48,360 --> 00:06:52,040
Speaker 4: that it's much more limited. I think I was recently

130
00:06:52,080 --> 00:06:54,440
Speaker 4: at a dinner in New York. There were twenty other

131
00:06:54,480 --> 00:06:57,039
Speaker 4: investors in the room, and I asked how many were

132
00:06:57,080 --> 00:07:01,000
Speaker 4: investing twenty five years ago the Internet bubble, and two

133
00:07:01,040 --> 00:07:03,320
Speaker 4: people's hands went up, and that got me a little

134
00:07:03,360 --> 00:07:05,400
Speaker 4: bit worried, like maybe we get a little we get

135
00:07:05,440 --> 00:07:09,000
Speaker 4: a repeat of what happened. But I think it is Nathan.

136
00:07:09,040 --> 00:07:10,520
Speaker 4: I think that the bottom line is I think it's

137
00:07:10,520 --> 00:07:14,160
Speaker 4: still limited that scope. I don't think every company is

138
00:07:14,200 --> 00:07:16,600
Speaker 4: claiming there an AI company. Not every company has had

139
00:07:16,680 --> 00:07:20,280
Speaker 4: an AI bid. Yes, the nasdacs up thirty two percent

140
00:07:20,360 --> 00:07:25,320
Speaker 4: this year, but what happens when you have panemonium is

141
00:07:25,320 --> 00:07:27,400
Speaker 4: when everything's up one hundred percent in six months, and

142
00:07:27,440 --> 00:07:29,880
Speaker 4: so we just haven't seen that kind of across the board.

143
00:07:29,920 --> 00:07:33,120
Speaker 4: It is good to remember, like what is the substance

144
00:07:33,160 --> 00:07:34,720
Speaker 4: of it? And I think that's where you get guys

145
00:07:34,760 --> 00:07:36,760
Speaker 4: like Dan out there who have seen this so many

146
00:07:36,800 --> 00:07:39,600
Speaker 4: times and can kind of parse between the hype and

147
00:07:39,600 --> 00:07:41,520
Speaker 4: the substance when it comes to which companies are going

148
00:07:41,600 --> 00:07:42,840
Speaker 4: to benefit of the long term.

149
00:07:42,880 --> 00:07:46,120
Speaker 1: So Dan is the substance just around in Nvidia and

150
00:07:46,480 --> 00:07:49,640
Speaker 1: that call hurd around the world that you mentioned earlier,

151
00:07:49,840 --> 00:07:54,000
Speaker 1: or is there more substance just beyond that major AI

152
00:07:54,120 --> 00:07:54,679
Speaker 1: chip maker.

153
00:07:55,000 --> 00:07:57,400
Speaker 2: Oh. I think there's as much meat on the boone

154
00:07:57,840 --> 00:08:01,920
Speaker 2: as I've seen of any tech and the last twenty years.

155
00:08:02,120 --> 00:08:04,280
Speaker 2: And I could tell you the last six or eight

156
00:08:04,320 --> 00:08:08,440
Speaker 2: weeks traveling the globe from Asia to Europe to US,

157
00:08:08,480 --> 00:08:12,480
Speaker 2: what we've seen. This is something that alternate we believe

158
00:08:12,520 --> 00:08:14,640
Speaker 2: could be eight to ten percent of budgets next year

159
00:08:14,960 --> 00:08:18,160
Speaker 2: AI today it's less than one percent. And I think

160
00:08:18,240 --> 00:08:21,760
Speaker 2: that's why we're spending all of our time, not just

161
00:08:21,840 --> 00:08:25,160
Speaker 2: myself as a tech group, who are the second third

162
00:08:25,840 --> 00:08:28,760
Speaker 2: worth derivatives? That's what we're spending our time on.

163
00:08:28,960 --> 00:08:31,840
Speaker 1: Where do you see some of those second third, fourth derivatives? Gane?

164
00:08:32,200 --> 00:08:34,440
Speaker 4: I think, well, I think there's a first derivative that

165
00:08:34,679 --> 00:08:35,680
Speaker 4: people aren't picking up on.

166
00:08:35,720 --> 00:08:36,560
Speaker 5: A couple of them.

167
00:08:37,040 --> 00:08:40,400
Speaker 4: Google is one that is not a consensus. At that

168
00:08:40,440 --> 00:08:43,400
Speaker 4: dinner that I mentioned, had a survey before this was

169
00:08:43,640 --> 00:08:48,360
Speaker 4: in a combination with Piper Sandler, and the survey that

170
00:08:48,480 --> 00:08:52,120
Speaker 4: was done included which were the consensus AI stocks and

171
00:08:53,000 --> 00:08:55,720
Speaker 4: Google was not on that consensus. List, which surprised me

172
00:08:56,120 --> 00:08:59,319
Speaker 4: and when I asked about it, it's investors are still

173
00:09:00,240 --> 00:09:02,560
Speaker 4: skeptical or concern that there's going to be a dip

174
00:09:02,559 --> 00:09:05,280
Speaker 4: in their AD revenue and that this basic idea that

175
00:09:05,320 --> 00:09:06,920
Speaker 4: they have a lot to lose. I think they have

176
00:09:06,960 --> 00:09:08,800
Speaker 4: a lot to gain potentially. I do believe that they're

177
00:09:08,800 --> 00:09:11,040
Speaker 4: going to have a speed bump in their revenue as

178
00:09:11,080 --> 00:09:15,560
Speaker 4: they shift to single results driven by AI. But I

179
00:09:15,559 --> 00:09:19,000
Speaker 4: think Google, their twenty years of data, is going to

180
00:09:19,040 --> 00:09:22,200
Speaker 4: create more informed search results even with AI, and I

181
00:09:22,200 --> 00:09:25,160
Speaker 4: think that they, even though it's out, consider that a

182
00:09:25,200 --> 00:09:28,360
Speaker 4: second derivative because I think investors are largely ignored. I

183
00:09:28,360 --> 00:09:30,200
Speaker 4: think one of the companies is going to surprise people

184
00:09:30,520 --> 00:09:33,319
Speaker 4: in the next twelve months about their AI performance.

185
00:09:33,400 --> 00:09:33,840
Speaker 5: Is Meta.

186
00:09:34,320 --> 00:09:37,359
Speaker 4: I think what they're doing is it's just pure adrenaline

187
00:09:37,440 --> 00:09:42,320
Speaker 4: to advertisers to improve ad attribution, and I think it's

188
00:09:42,320 --> 00:09:46,520
Speaker 4: going to invite more ad spending after what has happened

189
00:09:46,760 --> 00:09:49,920
Speaker 4: with some of the changes the IDFA from what Apple's

190
00:09:49,920 --> 00:09:52,080
Speaker 4: put in place a year and a half ago. So

191
00:09:52,120 --> 00:09:56,800
Speaker 4: I think those aren't aren't I think given the proper attention,

192
00:09:57,360 --> 00:10:00,679
Speaker 4: as we deep water, we invest in both public and

193
00:10:00,720 --> 00:10:03,800
Speaker 4: private companies, and so I can say where most of

194
00:10:03,840 --> 00:10:07,160
Speaker 4: our attention is on the private side, it's looking at

195
00:10:07,160 --> 00:10:10,880
Speaker 4: the chip architecture and the basic idea is right now

196
00:10:11,480 --> 00:10:15,400
Speaker 4: video is running away with this and they but they're chips.

197
00:10:15,679 --> 00:10:18,920
Speaker 4: Still it's expensive to train models right now. Open Ai

198
00:10:19,080 --> 00:10:21,800
Speaker 4: trains their models about once every three weeks. It typically

199
00:10:21,800 --> 00:10:24,439
Speaker 4: takes about five million dollars to do it. So there

200
00:10:24,480 --> 00:10:28,319
Speaker 4: needs to be new technologies to enable better chip architectures

201
00:10:28,360 --> 00:10:30,360
Speaker 4: to bring down the cost of training.

202
00:10:30,640 --> 00:10:32,760
Speaker 1: We're going to keep up this conversation talk a little

203
00:10:32,760 --> 00:10:36,240
Speaker 1: bit more about the applications for artificial intelligence as we

204
00:10:36,320 --> 00:10:39,439
Speaker 1: continue this discussion with Gene Monster of Deepwater Asset Dan

205
00:10:39,520 --> 00:10:43,320
Speaker 1: Ives of Webbush on this special edition of Bloomberg Daybreak

206
00:10:43,320 --> 00:10:46,680
Speaker 1: with a focus on Tech. It is eighteen minutes past

207
00:10:46,760 --> 00:10:58,240
Speaker 1: the hour. I'm Nathan Hager, and this is Bloomberg. Welcome

208
00:10:58,240 --> 00:11:01,440
Speaker 1: back to the special edition of Bloomberg Daybreak. I'm Nathan Hager.

209
00:11:01,520 --> 00:11:05,040
Speaker 1: The US stock market is closed for the Independence Day holiday,

210
00:11:05,080 --> 00:11:07,319
Speaker 1: and we continue our focus on tech now with Dan.

211
00:11:07,400 --> 00:11:11,000
Speaker 1: I've senior equity strategistic web Bush Securities and Deepwater Asset

212
00:11:11,040 --> 00:11:14,040
Speaker 1: Management managing partner Gene Munster. I want to pick up

213
00:11:14,320 --> 00:11:17,319
Speaker 1: on this conversation we're having guys about the applications for

214
00:11:17,440 --> 00:11:20,880
Speaker 1: artificial intelligence beyond so much of the investment that we've

215
00:11:20,920 --> 00:11:23,839
Speaker 1: been seeing just over the last few months. Someone who's

216
00:11:23,920 --> 00:11:28,480
Speaker 1: really gone all in on the innovation industry is Kathy

217
00:11:28,559 --> 00:11:31,760
Speaker 1: Wood of OARC Investment Management. Here's some of what she's

218
00:11:31,880 --> 00:11:34,760
Speaker 1: had to say. When it comes to AI, many people.

219
00:11:34,600 --> 00:11:39,280
Speaker 6: Think it's just hardware and software stocks widely advertised. But Tesla,

220
00:11:39,720 --> 00:11:42,760
Speaker 6: many people think, is an auto stock. We don't. We

221
00:11:42,800 --> 00:11:45,959
Speaker 6: think it's much more than that. But we think it's

222
00:11:46,000 --> 00:11:48,199
Speaker 6: one of the biggest AI opportunities out there.

223
00:11:48,520 --> 00:11:50,400
Speaker 1: I want to pick up with with you, Gene, because

224
00:11:50,400 --> 00:11:53,080
Speaker 1: there has been this long running debate about whether Tesla

225
00:11:53,120 --> 00:11:55,600
Speaker 1: is an auto company or a software company. But just

226
00:11:55,640 --> 00:11:57,480
Speaker 1: to take the broader view some of what we've been

227
00:11:57,520 --> 00:12:00,440
Speaker 1: talking about already, is there a case for AI to

228
00:12:00,600 --> 00:12:03,320
Speaker 1: change the direction of other sectors, even outside of tech.

229
00:12:04,120 --> 00:12:09,000
Speaker 4: Definitely, I think Tesla's a outside of the typical companies

230
00:12:09,000 --> 00:12:10,719
Speaker 4: that we talk about that are having an impact over

231
00:12:10,720 --> 00:12:13,760
Speaker 4: the next six months. Tesla's clearly in a spot and

232
00:12:13,880 --> 00:12:17,640
Speaker 4: the lines are are obvious where they're going to benefit

233
00:12:17,760 --> 00:12:22,560
Speaker 4: and this around autonomy I've got a seven year old

234
00:12:22,559 --> 00:12:25,320
Speaker 4: of a five year old, and I have a bet

235
00:12:25,320 --> 00:12:28,679
Speaker 4: with my wife that they'll never drive. And I think

236
00:12:28,720 --> 00:12:32,320
Speaker 4: that autonomy is a piece that obviously Tesla has been

237
00:12:32,360 --> 00:12:34,920
Speaker 4: more active around that. I think we're going to have

238
00:12:34,960 --> 00:12:39,360
Speaker 4: a chat GPT moment around autonomy that in the next

239
00:12:39,440 --> 00:12:43,400
Speaker 4: year where it's really going to leap forward. Humans shouldn't drive.

240
00:12:44,040 --> 00:12:46,200
Speaker 4: There's more than thirty thousand people in the US lose

241
00:12:46,280 --> 00:12:49,160
Speaker 4: their lives in car accidents. People are more distracted, and

242
00:12:49,600 --> 00:12:51,600
Speaker 4: machines can help fix that. And I think AI is

243
00:12:51,600 --> 00:12:54,960
Speaker 4: an obvious opportunity and Tesla's a beneficiary. Not to mention

244
00:12:55,040 --> 00:12:58,640
Speaker 4: the toy store with Optimus Prime don't have any of

245
00:12:58,679 --> 00:13:03,200
Speaker 4: that my model, but it is an opportunity on just

246
00:13:03,280 --> 00:13:05,080
Speaker 4: kind of I think a great example of things that

247
00:13:05,120 --> 00:13:07,600
Speaker 4: Tesla does that no other car company would even touch.

248
00:13:07,800 --> 00:13:11,199
Speaker 1: Interesting thought to bring in the transformers of the autobots

249
00:13:11,200 --> 00:13:15,440
Speaker 1: of the Decepticons. Are you know this idea that there's

250
00:13:15,480 --> 00:13:18,360
Speaker 1: a dark side potentially to AI and the threat that

251
00:13:18,400 --> 00:13:21,599
Speaker 1: it could potentially pose to society. But I want to

252
00:13:21,640 --> 00:13:24,400
Speaker 1: pick up on what we're talking about in terms of

253
00:13:24,640 --> 00:13:30,200
Speaker 1: automation and this idea that artificial intelligence could add to this.

254
00:13:30,840 --> 00:13:34,160
Speaker 1: You know, key that Tesla is trying to crack here

255
00:13:34,520 --> 00:13:37,280
Speaker 1: when it comes to getting cars to drive on their own. Dan,

256
00:13:37,400 --> 00:13:40,120
Speaker 1: I know you've been bullish on Tesla for a long time,

257
00:13:40,160 --> 00:13:42,720
Speaker 1: but this has been something that not just Tesla, but

258
00:13:42,800 --> 00:13:44,920
Speaker 1: a lot of car companies have really been struggling to

259
00:13:44,960 --> 00:13:45,400
Speaker 1: get right.

260
00:13:45,760 --> 00:13:50,800
Speaker 2: Look, I mean FSD, that's that's ultimate, that's the golden goose, right,

261
00:13:50,840 --> 00:13:53,559
Speaker 2: I mean for Tessa. I mean when you think about

262
00:13:53,720 --> 00:13:56,040
Speaker 2: the AI story.

263
00:13:55,679 --> 00:13:58,840
Speaker 7: When when you think about ultimately autonomous, and there's Genes

264
00:13:58,880 --> 00:14:01,760
Speaker 7: talking about I still think there's a chance ten years

265
00:14:01,760 --> 00:14:04,440
Speaker 7: and that Jean's kids maybe you're driving a cyborgalk but

266
00:14:04,600 --> 00:14:07,360
Speaker 7: you know, we'll see how that plays out. I think

267
00:14:07,840 --> 00:14:11,800
Speaker 7: this is really what they need to crack, especially when

268
00:14:11,840 --> 00:14:15,160
Speaker 7: it comes to the Delta Beta version for Tesla, I

269
00:14:15,200 --> 00:14:18,640
Speaker 7: think they're way advanced. You got dam Aroro Wimo and

270
00:14:18,760 --> 00:14:21,680
Speaker 7: that's the holy ground, and I do believe the next

271
00:14:21,720 --> 00:14:24,280
Speaker 7: five six years we're going to get to autonomous.

272
00:14:24,880 --> 00:14:29,760
Speaker 8: That's much I think closer to what many think from

273
00:14:29,880 --> 00:14:32,920
Speaker 8: skeptically that Tassa and others are going to get to.

274
00:14:32,960 --> 00:14:35,600
Speaker 8: And that's why I think it's the biggest transformation to

275
00:14:35,640 --> 00:14:38,360
Speaker 8: the auto industry during the last sixty years.

276
00:14:38,600 --> 00:14:43,840
Speaker 1: Yeah, they have transformative technology, something that really gets investors excited.

277
00:14:43,960 --> 00:14:47,320
Speaker 1: But it raises the question about whether this technology that

278
00:14:47,360 --> 00:14:49,880
Speaker 1: we hadn't been talking about even just a few months ago,

279
00:14:50,320 --> 00:14:54,160
Speaker 1: is developing so quickly that it runs ahead of us. Gene,

280
00:14:54,680 --> 00:14:57,640
Speaker 1: what are the risks to society from AI deep are?

281
00:14:57,640 --> 00:14:59,640
Speaker 4: We spent a lot of time thinking about this, and

282
00:15:00,280 --> 00:15:03,440
Speaker 4: ultimately we have a view of where AI is going

283
00:15:03,520 --> 00:15:05,280
Speaker 4: to impact us the next ten years, and I'd just

284
00:15:05,320 --> 00:15:07,600
Speaker 4: start with I think humanity is still going to be around.

285
00:15:08,160 --> 00:15:12,040
Speaker 4: I don't think this apocalyptic view that even Elon Musk

286
00:15:12,080 --> 00:15:15,680
Speaker 4: has endorsed is anything close to reality. I think that

287
00:15:15,760 --> 00:15:19,720
Speaker 4: this is another wave of innovation and efficiency that's going

288
00:15:19,760 --> 00:15:25,720
Speaker 4: to benefit humanity from just a lifestyle standpoint. But there

289
00:15:25,760 --> 00:15:28,800
Speaker 4: will clearly be jobs lost, and I agree with consensus

290
00:15:28,800 --> 00:15:32,720
Speaker 4: it's going to be kind of lower or maybe more

291
00:15:33,240 --> 00:15:36,760
Speaker 4: customer support types of jobs. They go the way of

292
00:15:36,800 --> 00:15:39,840
Speaker 4: being like a travel agent. Essentially, those will be replaced

293
00:15:39,840 --> 00:15:42,000
Speaker 4: by a but I think other people with high paying jobs.

294
00:15:42,000 --> 00:15:43,560
Speaker 4: I think there's still gonna be a lot of developers

295
00:15:43,560 --> 00:15:45,920
Speaker 4: out there that will be assisting AI, and I think

296
00:15:45,920 --> 00:15:48,720
Speaker 4: those are going to be great jobs. I think another

297
00:15:48,800 --> 00:15:51,280
Speaker 4: piece at decade for now with AI is that truth

298
00:15:52,080 --> 00:15:55,520
Speaker 4: will be much more elusive, and I think that that

299
00:15:55,640 --> 00:16:01,920
Speaker 4: potentially could cause some civil unrest. And recently was watching

300
00:16:02,880 --> 00:16:08,040
Speaker 4: a quick video of a Russian soldier surrendering to a

301
00:16:08,200 --> 00:16:10,760
Speaker 4: Ukrainian drone and we're debating it on our team, and

302
00:16:11,000 --> 00:16:13,480
Speaker 4: the one person on our team felt that it was

303
00:16:13,960 --> 00:16:17,560
Speaker 4: AI driven and it was just a fake And as

304
00:16:17,600 --> 00:16:20,120
Speaker 4: we debated it, I recognized like there was like tension in.

305
00:16:20,080 --> 00:16:21,720
Speaker 5: The room, like is this real? Is it fake?

306
00:16:21,760 --> 00:16:24,000
Speaker 4: And I think it's just a microcosm of what we're

307
00:16:24,000 --> 00:16:25,400
Speaker 4: going to see in the next decade. We're not going

308
00:16:25,480 --> 00:16:27,120
Speaker 4: to know what's real and what's true. I think that's

309
00:16:27,120 --> 00:16:30,400
Speaker 4: a problem related to AI. I think life expectancy is

310
00:16:30,440 --> 00:16:31,960
Speaker 4: going to take a jump up. Look at the curve

311
00:16:31,960 --> 00:16:34,520
Speaker 4: of the life expectancy curve over the last two hundred years,

312
00:16:34,880 --> 00:16:37,720
Speaker 4: took a big jump up when they could start to

313
00:16:37,720 --> 00:16:42,080
Speaker 4: do surgery, penicilla and things like that. But I think

314
00:16:42,120 --> 00:16:45,640
Speaker 4: we're in another stage where life expectancy takes a leap forward.

315
00:16:46,040 --> 00:16:48,320
Speaker 4: And the last piece is we talked about a minute ago.

316
00:16:48,320 --> 00:16:49,840
Speaker 4: I don't think cars, I don't think people will be

317
00:16:49,880 --> 00:16:51,000
Speaker 4: driving cars in ten years.

318
00:16:51,520 --> 00:16:52,880
Speaker 5: That's kind of how I see it.

319
00:16:52,880 --> 00:16:56,120
Speaker 1: It is interesting Dan, the idea that you know, it's

320
00:16:56,160 --> 00:17:01,160
Speaker 1: still relatively easy to see whether a deep fake is

321
00:17:01,200 --> 00:17:04,440
Speaker 1: a fake, but it's getting a lot harder really quickly.

322
00:17:05,040 --> 00:17:07,440
Speaker 1: What's your concern or is there a concern for you

323
00:17:07,880 --> 00:17:10,600
Speaker 1: that artificial intelligence is going to make it tougher for

324
00:17:10,640 --> 00:17:12,960
Speaker 1: a lot of people to know what's real and what's not.

325
00:17:13,520 --> 00:17:16,800
Speaker 2: Yeah, I'm look gene brings up I think great points.

326
00:17:16,840 --> 00:17:19,879
Speaker 2: I think the thing that probably worries me the most

327
00:17:19,920 --> 00:17:23,640
Speaker 2: when it comes to AI is and I think regulator

328
00:17:23,840 --> 00:17:26,240
Speaker 2: You're starting to see at both Brussels as well as

329
00:17:26,240 --> 00:17:30,440
Speaker 2: the belt Way. You know, does tech just get more

330
00:17:30,440 --> 00:17:34,360
Speaker 2: and more powerful, right? I mean the stronger, stronger if

331
00:17:34,359 --> 00:17:37,400
Speaker 2: you look from the chips to the software. I mean,

332
00:17:37,920 --> 00:17:40,040
Speaker 2: even though it's going to be broader, you're going to

333
00:17:40,119 --> 00:17:43,800
Speaker 2: have tech just getting that much more stronger. So that's

334
00:17:43,840 --> 00:17:47,000
Speaker 2: something where what does that ultimately lead to? And then

335
00:17:47,080 --> 00:17:50,920
Speaker 2: I think the bigger issue is potential from a data

336
00:17:51,000 --> 00:17:54,360
Speaker 2: perspective in terms of where AI is taken to make

337
00:17:54,400 --> 00:17:57,400
Speaker 2: sure that there's guardrails in place, and I think that's

338
00:17:57,400 --> 00:18:01,240
Speaker 2: something they're regulators, the White House, you know across the board,

339
00:18:02,520 --> 00:18:06,000
Speaker 2: that's a worry because this is going one hundred miles

340
00:18:06,000 --> 00:18:10,400
Speaker 2: an hour, and the concern is regulatory is going fifteen

341
00:18:10,400 --> 00:18:12,840
Speaker 2: to twenty miles an hour, and how's that all going

342
00:18:12,920 --> 00:18:13,440
Speaker 2: to play out?

343
00:18:14,080 --> 00:18:16,440
Speaker 1: And the thing is Congress doesn't exactly have the best

344
00:18:16,480 --> 00:18:19,080
Speaker 1: track record when it comes to staying ahead of technology

345
00:18:19,119 --> 00:18:21,600
Speaker 1: and putting regulations around it. But we've also heard from

346
00:18:21,640 --> 00:18:24,480
Speaker 1: the likes of Sam Altman of open ai, the parent

347
00:18:24,520 --> 00:18:28,280
Speaker 1: company of chat GPT, calling on Congress and other regulators

348
00:18:28,560 --> 00:18:32,199
Speaker 1: to put guardrails around AI gene. What's your view on

349
00:18:32,280 --> 00:18:35,479
Speaker 1: whether regulators can get it right when it comes to

350
00:18:35,600 --> 00:18:38,000
Speaker 1: keeping artificial intelligence under control?

351
00:18:38,680 --> 00:18:39,760
Speaker 5: Totally agree with Dan.

352
00:18:39,840 --> 00:18:42,439
Speaker 4: I think that we need regulators, we need Washington to

353
00:18:42,440 --> 00:18:46,040
Speaker 4: step in. What's the reality of them being able to

354
00:18:46,080 --> 00:18:51,080
Speaker 4: actually regulate this, I think it's slim to none. I

355
00:18:51,119 --> 00:18:54,439
Speaker 4: think they haven't been able to regulate basic social media

356
00:18:55,200 --> 00:18:59,280
Speaker 4: over the past decade, and you know, they've been talking

357
00:18:59,320 --> 00:19:01,679
Speaker 4: about breaking up big tech. I don't think it's for

358
00:19:01,720 --> 00:19:04,600
Speaker 4: the good of the country, but that you know, basically

359
00:19:04,680 --> 00:19:06,840
Speaker 4: hasn't happened, and so I think there's gonna be a

360
00:19:06,880 --> 00:19:10,159
Speaker 4: lot of talker regulation. I would even point This is

361
00:19:10,480 --> 00:19:13,120
Speaker 4: Zuckerberg has talked, has asked for regulation. This is after

362
00:19:13,160 --> 00:19:16,399
Speaker 4: the Cambridge Analytics tobaccle I forget what year that was,

363
00:19:16,440 --> 00:19:20,720
Speaker 4: five years ago, and asking for more help and it's

364
00:19:20,800 --> 00:19:24,280
Speaker 4: just hasn't happened. I love Dan's analogy there is that

365
00:19:24,320 --> 00:19:25,560
Speaker 4: this is going one hundred miles an hour, and the

366
00:19:25,600 --> 00:19:27,919
Speaker 4: regulars are going ten miles an hour, fifteen miles an hour,

367
00:19:27,960 --> 00:19:30,560
Speaker 4: and that makes sense, and I just think that they're

368
00:19:30,600 --> 00:19:31,640
Speaker 4: not going to be able to keep up.

369
00:19:31,880 --> 00:19:35,159
Speaker 1: Yeah, what about the tech sector more broadly? Could we

370
00:19:35,200 --> 00:19:38,960
Speaker 1: start to see some attention beyond the prevailing narrative. Gina

371
00:19:39,000 --> 00:19:40,920
Speaker 1: Martin Adams has been weighing in on that. She is

372
00:19:41,000 --> 00:19:44,080
Speaker 1: the chief equity strategist at Bloomberg Intelligence. Here's some of

373
00:19:44,119 --> 00:19:46,199
Speaker 1: what she has had to say about the outlook for

374
00:19:46,280 --> 00:19:47,800
Speaker 1: tech beyond AI.

375
00:19:48,400 --> 00:19:50,800
Speaker 9: I think you'll see those gains broadened out to other

376
00:19:50,880 --> 00:19:54,200
Speaker 9: segments of tech and some of this these defensive trades,

377
00:19:54,200 --> 00:19:56,760
Speaker 9: which I would call Apple and Microsoft and the mega

378
00:19:56,760 --> 00:20:01,840
Speaker 9: capstocks largely defensive trades the area of the market that

379
00:20:01,880 --> 00:20:05,920
Speaker 9: investors go to, heiden while nothing else is working. Things

380
00:20:05,920 --> 00:20:07,600
Speaker 9: are going to start to work a little bit better

381
00:20:07,640 --> 00:20:09,439
Speaker 9: later this year and into twenty twenty four, and so

382
00:20:09,440 --> 00:20:11,919
Speaker 9: I would expect tech to broaden out to more constituent

383
00:20:11,960 --> 00:20:13,000
Speaker 9: gains across the board.

384
00:20:13,520 --> 00:20:17,280
Speaker 1: Dan, you're looking for more broad gains beyond the AI story.

385
00:20:17,520 --> 00:20:20,480
Speaker 2: I mean, that's exactly our thesis. I think earning season

386
00:20:21,359 --> 00:20:24,200
Speaker 2: that we see for two Q, you're seeing a stabilizing

387
00:20:24,280 --> 00:20:28,359
Speaker 2: it spending environment on enterprise. I think digital advertising is

388
00:20:28,359 --> 00:20:31,400
Speaker 2: starting to stabilize as well, and especially when it comes

389
00:20:31,400 --> 00:20:36,879
Speaker 2: to software. This is really what I view as a

390
00:20:37,119 --> 00:20:43,800
Speaker 2: period where especially in areas like cybersecurity, cloud infrastructure, big

391
00:20:43,920 --> 00:20:46,800
Speaker 2: data of course AI, which is really leading a lot

392
00:20:46,840 --> 00:20:49,680
Speaker 2: of this. I think street numbers they rip the band

393
00:20:49,680 --> 00:20:52,119
Speaker 2: aid off. I think a lot of these numbers I

394
00:20:52,280 --> 00:20:55,200
Speaker 2: wouldn't call it samdbag guide in but I think they're

395
00:20:55,240 --> 00:20:58,720
Speaker 2: setting up for numbers to go higher. And in my opinion,

396
00:20:59,160 --> 00:21:02,440
Speaker 2: this earning sea, I think the bears just go back

397
00:21:02,520 --> 00:21:03,320
Speaker 2: into hibernation.

398
00:21:03,440 --> 00:21:07,600
Speaker 1: Work interesting. What about you, Gene, I mean the valuations

399
00:21:07,720 --> 00:21:11,159
Speaker 1: have been eye popping this year. Can this kind of

400
00:21:11,200 --> 00:21:12,240
Speaker 1: momentum continue?

401
00:21:12,600 --> 00:21:15,159
Speaker 4: I mean there's a saying that I have here, I

402
00:21:15,160 --> 00:21:18,800
Speaker 4: want my cake and ice cream too, and.

403
00:21:19,240 --> 00:21:22,920
Speaker 5: I think that I think there's going to be a pullback.

404
00:21:23,359 --> 00:21:27,280
Speaker 4: But I also want to be very clear, I'm on

405
00:21:27,359 --> 00:21:29,360
Speaker 4: board with this is going to be a great tech

406
00:21:29,480 --> 00:21:32,439
Speaker 4: rally over the next year. So my general sense is

407
00:21:32,480 --> 00:21:36,520
Speaker 4: that we've had some optimism around the market. More broadly,

408
00:21:37,000 --> 00:21:39,680
Speaker 4: I think that what the Fed's doing, there's been some optimism.

409
00:21:39,720 --> 00:21:42,359
Speaker 4: I just think that this earnings periods, there's going to

410
00:21:42,359 --> 00:21:46,320
Speaker 4: be a natural cooling off. But that's getting cute, and

411
00:21:46,560 --> 00:21:49,600
Speaker 4: I think ultimately you fast forward a year from now,

412
00:21:49,640 --> 00:21:52,119
Speaker 4: I think that these are going higher. I can say

413
00:21:52,160 --> 00:21:55,439
Speaker 4: that we've been cautious with one of our funds and

414
00:21:56,080 --> 00:21:59,240
Speaker 4: we've been just a pointing cash over the last month

415
00:21:59,240 --> 00:22:01,399
Speaker 4: and will continue to do that through the summer, even

416
00:22:01,440 --> 00:22:02,280
Speaker 4: though we think there's going to.

417
00:22:02,320 --> 00:22:03,280
Speaker 5: Be some pullbacks.

418
00:22:03,560 --> 00:22:07,119
Speaker 4: So but I think that nuance kind of misses the point.

419
00:22:07,200 --> 00:22:10,000
Speaker 4: I agree with dyon that this is setting up to

420
00:22:10,000 --> 00:22:15,160
Speaker 4: be just a wonderful year in tech. And as Dan

421
00:22:15,240 --> 00:22:18,840
Speaker 4: said at the top, like these these waves come around.

422
00:22:19,200 --> 00:22:22,080
Speaker 4: There's there's a wave every ten years in tech, there's

423
00:22:22,080 --> 00:22:25,119
Speaker 4: a paradigm shift every twenty thirty years, and we're in

424
00:22:25,119 --> 00:22:27,520
Speaker 4: a paradigm shift phase and that can boost things. I

425
00:22:27,520 --> 00:22:31,600
Speaker 4: mean that that powered fifteen years a tech performance.

426
00:22:31,640 --> 00:22:34,959
Speaker 5: So I think my nuanced.

427
00:22:34,480 --> 00:22:37,040
Speaker 4: About this June quarter and whether it's going to do

428
00:22:37,080 --> 00:22:39,560
Speaker 4: these tech stocks is decide the point. I think that

429
00:22:39,600 --> 00:22:41,040
Speaker 4: a year from now things are going to be higher.

430
00:22:41,160 --> 00:22:43,080
Speaker 1: Think he's been a little bit too nuanced, Dan.

431
00:22:43,400 --> 00:22:46,359
Speaker 2: Not at all. Look, I think the way Jeane is

432
00:22:46,440 --> 00:22:50,200
Speaker 2: always thought about tech stocks, I've just always been so

433
00:22:50,280 --> 00:22:53,360
Speaker 2: impressed by because he's able to see the farest through

434
00:22:53,359 --> 00:22:56,560
Speaker 2: the trees, whether it's Apple, whether it's Meta, whether it's others.

435
00:22:56,600 --> 00:22:59,440
Speaker 2: And I think we are in one of those moments.

436
00:22:59,560 --> 00:23:03,280
Speaker 2: We are in this fourth Industrial Revolution. That's why investors

437
00:23:03,280 --> 00:23:07,280
Speaker 2: will fret about a quarter too. They'll be cautious like

438
00:23:07,320 --> 00:23:10,560
Speaker 2: they have this year. But I really believe tech starts

439
00:23:10,560 --> 00:23:14,560
Speaker 2: to inflect higher second half of the year despite this

440
00:23:14,680 --> 00:23:17,800
Speaker 2: poker game between the market and the Fed and you know,

441
00:23:17,840 --> 00:23:20,560
Speaker 2: everyone watching the ten year. I think that you need

442
00:23:20,600 --> 00:23:24,400
Speaker 2: to be macro aware, micro obsessed.

443
00:23:24,760 --> 00:23:27,879
Speaker 5: I love it. You know we're talking about performance. Ay.

444
00:23:27,920 --> 00:23:29,760
Speaker 5: Then I got to ask a question here, Nathan, is

445
00:23:29,760 --> 00:23:30,200
Speaker 5: that okay?

446
00:23:31,400 --> 00:23:33,640
Speaker 4: And I got to say when I was so excited

447
00:23:33,680 --> 00:23:35,719
Speaker 4: to join Dan here, got so much respect for this

448
00:23:35,800 --> 00:23:38,840
Speaker 4: man and what he's done for tech investors over the

449
00:23:38,920 --> 00:23:41,320
Speaker 4: last twenty years. And I haven't had a chance to

450
00:23:41,359 --> 00:23:45,440
Speaker 4: talk to him about Vision Pro, and I love your

451
00:23:45,440 --> 00:23:48,200
Speaker 4: take Apple's vision Pro yep, Apple's Vision Pro.

452
00:23:48,680 --> 00:23:52,720
Speaker 2: Well, look my view on vision Pro, it's it's just

453
00:23:52,800 --> 00:23:56,160
Speaker 2: the start of what I've view as a broader ecosystem

454
00:23:56,200 --> 00:23:59,359
Speaker 2: that Apple's going to build, which we believe over next

455
00:23:59,359 --> 00:24:02,560
Speaker 2: twelve eighteen months it's going to be its own form

456
00:24:02,640 --> 00:24:06,800
Speaker 2: factor and eventually an AI app store that Apple's going

457
00:24:06,840 --> 00:24:10,600
Speaker 2: to own. So I view Vision Pro as thirty five

458
00:24:10,720 --> 00:24:14,560
Speaker 2: hundred the average investor views is obviously pricing. It's not

459
00:24:14,560 --> 00:24:17,080
Speaker 2: about one hundred and fifty thousand units moving the needle

460
00:24:17,400 --> 00:24:19,920
Speaker 2: because gene Knew is better than anyone pine in the world.

461
00:24:20,160 --> 00:24:22,720
Speaker 2: Two years from now, we believe that's fifteen hundred hours

462
00:24:22,800 --> 00:24:26,800
Speaker 2: seventeen hundred, you'll start to see that demand continued to increase.

463
00:24:26,800 --> 00:24:30,280
Speaker 2: But I believe the golden goose why Apple is playing

464
00:24:30,359 --> 00:24:33,200
Speaker 2: chess and others are plane checkers. This is the start

465
00:24:33,240 --> 00:24:36,200
Speaker 2: of we view as an AI app store for Apple.

466
00:24:36,680 --> 00:24:39,400
Speaker 1: I throw a little cold water on this because their

467
00:24:39,640 --> 00:24:44,320
Speaker 1: price point on vision Pro was so huge when they

468
00:24:44,359 --> 00:24:47,679
Speaker 1: first announced it, and it plays into this whole idea

469
00:24:48,200 --> 00:24:51,560
Speaker 1: of augmented reality, the metaverse that got so much attention

470
00:24:52,240 --> 00:24:56,280
Speaker 1: last year other than Vision Pro hasn't gotten much talk

471
00:24:56,320 --> 00:25:00,800
Speaker 1: now that there's been so much focus on AI, is

472
00:25:00,840 --> 00:25:06,440
Speaker 1: there still room for augmented reality the metaverse? In the Tech.

473
00:25:06,320 --> 00:25:10,640
Speaker 4: Story glad to hear Dan's take on it. My view

474
00:25:10,760 --> 00:25:16,159
Speaker 4: is that investors are grossly underestimating what vision Pro and

475
00:25:16,240 --> 00:25:18,919
Speaker 4: the future products around this family can do for Apple.

476
00:25:19,520 --> 00:25:23,280
Speaker 4: And it's that is investors are just looking at what

477
00:25:23,400 --> 00:25:25,840
Speaker 4: has happened over the past five years related to augment

478
00:25:25,920 --> 00:25:29,080
Speaker 4: reality and virtual reality and the disappointments. And I think

479
00:25:29,119 --> 00:25:33,119
Speaker 4: that this device is spatial computing. It's different, and I

480
00:25:33,200 --> 00:25:36,919
Speaker 4: think there is an opportunity for Apple to create a

481
00:25:36,920 --> 00:25:40,040
Speaker 4: device that we spend one to three hours a day

482
00:25:40,080 --> 00:25:43,239
Speaker 4: in and that can be ten plus percent of their

483
00:25:43,280 --> 00:25:45,439
Speaker 4: overall revenue. I think most investors think this is going

484
00:25:45,480 --> 00:25:47,040
Speaker 4: to be five percent of revenue. I think it can

485
00:25:47,080 --> 00:25:49,879
Speaker 4: be more. If I was going to say where I

486
00:25:49,880 --> 00:25:51,800
Speaker 4: could be wrong, I think that it could be much bigger.

487
00:25:51,800 --> 00:25:54,000
Speaker 4: It could be twenty percent. I mean, I think this

488
00:25:54,119 --> 00:25:58,680
Speaker 4: is one of those devices that people won't fully appreciate

489
00:25:58,720 --> 00:26:01,800
Speaker 4: until they've used it, and I think developers are going

490
00:26:01,800 --> 00:26:04,840
Speaker 4: to get on board. I don't think it's great for humanity.

491
00:26:05,359 --> 00:26:09,080
Speaker 4: I think because it's just such an immersive environment. Even

492
00:26:09,119 --> 00:26:11,399
Speaker 4: though you see the outside world, that's still immersive. But

493
00:26:11,480 --> 00:26:13,919
Speaker 4: Apple's going to build what I think is going to

494
00:26:13,920 --> 00:26:16,000
Speaker 4: be a big business around vision pro and investors are

495
00:26:16,040 --> 00:26:17,040
Speaker 4: going to get surprised in the.

496
00:26:16,920 --> 00:26:18,560
Speaker 5: Next few years. It's going to take a few years,

497
00:26:18,920 --> 00:26:19,960
Speaker 5: but I think it's going to happen.

498
00:26:20,600 --> 00:26:23,920
Speaker 1: Another megacap stock we haven't talked much about is Amazon.

499
00:26:24,040 --> 00:26:26,880
Speaker 1: Of course, they spent so much during the pandemic. They've

500
00:26:26,880 --> 00:26:29,920
Speaker 1: been trying to get past that. Dan, what's your view

501
00:26:30,119 --> 00:26:33,960
Speaker 1: on Amazon obviously one of the biggest megacap tech names

502
00:26:34,040 --> 00:26:34,639
Speaker 1: out there.

503
00:26:35,720 --> 00:26:38,320
Speaker 2: Look, I think the biggest thing missing right now, and

504
00:26:38,560 --> 00:26:41,640
Speaker 2: from an investador conversations, I'm sure Jeans had the time

505
00:26:42,200 --> 00:26:45,879
Speaker 2: as well. They are behind when it comes to AI.

506
00:26:46,400 --> 00:26:48,840
Speaker 2: I mean, if you look what Google and Currion have done,

507
00:26:49,720 --> 00:26:52,480
Speaker 2: are queerly Nedella and Redman at the top of the mountain.

508
00:26:52,800 --> 00:26:55,119
Speaker 2: I think from Amazon, it's really jazzy coming up with

509
00:26:55,200 --> 00:26:59,000
Speaker 2: a defined AI strategy. I think cloud is ultimately going

510
00:26:59,080 --> 00:27:01,480
Speaker 2: to be key from a some of the parts to

511
00:27:01,800 --> 00:27:04,800
Speaker 2: this stock moving higher. I had e commerce, you know,

512
00:27:04,840 --> 00:27:09,720
Speaker 2: obviously comms have gotten tougher and they'll lapters, but This

513
00:27:09,840 --> 00:27:11,760
Speaker 2: is really what I view from some of the parts

514
00:27:11,800 --> 00:27:16,720
Speaker 2: about that cloud story monetizing in AI, because right now Nadella,

515
00:27:17,480 --> 00:27:20,800
Speaker 2: he's starting to flex the muscles in Redmond. They're gaining

516
00:27:20,880 --> 00:27:23,879
Speaker 2: more and more share. You're seeing it from Google as well.

517
00:27:24,200 --> 00:27:27,240
Speaker 2: For the first time, they gotta They essentially have a

518
00:27:27,280 --> 00:27:28,320
Speaker 2: cage match going on.

519
00:27:28,600 --> 00:27:32,440
Speaker 1: Winter comes to Cloud, another cage match besides Elon Musk

520
00:27:32,480 --> 00:27:36,360
Speaker 1: and Mark Zuckerberg. Baby is Amazon getting a little bit

521
00:27:36,880 --> 00:27:39,320
Speaker 1: too far ahead in terms of where it is in

522
00:27:39,359 --> 00:27:41,919
Speaker 1: the cloud and maybe not paying as much attention to

523
00:27:41,960 --> 00:27:44,200
Speaker 1: some of that competition Gene.

524
00:27:44,280 --> 00:27:48,480
Speaker 4: I think there's probably some like natural benefits. Their cloud

525
00:27:48,520 --> 00:27:51,920
Speaker 4: business has been under so much pressure. If it just stabilizes,

526
00:27:51,960 --> 00:27:55,360
Speaker 4: I think investors will view that as a positive. I'm

527
00:27:55,400 --> 00:27:57,560
Speaker 4: not talking about the fundamentals. I'm talking about the stock here.

528
00:27:58,200 --> 00:28:00,320
Speaker 4: They probably will get a bump with some of this

529
00:28:00,440 --> 00:28:03,439
Speaker 4: AI spend and some of this AI infrastructure on their

530
00:28:03,480 --> 00:28:06,600
Speaker 4: cloud business. Amazon is going to go through a transition.

531
00:28:06,680 --> 00:28:08,720
Speaker 4: This is a fundamental piece over the next five years,

532
00:28:08,720 --> 00:28:12,639
Speaker 4: and it really is they're becoming more of a service

533
00:28:12,680 --> 00:28:16,120
Speaker 4: provider to their own retail business and to other retailers.

534
00:28:16,440 --> 00:28:19,840
Speaker 4: And they've talked more about kind of having opportunities for

535
00:28:19,880 --> 00:28:24,520
Speaker 4: their fleet to our traditional brick and mortar to our

536
00:28:24,560 --> 00:28:28,840
Speaker 4: delivery and AWS is an example fulfilled by Amazon. I

537
00:28:28,880 --> 00:28:31,520
Speaker 4: think that we're going to see this infrastructure kind of

538
00:28:31,600 --> 00:28:34,000
Speaker 4: become a bigger part of the story, very similar to

539
00:28:34,160 --> 00:28:37,119
Speaker 4: Apple is a products company and then the services became

540
00:28:37,119 --> 00:28:39,880
Speaker 4: a bigger part. I think infrastructure is going to be

541
00:28:39,880 --> 00:28:41,880
Speaker 4: a part of Amazon story over the next decade.

542
00:28:42,160 --> 00:28:45,800
Speaker 1: Gene Munster of Deepwater Asset Management, Dan Ives at web

543
00:28:45,800 --> 00:28:48,360
Speaker 1: Bush Securities stay with us. We're going to take a

544
00:28:48,440 --> 00:28:51,200
Speaker 1: last look at some of your best and worst tech

545
00:28:51,240 --> 00:28:53,680
Speaker 1: stock picks for the rest of twenty twenty three, as

546
00:28:53,720 --> 00:28:57,440
Speaker 1: a special high tech holiday edition of Bloomberg day Break continues.

547
00:28:57,600 --> 00:29:00,320
Speaker 1: It's fifty minutes past the hour. I'm Nathan Haig, and

548
00:29:00,440 --> 00:29:13,400
Speaker 1: this is Bloomberg. Welcome back to the special high Tech

549
00:29:13,520 --> 00:29:16,360
Speaker 1: edition of Bloomberg Daybreak for the fourth of July holiday.

550
00:29:16,400 --> 00:29:19,080
Speaker 1: I'm Nathan Hagar. The US stock market is closed for

551
00:29:19,120 --> 00:29:21,560
Speaker 1: Independence Day, and we are back with Dan Ives of

552
00:29:21,560 --> 00:29:25,360
Speaker 1: Webbish Securities, the senior equity analysts there. Gene Munster, managing

553
00:29:25,400 --> 00:29:28,080
Speaker 1: partner at Deepwater Asset Management, is with us as well.

554
00:29:28,120 --> 00:29:30,440
Speaker 1: We want to close this out guys, little bit of

555
00:29:30,440 --> 00:29:33,400
Speaker 1: a lightning round some of the best and worst performing

556
00:29:33,440 --> 00:29:35,640
Speaker 1: tech stocks that you're looking at through the rest of

557
00:29:35,680 --> 00:29:37,960
Speaker 1: twenty twenty three. Geene, let's start with you. What do

558
00:29:38,000 --> 00:29:39,600
Speaker 1: you think are going to be a couple of the

559
00:29:39,680 --> 00:29:42,640
Speaker 1: standouts and maybe a couple of the laggards this year.

560
00:29:42,960 --> 00:29:48,400
Speaker 4: On the standout side, it's Google still not getting the.

561
00:29:47,280 --> 00:29:49,000
Speaker 5: Credit what they've done in AI.

562
00:29:49,080 --> 00:29:51,400
Speaker 4: Remember in twenty seventeen they said they're an AI first

563
00:29:51,400 --> 00:29:53,720
Speaker 4: company of some of the smartest people on it. Yes,

564
00:29:53,760 --> 00:29:55,720
Speaker 4: there's going to be some sort of a bump in

565
00:29:55,760 --> 00:29:57,640
Speaker 4: the world related to their revenue, but I think we

566
00:29:57,720 --> 00:29:59,440
Speaker 4: haven't even seen the beginning of what they're going to

567
00:29:59,480 --> 00:30:01,920
Speaker 4: do in AI. So I put Google at the top,

568
00:30:01,960 --> 00:30:05,280
Speaker 4: and then I would put just kind of a surprise,

569
00:30:06,960 --> 00:30:09,560
Speaker 4: put Apple in there. I think vision Pro is one

570
00:30:09,600 --> 00:30:12,040
Speaker 4: that is going to surprise investors over the next few years.

571
00:30:12,040 --> 00:30:15,360
Speaker 4: And a third one, a much smaller one, is Zillo.

572
00:30:15,800 --> 00:30:19,480
Speaker 4: So Zillo is a it's a twelve billion dollar market cap,

573
00:30:19,960 --> 00:30:24,959
Speaker 4: the zestiment is busted, the commer residential real estate market

574
00:30:25,000 --> 00:30:28,520
Speaker 4: is massive, and they can use AI to finally fix

575
00:30:28,600 --> 00:30:31,880
Speaker 4: the estimate. I think that's going to benefit Zillo and

576
00:30:31,880 --> 00:30:34,480
Speaker 4: on the ones that we're a little bit more cautious

577
00:30:34,520 --> 00:30:39,240
Speaker 4: on were investors in ubers. So we're negative on Lift.

578
00:30:39,240 --> 00:30:41,400
Speaker 4: They've obviously had some problems. Don't want to pile on that,

579
00:30:41,440 --> 00:30:43,040
Speaker 4: but I'll put Lift in that category.

580
00:30:43,640 --> 00:30:46,760
Speaker 1: Dan, I heard Gene mentioned Apple there, know how you

581
00:30:46,760 --> 00:30:48,720
Speaker 1: feel about Apple? Is that on top of your list

582
00:30:48,720 --> 00:30:49,080
Speaker 1: as well?

583
00:30:49,760 --> 00:30:53,840
Speaker 2: Well? I mean iView that as a table pounder. I mean,

584
00:30:53,840 --> 00:30:56,440
Speaker 2: in my opinion, we see that going to a four

585
00:30:56,520 --> 00:31:00,480
Speaker 2: trillion dollar mark cap by twenty five. Some of the

586
00:31:00,520 --> 00:31:04,960
Speaker 2: parts services that's worth one point three trillion. Apple and

587
00:31:05,080 --> 00:31:08,440
Speaker 2: Microsoft to me are the table pounders here, along with

588
00:31:08,520 --> 00:31:12,440
Speaker 2: Tessa because of the growth themes that are going on

589
00:31:12,680 --> 00:31:15,640
Speaker 2: for Cloud, Microsoft and the Della continues to be the

590
00:31:15,680 --> 00:31:19,040
Speaker 2: core Cloud and AI name the names right now, if

591
00:31:19,080 --> 00:31:23,280
Speaker 2: you looked up disaster in the dictionary, you'd see the

592
00:31:23,400 --> 00:31:28,520
Speaker 2: tickers Lift and Snap. Those are names under new circumstance,

593
00:31:28,600 --> 00:31:33,040
Speaker 2: would I focus on despite maybe the stocks that have

594
00:31:33,040 --> 00:31:35,120
Speaker 2: obviously sold off significant.

595
00:31:35,200 --> 00:31:38,600
Speaker 1: Interesting to hear Snap in that category given some of

596
00:31:38,640 --> 00:31:42,760
Speaker 1: the continued difficulty we're seeing in the ad space as well.

597
00:31:43,080 --> 00:31:45,680
Speaker 1: Just to take a little bit of a broader view here,

598
00:31:45,720 --> 00:31:49,400
Speaker 1: we came into twenty twenty three, thinking that tech was

599
00:31:49,440 --> 00:31:52,360
Speaker 1: going to have it tough. Obviously, that has not panned

600
00:31:52,400 --> 00:31:55,440
Speaker 1: out in a big way. Gene, why do you think

601
00:31:55,480 --> 00:31:59,120
Speaker 1: the downbeat view on tech that began this year didn't

602
00:31:59,160 --> 00:32:02,080
Speaker 1: fail the material or did fail to materialize.

603
00:32:02,480 --> 00:32:06,600
Speaker 4: I think two things happen. One is Chat gpt fastest

604
00:32:06,600 --> 00:32:09,360
Speaker 4: growing product ever. They've got a billion users after six months.

605
00:32:09,640 --> 00:32:12,720
Speaker 4: Nothing's even come close to that, and I think that's

606
00:32:13,160 --> 00:32:16,760
Speaker 4: reminded investors that innovation is alive and well with owning tech.

607
00:32:17,280 --> 00:32:20,719
Speaker 4: And second is the investors saw that the rates are

608
00:32:20,720 --> 00:32:22,880
Speaker 4: going to slow, the hikes are going to slow, doesn't

609
00:32:22,880 --> 00:32:24,680
Speaker 4: matter if they go down, they just need to slow

610
00:32:24,720 --> 00:32:28,280
Speaker 4: and stop. And I think that was the hammer that

611
00:32:28,400 --> 00:32:30,240
Speaker 4: was down on these tech stocks. And as soon as

612
00:32:30,240 --> 00:32:33,080
Speaker 4: investors started to get comfort that they weren't going to

613
00:32:33,080 --> 00:32:35,840
Speaker 4: go up in infinity, the stocks started to go higher.

614
00:32:36,280 --> 00:32:40,000
Speaker 1: Obviously, Dan, you've been bullish on tech for so long here,

615
00:32:40,120 --> 00:32:44,000
Speaker 1: you've followed the sector for so many years. What is

616
00:32:44,040 --> 00:32:47,520
Speaker 1: the biggest risk to your bull view on tech stocks

617
00:32:47,520 --> 00:32:50,280
Speaker 1: as we look ahead to the rest of twenty twenty three.

618
00:32:50,800 --> 00:32:53,800
Speaker 2: I think it's more just geopolitical, you know. I think

619
00:32:53,840 --> 00:32:56,760
Speaker 2: the China situation in terms of just what we see

620
00:32:56,800 --> 00:32:59,360
Speaker 2: there from a supply chain, and you know, any sort

621
00:32:59,400 --> 00:33:05,120
Speaker 2: of more noise between DC and Beijing, although that's offtening. Look,

622
00:33:05,160 --> 00:33:07,400
Speaker 2: I think the FEDS weave the white flag despite all

623
00:33:07,440 --> 00:33:10,400
Speaker 2: the tough talk this poker game, that they're essentially done

624
00:33:10,480 --> 00:33:13,720
Speaker 2: eighth ninth inning. In my view, it is a green

625
00:33:13,800 --> 00:33:15,720
Speaker 2: light to own tech, and I believe we're at the

626
00:33:15,760 --> 00:33:18,640
Speaker 2: start of what's the next bullmarket in tech.

627
00:33:18,880 --> 00:33:21,640
Speaker 1: We'll leave it there. Thanks so much for joining us

628
00:33:21,640 --> 00:33:25,040
Speaker 1: for the full hour here Gene Munster, managing partner in

629
00:33:25,080 --> 00:33:29,200
Speaker 1: Deepwater Asset Management and web Bush Security Senior equity analyst

630
00:33:29,400 --> 00:33:33,120
Speaker 1: Dan Ives giving us the view on tech stocks as

631
00:33:33,120 --> 00:33:35,880
Speaker 1: we head into the rest of this twenty twenty three

632
00:33:36,320 --> 00:33:38,720
Speaker 1: and a special thanks to you as well for being

633
00:33:38,720 --> 00:33:42,840
Speaker 1: with us on this special edition of Bloomberg Daybreak. Hope

634
00:33:42,880 --> 00:33:46,000
Speaker 1: you enjoyed the fourth of July holiday and stay with us.

635
00:33:46,280 --> 00:33:50,400
Speaker 1: Today's top stories and global business headlines are coming up

636
00:33:51,160 --> 00:33:54,760
Speaker 1: right now.