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Speaker 1: Let's get to Carol Pepper, founder and CEO at Pepper International. So, Carol, earnings,

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Speaker 1: the elections, and the crypto space, all that delivering kind

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Speaker 1: of a heavy blow today, but it may not really

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Speaker 1: matter much as the CPI report looms here. I know

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Speaker 1: you're not a day trader, Um, but you know, given

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Speaker 1: the importance of this, is it your sense that this

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Speaker 1: report will be friendly to markets or not so friendly? Um?

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Speaker 1: I think it's going to be a little more friendly

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Speaker 1: and it'll be a bit of a relief rally after today.

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Speaker 1: I do think things are moderating. This is absolutely what

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Speaker 1: we've thought would happen. You know, supply chains are easing,

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Speaker 1: housing starts are down. The Fed has done its work.

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Speaker 1: One hopes that they'll be able to start slowing the

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Speaker 1: rate of increases or you know, just increase fifty basis

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Speaker 1: points instead of so. Yes, I think it will be

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Speaker 1: um a welcome report tomorrow. That's my prediction. I could

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Speaker 1: be wrong, of course, I've got a and toss of

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Speaker 1: a chance of being right. Carol. Okay, I mean you

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Speaker 1: talk about supply chains and easing, these are things which

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Speaker 1: would have happened irrespective of the Federal Reserve. So you should.

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Speaker 1: The Federal Reserve will be looking at all this. And

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Speaker 1: if you look at let's say, and they pulled to

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Speaker 1: rivals in terms of cargo, that's plummeted, and you know

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Speaker 1: there's no there's no such thing as a bottleneck there.

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Speaker 1: So perhaps they're more and more in danger of a

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Speaker 1: policy mistake. Well, I hope that they're. You know, they're

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Speaker 1: they're trying to be careful. They try to be thoughtful. Um.

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Speaker 1: I think they've they've signaled to the market very strongly

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Speaker 1: that they're going to be firm, and they're taking inflation seriously,

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Speaker 1: and hopefully the talking will be enough so that we

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Speaker 1: won't have to get a lot more over raising. If

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Speaker 1: you will, I agree with you. I don't think, uh,

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Speaker 1: it's it's going to be necessary to continue to punishing

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Speaker 1: lee raise rates in order to get the economy under control,

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Speaker 1: because things are naturally starting to get a bit better.

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Speaker 1: This will sound a little glib, but they got more

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Speaker 1: than twenty people working at if IT, and no doubt

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Speaker 1: a thousand of them or something like that have pH

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Speaker 1: d s. And you think that they are looking at

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Speaker 1: a lot more and can be a lot more nuanced

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Speaker 1: than just reading a CPI report. Well, I'm I'm sure

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Speaker 1: they are, um, but I'm sure it's much more complicated

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Speaker 1: than than They're never gonna be able to try to

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Speaker 1: explain to the general public in their minutes. It's etcetera. UM.

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Speaker 1: I do think that they're very thoughtful. I don't think

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Speaker 1: they've done a terrible job in any sense. And I'm

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Speaker 1: personally quite optimistic. I think, for example, we're gonna have

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Speaker 1: a nice Christmas season, a nice holiday season. I'm personally

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Speaker 1: thinking that it'll be a good Black Friday sales season.

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Speaker 1: People may be trading down and buying perhaps less expensive

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Speaker 1: goods due to inflation and you know, higher gas and

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Speaker 1: food prices. But I don't think we're going to see

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Speaker 1: the consumer stopping spending, which of course is a big

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Speaker 1: part of the engine in the United States. Carol, I

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Speaker 1: guess the way you see the economy panning out is

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Speaker 1: really also something which is the prism within which you

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Speaker 1: actually look at what you are buying and selling at

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Speaker 1: the moment. So what is your view of what happens

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Speaker 1: with the economy and what you suggest we stay away

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Speaker 1: from and what we actually perhaps buy. Yes, well, I

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Speaker 1: think that we're going to have sort of a moderate

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Speaker 1: middle of the road situation. I don't think we're going

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Speaker 1: to have anything terribly extreme, you know, barring some sort

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Speaker 1: of a nuclear disaster from the war, but let's take

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Speaker 1: that off the table. I don't think that's very likely.

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Speaker 1: So in this case, I think you want to look

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Speaker 1: for things that will do well in a in a

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Speaker 1: jittery market, and things that do well when consumers are

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Speaker 1: a bit pinched by inflation. So what does that mean

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Speaker 1: on the consumer side, I think you go for Amazon,

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Speaker 1: people will still be buying for the Christmas season. You

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Speaker 1: look at xl Y to get that broader consumer exposure,

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Speaker 1: and go for less expensive experiences like Yum or McDonald's

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Speaker 1: where consumers can have a nice evening app but not

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Speaker 1: pay too much money. I think the you gotta be

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Speaker 1: kidding me, A nice a nice evening to Yum that's hilarious. Yeah, well,

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Speaker 1: you know, for for some consumers, that's better than you know,

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Speaker 1: when when gases as high it is and food is high,

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Speaker 1: it's better to go out to something or lower your story.

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Speaker 1: Let me ask you a big picture story. Can we

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Speaker 1: read the mid terms as voters saying that we're actually okay,

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Speaker 1: we we don't really need some strong medicine. Yes, I

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Speaker 1: think that what the voice of moderation, the voice of

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Speaker 1: the middle of the road voter has spoken. I think

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Speaker 1: the extreme and fringe candidates are being properly viewed with disdain.

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Speaker 1: Election denial is being viewed properly with disdain from most

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Speaker 1: of the country. And I think people want their voting

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Speaker 1: rights and women want the rights over their bodies full stop, um.

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Speaker 1: And so if you're willing to get more towards the

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Speaker 1: middle of the spectrum, I think that's that's where the

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Speaker 1: majority of the country is. It's not out on the fringe. Unfortunately,

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Speaker 1: the fringe gets the news and that distorts our picture

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Speaker 1: globally for people overseas about what's going on here. But

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Speaker 1: the truth is it's a pretty moderate electorate and that's

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Speaker 1: that's who spoke. And I think that people just want

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Speaker 1: to have a nice life, you know, have their rights respected,

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Speaker 1: or money to care their families and enjoy a nice existence.

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Speaker 1: I think that's really what what the midterms told us. Yeah, exactly,

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Speaker 1: So in other words, stay the course, don't panic, perhaps

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Speaker 1: stay where you are in terms of your essetonication as well. Yeah,

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Speaker 1: I mean, you know, energy will continue to be a

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Speaker 1: strong area to make money over the next couple of years.

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Speaker 1: I think also this work from home or hybrid work

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Speaker 1: and the replacement of physical you know, sort of repetitive

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Speaker 1: physical labor with automation and robotics will continue. So those

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Speaker 1: are the trends, you know, the trends that are happening

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Speaker 1: or the trends that will continue to happen. And that's

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Speaker 1: where you'll make money. Um. You know, very overpriced streaming

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Speaker 1: services will not do well. They're going to have to

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Speaker 1: lower their costs, their prices for example. Yeah, I can

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Speaker 1: imagine some people are saying, if I never see a

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Speaker 1: stock again, it'll be too soon with this casino like behavior.

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Speaker 1: And and it's really a lot of pretty normal companies

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Speaker 1: like Meta printing money. I mean, the profits are still high,

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Speaker 1: stock down from the highs, and carbona down. How do

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Speaker 1: we justify that, how do we reconcile that? Well? I

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Speaker 1: think again, you know, Meta try. I think sometimes remember

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Speaker 1: the dot com you know, there were stocks that flew

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Speaker 1: extremely high and then crashed almost nothing, And it took

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Speaker 1: about fifteen years for the let's just say the Internet

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Speaker 1: as a sector to become something normal and profitable. I

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Speaker 1: think the metaverse, if you will. We're far ahead of

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Speaker 1: ourselves on that um, but they'll they'll be probably more

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Speaker 1: than one crash before the metaverse becomes something that actually

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Speaker 1: can make money. And so you know, I think um

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Speaker 1: Zuckerberg was trying to be ahead, and unfortunately doing that

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Speaker 1: in a public company is difficult. He might be better

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Speaker 1: off taking me the metaverse part of Facebook out and

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Speaker 1: starting something private with that, frankly, rather than trying to

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Speaker 1: do that in a public market. Carol, of course he

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Speaker 1: does have all the voting shares, but thank you so

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Speaker 1: much for joining us. That is Carol Pepper from Pepper International,

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Speaker 1: joining us with her taker on the market