1 00:00:00,400 --> 00:00:03,600 Speaker 1: Strap on your parachute. It is time for What Goes 2 00:00:03,680 --> 00:00:13,720 Speaker 1: Up with Sarah Ponziic and Mike Reagan. Hello and welcome 3 00:00:13,720 --> 00:00:16,880 Speaker 1: to What goes Up, a Bloomberg Weekly markets podcast. I'm 4 00:00:16,880 --> 00:00:20,080 Speaker 1: Sarah Pons, reporter on the Cross Asset team, and I'm 5 00:00:20,120 --> 00:00:23,360 Speaker 1: Mike Reagan, a senior editor at Bloomberg. This week on 6 00:00:23,400 --> 00:00:26,400 Speaker 1: the show, we are less than three weeks away from 7 00:00:26,440 --> 00:00:28,800 Speaker 1: election day. It's hard to believe, but in the lead 8 00:00:28,880 --> 00:00:31,760 Speaker 1: up there's been many narratives offered regarding what the market 9 00:00:31,840 --> 00:00:35,120 Speaker 1: is pricing in a blue sweep, something else, and also 10 00:00:35,200 --> 00:00:38,560 Speaker 1: advice offered on what investors should do in different outcomes 11 00:00:38,800 --> 00:00:42,000 Speaker 1: should you listen to them. Our guestways in, and as always, 12 00:00:42,080 --> 00:00:44,920 Speaker 1: we will close out the episode with our tradition the 13 00:00:44,960 --> 00:00:48,519 Speaker 1: craziest thing I saw in markets this week, So I 14 00:00:48,600 --> 00:00:51,400 Speaker 1: want to introduced a new tradition too, and that is 15 00:00:51,400 --> 00:00:53,400 Speaker 1: an update on your puppy. I think I think we 16 00:00:53,440 --> 00:00:56,160 Speaker 1: need to know how the Golden Doodle is doing. You know, 17 00:00:56,320 --> 00:01:00,240 Speaker 1: the last two nights she slept soundly through the entire night, 18 00:01:00,760 --> 00:01:04,160 Speaker 1: So big props to her, but also very exciting for 19 00:01:04,200 --> 00:01:06,320 Speaker 1: me because certainly, if I was going to give you 20 00:01:06,400 --> 00:01:08,280 Speaker 1: an update I'd say the first three nights I was 21 00:01:08,840 --> 00:01:12,480 Speaker 1: very sleep deprived and up every couple hours with a 22 00:01:12,560 --> 00:01:16,240 Speaker 1: whining puppy. But she's doing great. She's getting acclimated um 23 00:01:16,280 --> 00:01:18,640 Speaker 1: to the city, as acclimated as you can get after 24 00:01:18,760 --> 00:01:22,400 Speaker 1: coming off of a farm in Pennsylvania. Well, well, good 25 00:01:22,400 --> 00:01:25,240 Speaker 1: news that you're well arrested. How many shoes has she destroyed? 26 00:01:25,720 --> 00:01:29,080 Speaker 1: What's the tally? Surprisingly not many. She's still scared of 27 00:01:29,120 --> 00:01:31,280 Speaker 1: shoes at this point in time. The little game we 28 00:01:31,319 --> 00:01:32,960 Speaker 1: play is I put on my sneaker so she can't 29 00:01:32,959 --> 00:01:35,400 Speaker 1: bite my toes and chase her around the apartment because 30 00:01:35,440 --> 00:01:37,560 Speaker 1: it gets her to run um since she's scared of 31 00:01:37,560 --> 00:01:39,760 Speaker 1: shoes if I have them on my feet. So no, 32 00:01:39,760 --> 00:01:42,679 Speaker 1: no shoes eaten yet. That's a that's a success. That's 33 00:01:42,720 --> 00:01:45,039 Speaker 1: pretty good. That's a good, good strategy you got there. 34 00:01:45,760 --> 00:01:48,120 Speaker 1: And speaking of strategy, see what I did there? I 35 00:01:48,200 --> 00:01:50,440 Speaker 1: see what you did there. We're very happy to have 36 00:01:50,600 --> 00:01:53,320 Speaker 1: one of the best there is. Uh. Her name is 37 00:01:53,400 --> 00:01:57,600 Speaker 1: Lizzen Saunders. She's the chief investment strategist at Charles schwab 38 00:01:58,000 --> 00:01:59,720 Speaker 1: Lisen And welcome back to the show. It's been a while. 39 00:01:59,760 --> 00:02:02,960 Speaker 1: I don't think we've talked since all the craziness started it. 40 00:02:03,160 --> 00:02:07,200 Speaker 1: How are you faring during lockdown? Faring fairly well? Thank 41 00:02:07,240 --> 00:02:09,280 Speaker 1: you and thanks for having me again. I think you're right. 42 00:02:09,320 --> 00:02:12,359 Speaker 1: I think it was pre pandemic, right. How things have 43 00:02:12,480 --> 00:02:15,480 Speaker 1: changed in the in less than a year. Indeed, so Listte, 44 00:02:15,480 --> 00:02:18,480 Speaker 1: I was reading one of your recent commentaries, you know 45 00:02:18,800 --> 00:02:21,720 Speaker 1: about uh, sort of the way to look at the 46 00:02:21,760 --> 00:02:24,640 Speaker 1: market with the election coming up. It's funny, but you know, 47 00:02:24,680 --> 00:02:27,320 Speaker 1: as journalists and strategists, I think we're both sort of 48 00:02:27,320 --> 00:02:30,480 Speaker 1: forced to to fit the election into our world view, 49 00:02:30,520 --> 00:02:33,520 Speaker 1: whether we like it or not. But what really stuck 50 00:02:33,560 --> 00:02:36,280 Speaker 1: out to me is a few lines you had about, 51 00:02:36,320 --> 00:02:39,240 Speaker 1: you know, obviously the old standard boiler plate that past 52 00:02:39,280 --> 00:02:42,359 Speaker 1: returns or no guarantee of future results, and and how 53 00:02:42,480 --> 00:02:47,440 Speaker 1: in this election, particularly in this economic environment, history probably 54 00:02:47,560 --> 00:02:50,640 Speaker 1: is not as much of a guide as it perhaps 55 00:02:50,680 --> 00:02:52,840 Speaker 1: we would like it to be. Um. So I'm just 56 00:02:52,919 --> 00:02:55,520 Speaker 1: curious how you're looking at the you know, the election. 57 00:02:55,639 --> 00:02:58,440 Speaker 1: Is there a danger of people sort of focusing too 58 00:02:58,520 --> 00:03:01,840 Speaker 1: much on the horse race and what it means for markets? 59 00:03:01,919 --> 00:03:04,440 Speaker 1: Is that is that something that you know you worry 60 00:03:04,440 --> 00:03:08,000 Speaker 1: about clients a schwab sort of worrying a little too 61 00:03:08,080 --> 00:03:10,640 Speaker 1: much about what's going to happen in November and less 62 00:03:10,680 --> 00:03:14,320 Speaker 1: about the bigger sort of fundamentals and trends coming up 63 00:03:14,320 --> 00:03:16,400 Speaker 1: in the next year. I do worry about it a 64 00:03:16,400 --> 00:03:18,880 Speaker 1: little bit, and and that's partly due to the fact 65 00:03:18,960 --> 00:03:23,520 Speaker 1: that the most common version of an election related question 66 00:03:23,600 --> 00:03:27,240 Speaker 1: I get as it relates to markets is should I 67 00:03:27,320 --> 00:03:31,200 Speaker 1: get out now, go to cash, and then put my 68 00:03:31,280 --> 00:03:34,920 Speaker 1: money back in after the election when and I'll hear, 69 00:03:35,040 --> 00:03:38,800 Speaker 1: you know, the inevitable volatility dies down. And I would 70 00:03:38,840 --> 00:03:42,240 Speaker 1: say this in any environment and not just specific to 71 00:03:42,280 --> 00:03:45,840 Speaker 1: an election. Um, get in and get out are not 72 00:03:45,920 --> 00:03:49,680 Speaker 1: investing strategies. That's gambling on a moment in time. In 73 00:03:49,720 --> 00:03:52,760 Speaker 1: this case, it would be gambling on some perceived election outcome, 74 00:03:52,800 --> 00:03:55,800 Speaker 1: good or bad, and that's not investing. Investing should always 75 00:03:55,800 --> 00:03:58,400 Speaker 1: be a process over time. And I think, well, it's 76 00:03:58,480 --> 00:04:02,080 Speaker 1: human nature to say, if X happens, then why is 77 00:04:02,120 --> 00:04:05,240 Speaker 1: going to happen and try to connect dots between a 78 00:04:05,440 --> 00:04:10,600 Speaker 1: variable election, economic earnings, valuation, whatever it is, and what 79 00:04:10,720 --> 00:04:13,120 Speaker 1: the market has been doing or is going to do. 80 00:04:13,360 --> 00:04:16,320 Speaker 1: And wouldn't it be lovely if life was as easy 81 00:04:16,320 --> 00:04:19,600 Speaker 1: as that? And it isn't, so, uh, you know, there. 82 00:04:19,600 --> 00:04:22,719 Speaker 1: There are certainly strategies that individuals might want to employ 83 00:04:22,800 --> 00:04:25,440 Speaker 1: if they really feel like they want to limit any 84 00:04:25,520 --> 00:04:29,040 Speaker 1: kind of downside. So there's hedging strategies that can be done. 85 00:04:29,080 --> 00:04:32,200 Speaker 1: But the whole get out now and then get back 86 00:04:32,240 --> 00:04:36,240 Speaker 1: in that that's not a strategy. So stay invested. I'm 87 00:04:36,279 --> 00:04:38,680 Speaker 1: curious what you think of some of these narratives that 88 00:04:38,720 --> 00:04:41,240 Speaker 1: I alluded to that have been floating around that part 89 00:04:41,279 --> 00:04:43,400 Speaker 1: of the reason that we have seen the market to 90 00:04:43,480 --> 00:04:46,320 Speaker 1: return to resiliency is the fact that it is pricing 91 00:04:46,320 --> 00:04:48,560 Speaker 1: in a blue sweep. What that means is we could 92 00:04:48,560 --> 00:04:51,680 Speaker 1: see trillions of dollars worth of fiscal stimulus down the 93 00:04:51,720 --> 00:04:55,200 Speaker 1: pipes that could then lead to a rotation to small 94 00:04:55,240 --> 00:04:59,400 Speaker 1: caps or value. Do you buy these narratives? I mean, like, 95 00:04:59,400 --> 00:05:03,359 Speaker 1: like Mike said, as journalists also um sometimes as a 96 00:05:03,440 --> 00:05:06,599 Speaker 1: strategist or investors will look at the market and try 97 00:05:06,800 --> 00:05:10,400 Speaker 1: to assign a narrative or backfit a narrative to anything 98 00:05:10,440 --> 00:05:12,719 Speaker 1: we are seeing. Is it possible to actually go ahead 99 00:05:12,760 --> 00:05:15,080 Speaker 1: and say, sure, yeah, this is what the markets pricing 100 00:05:15,120 --> 00:05:17,440 Speaker 1: in or is this just a market that happens to 101 00:05:17,480 --> 00:05:21,520 Speaker 1: be rallying for any any which reason? And this is 102 00:05:21,520 --> 00:05:23,920 Speaker 1: what people are deciding the narrative is considering how close 103 00:05:23,920 --> 00:05:26,320 Speaker 1: we are to an election. To your point, Sarah, it 104 00:05:26,440 --> 00:05:29,720 Speaker 1: is impossible to quantify, particularly if you're actually talking about 105 00:05:29,760 --> 00:05:32,240 Speaker 1: a narrative, and even if you believe in your heart 106 00:05:32,320 --> 00:05:35,120 Speaker 1: that that is the underlying force behind what the market 107 00:05:35,200 --> 00:05:39,000 Speaker 1: is doing, actually being precise about the impact it's having 108 00:05:39,040 --> 00:05:41,479 Speaker 1: and how much is priced in. But I don't think 109 00:05:41,480 --> 00:05:43,920 Speaker 1: it's a stretch to say and call it a narrative, 110 00:05:43,960 --> 00:05:47,240 Speaker 1: call it an actual infusion of liquidity, but that the 111 00:05:47,880 --> 00:05:54,680 Speaker 1: liquidity slash, fiscal the monetary fiscal combination, stimulus relief, whatever 112 00:05:55,040 --> 00:05:57,320 Speaker 1: term you want to use, I think has been a 113 00:05:57,360 --> 00:06:03,680 Speaker 1: powerful force um underpinning stocks. Not necessarily on any given 114 00:06:04,200 --> 00:06:06,880 Speaker 1: day or week, but I think that has been an 115 00:06:06,880 --> 00:06:10,039 Speaker 1: important story because in an environment, particularly when we were 116 00:06:10,040 --> 00:06:12,240 Speaker 1: in the heart of the pandemic, the entire economy was 117 00:06:12,279 --> 00:06:16,599 Speaker 1: shut down, we had the FED doing unprecedented things UH 118 00:06:16,640 --> 00:06:20,320 Speaker 1: and Congress doing unprecedented things, particularly in both the concept 119 00:06:20,320 --> 00:06:24,560 Speaker 1: of size and scope. That money has to go somewhere, 120 00:06:24,800 --> 00:06:27,520 Speaker 1: and in the absence of an economy that's humming along, 121 00:06:28,400 --> 00:06:31,680 Speaker 1: that money either can just stay in the pockets of 122 00:06:31,760 --> 00:06:36,000 Speaker 1: individuals or stay in the financial system or find its 123 00:06:36,040 --> 00:06:38,839 Speaker 1: way into asset markets, and that is clearly what happened, 124 00:06:38,880 --> 00:06:41,680 Speaker 1: and I think more recently, yeah, I think from a 125 00:06:41,800 --> 00:06:46,080 Speaker 1: macro perspective, the idea of more on the fiscal side 126 00:06:46,120 --> 00:06:50,080 Speaker 1: and potentially a larger sum of that in the event 127 00:06:50,160 --> 00:06:52,719 Speaker 1: of a Biden win relative to the size of the 128 00:06:52,760 --> 00:06:56,919 Speaker 1: package currently being negotiated, could be an underpinning. But the 129 00:06:57,000 --> 00:07:00,240 Speaker 1: reality is this market is largely being driven by a 130 00:07:00,279 --> 00:07:04,000 Speaker 1: small handful of stocks being traded by, in many cases, 131 00:07:04,080 --> 00:07:07,359 Speaker 1: really small investors. So that's not a narrative, that's the 132 00:07:07,440 --> 00:07:10,320 Speaker 1: actual mechanics to some degree of what's happening. I'm not 133 00:07:10,360 --> 00:07:15,720 Speaker 1: sure that cohort is necessarily focused on the big picture, um, 134 00:07:15,760 --> 00:07:19,679 Speaker 1: you know, monetary fiscal they're just you know, chasing momentum stocks. 135 00:07:19,920 --> 00:07:22,640 Speaker 1: So it's a combination, you know. Listen, that's a great 136 00:07:22,680 --> 00:07:24,720 Speaker 1: point about the sort of the return of the day 137 00:07:24,760 --> 00:07:28,120 Speaker 1: trader and the and the small dollar trader. Um. You know, 138 00:07:28,200 --> 00:07:31,560 Speaker 1: I would have to assume that the move to commission 139 00:07:31,600 --> 00:07:37,800 Speaker 1: free trading is somehow amplifying that. Uh that phenomenon does 140 00:07:37,840 --> 00:07:41,680 Speaker 1: that make it sort of harder for you to sort 141 00:07:41,680 --> 00:07:44,360 Speaker 1: of figure out where the market's going, what's going to 142 00:07:44,440 --> 00:07:47,960 Speaker 1: happen next, You know, is that now that we're almost dominated, 143 00:07:48,000 --> 00:07:51,360 Speaker 1: I think retail investors are I was looking at some 144 00:07:51,440 --> 00:07:54,920 Speaker 1: numbers from Larry tab or are Bloomberg intelligence analysts who 145 00:07:54,960 --> 00:07:58,320 Speaker 1: digs into market structure. It's one of the biggest cohorts 146 00:07:58,360 --> 00:08:01,320 Speaker 1: of investors and traders right now. I think retail mom 147 00:08:01,320 --> 00:08:04,520 Speaker 1: and pop traders actually rival hedge funds for as far 148 00:08:04,520 --> 00:08:07,800 Speaker 1: as how much volume is is attributed attributable to them 149 00:08:07,800 --> 00:08:11,520 Speaker 1: in the market. You know, I worry is is that 150 00:08:11,800 --> 00:08:15,720 Speaker 1: retail trader base sort of a fickle and hard to 151 00:08:16,200 --> 00:08:19,680 Speaker 1: analyze investor base, And what does that mean going forward 152 00:08:19,720 --> 00:08:22,080 Speaker 1: in the market? Is it sort of a recipe for 153 00:08:22,240 --> 00:08:24,560 Speaker 1: either I don't know, higher sort of a higher plateau 154 00:08:24,680 --> 00:08:28,720 Speaker 1: evaluations were or could we expect sort of more volatility 155 00:08:28,800 --> 00:08:31,520 Speaker 1: as a result of of you know, sort of smaller 156 00:08:31,520 --> 00:08:35,440 Speaker 1: traders chasing the momentum or maybe perhaps even chasing it 157 00:08:35,480 --> 00:08:37,319 Speaker 1: on the way down if they if they're so inclined 158 00:08:37,360 --> 00:08:39,679 Speaker 1: to to start shorting the market. Um is is that 159 00:08:40,600 --> 00:08:42,400 Speaker 1: I know this is a twelve part question which is 160 00:08:42,440 --> 00:08:46,040 Speaker 1: my my specialty, but but how does how does this 161 00:08:46,280 --> 00:08:50,480 Speaker 1: sort of up and coming group of traders dominating volume 162 00:08:50,880 --> 00:08:53,480 Speaker 1: affect the way the market operates and how you're how 163 00:08:53,480 --> 00:08:56,679 Speaker 1: you're watching and sort of analyzing what's going on. I mean, 164 00:08:56,679 --> 00:08:58,680 Speaker 1: the short answer is, we don't know, because this is 165 00:08:58,679 --> 00:09:01,200 Speaker 1: a cohort of traders that are brand new, so we 166 00:09:01,240 --> 00:09:03,840 Speaker 1: don't have a long history. Now they're they're part of 167 00:09:03,880 --> 00:09:07,640 Speaker 1: a larger cohort of course, retail investors. But this sort 168 00:09:07,640 --> 00:09:10,880 Speaker 1: of what I've been calling newly minted day traders um 169 00:09:10,960 --> 00:09:16,880 Speaker 1: largely trading via apps and more recently moving to a 170 00:09:16,920 --> 00:09:22,079 Speaker 1: significant degree into the options market, into call short dated 171 00:09:22,160 --> 00:09:26,000 Speaker 1: call buying, naked call buying. And so we don't yet 172 00:09:26,400 --> 00:09:30,360 Speaker 1: have any history of this cohort in terms of what 173 00:09:30,559 --> 00:09:35,400 Speaker 1: any negative market action might do to that cohort, because 174 00:09:35,600 --> 00:09:40,000 Speaker 1: most of the dominance of that cohort started in the 175 00:09:40,120 --> 00:09:43,200 Speaker 1: late March early April time frame, and there were many 176 00:09:43,400 --> 00:09:47,760 Speaker 1: ingredients to the recipe that of of this power of 177 00:09:47,800 --> 00:09:53,079 Speaker 1: this small retail trader. You mentioned zero percent commissions, Um, 178 00:09:53,160 --> 00:09:58,880 Speaker 1: we a chub might have had something perfectly so maybe 179 00:09:59,040 --> 00:10:02,400 Speaker 1: just you know, maybe I seem to recall we said 180 00:10:02,440 --> 00:10:05,400 Speaker 1: something about that. And then of course for actional shares, 181 00:10:06,080 --> 00:10:10,520 Speaker 1: and then the combination of pandemic related forces, people being 182 00:10:10,600 --> 00:10:15,200 Speaker 1: home doing much more on their digital devices. Uh, no 183 00:10:15,760 --> 00:10:19,439 Speaker 1: sports betting for quite some time, So I think it 184 00:10:19,600 --> 00:10:23,960 Speaker 1: was just this tsunami of things that happened to really 185 00:10:24,960 --> 00:10:29,840 Speaker 1: bring out this new form of trader. Now, what we 186 00:10:29,920 --> 00:10:33,560 Speaker 1: don't know again is if we get into any significant 187 00:10:33,559 --> 00:10:36,720 Speaker 1: market corrective phase beyond just what we had for a 188 00:10:36,760 --> 00:10:39,439 Speaker 1: short period in June and a short period of September, 189 00:10:40,200 --> 00:10:43,679 Speaker 1: whether they get beholdened on the long side, which was 190 00:10:43,720 --> 00:10:47,560 Speaker 1: what happened in September, or they get scared out of 191 00:10:47,559 --> 00:10:49,440 Speaker 1: the market if the pain is more severe than what 192 00:10:49,480 --> 00:10:52,720 Speaker 1: we experienced, or do they just shift gears and start 193 00:10:52,760 --> 00:10:54,520 Speaker 1: doing the same thing on the putch side of the 194 00:10:54,520 --> 00:10:57,280 Speaker 1: options equation as they did on the call side. So 195 00:10:57,320 --> 00:10:59,840 Speaker 1: we don't know. What I will say is the kind 196 00:10:59,840 --> 00:11:04,480 Speaker 1: of speculative fraud we're seeing among that cohort is not 197 00:11:04,679 --> 00:11:09,960 Speaker 1: matched by other measures of investor sentiment, either attitudinal or behavioral. 198 00:11:10,400 --> 00:11:13,840 Speaker 1: So we don't have the same kind of speculative fervor 199 00:11:13,920 --> 00:11:19,880 Speaker 1: whether it's in attitudinal surveys like AII or other measures 200 00:11:19,920 --> 00:11:23,160 Speaker 1: that I think are tracking more what either older individual 201 00:11:23,360 --> 00:11:28,120 Speaker 1: investors not traders are doing, or across the spectrum of institutions. 202 00:11:28,120 --> 00:11:32,040 Speaker 1: And in fact, it's never happened before, but very recently 203 00:11:32,160 --> 00:11:37,840 Speaker 1: we've seen this huge increase in call buying um by 204 00:11:37,960 --> 00:11:42,320 Speaker 1: small traders at the same time a huge increase in 205 00:11:42,320 --> 00:11:46,280 Speaker 1: index put buying, and that tends to be done by 206 00:11:46,320 --> 00:11:50,040 Speaker 1: the commercial hedgers and the big institutions. So we have 207 00:11:50,280 --> 00:11:54,000 Speaker 1: this incredible divergence between what we used to think of 208 00:11:54,040 --> 00:11:56,680 Speaker 1: as the smart money and the dumb money. So far, 209 00:11:57,080 --> 00:11:59,000 Speaker 1: to the extent you think of this cohort as the 210 00:11:59,080 --> 00:12:01,400 Speaker 1: dumb money, they have been so dumb because they've been right, 211 00:12:01,760 --> 00:12:04,720 Speaker 1: but they also haven't been tested to any significant degree. 212 00:12:04,800 --> 00:12:07,760 Speaker 1: But I also think you know, Mike, you rightly cited 213 00:12:07,800 --> 00:12:11,440 Speaker 1: these statistics around what percentage they represent in trading volume. 214 00:12:11,720 --> 00:12:14,720 Speaker 1: But there's feeder effects of that. So if you're if 215 00:12:14,760 --> 00:12:16,880 Speaker 1: you're a small trader and you're buying a call option, 216 00:12:17,080 --> 00:12:20,080 Speaker 1: the market maker selling that call option has to purchase 217 00:12:20,080 --> 00:12:23,440 Speaker 1: the underlying security as a hedge, So that forces the 218 00:12:23,480 --> 00:12:27,600 Speaker 1: market makers to buy the same stocks that underlie the 219 00:12:27,640 --> 00:12:30,360 Speaker 1: options that the small traders are doing. And then because 220 00:12:30,440 --> 00:12:34,280 Speaker 1: a small subset of stocks represents such a large share 221 00:12:34,360 --> 00:12:37,240 Speaker 1: of the overall index, it pushes the index up, and 222 00:12:37,280 --> 00:12:40,920 Speaker 1: traditional institutions, who might be benchmarked against the SMP have 223 00:12:41,080 --> 00:12:44,040 Speaker 1: no hope of beating the SMP unless they're in those names. 224 00:12:44,080 --> 00:13:01,520 Speaker 1: So there is the circle in which we live. I've 225 00:13:01,520 --> 00:13:04,000 Speaker 1: heard the last couple of weeks described as deja vu 226 00:13:04,200 --> 00:13:06,880 Speaker 1: to August and September. Now to be seen if it 227 00:13:07,000 --> 00:13:09,840 Speaker 1: ends the same way. But something I find really interesting 228 00:13:09,960 --> 00:13:11,960 Speaker 1: is that in the middle of the summer, I feel 229 00:13:11,960 --> 00:13:15,760 Speaker 1: like we constantly heard this idea that the only reason 230 00:13:16,000 --> 00:13:20,680 Speaker 1: that we saw these smaller retail traders really uh active 231 00:13:20,679 --> 00:13:22,839 Speaker 1: in the markets was because they were bored. There were 232 00:13:22,840 --> 00:13:26,960 Speaker 1: no sports on Those that were young weren't in school, 233 00:13:27,320 --> 00:13:29,800 Speaker 1: uh college was out of session. Well, now we're in 234 00:13:29,880 --> 00:13:33,360 Speaker 1: late October, there are plenty of sports to watch on TV. 235 00:13:34,080 --> 00:13:36,240 Speaker 1: Many have gone back to school. If that's the case, 236 00:13:36,240 --> 00:13:37,959 Speaker 1: if you're a college aged kid, or at least you're 237 00:13:37,960 --> 00:13:42,040 Speaker 1: taking classes virtually to some extent, and we hear these 238 00:13:42,360 --> 00:13:46,600 Speaker 1: relations or comparisons to the dot com days. Is it possible, 239 00:13:46,720 --> 00:13:49,199 Speaker 1: And I know it's dangerous to say it's different this time, 240 00:13:49,200 --> 00:13:51,320 Speaker 1: but is it possible to say the difference now is 241 00:13:51,360 --> 00:13:54,680 Speaker 1: that we do have this move to zero commissions, and 242 00:13:54,760 --> 00:13:56,880 Speaker 1: it's very possible that this is a trend that's here 243 00:13:56,920 --> 00:13:59,040 Speaker 1: to stay. This is a new cohort of the market 244 00:13:59,400 --> 00:14:02,960 Speaker 1: that isn't just going to disappear. Well, I hope it's 245 00:14:03,040 --> 00:14:04,880 Speaker 1: a new cohort of the market. I hope we have 246 00:14:05,000 --> 00:14:08,160 Speaker 1: finally enticed younger investors into the world of investing in 247 00:14:08,160 --> 00:14:11,360 Speaker 1: the stock market, because I think pre pandemic they were 248 00:14:11,400 --> 00:14:14,280 Speaker 1: sort of written off as as dead. Never we're never 249 00:14:14,320 --> 00:14:17,440 Speaker 1: going to entice younger investors into the market, maybe because 250 00:14:17,480 --> 00:14:21,880 Speaker 1: of either they were burned through the financial crisis, or 251 00:14:21,920 --> 00:14:25,000 Speaker 1: maybe they watched parents get burned through the financial crisis 252 00:14:25,000 --> 00:14:28,640 Speaker 1: in Wall Street broadly was it's been sometimes painted with 253 00:14:28,680 --> 00:14:33,400 Speaker 1: a very negative brush, so long term, I'm somewhat hopeful 254 00:14:34,000 --> 00:14:37,360 Speaker 1: that doesn't mean there aren't risks in the very near term. Now, 255 00:14:37,480 --> 00:14:40,400 Speaker 1: I think even now that sports is back and sports 256 00:14:40,400 --> 00:14:44,440 Speaker 1: betting is back, what we have to remember is that 257 00:14:45,000 --> 00:14:48,600 Speaker 1: this has become Partly why this has become popular is 258 00:14:48,640 --> 00:14:54,760 Speaker 1: because it's working so far and so um This sort 259 00:14:54,760 --> 00:14:58,280 Speaker 1: of cohort feeds off itself. There's a lot of platforms 260 00:14:58,320 --> 00:15:02,040 Speaker 1: that it exposed what there's are are doing. It's almost 261 00:15:02,120 --> 00:15:06,640 Speaker 1: like the you know, pelotonification of trading or the gamification 262 00:15:06,680 --> 00:15:10,600 Speaker 1: of trading. So the bells and the whistles and the 263 00:15:10,680 --> 00:15:15,840 Speaker 1: excitement of of doing well and making money. That um 264 00:15:15,880 --> 00:15:18,240 Speaker 1: that I think is the It's a force in the 265 00:15:18,280 --> 00:15:22,720 Speaker 1: near term. But if it eventually can morph into a 266 00:15:23,320 --> 00:15:27,280 Speaker 1: true educated understanding of what it means to invest long 267 00:15:27,440 --> 00:15:31,280 Speaker 1: term without significant carnage on the path from point A 268 00:15:31,360 --> 00:15:34,480 Speaker 1: to point B, that would be great. UM. And I 269 00:15:34,520 --> 00:15:36,400 Speaker 1: don't I don't view this as some bubble that's going 270 00:15:36,440 --> 00:15:40,960 Speaker 1: to burst spectacularly and uh, these folks are going to 271 00:15:41,040 --> 00:15:43,280 Speaker 1: be in a world of hurt. But there are some 272 00:15:43,400 --> 00:15:45,960 Speaker 1: risks associated with it. Is just a question again of 273 00:15:46,040 --> 00:15:49,320 Speaker 1: whether we can sort of bridge this gap and that 274 00:15:49,680 --> 00:15:54,479 Speaker 1: in that span there's appropriate education because more than just anecdotally, 275 00:15:54,520 --> 00:15:56,720 Speaker 1: we know that some of these traders, particularly in the 276 00:15:56,760 --> 00:16:00,520 Speaker 1: options market, UM, may not be as educate hated about 277 00:16:00,560 --> 00:16:04,640 Speaker 1: what they're doing as what an ideal scenario would be. Yes, 278 00:16:04,640 --> 00:16:07,160 Speaker 1: Sarah points out sports her back on TV. Except for 279 00:16:07,200 --> 00:16:10,680 Speaker 1: Sarah's Miami Heat, they got their season got canceled. It 280 00:16:10,760 --> 00:16:13,080 Speaker 1: was a sad ending, but you know the fact that 281 00:16:13,120 --> 00:16:15,840 Speaker 1: they made it to the finals. I'll take it. I'll 282 00:16:15,880 --> 00:16:18,800 Speaker 1: take it well. I'll tell you, you know, speaking of 283 00:16:18,840 --> 00:16:23,280 Speaker 1: that that sort of young aggressive cohort of investors, I 284 00:16:23,320 --> 00:16:25,240 Speaker 1: will point out. I haven't had my shoes my shoes 285 00:16:25,280 --> 00:16:27,000 Speaker 1: shined in a long time, so I don't have this 286 00:16:27,200 --> 00:16:31,120 Speaker 1: sort of shoeshine guy anecdote. But my seventeen year old 287 00:16:31,160 --> 00:16:34,160 Speaker 1: daughter just got a job and a couple of paychecks 288 00:16:34,160 --> 00:16:36,200 Speaker 1: into it. She came up to me and said, I'm 289 00:16:36,240 --> 00:16:38,240 Speaker 1: I really want to get into the stock market. Do 290 00:16:38,320 --> 00:16:40,720 Speaker 1: you know anything about the stock market? And of course 291 00:16:40,760 --> 00:16:43,240 Speaker 1: I was like, not, not really though, but does your 292 00:16:43,280 --> 00:16:47,520 Speaker 1: daughter know what you do? Clai? Now I clearly realized 293 00:16:47,560 --> 00:16:49,320 Speaker 1: she has not been paying attention at all. And when 294 00:16:49,320 --> 00:16:51,480 Speaker 1: I when I explained to her what I do, but 295 00:16:51,560 --> 00:16:55,200 Speaker 1: she did she mentioned Tesla. She do someone someone knew 296 00:16:55,240 --> 00:16:57,600 Speaker 1: someone who made ten thousand dollars in Tesla and then 297 00:16:57,880 --> 00:17:00,520 Speaker 1: someone else made enough money to buy buy a Tesla 298 00:17:00,600 --> 00:17:03,600 Speaker 1: with what they've made on Tesla, So I do you 299 00:17:03,640 --> 00:17:07,119 Speaker 1: know its? And it's getting to that sort of anecdotal level. 300 00:17:07,359 --> 00:17:10,439 Speaker 1: I think, where you know? Again, who's I don't know 301 00:17:10,480 --> 00:17:12,919 Speaker 1: anyone who gets their shoeshine anymore, but it's it's that 302 00:17:13,040 --> 00:17:17,680 Speaker 1: sort of unsophisticated. It's sort of to me. I hate 303 00:17:17,680 --> 00:17:20,480 Speaker 1: to bring the parallel to the cryptocurrency craze and the 304 00:17:20,480 --> 00:17:24,399 Speaker 1: bitcoin craze a few years ago, but it almost feels 305 00:17:24,440 --> 00:17:27,200 Speaker 1: like that to me, is this sort of piling in, 306 00:17:27,800 --> 00:17:32,119 Speaker 1: uh into the momentum um? But I wonder, you know, 307 00:17:34,119 --> 00:17:37,680 Speaker 1: put aside the election, put aside sort of what retail 308 00:17:37,720 --> 00:17:40,280 Speaker 1: traders do next, and you get back to the fundamentals 309 00:17:40,280 --> 00:17:41,960 Speaker 1: and you look at an smp it, I don't know, 310 00:17:42,080 --> 00:17:44,560 Speaker 1: was it twenty seven and change on a on a 311 00:17:44,600 --> 00:17:47,520 Speaker 1: trailing earnings basis. I know you're not gonna go to 312 00:17:47,560 --> 00:17:49,720 Speaker 1: cash because the election is coming up, But does that 313 00:17:49,800 --> 00:17:53,439 Speaker 1: sort of valuation, given all the unknowns with how the 314 00:17:53,560 --> 00:17:56,199 Speaker 1: virus and the vaccine will progress, does that give you 315 00:17:56,240 --> 00:17:59,560 Speaker 1: a pause at all to to sort of d risk um, 316 00:18:00,119 --> 00:18:02,919 Speaker 1: you know, ahead of sort of how we see the 317 00:18:02,960 --> 00:18:06,600 Speaker 1: economy shaping up next year. I think there may be 318 00:18:06,800 --> 00:18:09,840 Speaker 1: reasons to de risk, especially if your portfolio is now 319 00:18:11,080 --> 00:18:16,119 Speaker 1: grown potentially via lack of rebalancing, to a heavy emphasis 320 00:18:16,240 --> 00:18:20,560 Speaker 1: on those kind of hot momentum areas of the market. Um. 321 00:18:20,680 --> 00:18:24,800 Speaker 1: But I wouldn't use valuation as certainly not a singular 322 00:18:24,840 --> 00:18:28,080 Speaker 1: reason to do that, because valuation of any variety, whether 323 00:18:28,080 --> 00:18:33,359 Speaker 1: it's trailing pe forward, pe Schiller's cyclically adjusted pe, Tobin's 324 00:18:33,440 --> 00:18:38,560 Speaker 1: q FED model, price to book price to sales um terrible, 325 00:18:38,720 --> 00:18:43,640 Speaker 1: terrible market timing tool um. There's there's no correlation between 326 00:18:43,800 --> 00:18:47,359 Speaker 1: what valuation is at any point in time and what 327 00:18:47,480 --> 00:18:49,840 Speaker 1: the market does say over the subsequent one year period 328 00:18:49,880 --> 00:18:53,080 Speaker 1: of time. Correlations go higher when you look out over 329 00:18:53,600 --> 00:18:56,840 Speaker 1: many years, you know, call it ten year time periods. 330 00:18:56,880 --> 00:18:59,560 Speaker 1: And the reason for that is we think of valuation, 331 00:19:00,440 --> 00:19:03,520 Speaker 1: particularly in when you're talking about PE ratio, is having 332 00:19:03,640 --> 00:19:08,000 Speaker 1: to quantifiable components. You know what the P is certainly 333 00:19:08,000 --> 00:19:09,840 Speaker 1: on a trailing basis, you know what the E is 334 00:19:09,880 --> 00:19:12,719 Speaker 1: on a forward basis. You know what the expectation is 335 00:19:12,800 --> 00:19:15,719 Speaker 1: because it's published. So we therefore think of it as 336 00:19:15,800 --> 00:19:21,560 Speaker 1: this fundamental indicator because there's quantifiable components. The reality is 337 00:19:21,640 --> 00:19:25,160 Speaker 1: that valuation is a sentiment indicator more than it is 338 00:19:25,200 --> 00:19:28,320 Speaker 1: a fundamental indicator. There are times where investors are willing 339 00:19:28,359 --> 00:19:31,879 Speaker 1: to pay nosebleed valuations and find ways to justify it, 340 00:19:31,920 --> 00:19:34,640 Speaker 1: and there's times when investors don't even want to pay 341 00:19:34,640 --> 00:19:37,399 Speaker 1: a single digit PE ratio, like in early two thousand 342 00:19:37,400 --> 00:19:39,800 Speaker 1: and nine. So it's a reflection of sentiment more than 343 00:19:39,800 --> 00:19:44,320 Speaker 1: anything else. I think the valuation measure or measures that 344 00:19:44,520 --> 00:19:48,800 Speaker 1: the cardon ardent bulls will use in this environment are 345 00:19:48,880 --> 00:19:52,480 Speaker 1: equity risk premiums given that we've got short rates pinned 346 00:19:52,480 --> 00:19:54,480 Speaker 1: at zero as far as the I can see, so 347 00:19:54,600 --> 00:19:58,600 Speaker 1: the discount rate you're using to discount future earnings is 348 00:19:58,640 --> 00:20:02,639 Speaker 1: basically zero, and on an equity risk premium relative to 349 00:20:02,880 --> 00:20:07,399 Speaker 1: treasuries relative corporate bonds, stocks look relatively inexpensive. Mike, My 350 00:20:07,560 --> 00:20:09,679 Speaker 1: sort of take on the other side of that is 351 00:20:10,040 --> 00:20:13,680 Speaker 1: totally agree the discount rate is pegged at zero. However, 352 00:20:14,240 --> 00:20:18,280 Speaker 1: it's a discount rate discounting a future stream of earnings. 353 00:20:18,560 --> 00:20:20,600 Speaker 1: We are at some point going to actually have to 354 00:20:20,680 --> 00:20:24,240 Speaker 1: see that future stream of earnings. A ZIRP environment is 355 00:20:24,240 --> 00:20:27,760 Speaker 1: not going to sustain the market at infinitum without an 356 00:20:27,760 --> 00:20:30,840 Speaker 1: eventual return in earnings. I just think that discount rate 357 00:20:30,880 --> 00:20:34,600 Speaker 1: being pegged at zero is saying to investors that pay 358 00:20:34,640 --> 00:20:37,760 Speaker 1: attention to this stuff, maybe you can lengthen your time 359 00:20:37,800 --> 00:20:41,080 Speaker 1: horizon in terms of the weight until earnings moved back 360 00:20:41,080 --> 00:20:44,680 Speaker 1: into positive territory supported by that low interest rate environment. 361 00:20:44,760 --> 00:20:49,560 Speaker 1: So I get it um, But in broadly do I 362 00:20:49,640 --> 00:20:52,600 Speaker 1: think there are risks in this market valuation and otherwise 363 00:20:52,760 --> 00:21:11,040 Speaker 1: absolutely so. We do have to see that return in earnings, 364 00:21:11,080 --> 00:21:14,160 Speaker 1: and this week earning season did kick off. We're expected 365 00:21:14,200 --> 00:21:17,760 Speaker 1: to see another decline this quarter of about another decline 366 00:21:17,760 --> 00:21:20,800 Speaker 1: in the fourth quarter. However, when I look at numbers, 367 00:21:20,840 --> 00:21:23,720 Speaker 1: I still see consensus analyst estimates looking for about one 368 00:21:23,800 --> 00:21:26,920 Speaker 1: sixty two of earnings per share in the SMP, which 369 00:21:27,000 --> 00:21:30,000 Speaker 1: is not far off where we were just last year 370 00:21:30,040 --> 00:21:34,320 Speaker 1: in Do you think that it's possible people are still 371 00:21:34,359 --> 00:21:37,280 Speaker 1: too optimistic about one? I mean, if if you say 372 00:21:37,280 --> 00:21:39,200 Speaker 1: that at some point we have to get those earnings, 373 00:21:39,200 --> 00:21:42,200 Speaker 1: clearly they're pretty optimistic that we will, and and not 374 00:21:42,400 --> 00:21:46,240 Speaker 1: too far away. Even in a normal environment, analysts when 375 00:21:46,240 --> 00:21:48,760 Speaker 1: you're looking a year out tend to be too optimistic. 376 00:21:49,040 --> 00:21:51,199 Speaker 1: Then as you get closer to the actual season for 377 00:21:51,240 --> 00:21:54,440 Speaker 1: the quarter, they cut cut, cut, cut cut, ultimately setting 378 00:21:54,480 --> 00:21:57,720 Speaker 1: the bar low enough such that the beat rate is 379 00:21:57,920 --> 00:22:01,720 Speaker 1: you know, typically in the UM. Unique in this environment, 380 00:22:01,720 --> 00:22:04,800 Speaker 1: of course, is the lack of visibility, the fact that 381 00:22:04,840 --> 00:22:07,800 Speaker 1: a record number of companies have withdrawn guidance, certainly in 382 00:22:07,840 --> 00:22:11,040 Speaker 1: the second quarter. So what analysts have done, at least 383 00:22:11,040 --> 00:22:14,200 Speaker 1: for this year is when you know, absent that more 384 00:22:14,240 --> 00:22:18,920 Speaker 1: precise guidance from companies UM and absent even macro visibility. 385 00:22:18,960 --> 00:22:21,439 Speaker 1: Given the unique circumstances as virus as they aired on 386 00:22:21,480 --> 00:22:23,800 Speaker 1: the side of cutting estimates too much, so you had 387 00:22:23,800 --> 00:22:27,680 Speaker 1: a six percent beat rate for the second quarter. You're 388 00:22:27,760 --> 00:22:30,320 Speaker 1: running out about a similar beat rate right now. Albeit 389 00:22:30,520 --> 00:22:33,520 Speaker 1: were very early in in earning season at this point, 390 00:22:33,840 --> 00:22:36,240 Speaker 1: and that may be the case for the fourth quarter 391 00:22:36,320 --> 00:22:39,879 Speaker 1: as well. But I do think given what we know 392 00:22:40,040 --> 00:22:43,359 Speaker 1: now about the economy and its trajectory, I think the 393 00:22:43,440 --> 00:22:47,040 Speaker 1: numbers as they stand right now probably are a little 394 00:22:47,040 --> 00:22:50,639 Speaker 1: bit high, but as they start to come down, it 395 00:22:50,680 --> 00:22:53,840 Speaker 1: wouldn't be that abnormal relative to what we typically see 396 00:22:54,440 --> 00:22:58,000 Speaker 1: in history. Ells as you point out, with the equity 397 00:22:58,119 --> 00:23:01,080 Speaker 1: risk premium on the discount rate being close to zero, 398 00:23:01,160 --> 00:23:04,600 Speaker 1: I mean, it brings us back to that old boogeyman inflation, 399 00:23:04,680 --> 00:23:07,840 Speaker 1: you know, and I I feel like it's got to 400 00:23:07,840 --> 00:23:11,080 Speaker 1: be the main risk for the stock market is some 401 00:23:11,200 --> 00:23:14,359 Speaker 1: surprise in inflation. But that said, it's it's kind of 402 00:23:14,359 --> 00:23:17,480 Speaker 1: been a chicken little situation with inflation over the last decades. 403 00:23:17,840 --> 00:23:20,800 Speaker 1: People have worried about it forever, been warning that we're 404 00:23:20,840 --> 00:23:24,359 Speaker 1: we're headed for some really big inflationary environment and we 405 00:23:24,480 --> 00:23:28,280 Speaker 1: just don't see it. Year after year, any sort of 406 00:23:28,760 --> 00:23:33,240 Speaker 1: you know, CPI or PC above that two percent, especially 407 00:23:33,320 --> 00:23:36,000 Speaker 1: on the core basis. Is there any reason I believe 408 00:23:36,040 --> 00:23:38,639 Speaker 1: it's just different this time? Do you see, you know, 409 00:23:39,560 --> 00:23:42,960 Speaker 1: any potential for an inflation shock given all the all 410 00:23:42,960 --> 00:23:45,920 Speaker 1: the stimulus given to the economy, how low rates are, 411 00:23:46,640 --> 00:23:49,040 Speaker 1: and if we do get sort of a real, real 412 00:23:49,520 --> 00:23:53,080 Speaker 1: rapid recovery next year, is there any inflation risk in 413 00:23:53,080 --> 00:23:56,680 Speaker 1: your mind? Well, I'll start with the with answering the 414 00:23:56,760 --> 00:23:59,240 Speaker 1: question is at different this time, but but in particular, 415 00:23:59,400 --> 00:24:02,320 Speaker 1: compare to the period coming out of the financial crisis, 416 00:24:02,320 --> 00:24:07,119 Speaker 1: the last time we had uh massive stimulus. Now, in 417 00:24:07,119 --> 00:24:09,920 Speaker 1: that case, it was purely on the monetary side, very 418 00:24:09,960 --> 00:24:13,040 Speaker 1: little if any on the on the fiscal side, and 419 00:24:13,320 --> 00:24:17,000 Speaker 1: there was grave concern in the quite a few years 420 00:24:17,320 --> 00:24:20,280 Speaker 1: um coming out of whether it was what the FED 421 00:24:20,359 --> 00:24:24,000 Speaker 1: did with rates going to zero, but particularly the what 422 00:24:24,200 --> 00:24:27,000 Speaker 1: turned into three rounds of quantitative easy, and everybody was 423 00:24:27,040 --> 00:24:29,840 Speaker 1: concerned about inflation with the FED, you know, printing all 424 00:24:29,880 --> 00:24:32,359 Speaker 1: this money that was going to inflation accident waiting to happen. 425 00:24:32,400 --> 00:24:35,280 Speaker 1: What was missing in that analysis is that the FED 426 00:24:35,440 --> 00:24:38,879 Speaker 1: was pumping liquidity into the financial system during a period 427 00:24:38,920 --> 00:24:42,879 Speaker 1: where the financial system, by necessity, was deleveraging. So the 428 00:24:43,480 --> 00:24:46,359 Speaker 1: money that they fed pumped into the financial system stayed 429 00:24:46,359 --> 00:24:48,280 Speaker 1: in the financial system. It didn't come out through the 430 00:24:48,320 --> 00:24:51,320 Speaker 1: lending spigots, there was no demand for borrowing, didn't go 431 00:24:51,359 --> 00:24:54,440 Speaker 1: into the economy and pick up what we call velocity. 432 00:24:54,640 --> 00:24:57,439 Speaker 1: You you mathematically can't get an inflation problem when you 433 00:24:57,480 --> 00:25:00,200 Speaker 1: have no velocity. Now in this cycle, right now, we're 434 00:25:00,240 --> 00:25:02,400 Speaker 1: still in that boat in the sense that we've had 435 00:25:02,480 --> 00:25:06,680 Speaker 1: all of this monetary liquidity pumped into the system. They've 436 00:25:06,720 --> 00:25:09,320 Speaker 1: even morph more to trying to pump it into the 437 00:25:09,359 --> 00:25:11,439 Speaker 1: economy too, with some of the new tools that are 438 00:25:11,520 --> 00:25:14,480 Speaker 1: using on the main street lending program. That on top 439 00:25:14,520 --> 00:25:18,040 Speaker 1: of that, you've had massive fiscal relief. All combined, you're 440 00:25:18,040 --> 00:25:23,639 Speaker 1: talking about GDP causing money supply growth and as measured 441 00:25:23,680 --> 00:25:27,320 Speaker 1: by M two to go up by UM year every 442 00:25:27,400 --> 00:25:30,679 Speaker 1: year that was at the peak. However, at this point 443 00:25:30,720 --> 00:25:35,120 Speaker 1: so far, the M to money velocity continues to sink 444 00:25:35,200 --> 00:25:39,040 Speaker 1: like a stone. So not an inflation problem, but that 445 00:25:39,280 --> 00:25:43,080 Speaker 1: may not be a permanent situation. Um eras not just 446 00:25:43,200 --> 00:25:47,560 Speaker 1: the United States, but globally. Eras of monetary dominance when 447 00:25:47,560 --> 00:25:51,000 Speaker 1: they end tend to end in disinflation or deflation. And 448 00:25:51,040 --> 00:25:54,000 Speaker 1: we saw that after the financial crisis, and after that 449 00:25:54,240 --> 00:25:59,080 Speaker 1: kind of monetary period of of of extreme stimulus, eras 450 00:25:59,200 --> 00:26:04,400 Speaker 1: of fiscal dominance tend to end in inflation, especially if 451 00:26:05,359 --> 00:26:10,520 Speaker 1: the fiscal spending is being done through a debt taking 452 00:26:10,520 --> 00:26:15,280 Speaker 1: on more debt directly or indirectly being financed by monetary authorities. 453 00:26:15,800 --> 00:26:17,960 Speaker 1: So I do think there's a risk. I don't think 454 00:26:17,960 --> 00:26:20,879 Speaker 1: it's imminent. Um. I think this the nature of this 455 00:26:21,040 --> 00:26:26,440 Speaker 1: crisis is more deflationary than inflationary. But I think there's 456 00:26:26,560 --> 00:26:29,840 Speaker 1: two sanguine of view about inflation, kind of in the 457 00:26:29,880 --> 00:26:34,200 Speaker 1: medium to longer term, and leaving aside the fiscal monetary 458 00:26:34,280 --> 00:26:39,480 Speaker 1: stimulus triggers potentially for some inflation, you've also got this 459 00:26:39,680 --> 00:26:44,199 Speaker 1: secular move toward deglobalization and diversification of supply chains. If 460 00:26:44,200 --> 00:26:46,720 Speaker 1: you're a believer like me that part of the reason 461 00:26:46,760 --> 00:26:50,440 Speaker 1: why we had declining inflation for thirty years was because 462 00:26:50,440 --> 00:26:55,760 Speaker 1: of globalization, it's hard not to see the opposite potentially happening. 463 00:26:55,840 --> 00:27:00,439 Speaker 1: So I do worry that we went from unfounded fears 464 00:27:00,480 --> 00:27:04,840 Speaker 1: of inflation in and that was sort of the narrative. 465 00:27:04,840 --> 00:27:08,000 Speaker 1: It wasn't true. Now I think the consensus is that 466 00:27:08,119 --> 00:27:11,160 Speaker 1: inflation is dead and buried forever, and I can't help 467 00:27:11,200 --> 00:27:14,280 Speaker 1: but wonder whether, um, you know the devil's advocate in 468 00:27:14,359 --> 00:27:16,880 Speaker 1: he says, Okay, what could the conditions be that actually 469 00:27:16,920 --> 00:27:21,000 Speaker 1: bring more inflation than what is currently built into expectations, 470 00:27:21,080 --> 00:27:23,280 Speaker 1: and that would be a longer term risk for stocks. 471 00:27:23,680 --> 00:27:25,399 Speaker 1: It's so one more question for you, Louzanne before we 472 00:27:25,440 --> 00:27:27,400 Speaker 1: get to sharing our crazy things, which I know Mike 473 00:27:27,480 --> 00:27:29,720 Speaker 1: is so excited about. But well, we'll we'll have to 474 00:27:29,720 --> 00:27:31,560 Speaker 1: wait to see what happens on the fiscal front. But 475 00:27:31,880 --> 00:27:34,760 Speaker 1: there was a comment this week from San Francisco FED 476 00:27:34,760 --> 00:27:38,040 Speaker 1: President Mary daily Um that really struck a chord, and 477 00:27:38,200 --> 00:27:40,240 Speaker 1: I'll read it to you. She said, I'm not willing 478 00:27:40,280 --> 00:27:42,240 Speaker 1: to trade millions of jobs for people who need a 479 00:27:42,320 --> 00:27:44,680 Speaker 1: ladder rung up in order to keep the stock market 480 00:27:44,720 --> 00:27:46,760 Speaker 1: from going up for a few who have those holdings. 481 00:27:46,760 --> 00:27:50,439 Speaker 1: And basically she was asked about whether or not the 482 00:27:50,520 --> 00:27:54,320 Speaker 1: FED was creating a moral hazard by increasing asset prices, 483 00:27:54,400 --> 00:27:57,480 Speaker 1: and she said the nature of this recovery is uneven, 484 00:27:57,720 --> 00:28:01,000 Speaker 1: and we need to help people, not necessarily help the 485 00:28:01,040 --> 00:28:03,800 Speaker 1: stock market. Although we may be inflating asset prices. What 486 00:28:03,840 --> 00:28:06,160 Speaker 1: does that tell you about what the FED is willing 487 00:28:06,200 --> 00:28:08,800 Speaker 1: to do here. Um. Also in relation to the type 488 00:28:08,840 --> 00:28:11,879 Speaker 1: of recovery that we are seeing, I think the FED 489 00:28:12,119 --> 00:28:17,880 Speaker 1: understands the moral hazard aspect of this that inadvertently, not purposefully, 490 00:28:17,920 --> 00:28:20,879 Speaker 1: what they've done has been much more to the benefit 491 00:28:20,920 --> 00:28:23,000 Speaker 1: of asset prices and less to the benefit of the 492 00:28:23,000 --> 00:28:26,679 Speaker 1: real economy, and that it's it's widened the divide in 493 00:28:26,840 --> 00:28:29,919 Speaker 1: terms of the wealth gap, and that is part of 494 00:28:29,920 --> 00:28:34,640 Speaker 1: the reason why not just daily, but but Powell, as 495 00:28:34,760 --> 00:28:37,080 Speaker 1: as often as he's got a microphone or a camera 496 00:28:37,080 --> 00:28:40,280 Speaker 1: in front of him, is really pounding the table on 497 00:28:40,320 --> 00:28:42,480 Speaker 1: the kneed for more on the fiscal side than on 498 00:28:42,520 --> 00:28:46,440 Speaker 1: the monetary side. And I think they are The FED 499 00:28:46,600 --> 00:28:50,280 Speaker 1: collectively is sending a very forceful message, not that they're 500 00:28:50,280 --> 00:28:54,880 Speaker 1: out of tools, um, but that the tools or the 501 00:28:55,080 --> 00:28:58,640 Speaker 1: efforts that are needed now to truly help small businesses 502 00:28:58,720 --> 00:29:02,520 Speaker 1: in the more beleaguered industry reason individuals who are still 503 00:29:02,560 --> 00:29:05,320 Speaker 1: out of work, has to be done on the fiscal side, 504 00:29:05,640 --> 00:29:08,400 Speaker 1: not on the monetary side. And I think that that's 505 00:29:08,440 --> 00:29:12,680 Speaker 1: the appropriate message. Whether you know, whether there are adults 506 00:29:12,680 --> 00:29:14,920 Speaker 1: in the room on both sides of the aisle that 507 00:29:15,000 --> 00:29:18,560 Speaker 1: actually can get together and figure this out. Maybe it's 508 00:29:18,600 --> 00:29:21,280 Speaker 1: a different story, alright, Mike. I think it's that time, 509 00:29:21,520 --> 00:29:24,800 Speaker 1: all right, It's the time for the crazy things. Stand 510 00:29:24,840 --> 00:29:28,680 Speaker 1: clear of the craziest things we saw in markets this week, 511 00:29:29,280 --> 00:29:31,480 Speaker 1: and well this is exciting. We do have a call 512 00:29:31,560 --> 00:29:35,880 Speaker 1: to the What Goes Up hotline. This is Sam Kidson. 513 00:29:36,160 --> 00:29:38,760 Speaker 1: Let's hear what the craziest thing he saw in markets 514 00:29:38,800 --> 00:29:41,840 Speaker 1: this week. Was. The craziest thing I saw in markets 515 00:29:41,840 --> 00:29:46,440 Speaker 1: this week is lumber futures. The lumber futures which trade 516 00:29:46,440 --> 00:29:50,440 Speaker 1: on the SAMI are quoted in dollars per thousand board feet, 517 00:29:50,720 --> 00:29:55,000 Speaker 1: and these started off the year around four hundred dollars 518 00:29:55,040 --> 00:29:58,840 Speaker 1: per thousand board feet, and like all markets, you know, 519 00:29:58,880 --> 00:30:02,160 Speaker 1: on April one, thanks to Day, it hit about two eight. 520 00:30:02,640 --> 00:30:08,120 Speaker 1: Now it's trading around five hundred fifty kind of thing, 521 00:30:08,920 --> 00:30:11,800 Speaker 1: so obviously up significantly from the beginning of the year 522 00:30:11,880 --> 00:30:14,440 Speaker 1: and from the low it reached in April. But the 523 00:30:14,520 --> 00:30:19,080 Speaker 1: really crazy part is that on August it was actually 524 00:30:19,160 --> 00:30:23,120 Speaker 1: quoted intra day over eight hundred dollars, So we're talking 525 00:30:23,160 --> 00:30:26,240 Speaker 1: about three x or so where it traded in April 526 00:30:26,240 --> 00:30:28,720 Speaker 1: and double where it started the year. So that's the 527 00:30:28,760 --> 00:30:31,760 Speaker 1: craziest thing I've seen in markets this week. All right, 528 00:30:31,840 --> 00:30:34,600 Speaker 1: well done, Sam, lumber futures. I don't think we've had 529 00:30:34,680 --> 00:30:38,240 Speaker 1: lumber futures in the crazy things yet, and it really 530 00:30:38,320 --> 00:30:40,400 Speaker 1: has been a wild year for lumber futures, so we 531 00:30:40,440 --> 00:30:44,400 Speaker 1: thank you for that. Sam. Sarah, can you beat the 532 00:30:44,480 --> 00:30:48,400 Speaker 1: crazy week and year we've seen in lumber futures? What 533 00:30:48,440 --> 00:30:51,440 Speaker 1: do you got? All right? So I wanted to highlight 534 00:30:51,720 --> 00:30:54,240 Speaker 1: um q q Q this week the NAZAC one t F. 535 00:30:54,400 --> 00:30:57,960 Speaker 1: My colleague Katie Greifold, who's been on the show before, UM, 536 00:30:58,360 --> 00:31:00,520 Speaker 1: she wret a story about this. But I've just been 537 00:31:00,520 --> 00:31:04,480 Speaker 1: watching flows day to day and three out of four 538 00:31:04,680 --> 00:31:09,200 Speaker 1: of the fund's largest inflows have come within the last month, 539 00:31:09,280 --> 00:31:12,719 Speaker 1: and they've been huge. They've been massive compared to what 540 00:31:12,760 --> 00:31:15,600 Speaker 1: we typically see day to day. That fourth one was 541 00:31:15,640 --> 00:31:17,520 Speaker 1: in two thousand, and of course I'm not making a 542 00:31:17,560 --> 00:31:20,720 Speaker 1: comparison UM to now in two thousand, that's just when 543 00:31:20,760 --> 00:31:24,920 Speaker 1: the other one was. But in trying to ask investors 544 00:31:25,120 --> 00:31:28,600 Speaker 1: or or strategists or traders why we're seeing this, you 545 00:31:28,720 --> 00:31:31,120 Speaker 1: just get a variety of answers. UM. Some of them 546 00:31:31,160 --> 00:31:33,120 Speaker 1: are saying, this actually might be due to what we're 547 00:31:33,120 --> 00:31:37,320 Speaker 1: seeing in the options market, because we've seen some drastic 548 00:31:37,440 --> 00:31:40,720 Speaker 1: outflows to others. Just say that investors are simply just 549 00:31:40,800 --> 00:31:43,960 Speaker 1: betting on big tech, considering that q Q is been 550 00:31:44,000 --> 00:31:45,880 Speaker 1: as like one hundred ETF and has a very heavy 551 00:31:45,920 --> 00:31:48,600 Speaker 1: tech waiting. Um. But I think it's really difficult to 552 00:31:48,680 --> 00:31:52,120 Speaker 1: just look at these flows that we're seeing almost day 553 00:31:52,160 --> 00:31:54,560 Speaker 1: to day now, um and and say they're not crazy. 554 00:31:54,920 --> 00:31:57,480 Speaker 1: All right, I'll accept that no theories on that Q 555 00:31:57,680 --> 00:32:00,400 Speaker 1: and on is involved in the q q Q. Are 556 00:32:00,440 --> 00:32:02,080 Speaker 1: you going to bring that in here? I'm gonna throw 557 00:32:02,120 --> 00:32:04,600 Speaker 1: that one out there, reach out. I'll tell her that 558 00:32:04,640 --> 00:32:07,800 Speaker 1: she should update her story with the Q and on theory. Yeah, 559 00:32:07,840 --> 00:32:10,160 Speaker 1: that that's the beauty of the Q and on theories. 560 00:32:10,200 --> 00:32:11,719 Speaker 1: They don't need to make any chance. You can just 561 00:32:12,080 --> 00:32:15,080 Speaker 1: you can just shoe herman, All right, listen, can you 562 00:32:15,200 --> 00:32:18,000 Speaker 1: beat the flows into the q q Q as a 563 00:32:18,080 --> 00:32:21,800 Speaker 1: crazy thing this week? Does mine have to be market related? Nah? 564 00:32:22,040 --> 00:32:23,800 Speaker 1: For you. We'll let it slide for a blue hand. 565 00:32:23,840 --> 00:32:27,440 Speaker 1: Not let it slide, thank you. M. The craziest story 566 00:32:27,560 --> 00:32:29,680 Speaker 1: I saw this week was and I had not seen 567 00:32:29,760 --> 00:32:34,040 Speaker 1: the pre story about an asteroid that was now in 568 00:32:34,120 --> 00:32:36,800 Speaker 1: the Earth's orbit and heading towards us, and it was 569 00:32:36,840 --> 00:32:40,120 Speaker 1: a fairly large one, and it was getting increasing attention. 570 00:32:40,240 --> 00:32:43,600 Speaker 1: It actually turns out to be a portion of a rocket. 571 00:32:44,640 --> 00:32:47,719 Speaker 1: That was a rocket that had a failed moon landing 572 00:32:47,800 --> 00:32:51,640 Speaker 1: in nineteen sixty six, and it's been basically orbiting the 573 00:32:51,760 --> 00:32:55,000 Speaker 1: Sun and somehow it left the Sun's orbit and now 574 00:32:55,160 --> 00:32:57,600 Speaker 1: is in the Earth's orbit. Um and and it's not 575 00:32:57,720 --> 00:33:01,520 Speaker 1: an asteroid potentially crashing to Earth, but a what is 576 00:33:01,600 --> 00:33:05,040 Speaker 1: that a fifty four year old piece of a rocket. 577 00:33:05,640 --> 00:33:08,640 Speaker 1: That's amazing. I had not heard of that. That's really interesting. 578 00:33:08,720 --> 00:33:12,200 Speaker 1: Sounds safe for us to have a year old rockets 579 00:33:13,680 --> 00:33:15,960 Speaker 1: it lands in the middle of your roof. I'm not 580 00:33:16,080 --> 00:33:18,760 Speaker 1: sure asteroid or you know, a portion of a rocket. 581 00:33:20,400 --> 00:33:22,840 Speaker 1: Maybe the same, right, it doesn't matter. We talked about 582 00:33:22,880 --> 00:33:26,080 Speaker 1: momentum and velocity. I'm sure that would have plenty. Yeah, 583 00:33:26,160 --> 00:33:27,920 Speaker 1: that's how we tie it to the market. Yeah, there 584 00:33:28,000 --> 00:33:29,720 Speaker 1: you go. I thought it was going to be that 585 00:33:29,800 --> 00:33:32,760 Speaker 1: asteroid with like a hundred gazillion dollars worth of gold 586 00:33:32,840 --> 00:33:36,000 Speaker 1: and precious minerals stirred in it, which wouldn't be nice. 587 00:33:36,040 --> 00:33:38,320 Speaker 1: It's just gonna fall on Earth and then it's going 588 00:33:38,440 --> 00:33:42,800 Speaker 1: to make bitcoin more valuable. That's the theory. Well, that's 589 00:33:42,800 --> 00:33:44,000 Speaker 1: a good one. I'm gonna have to look up that 590 00:33:44,080 --> 00:33:46,120 Speaker 1: story and then I'm gonna I'm gonna like sleep in 591 00:33:46,200 --> 00:33:49,120 Speaker 1: my closet under pillows or something, waiting for that thing 592 00:33:49,200 --> 00:33:52,520 Speaker 1: to land. But all right, well mine, as Sarah will 593 00:33:52,520 --> 00:33:55,360 Speaker 1: tell you, I like the alternative asset space. The more 594 00:33:55,400 --> 00:34:00,520 Speaker 1: alternative the better. So very fascinating auction from STIs in 595 00:34:00,600 --> 00:34:03,719 Speaker 1: New York. And I'll preface this by saying I had 596 00:34:03,760 --> 00:34:06,200 Speaker 1: to take Shakespeare at the University of Delaware because I 597 00:34:06,280 --> 00:34:08,280 Speaker 1: was an English major. I think you were a business major. 598 00:34:08,560 --> 00:34:11,480 Speaker 1: I no, I was political science and economics, so I 599 00:34:11,560 --> 00:34:15,279 Speaker 1: did not have to take Shakespeare. I would I would 600 00:34:15,280 --> 00:34:19,319 Speaker 1: have preferred any calculus, trigonometry, stats, would throw anything at 601 00:34:19,360 --> 00:34:22,040 Speaker 1: the other than Shakespeare. I did not do well. But 602 00:34:23,520 --> 00:34:27,000 Speaker 1: this is courtesy of the National Post, a rare book 603 00:34:27,120 --> 00:34:30,640 Speaker 1: from the year sixteen twenty three. It was the first 604 00:34:30,680 --> 00:34:34,280 Speaker 1: book that brought together all of William Shakespeare's plays into 605 00:34:34,440 --> 00:34:40,439 Speaker 1: one uh one edition sold at auction at Christie's. Sorry 606 00:34:40,440 --> 00:34:41,960 Speaker 1: you know what time it is? What's your bid? I 607 00:34:42,040 --> 00:34:45,200 Speaker 1: was just about I was just kind of trying to 608 00:34:45,680 --> 00:34:47,480 Speaker 1: rack my brain and think of a price, because I've 609 00:34:47,520 --> 00:34:52,279 Speaker 1: been so unbelievably off. My guess is lately, Um, what 610 00:34:52,400 --> 00:34:57,840 Speaker 1: am I going to say? I'll go with one. K, 611 00:35:00,000 --> 00:35:04,319 Speaker 1: I'll take over, all right, listen, Yeah, you'll. She's good, 612 00:35:04,480 --> 00:35:06,759 Speaker 1: she's doing the prices right thing. She'll She'll go one. 613 00:35:08,840 --> 00:35:11,520 Speaker 1: I've been way over lately, so now I've been going 614 00:35:11,600 --> 00:35:14,440 Speaker 1: way under. Well, I just took the way over. So 615 00:35:14,520 --> 00:35:16,239 Speaker 1: I'm not going to give a number, but I think 616 00:35:16,280 --> 00:35:19,000 Speaker 1: it's way higher than that. I will tell you, based 617 00:35:19,080 --> 00:35:21,120 Speaker 1: on my own experience with Shakespeare, I would have only 618 00:35:21,160 --> 00:35:23,160 Speaker 1: bought this book if it came with the cliff notes 619 00:35:23,200 --> 00:35:26,160 Speaker 1: he attached to it as well. Al Right, before I 620 00:35:26,239 --> 00:35:29,680 Speaker 1: give you the answer, let's compare it to another alternative asset. 621 00:35:30,000 --> 00:35:32,880 Speaker 1: A rare guitar used by the Beatles George Harrison and 622 00:35:33,040 --> 00:35:37,040 Speaker 1: John Lennon sold at auction. This was a fretless guitar. 623 00:35:37,080 --> 00:35:38,360 Speaker 1: I don't know if you guys know much about it, 624 00:35:38,360 --> 00:35:41,040 Speaker 1: but that's that's very rare. It was used on the 625 00:35:41,080 --> 00:35:43,759 Speaker 1: White album on three tracks on the White Album, which, 626 00:35:43,800 --> 00:35:46,720 Speaker 1: if you know the Beatles, that might influence your your bidding. 627 00:35:47,120 --> 00:35:50,360 Speaker 1: Not not one of my favorites of theirs, but all right, Sarah, 628 00:35:51,760 --> 00:35:54,600 Speaker 1: more or less than the Shakespeare than your Shakespeare. What 629 00:35:54,640 --> 00:35:58,000 Speaker 1: are you going for it? I'd be tempting to say more, 630 00:35:58,440 --> 00:36:02,560 Speaker 1: but I could also be toably wrong. Okay, that's no, 631 00:36:02,760 --> 00:36:07,200 Speaker 1: that's not an answer. That's okay. Spear went for more 632 00:36:07,280 --> 00:36:12,080 Speaker 1: than the guitar, all right, nine point nine million for 633 00:36:12,160 --> 00:36:17,040 Speaker 1: the Shakespeare book unidentified buyer. The Beatles guitar was only 634 00:36:17,560 --> 00:36:22,359 Speaker 1: a hundred ninety pounds d quick. I was thinking more 635 00:36:22,440 --> 00:36:25,920 Speaker 1: so due to recency. Uh, And I feel like even 636 00:36:26,320 --> 00:36:28,920 Speaker 1: I feel like guitars are used as decorative aspects and 637 00:36:29,840 --> 00:36:32,879 Speaker 1: that's where my head was going with this. But yeah, 638 00:36:32,960 --> 00:36:36,080 Speaker 1: the Shakespeare books not very decorative. But I don't know. Listen, 639 00:36:37,000 --> 00:36:39,799 Speaker 1: would you dump a sixty forty portfolio to go, say, 640 00:36:40,840 --> 00:36:46,720 Speaker 1: sixty stocks Shakespeare first Edition a little bit of Beatles? 641 00:36:49,600 --> 00:36:54,399 Speaker 1: I'm a rock chick, but um I would invest if 642 00:36:54,560 --> 00:36:58,359 Speaker 1: if Robert Plant decided he is willing to bring back 643 00:36:58,480 --> 00:37:01,680 Speaker 1: led Zeppelin for a tour with Jason Bottom, I'd be 644 00:37:01,760 --> 00:37:05,080 Speaker 1: willing to invest a boatload of money in that. So 645 00:37:05,440 --> 00:37:08,600 Speaker 1: that's that's how I'll tie investing into rock bands, and 646 00:37:08,640 --> 00:37:13,200 Speaker 1: you'd be in the first row. I'd pay up for 647 00:37:13,280 --> 00:37:15,280 Speaker 1: that show too. That would be a good one, I agree. 648 00:37:16,600 --> 00:37:21,239 Speaker 1: So all right. I think that's all our time. Ohhh yeah, 649 00:37:21,320 --> 00:37:22,920 Speaker 1: we got a Oh that's good. We got a crazy 650 00:37:23,000 --> 00:37:25,960 Speaker 1: thing over Twitter. Let's hear it, Sarah. Yeah. So this 651 00:37:26,120 --> 00:37:30,239 Speaker 1: one actually comes from Nick Carraway's Twitter handles at Carraway 652 00:37:30,560 --> 00:37:33,439 Speaker 1: thirty four and he tweeted us a Wall Street Journal 653 00:37:33,480 --> 00:37:37,880 Speaker 1: story with the headline um Santander bond surges as investors 654 00:37:37,960 --> 00:37:41,480 Speaker 1: take a risky bet on debt redemption. And he said 655 00:37:41,520 --> 00:37:44,920 Speaker 1: to us, if this doesn't qualify as the craziest thing contender, 656 00:37:45,480 --> 00:37:47,800 Speaker 1: I don't know what does. And it is certainly a 657 00:37:47,920 --> 00:37:51,799 Speaker 1: great contender. The lead of the story reads investors are 658 00:37:51,840 --> 00:37:54,920 Speaker 1: betting that Spanish lender Banco Santander won't be able to 659 00:37:54,960 --> 00:37:57,360 Speaker 1: make interest payments on a risky form of debt in 660 00:37:57,440 --> 00:38:00,680 Speaker 1: a string twist of events. Instead of shunning the investors 661 00:38:00,680 --> 00:38:03,520 Speaker 1: are scooping it up. So just typically not the relation 662 00:38:03,640 --> 00:38:06,160 Speaker 1: that you would see a good story, good story. I 663 00:38:06,239 --> 00:38:08,680 Speaker 1: do wonder about this guy's name. Isn't Nick Carraway the 664 00:38:08,719 --> 00:38:11,800 Speaker 1: guy from the Great Gatsby the character and the Great Gatsby? 665 00:38:12,000 --> 00:38:15,239 Speaker 1: I told you I was in English major, so no, uh, 666 00:38:15,440 --> 00:38:19,200 Speaker 1: no Shakespeare, but Gatsby. Yeah, I'm not sure that's that 667 00:38:19,280 --> 00:38:21,759 Speaker 1: guy's real name, but we appreciate the contribution to the 668 00:38:21,800 --> 00:38:24,640 Speaker 1: Craziest things and as always, if you saw something crazy, 669 00:38:24,760 --> 00:38:29,439 Speaker 1: tweet to us at at Podcasts, were at Sarah where 670 00:38:29,520 --> 00:38:31,960 Speaker 1: myself and otherwise you can give us a call on 671 00:38:32,000 --> 00:38:35,279 Speaker 1: the Bloomberg Podcast hotline at six four or six three 672 00:38:35,360 --> 00:38:37,800 Speaker 1: to four three four nine, oh, and leave us a 673 00:38:37,880 --> 00:38:39,880 Speaker 1: voicemail with your crazy thing and maybe we'll play it 674 00:38:39,920 --> 00:38:42,319 Speaker 1: on the show. I think we had a great round today. 675 00:38:42,360 --> 00:38:45,279 Speaker 1: I think uh, we'll give Lizzie and the win with 676 00:38:45,400 --> 00:38:50,000 Speaker 1: the rocket and ties into markets because of velocity and momentum. Yeah, 677 00:38:50,040 --> 00:38:53,000 Speaker 1: well we'll stretch it. But it was so great to 678 00:38:53,040 --> 00:38:54,800 Speaker 1: have you on the show. Lizzie and Saunders, thank you 679 00:38:54,880 --> 00:39:07,200 Speaker 1: so much, my pleasure, thanks for having me. What goes up. 680 00:39:07,280 --> 00:39:10,480 Speaker 1: We'll be back next week. Until then, you can find 681 00:39:10,600 --> 00:39:13,760 Speaker 1: us on the Bloomberg Terminal, website and app or wherever 682 00:39:13,880 --> 00:39:16,600 Speaker 1: you get your podcasts. We'd love it if you took 683 00:39:16,640 --> 00:39:18,760 Speaker 1: the time to rate and review the show on Apple 684 00:39:18,840 --> 00:39:21,839 Speaker 1: podcast so more listeners can find us. And you can 685 00:39:21,880 --> 00:39:25,200 Speaker 1: find us on Twitter, follow me at at Sarah Pantzack, 686 00:39:25,560 --> 00:39:28,960 Speaker 1: Mike is that reaganonymous, and you can also follow Bloomberg 687 00:39:29,040 --> 00:39:33,000 Speaker 1: podcasts at Podcasts. Also thank you to Charlie Pellett of 688 00:39:33,040 --> 00:39:35,640 Speaker 1: Boomberg Radio and the voice of the New York City 689 00:39:35,719 --> 00:39:39,080 Speaker 1: subway system. What Goes Up is produced by Jordan Gospore. 690 00:39:39,520 --> 00:39:43,080 Speaker 1: The head of Bloomberg Podcast is Francesco Levie. Thanks for listening, 691 00:39:43,239 --> 00:39:44,040 Speaker 1: See you next time.