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Speaker 2: Like a financial advisor, i'd be telling people just relax, Yeah,
Speaker 2: take the long term. It'll be very good. I'm not
Speaker 2: sure if that works. But somebody who does this stuff
Speaker 2: for living, Sarah Ponzak, She's a senior vice president ubs
Speaker 2: Private Wealth Management. She used to be here with us
Speaker 2: and then she bailed on us with the Southern Florida.
Speaker 2: So I just checked Miami Weather today eighty seven and
Speaker 2: so oh so that's you, like, more power to you?
Speaker 2: Yeah what I mean, it sounds like we live in
Speaker 2: the seasons here. I don't know that. Sarah, Thank you
Speaker 2: so much for joining us. Always appreciate getting a few
Speaker 2: minutes of your time here. So what are the conversations
Speaker 2: you're having with your UVS clients these days? I mean,
Speaker 2: you see the markets whip around. They've seen, you know,
Speaker 2: news just kind of move the market as it relates
Speaker 2: to terrifs and trade policy and maybe things they haven't
Speaker 2: really thought about too much in the past. What are
Speaker 2: your conversations like with your clients.
Speaker 3: Well, it's getting very toasty down here in South Florida,
Speaker 3: so caerying up for the summer. And I think, based
Speaker 3: off your statement, Paul, you would make a great financial.
Speaker 1: Yeah, I'm sure you're having those conversations too, but no,
Speaker 1: I think it all seriousness.
Speaker 3: Just think of the month that we just came off of,
Speaker 3: the month of April. If you were someone as you
Speaker 3: know the three of us are, who was watching the
Speaker 3: markets every single day, every single moment, every single second,
Speaker 3: checking futures first thing in the morning and first you know,
Speaker 3: before bedtime, going to sleep, you pull your hair out.
Speaker 3: You would drive yourself insane. And for many of our clients,
Speaker 3: who are frankly longer term investors, they're not day traders.
Speaker 3: You know, if you would have went to bed at
Speaker 3: the beginning of April and woke up at the end,
Speaker 3: you would have missed out on a whole lot of
Speaker 3: indigestion and you could have relaxed and not driven yourself crazy.
Speaker 3: And I think it's important to put the volatility in context.
Speaker 3: Look at the end of the day, Yes, we are
Speaker 3: witnessing a sea change, and we are going to see
Speaker 3: changes to trade policy that could affect the economy, and
Speaker 3: very well probably will affect the economy. But if you
Speaker 3: put volatility into context and you think about the stock
Speaker 3: market and how much volatility you typically witness as an investor,
Speaker 3: I mean, since nineteen ninety eight, just to put some
Speaker 3: numbers in front of you, we've seen nineteen years with
Speaker 3: intry year drawdowns greater than ten percent, and yet in
Speaker 3: twenty one of those twenty seven years, we finished the
Speaker 3: year higher. Stocks finished the year higher. And if you
Speaker 3: put that in percentage terms, because maybe that's easier to
Speaker 3: visualize it, that's seventy percent of years we saw injury,
Speaker 3: your draw greater than ten percent, and in eighty percent
Speaker 3: of years of stock market finished the year higher. So
Speaker 3: this is part of investing. I think Warren Buffett said
Speaker 3: it very very well last weekend before announcing his retirement,
Speaker 3: and he said, if you're someone who watching a fifteen
Speaker 3: percent correction in the stock market makes you freak out,
Speaker 3: maybe you need to, you know, reassess your investment philosophy,
Speaker 3: because that's just part of being investor. Frankly, and many of.
Speaker 4: Your clients are CEOs who do have operations in China.
Speaker 4: What are they telling you? How are they being impacted?
Speaker 4: Right now?
Speaker 3: Their businesses are certainly being very impacted. We were actually
Speaker 3: in New York last week visiting a few clients. I
Speaker 3: wanted to come in to see you guys at Bloomberg,
Speaker 3: but we just had back back back meetings and I couldn't,
Speaker 3: unfortunately make it in. But you know, it's been really difficult.
Speaker 3: I spoke with one client last weekend who's the CEO,
Speaker 3: and they're in the clothing business and they import a
Speaker 3: lot of goods, as you can imagine, from China, and
Speaker 3: she said she just came off of the you know,
Speaker 3: the most difficult few weeks of her life, and the company, frankly,
Speaker 3: is facing paralysis. You know, we have one hundred and
Speaker 3: forty five percent tariffs with China right now, and companies
Speaker 3: can't operate in that environment. So it's over the next
Speaker 3: few weeks, and I'm sure that you guys have had
Speaker 3: many conversations where people have told you this, So over
Speaker 3: the next few weeks, we're really going to start to
Speaker 3: see the effects of that, and we're going to start
Speaker 3: to see empty your shelves we're going to start to
Speaker 3: see the effects of fewer you know, shifts coming into
Speaker 3: US ports bringing in goods because no one really wants
Speaker 3: to operate under a one hundred and forty five percent
Speaker 3: tariff regime. What of the expectation we have negotiations in
Speaker 3: Switzerland this weekend is that that's not going to be
Speaker 3: the end goal. We are going to see progress move
Speaker 3: at least in the right direction. No one knows what
Speaker 3: that number is going to be at the end of
Speaker 3: the day, But for you know CEOs and companies trying
Speaker 3: to operate right now, it's really become impossible because they're
Speaker 3: just waiting for some type of deal to be struck
Speaker 3: or at least there to be movement to a lower
Speaker 3: tear regime because no one can operate right now.
Speaker 2: Sir, if your clients want to diversify, where do you
Speaker 2: suggest they do that.
Speaker 3: So I think this year has been a really great
Speaker 3: opportunity to look overseas. It's the first time in a
Speaker 3: long time that we're actually seeing international stocks outperform in
Speaker 3: the United States. I don't think that means that you
Speaker 3: need to completely dump the US And yes, there's been
Speaker 3: a lot of talk about the end of US exceptionalism.
Speaker 3: I'm not sure we're necessarily on the same page of that,
Speaker 3: but still I do think it's good to make sure
Speaker 3: that you're right sizing your portfolios and you do have
Speaker 3: some exposure to international and you know, our team has
Speaker 3: been increasing our exposure to international a bit. I also
Speaker 3: think gold, even though we have seen quite the red
Speaker 3: this year, still offers a nice hedge for the worst
Speaker 3: case scenario. And having say, you know, a low mid
Speaker 3: single digit exposure to gold in portfolios isn't a bad
Speaker 3: idea either. And then bonds, you know, bonds. Yes, we're
Speaker 3: also very volatile in April, but again, if you fellosy
Speaker 3: for the beginning of April, we'll go. But at the end,
Speaker 3: you know, you didn't seem nearly as much volatility as
Speaker 3: you witnessed in FRA month, you know, based off of
Speaker 3: all the headlines, and especially seeing as though you know,
Speaker 3: our economists do expect that starting in September we could
Speaker 3: see one hundred basis points of rape cuts from the
Speaker 3: Federal Reserve. Although yes, that's it right now, we're very
Speaker 3: much in a wait and see mode. As FED Chair Powell,
Speaker 3: did you know reinsist this week? You know, that would
Speaker 3: be something that would be reinvigorating to bonds. So to
Speaker 3: bonds as well are a nice diversify if or someone
Speaker 3: who's not comfortable with, you know, the ups and downs
Speaker 3: of stock market volatility every day. And then I would
Speaker 3: add one more two private markets, private equity, private credit,
Speaker 3: private real estate. Even those are areas of the market
Speaker 3: where you're not going to be witnessing good day to
Speaker 3: day volatility of stocks, but you still might get you know,
Speaker 3: equity like returns, so you know, looking to you know,
Speaker 3: incorporate private markets into your portfolio if you're someone who
Speaker 3: can handle the illiquidity of those types of investments.
Speaker 4: At least, what's the top question you're getting from your
Speaker 4: clients now?
Speaker 3: What the heck is going on? You know, what should
Speaker 3: we be doing? I think it's so interesting in April.
Speaker 3: April was obviously a month in which we were talking
Speaker 3: to clients every day. We were fielding multiple calls every
Speaker 3: day because there was concern that has you know, ever
Speaker 3: since we've seen the rally, that's very much calmed down,
Speaker 3: which just I think is insight into investor sentiment right now.
Speaker 3: People feel pretty comfortable after the latest equity rally. Everyone
Speaker 3: wants to know what next, but unfortunately none of us
Speaker 3: have you know, insight into the administration. There was a
Speaker 3: headline that dropped this morning, you know, from President Trump
Speaker 3: talking about eighty percent taraphrase. Maybe that's the best place
Speaker 3: to be for China. I don't think anyone believes that's
Speaker 3: really where we're going to end up, but everyone wants
Speaker 3: to know what's coming next, and unfortunately known as a
Speaker 3: crystal ball. And when we are operating an environment where
Speaker 3: markets are so attuned to headlines in the day to day,
Speaker 3: that's when you really have to focus on the long term.
Speaker 3: Especially if it's a client who recently sold their business,
Speaker 3: they had a large liquidity event. They're sitting on a
Speaker 3: pile of cash, and how how do you deploy that?
Speaker 3: What's the right strategy to get that invested and not
Speaker 3: feel like you're paralyzed when the headlines are coming so
Speaker 3: quickly and there's so many twists and turns in the
Speaker 3: administration policies.
Speaker 2: Sarah, thank you so much for joining us. Always appreciate
Speaker 2: checking in with you. Sarah Ponzick good friend of Bloomberg.
Speaker 2: She's senior vice president UBS Private Wealth Management down there
Speaker 2: in South Florida, getting it done.
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Speaker 2: Shane Sissel joins US CEO Banrion Capital is SHANEA. What
Speaker 2: kind of conversations are you having with your clients today?
Speaker 2: Are they glass half full people buying or glass half
Speaker 2: empty people saying this THINGE could get even worse from here.
Speaker 5: So under the caveat that, I don't deal necessarily with
Speaker 5: individuals or even advisors that are looking broadly at markets.
Speaker 5: I kind of deal with a subset of advisors who
Speaker 5: really like to look at other ways to manage risk
Speaker 5: and portfolios, specifically through alternative strategies. The vast majority of
Speaker 5: the conversations I'm having are with advisors who are concerned
Speaker 5: about continued volatility in the market and how they can
Speaker 5: implement some risk management strategies using alternatives to kind of
Speaker 5: bolster portfolios to ride through the volatility. And that's really
Speaker 5: where our focus has been. But I think the takeaway
Speaker 5: from that is that there's increased interest from advisors and
Speaker 5: their clients and finding way to deal with what will
Speaker 5: largely be an extended period of volatility because the administration
Speaker 5: that is in power right now here is known for,
Speaker 5: you know, making kind of vast decisions, pulling them back,
Speaker 5: putting them back in, and I think that that doesn't
Speaker 5: bode well for calm markets. And so that's the kind
Speaker 5: of conversations we're having.
Speaker 2: So in the world of alternatives, which I consider kind
Speaker 2: of private equity, private credit, hedge funds that those types
Speaker 2: of things, how how do alterners fit into that kind
Speaker 2: of portfolio in the time of maybe higher uncertainty.
Speaker 5: So most of our advisors are at first and foremost
Speaker 5: looking at the easiest and quickest way to implement alternative
Speaker 5: strategies into client portfolios. So that's through ETFs and mutual
Speaker 5: funds and interval funds, mostly ETFs. At this moment, we
Speaker 5: have a suite of clients that offer ETF solutions that
Speaker 5: are hedge fund like and I think that that's kind
Speaker 5: of the key here. Private equity, private credit, that's equity
Speaker 5: and credit. At the end of the day, they may
Speaker 5: not mark to market, but they are very much influenced
Speaker 5: by what's going on in the public markets. For equity
Speaker 5: and credit. But the hedge fund like strategies are doing
Speaker 5: investment philosophies that are inherently diversifying and inherently about hedging
Speaker 5: out risk, hence hedge fund. So there are ETF mutual
Speaker 5: funds and interval fund strategies that implement those. And there
Speaker 5: are things like BTL which is an equity market neutral fund, CBLS,
Speaker 5: which is an actively managed long short equity fund, RDFI
Speaker 5: which is closed down fund arbitrage MRSK. So these are
Speaker 5: like hedge fund like strategies, and if you look at
Speaker 5: how they've performed during this period, they've actually done extraordinarily
Speaker 5: well and outperform the market. So implementing strategies that are
Speaker 5: diversifying in client portfolios is how we manage risk during
Speaker 5: bodol times.
Speaker 2: Speaking with Shane Sissel, CEO at banryun Capital, Jess.
Speaker 4: So, I actually to talk to you, Shana about your
Speaker 4: view when it comes to retail. I know it we'll
Speaker 4: have Walmart actually reporting earnings next week and we'll have
Speaker 4: a home depot lows target the following week after that,
Speaker 4: later in May. How are you viewing that? Because I
Speaker 4: know Walmart in particular was trading more like a growth
Speaker 4: stock before it's last earnings report. There are only a
Speaker 4: couple of magazeven stocks that actually had done better than
Speaker 4: that over twelve minutes span, like in Nvidia in some
Speaker 4: others like that too in Tesla. But you know, how
Speaker 4: do you view and how are you positioning when it
Speaker 4: comes to retail shares.
Speaker 5: So I'll start by saying that we have this very
Speaker 5: weird dichotomy going on with the consumer here in the US,
Speaker 5: where their confidence numbers are not great, and we're seeing
Speaker 5: sentiment with consumers really being negative, but they're spending in
Speaker 5: the retail actual spending numbers remain quite strong. So there's
Speaker 5: this weird dichotomy there that makes it hard to kind
Speaker 5: of predict how some of these retail names are going
Speaker 5: to do. Now that said, a company like Walmart, you
Speaker 5: got to look at that's a company that has some
Speaker 5: pricing power, has the ability to kind of bully around
Speaker 5: some of their suppliers. And if we continue to have
Speaker 5: above average ERA, specifically with China, where a lot of
Speaker 5: the goods, especially the lower cost goods that we have
Speaker 5: here in the US, come from China, that's going to
Speaker 5: be positive for something like Walmart. You would also intuitively
Speaker 5: think that would be good for something like Target, but
Speaker 5: Targets had some execution issues as of late, so it'll
Speaker 5: be interesting to see how that plays out. But if
Speaker 5: you look at some of the lower the lower the
Speaker 5: retail sorry retail companies that are focused on the lower
Speaker 5: income consumer, they have done well, but it's kind of
Speaker 5: the middle of the pack names that have done best.
Speaker 5: But I would I would think that if the terraiffs
Speaker 5: stayed quite high. We haven't seen that come through in
Speaker 5: the numbers yet because there was some pre ordering of
Speaker 5: increasing inventories before tariffs took place. But I think as
Speaker 5: that changes, you might see the middle income consumers start
Speaker 5: to move into the Walmarts of the world, and that
Speaker 5: would be positive for a name like Walmart. But you
Speaker 5: have to be really particular where you pick your spots
Speaker 5: in retail, because retail is a very large space and
Speaker 5: it includes names like Nike and Adidas, under Armour and
Speaker 5: some of the apparel brands, and those brands will be
Speaker 5: disproportionately impacted by the tariffs. So I would probably stay
Speaker 5: away from apparel brands, choose things of that nature, anything
Speaker 5: that is manufactured overseas, specifically in China and focus more on,
Speaker 5: like you said, like where you go to buy your
Speaker 5: groceries and things of that nature, where people are going
Speaker 5: to be wanting to save money because there's really no
Speaker 5: way to avoid the tariffs and other essential areas.
Speaker 2: Shana thanks so much for joining. Shane Sissel, she's the
Speaker 2: CEO of band reyon Capital, offering her thoughts on these markets.
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Speaker 2: Next Guess She's now popular. Heck Co part is Joanna
Speaker 2: Diego's joined us. She's a partner bomb Blocks. Where do
Speaker 2: you go? I mean, there's so much opportunity now in
Speaker 2: fixed income joinna and your ETF structure has something for everybody,
Speaker 2: it seems. Where are you seen to flows these days?
Speaker 3: Yeah?
Speaker 6: I think where we want to focus people's attention on
Speaker 6: is the income and fixed income. It's at historically high levels,
Speaker 6: and that income is really offsetting all of this volatility
Speaker 6: that we're seeing it's not twenty twenty two. So when
Speaker 6: we entered twenty twenty two, rates were at all time
Speaker 6: lows and they zoomed up in four hundred and fifty
Speaker 6: basis points that year. So bonds were under pressure, equity
Speaker 6: under pressure, and everybody was sort of figuring, like, couldn't
Speaker 6: make sense of twenty twenty two because both bonds and
Speaker 6: equities went down. So what it felt like was that
Speaker 6: bonds weren't working for you. Well, now bonds are working
Speaker 6: for you in your portfolio. They reclaimed their place as
Speaker 6: you know, protection in your portfolio. And if you look
Speaker 6: at what happened you know here to date and even
Speaker 6: in April, the equity markets were down, but bonds, even
Speaker 6: in some cases in some weeks where they were down,
Speaker 6: they were protecting your portfolio. So we want people to
Speaker 6: focus on the fact that bonds are working for you.
Speaker 6: Income is really upsetting volatility. And then you know, we
Speaker 6: think that the themes of resiliency and economic positivity are
Speaker 6: still there and I'd love to tell you about it.
Speaker 4: So what about when you're talking about short duration uish
Speaker 4: treasuries versus other corners, when you're talking about investment grade corporates,
Speaker 4: what are you seeing there.
Speaker 6: Yeah, So one thing we want to remember is that
Speaker 6: a lot of focus was on the tenure and all
Speaker 6: the volatility we saw on the tenure. I think it
Speaker 6: reversed itself over seven and a half percent in a week,
Speaker 6: I think the second we of April. So people will
Speaker 6: really nervous about the long side of the curve. And
Speaker 6: since twenty twenty two we've seen lots of bouts of
Speaker 6: volatility in the twenty year and the ten years. That's
Speaker 6: what it's supposed to do. It's supposed to reflect the
Speaker 6: uncertainty because it's a long dated bond. So people have
Speaker 6: been going to the short side, to the six month
Speaker 6: and one year because there's really attractive rates there. In April,
Speaker 6: you know, they were over four percent.
Speaker 3: They're not just a.
Speaker 6: Place to park your cash there. They are the safe
Speaker 6: haven of this of the treasury curve. What you want
Speaker 6: to do is you want to be short interest rate risk.
Speaker 6: So we recommend even in corporates that you should be
Speaker 6: shortening your interest rate risk and shorten your duration. It's
Speaker 6: it's okay to reach for corporates right now and get
Speaker 6: into high quality corporate debt, even high yield corporate debt.
Speaker 6: Benefit from the yields that are there, but take the
Speaker 6: interest rate risk out. And so that's why we recommend
Speaker 6: short corporate debt.
Speaker 2: Where are you seeing the funds flow? Because you know
Speaker 2: in your TF complex at bomb blocks, you guys have
Speaker 2: something for everybody. It seems like where you're seeing the
Speaker 2: fund flows, yes.
Speaker 6: You're seeing you're seeing flows into into corporate debt. You
Speaker 6: see a lot of movement in treasuries, it's just it's
Speaker 6: sort of where you would you would expect. Maybe some
Speaker 6: softening in high yield is what we've seen in the
Speaker 6: last week or so. We think that what you should
Speaker 6: be doing in these markets is trading in precision. So
Speaker 6: what we offer and what we explain is that now
Speaker 6: because of the ETF structure, you can actually trade the
Speaker 6: higher quality segment of high yield if you will, So
Speaker 6: you can trade triple B high yield. You're going to
Speaker 6: be able to benefit from, you know, the higher income
Speaker 6: and high yield, but you're up in quality. That's one
Speaker 6: rung down from investment grade and investment grade.
Speaker 7: We say reach all the way to triple.
Speaker 6: B because the incremental default risk of triple B is
Speaker 6: negligible compared to triple A. So you're getting all the
Speaker 6: good credit quality, plus you're getting a lift in yield
Speaker 6: in triple B space. So being able to trade these
Speaker 6: precise and lean into these precise characteristics and think fics
Speaker 6: income are really powerful. And if you haven't talked to
Speaker 6: your advisor and you don't know where your interest rate
Speaker 6: risk is in your portfolio, and you're not sure exactly
Speaker 6: how it's any different than your ag position, you know
Speaker 6: you should be asking that question.
Speaker 4: Whenever you're speaking with your clients. How are their questions
Speaker 4: different this year versus last year.
Speaker 6: I'll tell you one question we get all the time,
Speaker 6: and we talk a lot about this, and so sometimes
Speaker 6: things repeat. I heard it earlier this morning on the show, like, well,
Speaker 6: spreads are tight, so we're not going to go into corporates,
Speaker 6: We're not going to take on any credit risk. We
Speaker 6: have heard that since twenty twenty two.
Speaker 2: I'm not going to come in until I.
Speaker 6: See distress levels of spread. That's an investor that's trying
Speaker 6: to time the market. They're trying to say I want
Speaker 6: the best possible return today, and they missed all of
Speaker 6: the return from twenty twenty three to twenty twenty four.
Speaker 6: They haven't enjoyed these income levels I'm talking about. So
Speaker 6: we still hear that, We still hear I think towards
Speaker 6: the end of last year, well, spreads are tight, and
Speaker 6: when spreads are tight, what it's reflecting in corporate bonds
Speaker 6: is it's reflecting the fact that that's a positive economic
Speaker 6: outlook and there's less risk to taking on that credit risk.
Speaker 6: So if you dial down the interest rate risk and
Speaker 6: you take that credit risk, it's actually good for your portfolio.
Speaker 6: Income is offsetting the sequity of volatility.
Speaker 2: Been a good time, I mean again, the bond market
Speaker 2: are the cool kids again. Diegos, thank you so much
Speaker 2: for joining us. Joining Gayegos. She's a partner at Bond Blocks.
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday
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Speaker 2: Online jewelry retailer. I didn't know what it was the
Speaker 2: thing until we met our next guest on cour Daga.
Speaker 2: He's the CEO. His firm is called Angara a n
Speaker 2: G a R. A online retailer Encurt. Thanks so much
Speaker 2: for joining us here in studio.
Speaker 8: Thanks for having me.
Speaker 2: You're the CEO of a business, you know, kind of
Speaker 2: a global business. How are you guys in the jewelry
Speaker 2: business dealing with tariffs? Did tariffs impact the global jewelry business?
Speaker 8: Yeah, quite a bit. It's kind of the perfect storm.
Speaker 8: So diamond prices have been down forty to forty five
Speaker 8: percent over the last three years.
Speaker 2: And that's is that because of the synthetic diamonds, because.
Speaker 8: Of lab grown exactly lab lab done.
Speaker 2: Yeah, which is something I learned about.
Speaker 4: Reason Okay, I didn't realize that to make him, okay,
Speaker 4: tell us about that.
Speaker 2: Yeah.
Speaker 8: So they're chemically, physically optically identical to natural diamonds, but
Speaker 8: now ninety percent less. So they're a perfect substitute for
Speaker 8: natural So the industry has been reeling because of that.
Speaker 3: You know.
Speaker 8: De Beer's revenue in twenty twenty two was six point
Speaker 8: six billion, twenty twenty four was three point three billion,
Speaker 8: so it had and this with tariffs and with high
Speaker 8: goal prices, it's a double whammy now, so the industry
Speaker 8: is going to go through a lot in the very
Speaker 8: near term.
Speaker 4: Wow, I have so many questions. I did I realize
Speaker 4: this was a like what if.
Speaker 2: I have a question just I don't know, for Lisa
Speaker 2: and just okay, would you be indifferent to getting a
Speaker 2: versus synthetic?
Speaker 4: I'm going to ask that question that I'm curious about.
Speaker 2: Absolutely the same, But is.
Speaker 7: It as strong? Does it last as long?
Speaker 4: Like?
Speaker 7: Hey, how durable as real diamond on my finger and
Speaker 7: it's lasted me twenty five years so far?
Speaker 3: Yeah, I mean, will they last?
Speaker 8: It's the same thing. So there's not a jeweler in
Speaker 8: the world with a loop that could tell the difference chemically, physically,
Speaker 8: optically identical boat tens on the mow Scille. Yeah, it's
Speaker 8: still the hard substance on earth.
Speaker 2: Absolutely. So I go back to the question mischief or
Speaker 2: to say, hey, I've got this beautiful rain, but it's
Speaker 2: not real.
Speaker 7: I would be all for it. Okay, Yeah, I would,
Speaker 7: because it's more affordable option.
Speaker 2: I gotta say.
Speaker 4: Interesting, I don't know, I think I want this is
Speaker 4: a year I would think.
Speaker 2: All right, let's get back to the business at hand.
Speaker 2: How is your business? How was the online jewelry business
Speaker 2: these days?
Speaker 8: It's still quite strong. We've seen the industry overall has
Speaker 8: been flat for the last three months, but before that
Speaker 8: we saw pretty substantial growth. We're starting to grow again now,
Speaker 8: but with uncertainty that's rising. Jewelry is interesting because it
Speaker 8: gets hit first in any downturn, and so we're a
Speaker 8: little bit we're hopeful that that doesn't happen, but we're
Speaker 8: being cautious at the moment.
Speaker 4: That's interesting too, just given the dynamic in recent years,
Speaker 4: Like what's the setup moving forward, Like what's the outlook
Speaker 4: that you see after the last few years between kind
Speaker 4: of the differences we've talked about.
Speaker 8: Yeah, so if I was to real back to COVID,
Speaker 8: COVID was amazing for the jewelry industry just in terms
Speaker 8: of people couldn't go out, they couldn't travel. All that
Speaker 8: money went to luxury goods and jewelry was a prime beneficiary.
Speaker 4: It's interesting because you're not really going anywhere, so people
Speaker 4: were still buying jewelry.
Speaker 2: That's right.
Speaker 8: There was nowhere else to put money. So yeah, and
Speaker 8: so the industry really took off at that point, and
Speaker 8: there was a moderation in twenty three twenty four after
Speaker 8: that as people started going out again, and so we're
Speaker 8: starting to see growth again now after a while so
Speaker 8: that's pretty exciting.
Speaker 2: I mean, we've seen e commerce as a percent of
Speaker 2: total retail sales just explode during the pandemic, and a
Speaker 2: lot of folks said kind of brought forward maybe ten
Speaker 2: years of that growth into the pandemic. What's the e
Speaker 2: commerce aspect, which is where you guys operate as a
Speaker 2: part of the overall jewelry business.
Speaker 8: So about twenty two percent of US sales are online,
Speaker 8: so it's a pretty big number. And as you said
Speaker 8: at the beginning, it's surprising that people buy jewelry online,
Speaker 8: but it's a far better option in terms of price.
Speaker 8: There's so many reviews out there, and you know, it's
Speaker 8: growing very quickly as an overall portion of the market.
Speaker 4: So I guess what's kind of next for you moving forward.
Speaker 8: So we're just launching in India April twenty fourth. It's
Speaker 8: a pretty exciting market for US. So just for context,
Speaker 8: So the overall jewelry industry worldwide is four hundred billion dollars,
Speaker 8: out of which eighty five billion for the US and
Speaker 8: eighty five billion for India, so they're the same size market.
Speaker 8: India is growing a lot faster at ten to fifteen
Speaker 8: percent per year. As opposed to four percent in the US.
Speaker 8: But interestingly, US GDP's thirty trillion dollars India's GDP's four
Speaker 8: point three trillion, so it's a seven x difference, but
Speaker 8: jewelry consumption is the same, which is pretty amazing.
Speaker 2: Why is that cultural?
Speaker 8: It's cultural, you know, when somebody's getting married. Jewelry is
Speaker 8: a big part of what is gifted, and people think
Speaker 8: of it as a stable asset. That's an inflation hedge,
Speaker 8: so it's an investment as much as something that's beautiful.
Speaker 2: All right, it's fascinating stuff. We love having you in
Speaker 2: our studio to learn about this business and expense. We
Speaker 2: could spend the whole timeline. Just would you take great?
Speaker 2: I would synthetic diamond versus the rear one if it's
Speaker 2: the exact same.
Speaker 4: I don't know, God, you asked it because I was
Speaker 4: figured it out. I was like, how do I broach this?
Speaker 2: Ces?
Speaker 3: All right?
Speaker 2: On Cordaga, CEO of Angara Online a jewelry and we
Speaker 2: appreciate him coming in to our studios.
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday
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Speaker 2: The newspaper segment Lisa Mintay, Lisa, what do you got
Speaker 2: for us today?
Speaker 7: All right, this is for all the space fans. I'm sorry,
Speaker 7: Tom Kin's not here exactly, okay, But this Soviet spacecraft,
Speaker 7: it is falling back to Earth after fifty three years.
Speaker 7: It's called Cosmos forty twould launched back in nineteen seventy two.
Speaker 7: So basically what happened. It was meant to travel to Venus,
Speaker 7: but then at Malfactions month foul function have to lift
Speaker 7: off and it into orbit around the Earth. So it's
Speaker 7: been orbiting. It's only about three feet in diameter, but
Speaker 7: it has this heat shield so it could actually go
Speaker 7: through the atmosphere and land on Earth. We don't know where.
Speaker 7: That's the thing, That's what I was going to ask exactly.
Speaker 7: There's no word on where. Some people have said maybe
Speaker 7: some experts from the Space Force but place it over
Speaker 7: the Gulf of Oman, northeast of Africa, but really not
Speaker 7: sure yet. But it's also the space debris because that
Speaker 7: can be a concern with things like this too, So
Speaker 7: that's another concern of it.
Speaker 2: We still have to make it. Space force is still
Speaker 2: a thing, right, yes, yes, okay, I I haven't heard
Speaker 2: anything about it since the initial on that front, but
Speaker 2: you hear.
Speaker 7: These stories of like, sometimes these things do happen in
Speaker 7: space where he does come down into people's homes. It's
Speaker 7: happened before.
Speaker 2: I live New Jersey, that's the least. Okay, a lot
Speaker 2: of things happened in Florida that you're kind of surprised about.
Speaker 7: Okay, So we go from space flight to regular flights.
Speaker 7: So this is ubs right. They're trying to cut costs
Speaker 7: in Asia. Deal making slowing because escalating trade tensions. So
Speaker 7: it's changing the global travel policy. So bankers are now
Speaker 7: not allowed to fly business class on short trips to China. Okay,
Speaker 7: so before this, they were allowed to book those business
Speaker 7: flight trips on short ships because they're actually generally lower
Speaker 7: which I didn't realize in other markets for the same distance.
Speaker 7: So you have a flight from Hong Kong to Shanghai
Speaker 7: just under three hours, right, it can cost less than
Speaker 7: five hundred dollars one way for business class.
Speaker 4: Really, so yeah, you realized there was you used to
Speaker 4: travel a lot for your job.
Speaker 2: So my investment banking, all the investments I worked for it. Generally,
Speaker 2: unless times are really tough, if your flight was five
Speaker 2: hours or more, you can fly business or first class, right, Okrect.
Speaker 2: Anything less than that was and that was generally the
Speaker 2: rule unless things were getting so were you.
Speaker 7: A flout or maybe sometimes you could go question, I.
Speaker 2: Just asked you forget, you know, so I always booked
Speaker 2: and said, oh, I'm sorry that messed up, clicked the
Speaker 2: wrong But no the day, you know, back before Bloomberg,
Speaker 2: like Bloomberg, you have to do everything yourself. There's no Secharrect,
Speaker 2: there's no assistance age. But back in investment back and
Speaker 2: I had like lots of people doing stuff. Oh wow,
Speaker 2: live in the good life. You need to be in
Speaker 2: Chicago by you know, eight am. Just do it, you know.
Speaker 2: And then I just stay here by the way. And
Speaker 2: then I got I got here a Bloomberg and I'm like,
Speaker 2: wait a minute, I got to do.
Speaker 7: This in the laptop, like okay, look here, that's how.
Speaker 2: You do it, and this is the best way. Anything else.
Speaker 7: Last one Pintures came out with their earnings, right Paul
Speaker 7: I know you're not on Pinterest, right, I actually am not.
Speaker 4: I have friends who rave about it.
Speaker 7: But okay, so this is this is the point.
Speaker 2: Okay.
Speaker 7: So what's interesting is that the CEO is saying that
Speaker 7: their big audience is actually gen Z, So that's those
Speaker 7: like so they say that's where they go to shop
Speaker 7: because they're raised on like the internet is this visual content.
Speaker 7: So basically millennials and gen X, right, we had them all,
Speaker 7: but gen Z has Pinterest so you buy, you can buy.
Speaker 2: Yeah, they different links.
Speaker 7: So it's it's very visual, it's very pretty. Like if
Speaker 7: you're redecorating, you want to go to Pinterest to get ideas.
Speaker 2: I know because my sister what she is.
Speaker 7: But they're saying it's attracting advertisers because they like that
Speaker 7: group because gen Z is the one who's starting like
Speaker 7: a lot of first like they're the first to get
Speaker 7: you know, insurance or their first credit card, Like that's
Speaker 7: a time. So they're saying they want to attract these
Speaker 7: so now advertiser coming in. That's why their shares are
Speaker 7: up this morning too.
Speaker 2: I was trying to explain to my youngest whole concept
Speaker 2: of the Yellow Pages that wasn't a thing for those
Speaker 2: come I see trucks going by that are just a
Speaker 2: plumbing because you just a comes first in the public way. Crazy.
Speaker 2: So times have changed, Steo Newspapers, thank you very much
Speaker 2: for that.
Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify,
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