1 00:00:00,120 --> 00:00:02,800 Speaker 1: Let's get to Victoria Green see I o at G 2 00:00:02,960 --> 00:00:05,840 Speaker 1: Squared Private Wealth to take a look at what happened 3 00:00:05,880 --> 00:00:11,440 Speaker 1: today in markets. Victoria joins from College Station, Texas. Thanks 4 00:00:11,440 --> 00:00:13,440 Speaker 1: for being with us, Victoria. And it's kind of curious. 5 00:00:13,680 --> 00:00:16,800 Speaker 1: I think seventy five basis point rate hike was fully discounted. 6 00:00:16,840 --> 00:00:18,919 Speaker 1: If there was a risk, it may have been on 7 00:00:18,960 --> 00:00:22,520 Speaker 1: the possibility the Fed delivering a larger move hundred basis points? 8 00:00:22,680 --> 00:00:24,959 Speaker 1: Was that a part of this, this move higher and 9 00:00:25,040 --> 00:00:28,560 Speaker 1: risk assets today a little bit of relief, do you think? Yeah? 10 00:00:28,720 --> 00:00:30,360 Speaker 1: I mean I think people read into it and we 11 00:00:30,400 --> 00:00:32,519 Speaker 1: see this as a knee jerk rally similar to the 12 00:00:32,600 --> 00:00:34,680 Speaker 1: June hike. Or we saw a big rally day of 13 00:00:34,840 --> 00:00:36,680 Speaker 1: and then the next day we gave it back, left 14 00:00:36,920 --> 00:00:39,440 Speaker 1: to see what features priced in tomorrow. But I don't 15 00:00:39,479 --> 00:00:42,199 Speaker 1: actually think it was very delvish. So seventy five was 16 00:00:42,280 --> 00:00:44,839 Speaker 1: fully priced in. We we personally thought we should go 17 00:00:44,880 --> 00:00:47,120 Speaker 1: a hundred. We felt the market could absorb it and 18 00:00:47,120 --> 00:00:49,400 Speaker 1: the Fed could make up some ground on inflation because 19 00:00:49,400 --> 00:00:51,839 Speaker 1: they've been behind the eight ball this whole time. But 20 00:00:52,040 --> 00:00:56,000 Speaker 1: seventy five was the status quo. Market was ready for it. 21 00:00:56,160 --> 00:00:59,160 Speaker 1: You know, the remarks were not really surprising. Everything was 22 00:00:59,240 --> 00:01:02,920 Speaker 1: kind of status quo affirming we're still hawkish. I really 23 00:01:02,920 --> 00:01:05,440 Speaker 1: feel like people read into some of the flexibility on 24 00:01:05,480 --> 00:01:07,240 Speaker 1: the back end and what's going to happen in the 25 00:01:07,280 --> 00:01:11,000 Speaker 1: fall as a little more devish in the commentary really 26 00:01:11,080 --> 00:01:15,040 Speaker 1: led to belief. So, in my opinion, probably an overshoot today. 27 00:01:15,200 --> 00:01:17,640 Speaker 1: Most likely give it back because there really wasn't a 28 00:01:17,720 --> 00:01:20,160 Speaker 1: change and we're still in a hawkish fed and an 29 00:01:20,160 --> 00:01:24,080 Speaker 1: economy that seems to be slowing down. What is zero? 30 00:01:24,120 --> 00:01:26,959 Speaker 1: And on another thing that j Pal said, in terms 31 00:01:26,959 --> 00:01:29,120 Speaker 1: of what's coming next, you said, at some point it 32 00:01:29,160 --> 00:01:32,080 Speaker 1: will be appropriate to slow down. Well, that's the sort 33 00:01:32,080 --> 00:01:34,600 Speaker 1: of nice open ended statement that you can really start 34 00:01:34,640 --> 00:01:39,560 Speaker 1: speculating about. Isn't it What is some point? Yeah? Some point? Right? 35 00:01:39,680 --> 00:01:42,360 Speaker 1: Is that twenty two? Is it twenty three? Um? You 36 00:01:42,400 --> 00:01:44,600 Speaker 1: know what is a slowdown? Is it from seventy five 37 00:01:44,640 --> 00:01:49,720 Speaker 1: to fifty? Is five? Is fifty? You know that's such 38 00:01:49,760 --> 00:01:52,200 Speaker 1: a subjective terms, So I feel like that's being read 39 00:01:52,240 --> 00:01:55,000 Speaker 1: into a little bit and over emphasized. You know, I 40 00:01:55,040 --> 00:01:57,160 Speaker 1: can also say at some point I might be a 41 00:01:57,160 --> 00:01:59,600 Speaker 1: billionaire and it's probably not going to happen in the fall. 42 00:02:00,400 --> 00:02:02,520 Speaker 1: You know, it's interesting, but we get the second quarter 43 00:02:02,600 --> 00:02:05,880 Speaker 1: g D print tomorrow, the the initial print. Today's data 44 00:02:06,360 --> 00:02:09,720 Speaker 1: suggest maybe that we're not going to see much in 45 00:02:09,720 --> 00:02:13,400 Speaker 1: the way of contraction, durable goods orders, unexpected gains, the 46 00:02:13,440 --> 00:02:17,720 Speaker 1: trade deficit narrower than forecast, inventories both wholesale and retail 47 00:02:17,760 --> 00:02:20,079 Speaker 1: topping estimates. What kind of print do you think we're 48 00:02:20,080 --> 00:02:22,840 Speaker 1: gonna see tomorrow? I tend to think it's gonna be 49 00:02:23,000 --> 00:02:26,240 Speaker 1: still a downprint. Um. I think it's funny because I 50 00:02:26,280 --> 00:02:28,080 Speaker 1: look at this and say, if we're arguing about the 51 00:02:28,120 --> 00:02:31,519 Speaker 1: definition of recession, we're probably in or close to a recession, 52 00:02:31,720 --> 00:02:33,920 Speaker 1: because if you get into the semantics of it, that 53 00:02:34,000 --> 00:02:36,680 Speaker 1: means nothing good is happening and there is a slowdown. 54 00:02:36,760 --> 00:02:39,200 Speaker 1: We'll see. You know, it was a supply, a surprise, 55 00:02:39,240 --> 00:02:41,480 Speaker 1: a little bit with terrible goods. But if you look 56 00:02:41,520 --> 00:02:44,440 Speaker 1: at what was going on at June thirty, um, you 57 00:02:44,480 --> 00:02:47,760 Speaker 1: know that Q two is a pretty ugly quarter generally 58 00:02:47,760 --> 00:02:51,440 Speaker 1: speaking for production and consumption, and we got just eating 59 00:02:51,480 --> 00:02:54,639 Speaker 1: alive by inflation. To be honest, then Victoria, we've been 60 00:02:54,680 --> 00:02:57,800 Speaker 1: discussing the path that head full of fits. So in 61 00:02:57,840 --> 00:03:00,959 Speaker 1: this environment, where are you looking to with money to work. 62 00:03:01,000 --> 00:03:03,160 Speaker 1: At the moment, I guess it's fair to say things 63 00:03:03,200 --> 00:03:05,239 Speaker 1: are more challenging now than they were a year ago, 64 00:03:06,280 --> 00:03:08,079 Speaker 1: just a little bit. And I think actually it's more 65 00:03:08,160 --> 00:03:11,040 Speaker 1: challenging now than it even was in June, because you're 66 00:03:11,040 --> 00:03:13,480 Speaker 1: playing this game. Is this the rally rally? Is it's 67 00:03:13,480 --> 00:03:15,600 Speaker 1: a bear market rally? You know what is the second 68 00:03:15,639 --> 00:03:18,400 Speaker 1: half of the year going to bring. I'm still playing defense. 69 00:03:18,440 --> 00:03:21,440 Speaker 1: I'm fully aware that you know, we're watching earnings, especially 70 00:03:21,480 --> 00:03:24,040 Speaker 1: Apple and Amazon on Thursday. You know, it's been very, 71 00:03:24,160 --> 00:03:26,840 Speaker 1: very mixed, and we're concerned when you start doing the 72 00:03:26,880 --> 00:03:29,839 Speaker 1: market math. So we want to play defense. We want 73 00:03:29,880 --> 00:03:34,080 Speaker 1: companies with strong cash flows, resilient cash flows, things that 74 00:03:34,120 --> 00:03:37,360 Speaker 1: have been fairly good and a slowdown um things like 75 00:03:37,360 --> 00:03:40,119 Speaker 1: a costc your staples. I know they're a little expensive 76 00:03:40,160 --> 00:03:43,120 Speaker 1: and there's nothing sexy about a consumer staple stock, but 77 00:03:43,240 --> 00:03:45,840 Speaker 1: it is a good defensive play. And I think if 78 00:03:45,840 --> 00:03:48,880 Speaker 1: you step back today and ask yourself what really changed 79 00:03:48,960 --> 00:03:51,839 Speaker 1: in the world, nothing changed. You have all of these 80 00:03:51,880 --> 00:03:54,920 Speaker 1: macro headwinds. I think the only thing that changed is 81 00:03:54,960 --> 00:03:58,360 Speaker 1: everybody was so bearish that the market got bullish, and 82 00:03:58,400 --> 00:04:00,400 Speaker 1: that's a sentiment rally. It has not thing to do 83 00:04:00,440 --> 00:04:03,520 Speaker 1: with the fundamentals. Um. So I look around and and 84 00:04:03,600 --> 00:04:05,840 Speaker 1: let's talk. Let's talk the market math and why I'm 85 00:04:05,880 --> 00:04:08,640 Speaker 1: still defensive. So let's say we get a two twenty 86 00:04:08,720 --> 00:04:11,360 Speaker 1: five earnings on the SMP five hundred. That's still eight 87 00:04:11,360 --> 00:04:14,320 Speaker 1: percent growth that's got to be driven by mostly you know, 88 00:04:14,400 --> 00:04:17,719 Speaker 1: your tech and your discretionary stocks because of the waiting um. 89 00:04:17,760 --> 00:04:21,520 Speaker 1: If you put a seventeen handle on that, that's a thirty. 90 00:04:21,560 --> 00:04:23,760 Speaker 1: So one of the questions is where does earnings end up? 91 00:04:23,760 --> 00:04:26,279 Speaker 1: And the second question is what multiple is appropriate? And 92 00:04:26,320 --> 00:04:29,440 Speaker 1: when you start putting that math together, this rally looks 93 00:04:29,440 --> 00:04:31,560 Speaker 1: a little more tenuous than it does if you say, 94 00:04:31,560 --> 00:04:35,120 Speaker 1: well we got oversold, Yes, absolutely, we got oversold. How 95 00:04:35,200 --> 00:04:38,320 Speaker 1: much leg does this market have. I'm not really buying it. 96 00:04:38,360 --> 00:04:40,400 Speaker 1: I'm not chasing the high beta. I'm not chasing the 97 00:04:40,440 --> 00:04:43,360 Speaker 1: high multiples. Yet, I think I still want to play defense. 98 00:04:43,640 --> 00:04:45,080 Speaker 1: You know, we do like some of the oil and 99 00:04:45,120 --> 00:04:48,400 Speaker 1: gas names. I love collecting my dividends right now. You know, 100 00:04:49,080 --> 00:04:51,120 Speaker 1: und dollar barrel and oil is great for a lot 101 00:04:51,200 --> 00:04:54,400 Speaker 1: of USC and P producers. So right now it's boring, 102 00:04:54,520 --> 00:04:56,800 Speaker 1: and I'm staying boring and I'm not ready to move 103 00:04:56,800 --> 00:05:00,000 Speaker 1: off that position. I may be a little more aggressive 104 00:05:00,040 --> 00:05:02,760 Speaker 1: if we see both Apple and Amazon buck the trend. 105 00:05:03,040 --> 00:05:06,440 Speaker 1: I mean Amazon's fighting Walmart in tech that or Walmart 106 00:05:06,480 --> 00:05:10,360 Speaker 1: and Target excuse me, that had terrible earnings their best Buy, 107 00:05:10,440 --> 00:05:13,560 Speaker 1: or any of these discretionary stores. I will be interested 108 00:05:13,600 --> 00:05:15,880 Speaker 1: in Amazon conduct that trend. I don't think so. I'm 109 00:05:15,880 --> 00:05:18,120 Speaker 1: a little barish on their earnings, but they are a 110 00:05:18,200 --> 00:05:21,760 Speaker 1: very very profitable company. So are there opportunities offshore? Maybe 111 00:05:21,760 --> 00:05:23,840 Speaker 1: we need to forget about the US for a moment 112 00:05:23,880 --> 00:05:28,000 Speaker 1: and consider markets in Asia. Yeah, I think you've got 113 00:05:28,040 --> 00:05:30,680 Speaker 1: a little bit. So. China is one of those that 114 00:05:30,720 --> 00:05:33,240 Speaker 1: their zero COVID policy does make it a little difficult 115 00:05:33,279 --> 00:05:35,599 Speaker 1: for me to make an allocation there because it seems 116 00:05:35,640 --> 00:05:37,479 Speaker 1: like they can just turn it on and turn it off. 117 00:05:37,720 --> 00:05:39,640 Speaker 1: And so what's the demand, what's the g d P? 118 00:05:40,200 --> 00:05:42,240 Speaker 1: You know, what does that look like for China? It's 119 00:05:42,279 --> 00:05:45,120 Speaker 1: just such a very inconsistent growth story. Uh, you know, 120 00:05:45,160 --> 00:05:48,440 Speaker 1: I think Taiwan in the semiconductor business, obviously, Japan and 121 00:05:48,480 --> 00:05:50,599 Speaker 1: some of the tech that you can get into in Asia. 122 00:05:50,839 --> 00:05:53,159 Speaker 1: I think it's it's an interesting market. You know. One 123 00:05:53,200 --> 00:05:56,359 Speaker 1: concern is typically a strong dollar is very difficult for 124 00:05:56,400 --> 00:06:00,000 Speaker 1: emerging markets. So strong dollar is a headwind. Strong commodity 125 00:06:00,120 --> 00:06:03,400 Speaker 1: prices historically for some emerging markets is actually a good 126 00:06:03,400 --> 00:06:05,640 Speaker 1: place to be. And we are seeing even though we've 127 00:06:05,640 --> 00:06:07,680 Speaker 1: seen medals pull back and you have seen a little 128 00:06:07,680 --> 00:06:09,719 Speaker 1: bit of bus in the commodities. You know, do you 129 00:06:09,760 --> 00:06:12,080 Speaker 1: trust dr Copper? Is that is that the signal we're 130 00:06:12,080 --> 00:06:14,080 Speaker 1: gonna be looking for, Because if that's the signal, then 131 00:06:14,080 --> 00:06:17,960 Speaker 1: I'm gonna stay in my US large cops. When you 132 00:06:18,080 --> 00:06:22,640 Speaker 1: consider a journal opportunities offshore to what the greedy away 133 00:06:22,800 --> 00:06:27,520 Speaker 1: in recession risk, I think tremendously. So if you look 134 00:06:27,600 --> 00:06:31,400 Speaker 1: at and say, you know, if America sneezes, who else 135 00:06:31,440 --> 00:06:34,080 Speaker 1: gets snick sick? And it's it's almost everybody. We're so 136 00:06:34,160 --> 00:06:37,039 Speaker 1: interconnected now, and that's one of the concerns I have. 137 00:06:37,240 --> 00:06:42,000 Speaker 1: Even resilient UM countries and nations, Europe looks like it's 138 00:06:42,000 --> 00:06:44,200 Speaker 1: going to struggle this fall and winter. They're they're going 139 00:06:44,240 --> 00:06:46,120 Speaker 1: to have a bit of an energy crisis. That the 140 00:06:46,160 --> 00:06:51,159 Speaker 1: economic engine of Europe, Germany is warning and really struggling 141 00:06:51,200 --> 00:06:53,520 Speaker 1: and looking like it's gonna hit recession first. That's gonna 142 00:06:53,600 --> 00:06:56,360 Speaker 1: drag down Europe, they're gonna have this energy crisis is 143 00:06:56,360 --> 00:06:59,400 Speaker 1: a real and present threat to their economies over there. 144 00:06:59,640 --> 00:07:02,000 Speaker 1: So I look at it and I say, the biggest 145 00:07:02,080 --> 00:07:04,000 Speaker 1: risk I don't think is a US recession as the 146 00:07:04,080 --> 00:07:08,200 Speaker 1: European recession that then kind of affects everybody, and once 147 00:07:08,240 --> 00:07:10,880 Speaker 1: one of us slows down, it's very difficult for anybody 148 00:07:10,880 --> 00:07:14,040 Speaker 1: else to keep above average growth because of of of 149 00:07:14,080 --> 00:07:18,120 Speaker 1: all of the interconnected globalization. And while globalization has been 150 00:07:18,160 --> 00:07:22,440 Speaker 1: on the downtrend, the nationalization has been with the word 151 00:07:22,480 --> 00:07:25,600 Speaker 1: of the last decade. Basically, we are still very connected. 152 00:07:26,000 --> 00:07:27,960 Speaker 1: You know, look at how much we struggle when we 153 00:07:27,960 --> 00:07:30,640 Speaker 1: have a port shutdown. You know, our supply chains are 154 00:07:30,680 --> 00:07:35,480 Speaker 1: still very very interconnected. So it's Taiwan, Japan, or Australia 155 00:07:35,480 --> 00:07:38,120 Speaker 1: are going to be able to grow earn it. I 156 00:07:38,120 --> 00:07:40,960 Speaker 1: don't know, Victoria, we gotta go, Victoria Green C I 157 00:07:41,080 --> 00:07:43,160 Speaker 1: O A g squid private wealth. Thanks so much for 158 00:07:43,240 --> 00:07:45,040 Speaker 1: joining us on Bloomberg Day. Breccasion