1 00:00:12,880 --> 00:00:15,920 Speaker 1: Hello, and welcome to What Goes Up, a Bloomberg weekly 2 00:00:15,960 --> 00:00:20,520 Speaker 1: market podcast. I'm Sara Pantzec, reporter on the Cross Asset team, 3 00:00:20,600 --> 00:00:24,079 Speaker 1: and I'm Mike Reagan, a senior editor on the Markets team. 4 00:00:24,079 --> 00:00:27,000 Speaker 1: This week on the show, market swings are making history 5 00:00:27,120 --> 00:00:29,640 Speaker 1: by the day. This time the focus was on the 6 00:00:29,680 --> 00:00:33,360 Speaker 1: oil market, with futures prices turning negative for the first 7 00:00:33,400 --> 00:00:37,000 Speaker 1: time ever. Call it just a technical factor at play 8 00:00:37,200 --> 00:00:40,800 Speaker 1: or a warning for other assets we'll discuss, and of 9 00:00:40,840 --> 00:00:43,320 Speaker 1: course we'll close out the episode with our tradition the 10 00:00:43,360 --> 00:00:47,080 Speaker 1: craziest things we saw in markets this week. Remember, you 11 00:00:47,120 --> 00:00:49,280 Speaker 1: two can contribute to that segment. Just give us a 12 00:00:49,360 --> 00:00:53,400 Speaker 1: call on the podcast hotline at six four six three 13 00:00:53,479 --> 00:00:57,520 Speaker 1: to four three four nine oh, or tweet to us 14 00:00:58,040 --> 00:01:01,600 Speaker 1: at the at podcasts handle and maybe you'll make it 15 00:01:01,600 --> 00:01:04,160 Speaker 1: onto our show sometime. And if you have any other 16 00:01:04,240 --> 00:01:07,520 Speaker 1: questions about the show, or some criticisms of Sarah or 17 00:01:07,600 --> 00:01:14,559 Speaker 1: compliments of me, but I know that by all means, 18 00:01:14,560 --> 00:01:16,240 Speaker 1: give us a call and let us know how we're doing. 19 00:01:16,319 --> 00:01:20,000 Speaker 1: But UH very excited to introduce for the first time 20 00:01:20,040 --> 00:01:24,440 Speaker 1: on this show a guy who I consider UH to 21 00:01:24,560 --> 00:01:28,080 Speaker 1: be the happiest man on Finn Twitter, as as they 22 00:01:28,080 --> 00:01:30,560 Speaker 1: call financial Twitter. I'm sure we have a lot of 23 00:01:30,560 --> 00:01:33,480 Speaker 1: finn Twitters out there, but if you're not UH a 24 00:01:33,720 --> 00:01:37,840 Speaker 1: participant in financial Twitter, I think this guy is the 25 00:01:37,840 --> 00:01:40,720 Speaker 1: the happiest man in finch Wit, which is Sarah not 26 00:01:40,760 --> 00:01:43,039 Speaker 1: necessarily saying a lot because it's mostly a bunch of 27 00:01:43,080 --> 00:01:47,040 Speaker 1: crank pots on financial Twitter. Well, I can tell you 28 00:01:47,160 --> 00:01:49,680 Speaker 1: right now we have a nice zoom conference going. He 29 00:01:49,720 --> 00:01:53,680 Speaker 1: has the nicey virtual backdrop and he's laughing, smiling, So 30 00:01:53,720 --> 00:01:55,800 Speaker 1: he might be the happiest person on the podcast here 31 00:01:55,880 --> 00:01:58,320 Speaker 1: right now. And if you if you're not a participant 32 00:01:58,360 --> 00:02:01,720 Speaker 1: of Twitter, you might remember this guy from a very 33 00:02:01,760 --> 00:02:06,400 Speaker 1: funny Wall Street Journal story last year about how you 34 00:02:06,440 --> 00:02:10,080 Speaker 1: know Patagonia, the company that makes the famous vests that 35 00:02:10,400 --> 00:02:12,760 Speaker 1: a lot of Wall Street firms used to buy the 36 00:02:12,840 --> 00:02:15,880 Speaker 1: vests and put their logo on UH. At some point 37 00:02:15,960 --> 00:02:19,240 Speaker 1: last year, Patagonia pushed back and said they didn't want 38 00:02:19,240 --> 00:02:22,640 Speaker 1: to sort of be really associated with the finance bros anymore. 39 00:02:22,639 --> 00:02:25,920 Speaker 1: They were only gonna allow their vests to be UH 40 00:02:26,240 --> 00:02:30,440 Speaker 1: bought and and logoed by companies they deemed sort of 41 00:02:30,480 --> 00:02:33,240 Speaker 1: worthy of their brand name. So there's a funny story 42 00:02:33,240 --> 00:02:36,239 Speaker 1: in the journal on it, and the guy who ended 43 00:02:36,320 --> 00:02:40,800 Speaker 1: up being the poster child of the Patagonia vest is 44 00:02:40,840 --> 00:02:43,360 Speaker 1: our guest today. Very happy to have him here. I 45 00:02:43,400 --> 00:02:46,239 Speaker 1: think his quote was, I'll die on a hill wearing 46 00:02:46,280 --> 00:02:49,239 Speaker 1: my vest before I give it up. And Sarah, thanks 47 00:02:49,280 --> 00:02:51,519 Speaker 1: to the magic of zoom video, we can confirm he's 48 00:02:51,520 --> 00:02:54,320 Speaker 1: wearing that vest today. He has not yet died on 49 00:02:54,320 --> 00:02:58,600 Speaker 1: that but a really good, great guy, good friend of ours, 50 00:02:58,680 --> 00:03:03,239 Speaker 1: and really smart market strategist at BARED in Milwaukee. His 51 00:03:03,320 --> 00:03:06,639 Speaker 1: name is Michael Antonelli. Michael, Welcome to the show. Yeah, 52 00:03:06,720 --> 00:03:08,639 Speaker 1: I am so excited to be here with you guys. 53 00:03:08,720 --> 00:03:11,120 Speaker 1: It's always great to see some of my friends, both 54 00:03:11,120 --> 00:03:13,560 Speaker 1: at Bloomberg and kind of kind of on Twitter. I'll 55 00:03:13,560 --> 00:03:15,200 Speaker 1: say there's two things I'm gonna rep till the day 56 00:03:15,200 --> 00:03:17,600 Speaker 1: I die. One of them is Chicago style pizza. I 57 00:03:17,600 --> 00:03:19,600 Speaker 1: don't care, you know, I'm gonna rep that all the 58 00:03:19,600 --> 00:03:22,480 Speaker 1: way to the end. And I'll rep Patagonia. I thank 59 00:03:22,520 --> 00:03:24,600 Speaker 1: the Walstree Journal for its great article. It kind of 60 00:03:24,680 --> 00:03:28,119 Speaker 1: vaulted me into the number one status of of Patagonia 61 00:03:28,200 --> 00:03:31,560 Speaker 1: wears across the street. So I'm excited to be here. Great, 62 00:03:31,600 --> 00:03:33,720 Speaker 1: great day for a show. I'm super ready to go 63 00:03:35,600 --> 00:03:38,080 Speaker 1: true fashion model. I think our first fashion model, Sarah 64 00:03:38,160 --> 00:03:40,080 Speaker 1: on the show is as a matter of fact, yeah, 65 00:03:40,760 --> 00:03:43,600 Speaker 1: I'll follow you on the vest I I like a 66 00:03:43,640 --> 00:03:46,000 Speaker 1: good vest myself. But I don't know about the Chicago pizza. 67 00:03:46,040 --> 00:03:49,160 Speaker 1: I don't know. I can't I can't go with you 68 00:03:49,160 --> 00:03:52,520 Speaker 1: on that one. But Michael, I one thing I wanted 69 00:03:52,560 --> 00:03:55,720 Speaker 1: to ask you sort of to start out with is 70 00:03:55,960 --> 00:03:57,720 Speaker 1: and correct me if I'm wrong about any of this. 71 00:03:57,760 --> 00:03:59,680 Speaker 1: But I sort of view you as as like a 72 00:03:59,720 --> 00:04:03,080 Speaker 1: mark get generalists, someone who follows the macro trends, the 73 00:04:03,120 --> 00:04:06,960 Speaker 1: earnings trends. You know, you can pick out an attractive 74 00:04:07,000 --> 00:04:10,320 Speaker 1: stock based on sort of the fundamentals and valuations, that 75 00:04:10,400 --> 00:04:13,200 Speaker 1: sort of thing. What I think is interesting about the 76 00:04:13,240 --> 00:04:16,719 Speaker 1: market right now, though, is there's this whole other segment 77 00:04:17,240 --> 00:04:21,880 Speaker 1: of investors in the world focused on say, biotech and pharma, 78 00:04:22,200 --> 00:04:25,559 Speaker 1: and it's such a different world to me because it's 79 00:04:25,600 --> 00:04:29,200 Speaker 1: not at all about balance sheets or earning statements. It's 80 00:04:29,200 --> 00:04:32,000 Speaker 1: all about sort of reading the tea leaves of those 81 00:04:32,440 --> 00:04:36,400 Speaker 1: drug trials and the chances of a drug being successful, 82 00:04:36,839 --> 00:04:39,000 Speaker 1: whether or not the government will pay for it in 83 00:04:39,000 --> 00:04:41,880 Speaker 1: in Medicare programs that sort of thing. But with the virus. 84 00:04:41,920 --> 00:04:44,760 Speaker 1: What I find is fascinating is that these these worlds 85 00:04:44,760 --> 00:04:47,320 Speaker 1: have collided in a big way, and I feel like 86 00:04:47,760 --> 00:04:51,320 Speaker 1: the market as a whole now is is trading off 87 00:04:51,520 --> 00:04:55,240 Speaker 1: of farma headlines that maybe the rest of us in 88 00:04:55,320 --> 00:04:59,080 Speaker 1: sort of the general space don't necessarily understand. And the 89 00:04:59,320 --> 00:05:02,840 Speaker 1: U the news on Thursday from from Gilead is a 90 00:05:02,839 --> 00:05:05,360 Speaker 1: good example. They had that drug that that people were 91 00:05:05,400 --> 00:05:08,599 Speaker 1: hoping would be a good treatment for the virus. Turns 92 00:05:08,600 --> 00:05:12,320 Speaker 1: out that first trial UH was not as successful as 93 00:05:12,360 --> 00:05:14,520 Speaker 1: people hope, and I was described as a flop. You know. 94 00:05:14,560 --> 00:05:17,200 Speaker 1: I don't know if that's a technical pharmaceutical term, but 95 00:05:17,600 --> 00:05:19,839 Speaker 1: to me, I feel like there's this kind of stress 96 00:05:19,880 --> 00:05:25,360 Speaker 1: in the market right now between UH that general sort 97 00:05:25,400 --> 00:05:28,440 Speaker 1: of your your regular investor who looks at bounce sheets, 98 00:05:28,520 --> 00:05:32,520 Speaker 1: looks at earnings, and that other niche specialist group that 99 00:05:32,680 --> 00:05:37,440 Speaker 1: knows how the the whole biotech and drug development world 100 00:05:38,120 --> 00:05:41,039 Speaker 1: UH goes and and maybe they're you know, a better 101 00:05:41,080 --> 00:05:44,360 Speaker 1: group to to sort of be gauging the outcome of 102 00:05:44,400 --> 00:05:46,360 Speaker 1: these things. Do you am I write about that? Do 103 00:05:46,400 --> 00:05:49,240 Speaker 1: you do you get a sense that you know, sort 104 00:05:49,240 --> 00:05:51,880 Speaker 1: of the general market practitioner now is forced to be 105 00:05:51,920 --> 00:05:55,800 Speaker 1: a tourist into the pharma space. Yeah, I think you're 106 00:05:55,800 --> 00:05:57,880 Speaker 1: spot on. And what you're talking about is kind of 107 00:05:57,920 --> 00:06:01,120 Speaker 1: this notion that people are going through various levels of 108 00:06:01,160 --> 00:06:03,600 Speaker 1: expertise with almost no background in and I think I 109 00:06:03,839 --> 00:06:06,240 Speaker 1: tweeted or said the other day that you know, everybody 110 00:06:06,240 --> 00:06:09,400 Speaker 1: has gone from being a doctor to a virologist, onto 111 00:06:09,520 --> 00:06:12,960 Speaker 1: being a statistician looking at bell curves, and and you 112 00:06:12,960 --> 00:06:15,960 Speaker 1: know we're ending up in places like commodity expert now 113 00:06:16,040 --> 00:06:19,839 Speaker 1: and and biotech expert even with no expertise in that category. 114 00:06:20,400 --> 00:06:22,800 Speaker 1: Baird has a really good biotech analyst named Brian Scorney. 115 00:06:22,839 --> 00:06:24,600 Speaker 1: He was kind of on top of the Romans of 116 00:06:24,600 --> 00:06:28,720 Speaker 1: your drug kind of data when it came out, and 117 00:06:28,839 --> 00:06:30,719 Speaker 1: he was a little skeptical on it. I think most 118 00:06:31,080 --> 00:06:35,200 Speaker 1: biotech investors analysts have a kind of a healthy notion 119 00:06:35,240 --> 00:06:38,120 Speaker 1: of skepticism about them. I think that's really at their 120 00:06:38,160 --> 00:06:41,320 Speaker 1: core what makes them good. But but we're in a 121 00:06:41,400 --> 00:06:45,440 Speaker 1: situation now where the average investors, say, people who are 122 00:06:45,480 --> 00:06:47,080 Speaker 1: just at home, or people who might be looking at 123 00:06:47,120 --> 00:06:50,560 Speaker 1: the headlines, we're all looking for a quick fix. Everybody 124 00:06:50,640 --> 00:06:53,960 Speaker 1: wants out of this mess. In a hurry. So when 125 00:06:54,000 --> 00:06:55,760 Speaker 1: we see any sort of light at the end of 126 00:06:55,800 --> 00:06:57,640 Speaker 1: the tunnel, whether it be romeds of your data that 127 00:06:58,000 --> 00:07:02,719 Speaker 1: is kind of uh arnished, or whether it be hydroxychloroquin, 128 00:07:02,800 --> 00:07:05,880 Speaker 1: we're all looking for this quick fix and and we're 129 00:07:05,920 --> 00:07:09,040 Speaker 1: hoping for it where we're wanting it to happen. And 130 00:07:09,080 --> 00:07:11,640 Speaker 1: I think smart investors, like biotech analysts, say just hold 131 00:07:11,680 --> 00:07:14,120 Speaker 1: the hold, hold your horses. You're not you're not a 132 00:07:14,120 --> 00:07:17,520 Speaker 1: biotech expert. Just just wait. You have to wait, even 133 00:07:17,520 --> 00:07:20,840 Speaker 1: though we want this kind of quick answer. So we 134 00:07:20,920 --> 00:07:23,640 Speaker 1: mentioned these biotech headlines, but there's also been a huge 135 00:07:23,680 --> 00:07:28,720 Speaker 1: discussion lately of the reopening of economies county to county, 136 00:07:28,920 --> 00:07:32,160 Speaker 1: state to state. I'm interested in how you kind of 137 00:07:32,240 --> 00:07:34,720 Speaker 1: grasp onto that and think about that. Say, we do 138 00:07:34,880 --> 00:07:39,280 Speaker 1: see economies start to reopen. Sure, that sounds great to some. 139 00:07:39,280 --> 00:07:41,440 Speaker 1: Some are still nervous it's too soon. But I mean, 140 00:07:41,480 --> 00:07:44,160 Speaker 1: what next, especially as it relates to investments in the 141 00:07:44,160 --> 00:07:47,720 Speaker 1: Market's like, sure, the economy reopens, but does everything just 142 00:07:47,840 --> 00:07:50,520 Speaker 1: snap back? Are their worries of a second wave? You 143 00:07:50,600 --> 00:07:53,440 Speaker 1: having to shut down again? I mean what then? Yeah, 144 00:07:53,640 --> 00:07:55,520 Speaker 1: I'll put this take out there. I think that the 145 00:07:55,560 --> 00:07:57,400 Speaker 1: reopen is to sell the news event. I don't. I 146 00:07:57,440 --> 00:08:00,960 Speaker 1: don't think it's the answer that the markets looking for. Say. Um, 147 00:08:01,000 --> 00:08:03,160 Speaker 1: I think it's the right step to kind of see 148 00:08:03,840 --> 00:08:06,920 Speaker 1: what what what kind of next things we can open 149 00:08:06,920 --> 00:08:08,520 Speaker 1: with kind of next things that can come back online. 150 00:08:08,520 --> 00:08:09,960 Speaker 1: But I do think it's to sell the news event 151 00:08:09,960 --> 00:08:12,320 Speaker 1: for the following reason. You know a lot of your 152 00:08:12,360 --> 00:08:16,000 Speaker 1: listeners will be uh study, I have studied normalized bell curves. 153 00:08:16,120 --> 00:08:19,360 Speaker 1: Will think about bell curves is kind of the traditional shape. Um, 154 00:08:19,400 --> 00:08:21,240 Speaker 1: A lot of the models out there assume that the 155 00:08:21,280 --> 00:08:23,320 Speaker 1: coronavirus gets worse and then just gets better in a 156 00:08:23,360 --> 00:08:25,960 Speaker 1: bell shaped I think that it's gonna get kind of 157 00:08:26,000 --> 00:08:28,480 Speaker 1: better in a really long tail. Think about instead of 158 00:08:28,480 --> 00:08:30,640 Speaker 1: a perfectly symmetrical bell, the right side of the bell 159 00:08:30,680 --> 00:08:33,079 Speaker 1: is just this really long tail. So if we if 160 00:08:33,120 --> 00:08:35,720 Speaker 1: if someonere to say I'm reopening Wisconsin, tor, I'm reopening 161 00:08:35,720 --> 00:08:38,120 Speaker 1: New York tomorrow, Florida tomorrow, you know how many people 162 00:08:38,120 --> 00:08:40,760 Speaker 1: are still gonna be consumers? How many people are gonna say, 163 00:08:41,440 --> 00:08:44,080 Speaker 1: I'll go to an outdoor restaurant, but not an indoor restaurant. 164 00:08:44,080 --> 00:08:47,040 Speaker 1: So I'm I'm only a partial consumer for at least 165 00:08:47,120 --> 00:08:48,800 Speaker 1: a while. So That's why I think it's to sell 166 00:08:48,840 --> 00:08:50,800 Speaker 1: the news event. I just don't want people to think 167 00:08:50,800 --> 00:08:52,760 Speaker 1: that once we hit the reopen button that you know, 168 00:08:52,800 --> 00:08:55,800 Speaker 1: people are gonna be going to eighty thou seat stadiums 169 00:08:55,840 --> 00:08:58,000 Speaker 1: right away. I just think it's gonna be the slow slog. 170 00:08:58,320 --> 00:08:59,920 Speaker 1: Let's talk a little bit about that note in that 171 00:09:00,080 --> 00:09:02,040 Speaker 1: it could be a sell the news event, and Mike, 172 00:09:02,080 --> 00:09:04,760 Speaker 1: as is my custom, I'll pack about five questions into 173 00:09:04,840 --> 00:09:09,320 Speaker 1: one right here for you now. Right. So, so I 174 00:09:09,360 --> 00:09:13,560 Speaker 1: wonder if there's a danger that that retail capitulation is 175 00:09:13,600 --> 00:09:17,679 Speaker 1: inevitable and that could be part of that sell the news. Uh, 176 00:09:17,720 --> 00:09:21,120 Speaker 1: if we do see a reopening um and we do 177 00:09:21,200 --> 00:09:23,400 Speaker 1: see a little bit of all or not that volatility 178 00:09:23,440 --> 00:09:25,079 Speaker 1: has gone anywhere, But if we do see a pick 179 00:09:25,120 --> 00:09:28,360 Speaker 1: up and another sort of really scary dip in the 180 00:09:28,400 --> 00:09:31,960 Speaker 1: market happen, could that trigger that sort of main street 181 00:09:32,000 --> 00:09:35,440 Speaker 1: capitulation that we haven't really seen yet, but I think 182 00:09:35,679 --> 00:09:38,880 Speaker 1: which most people expect. You kind of need to really 183 00:09:38,920 --> 00:09:43,120 Speaker 1: form a solid bottom. So in part twelve of my question, 184 00:09:43,320 --> 00:09:46,960 Speaker 1: I would say, where does that sell the news take us? 185 00:09:47,040 --> 00:09:49,000 Speaker 1: Does it take us back down to that bottom we 186 00:09:49,040 --> 00:09:52,000 Speaker 1: saw in March or possibly even worse. You know, how 187 00:09:52,040 --> 00:09:55,200 Speaker 1: how bad could it get? Yeah, there's there's been a 188 00:09:55,200 --> 00:09:57,280 Speaker 1: lot of good studies on the bounce and what does 189 00:09:57,280 --> 00:09:59,440 Speaker 1: a bounce mean? What does a retest mean? You know, 190 00:09:59,480 --> 00:10:01,760 Speaker 1: guys that we follow, like Ben Carlson, like back Nick. 191 00:10:01,800 --> 00:10:04,880 Speaker 1: There's also NDR research again named Clisshold. You know, I'm 192 00:10:04,920 --> 00:10:06,599 Speaker 1: kind of consuming all this in my basement, you know, 193 00:10:06,640 --> 00:10:08,400 Speaker 1: on top of your guys and stuff, I'm consuming everybody 194 00:10:08,440 --> 00:10:11,199 Speaker 1: else's stuff. But you know, Ed Clisshold said that kind 195 00:10:11,200 --> 00:10:13,040 Speaker 1: of the sharp the sharp nature of the bounce, the 196 00:10:13,080 --> 00:10:15,040 Speaker 1: sharp nature of how far we've come off the low, 197 00:10:15,520 --> 00:10:18,320 Speaker 1: it doesn't necessarily mean we won't retest the low, right, 198 00:10:18,360 --> 00:10:20,640 Speaker 1: there's no there's no hard and fast we won't retest, 199 00:10:21,000 --> 00:10:23,960 Speaker 1: but the retests tend to be shallower. Um, this is 200 00:10:24,000 --> 00:10:27,280 Speaker 1: something NDR looks after a waterfall decline ends. You know, 201 00:10:27,360 --> 00:10:29,120 Speaker 1: what we went through in March was was basically a 202 00:10:29,160 --> 00:10:32,280 Speaker 1: waterfall decline. You know, I remember seeing back on March 203 00:10:32,360 --> 00:10:34,800 Speaker 1: twenty three a lot of a lot of really scary headlines. 204 00:10:34,840 --> 00:10:36,440 Speaker 1: I remember seeing something I think it might have been 205 00:10:36,440 --> 00:10:38,760 Speaker 1: from Bank of America Mary Lynch saying that that was 206 00:10:38,800 --> 00:10:41,160 Speaker 1: their biggest day of retail selling. We might have seen 207 00:10:41,440 --> 00:10:43,520 Speaker 1: some of that at the March twenty three lie. I 208 00:10:43,880 --> 00:10:45,800 Speaker 1: keep trying to go back to find that that tweet 209 00:10:45,840 --> 00:10:47,520 Speaker 1: or that that data point, but I remember seeing it 210 00:10:47,559 --> 00:10:49,400 Speaker 1: back then. And I always kind of go back to 211 00:10:49,440 --> 00:10:51,200 Speaker 1: Vangar because they kind of have the stickiest amount of 212 00:10:51,200 --> 00:10:54,440 Speaker 1: people in their in their kind of service. They They've 213 00:10:54,440 --> 00:10:58,000 Speaker 1: done studies about previous volatility. They did a study and 214 00:10:58,000 --> 00:11:00,319 Speaker 1: they found that, you know, during the European financial crisis 215 00:11:00,360 --> 00:11:03,600 Speaker 1: about their accounts did nothing and that's still bottomed, right, 216 00:11:03,600 --> 00:11:06,160 Speaker 1: that still had an end to the volatility, end to 217 00:11:06,200 --> 00:11:09,240 Speaker 1: the event. Uh. You know, I think the notion that 218 00:11:09,320 --> 00:11:13,200 Speaker 1: retail is in what it used to be in or 219 00:11:13,240 --> 00:11:16,120 Speaker 1: two thousand and one. I think that retail is kind 220 00:11:16,120 --> 00:11:19,559 Speaker 1: of morphed through either behavioral coaching, use of more advisors. 221 00:11:20,000 --> 00:11:22,320 Speaker 1: I think the nature of them is traded, uh not 222 00:11:22,400 --> 00:11:26,400 Speaker 1: traded has changed, um for the better, honestly for the better. Um. 223 00:11:26,480 --> 00:11:29,920 Speaker 1: I you know, we can talk about this about that low, um, 224 00:11:30,000 --> 00:11:32,200 Speaker 1: but but I do think that that was a really 225 00:11:32,200 --> 00:11:34,400 Speaker 1: panicky low. I think there was a lot of stuff 226 00:11:34,440 --> 00:11:37,840 Speaker 1: that you would expect in the low that happened on Marche. 227 00:11:37,880 --> 00:11:40,280 Speaker 1: But my my notion of sell the news, I think 228 00:11:40,280 --> 00:11:41,960 Speaker 1: you can you can sell the news could be a 229 00:11:41,960 --> 00:11:44,559 Speaker 1: grind sideways. Uh, it could be you know, another pull 230 00:11:44,600 --> 00:11:46,240 Speaker 1: back towards the low. I just, I just I'm not 231 00:11:46,280 --> 00:11:48,200 Speaker 1: in the camp that we're going to retest that that 232 00:11:48,240 --> 00:11:52,080 Speaker 1: march fully, I guess so along those lines, and what 233 00:11:52,120 --> 00:11:55,520 Speaker 1: could potentially happen, whether that's capitulation or something else to 234 00:11:56,200 --> 00:11:58,240 Speaker 1: bring back a little bit of panic or bring back 235 00:11:58,280 --> 00:12:01,880 Speaker 1: some selling. Next week, we have earnings from the likes 236 00:12:01,880 --> 00:12:06,840 Speaker 1: of Google Parent Alphabet, Amazon, Facebook, Google, And something that's 237 00:12:06,840 --> 00:12:10,240 Speaker 1: really stood out to me throughout this market resilience has 238 00:12:10,360 --> 00:12:13,679 Speaker 1: just been this performance of mega cap large cap companies. 239 00:12:13,720 --> 00:12:16,640 Speaker 1: Amazon short has its own reasons. Microsoft, you could say 240 00:12:16,679 --> 00:12:20,200 Speaker 1: use of its cloud services as really in vogue right now. 241 00:12:20,640 --> 00:12:23,040 Speaker 1: But someone said to me at some point over the 242 00:12:23,080 --> 00:12:26,200 Speaker 1: past week or so that to him, he thinks that 243 00:12:26,240 --> 00:12:29,960 Speaker 1: these megacap earnings, surprising to the downside and not standing 244 00:12:30,040 --> 00:12:31,880 Speaker 1: up as much as people hope or think they will, 245 00:12:32,320 --> 00:12:35,560 Speaker 1: could actually be a larger risk at this point than 246 00:12:35,800 --> 00:12:39,160 Speaker 1: some of the coronavirus news coming out in the weeks 247 00:12:39,160 --> 00:12:41,200 Speaker 1: to come. Would you agree with that? Are are you 248 00:12:41,240 --> 00:12:43,679 Speaker 1: a little bit worried at all over the strength of 249 00:12:43,720 --> 00:12:46,440 Speaker 1: the mega cap companies. Yeah, that really, it's it's a 250 00:12:46,440 --> 00:12:48,160 Speaker 1: really relevant point. There's been a lot of stuff on 251 00:12:48,160 --> 00:12:51,640 Speaker 1: this recently too that if we maybe we'll talk about 252 00:12:51,640 --> 00:12:54,240 Speaker 1: oil later. We should probably talk about oil. But you know, 253 00:12:54,840 --> 00:12:57,320 Speaker 1: for the market to retest the lows, you have to 254 00:12:57,559 --> 00:13:00,679 Speaker 1: have a big hit to the biggest compas because they 255 00:13:00,679 --> 00:13:03,320 Speaker 1: are such a huge weight to the SMP five hunter. 256 00:13:03,400 --> 00:13:07,120 Speaker 1: Right now, the the the energy sectors three of the spire, 257 00:13:07,200 --> 00:13:10,040 Speaker 1: and it has crashed, right the energy sector is basically crashed. 258 00:13:10,400 --> 00:13:12,800 Speaker 1: You know, you wouldn't look to a three weight to 259 00:13:12,840 --> 00:13:14,719 Speaker 1: be more of the downside, you know what I mean. 260 00:13:14,840 --> 00:13:17,960 Speaker 1: So yeah, in order for the downside to be retested, 261 00:13:18,240 --> 00:13:20,880 Speaker 1: the big big megacap tech have to be hit, which 262 00:13:20,880 --> 00:13:25,160 Speaker 1: means that investors views of they're they're both you know, 263 00:13:25,240 --> 00:13:27,319 Speaker 1: six months to twelve months to one to one and 264 00:13:27,360 --> 00:13:30,319 Speaker 1: a half year performance has to be ratcheted lower. UM. 265 00:13:30,400 --> 00:13:32,800 Speaker 1: You need the Apples and the Amazons and the facebooks 266 00:13:32,800 --> 00:13:36,440 Speaker 1: and the Googles to all lead the way lower UM, 267 00:13:36,480 --> 00:13:38,440 Speaker 1: which right now we're just not seen that they tend 268 00:13:38,480 --> 00:13:41,160 Speaker 1: to be UM places people hide out in at least 269 00:13:41,200 --> 00:13:43,880 Speaker 1: for now. So yeah, he's right, You're right, there has 270 00:13:43,920 --> 00:13:46,560 Speaker 1: to be a change in expectations around it's called the 271 00:13:46,600 --> 00:13:50,000 Speaker 1: top fifteen companies in the sp order for that retest 272 00:13:50,040 --> 00:13:52,840 Speaker 1: to really accelerate. Like, I also wonder, you know, like 273 00:13:52,880 --> 00:13:55,640 Speaker 1: you said that the big fang stocks UM at least 274 00:13:55,640 --> 00:13:59,839 Speaker 1: it definitely Amazon, Netflix, um, you know the others to 275 00:14:00,040 --> 00:14:02,240 Speaker 1: some degree. There there's certainly a haven out a time 276 00:14:02,280 --> 00:14:04,560 Speaker 1: like this, which which makes sense. Now everyone's buying more 277 00:14:04,600 --> 00:14:08,920 Speaker 1: on Amazon, You're we're watching more Netflix. Their subscriber numbers 278 00:14:08,920 --> 00:14:12,640 Speaker 1: were crazy good this week. But I wonder if if 279 00:14:12,679 --> 00:14:17,559 Speaker 1: the sentiment does turn to uh, putting the virus behind 280 00:14:17,679 --> 00:14:20,320 Speaker 1: us and and getting back to those cyclical stocks, could 281 00:14:20,360 --> 00:14:24,360 Speaker 1: we have like a really nasty value growth rotation that 282 00:14:24,360 --> 00:14:27,280 Speaker 1: would see those mega cap stocks really take it on 283 00:14:27,360 --> 00:14:30,160 Speaker 1: the chin. If people start piling into the value in 284 00:14:30,240 --> 00:14:33,000 Speaker 1: the banks and the energy. Yeah, you'd have to see 285 00:14:33,040 --> 00:14:35,880 Speaker 1: just a massive ramp and growth expectations for that. I 286 00:14:35,880 --> 00:14:38,120 Speaker 1: think that trade to play out. Um. I always said, 287 00:14:38,160 --> 00:14:40,760 Speaker 1: you know, small cap starts out performing when the yield 288 00:14:40,760 --> 00:14:45,120 Speaker 1: curve really steepens, when people's growth expectations really start to rise. H. 289 00:14:45,200 --> 00:14:47,720 Speaker 1: You know one of my partners, uh, Willie Delwitz, who 290 00:14:47,760 --> 00:14:49,800 Speaker 1: kind of we kind of work together, He's looking at 291 00:14:50,040 --> 00:14:51,880 Speaker 1: h copper and he's looking at ten ure yields for 292 00:14:52,080 --> 00:14:54,400 Speaker 1: for what you're saying, right if in order for this 293 00:14:54,480 --> 00:14:57,840 Speaker 1: to be a meaningful bounce, you want bigger breadth, and 294 00:14:57,880 --> 00:15:00,640 Speaker 1: then you want to see some of the cyclicals do better. Um, 295 00:15:00,680 --> 00:15:02,600 Speaker 1: you know, the people hiding out in the in the 296 00:15:02,640 --> 00:15:05,320 Speaker 1: mega cap tech stocks. You know, I think even going 297 00:15:05,360 --> 00:15:08,440 Speaker 1: back to the pre Corona to days, you know, I'm 298 00:15:08,480 --> 00:15:10,440 Speaker 1: sure I've read pretty articles from you guys saying what 299 00:15:10,480 --> 00:15:12,960 Speaker 1: happens if this gets hit and this and small caps go? Yeah, 300 00:15:13,040 --> 00:15:15,360 Speaker 1: that's one of those, Like you know, we always kind 301 00:15:15,360 --> 00:15:17,720 Speaker 1: of circles around us. What happens when small does well 302 00:15:17,760 --> 00:15:20,080 Speaker 1: in Apple and Amazon? Don't you know you need this 303 00:15:20,240 --> 00:15:23,160 Speaker 1: massive surge and growth expectations and you'd want to look 304 00:15:23,200 --> 00:15:26,040 Speaker 1: towards copper and tenure to sniff that out. And that's 305 00:15:26,080 --> 00:15:29,800 Speaker 1: just not happening yet. Um. But but yes, people are 306 00:15:29,840 --> 00:15:32,480 Speaker 1: crowded into that space, crowded into that Yeah, as you say, 307 00:15:32,480 --> 00:15:34,840 Speaker 1: crowded trades can can last a lot lot longer than 308 00:15:34,840 --> 00:15:53,120 Speaker 1: people expect. I guess, Sarah, you know, uh as Michael 309 00:15:53,120 --> 00:15:56,920 Speaker 1: alluded to, when you alluded to at the beginning, Um, 310 00:15:56,960 --> 00:15:59,400 Speaker 1: you know, every week we talked about the craziest things 311 00:15:59,440 --> 00:16:02,520 Speaker 1: we've seen in markets this week. I think this week 312 00:16:02,560 --> 00:16:05,000 Speaker 1: we all saw the craziest thing anyone's ever seen in 313 00:16:05,040 --> 00:16:08,480 Speaker 1: any of our lifetime. Uh so let's skip ahead of that. 314 00:16:08,560 --> 00:16:11,360 Speaker 1: And of course, uh listener kind of front ran us 315 00:16:11,360 --> 00:16:14,720 Speaker 1: on all of it, and and phoned in a voicemail 316 00:16:15,200 --> 00:16:17,840 Speaker 1: to tell us exactly what happened in case you missed it. 317 00:16:17,880 --> 00:16:21,200 Speaker 1: I don't know who missed this. I think even someone 318 00:16:21,200 --> 00:16:24,720 Speaker 1: who hasn't thought of stock since since nine probably probably 319 00:16:25,080 --> 00:16:28,360 Speaker 1: read about this. But let's listen to that voicemail to 320 00:16:28,360 --> 00:16:32,800 Speaker 1: to clear it up. Hi, this is Charlie Ford. Craziest 321 00:16:32,840 --> 00:16:36,440 Speaker 1: thing a son on Wall Street. Looking at the terminal here, 322 00:16:37,080 --> 00:16:45,800 Speaker 1: the um spot crude is at uh negative thirty five 323 00:16:45,920 --> 00:16:50,280 Speaker 1: bucks or some negative thirty seven point six three and 324 00:16:50,440 --> 00:16:54,200 Speaker 1: the front month contract is a negative two dollars and 325 00:16:54,280 --> 00:16:59,440 Speaker 1: forty seven cents. Now that's pretty crazy. Thank you. You 326 00:16:59,480 --> 00:17:00,800 Speaker 1: know what. I love of Mike that we got a 327 00:17:00,880 --> 00:17:04,840 Speaker 1: call in real time too as this was happening. He decided, 328 00:17:04,880 --> 00:17:07,360 Speaker 1: you know what, I've gotta pick up the phone, call 329 00:17:07,480 --> 00:17:09,919 Speaker 1: Mike and Sarah and let them know how crazy I 330 00:17:09,960 --> 00:17:13,199 Speaker 1: think spot crude at negative forty of barrel. That's right. 331 00:17:13,240 --> 00:17:15,360 Speaker 1: I like that instinct. I also like the guy's name, 332 00:17:15,440 --> 00:17:18,639 Speaker 1: Charlie Ford. Uh, that's the guy who killed Jesse James 333 00:17:18,640 --> 00:17:21,200 Speaker 1: if I'm not mistaken back in the in the wild West. 334 00:17:21,240 --> 00:17:24,200 Speaker 1: So we'll assuming that's this guy's real name. You never know, 335 00:17:24,760 --> 00:17:28,680 Speaker 1: But Mike, I mean, were you did your eyes pop 336 00:17:28,720 --> 00:17:30,440 Speaker 1: out of your head watching that all go down? I 337 00:17:30,880 --> 00:17:33,640 Speaker 1: can't imagine. Was the phone ringing off the hook with 338 00:17:33,640 --> 00:17:36,080 Speaker 1: with clients? How do you how do you handle a 339 00:17:36,160 --> 00:17:39,159 Speaker 1: day like that? Yeah, you guys have awesome listeners. I 340 00:17:39,200 --> 00:17:41,879 Speaker 1: love that they're calling in real time watching watching crude 341 00:17:41,960 --> 00:17:46,320 Speaker 1: oil get absolutely pummeled. You know, I I treated commodities 342 00:17:46,359 --> 00:17:48,359 Speaker 1: for a couple of years. I've traded equities, I've treated 343 00:17:48,359 --> 00:17:50,760 Speaker 1: all sorts of products. I never thought I would see 344 00:17:50,760 --> 00:17:53,159 Speaker 1: anything like that day. There's just really no words. I 345 00:17:53,359 --> 00:17:56,240 Speaker 1: think I tweeted that the thing that was taking Somebody said, 346 00:17:56,240 --> 00:17:58,560 Speaker 1: what's gonna take the biggest hit due to negative crude prices? 347 00:17:58,560 --> 00:18:01,280 Speaker 1: And I said, literally every of these productivity on finton, 348 00:18:01,920 --> 00:18:05,560 Speaker 1: I think all it's it's it's definitely due to the 349 00:18:05,640 --> 00:18:09,640 Speaker 1: kind of nature of futures contracts, how how futures contracts expire, 350 00:18:09,720 --> 00:18:13,600 Speaker 1: what delivery means. It's definitely a quirk of how oil works. 351 00:18:14,160 --> 00:18:16,160 Speaker 1: You know, we we probably need to talk about why 352 00:18:16,200 --> 00:18:18,600 Speaker 1: oil is doing what it's doing from a spy demand perspective, 353 00:18:18,600 --> 00:18:20,000 Speaker 1: but I'd love to hear from you guys what you 354 00:18:20,040 --> 00:18:22,800 Speaker 1: were thinking. I was just staring at my screen. No stop. Yeah, 355 00:18:22,880 --> 00:18:25,560 Speaker 1: it was like once we hit zero, the dam just 356 00:18:25,640 --> 00:18:28,840 Speaker 1: broke and it was really hard to just stop watching. 357 00:18:28,880 --> 00:18:31,280 Speaker 1: And I feel like there was so much discussion about 358 00:18:31,320 --> 00:18:33,680 Speaker 1: this being a technical issue that's really being due to 359 00:18:33,720 --> 00:18:37,080 Speaker 1: the fact that there's nowhere to store oil right now. 360 00:18:37,080 --> 00:18:39,160 Speaker 1: But you bring up the point, Mike, I mean, what's 361 00:18:39,200 --> 00:18:42,520 Speaker 1: actually driving this supply demand and balance? And I wonder, 362 00:18:43,040 --> 00:18:45,440 Speaker 1: what's to say that this isn't going to happen again. 363 00:18:45,520 --> 00:18:47,919 Speaker 1: I mean, what's going to happen to the demand picture 364 00:18:48,119 --> 00:18:50,040 Speaker 1: or the supply picture in the next month or the 365 00:18:50,080 --> 00:18:52,680 Speaker 1: next two months, or whatever it may be, to say 366 00:18:52,720 --> 00:18:55,679 Speaker 1: that this can't repeat itself right? Well, you know what 367 00:18:55,480 --> 00:18:58,399 Speaker 1: I found amazing about it is, Uh, it was in 368 00:18:58,440 --> 00:19:01,640 Speaker 1: one of our chat rooms or work chat rooms. Uh. 369 00:19:01,720 --> 00:19:04,320 Speaker 1: And I think the price had gotten to like, I 370 00:19:04,320 --> 00:19:06,920 Speaker 1: don't know, four or three dollars, and I typed in 371 00:19:06,960 --> 00:19:09,320 Speaker 1: there I was like, is it allowed to trade negative? 372 00:19:09,320 --> 00:19:11,000 Speaker 1: You know, I didn't know if the the CME would 373 00:19:11,040 --> 00:19:15,520 Speaker 1: actually allow the contract to trade negative. UM. Probably about 374 00:19:15,800 --> 00:19:19,320 Speaker 1: five minutes later, I think someone on the OURT Commodities 375 00:19:19,320 --> 00:19:22,560 Speaker 1: team had the same question and emailed the CMME and said, 376 00:19:22,560 --> 00:19:24,679 Speaker 1: are you gonna let this thing go negative? And then 377 00:19:24,720 --> 00:19:26,920 Speaker 1: we had that hot sticky head on the terminal saying 378 00:19:26,960 --> 00:19:30,600 Speaker 1: Sime says, we'll let it go negative, and almost instantly 379 00:19:30,760 --> 00:19:33,160 Speaker 1: is when it actually went negative. So traders, I think 380 00:19:33,200 --> 00:19:35,120 Speaker 1: didn't know if they could put in a negative bid 381 00:19:35,200 --> 00:19:38,320 Speaker 1: or a negative offer, and it's almost like they got 382 00:19:38,320 --> 00:19:41,359 Speaker 1: that permission to do it and it went negative. And 383 00:19:41,400 --> 00:19:45,159 Speaker 1: I'm not sure every brokerage house out there, uh or 384 00:19:45,200 --> 00:19:49,320 Speaker 1: every you know, the trading platform that trades futures was 385 00:19:49,359 --> 00:19:51,800 Speaker 1: even prepared for this, to be honest, It's it's such 386 00:19:51,800 --> 00:19:54,960 Speaker 1: an unbelievable scenario. You know. One of the things we 387 00:19:54,960 --> 00:19:56,399 Speaker 1: had we had a lot of advisors calling us, we 388 00:19:56,440 --> 00:19:58,680 Speaker 1: had a lot of clients calling us. UM. I think 389 00:19:58,880 --> 00:20:00,760 Speaker 1: one of the things that you guys probably talk about 390 00:20:00,800 --> 00:20:02,359 Speaker 1: or we need to talk about more is you know 391 00:20:02,480 --> 00:20:04,959 Speaker 1: USO the E t F. I don't think retail investors 392 00:20:05,040 --> 00:20:08,199 Speaker 1: understand how it works, Uh, why it did does what 393 00:20:08,280 --> 00:20:09,480 Speaker 1: it does. I think a lot of the e t 394 00:20:09,800 --> 00:20:12,560 Speaker 1: s that have to deal with future's curves, whether it's 395 00:20:12,600 --> 00:20:16,439 Speaker 1: volatility or crude, um, people just don't understand them. They 396 00:20:16,480 --> 00:20:18,720 Speaker 1: just I just don't understand them. I think it's important 397 00:20:18,760 --> 00:20:21,119 Speaker 1: for for advisors and people to get educated on them 398 00:20:21,119 --> 00:20:23,600 Speaker 1: before they use them. Um. But look, I'm measuring my 399 00:20:23,640 --> 00:20:25,359 Speaker 1: car usage in miles per week right now, you know, 400 00:20:25,400 --> 00:20:27,640 Speaker 1: gallons per week, So I get what crud is doing. 401 00:20:27,680 --> 00:20:30,240 Speaker 1: What it's doing. It's you know, there's there's so much 402 00:20:30,240 --> 00:20:32,000 Speaker 1: of it. Saudi started a price war, which just it's 403 00:20:32,000 --> 00:20:34,639 Speaker 1: like a worst case scenario here. You know, Like I 404 00:20:34,720 --> 00:20:37,639 Speaker 1: keep hearing that old phrase the tipping point again, you know, 405 00:20:37,680 --> 00:20:41,600 Speaker 1: the old Malcolm Gladwell concept about how certain events in 406 00:20:41,680 --> 00:20:45,240 Speaker 1: history can really just trigger a permanent change in the 407 00:20:45,240 --> 00:20:49,760 Speaker 1: white things work and crude going negative to me, you know, 408 00:20:49,840 --> 00:20:53,760 Speaker 1: seems like it blows up basically every risk model ever written. 409 00:20:53,920 --> 00:20:57,560 Speaker 1: So so that's one another tipping point I keep thinking about. 410 00:20:57,720 --> 00:21:01,280 Speaker 1: Is the the commercial real estate. You know, every company, 411 00:21:01,600 --> 00:21:07,480 Speaker 1: major corporation out there has uh basically discovered that they 412 00:21:07,480 --> 00:21:09,959 Speaker 1: can get away pretty well with a lot of their 413 00:21:10,000 --> 00:21:12,600 Speaker 1: couple you know, employees working at home. Maybe we don't 414 00:21:12,640 --> 00:21:15,400 Speaker 1: need all that real estate. I'm curious, you know how 415 00:21:15,440 --> 00:21:18,600 Speaker 1: you're viewing this whole event in through the prism of 416 00:21:19,320 --> 00:21:22,280 Speaker 1: permanent changes and sort of winners and losers on the 417 00:21:22,280 --> 00:21:24,760 Speaker 1: other side of this. I mean, do you agree like 418 00:21:24,800 --> 00:21:26,840 Speaker 1: those two things are tipping points? Are there any other 419 00:21:26,880 --> 00:21:30,960 Speaker 1: sort of permanent changes you could see coming out of this? Yeah, 420 00:21:31,040 --> 00:21:33,080 Speaker 1: I I talk about it. I talked about this with 421 00:21:33,119 --> 00:21:34,600 Speaker 1: our clients all the time. I kind of put a 422 00:21:34,640 --> 00:21:36,560 Speaker 1: slide deck together recently where I talk about things that 423 00:21:36,600 --> 00:21:38,400 Speaker 1: I think will be the same, things that I think 424 00:21:38,400 --> 00:21:40,320 Speaker 1: will be different. You're right, there's there's lots of things 425 00:21:40,359 --> 00:21:43,000 Speaker 1: that have probably hit tipping points. Uh. You know, the 426 00:21:43,040 --> 00:21:45,120 Speaker 1: optimists and me thinks when you're when you're talking about 427 00:21:45,119 --> 00:21:48,080 Speaker 1: this work from home, that that companies going forward will 428 00:21:48,080 --> 00:21:51,119 Speaker 1: be able to hire people anywhere much more so than 429 00:21:51,160 --> 00:21:52,840 Speaker 1: they used to in the past. I think smart, thoughtful 430 00:21:52,840 --> 00:21:55,680 Speaker 1: companies always knew they could hire talent kind of outside 431 00:21:55,720 --> 00:21:59,080 Speaker 1: of their geographic area. But um, the the optimist in me, 432 00:21:59,160 --> 00:22:01,359 Speaker 1: the long term optimist, says, maybe this solves a lot 433 00:22:01,400 --> 00:22:03,680 Speaker 1: of our housing issues where you don't need to crowd 434 00:22:03,720 --> 00:22:05,359 Speaker 1: into the Bay Area to work for a tech company. 435 00:22:05,680 --> 00:22:08,960 Speaker 1: Maybe you know, I could be a Bloomberg reporter from Wisconsin, 436 00:22:09,040 --> 00:22:10,880 Speaker 1: or I could be a Bloomberg reporter from anywhere. I think, 437 00:22:11,200 --> 00:22:13,400 Speaker 1: uh that that mobility of talent, I think is probably 438 00:22:13,480 --> 00:22:15,960 Speaker 1: hit a tipping point and that's a good thing. Uh 439 00:22:16,000 --> 00:22:18,160 Speaker 1: what else has changed? I'd want to be along suburban 440 00:22:18,160 --> 00:22:20,720 Speaker 1: real estate right now, to be honest. You know, you're 441 00:22:20,760 --> 00:22:22,879 Speaker 1: in an apartment in in a big city, and the 442 00:22:22,920 --> 00:22:24,800 Speaker 1: hospitals are kind of crowded. You have a you have 443 00:22:24,800 --> 00:22:27,919 Speaker 1: a kid, and you have no balcony. You can't go 444 00:22:27,960 --> 00:22:30,560 Speaker 1: to the park because you're kind of afraid. I think 445 00:22:30,560 --> 00:22:33,439 Speaker 1: people's views about urban living versus suburban living. We're not 446 00:22:33,440 --> 00:22:36,400 Speaker 1: gonna completely online, but maybe at the margin you kick 447 00:22:36,440 --> 00:22:38,680 Speaker 1: a few more people into the suburbs that maybe thought 448 00:22:38,680 --> 00:22:41,920 Speaker 1: they were never gonna leave. Um. I think investing probably 449 00:22:42,000 --> 00:22:45,000 Speaker 1: is one of those things that might change. Pre COVID, 450 00:22:45,080 --> 00:22:47,479 Speaker 1: I think we were in a tenure bowl market. There 451 00:22:47,560 --> 00:22:49,399 Speaker 1: might have been people have thought I could handle yne 452 00:22:49,400 --> 00:22:52,600 Speaker 1: equity portfolio and they learned that they can't. I think 453 00:22:52,600 --> 00:22:54,520 Speaker 1: the reason we invest will always stay the same, which 454 00:22:54,520 --> 00:22:57,119 Speaker 1: is to kind of grow, uh grow our our life 455 00:22:57,119 --> 00:22:58,840 Speaker 1: and to say for things that will stay the same. 456 00:22:58,840 --> 00:23:01,080 Speaker 1: But the way we invest, how many equities we hold, 457 00:23:01,160 --> 00:23:03,080 Speaker 1: might might have hit a tipping point that takes a 458 00:23:03,080 --> 00:23:05,800 Speaker 1: long time to recover. Um, there's there's lots of trends 459 00:23:05,840 --> 00:23:08,320 Speaker 1: out there at the Globalization is obviously one that may 460 00:23:08,359 --> 00:23:11,040 Speaker 1: have hit a tipping point. We we can't have of 461 00:23:11,040 --> 00:23:14,359 Speaker 1: our core components for generic drugs come from abroad. Um. 462 00:23:14,560 --> 00:23:16,680 Speaker 1: So so there there are things that I think we'll 463 00:23:16,720 --> 00:23:19,440 Speaker 1: change for the better and there are things that, um, 464 00:23:19,600 --> 00:23:21,760 Speaker 1: we'll stay the same. That there's no way we're doing 465 00:23:21,840 --> 00:23:25,200 Speaker 1: Kadell schooling online anymore. I promise you. Every parent is like, 466 00:23:25,240 --> 00:23:28,360 Speaker 1: get out of my house. There's no way is going online. 467 00:23:28,880 --> 00:23:30,240 Speaker 1: You know, it never occurred to me. I could do 468 00:23:30,280 --> 00:23:32,800 Speaker 1: my job from Wisconsin. Mike, find me a nice for 469 00:23:33,000 --> 00:23:36,840 Speaker 1: bedroom on the lakefront somewhere, and uh, yeah, you'll get 470 00:23:36,840 --> 00:23:39,440 Speaker 1: out there might be there. Yeah yeah, cost of living 471 00:23:39,440 --> 00:23:42,359 Speaker 1: cut in half. I probably exactly exactly gotta wake up 472 00:23:42,359 --> 00:23:44,600 Speaker 1: earlier though, So I don't know about that. It might 473 00:23:44,640 --> 00:23:48,040 Speaker 1: be worth the extra cost living, But Sara me, going 474 00:23:48,080 --> 00:23:50,760 Speaker 1: to Wisconsin might be the craziest thing to come out 475 00:23:50,760 --> 00:23:52,960 Speaker 1: of this. I don't know. But but what there's a 476 00:23:53,000 --> 00:23:54,800 Speaker 1: lot of crazy things coming out of this podcast. But 477 00:23:54,840 --> 00:23:56,680 Speaker 1: we all know that none of us are off the hook. 478 00:23:56,880 --> 00:24:01,800 Speaker 1: We're sharing. Charlie shared, even though Charlie Ford scooped us 479 00:24:01,840 --> 00:24:05,439 Speaker 1: in front, front, round us on the Craziest Thing, Sarah, 480 00:24:05,480 --> 00:24:07,920 Speaker 1: what what do you have to offer to the Craziest 481 00:24:07,920 --> 00:24:11,920 Speaker 1: Thing discussion? Alright? So, so mine's related and it's related 482 00:24:12,000 --> 00:24:14,600 Speaker 1: to the U s O et F discussion as well, 483 00:24:15,200 --> 00:24:19,920 Speaker 1: just to the point that retail investors are actually gravitating 484 00:24:20,240 --> 00:24:23,359 Speaker 1: to this instrument. So a couple of our colleagues had 485 00:24:23,359 --> 00:24:26,160 Speaker 1: a story out on the Bloomberg looking at robin tracks data, 486 00:24:26,240 --> 00:24:30,959 Speaker 1: so tracking data from Robin Hood, and what they found 487 00:24:31,040 --> 00:24:33,760 Speaker 1: was actually that while all of this was going on, 488 00:24:33,880 --> 00:24:37,479 Speaker 1: while USO was shuffling it's holdings, while crude was falling 489 00:24:37,520 --> 00:24:41,679 Speaker 1: below zero uh, it was actually the one of the 490 00:24:41,760 --> 00:24:45,440 Speaker 1: most actively traded securities and it was the most added 491 00:24:45,480 --> 00:24:49,120 Speaker 1: security when it comes to trading volumes. So even though 492 00:24:49,440 --> 00:24:51,960 Speaker 1: there's so many people who don't know what this thing 493 00:24:52,080 --> 00:24:54,639 Speaker 1: is actually doing, they look at the price action on 494 00:24:54,680 --> 00:24:56,560 Speaker 1: their screen and they're like, you know what, I want 495 00:24:56,600 --> 00:24:59,560 Speaker 1: a piece of that. Hopefully they didn't use that infinite 496 00:24:59,640 --> 00:25:02,159 Speaker 1: leverage that Robin Hood is famous for to pile in 497 00:25:02,200 --> 00:25:07,920 Speaker 1: the US, so that could be all right, Mike, what's 498 00:25:07,920 --> 00:25:10,399 Speaker 1: the craziest thing you saw this week? All right, I'm 499 00:25:10,400 --> 00:25:14,600 Speaker 1: gonna top both of you guys. Topping topping topping negative 500 00:25:14,640 --> 00:25:16,760 Speaker 1: oil might be kind of hard. I'm glad I got 501 00:25:16,840 --> 00:25:20,080 Speaker 1: to be on for an absolute historic moment, but I'm 502 00:25:20,080 --> 00:25:22,160 Speaker 1: gonna top it with this, which is a very popular 503 00:25:22,240 --> 00:25:25,679 Speaker 1: topic over the past week or so. Initial Claims comes 504 00:25:25,680 --> 00:25:27,600 Speaker 1: out every Thursday. It's something that all of us strategists 505 00:25:27,600 --> 00:25:29,560 Speaker 1: look at. I'm sure you guys look at it. Initial 506 00:25:29,560 --> 00:25:33,159 Speaker 1: Claims has always been most strategist desert island indicator. If 507 00:25:33,160 --> 00:25:35,719 Speaker 1: you could take one indicator with you, you're taking weekly 508 00:25:35,800 --> 00:25:38,520 Speaker 1: jobs claims. How many people are filing for unemployment? Okay, 509 00:25:38,520 --> 00:25:40,520 Speaker 1: so we know that they have been soaring over the 510 00:25:40,520 --> 00:25:44,439 Speaker 1: past up to up to April, you've seen at least 511 00:25:44,880 --> 00:25:48,200 Speaker 1: three million every week. So three million, six million, six million, 512 00:25:48,200 --> 00:25:52,600 Speaker 1: four point nine four point two in April. Incredible numbers. Historic, 513 00:25:52,760 --> 00:25:56,680 Speaker 1: It's cumulative over four million Americans. Absolute tragedy in terms 514 00:25:56,720 --> 00:25:58,600 Speaker 1: of job loss is something that we've never seen before. 515 00:25:58,800 --> 00:26:01,960 Speaker 1: Here's my craziest thing of all of those days in 516 00:26:02,000 --> 00:26:06,760 Speaker 1: a row up to April, the sp close positive all 517 00:26:06,800 --> 00:26:09,720 Speaker 1: of them, which means anytime initial jobs claims has been 518 00:26:09,720 --> 00:26:14,720 Speaker 1: at least three million, the market has closed that day positive. Um. 519 00:26:14,960 --> 00:26:16,240 Speaker 1: I will give it to Mike though. That was a 520 00:26:16,240 --> 00:26:18,480 Speaker 1: pretty good one. I think we gotta get give him 521 00:26:18,480 --> 00:26:22,760 Speaker 1: the honorary win this week is as painful as it 522 00:26:22,840 --> 00:26:26,399 Speaker 1: is for me as the judge before he even shares 523 00:26:26,480 --> 00:26:29,239 Speaker 1: his own. Yeah, yeah, it's pretty good too. Though. You know, 524 00:26:29,280 --> 00:26:33,600 Speaker 1: we we've often probably all heard of this phenomenon where 525 00:26:33,720 --> 00:26:36,879 Speaker 1: most of the market's gains come overnight, you know, the 526 00:26:36,920 --> 00:26:40,040 Speaker 1: futures rally and off hours, and then cash index catches 527 00:26:40,160 --> 00:26:42,399 Speaker 1: up with it in the morning. It's kind of a 528 00:26:42,400 --> 00:26:45,720 Speaker 1: phenomenon that's persisted for a while, but it seems to 529 00:26:45,760 --> 00:26:50,760 Speaker 1: have really gone on steroids during this uh last couple 530 00:26:50,800 --> 00:26:53,960 Speaker 1: of months. And I'll quote a Macroman calm from our 531 00:26:54,000 --> 00:26:57,720 Speaker 1: own Cameron christ who was looking into this in a 532 00:26:57,760 --> 00:27:01,760 Speaker 1: little bit of detail. He's said, while the SPI is 533 00:27:01,800 --> 00:27:06,320 Speaker 1: still down some nine since February nine, by my calculations, 534 00:27:06,840 --> 00:27:12,160 Speaker 1: futures are up a cumulative between midnight and three three 535 00:27:12,200 --> 00:27:16,080 Speaker 1: am Eastern time. Over the same time frame, so between 536 00:27:16,160 --> 00:27:19,119 Speaker 1: midnight and three am, if you're in at midnight and 537 00:27:19,160 --> 00:27:22,480 Speaker 1: out at three am. You're up, and not just since 538 00:27:22,520 --> 00:27:26,920 Speaker 1: the rebounds since the peak in February, including the bear 539 00:27:27,000 --> 00:27:31,359 Speaker 1: market and the and the rebound. I I don't I've 540 00:27:31,800 --> 00:27:34,560 Speaker 1: try to wrap my head around a million different explanations 541 00:27:34,600 --> 00:27:36,600 Speaker 1: for this, Mike, you know, I don't know. You always think, 542 00:27:37,240 --> 00:27:39,680 Speaker 1: you know, maybe it's the delta one desks on on 543 00:27:40,000 --> 00:27:44,240 Speaker 1: working the night shift somewhere, or what I got. Is 544 00:27:44,240 --> 00:27:49,800 Speaker 1: there any theory I'll take, I'll take. I'll take your 545 00:27:49,800 --> 00:27:53,280 Speaker 1: wildest I'll take the wildest conspiracy theory you got on that. 546 00:27:53,960 --> 00:27:56,800 Speaker 1: All right, here's my here's my uh, here's my wild take, 547 00:27:56,880 --> 00:28:00,159 Speaker 1: my spicy take. It's really boils down to the be 548 00:28:00,240 --> 00:28:02,480 Speaker 1: one of the most ridiculous things I've ever say. It's 549 00:28:02,520 --> 00:28:04,720 Speaker 1: just total number of hours. The markets only open for 550 00:28:04,720 --> 00:28:06,960 Speaker 1: six and a half hours during the day, and there's 551 00:28:07,080 --> 00:28:11,359 Speaker 1: more non market hours than there are hours market hours. 552 00:28:11,359 --> 00:28:14,080 Speaker 1: So I just think there's you know, there's only so 553 00:28:14,119 --> 00:28:17,000 Speaker 1: much news that can come out while we're open. Let's 554 00:28:17,000 --> 00:28:19,760 Speaker 1: say that you know, earnings, earnings, by the way, earnings 555 00:28:19,760 --> 00:28:21,600 Speaker 1: come out after the clothes. Usually they'll come out pre 556 00:28:21,720 --> 00:28:24,720 Speaker 1: the open, So you incorporate all the earnings you you 557 00:28:24,800 --> 00:28:27,520 Speaker 1: incorporate all the company data drops that are usually happened 558 00:28:27,520 --> 00:28:29,879 Speaker 1: when the markets closed. Um, there's only so much that 559 00:28:29,960 --> 00:28:31,920 Speaker 1: kind of comes out during the day, So I think 560 00:28:31,920 --> 00:28:35,720 Speaker 1: the markets better at processing things post closed pre open uh. 561 00:28:35,720 --> 00:28:38,040 Speaker 1: And it's it's more liquid, it gets priced in quicker. 562 00:28:38,280 --> 00:28:40,760 Speaker 1: There's not as much emotion in the market during the 563 00:28:40,760 --> 00:28:43,479 Speaker 1: future's hours because frankly, most people aren't even trading it. 564 00:28:43,640 --> 00:28:45,320 Speaker 1: But I think it's just a sheer. I think it's 565 00:28:45,320 --> 00:28:48,360 Speaker 1: just a function of when news it's released, how many 566 00:28:48,360 --> 00:28:51,960 Speaker 1: total hours there are both while the markets open and closed. Uh, 567 00:28:52,000 --> 00:28:54,480 Speaker 1: And then just people's reactions are are a little a 568 00:28:54,560 --> 00:28:57,200 Speaker 1: little faster to be priced in th futures markets. I 569 00:28:57,240 --> 00:29:00,640 Speaker 1: wonder too if trading limits maybe have anything to do 570 00:29:00,680 --> 00:29:03,320 Speaker 1: with it, because consider the amount of times that we've 571 00:29:03,360 --> 00:29:08,000 Speaker 1: seen futures fall down five percent immediately five minutes after 572 00:29:08,040 --> 00:29:11,240 Speaker 1: future is open, and then either there lodged there the 573 00:29:11,280 --> 00:29:12,880 Speaker 1: rest of the time or they have nowhere to go 574 00:29:12,960 --> 00:29:15,080 Speaker 1: but up once they become dislodged. So if you start 575 00:29:15,120 --> 00:29:19,160 Speaker 1: looking at midnight, maybe you can't go any lower. So 576 00:29:19,640 --> 00:29:22,920 Speaker 1: you and so you know that it's the hardest thing 577 00:29:22,920 --> 00:29:25,160 Speaker 1: for retail people to understand what future trading is it's 578 00:29:25,160 --> 00:29:27,440 Speaker 1: a question I kind of field all the time from 579 00:29:27,480 --> 00:29:30,880 Speaker 1: from individual investors. What are futures? What is pajama trators? 580 00:29:30,920 --> 00:29:33,960 Speaker 1: Why does Kramer called pajama trators? What's going on? And 581 00:29:33,960 --> 00:29:36,040 Speaker 1: and I operated in that world for at least four 582 00:29:36,120 --> 00:29:39,360 Speaker 1: or five years, a couple of jobs ago. And it's, 583 00:29:39,400 --> 00:29:42,479 Speaker 1: you know, it's it's very very thin, it's very liquid. 584 00:29:42,480 --> 00:29:44,640 Speaker 1: There's very few players. You're right, it's a lot of 585 00:29:44,640 --> 00:29:47,960 Speaker 1: Delta one desks. Uh, it's a lot of hedge funds. 586 00:29:48,360 --> 00:29:51,480 Speaker 1: It's just it's it's it's hard to put a broad 587 00:29:51,520 --> 00:29:54,040 Speaker 1: stroke on futures and say this is the opinion of 588 00:29:54,080 --> 00:29:55,640 Speaker 1: a lot of people. It's really the opinion of a 589 00:29:55,680 --> 00:29:58,080 Speaker 1: few people. And then we wake up and say, oh, 590 00:29:58,120 --> 00:30:00,280 Speaker 1: they must have been right, and it's just d of 591 00:30:00,400 --> 00:30:02,040 Speaker 1: it kind of sits, you know, it kind of sits 592 00:30:02,040 --> 00:30:04,640 Speaker 1: in place. Mike, I have no idea who this Cramer 593 00:30:04,680 --> 00:30:11,400 Speaker 1: fellow you're talking about. Is obscure somebody else. I was 594 00:30:11,440 --> 00:30:15,240 Speaker 1: hoping for something more conspiratle maybe you know, Plunge Protection 595 00:30:15,280 --> 00:30:19,120 Speaker 1: Team Carl Icons in the futures overnight. But we'll accept 596 00:30:19,160 --> 00:30:21,840 Speaker 1: Mike's answer. I guess, Sarah, honestly, if there's a Plunge 597 00:30:21,840 --> 00:30:26,600 Speaker 1: Protection team. They can we get a new round of it. 598 00:30:27,920 --> 00:30:33,160 Speaker 1: They didn't stink in. Somebody go out to Harvard or 599 00:30:33,160 --> 00:30:37,200 Speaker 1: Princetoner's hires some new people. I don't know what. Well, 600 00:30:37,640 --> 00:30:39,120 Speaker 1: a lot to think about. This was a lot of 601 00:30:39,120 --> 00:30:42,880 Speaker 1: fun both Mike's um so Michael Antonelli. We really appreciate 602 00:30:42,960 --> 00:30:45,160 Speaker 1: you coming on the show this week. Thank you guys. 603 00:30:45,160 --> 00:30:55,480 Speaker 1: It's a blast anytime I'm around What Goes Up. We'll 604 00:30:55,520 --> 00:30:58,160 Speaker 1: be back next week. Until then, you can find us 605 00:30:58,200 --> 00:31:01,200 Speaker 1: on the Bloomberg Terminal website and or wherever you get 606 00:31:01,240 --> 00:31:03,640 Speaker 1: your podcasts. We'd love it if you took the time 607 00:31:03,680 --> 00:31:06,640 Speaker 1: to rate, interview the show on Apple Podcasts so more 608 00:31:06,720 --> 00:31:09,680 Speaker 1: listeners can find us. And you can find us on Twitter, 609 00:31:10,000 --> 00:31:14,840 Speaker 1: follow me at Sarah Ponzack. Mike is a reaganonymous our guest, 610 00:31:14,960 --> 00:31:17,960 Speaker 1: Michael Antonelli is at Bowl and Beard, and you can 611 00:31:18,040 --> 00:31:22,160 Speaker 1: also follow Bloomberg Podcasts at Podcasts. What Goes Up is 612 00:31:22,200 --> 00:31:25,080 Speaker 1: produced by tober Porheas the head of Bloomberg podcast is 613 00:31:25,120 --> 00:31:28,040 Speaker 1: Francesca Levie. Thanks for listening, See you next time.