1
00:00:00,280 --> 00:00:10,560
Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the

2
00:00:10,560 --> 00:00:14,520
Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am

3
00:00:14,560 --> 00:00:18,479
Speaker 1: Eastern on Applecarplay and Android Auto with the Bloomberg Business App.

4
00:00:18,600 --> 00:00:21,799
Speaker 1: Listen on demand wherever you get your podcasts, or watch

5
00:00:21,920 --> 00:00:23,040
Speaker 1: us live on YouTube.

6
00:00:23,400 --> 00:00:25,040
Speaker 2: All right, Matt mill is sitting in for Alex Steel

7
00:00:25,040 --> 00:00:27,560
Speaker 2: on Paul Sweeney Live here in our Bloomberg Interactive Brokers Studio,

8
00:00:27,600 --> 00:00:29,800
Speaker 2: streaming live on YouTube, as well as at Hedeverdy YouTube

9
00:00:29,840 --> 00:00:33,440
Speaker 2: dot com search Bloomberg podcast Live. What are the interesting

10
00:00:33,440 --> 00:00:35,640
Speaker 2: stories coming out of Elon Muk's And there are many

11
00:00:35,680 --> 00:00:38,760
Speaker 2: stories every single day coming from Elon Musk, so much

12
00:00:38,800 --> 00:00:42,440
Speaker 2: and so that Bloomberg has a podcast dedicated to Elon Musk. Anyway,

13
00:00:42,440 --> 00:00:45,599
Speaker 2: the latest is he's looking to, you know, do some

14
00:00:45,640 --> 00:00:49,479
Speaker 2: more race and more money at X an evaluation of

15
00:00:49,520 --> 00:00:50,640
Speaker 2: forty four billion dollars.

16
00:00:50,680 --> 00:00:52,320
Speaker 3: It seems like I've heard that number of bit.

17
00:00:52,200 --> 00:00:54,440
Speaker 4: That's how much he paid for the first place. He

18
00:00:54,600 --> 00:00:57,880
Speaker 4: really hopes to get it back there. But our story

19
00:00:57,960 --> 00:01:02,600
Speaker 4: notes that Fidelity Mare worked down its investment in X

20
00:01:02,640 --> 00:01:04,920
Speaker 4: by seventy percent in December.

21
00:01:05,080 --> 00:01:07,560
Speaker 3: Yep, exactly right, So what's changed since then? I don't know.

22
00:01:07,640 --> 00:01:11,120
Speaker 4: Let's ask President of the United States of America exactly right.

23
00:01:11,160 --> 00:01:14,080
Speaker 2: Max Chapkin joins us Bloomberg Business Week senior reporter and

24
00:01:14,200 --> 00:01:15,839
Speaker 2: co host of the Elon Inc.

25
00:01:16,000 --> 00:01:20,400
Speaker 3: Podcast. So, forty four billion dollars? What are people saying

26
00:01:20,400 --> 00:01:21,080
Speaker 3: about that number?

27
00:01:21,120 --> 00:01:23,840
Speaker 5: So, I mean, we've what we've seen is that all

28
00:01:23,920 --> 00:01:27,600
Speaker 5: of Elon Musk's companies are essentially worth more today than

29
00:01:27,600 --> 00:01:30,280
Speaker 5: they were before the election. And the reason, I mean,

30
00:01:30,319 --> 00:01:33,160
Speaker 5: you're hinting at it jokingly, but Elon Musk happens to

31
00:01:33,200 --> 00:01:35,959
Speaker 5: have a pretty good relationship with the most powerful or

32
00:01:35,959 --> 00:01:39,000
Speaker 5: one of the most powerful politicians in the world, Donald Trump,

33
00:01:39,319 --> 00:01:42,120
Speaker 5: you know, serving as a you know, senior aide to

34
00:01:42,160 --> 00:01:46,080
Speaker 5: the Trump administration in the White House, also effectively running

35
00:01:46,400 --> 00:01:49,360
Speaker 5: this effort known as the Department of Government Efficiency. You know,

36
00:01:49,480 --> 00:01:52,200
Speaker 5: right after the election, we saw the Tesla's share price

37
00:01:52,440 --> 00:01:55,680
Speaker 5: go way up. SpaceX is said to be raising money

38
00:01:55,760 --> 00:02:01,080
Speaker 5: at a big valuation increase, and XAI also raising money.

39
00:02:01,080 --> 00:02:03,800
Speaker 5: So it's sort of figure, you sort of figure that

40
00:02:04,280 --> 00:02:07,560
Speaker 5: x would at least try to explore this as a

41
00:02:07,600 --> 00:02:10,639
Speaker 5: possibility just because again they raise a lot of outside money.

42
00:02:10,680 --> 00:02:12,840
Speaker 5: We don't know, I don't believe anyway that what this

43
00:02:12,880 --> 00:02:14,520
Speaker 5: money would be for, whether it would be to buy

44
00:02:14,560 --> 00:02:18,000
Speaker 5: out some existing shareholders you know he took he did

45
00:02:18,040 --> 00:02:20,520
Speaker 5: not pay for this the entire forty four billion himself,

46
00:02:20,800 --> 00:02:23,320
Speaker 5: or perhaps you know, they're trying to raise capital, although

47
00:02:23,639 --> 00:02:26,000
Speaker 5: my intuition would be at least some of this would

48
00:02:26,000 --> 00:02:28,200
Speaker 5: probably go to some existing shareholders.

49
00:02:28,480 --> 00:02:30,760
Speaker 4: I mean, it makes sense to me that he gets

50
00:02:30,800 --> 00:02:36,639
Speaker 4: a higher evaluation now I understand that because well, I mean,

51
00:02:36,720 --> 00:02:42,040
Speaker 4: Tesla is worth what half a trillion dollars or something,

52
00:02:42,440 --> 00:02:48,120
Speaker 4: and that's obviously not on the fundamentals of the car business. Sorry,

53
00:02:48,160 --> 00:02:50,919
Speaker 4: it's worth one point one trillion dollars right now.

54
00:02:51,200 --> 00:02:53,880
Speaker 3: So investors are going to want this to get a

55
00:02:53,919 --> 00:02:55,919
Speaker 3: piece of x Ai.

56
00:02:56,160 --> 00:02:59,919
Speaker 4: For example, right Twitter owns I think a big stay

57
00:03:00,160 --> 00:03:05,040
Speaker 4: in Xai, or maybe some kind of robotics that he's

58
00:03:05,040 --> 00:03:07,120
Speaker 4: going to make, or I don't know.

59
00:03:07,480 --> 00:03:09,440
Speaker 3: So some other business that he's in.

60
00:03:09,680 --> 00:03:13,639
Speaker 5: So we so we know that some Twitter shareholders have

61
00:03:13,840 --> 00:03:16,880
Speaker 5: or that there is some ownership stake in Xai that

62
00:03:16,960 --> 00:03:19,680
Speaker 5: at least earlier shareholders are able to take advantage of.

63
00:03:19,760 --> 00:03:21,280
Speaker 3: I'm not sure that these investors.

64
00:03:21,280 --> 00:03:22,960
Speaker 5: I don't know if what, I don't know exactly what

65
00:03:23,000 --> 00:03:25,600
Speaker 5: they're buying here or whether or how much of how

66
00:03:25,680 --> 00:03:28,200
Speaker 5: much of Xai they would be getting. But you're right

67
00:03:28,480 --> 00:03:31,680
Speaker 5: that Xai, which is Elon Musk's AI thing, is this

68
00:03:32,680 --> 00:03:36,120
Speaker 5: fast growing chatbot competitor to chat gbt.

69
00:03:36,720 --> 00:03:36,920
Speaker 3: Uh.

70
00:03:36,960 --> 00:03:39,120
Speaker 5: You know, obviously a lot of people think there's upside there,

71
00:03:39,320 --> 00:03:42,040
Speaker 5: and it's using Twitter's data, and Twitter one way or

72
00:03:42,080 --> 00:03:44,160
Speaker 5: another is going to and Twitter shareholders, one way or

73
00:03:44,200 --> 00:03:46,440
Speaker 5: another are going to get compensated for that, whether that's

74
00:03:46,560 --> 00:03:50,280
Speaker 5: coming in revenue or ownership stake one way or another. Xai,

75
00:03:50,480 --> 00:03:52,680
Speaker 5: this other venture is going to pay for that, and

76
00:03:52,720 --> 00:03:54,880
Speaker 5: that's helping to drive the value. The other thing that's

77
00:03:54,920 --> 00:03:57,560
Speaker 5: helping to drive the value is just the fact that

78
00:03:57,600 --> 00:03:59,440
Speaker 5: Twitter x feels more.

79
00:03:59,360 --> 00:04:01,360
Speaker 3: Vital than it did, say a year ago.

80
00:04:01,680 --> 00:04:05,040
Speaker 5: And that I think, like some of what investors, if

81
00:04:05,040 --> 00:04:08,720
Speaker 5: they're buying at forty four billion or higher, are reacting to,

82
00:04:09,120 --> 00:04:12,520
Speaker 5: is the prospect that Trump could perhaps make policies that

83
00:04:12,560 --> 00:04:17,279
Speaker 5: would somehow be helpful to x the company. But they're

84
00:04:17,320 --> 00:04:19,320
Speaker 5: also just reacting to the fact that, like this is

85
00:04:19,400 --> 00:04:23,039
Speaker 5: basically the center of conservative media right now. This is

86
00:04:23,120 --> 00:04:26,320
Speaker 5: kind of where anyone on the right, especially anyone on

87
00:04:26,360 --> 00:04:29,479
Speaker 5: the kind of Trump aligned right, is making news, is

88
00:04:29,560 --> 00:04:31,760
Speaker 5: releasing stuff. It's where a lot of the big media

89
00:04:31,800 --> 00:04:33,960
Speaker 5: figures are spending a lot of their time. It's basically

90
00:04:34,000 --> 00:04:38,640
Speaker 5: like what Twitter was for everyone, you know, maybe maybe

91
00:04:38,640 --> 00:04:41,640
Speaker 5: like ten years ago, and in certain ways Twitter had

92
00:04:41,680 --> 00:04:43,920
Speaker 5: kind of lost that and Elon Musk has brought that back,

93
00:04:44,040 --> 00:04:47,719
Speaker 5: at least in this one corner of the political world,

94
00:04:47,760 --> 00:04:50,040
Speaker 5: which happens to be the corner affiliated with the president.

95
00:04:50,040 --> 00:04:52,479
Speaker 4: By the way, say a side question on that note,

96
00:04:53,080 --> 00:04:56,839
Speaker 4: do all journalists, even the bleeding heart liberals, which is

97
00:04:56,960 --> 00:04:59,040
Speaker 4: to say all journalists still use Twitter?

98
00:04:59,680 --> 00:05:03,039
Speaker 5: You know, Twitter has i'd say, proven very sticky, even

99
00:05:03,200 --> 00:05:05,680
Speaker 5: for people on on the left. You see people a

100
00:05:05,720 --> 00:05:08,400
Speaker 5: lot of people have gone over to Blue Sky, a

101
00:05:08,440 --> 00:05:10,600
Speaker 5: lot of liberals have gone over to Blue Sky, or

102
00:05:10,640 --> 00:05:14,560
Speaker 5: threads are still posting on Twitter that said they. Twitter

103
00:05:14,600 --> 00:05:19,440
Speaker 5: has definitely lost a bunch of celebrities. I think you're

104
00:05:19,480 --> 00:05:24,680
Speaker 5: seeing media outlets, even companies maybe not participating quite as

105
00:05:24,760 --> 00:05:27,360
Speaker 5: much on Twitter now. I don't think that has everything

106
00:05:27,400 --> 00:05:29,239
Speaker 5: to do with politics. A lot of that was happening

107
00:05:29,279 --> 00:05:34,480
Speaker 5: like before the acquisition. Basically, social media in general is

108
00:05:34,560 --> 00:05:37,760
Speaker 5: no law, is not proving to be as big a

109
00:05:37,800 --> 00:05:40,440
Speaker 5: traffic driver companies are just not wanting to invest in

110
00:05:40,480 --> 00:05:42,239
Speaker 5: it as much, and that was one of the reasons.

111
00:05:42,279 --> 00:05:45,000
Speaker 5: Remember back two years ago when Elon Musk bought the company,

112
00:05:45,040 --> 00:05:47,880
Speaker 5: he agreed to this price forty four billion, and then

113
00:05:47,880 --> 00:05:49,320
Speaker 5: he tried to get out of it. The price kind

114
00:05:49,320 --> 00:05:52,839
Speaker 5: of fell, and there was this broader sense that all

115
00:05:52,839 --> 00:05:55,560
Speaker 5: of these social media companies were just not as valuable

116
00:05:55,760 --> 00:05:58,279
Speaker 5: as as they had been, say in the kind of

117
00:05:58,320 --> 00:06:01,320
Speaker 5: immediate aftermath of pandemic, when all of us just you know,

118
00:06:01,360 --> 00:06:02,040
Speaker 5: had a lot more.

119
00:06:01,920 --> 00:06:04,000
Speaker 3: Time on our hands, perhaps to scroll so like.

120
00:06:04,120 --> 00:06:05,960
Speaker 5: So some of those trends have nothing to do with politics,

121
00:06:05,960 --> 00:06:08,240
Speaker 5: but of course politics has everything to do with.

122
00:06:08,200 --> 00:06:10,320
Speaker 2: This interesting all right, we'll keep on top of that.

123
00:06:10,560 --> 00:06:13,760
Speaker 2: Max Chafkin Bloomberg BusinessWeek's senior reporter and he's co host

124
00:06:13,839 --> 00:06:14,960
Speaker 2: of the Elon Inc.

125
00:06:15,560 --> 00:06:16,080
Speaker 3: Podcast.

126
00:06:17,839 --> 00:06:21,520
Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

127
00:06:21,600 --> 00:06:25,000
Speaker 1: weekdays at ten am Eastern on Applecarplay and Android Auto

128
00:06:25,120 --> 00:06:28,159
Speaker 1: with the Bloomberg Business app. Listen on demand wherever you

129
00:06:28,200 --> 00:06:31,600
Speaker 1: get your podcasts, or watch us live on YouTube.

130
00:06:31,279 --> 00:06:34,240
Speaker 2: The news out of our friends from Cooper Tino. Apple

131
00:06:34,760 --> 00:06:39,040
Speaker 2: says that it will have a more affordable iPhone sixteen

132
00:06:39,080 --> 00:06:40,599
Speaker 2: E available February twenty eighth.

133
00:06:40,600 --> 00:06:41,000
Speaker 6: This could be.

134
00:06:40,960 --> 00:06:44,200
Speaker 2: Important for us in the s E the SSE sixteen

135
00:06:44,360 --> 00:06:48,000
Speaker 2: s E sixteen SC, thank you sixteen SC. I'm thinking

136
00:06:48,000 --> 00:06:50,320
Speaker 2: of markets like you know, some developing markets because they

137
00:06:50,400 --> 00:06:52,400
Speaker 2: needed a lower price iPhone well.

138
00:06:52,320 --> 00:06:54,560
Speaker 4: Or even here for people who don't need to do

139
00:06:54,680 --> 00:06:55,560
Speaker 4: much more than.

140
00:06:56,120 --> 00:06:57,680
Speaker 3: Text and call.

141
00:06:57,800 --> 00:07:00,680
Speaker 4: Who's that I mean looking at me? Well, I mean

142
00:07:01,040 --> 00:07:04,159
Speaker 4: you and me? Right, what are we doing besides scrolling?

143
00:07:04,240 --> 00:07:06,479
Speaker 4: You know, you've got your doom scrolling on your TikTok

144
00:07:06,560 --> 00:07:09,840
Speaker 4: or whatever you're doing over there, and then you're texting

145
00:07:09,880 --> 00:07:13,560
Speaker 4: and making calls. I'm not doing graphic design with my phone.

146
00:07:13,880 --> 00:07:15,600
Speaker 3: All right, I'll tell anaag Rana.

147
00:07:15,640 --> 00:07:18,280
Speaker 2: He covers all that technology space for Bloomberg Intelligence, He

148
00:07:18,360 --> 00:07:18,800
Speaker 2: joins us.

149
00:07:18,800 --> 00:07:21,680
Speaker 3: Here our talk just about Apple here? What is this

150
00:07:21,800 --> 00:07:23,560
Speaker 3: new product? What are they trying to target here?

151
00:07:24,600 --> 00:07:27,400
Speaker 6: Yeah, it's actually given a bigger screen size for a

152
00:07:27,440 --> 00:07:30,720
Speaker 6: smaller price. So they've taken the S out of the

153
00:07:30,880 --> 00:07:34,320
Speaker 6: SE and call it the iPhone sixteen EH, which is

154
00:07:34,480 --> 00:07:40,640
Speaker 6: essentially the big Zoom, big screen, Foster chip, Apple Intelligence,

155
00:07:41,720 --> 00:07:44,560
Speaker 6: much bigger battery life for two hundred dollars less. I

156
00:07:44,600 --> 00:07:47,840
Speaker 6: think that's really The punchline from my side is that

157
00:07:47,880 --> 00:07:50,000
Speaker 6: it's two hundred dollars lower than the base model of

158
00:07:50,000 --> 00:07:53,760
Speaker 6: iPhone sixteen, which actually should help them compete better in

159
00:07:53,880 --> 00:07:55,120
Speaker 6: China where they're struggling.

160
00:07:55,880 --> 00:07:59,680
Speaker 4: So what won't this phone be able to do? I mean,

161
00:08:00,080 --> 00:08:04,600
Speaker 4: all gets it. Is he going to feel like he's

162
00:08:04,640 --> 00:08:08,600
Speaker 4: not able to achieve as much in his daily life

163
00:08:09,080 --> 00:08:11,680
Speaker 4: as he would if he got the pro model or

164
00:08:11,840 --> 00:08:13,960
Speaker 4: will he just not notice.

165
00:08:14,120 --> 00:08:16,320
Speaker 6: A pro model will have a much more phenomenal camera.

166
00:08:16,400 --> 00:08:18,440
Speaker 6: So if you're really into photography, you're not going to

167
00:08:18,480 --> 00:08:19,960
Speaker 6: go for this model. You're going to go for the

168
00:08:20,000 --> 00:08:22,280
Speaker 6: pro model. But if you really want to get into

169
00:08:22,280 --> 00:08:25,720
Speaker 6: the Apple ecosystem and be part of the Apple family,

170
00:08:25,760 --> 00:08:28,000
Speaker 6: which I think a lot of people in emerging markets

171
00:08:28,040 --> 00:08:31,320
Speaker 6: want to be, but the higher price point stops them

172
00:08:31,320 --> 00:08:33,640
Speaker 6: from getting there, this is a nice way to get there.

173
00:08:33,960 --> 00:08:36,800
Speaker 6: The other thing is the upgrades from eleven to twelve.

174
00:08:37,120 --> 00:08:39,640
Speaker 6: They actually put down a little tab on their release

175
00:08:39,880 --> 00:08:43,520
Speaker 6: which shows the battery life of this phone substantially better

176
00:08:43,920 --> 00:08:46,320
Speaker 6: than the eleven and the twelve and the se So

177
00:08:46,520 --> 00:08:49,040
Speaker 6: for all of those people who actually been hanging around

178
00:08:49,080 --> 00:08:51,440
Speaker 6: with their twelve and elevens, and this is a good

179
00:08:51,480 --> 00:08:53,720
Speaker 6: way to upgrade without paying a lot more.

180
00:08:54,520 --> 00:08:57,040
Speaker 2: I got the sixteen Pro, I upgraded from the eleven

181
00:08:57,280 --> 00:09:00,280
Speaker 2: and it is the battery life is awesome, so much less.

182
00:09:00,080 --> 00:09:00,880
Speaker 3: Stress in your life.

183
00:09:00,920 --> 00:09:02,880
Speaker 2: You don't have to worry about the battery and carrying around.

184
00:09:02,679 --> 00:09:05,640
Speaker 3: A charger and those pictures that you're taking, Paul all phenomenal.

185
00:09:05,720 --> 00:09:08,760
Speaker 2: Yeah, here's my picture taking rule. If there isn't a

186
00:09:08,800 --> 00:09:11,200
Speaker 2: person in the picture, I'm not taking it. Yeah, you know,

187
00:09:11,320 --> 00:09:13,640
Speaker 2: like I was skiing, not one picture of me of

188
00:09:13,679 --> 00:09:14,520
Speaker 2: the like the mount Dude.

189
00:09:14,559 --> 00:09:17,360
Speaker 4: I just went uh scuba diving for two weeks in Indonesia,

190
00:09:17,440 --> 00:09:19,080
Speaker 4: and for the first time I said, you know what,

191
00:09:19,320 --> 00:09:19,679
Speaker 4: screw it.

192
00:09:19,720 --> 00:09:21,640
Speaker 3: I'm not taking any pictures at the moment. I'm not

193
00:09:21,640 --> 00:09:22,360
Speaker 3: bringing a go pro.

194
00:09:22,720 --> 00:09:25,480
Speaker 4: I'm just gonna look yes stuff and see it with

195
00:09:25,600 --> 00:09:27,079
Speaker 4: my eyes on rag.

196
00:09:27,160 --> 00:09:28,720
Speaker 2: It's just going to be enough for Apple because I

197
00:09:28,720 --> 00:09:31,480
Speaker 2: think about with some of the challenges in China, boy,

198
00:09:31,520 --> 00:09:35,200
Speaker 2: they have to really look even maybe more intently at India.

199
00:09:35,240 --> 00:09:36,840
Speaker 2: And if you're gonna be a player in India, I

200
00:09:36,920 --> 00:09:39,520
Speaker 2: kind of feel like you need even a lower.

201
00:09:39,200 --> 00:09:42,080
Speaker 3: Price price phone. What is their India strategy now?

202
00:09:43,240 --> 00:09:44,600
Speaker 6: Oh, I think you know one of the things that

203
00:09:44,640 --> 00:09:47,200
Speaker 6: has happened over the last seventy eight years is inflation

204
00:09:47,320 --> 00:09:49,600
Speaker 6: is really kicked in and these phones that started with

205
00:09:49,960 --> 00:09:52,120
Speaker 6: five hundred and six hundred and now priced at eleven

206
00:09:52,160 --> 00:09:55,080
Speaker 6: hundred eleven hundred. So I mean there is a bunch

207
00:09:55,160 --> 00:09:57,319
Speaker 6: of you could say, esp going up for these phones.

208
00:09:57,600 --> 00:09:59,920
Speaker 6: This is Apples way of saying, Okay, I cannot dent

209
00:10:00,080 --> 00:10:02,679
Speaker 6: these markets which just features alone, let me bring a

210
00:10:02,720 --> 00:10:05,080
Speaker 6: little bit of you know, price flavor in it. The

211
00:10:05,160 --> 00:10:07,960
Speaker 6: thing that's impressive in this case is they've actually increased

212
00:10:07,960 --> 00:10:10,840
Speaker 6: the size of the screen along with high battery life.

213
00:10:10,840 --> 00:10:13,800
Speaker 6: For some people, that's enough. Frankly, I think when you

214
00:10:13,840 --> 00:10:16,800
Speaker 6: are targeting the Indian market and the Chinese market, you're right,

215
00:10:16,960 --> 00:10:19,000
Speaker 6: it's probably you know, one hundred dollars less would have

216
00:10:19,040 --> 00:10:22,480
Speaker 6: been better. But remember a lot of those people start

217
00:10:22,559 --> 00:10:26,559
Speaker 6: with a refurbished phone from Apple and then they want

218
00:10:26,600 --> 00:10:28,760
Speaker 6: to move up. This is I think a nice bridge

219
00:10:28,760 --> 00:10:32,000
Speaker 6: between those things and the pro models, and I think

220
00:10:32,040 --> 00:10:33,559
Speaker 6: it'll work both in India and China.

221
00:10:33,600 --> 00:10:39,400
Speaker 4: Also, you know, I've been having long, drawn out deep

222
00:10:39,600 --> 00:10:44,400
Speaker 4: conversations with chat GPT in my car. No, you're all in, yeah, well,

223
00:10:44,440 --> 00:10:47,600
Speaker 4: it has a voice you know function now, So you've

224
00:10:47,600 --> 00:10:51,520
Speaker 4: got a friend now exactly. I asked questions, you know,

225
00:10:51,960 --> 00:10:54,640
Speaker 4: usually about cars, and we go through a lot of

226
00:10:54,679 --> 00:10:59,520
Speaker 4: stuff together, and it's fascinating and helpful to me. But

227
00:10:59,600 --> 00:11:04,280
Speaker 4: one thing it can't do is work in my iOS.

228
00:11:04,360 --> 00:11:07,040
Speaker 4: It can't make appointments for me, send an email, send

229
00:11:07,120 --> 00:11:09,920
Speaker 4: a message, that sort of thing. Obviously Siri can do

230
00:11:10,559 --> 00:11:15,199
Speaker 4: some of that stuff, but isn't nearly as capable or intelligent.

231
00:11:15,280 --> 00:11:17,199
Speaker 3: I guess if that's word I can use as chat GPT.

232
00:11:18,000 --> 00:11:20,720
Speaker 4: When are they going to step up their game in

233
00:11:20,800 --> 00:11:21,480
Speaker 4: terms of Siri.

234
00:11:22,840 --> 00:11:25,000
Speaker 6: One of the things you have to remember, Mark, when

235
00:11:25,040 --> 00:11:27,800
Speaker 6: you come to Apple, they are extremely worried about privacy

236
00:11:27,800 --> 00:11:30,920
Speaker 6: and the data leaking. So I am fairly certain over

237
00:11:30,920 --> 00:11:33,280
Speaker 6: the next twelve months you will see them using more

238
00:11:33,360 --> 00:11:35,560
Speaker 6: large language models to do a lot of those things.

239
00:11:35,920 --> 00:11:37,760
Speaker 6: But they just have to go with their own pace

240
00:11:37,840 --> 00:11:40,440
Speaker 6: because one of the things they cannot do is dialute

241
00:11:40,440 --> 00:11:43,400
Speaker 6: their brand because of some error by some other third

242
00:11:43,440 --> 00:11:46,400
Speaker 6: party provider. And I mean it's just a matter of

243
00:11:46,440 --> 00:11:50,000
Speaker 6: something coming a little bit later, you know, I'm to

244
00:11:50,040 --> 00:11:52,959
Speaker 6: be honest, not that concerned. My biggest thing is whether

245
00:11:53,120 --> 00:11:56,400
Speaker 6: this thing can push towards that unit shipment problems that

246
00:11:56,440 --> 00:11:58,520
Speaker 6: Apple's been facing for the past three years.

247
00:11:59,000 --> 00:12:00,840
Speaker 2: An Rock, thanks so much for running us on Rogron

248
00:12:00,920 --> 00:12:03,520
Speaker 2: of technology channels for Bloomberg Intelligence, joining us from that

249
00:12:03,920 --> 00:12:06,280
Speaker 2: burgeoning tech cub that is known as Chicago, Illinois.

250
00:12:07,960 --> 00:12:11,679
Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

251
00:12:11,760 --> 00:12:15,120
Speaker 1: weekdays at ten am Eastern on Applecarplay and Android Auto

252
00:12:15,240 --> 00:12:18,320
Speaker 1: with the Bloomberg Business App. Listen on demand wherever you

253
00:12:18,360 --> 00:12:21,760
Speaker 1: get your podcasts, or watch us live on YouTube.

254
00:12:22,559 --> 00:12:24,880
Speaker 2: Alex Steel is out today, Paul Sweeney with you live

255
00:12:24,880 --> 00:12:27,280
Speaker 2: here in our Bloomberg INTERACTI Broker Studio. We're streaming live

256
00:12:27,320 --> 00:12:29,440
Speaker 2: on YouTube as well, so you can see us. Go

257
00:12:29,480 --> 00:12:31,600
Speaker 2: to Bloomberg, go to YouTube.

258
00:12:31,840 --> 00:12:32,360
Speaker 3: Where did they go?

259
00:12:32,520 --> 00:12:34,640
Speaker 2: They go to YouTube dot com and they search Bloomberg

260
00:12:34,800 --> 00:12:36,760
Speaker 2: Podcast Live, and that's how it.

261
00:12:36,720 --> 00:12:37,360
Speaker 3: All works, all right.

262
00:12:37,360 --> 00:12:39,160
Speaker 2: We're hearing a lot of news coming out of Washington, DC,

263
00:12:39,280 --> 00:12:43,000
Speaker 2: out of the Doge Group, Elon Musk Group. They're looking

264
00:12:43,000 --> 00:12:45,640
Speaker 2: for efficiencies. One of the areas that they are finding

265
00:12:45,840 --> 00:12:48,240
Speaker 2: is I think there's too many people in the US government.

266
00:12:48,240 --> 00:12:49,880
Speaker 2: We've heard that for a long time, but they're making

267
00:12:49,920 --> 00:12:53,559
Speaker 2: some big moves laying people off, firing people.

268
00:12:53,280 --> 00:12:53,920
Speaker 3: Across the board.

269
00:12:53,960 --> 00:12:55,160
Speaker 2: We want to get a sense of kind of what

270
00:12:55,200 --> 00:13:01,080
Speaker 2: that means for the government workforce. Jessica Krugel, chief strategy

271
00:13:01,080 --> 00:13:05,000
Speaker 2: officer for Culture Partners, Jessica, I, I've seen the numbers.

272
00:13:05,760 --> 00:13:07,720
Speaker 3: We've all seen the numbers in the reporting, but I

273
00:13:07,720 --> 00:13:08,319
Speaker 3: haven't seen.

274
00:13:08,120 --> 00:13:11,000
Speaker 2: The stories of the people how it's affecting them, what's

275
00:13:11,000 --> 00:13:14,320
Speaker 2: happening to them. Because it's odd because it used to

276
00:13:14,320 --> 00:13:16,120
Speaker 2: be if you've worked for the government, maybe it'll make

277
00:13:16,120 --> 00:13:17,960
Speaker 2: a lot of money, but you certainly have job security.

278
00:13:18,160 --> 00:13:19,280
Speaker 3: That's not the case anymore.

279
00:13:19,480 --> 00:13:21,800
Speaker 7: No job security is gone. I mean that was the

280
00:13:21,880 --> 00:13:23,559
Speaker 7: choice that we made as young people. Do we want

281
00:13:23,559 --> 00:13:25,760
Speaker 7: to go into private industry and we'll make more money

282
00:13:25,840 --> 00:13:27,640
Speaker 7: but be more at risk, or do we want to

283
00:13:27,679 --> 00:13:30,559
Speaker 7: work for the government and have that job security. Because

284
00:13:30,600 --> 00:13:33,120
Speaker 7: that's gone now. The only option left for the American

285
00:13:33,160 --> 00:13:36,000
Speaker 7: people if they want job security is to upskill. They

286
00:13:36,000 --> 00:13:38,920
Speaker 7: have to be better, they have to become top performers

287
00:13:38,960 --> 00:13:42,040
Speaker 7: in order to claim that job security for themselves. So

288
00:13:42,040 --> 00:13:43,720
Speaker 7: it's really about taking accountability.

289
00:13:44,160 --> 00:13:44,880
Speaker 4: And it's sad.

290
00:13:44,960 --> 00:13:47,199
Speaker 7: It's sad for the people who are losing their jobs

291
00:13:47,240 --> 00:13:49,560
Speaker 7: because if those jobs were never needed and if they

292
00:13:49,559 --> 00:13:53,080
Speaker 7: are wasteful, as the right are saying, well, it wasn't

293
00:13:53,120 --> 00:13:56,040
Speaker 7: their fault that they had those jobs, obviously, but now

294
00:13:56,080 --> 00:13:57,040
Speaker 7: they have to pay the price.

295
00:13:57,360 --> 00:13:59,920
Speaker 2: So I mean, again, I don't think a lot of

296
00:14:00,040 --> 00:14:03,160
Speaker 2: people would argue that our government is not loaded, to

297
00:14:03,240 --> 00:14:06,520
Speaker 2: use a term, and whether that's just overall costs overhead,

298
00:14:06,800 --> 00:14:10,000
Speaker 2: whether it's people that there can't be a lot more

299
00:14:10,040 --> 00:14:13,360
Speaker 2: efficiencies probably coming out of government, both federal government local,

300
00:14:14,400 --> 00:14:16,200
Speaker 2: But the reality is a lot of times that means

301
00:14:16,440 --> 00:14:21,400
Speaker 2: people in jobs. So again, the message for these folks,

302
00:14:21,600 --> 00:14:23,680
Speaker 2: if they're to the extent they're being impacted out of

303
00:14:23,720 --> 00:14:25,800
Speaker 2: a job, is they need to up their gain, don't

304
00:14:25,840 --> 00:14:26,400
Speaker 2: they They.

305
00:14:26,280 --> 00:14:28,480
Speaker 7: Do need to up there that same well we've heard we've.

306
00:14:28,280 --> 00:14:31,600
Speaker 2: Heard that before when manufacturing jobs we're leaving this country

307
00:14:31,600 --> 00:14:34,000
Speaker 2: over the last thirty forty fifty years, that those workers

308
00:14:34,040 --> 00:14:36,120
Speaker 2: will need to find new skills for this new economy.

309
00:14:36,320 --> 00:14:37,560
Speaker 3: It's kind of a similar story.

310
00:14:37,640 --> 00:14:39,480
Speaker 7: It's a story as old as time. We have to

311
00:14:39,560 --> 00:14:44,400
Speaker 7: evolve as industry evolves. The issue here is I don't

312
00:14:44,440 --> 00:14:47,840
Speaker 7: think actually that a lot of Democrats are necessarily angry

313
00:14:47,880 --> 00:14:50,040
Speaker 7: with some of the decisions that are being made because

314
00:14:50,120 --> 00:14:52,040
Speaker 7: there probably is a lot of bloat. There probably is

315
00:14:52,080 --> 00:14:55,480
Speaker 7: an efficiency no one wants incompetence, No one wants that waste.

316
00:14:55,840 --> 00:14:58,800
Speaker 7: The issue is the haste with which this is happening.

317
00:14:59,080 --> 00:15:02,080
Speaker 7: I think there could be more thoughtfulness perhaps and how

318
00:15:02,160 --> 00:15:05,080
Speaker 7: quickly we move because these people are getting affected and

319
00:15:05,120 --> 00:15:07,680
Speaker 7: we're going to see that it's going to be a

320
00:15:07,720 --> 00:15:10,240
Speaker 7: big story with unemployment numbers as we see in the

321
00:15:10,240 --> 00:15:11,160
Speaker 7: next few job reports.

322
00:15:11,200 --> 00:15:12,360
Speaker 3: I'm sure, yeah, exactly.

323
00:15:12,520 --> 00:15:15,520
Speaker 2: Do we know what kind of severance plans they're getting

324
00:15:15,560 --> 00:15:18,880
Speaker 2: or anything like that. I haven't heard much about that either.

325
00:15:19,120 --> 00:15:21,360
Speaker 7: No. Well, we saw that there was the fork option

326
00:15:21,480 --> 00:15:23,880
Speaker 7: that seventy five thousand workers took. That was about four

327
00:15:23,920 --> 00:15:25,800
Speaker 7: percent of the US government. Some of the people who

328
00:15:25,840 --> 00:15:28,960
Speaker 7: took that severance option then also got fired, and so

329
00:15:29,000 --> 00:15:32,000
Speaker 7: there's been some administrative issues with how all of this

330
00:15:32,040 --> 00:15:34,600
Speaker 7: is rolling out. Back to the haste issue, it's been

331
00:15:34,680 --> 00:15:36,800
Speaker 7: a little bit messy. You see people being laid off

332
00:15:36,800 --> 00:15:39,280
Speaker 7: and then being called back later that weekend when they realize,

333
00:15:39,320 --> 00:15:41,160
Speaker 7: for example, the laid off people who were working on

334
00:15:41,200 --> 00:15:44,000
Speaker 7: the bird flu they said no, wait, come back, the

335
00:15:44,120 --> 00:15:47,920
Speaker 7: nuclear story, for example. So there's lots of chaos and

336
00:15:47,960 --> 00:15:49,320
Speaker 7: this needs to be ironed out.

337
00:15:49,960 --> 00:15:54,120
Speaker 2: Are you surprised that it's that it's I guess, DOGE

338
00:15:54,160 --> 00:15:56,040
Speaker 2: being led by Elon Musk seems to be at the

339
00:15:56,040 --> 00:15:58,480
Speaker 2: forefront of making these decisions.

340
00:15:58,600 --> 00:16:01,400
Speaker 3: Is that is that working? Well? Do we know?

341
00:16:01,640 --> 00:16:03,680
Speaker 7: Seems to be right, But then I also saw that

342
00:16:03,720 --> 00:16:07,160
Speaker 7: now they're claiming that Elon Musk is not making these decisions,

343
00:16:07,200 --> 00:16:10,000
Speaker 7: and so really a lot of the confusion is in

344
00:16:10,040 --> 00:16:13,000
Speaker 7: the massive amount of communications and headlines that are happening

345
00:16:13,040 --> 00:16:14,520
Speaker 7: all at once. Everyone is trying.

346
00:16:14,280 --> 00:16:14,840
Speaker 1: To keep up.

347
00:16:15,520 --> 00:16:17,320
Speaker 2: I mean, I guess again, when you think about it,

348
00:16:17,400 --> 00:16:19,520
Speaker 2: whether it's in the government or in the corporate world,

349
00:16:20,280 --> 00:16:23,360
Speaker 2: everybody's got to kind of adapt to this changing environment.

350
00:16:24,800 --> 00:16:26,840
Speaker 2: Is that similar for the US government?

351
00:16:26,840 --> 00:16:27,280
Speaker 3: Do you think?

352
00:16:27,560 --> 00:16:27,760
Speaker 4: Well?

353
00:16:27,760 --> 00:16:30,960
Speaker 7: I think companies are going to be looking at how

354
00:16:31,000 --> 00:16:33,640
Speaker 7: these decisions within the federal government will affect them. With

355
00:16:33,680 --> 00:16:37,160
Speaker 7: the FAHA announcement, for example, mortgage companies will be impacted

356
00:16:37,520 --> 00:16:39,880
Speaker 7: if they're not able to get mortgage insurance for low

357
00:16:39,920 --> 00:16:42,680
Speaker 7: income mortgage families that are interested in their first time home,

358
00:16:42,800 --> 00:16:45,160
Speaker 7: then they're either going to increase their rates or they're

359
00:16:45,200 --> 00:16:47,480
Speaker 7: going to give out less mortgages. How does that impact

360
00:16:47,680 --> 00:16:51,120
Speaker 7: people in corporations? It will have a ripple effect this

361
00:16:51,200 --> 00:16:54,840
Speaker 7: economy is a holistic system, and so one change in

362
00:16:54,880 --> 00:16:57,040
Speaker 7: the federal government will ripple out.

363
00:16:57,840 --> 00:17:00,360
Speaker 2: So what's the expectation here going forward? Is it something

364
00:17:00,400 --> 00:17:02,120
Speaker 2: I mean, one could argue again if you think about

365
00:17:02,160 --> 00:17:05,520
Speaker 2: the US government, it feels like it's something that is

366
00:17:05,720 --> 00:17:08,320
Speaker 2: ripe for efficiency or greater efficiency.

367
00:17:08,800 --> 00:17:10,240
Speaker 3: This could be a long term process.

368
00:17:10,560 --> 00:17:12,560
Speaker 7: Oh yeah, this is going to take a long time.

369
00:17:12,600 --> 00:17:15,560
Speaker 7: I don't think we're going to really understand the impact

370
00:17:15,600 --> 00:17:18,800
Speaker 7: that this will have on our economy for six to

371
00:17:18,880 --> 00:17:22,840
Speaker 7: nine months. Right now, we are in the hardest part

372
00:17:22,920 --> 00:17:26,280
Speaker 7: of change management. We say it culture partners. Culture doesn't

373
00:17:26,280 --> 00:17:28,520
Speaker 7: go down without a fight, and so right now there's

374
00:17:28,640 --> 00:17:32,560
Speaker 7: massive resistance because it is different. Whether this different is

375
00:17:32,600 --> 00:17:35,680
Speaker 7: going to be better and more efficient and more economical,

376
00:17:36,000 --> 00:17:37,240
Speaker 7: we'll have to wait and see.

377
00:17:37,600 --> 00:17:41,560
Speaker 2: So what are the next steps for people that I

378
00:17:41,560 --> 00:17:44,720
Speaker 2: mean when you're in a government role, you know, that's

379
00:17:44,760 --> 00:17:48,520
Speaker 2: a whole different idea and in mindset to being in

380
00:17:48,600 --> 00:17:52,200
Speaker 2: the corporate world, the for profit world, how difficult do

381
00:17:52,200 --> 00:17:55,280
Speaker 2: you think it will be for these people to adapt

382
00:17:55,320 --> 00:17:58,359
Speaker 2: and maybe reskill or upskill or kind of look outside

383
00:17:58,359 --> 00:18:02,000
Speaker 2: of the government, which again was seen as almost employment

384
00:18:02,040 --> 00:18:02,440
Speaker 2: for life.

385
00:18:02,560 --> 00:18:04,880
Speaker 7: Yeah, it's interesting because you've seen a lot of headlines

386
00:18:04,920 --> 00:18:08,920
Speaker 7: recently about generations Z gravitating towards government work because they

387
00:18:08,920 --> 00:18:12,840
Speaker 7: want the stability that they felt they couldn't get with corporations.

388
00:18:13,080 --> 00:18:15,720
Speaker 7: That's now out the window, obviously, and so young people

389
00:18:15,760 --> 00:18:18,159
Speaker 7: they're gonna have to do what everyone has done in

390
00:18:18,200 --> 00:18:21,960
Speaker 7: the history of building their careers, which is upskill, upskill, upskill.

391
00:18:22,200 --> 00:18:24,280
Speaker 7: I want to learn everything about AI right now. I

392
00:18:24,320 --> 00:18:28,240
Speaker 7: want to understand how I can take control of my

393
00:18:28,359 --> 00:18:31,000
Speaker 7: career by making the choice to focus on what I

394
00:18:31,040 --> 00:18:34,119
Speaker 7: can control to drive results in whatever it is that

395
00:18:34,200 --> 00:18:36,720
Speaker 7: I do. And if I can differentiate myself as a

396
00:18:36,760 --> 00:18:39,240
Speaker 7: top performer, then I'm going to have job security because

397
00:18:39,440 --> 00:18:41,640
Speaker 7: I will be in need. Right the people who are

398
00:18:41,640 --> 00:18:44,040
Speaker 7: probably not the top performers are the people who are

399
00:18:44,040 --> 00:18:46,320
Speaker 7: getting laid off and then getting called back three days later.

400
00:18:46,359 --> 00:18:49,680
Speaker 7: If you go back to that environment, you've already created

401
00:18:49,720 --> 00:18:52,400
Speaker 7: a dynamic in which people know, I mean, you're desperate.

402
00:18:52,520 --> 00:18:55,080
Speaker 7: So that's not necessarily a good move for you either.

403
00:18:55,200 --> 00:18:57,119
Speaker 2: Do you think corporate America will take a look what

404
00:18:57,160 --> 00:18:59,320
Speaker 2: the government's doing and saying, hey, maybe we should can

405
00:18:59,359 --> 00:18:59,880
Speaker 2: do this too.

406
00:19:00,080 --> 00:19:02,040
Speaker 7: I think the government is looking at what corporate America

407
00:19:02,080 --> 00:19:05,720
Speaker 7: has already done. The nature of layoffs has changed significantly

408
00:19:05,720 --> 00:19:07,320
Speaker 7: in the last ten years. It used to be a

409
00:19:07,400 --> 00:19:10,040
Speaker 7: last ditch effort to try and save a dying company.

410
00:19:10,280 --> 00:19:11,720
Speaker 7: Now it's an efficiency tool.

411
00:19:11,800 --> 00:19:11,960
Speaker 2: Right.

412
00:19:12,000 --> 00:19:15,720
Speaker 7: We're in the post COVID profit grabbing era, and so

413
00:19:16,040 --> 00:19:18,119
Speaker 7: a company will put their best quarter in history and

414
00:19:18,119 --> 00:19:20,639
Speaker 7: then have layoffs right afterwards, and the stock market reacts

415
00:19:20,680 --> 00:19:23,879
Speaker 7: very positively. So the government is taking note from Corporate

416
00:19:23,880 --> 00:19:25,280
Speaker 7: America and saying we can do that too.

417
00:19:25,560 --> 00:19:27,600
Speaker 3: Thirty seconds left. I learned of a new term during

418
00:19:27,640 --> 00:19:30,600
Speaker 3: the pandemic labor hoarding. Is that a thing courting?

419
00:19:30,720 --> 00:19:32,200
Speaker 7: Is it trying to attract labor?

420
00:19:32,400 --> 00:19:35,600
Speaker 3: Just people companies are holding on the employees. I'm not coarding.

421
00:19:35,720 --> 00:19:38,880
Speaker 7: Yeah, Oh I don't think that's the thing right now,

422
00:19:40,320 --> 00:19:41,359
Speaker 7: not anymore. Yeah.

423
00:19:41,359 --> 00:19:44,399
Speaker 2: Interesting, So see how the times change here. Jessica Krigle,

424
00:19:44,400 --> 00:19:46,320
Speaker 2: thank you so much for joining us. Jessica Kriggle is

425
00:19:46,320 --> 00:19:51,320
Speaker 2: the chief strategy officer for Culture Partners, based out there

426
00:19:51,320 --> 00:19:54,600
Speaker 2: in a Sacramento area.

427
00:19:54,800 --> 00:19:58,520
Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

428
00:19:58,600 --> 00:20:01,280
Speaker 1: weekdays at ten am Eastern on Apple clock Lay and

429
00:20:01,280 --> 00:20:04,560
Speaker 1: Android Otto with the Blueberg Business app. Listen on demand

430
00:20:04,600 --> 00:20:08,160
Speaker 1: wherever you get your podcasts, or watch us live on YouTube.

431
00:20:08,960 --> 00:20:11,560
Speaker 2: All right, twenty twenty three the smp I don't know,

432
00:20:11,560 --> 00:20:14,000
Speaker 2: twenty two to twenty three percent return heck of a year.

433
00:20:14,400 --> 00:20:17,040
Speaker 2: Did it again in twenty twenty four with north of

434
00:20:17,080 --> 00:20:19,119
Speaker 2: twenty percent returns for the S and P five hundred

435
00:20:19,160 --> 00:20:19,359
Speaker 2: and neck.

436
00:20:19,480 --> 00:20:21,119
Speaker 3: What do you do this year? Already up about three

437
00:20:21,160 --> 00:20:24,240
Speaker 3: and a half four percent? But can we do it again?

438
00:20:24,400 --> 00:20:28,560
Speaker 2: Marion Bartel's joins as a chief investment strategist at Sanctuary Wealth,

439
00:20:28,640 --> 00:20:31,520
Speaker 2: joining us from New York via zoom. So, Marian, when

440
00:20:31,560 --> 00:20:33,600
Speaker 2: you talk to your clients, you know, kind of when

441
00:20:33,600 --> 00:20:36,200
Speaker 2: you're doing your year a head letter for twenty twenty five,

442
00:20:36,400 --> 00:20:38,800
Speaker 2: how did you kind of set expectations? What are the

443
00:20:38,800 --> 00:20:40,960
Speaker 2: conversations you're having with your clients?

444
00:20:41,600 --> 00:20:45,119
Speaker 8: Well are your head report said? All that's new is old?

445
00:20:45,280 --> 00:20:50,679
Speaker 8: In other words, innovation has been around for centuries, and

446
00:20:50,760 --> 00:20:56,480
Speaker 8: we're just in another major phase of innovation with artificial intelligence,

447
00:20:57,240 --> 00:21:02,400
Speaker 8: with blockchain, with the crypto space also known as web three,

448
00:21:02,680 --> 00:21:07,159
Speaker 8: virtual reality. But you know, AI is really going to

449
00:21:07,200 --> 00:21:10,760
Speaker 8: increase productivity. We're already seeing enhancements in productivity, and we

450
00:21:10,800 --> 00:21:13,640
Speaker 8: think that's going to continue, So what does that mean

451
00:21:13,680 --> 00:21:16,600
Speaker 8: for earnings? That means earnings can continue to grow. And

452
00:21:17,119 --> 00:21:19,600
Speaker 8: you know, we're just getting to the end of fourth

453
00:21:19,680 --> 00:21:25,040
Speaker 8: quarter earnings for last year coming in significantly higher than expectations,

454
00:21:25,080 --> 00:21:28,760
Speaker 8: and we're seeing margins expand. And what we tell clients,

455
00:21:28,800 --> 00:21:31,360
Speaker 8: markets go up and down based on earnings, and we

456
00:21:31,440 --> 00:21:33,200
Speaker 8: have earnings.

457
00:21:33,160 --> 00:21:36,639
Speaker 2: So we it seems like Marian that that's going to

458
00:21:36,680 --> 00:21:38,359
Speaker 2: be key for this market because I'm not sure what

459
00:21:38,359 --> 00:21:40,639
Speaker 2: the Fed's going to do for us this year. Maybe

460
00:21:40,640 --> 00:21:43,640
Speaker 2: one cut, maybe two, but it seems like this market,

461
00:21:43,720 --> 00:21:46,240
Speaker 2: if it's going to move higher, really needs earnings. So

462
00:21:47,240 --> 00:21:49,639
Speaker 2: how confident are you in that earnings growth story for

463
00:21:49,680 --> 00:21:50,159
Speaker 2: this market?

464
00:21:50,960 --> 00:21:54,440
Speaker 8: Well, given the innovation that we have, I'm extremely confident,

465
00:21:54,520 --> 00:21:58,400
Speaker 8: so confident that I set our target range this year

466
00:21:58,400 --> 00:22:01,119
Speaker 8: to seventy two hundred to seventy four one hundred on

467
00:22:01,200 --> 00:22:03,480
Speaker 8: the S and P five hundred, which is another twenty

468
00:22:03,520 --> 00:22:05,879
Speaker 8: percent return, which is very rare.

469
00:22:07,040 --> 00:22:09,879
Speaker 2: So it's so is that going to have some margins,

470
00:22:09,920 --> 00:22:11,720
Speaker 2: have some multiple expansion Because I know a lot of

471
00:22:11,720 --> 00:22:15,320
Speaker 2: people are concerned about the valuation of this market.

472
00:22:15,320 --> 00:22:16,120
Speaker 3: How do you think about that?

473
00:22:17,280 --> 00:22:20,880
Speaker 8: So they're correct if I've gone back to nineteen hundred

474
00:22:21,359 --> 00:22:25,200
Speaker 8: on PE ratios for the S and P five hundred,

475
00:22:25,640 --> 00:22:28,240
Speaker 8: and we're at the top of the range. There's no

476
00:22:28,320 --> 00:22:33,440
Speaker 8: doubt about that. But when I study secular ball markets,

477
00:22:34,160 --> 00:22:38,080
Speaker 8: and particularly nineteen eighty two through the peak of two thousand,

478
00:22:38,800 --> 00:22:43,920
Speaker 8: we expanded PE multiples. So if my thesis is correct

479
00:22:44,240 --> 00:22:47,480
Speaker 8: that this innovation is going to continue to drive markets

480
00:22:47,520 --> 00:22:50,720
Speaker 8: actually out into the end of the decade, I actually

481
00:22:50,760 --> 00:22:54,520
Speaker 8: expect the PE multiples to continue to expand. I don't

482
00:22:54,560 --> 00:22:57,480
Speaker 8: think we're going to get a significant contraction. I think

483
00:22:57,520 --> 00:23:01,040
Speaker 8: the next time we see the market at well people

484
00:23:01,200 --> 00:23:04,840
Speaker 8: may call a reasonable multiple will not be INTI we

485
00:23:05,040 --> 00:23:07,760
Speaker 8: enter a secular bear market, which I don't think happens

486
00:23:07,840 --> 00:23:09,160
Speaker 8: until the next decade.

487
00:23:09,760 --> 00:23:11,879
Speaker 3: How about just maybe are there any risk coming out

488
00:23:11,920 --> 00:23:13,760
Speaker 3: of Washington d C. I think if you think about

489
00:23:13,760 --> 00:23:14,720
Speaker 3: this new Trump.

490
00:23:14,440 --> 00:23:16,600
Speaker 2: Administration, a lot of folks are very positive from an

491
00:23:16,640 --> 00:23:21,000
Speaker 2: economic perspective, lower taxes, maybe less regulation that could loosen

492
00:23:21,040 --> 00:23:23,880
Speaker 2: the animal spirits a little bit. But on the other side,

493
00:23:23,880 --> 00:23:28,560
Speaker 2: you've got all this talk about tariffs and other economic

494
00:23:28,600 --> 00:23:31,159
Speaker 2: policies that could be present a headwind. How do you

495
00:23:31,160 --> 00:23:33,040
Speaker 2: think about Washington risk?

496
00:23:34,480 --> 00:23:38,320
Speaker 8: So the market has really dealt very well with Washington

497
00:23:38,440 --> 00:23:42,119
Speaker 8: so far, and of course we have comments from Trump

498
00:23:42,200 --> 00:23:45,720
Speaker 8: again on tariffs, and I think that is not in

499
00:23:45,760 --> 00:23:48,480
Speaker 8: the markets. Yesterday we actually hit a new record high.

500
00:23:48,520 --> 00:23:50,399
Speaker 8: I think if we didn't have that comment, we'd be

501
00:23:50,440 --> 00:23:54,639
Speaker 8: sitting here at another new high in the market. So

502
00:23:54,680 --> 00:23:57,560
Speaker 8: I think the market needs time to digest what these

503
00:23:57,600 --> 00:24:01,720
Speaker 8: tariffs really mean. And they're not a done deal, so

504
00:24:02,000 --> 00:24:04,640
Speaker 8: the market doesn't like on certainty, and what they want

505
00:24:04,680 --> 00:24:07,040
Speaker 8: to know are the facts, and once they know the facts,

506
00:24:07,040 --> 00:24:09,200
Speaker 8: they'll price it in and then the market can move

507
00:24:09,280 --> 00:24:12,280
Speaker 8: beyond it. So what that means is that Washington can

508
00:24:12,359 --> 00:24:15,400
Speaker 8: create noise, it can create a little bit of volatility

509
00:24:15,480 --> 00:24:18,000
Speaker 8: for the markets, but I don't believe it's going to

510
00:24:18,080 --> 00:24:19,840
Speaker 8: ruin the bull trend in the markets.

511
00:24:20,600 --> 00:24:23,800
Speaker 2: Marion, your clients can now actually get a yield in

512
00:24:23,880 --> 00:24:26,240
Speaker 2: the bond market, I mean the two year treasuries four

513
00:24:26,280 --> 00:24:30,000
Speaker 2: point three percent. How do you think about fixed income

514
00:24:30,000 --> 00:24:33,720
Speaker 2: allocations these days? Are you sticking with treasuries? Do you

515
00:24:33,760 --> 00:24:35,119
Speaker 2: take some credit risk? How do you think about the

516
00:24:35,160 --> 00:24:36,520
Speaker 2: fixed income side of the game.

517
00:24:37,680 --> 00:24:41,479
Speaker 8: So spreads in the fixed income market are very very narrow,

518
00:24:41,760 --> 00:24:45,040
Speaker 8: but we don't see a risk of a recession so

519
00:24:45,040 --> 00:24:48,359
Speaker 8: we don't think there's a ton of risk if you

520
00:24:48,400 --> 00:24:53,080
Speaker 8: can go into you know, corporates. We're not a fan

521
00:24:53,160 --> 00:24:58,160
Speaker 8: of treasuries. We wouldn't go long duration here either. So

522
00:24:58,320 --> 00:25:03,120
Speaker 8: we're being very, very sle lactive in where we're allocating

523
00:25:04,480 --> 00:25:09,240
Speaker 8: our fixed income portfolio with that set though a lot

524
00:25:09,240 --> 00:25:12,320
Speaker 8: of clients like sitting in that cash that was able

525
00:25:12,359 --> 00:25:15,640
Speaker 8: to get five percent and they're not moving it. So

526
00:25:16,080 --> 00:25:19,720
Speaker 8: we have almost seven trillion dollars in the money market fund,

527
00:25:20,080 --> 00:25:22,320
Speaker 8: and to be honest, I only see that going up.

528
00:25:22,400 --> 00:25:23,800
Speaker 8: I don't see you going down yet.

529
00:25:24,480 --> 00:25:26,199
Speaker 3: Marian, Thank you so much. We appreciate that.

530
00:25:26,560 --> 00:25:30,480
Speaker 2: Marion Bartel's chief investment strategists at Sanctuary Wealth got a

531
00:25:30,480 --> 00:25:32,400
Speaker 2: bullish call there again on S and P. Five hundred

532
00:25:32,400 --> 00:25:35,119
Speaker 2: twelve month twelve month out seventy two hundred to seventy

533
00:25:35,119 --> 00:25:37,600
Speaker 2: four hundred, one of the higher numbers that we've seen

534
00:25:37,640 --> 00:25:38,520
Speaker 2: out there on the street.

535
00:25:39,119 --> 00:25:43,800
Speaker 1: This is the Bloomberg Intelligence Podcast, available on Apple, Spotify,

536
00:25:44,000 --> 00:25:47,480
Speaker 1: and anywhere else you get your podcasts. Listen live each

537
00:25:47,520 --> 00:25:51,240
Speaker 1: weekday ten am to noon Eastern on Bloomberg dot com,

538
00:25:51,400 --> 00:25:54,920
Speaker 1: the iHeartRadio app tune In, and the Bloomberg Business app.

539
00:25:55,359 --> 00:25:58,280
Speaker 1: You can also watch us live every weekday on YouTube

540
00:25:58,680 --> 00:26:00,879
Speaker 1: and always on the Blue Lumberg terminal.

541
00:26:04,400 --> 00:26:04,720
Speaker 3: YAHM