Speaker 1: Bloomberg Audio Studios, podcasts, radio news the single best idea.
Speaker 1: Shout out to Robin Wigglesworth. Bloomberg does a great job
Speaker 1: as this as well, but Robin's the one at the
Speaker 1: FT that sort of codified it, which is the comedy
Speaker 1: act of keeping track of the annual outlooks. Here's the
Speaker 1: way it works, folks, in the vicinity of October. If
Speaker 1: you have the same marketing staff within investment research, you
Speaker 1: go through the exitd you go to the ballet again,
Speaker 1: and you have some meetings, and you get your outlook,
Speaker 1: and you write a draft and fourteen people look at it.
Speaker 1: Usually et cetera, et cetera, et cetera. Maybe it's a
Speaker 1: PowerPoint virginny masin if today had a brilliant PowerPoint very
Speaker 1: valuable from Alion's. And then you can have a seven
Speaker 1: page outlook or dare I say a thirty seven page outlook.
Speaker 1: The nightmare is when you get a new marketing team
Speaker 1: on Wall Street, because they have to prove themselves, and
Speaker 1: so in October the new marketing team at any given
Speaker 1: firm is going mental about they got to have the
Speaker 1: one investment outlook to be all and end all, and
Speaker 1: Robin over at the ft keeps track of like I
Speaker 1: don't know twenty thirty forty of these outlooks is they
Speaker 1: go into the new year and everyone knows, including the
Speaker 1: entire Bloomberg surveillance team, they're useless. I mean, basically, I'll
Speaker 1: be polite and say John Ferrell talks about the end
Speaker 1: of March. Maybe you get to the end of February
Speaker 1: and they seem ancient. What was written on December twentieth
Speaker 1: to take a to pick a date as well. What
Speaker 1: we try to do is move away from the outlooks
Speaker 1: more to the discussion. We begin with Jeffrey Rosenberg of
Speaker 1: Black Rock here talking about the nuances of the yield
Speaker 1: curve of if the two year moves, the ten year
Speaker 1: might not.
Speaker 2: You guys will remember the old greens band cut undrum.
Speaker 2: Right then he was raising rates, but long term rates
Speaker 2: weren't going up. They were going down because back then
Speaker 2: China was rebalancing, not rebouncing, reinvesting all of his trade
Speaker 2: surpluses back into treasuries, and we couldn't understand why the
Speaker 2: Fed couldn't control long term interest rates. So I've talked
Speaker 2: about the possibility that we could see the new conundrum.
Speaker 2: What's the new conundrum is here we're cutting interest rates
Speaker 2: in the short end, but the long end isn't responding.
Speaker 2: That's exactly what happened in August, right, we cut interest
Speaker 2: rates fifty basis points, the long end went up. And
Speaker 2: I think when you look into twenty twenty five, right,
Speaker 2: we've taken down the amount of cuts that the Fed
Speaker 2: is expected, but they're still expected to cut rates and
Speaker 2: if they do, and this is what yesterday's inflation print
Speaker 2: is kind of worrisome is we're kind of getting into
Speaker 2: the consensus around this sticky inflation. Okay, so why are
Speaker 2: they cutting next month not next month, next week? Because
Speaker 2: they want to support the job market and the concerned
Speaker 2: about the tightening. So they're showing their hand that there's
Speaker 2: a little bit of preference for the labor market over
Speaker 2: the inflaew Okay, Well that's a problem for the rate
Speaker 2: cutting cycle because you can cut the front end, but
Speaker 2: the back end may be more worried about that sticky
Speaker 2: inflation and worried about some of those longer term issues
Speaker 2: around debt and deficits in the fiscal policy side.
Speaker 1: An extended conversation with Jeffrey Rosenberg of Blackrock program note
Speaker 1: for those of you listening to single Best Idea on
Speaker 1: this Thursday tomorrow, Gene Munster and Dan ives together on
Speaker 1: MAG seven. Really looking forward to that, and yes I
Speaker 1: usually don't, but I'm going to you gotta focus on
Speaker 1: Tesla right now as a moonshot. We'll probably lead off
Speaker 1: talking about Tesla with Munster and Eyes. We'll do that tomorrow.
Speaker 1: On the equity markets, there's different characters, not of permables,
Speaker 1: but bulls writing with a certain force, a certain intelligence,
Speaker 1: and one of those clearly is Brian Belski of BEMO Capital.
Speaker 1: He was on Fired Today intercourse. Deserves to be within
Speaker 1: this great bull market. He talks about the factor. He's
Speaker 1: not a big fan. He's looking at fundamental things like
Speaker 1: earning's growth, free cash flow growth on momo momentum, Belski
Speaker 1: of Bemo.
Speaker 3: One of the things that quite frankly drives us crazy
Speaker 3: is everyone talking about this momentum investing. But if you
Speaker 3: go back to nineteen ninety in the US DOC market,
Speaker 3: you look at rolling returns, the best five factors, which
Speaker 3: your almost talk about factors are fundamental. Number one is
Speaker 3: low price, but the rest of them are price to
Speaker 3: free cash flow, enterprise. Valey toe, but earning's growth increasing
Speaker 3: over the next three months, so I think we're returning
Speaker 3: to that slowly, which again favors amazing assets here in
Speaker 3: the United States, and that's why we're overweight technology, financials,
Speaker 3: and consumer discretionary in a little bit in the communication
Speaker 3: services area, especially considering those are the growth areas. But
Speaker 3: really from a consistency of growth bases, Tommy, they're the
Speaker 3: most consistent growers.
Speaker 1: I mean, Brian Belski, they're calling me Tommy. I mean
Speaker 1: my mother called me Tommy. Usually I was in trouble
Speaker 1: when I was Tommy. Brian Belski of BMO Capital Markets
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