WEBVTT - Yen Falls After October US CPI Print

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<v Speaker 1>Welcome to the Bloomberg day Break Asia podcast. I'm Doug Krisner.

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<v Speaker 1>The latest data on US retail inflation supports the case

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<v Speaker 1>for another FED rate cut next month. A bit later,

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<v Speaker 1>we'll be joined by Chris Carey, portfolio manager at the

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<v Speaker 1>Carnegie Investment Council. We'll begin by looking at today's price

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<v Speaker 1>section with Mary Nicola, Bloomberg m Live strategist. She joins

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<v Speaker 1>us from our studios in Singapore. The bond market is

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<v Speaker 1>still reacting to President Elect Trump's victory and the implication

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<v Speaker 1>that we're going to see a lot more in the

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<v Speaker 1>way of inflationary pressures building more so at the long

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<v Speaker 1>end and than the short end. And what the backup

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<v Speaker 1>and yield has done at the same time is strengthened

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<v Speaker 1>the dollar quite a bit. The Bloomberg Dollar Spot Index

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<v Speaker 1>was up today by four tenths of one percent, and

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<v Speaker 1>I think the index has been up for five of

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<v Speaker 1>the past six trading days. Can you see any end

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<v Speaker 1>in sight for this rally that we have seen in

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<v Speaker 1>the dollar?

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<v Speaker 2>Yeah, you know, it's interesting. I was thinking about today

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<v Speaker 2>what would trigger a reversal in the door, and I

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<v Speaker 2>think one thing would come is likely. Let's say you

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<v Speaker 2>get a weak labor market data, that could be one

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<v Speaker 2>thing that could come through. But for now, it looks

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<v Speaker 2>like everyone's so focused on the Trump administration, the potential

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<v Speaker 2>policies tariffs, especially in this part of the world, and

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<v Speaker 2>what are the implications from tariffs here. Of course, last time,

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<v Speaker 2>we still remember what happened in twenty eighteen nineteen and

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<v Speaker 2>the implications on the CNY and how much it weakened

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<v Speaker 2>and how much currencies across Asia Asia had weakened as

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<v Speaker 2>a result. So there's still that overhang and that cloud

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<v Speaker 2>that's really overtaken the region of what happens next. And

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<v Speaker 2>of course, because Trumps, the new Trump administration has come

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<v Speaker 2>in with a lot of China hawks and fulfilling a

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<v Speaker 2>lot of the promises, and that's the concern is will

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<v Speaker 2>they fulfill some of the promises on tariffs.

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<v Speaker 1>So you saw today that the CPI print here in

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<v Speaker 1>the US was pretty much smack in line with market forecast,

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<v Speaker 1>and I think there's an eighty percent probability that we're

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<v Speaker 1>going to get a twenty five bases point rate cut

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<v Speaker 1>in December. But a number of Fed officials today we're

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<v Speaker 1>saying there's a little bit of uncertainty over how far

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<v Speaker 1>the Fed will need to go in lowering rates. I

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<v Speaker 1>think there's a real concern about overshooting whatever the neutral

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<v Speaker 1>rate is right now, and perhaps if they were to overshoot,

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<v Speaker 1>you could get a lot more in the way of inflation.

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<v Speaker 3>Yeah.

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<v Speaker 2>Absolutely, And of course now we have confirmation of the

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<v Speaker 2>Republican trifecta, so essentially we know that any sort of

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<v Speaker 2>passage of tax cuts further fiscal expansion is likely, and

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<v Speaker 2>I think that's where the Fed is going to try

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<v Speaker 2>and stay a little bit more cautious, even though, of course,

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<v Speaker 2>as Jerome Powell said last week, it's not going to

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<v Speaker 2>affect them in the near term, but it's obviously something

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<v Speaker 2>that they're going to continually be thinking about, especially because

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<v Speaker 2>they're still just trying to get inflation down and it's

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<v Speaker 2>moving in the right direction, and that's what the Fed

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<v Speaker 2>officials are talking about, is it's moving in that right direction,

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<v Speaker 2>but that last mile is just becoming a little bit

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<v Speaker 2>more difficult.

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<v Speaker 1>So let's talk about something that's on the flip side

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<v Speaker 1>of dollar strength, and that's the end weakness. We've got

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<v Speaker 1>a one fifty five handle right now. I think we're

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<v Speaker 1>waiting to hear something from officials in Japan about the

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<v Speaker 1>degree to which we have seen this rapid weakening in

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<v Speaker 1>the end, is intervention or risk at this point.

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<v Speaker 2>Yeah, the radio silence is quite interesting, but the thing

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<v Speaker 2>is it's not only focused on the end, so nobody

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<v Speaker 2>is everyone's been a victim of the dollar strength, right,

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<v Speaker 2>So I think that there's sympathy because of the fact

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<v Speaker 2>that everyone's everything is moving in tandem. Where you've got

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<v Speaker 2>euro ausy, everyone is moving, just they're all weakening. So

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<v Speaker 2>there's probably a little bit more of a reluctance to

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<v Speaker 2>really step in when it's happening across the board. But

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<v Speaker 2>what it has been interesting is what we've seen from

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<v Speaker 2>the Chinese authorities, and they're pushing back, trying to show

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<v Speaker 2>that the CNY is not a one way bet. But

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<v Speaker 2>I think for Japan it's just going to be a

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<v Speaker 2>little bit more difficult, especially given how much it's dependent

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<v Speaker 2>on what's happening in the US.

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<v Speaker 1>So you mentioned the CNY, let's talk about China next.

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<v Speaker 1>The possibility that we're going to see pretty tough tariffs

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<v Speaker 1>on Chinese imports into the United States. I would imagine

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<v Speaker 1>that's a big concern if you're an exporter in China.

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<v Speaker 1>I mean, to what extent is the currency going to

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<v Speaker 1>begin to reflect it. I think we had a guest

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<v Speaker 1>yesterday saying that she wouldn't be surprised if we went

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<v Speaker 1>to seven to twenty seven on the offshore.

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<v Speaker 3>Is that possible?

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<v Speaker 2>Yeah, I think at this point, especially because we don't

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<v Speaker 2>know the extent of how big the tariffs could be,

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<v Speaker 2>I think that is a very very much a possibility

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<v Speaker 2>of the yuani weakening considerably, and then of course the

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<v Speaker 2>momentum of that just going even further. But of course

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<v Speaker 2>for them, for authorities, not only in China but across

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<v Speaker 2>the region, it's about this about at the pace of

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<v Speaker 2>the depreciation, and so anytime they see some sort of

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<v Speaker 2>rapid pace of depreciation, they will step in at least

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<v Speaker 2>to smooth out the volatility. We see that all the

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<v Speaker 2>time in India. We're going to see it in China

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<v Speaker 2>as well. So I think that's one thing that we

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<v Speaker 2>should be expecting more in the coming months.

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<v Speaker 1>What are some of the other issues that your colleagues

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<v Speaker 1>on the m Live blogger are highlighting this morning.

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<v Speaker 2>Yeah. I think some of the key things that we're

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<v Speaker 2>focused on is, you know, is this rally in equity

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<v Speaker 2>market sustainable. We've obviously had a few days of a drawback,

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<v Speaker 2>but the fact is that there's been a really strong

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<v Speaker 2>momentum behind equities, really strong momentum behind bitcoin as well.

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<v Speaker 2>So does that continue? And it's all because of the

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<v Speaker 2>Trump trades? So how long? What is the longevity of

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<v Speaker 2>a lot of these Trump trades? And I think that's

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<v Speaker 2>maybe the key focus of how does this play out?

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<v Speaker 2>I think for equity markets, the real test for them

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<v Speaker 2>is going to be in Vidia next week, because that's

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<v Speaker 2>going to be the big one yep. And of course

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<v Speaker 2>it will lay out the Obviously we're so used to

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<v Speaker 2>in Nvidia having skyrocket amazing results and if they don't deliver,

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<v Speaker 2>the market gets upset, so they're going to have to

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<v Speaker 2>exceed expectation.

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<v Speaker 1>It was interesting that you mentioned bitcoin there. I can

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<v Speaker 1>remember years ago people saying that you could use this

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<v Speaker 1>cryptocurrency as a hedge against inflation. Right, so today we

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<v Speaker 1>break above ninety three grand Is any part of this

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<v Speaker 1>trade reflecting concern about rising inflation? Do you think? Is

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<v Speaker 1>it tracking what the long end of the bond market

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<v Speaker 1>may be telling us just a bit or is it

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<v Speaker 1>something completely different?

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<v Speaker 2>I don't think so I think a lot of that

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<v Speaker 2>has to do with the fact that you've got a

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<v Speaker 2>republican trifecta regulation is not likely to come in on

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<v Speaker 2>a lot of the crypto side. I think there's just

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<v Speaker 2>a lot of exuberance around crypto because of the new

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<v Speaker 2>administration and its potential friendliness towards the sphere more so

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<v Speaker 2>than an inflation hedge.

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<v Speaker 1>Let's talk a little bit about China before I let

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<v Speaker 1>you go, and the degree to which the equity market

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<v Speaker 1>is a gauge of positive sentiment. Are you seeing signs

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<v Speaker 1>now that there is a little bit of upward bias

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<v Speaker 1>in equity trading on the mainland and might that suggest

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<v Speaker 1>that maybe the Chinese economy is bottoming and people are

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<v Speaker 1>starting to feel a little bit better about some of

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<v Speaker 1>the policies that the government's pushing out.

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<v Speaker 2>So to some degree, you know, when Chinese authorities came

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<v Speaker 2>out with the share buybacks and the encouragement of share buybacks,

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<v Speaker 2>they've put a floor under equities to some degree. And

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<v Speaker 2>of course, when you have the national team coming in

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<v Speaker 2>when they do, when there is a stark sell off,

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<v Speaker 2>so there has been a bit of a floor in

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<v Speaker 2>terms of the policies. I think the market has essentially

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<v Speaker 2>been disappointed overall in how much in terms of we

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<v Speaker 2>haven't gotten anything really on pushing consumer demand. We haven't

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<v Speaker 2>gotten anything in detail about what they will do on

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<v Speaker 2>the property supply stuff. So I think they're talking about

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<v Speaker 2>next year we'll get more forceful measures. But you and

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<v Speaker 2>I know that the market tends to be impatient. So

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<v Speaker 2>we've got a lot of foreign investors moved back into China,

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<v Speaker 2>but if it doesn't deliver, I think they'll get impatient

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<v Speaker 2>again and start pulling out.

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<v Speaker 1>Mary, thank you so much for playing along. It's always

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<v Speaker 1>a pleasure to visit with you. Mary Nicola is Bloomberg

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<v Speaker 1>m Live strategist joining us from Singapore here on the

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<v Speaker 1>Daybreak Asia podcast. Joining us now is Chris Carey. He

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<v Speaker 1>is portfolio manager at Carnegie Investment Council, joining us from Cleveland, Ohio. Chris,

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<v Speaker 1>thanks for taking time. I'd like to get your take

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<v Speaker 1>to begin with on what the incoming Trump administration means

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<v Speaker 1>from not only markets, but the economy as well. Now,

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<v Speaker 1>one of the things that's been striking here since the

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<v Speaker 1>election has been this rally in bitcoin. I think it

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<v Speaker 1>is up about thirty five percent since the President elects victory.

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<v Speaker 1>What do you make of of what Trump means right

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<v Speaker 1>now for financial markets?

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<v Speaker 3>I definitely think that the Trump administration is is definitely

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<v Speaker 3>welcome to financial markets, especially with regards to, you know,

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<v Speaker 3>some of the the dampening effects we had over the

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<v Speaker 3>last four years with the parcel Lena Kah and her

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<v Speaker 3>tenure at the FTC. I think that the negative pressures

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<v Speaker 3>of the wire in terms of the M and A environment,

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<v Speaker 3>it's going to be good to be able to see

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<v Speaker 3>those lifts, especially for for large cap tech. I think

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<v Speaker 3>that's definitely a benefit. And then also on the tax

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<v Speaker 3>side of things too, I think the continuation of you know,

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<v Speaker 3>the Tax Cut and Jobs Act potentially even lowering earnings

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<v Speaker 3>sorry not earnings taxes even further for corporations, you know,

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<v Speaker 3>it's definitely obviously going to support their bottom line. I

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<v Speaker 3>think that's reflected in the markets. It's going to be

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<v Speaker 3>interesting to see, though, you know, kind of with everything

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<v Speaker 3>when it come to when it comes to that whether

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<v Speaker 3>you know he's going to actually go through on what

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<v Speaker 3>actually you know he says.

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<v Speaker 1>But is it there some concern about the potential inflationary

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<v Speaker 1>impact of some of these policies. I'm looking at the

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<v Speaker 1>behavior of the bond market, just watching yields back up

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<v Speaker 1>since the election, does that concern you?

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<v Speaker 3>Yeah, I mean I think there's definitely some concerns that

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<v Speaker 3>his policies could be you know, inflationary. But I guess

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<v Speaker 3>the other side of the coin is that when you're

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<v Speaker 3>able to stimulate economic growth, you don't have to cut

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<v Speaker 3>interest rates as much as you might have had to.

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<v Speaker 3>So I really do think it's only going to be,

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<v Speaker 3>you know, a matter of time until we see what

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<v Speaker 3>really is going to be the you know, the reason

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<v Speaker 3>why rates rates are arising. If you're looking at inflation,

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<v Speaker 3>I mean, what eighteen months ago we had nine percent CPI,

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<v Speaker 3>Now we're down to two point six percent. That's a

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<v Speaker 3>job well done, as is. I know the Fed targets

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<v Speaker 3>two percent, but two point six for you know CPI

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<v Speaker 3>that we've got today is still pretty damn good. I

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<v Speaker 3>also think with regards to the threast of the tariffs, it's,

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<v Speaker 3>you know, you say one thing, but is that actually

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<v Speaker 3>going to be what he follows through with. I think

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<v Speaker 3>they're probably going to use more as a negotiating tool

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<v Speaker 3>than actually seeing these you know, widespread twers being slapped

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<v Speaker 3>on which would have inflationary effects. But there's definitely fears.

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<v Speaker 3>You're definitely starting to see that.

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<v Speaker 1>Well, you were talking a moment ago or alluding to

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<v Speaker 1>the fact that we may be seeing less regulatory risk

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<v Speaker 1>when it comes to big cap tech, But I'm wondering

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<v Speaker 1>about the financials as well. Could they perhaps benefit from

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<v Speaker 1>less regulation.

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<v Speaker 3>Yeah, definitely, they definitely poist a benefit from a less

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<v Speaker 3>regulated landscape. The economy still is strong. If we're able

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<v Speaker 3>to avoid those, you know, significant loan losses, I think

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<v Speaker 3>that's fantastic as well as you know, encouraging more consolidation

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<v Speaker 3>within the banking space. You know, large cap banks still

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<v Speaker 3>traded pretty appealing multiples. I think that the you know,

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<v Speaker 3>and that's reflected in the chart, and it's not just

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<v Speaker 3>banks too. I think that, you know, the whole financial

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<v Speaker 3>sector of the whole does stand to benefit as a result.

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<v Speaker 1>One of the things we were talking about yesterday was

0:12:07.880 --> 0:12:11.120
<v Speaker 1>this Department of Government Efficiency that the President elect is

0:12:11.160 --> 0:12:14.480
<v Speaker 1>putting in place. Elon Musk will be working in conjunction

0:12:14.600 --> 0:12:16.760
<v Speaker 1>with Vivek Ramaswani, and the two are going to be

0:12:16.800 --> 0:12:20.679
<v Speaker 1>task essentially with looking for ways to cut excess regulation

0:12:20.840 --> 0:12:25.120
<v Speaker 1>to reduce wasteful expenditures and restructure some federal agencies. That's

0:12:25.240 --> 0:12:27.880
<v Speaker 1>pretty ambitious. Do you think they're going to make a

0:12:27.920 --> 0:12:28.719
<v Speaker 1>lot of headway with this?

0:12:29.360 --> 0:12:33.800
<v Speaker 3>It is definitely a remarkably ambitious thing that they are undertaking.

0:12:34.400 --> 0:12:37.080
<v Speaker 3>I think they will probably be able to make some

0:12:37.080 --> 0:12:40.120
<v Speaker 3>some headway. The fact now, though, is that you know,

0:12:40.920 --> 0:12:44.480
<v Speaker 3>the federal budget has just ballooned and we're at a

0:12:44.520 --> 0:12:48.360
<v Speaker 3>point now where interest payments are making up more of

0:12:48.400 --> 0:12:52.640
<v Speaker 3>the budget than defenses. I think that it's great that

0:12:53.160 --> 0:12:58.400
<v Speaker 3>we are finally paying attention to the deficit. It's really

0:12:58.400 --> 0:13:01.040
<v Speaker 3>going to be the case. Though we've had decades of

0:13:01.080 --> 0:13:03.520
<v Speaker 3>complaining about a ballooning deficit, someone's going to try and

0:13:03.559 --> 0:13:07.000
<v Speaker 3>do something about it. If they're successful, that's that's tremendous,

0:13:07.000 --> 0:13:08.600
<v Speaker 3>and you know, being able to chip away at that.

0:13:08.679 --> 0:13:11.439
<v Speaker 3>There are tons of inefficiencies and the fact that you know,

0:13:11.520 --> 0:13:15.600
<v Speaker 3>the government pays you know, insane multiples for for for

0:13:15.679 --> 0:13:18.920
<v Speaker 3>goods and services that you and I would pay as

0:13:19.320 --> 0:13:22.360
<v Speaker 3>as business owners or consumers. So I definitely think there

0:13:22.400 --> 0:13:25.400
<v Speaker 3>is definitely some fact that can be chopped off. The

0:13:25.440 --> 0:13:29.880
<v Speaker 3>magnitude of those cuts will only be able to see

0:13:29.880 --> 0:13:32.160
<v Speaker 3>with time. But you know, as silly as the name is,

0:13:32.400 --> 0:13:36.280
<v Speaker 3>and I think that it's definitely welcome and I'm going

0:13:36.360 --> 0:13:37.960
<v Speaker 3>to be very interested to see what we're able to

0:13:37.960 --> 0:13:40.160
<v Speaker 3>actually pull off, like a lot of the things that

0:13:40.559 --> 0:13:43.040
<v Speaker 3>have been promised that you know, led to led to

0:13:43.720 --> 0:13:46.280
<v Speaker 3>Trump getting elected. You know, you can talk the talk,

0:13:46.320 --> 0:13:47.080
<v Speaker 3>but can you walk the walk.

0:13:47.200 --> 0:13:49.720
<v Speaker 1>Yeah, most definitely. Maybe we can talk a little bit

0:13:49.720 --> 0:13:52.360
<v Speaker 1>about what you're seeing off shore. One of the things

0:13:52.360 --> 0:13:56.720
<v Speaker 1>that's happening in China is the early, maybe green shoots

0:13:56.720 --> 0:13:58.920
<v Speaker 1>of some sort of recovery. We know that government has

0:13:59.240 --> 0:14:01.960
<v Speaker 1>applied a lot of stimulus, but I think there are

0:14:01.960 --> 0:14:05.320
<v Speaker 1>a number of analysts that agree that the risk right

0:14:05.360 --> 0:14:08.360
<v Speaker 1>now to a recovery in China is being a bit

0:14:08.440 --> 0:14:13.280
<v Speaker 1>derailed by the possibility that these threats of tariffs from

0:14:13.280 --> 0:14:16.840
<v Speaker 1>President elect Trump would be very real, targeting obviously those

0:14:17.160 --> 0:14:21.480
<v Speaker 1>Chinese shipments exports from China to the United States. Do

0:14:21.520 --> 0:14:23.680
<v Speaker 1>you think this has the potential to hold China back

0:14:23.720 --> 0:14:24.840
<v Speaker 1>in a very big way?

0:14:25.480 --> 0:14:28.120
<v Speaker 3>I definitely think so, you know, tarifs or not. You're

0:14:28.160 --> 0:14:31.960
<v Speaker 3>already starting to see that companies are diversified in their

0:14:32.160 --> 0:14:35.320
<v Speaker 3>supply chain away from China to begin with, you know,

0:14:35.400 --> 0:14:39.080
<v Speaker 3>to to other places in Asia. I think that you know,

0:14:39.200 --> 0:14:42.360
<v Speaker 3>the threat of tariffs will have a material impact on

0:14:42.440 --> 0:14:45.280
<v Speaker 3>the Chinese economy. I think that unless are right to

0:14:46.040 --> 0:14:49.720
<v Speaker 3>be concerned about it. It's one reason another reason why

0:14:50.480 --> 0:14:54.400
<v Speaker 3>at off and we prefer to favor US stocks VERSU

0:14:54.400 --> 0:14:56.920
<v Speaker 3>international especially, you know, we only have an exposure to

0:14:57.000 --> 0:15:01.480
<v Speaker 3>China just because you know, there's such a export driven

0:15:01.680 --> 0:15:05.800
<v Speaker 3>economy and they rely so much on the United States.

0:15:06.440 --> 0:15:08.960
<v Speaker 3>I think it's definitely a very big risk and I

0:15:09.000 --> 0:15:11.640
<v Speaker 3>wouldn't want to be exposed to China at the moment.

0:15:11.720 --> 0:15:14.560
<v Speaker 1>So if you're favoring US markets right now, and assuming

0:15:14.560 --> 0:15:17.040
<v Speaker 1>that we're going to see a continuation of economic growth,

0:15:17.080 --> 0:15:19.720
<v Speaker 1>maybe a little bit stronger growth given a lot of

0:15:19.840 --> 0:15:24.680
<v Speaker 1>what we're expecting from the incoming Trump administration, I'm wondering, Chris,

0:15:24.720 --> 0:15:28.160
<v Speaker 1>whether you want to be more exposed to companies that

0:15:28.280 --> 0:15:32.240
<v Speaker 1>are particularly economically sensitive in the small cap space.

0:15:32.720 --> 0:15:36.280
<v Speaker 3>Yeah, definitely. I mean small cups have definitely had a

0:15:36.280 --> 0:15:40.280
<v Speaker 3>pretty tough time, you know, prior to the lasts a

0:15:40.320 --> 0:15:44.040
<v Speaker 3>month or so, based on the fact that interest rates

0:15:44.080 --> 0:15:45.720
<v Speaker 3>are high. I think that the fact that we're starting

0:15:45.760 --> 0:15:47.880
<v Speaker 3>to see those cut we just saw that from based

0:15:47.920 --> 0:15:50.360
<v Speaker 3>on the CPI figures that there was no upside surprise

0:15:50.800 --> 0:15:54.440
<v Speaker 3>that the chance of another rate cut in December is

0:15:54.480 --> 0:15:56.960
<v Speaker 3>now twenty percent. I think that's terrific. I think that

0:15:57.160 --> 0:16:03.360
<v Speaker 3>definitely provides some upward momentum for small caps. Overall, though,

0:16:03.720 --> 0:16:06.040
<v Speaker 3>I think that you know, US is the best place

0:16:06.080 --> 0:16:08.040
<v Speaker 3>in the business, a less place in the world to

0:16:08.080 --> 0:16:12.120
<v Speaker 3>do business. It's why the vast purity of companies are

0:16:12.160 --> 0:16:17.840
<v Speaker 3>founded here. We have great regulatory environment, legal environment. All

0:16:17.880 --> 0:16:20.600
<v Speaker 3>the best companies are set up here. I think that,

0:16:21.200 --> 0:16:26.120
<v Speaker 3>especially with Trump coming to into office as well, you know,

0:16:26.320 --> 0:16:29.000
<v Speaker 3>it's likely that US markets are going to outperform national

0:16:29.040 --> 0:16:31.920
<v Speaker 3>markets like they did you know in Trump Trade one

0:16:31.920 --> 0:16:34.880
<v Speaker 3>point zero if you will. We do have the strongest economy.

0:16:35.480 --> 0:16:38.640
<v Speaker 3>I think history indicates stronger re terms for US aputies,

0:16:38.680 --> 0:16:41.320
<v Speaker 3>at LEAs relative to their global counterparts.

0:16:41.400 --> 0:16:43.440
<v Speaker 1>Since the election, I think we can agree that there's

0:16:43.440 --> 0:16:46.000
<v Speaker 1>been a pretty powerful rally in risk assets, and I'm

0:16:46.000 --> 0:16:48.000
<v Speaker 1>curious to get your take as to whether or not

0:16:48.000 --> 0:16:51.720
<v Speaker 1>there's some vulnerability here that maybe we've come pretty far

0:16:52.000 --> 0:16:54.840
<v Speaker 1>in a short period of time and a pullback might

0:16:54.880 --> 0:16:55.440
<v Speaker 1>be in order.

0:16:55.720 --> 0:16:58.840
<v Speaker 3>Is that possible? We definitely come pretty far. I would

0:16:58.880 --> 0:17:01.960
<v Speaker 3>also say, though, that you know, even though we're twenty

0:17:02.000 --> 0:17:05.719
<v Speaker 3>four to twenty five percent strength, but get strength. You know.

0:17:05.880 --> 0:17:09.440
<v Speaker 3>It's I think over the last one hundred years, eighteen

0:17:09.520 --> 0:17:12.440
<v Speaker 3>of those we've had a the S and P has

0:17:12.520 --> 0:17:14.639
<v Speaker 3>ended up plus thirty percent. You take that down, you know,

0:17:14.680 --> 0:17:16.959
<v Speaker 3>anything above twenty five, it's a quarter of you know,

0:17:17.160 --> 0:17:19.560
<v Speaker 3>all years going back that period of time they've been

0:17:19.600 --> 0:17:22.439
<v Speaker 3>up there. And when you have the equity market up

0:17:22.440 --> 0:17:24.600
<v Speaker 3>twenty five percent in a given year, typically the next

0:17:24.680 --> 0:17:27.760
<v Speaker 3>year returns from there are still you know, plus eight

0:17:27.760 --> 0:17:31.960
<v Speaker 3>plus ten percent. I definitely think that maybe in the

0:17:32.000 --> 0:17:35.320
<v Speaker 3>short term we're a little bit overbought, and there definitely

0:17:35.400 --> 0:17:40.440
<v Speaker 3>is some exuberance, but I think that we are rerating

0:17:40.720 --> 0:17:44.680
<v Speaker 3>for potentially a much more favorable business environment, so it

0:17:44.720 --> 0:17:49.040
<v Speaker 3>doesn't really affect our long term positioning in terms of

0:17:49.359 --> 0:17:50.960
<v Speaker 3>being long US equities.

0:17:51.240 --> 0:17:53.320
<v Speaker 1>Chris will leave it there. Thanks for joining us. Chris

0:17:53.359 --> 0:17:57.560
<v Speaker 1>Carey is portfolio manager at the Carnegie Investment Council, joining

0:17:57.600 --> 0:18:03.800
<v Speaker 1>from Cleveland, Ohio. Here on the Daybreak Asia. This is

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<v Speaker 1>Bloomberg day Break Asia, your morning brief on the stories

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