Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney. Alongside
Speaker 1: my co host Matt Miller. Every business day we bring
Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along
Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and
Speaker 1: at Bloomberg dot com slash podcast Soil. Thanks so much
Speaker 1: for joining us here. How shall we think about these
Speaker 1: equity markets in two given the strong performance we had? Well, Paul,
Speaker 1: first of all, to you and Tailor. Happy new year.
Speaker 1: Thank you very much for having me on again. UM,
Speaker 1: so good news and bad news. Good news is that
Speaker 1: last year the stock market was up almost thirty on
Speaker 1: a total return basis. We've been up more than a
Speaker 1: hundred since the bottom of the market last March. Earnings
Speaker 1: last year probably up about fifty five zero percent year
Speaker 1: on year. UM, that's not the kind of year we're
Speaker 1: looking for In calendar to me too, earnings maybe will
Speaker 1: be up eight percent year on year. We think we've
Speaker 1: seen as much multiple expansion as we're going to get,
Speaker 1: and we do expect that. You know, the bias in
Speaker 1: terms of interest rates and the Fed is higher. Um,
Speaker 1: So I don't think we're getting a multiple expansion. We've
Speaker 1: got a fifty three hundred target on the SMP five
Speaker 1: hundred are hundred call of course for last year, so
Speaker 1: that gives us, you know, roughly a ten percent move
Speaker 1: higher now is pretty good, uh, you know, uh, in
Speaker 1: a normal year. But it's not you know, the thirty
Speaker 1: percent we saw last year, the percent we've seen over
Speaker 1: the last couple of years. So I guess what I'm
Speaker 1: saying is we need to mute our expectations a lot
Speaker 1: more volatility in our view in calendar twenty two. And
Speaker 1: that volatility, Phil, does it come from at least some
Speaker 1: of the surveys that Bloomberg has done, It is all
Speaker 1: about inflation less. So about COVID, how are you thinking
Speaker 1: about the volatility and the risks and where that stems from? Oh, Taylor,
Speaker 1: that's a great question. Um. You know, when you look
Speaker 1: at COVID, maybe we've got a somewhat out of consensus
Speaker 1: view that we're looking at the you know, the cycles
Speaker 1: in South Africa, the cycles in the European Union, in
Speaker 1: the UK, and the cycles here in the United States,
Speaker 1: and we've got a view that that am Acron is
Speaker 1: going to peak here maybe you know, by the end
Speaker 1: of this month, uh, and become much less a big
Speaker 1: deal uh than it's been over the last couple of months. Now,
Speaker 1: that's not to say that we don't know what the
Speaker 1: next variant is going to be. Is the next variant
Speaker 1: going to be more problematic than am acron? I don't know.
Speaker 1: But as we're looking at the financial markets, where we
Speaker 1: are a lot more concerned about what's going on with
Speaker 1: inflation and more precisely, what's going on with the federal reserves.
Speaker 1: Likely response now while a lot of folks are on vacation,
Speaker 1: the government reported that the Core Personal Consumption Expenditure Index,
Speaker 1: which is the Fed's preferred measure of inflation, rose four
Speaker 1: point seven year on your basis in November. That that
Speaker 1: that's huge And and remember the FEDS target is two,
Speaker 1: where we're you know, will above that. So the FED,
Speaker 1: in our view, did the right thing in accelerating its
Speaker 1: tapering program. We think the taper is going to be
Speaker 1: done by the end of March. We're expecting three quarter
Speaker 1: point rate hikes over the course of next year. But
Speaker 1: but suppose inflation is an even bigger problem than we
Speaker 1: think it is. Does that mean maybe the FED is
Speaker 1: going to shift from quantitative easing to quantitative tightening, shrinking
Speaker 1: its balance sheet, you know, aggressively. And and and maybe
Speaker 1: instead of quarter point rate hikes, maybe the FEDS thinking
Speaker 1: about fifty basis point rate hikes in order to sort
Speaker 1: of catch up from behind the curve. I don't know
Speaker 1: the answer to those questions, but but that's part of
Speaker 1: the uncertain in the volatility that that potentially is in
Speaker 1: store for us over the course of calendar twenty two.
Speaker 1: All right, So given that backdrop, phil um, do I
Speaker 1: stick with the big growth names that have worked for
Speaker 1: me for more than a decade, the Apples, the Amazons
Speaker 1: of the world order, I stick with that cyclical trade.
Speaker 1: But boy, it's been really good over the last eighteen
Speaker 1: twenty four months to whether it's energy or banks. How
Speaker 1: do I think about that? So? Uh, in our view,
Speaker 1: you stick with that cyclical trade, the value trade. And
Speaker 1: and to some degree there's a function of valuation that
Speaker 1: that forward multiples on the SMP five right now around
Speaker 1: you know, twenty times earnings, give or take, which is
Speaker 1: which is high? But I'm not losing any sleep over it.
Speaker 1: But when you look at the growthier names, technology, et cetera.
Speaker 1: Those p's are up in the mid thirties. You look
Speaker 1: at the value names UH Financials, Energy, UH discretionary, UH materials,
Speaker 1: industrials multiples in on those sectors in the mid teens.
Speaker 1: Yet the pricing power and the outsized earnings gains, in
Speaker 1: our view, are going to come from those value categories.
Speaker 1: So as we look at where to invest, where do
Speaker 1: you put new money in calendar twenty two, I think
Speaker 1: there are three places we're focused on. Number one, domestic
Speaker 1: large cap value and we just covered that. Number two
Speaker 1: small cap, particularly on a growth adjusted basis, those valuations
Speaker 1: are very cheap. And then finally, international international is extraordinarily
Speaker 1: chief versus the domestic um. If we're right that am
Speaker 1: aquana is, we're going to roll over here, you know,
Speaker 1: and let's call it the first quarter of the year.
Speaker 1: There's gonna be a cancerup training International. It's gonna start
Speaker 1: at some point during the year. Yeah, all right, Phil,
Speaker 1: thanks so much for joining us. Really appreciate getting your
Speaker 1: thoughts as usual, always giving us some cogent thoughts as
Speaker 1: we take a look at these markets. Are Phil Orlando,
Speaker 1: Chief equity market Strategists and head of client portfolio management
Speaker 1: at Federated Herme's you know what, I think? That six
Speaker 1: billion assets under management, so they know a thing or
Speaker 1: two about these markets. So I've been saying to myself
Speaker 1: at least and maybe even to the audience here, why
Speaker 1: isn't a ten year yield higher? I mean, I got
Speaker 1: the Federal Reserve talking about accelerating tapering at talking about
Speaker 1: raising rates next year, and you know, average Jersey from
Speaker 1: Bloomberg Intelligence said, just focus on the two years you
Speaker 1: are seeing that go up. The tenure will follow. Well,
Speaker 1: maybe it is following a little bit here today up
Speaker 1: about eight basis points, but let's bring in an expert
Speaker 1: who can really answer this question. Prea Misra, Managing director
Speaker 1: and global head of rate strategy at TV Securities. So
Speaker 1: we're seeing a move up in a tenure today. This
Speaker 1: feels like what I should have been seeing all along.
Speaker 1: How do you? How are you thinking about this yield curve? Here?
Speaker 1: As we enter two hi fause thanks for having me
Speaker 1: so um Yes, I think a big puzzle for us
Speaker 1: last year was why the long end rallied. I mean,
Speaker 1: I can see why the fronting should have moved the most,
Speaker 1: as hikes will getting priced in UM, but the long end,
Speaker 1: even a faster taper, it was just rock solid and
Speaker 1: actually lower rates. And so today it could be a
Speaker 1: little bit of catchup. I think also with the rise
Speaker 1: in omicron but hospitalization staying low. You know, I think
Speaker 1: there's a general hope perhaps that the pandemic is moving
Speaker 1: to an endemic state. Risk assets are doing well, so
Speaker 1: today might be more catch up. We have a lot
Speaker 1: of data this week and I'll be watching the ice
Speaker 1: and services data particularly to see if there's any impact
Speaker 1: of omicron on that UM as well as of course
Speaker 1: we have payrolls and the minutes, and that's where I
Speaker 1: think another reason why the long end might sell off,
Speaker 1: as if they talk about balance sheet run off. I
Speaker 1: think that they clearly discussed it in that December meeting,
Speaker 1: and we think the minutes will have more in terms
Speaker 1: of when do they start that. I think that's much
Speaker 1: more bearish for the long end of the curve. So
Speaker 1: we are looking for the tenure to reach two percent
Speaker 1: by your end. You know, there's no clear catalyst today.
Speaker 1: I think it's just more a catch up. Why did
Speaker 1: that started? The longer term catalyst as well as you're
Speaker 1: thinking about inflation, right you know, with the inflation, the
Speaker 1: issue is which part of the curve gets impacted depends
Speaker 1: really on the FED reaction function. So far, it's been
Speaker 1: the front end that's been responding to inflation, because you know,
Speaker 1: the FED was responding through sooner hikes um. But if
Speaker 1: it seems as if the Freed is more cautious, and
Speaker 1: that's why I would look at the growth side. If
Speaker 1: the growth momentum starts to slow down, perhaps due to
Speaker 1: omicron or phiscal drag, we're very nervous about the expiration
Speaker 1: of the Child Act credit and other impact on the consumer,
Speaker 1: then I think the long end can start to respond
Speaker 1: to inflation, because then you should get paid up more
Speaker 1: to take on inflation risk if you're buying the tenure.
Speaker 1: But in the near term, as the FED hiking cycle
Speaker 1: is very much front and center, I think the front
Speaker 1: end is more inflation driven than the very long end
Speaker 1: by background, and so I'm not very sure I'm getting
Speaker 1: all the nuances from this feder Reserve, but it seems
Speaker 1: like the Federal Reserve is doing a very good job
Speaker 1: at telegraphing and messaging what they plan to do in
Speaker 1: two is that your take as well. Are you concerned
Speaker 1: that maybe they could make a mistake here in terms
Speaker 1: of maybe the pace or the rate at which they
Speaker 1: raise rates. Right, So, I think the market is pricing
Speaker 1: in a risk of a policy mistake because even though
Speaker 1: the start of the hiking cycle is well priced, you know,
Speaker 1: to your point, the Fed is telegraphed to hike this year,
Speaker 1: and the markets now pricing in May of this year,
Speaker 1: first hike, three hikes this year. It's really the endpoint
Speaker 1: and the piece of hikes after this year that the
Speaker 1: market is really underpricing what the fret is messaging. So
Speaker 1: either the markets calling the Fed's bluff that they won't
Speaker 1: be able to raise rates that much, or it's an
Speaker 1: idea of a policy mistake that they slow the economy
Speaker 1: down and therefore they will either have to cut rates
Speaker 1: or not be able to raise rates. So, you know,
Speaker 1: I think they've been able to telegraph the near term,
Speaker 1: but it's really how much are they going to raise rates?
Speaker 1: How much are they gonna hike next year and the
Speaker 1: year after, And this is where I think there is
Speaker 1: uncertainty both from the economic out look as well as
Speaker 1: the FED reaction function. We're going to have new FED governors,
Speaker 1: three new FED governors most likely getting added to the
Speaker 1: voting members this year, and that could also shift the
Speaker 1: dynamic into next year. So that's why I think the
Speaker 1: market is has a disconnect with what the FED is communicating.
Speaker 1: When you think about some of the near term policies,
Speaker 1: how much are you thinking about a move in March
Speaker 1: if March is a live meeting or are we looking
Speaker 1: at a federal reserve with a very very clear distinction
Speaker 1: between ending the taper and then a timeline before that
Speaker 1: we get to the right height. So before the Army
Speaker 1: cron surge, I was thinking March could be a live
Speaker 1: meeting because they're already communicated the end of tapering and
Speaker 1: they could turn around and hike right away because they
Speaker 1: have very clear um, you know, conditions that have to
Speaker 1: be meant to hike. I would say, with the Army
Speaker 1: cron surge, and you know we are asking frictions in
Speaker 1: the travel industry, in leisure, I would argue service consumption
Speaker 1: is going to be a bit slow at least to
Speaker 1: start the year off. I think the FED, or or
Speaker 1: our view is that that March meeting is not really live,
Speaker 1: that the FED will want to retain optionality, flexibility, stress,
Speaker 1: on uncertainty and therefore just wait for the data after
Speaker 1: the omicron spike is behind us in the US, which
Speaker 1: is probably only by the end of the first quarter
Speaker 1: for the country, so which is why we think it's
Speaker 1: more in the second quarter that they can evaluate how
Speaker 1: much did domicron impact growth and whether their conditions to hike,
Speaker 1: which is both inflation and on the labor market, whether
Speaker 1: those are met. So that's why we're looking for the
Speaker 1: first hike only in June. Um But I would say
Speaker 1: that it's really a function on of how the economy
Speaker 1: shows down. All right, prea, thank you so much for
Speaker 1: joining us yet again, Pa Miserable, Managing director and Global
Speaker 1: head of rate Strategy at t D Securities. Otherwise on
Speaker 1: as Toronto Dominion. Did you know that I did? I
Speaker 1: did know that. Okay, there shortening up these names, trying
Speaker 1: to get a little bit cuter, I guess. But teacher
Speaker 1: Curities there premus record. Well, we've got markets at or
Speaker 1: near all time high. So when I was in my
Speaker 1: investment banking days, I would just tailor pick up the
Speaker 1: phone and call my clients and say, Hey, your stocks
Speaker 1: in an all time high. Let's go issue some stock.
Speaker 1: How how creative was that? How was that? Is that
Speaker 1: adding value or not? You know so? But the question
Speaker 1: is and a lot of those phone calls were made
Speaker 1: in one and the question is what do we do
Speaker 1: here in two? Um, let's bring in our next guess
Speaker 1: he's got some thoughts here he's going to share with us.
Speaker 1: Greg Flasnik, CEO of m Z North America. Greg, thanks
Speaker 1: so much for joining us here again. A good, great,
Speaker 1: slash really lucrative year for I p O slash spank
Speaker 1: spack bankers in twenty one, how about two? Yeah? You know,
Speaker 1: I think you know, two thousand twenty one was a
Speaker 1: record year for I p O s And I think
Speaker 1: if you look back at the beginning twenty one, you know,
Speaker 1: the start of COVID vaccines were rolling out, at global
Speaker 1: rebound of economies, We've seen a lot of liquidity accelerated
Speaker 1: by government stimulus and and all of this has resulted
Speaker 1: in quite a bit of optimism for the global IPO
Speaker 1: market um with with investor sentiment at peak UM. But
Speaker 1: I think if you look at you know, the next year,
Speaker 1: the year where now I guess two thousand twenty two, Um,
Speaker 1: you know, I feel that that momentum should continue at
Speaker 1: least into the first quarter of twenty two. I think
Speaker 1: that the spack vehicle is is um a great way
Speaker 1: of our companies to go public, and I think it's
Speaker 1: something that's here to stay. It certainly doesn't have the
Speaker 1: kind of risk that investors perceived, you know, maybe ten
Speaker 1: years ago. UM. And I think you know, if you
Speaker 1: if you look at the back market in twenty one,
Speaker 1: there was a lot of this bad of celebrities back sponsors, right,
Speaker 1: So I think you're gonna see less of this um
Speaker 1: and more from the serial spack sponsors sponsors eventually, but
Speaker 1: in the near term pullback from the serial spack sponsors,
Speaker 1: allowing what's already in the market. They're they're waiting for
Speaker 1: time to source and executed transaction UM as we are
Speaker 1: seeing a prolonged the spack process. So UM. You know
Speaker 1: what I mean by that is, you know, it could
Speaker 1: be completed in the little or three months, it's now
Speaker 1: taken closer to six months on average um UM. But
Speaker 1: but I think you know, for I p O candidates,
Speaker 1: undoubtedly they're up against some higher market volatility and and
Speaker 1: I just think it's important to remain flexible with with
Speaker 1: companies capital raising plans um in the event in I
Speaker 1: p O timeline is the way due to a shift
Speaker 1: in market conditions. But bottom line, I think high valuations
Speaker 1: and market liquidity are going to keep the I p
Speaker 1: O market hop as um we worked in the two
Speaker 1: twenty two and as Paul mentioned, you know, good for
Speaker 1: these companies taking advantage of some of these high valuations,
Speaker 1: but for investors maybe not so much. I'm taking a
Speaker 1: look at our spack index in our I p O
Speaker 1: index both ridden down. We have a speck index we
Speaker 1: do it is the I p O X Stack Index.
Speaker 1: Very cool. Spack index go on the terminal. Those were
Speaker 1: down last year ten relative to the SMP which is up.
Speaker 1: So how do investors start to perhaps maybe differentiate or
Speaker 1: start to be more discerning with what stacks or what
Speaker 1: I p O s they should be in. That's right,
Speaker 1: and I think there there was a time where, you know,
Speaker 1: we saw that again the the investor sentiment, the rise
Speaker 1: of the retail investor, where you know, in my business,
Speaker 1: I saw you know, people just basically buying anything that
Speaker 1: was an I p O or anything that was back,
Speaker 1: and certainly that is in a winning strategy. So I
Speaker 1: think just just having discipline in your investment criteria and
Speaker 1: deciding kind of what you know, really what you know,
Speaker 1: what is meaningful to you, and what you think ultimately
Speaker 1: would work. But um, you know, there is going to
Speaker 1: be a lot of annoys. There's always going to be
Speaker 1: winners and losers. And I think, just especially as it
Speaker 1: were ways to the retail investor, typically we see the
Speaker 1: sort of work best where people kind of have some
Speaker 1: sort of uh, I guess relation to the company about
Speaker 1: going public. I mean, what does it do for me?
Speaker 1: Why can I relate to this? Hey, Greg, thanks so
Speaker 1: much for joining us. I really appreciated getting your thoughts
Speaker 1: here on the new issue market. I p o S
Speaker 1: SPACs markets all time high. I'd be making a phone
Speaker 1: call to my clients saying, let's push some stock out
Speaker 1: the dork. Greg Lasnick, CEO of m Z North America
Speaker 1: looking at Tesla today to stocks up over ten it
Speaker 1: sounds like they're actually or looks like they're actually pretty
Speaker 1: good at making this, making these cars, that it's not
Speaker 1: just a tech story anymore. But let's bring in Dan
Speaker 1: Eys because he's been very bullish on Tesla and Tech
Speaker 1: and he's been very right. Dan Eyes, managing director and
Speaker 1: senior equity analysts for web Bush Securities, also a product
Speaker 1: of Happy Valley. Uh Dan, thanks so much for joining
Speaker 1: us here. So it turns out Tesla was how to
Speaker 1: make a lot of cars, don't they And they know
Speaker 1: how to make them despite the chip shortage. I think
Speaker 1: that Paul I didn't. That's the big day. I mean,
Speaker 1: the chip shortage probably took thirty thirty five cars off
Speaker 1: the quarter, So you start to add those, you're looking
Speaker 1: at something close to three and did this was it
Speaker 1: was a trophy keys quarter for Tessa in terms of
Speaker 1: what we're seeing demand and a lot of it's China.
Speaker 1: I mean, we think China loans worth about five hundred
Speaker 1: dollars per shared of the story in terms of everything
Speaker 1: we're seeing going in two thousand twenty two. Interesting when
Speaker 1: we talk about this, where is Tesla relative to some
Speaker 1: of the other competitors, Because you've talked a lot about
Speaker 1: some of the other big tech companies coming in maybe
Speaker 1: being able to compete, But who is a Tesla competitor
Speaker 1: at this point? Yeah, I mean tell it's a great
Speaker 1: question because the competition now is starting to expand, not
Speaker 1: just some auto players, but even technologies and We expect
Speaker 1: Apple to get into the e V game over the
Speaker 1: next few years. I think Amazon, Google and others because
Speaker 1: it's a five trillion dollar green tidalwing. But when you
Speaker 1: look at the core competitors or Tesla, it's really Ford
Speaker 1: GM in the US, and then of course VW and
Speaker 1: Europe and in China you've got Neo x Pinion others.
Speaker 1: But it's important because you look at the scale that
Speaker 1: they have, it's unmatched, and I think that's something that
Speaker 1: still is underappreciated by the street. Once you get Berlin
Speaker 1: in Austin and they'll have capacity of over two million
Speaker 1: units going in two thousand twenty two, Dan, how do
Speaker 1: you think Tesla wants to position itself from a marketing perspective?
Speaker 1: Once we have the vw is and the Fords and
Speaker 1: the gms, you know, with a full array of e vs,
Speaker 1: how does Tesla want to position themselves in this marketplace? Yeah,
Speaker 1: I mean they definitely were on the high end as
Speaker 1: we saw the sn X. But but but the core
Speaker 1: winchpin to Tesla growth is going to be in that
Speaker 1: forty to fifty k range with probably additional software on
Speaker 1: on top of that. It's a cachet that they've built,
Speaker 1: remember without any formal marketing, because Tessa has become synonymous
Speaker 1: with EVS and a lot of that is related to
Speaker 1: Musk and everything that him and the team have built.
Speaker 1: And no doubt competition is going to significantly increase. But
Speaker 1: what's important today, I mean E d S is still
Speaker 1: only three automobiles in the world when that goes at
Speaker 1: ten by two thousand and for test of the big
Speaker 1: opportunity now they can get card into consumer's hands. That
Speaker 1: is ultimately the key, and it's something where the average
Speaker 1: consumer when they look at EVS, they're looking why should
Speaker 1: I not buy a Tesla? And I think that's something
Speaker 1: they put themselves into the same situation as the Apple
Speaker 1: when it comes to iPhone. Are you talking about the
Speaker 1: US consumer or increasingly a Chinese consumer, Well, the China
Speaker 1: is the winchpin. That's the key to the bull thesis.
Speaker 1: I mean China, we can that would be about four
Speaker 1: percent plus deliveries for testing two thousand twenty two. And
Speaker 1: that's why China is so key because also the profitability
Speaker 1: on these vehicles. Now test is a profitable story. They
Speaker 1: can have thirty dollars earnings, how about two? Wow? That
Speaker 1: is China driven. And if it sounds familiar because that
Speaker 1: company and Cupertino, what's been a key part of their growth.
Speaker 1: It's China for Apple. So you look at what Apple
Speaker 1: and Teslam and Musk is really taking a playbook out
Speaker 1: of Apple. Dan, I'm looking at the Bloomberg Ternel right now.
Speaker 1: They a and our function an analyst recommendation. Of course,
Speaker 1: we have an apperform rating on the stock and I
Speaker 1: see a fourteen hundred price target. What's the catalyst to
Speaker 1: get us from you know, eleven sixty six here too? Well,
Speaker 1: I think the key catalyst is as we get into
Speaker 1: the earnings season over the next call at three or
Speaker 1: four weeks, it's really must talk about chip shortage because
Speaker 1: if chip short just starting to moderate, which we believe
Speaker 1: it is, then all of a Sudden's street numbers and
Speaker 1: they could go up two h thousand units, you know
Speaker 1: for the year. That means profitability could be up thirty
Speaker 1: relative to what the streets modeling. That's a cattle. The
Speaker 1: second catalyst is around battery technology. That's a big part
Speaker 1: of their mood. I think improvements they are specifically on
Speaker 1: costs side or significant to the Tesla story, and I
Speaker 1: think those are some of the catalyst. We'll have some
Speaker 1: white knuckle periods that we always do, and there's always
Speaker 1: gonna be some side circuits shows. But if you look
Speaker 1: at the fundamentals, that's really what I think stood out
Speaker 1: When you look at what Tesla din is que for.
Speaker 1: Take us outside Tesla as well other big tech because
Speaker 1: you cover it all. What are you looking for to
Speaker 1: be one of the best performers or a better stock
Speaker 1: from a fundamental basis as we head into this year. Yeah,
Speaker 1: I mean, we could talk about fed raising rates, risk
Speaker 1: off valuation until it blue in the face, but it
Speaker 1: comes down to the dynamic streets, underestimating his growth. And
Speaker 1: know why that growth I think is in software and
Speaker 1: cyber security. You look at names of software besides just Microsoft,
Speaker 1: which you know, I think will be a three trillion
Speaker 1: dollar mark AP two thousand twenty two. You know, I
Speaker 1: look at some of these names in terms of cyber
Speaker 1: secure names like g Scale or Tenable, pow Out though
Speaker 1: among others. I think you also gonna have a lot
Speaker 1: more m n A with the cloud cyber security, and
Speaker 1: that's why you can't lump them all into the same bucket.
Speaker 1: Work from home e commerce, you'll start to see some
Speaker 1: of the frost come on. When you look at Cloud,
Speaker 1: cyber Security five and some of the core names like Apple,
Speaker 1: the spending is actually accelerating, not decelert And that's the
Speaker 1: important Dan. You mentioned Coupertino, So I gotta ask you
Speaker 1: for your call for Apple. Look, I mean for Apple,
Speaker 1: it's right now we're about twelve million demand outstrip and
Speaker 1: supply and units. Because of the shortage that that holds
Speaker 1: me alongates the March in June growth that will see
Speaker 1: for Apple. I still think this is an iPhone cycle.
Speaker 1: Underest my aby the street it would be too forty
Speaker 1: million units for the year. And then I think they
Speaker 1: finally released Apple Glass by the summer that could add
Speaker 1: twenty hours per share the air of your headset. And
Speaker 1: I think Apples one where it's all about monetization, and
Speaker 1: we think the services business saloon is worth one point
Speaker 1: five trillion. That continues to be the rerating. Like we've said, Paul,
Speaker 1: they hate, They hated a trillion, despised two trillions, and
Speaker 1: they're just screaming at three trillion. What caters will hate
Speaker 1: it is what it is, all right, Dan, What we
Speaker 1: love about you, consistent and with great conviction on your calls.
Speaker 1: We appreciate that and appreciate getting your time. Dan ives
Speaker 1: he's a managing director senior equity analysts at Wedbush Security,
Speaker 1: is proud alumnus of the Penn State University. I wrote
Speaker 1: a lot of tuition checks the pen Penn State University,
Speaker 1: so I have a particular affinity, uh for there. But
Speaker 1: Dan has been not just really good here on this
Speaker 1: Tesla story. Uh, and it's really been amazing to watch it.
Speaker 1: Just the tech analysts get it. The auto analysts by
Speaker 1: and large have not historically but really shown that they
Speaker 1: can make a lot of cars there. Thanks for listening
Speaker 1: to the Bloomberg Markets podcast. You can subscribe and listen
Speaker 1: to interviews with Apple Podcasts or whatever podcast platform you prefer.
Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller three.
Speaker 1: Put on fall Sweeney I'm on Twitter at pt Sweeney.
Speaker 1: Before the podcast. You can always catch us worldwide at
Speaker 1: Bloomberg Radio.