Speaker 1: Hi, and welcome to What Goes Up a weekly markets podcast.
Speaker 1: UM Voldana hire across Asset Report at Bloomberg, and I'm
Speaker 1: Crystal Kim, Crypto reporter at Bloomberg, filling in for Mike
Speaker 1: Reagan and this week on the show. Wall Street forecasters
Speaker 1: have been saying all year that a slowdown in the
Speaker 1: bullmarket will be in the cards thanks to any number
Speaker 1: of reasons. The average projection for the SMP at the
Speaker 1: end of represents a mere three percent advance from current levels.
Speaker 1: We'll get into all of that with a first time guest,
Speaker 1: but first, Crystal, I want to welcome you to the show.
Speaker 1: Thanks so much for joining us, Thank you, thank you
Speaker 1: a lot to be grateful for joining you on this podcast.
Speaker 1: The endless number of pies waiting to be eaten, and
Speaker 1: of course what will be served up hot at Thanksgiving
Speaker 1: UM this year is the conversation. From what I read,
Speaker 1: seems like the talk around the Turkey will be crypto.
Speaker 1: UM Macy's isn'to n f t S, so is the
Speaker 1: NFL and Odell Beckham Jr. Martha Stewart is into it.
Speaker 1: Quentin Tarantino is into it. N f d s have
Speaker 1: become an all encompassing subject and it'll be fun to discuss.
Speaker 1: Maybe we can get into all of that with our
Speaker 1: guests as well. I want to bring in Candice Banks,
Speaker 1: and she's a portfolio manager of Global asset Allocation at
Speaker 1: Fierra Capital and Nnchial. Candice, thanks so much for joining
Speaker 1: us this week. Hey, thanks for having me. Just to
Speaker 1: start out, I'm hoping you can just lay out your
Speaker 1: strategy for us, what sectors and areas of the market
Speaker 1: you're favoring right now, and then how you're starting to
Speaker 1: think about two as the year closes out. Yeah. Absolutely.
Speaker 1: While our base case scenario is calling for a reflationary recovery,
Speaker 1: this is essentially an extension of the post pandemic recovery
Speaker 1: that inevitably results in appear an extended period of strong
Speaker 1: and above trend global growth. Now in our base case UM,
Speaker 1: this visibility of the cycle is extended UM, given that
Speaker 1: policymakers take a very measured and gradual approach to policy
Speaker 1: normalization UM and essentially supporting the economy going forward. So
Speaker 1: this is very much a supportive backdrop for financial markets
Speaker 1: in particularly stocks, over the next twelve to eighteen months UM. Obviously,
Speaker 1: you know there's been talk about the global economy um
Speaker 1: you know, moderating here, but the fact of the matter
Speaker 1: is that it has peaked at a very elevated levels.
Speaker 1: And um, you know, like I said, we'll remain strong
Speaker 1: and above trend um without the fear of you know,
Speaker 1: premature and aggressive policy normalization that would derail that recovery
Speaker 1: going forward. So we remain quite constructive on the global
Speaker 1: economic outlook. UM. We think the devish reaction function from
Speaker 1: central banks and the increased tolerance for higher inflation will
Speaker 1: allow for that more cautious and gradual approach to policy
Speaker 1: normalization in the coming twelve eighteen months, and together this
Speaker 1: will um again create um, you know, a favorable backdrop
Speaker 1: for stocks versus bond. Now that being said, we do
Speaker 1: expect a more challenging environment for equities in the next
Speaker 1: in the coming year. We've obviously come off a very
Speaker 1: strong period of UM out performance and and very robust
Speaker 1: results in the global equity landscape since the lows of
Speaker 1: March twenty but also here in alone, and our sense
Speaker 1: is that you know, there's fewer obvious catalysts that will
Speaker 1: push equity markets significantly higher from here, and that the
Speaker 1: fundamental tail winds that supported equity markets in the last
Speaker 1: eighteen nineteen months have deteriorated somewhat, and as a result,
Speaker 1: you know, while we don't expect a recession or a
Speaker 1: bear market for that matter, UM, we do expect more
Speaker 1: muted and volatile equity market returns going forward after the
Speaker 1: extended stretch of gained since those UM, those march loads.
Speaker 1: So here are a couple of factors to think about UM.
Speaker 1: You know, given um our outlook I mentioned UM, you know,
Speaker 1: the fundamental backdrop, and our senses that when we go
Speaker 1: down the list, the downside risks are beginning to outweigh
Speaker 1: the potential for positive surprise, particularly given that much of
Speaker 1: the good news UH pertaining to the macro backdrop has
Speaker 1: likely been priced in at these elevated levels, and this,
Speaker 1: in our view, could leave some scope for more volatility
Speaker 1: disappointment UM unwanted volatility UM should something go awry. So
Speaker 1: on the fundamental friend I mentioned, the strong recovery earnings
Speaker 1: have been soaring, but our senses that you know, the
Speaker 1: strong recoveries have likely already been discounted. And this comes
Speaker 1: on the heels of an vironment of rising input prices
Speaker 1: inflation UM rising wages UM, as the job market continues
Speaker 1: to recover. All of this has the potential to squeeze
Speaker 1: profit margins. So some vulnerability on the profit front, and
Speaker 1: I think most critically is on the policy front. UM.
Speaker 1: And we've passed the point of peak stimulus, and this
Speaker 1: is going to UM create some uncertainty and some unwanted
Speaker 1: volatility as policymakers transition from that extremely accommodative stance towards
Speaker 1: something less accommodative and incrementally so and while we're not
Speaker 1: moving to restrictive policy UM or even neutral UH for
Speaker 1: you know, for that matter, in the next year, UM,
Speaker 1: that shift from extreme accommodation to something less supportive. Typically
Speaker 1: UM does inject a little bit of volatility in the market.
Speaker 1: So taken together, UM, you know those factors, whether it's
Speaker 1: buoyant earnings expectations, intensifying pressure on margins UM and limited
Speaker 1: go for further pe expansion. UM. You know basically has
Speaker 1: UM you know, UH given us them, you know, an
Speaker 1: opportunity to take some profits and adopt a more neutral
Speaker 1: stance on equity market for for the time being. Kennessy said,
Speaker 1: so many great things, and I want to get into
Speaker 1: like every element of what you've said, but I want
Speaker 1: to start at the top with UM, with your stance UM,
Speaker 1: your economic base case of a reflationary recovery. I was
Speaker 1: wondering if this week's market events thus far affirm your view. Namely,
Speaker 1: I'm referencing the largely anticipated continuity and FED leadership and
Speaker 1: thus the continuity of the Fed's posture. Yeah. Absolutely, I
Speaker 1: think the the outcome of the nomination process has reinforced
Speaker 1: that base case for reflationary recovery. Essentially, like you said, UM,
Speaker 1: you know, given that you know Paleal is you know,
Speaker 1: back in the chair position for another four years. UM.
Speaker 1: Really for us, UM, you know, reinforces the UM status
Speaker 1: quo UM from that perspective. So a little bit more
Speaker 1: visibility on on that front. So again consistent with UM,
Speaker 1: you know, the narrative where policymakers do adopt or UM
Speaker 1: you know, take that more pragmatic approach to policy normalization.
Speaker 1: So encouraging in that respect. And Kenness, I was hoping
Speaker 1: you would sort of walk us through your thinking about
Speaker 1: some areas of international markets that you might be preferring
Speaker 1: right now. In particular, I think in one of your
Speaker 1: recent notes you said you like Canadian stocks and Japanese stocks,
Speaker 1: if you wouldn't mind just going over how you're thinking
Speaker 1: about things internationally. Yeah, So, while we're neutral overall from
Speaker 1: an equity perspective, we do see particular pockets of opportunity
Speaker 1: in UM, you know, certain corners of the market, namely
Speaker 1: the a cyclical value space. So as we all know,
Speaker 1: you know, the growth defensive stocks have done extremely well
Speaker 1: UM with interest rates you know, uh tumbling to rock
Speaker 1: bottom levels. This has basically boosted the valuations of these
Speaker 1: growth talk growth stocks, particularly in the tech space UM
Speaker 1: over the last UM you know, eighteen or nineteen months,
Speaker 1: and a lot of that was a result of all
Speaker 1: of the liquidity that was being injected into the market
Speaker 1: by central banks UM, you know, back during the depths
Speaker 1: of the pandemic. Now, with earnings UM acting as more
Speaker 1: of a driver, the global economy is on solid ground.
Speaker 1: UM inflation obviously accelerating interest rates are rising in response,
Speaker 1: we expect UM that rotation from the growth towards the
Speaker 1: value space to take hold, and this is where we
Speaker 1: see an opportunity going forward. From a valuation perspective alone,
Speaker 1: UM you know, looks like a favorable backdrop for these UM,
Speaker 1: you know, cyclical value corner corners of the markets. When
Speaker 1: you think about UM, steeper yield curves boosting financial stocks,
Speaker 1: higher commodity prices across the board, boosting the resource sectors. UM.
Speaker 1: This essentially UM underscores our preference for Canadian stocks given
Speaker 1: the composition of the Canadian stock market, which is about
Speaker 1: two thirds of these value oriented cyclical sectors of the market.
Speaker 1: So that's how we play that UM you know, cyclical
Speaker 1: value opportunity within the global equity space. I thought it
Speaker 1: was interesting that in your base case for stocks next year,
Speaker 1: for US large caps specifically, you forecast minus twelve point
Speaker 1: five UM UH, Canadian large cap is does better than that,
Speaker 1: and I wondered if that bakes in the sumption that
Speaker 1: value does better than growth in both regions. So the
Speaker 1: matrix that you're referring to in the expected returns are
Speaker 1: all in Canadian dollars. So the reason that sp expectation
Speaker 1: looks so dire is because we expect the US dollar
Speaker 1: to weekend in the next year in the Canadian dollar
Speaker 1: to strength, and so that's actually the currency impact you're
Speaker 1: seeing there when it comes to the spire though UM
Speaker 1: we have exceeded our target. We have a forty target,
Speaker 1: so the total return is still negative or the total
Speaker 1: expected return, and we still expect some modest upside in
Speaker 1: Canadian stock. So it's a relative play between Canada and
Speaker 1: the US. And like I said, from a valuation perspective,
Speaker 1: the Canadian market has rarely traded this um at this
Speaker 1: size of a discount to the US, and given that
Speaker 1: composition and the value oriented bias of the T s X,
Speaker 1: we think this is UM you know, offering more compelling
Speaker 1: opportunities for equity upside going forward. And then as Crystal mentioned,
Speaker 1: we did have the Powell news earlier this week, but
Speaker 1: the other news that's sort of also happening in the
Speaker 1: background and happening internationally is the rise in COVID cases,
Speaker 1: especially in Europe and some of the headlines that we're
Speaker 1: seeing there. So I'm wondering how you're thinking about that.
Speaker 1: I know JP Morgan had a NOE doubt earlier this
Speaker 1: week saying that this new wave is unlikely to be
Speaker 1: a material problem for stocks, So how are you thinking
Speaker 1: about it? Yes, so I think it adds to that
Speaker 1: narrative where the risks are mounting at a time when
Speaker 1: you know the markets are largely pricing a lot of
Speaker 1: good news UM. While we don't think that these subsequent
Speaker 1: waves of the coronavirus will derail the economic expansion UM,
Speaker 1: it is something that we need to monitor because of
Speaker 1: course it could UM stall the recovery, like I said,
Speaker 1: but not to derail it all together. Whether it's given
Speaker 1: the high vaccination rates, the UM the fact that you know, hospitalizations,
Speaker 1: mortalities have UM remained very subdued even in the UM
Speaker 1: in the wake of these subsequent waves just tells us
Speaker 1: that we're not likely to see that recession scenario even
Speaker 1: in the wake of more stringent countermeasures. But that being said,
Speaker 1: it is something that I think you'll see more UM
Speaker 1: you know, from a financial market volatility perspective. Again, just
Speaker 1: something for investors to contemplate UM and like I said,
Speaker 1: the potential for whether it's you know, you know, some
Speaker 1: lockdowns or UM you know, fear of UM you know,
Speaker 1: traveling or going out again. If you get some of
Speaker 1: that UM you know that M deterioration and confidence that
Speaker 1: could potentially UH damp in growth kind of similar to
Speaker 1: what we saw in the third quarter UM of this year.
Speaker 1: But nonetheless we don't expect that to derail or to
Speaker 1: impact our base case scenario. But I think, like I said,
Speaker 1: you'll see it more through UM the lens of the
Speaker 1: financial markets and volatility. UM, you know, as these headlines
Speaker 1: UM you know, hit the hit the screen. Going back
Speaker 1: to your base case of a reflationary recovery, I thought
Speaker 1: it interesting that your firm put it at a fifty
Speaker 1: probability if I have that right, UM, what would have
Speaker 1: to happen to give you all greater than a coin
Speaker 1: toss conviction? UM about a reflationary recovery? Yeah, So the
Speaker 1: difference between our top two scenarios really hinges on the
Speaker 1: policymaker response. So in that reflationary recovery scenario, we're essentially
Speaker 1: assuming that that UM you know, that devish bias from
Speaker 1: central banks, and that tolerant for inflation to run above
Speaker 1: target for an extended period of time UM allows for
Speaker 1: a slower and more gradual approach policy normalization. And like
Speaker 1: I said, that's essentially UM you know what has reinforced
Speaker 1: our strong outlook for the global economy and of course
Speaker 1: UM you know financial markets broadly. Now, the risk to
Speaker 1: that scenario is if policymakers basically step in prematurely UM
Speaker 1: start to panic given some of these elevated inflation numbers
Speaker 1: that we've been seeing, and start to tighten monetary policy,
Speaker 1: in our view, something that would be prematurely. This would
Speaker 1: in in response, likely dampen the recovery, if not derail
Speaker 1: it all together. And that's I think UM the policy
Speaker 1: error that people should be thinking about. You know, you've
Speaker 1: I've seen a number of headlines about the policy air
Speaker 1: being allowing inflation to run at these levels without stepping in.
Speaker 1: I think the policy air at this point would be
Speaker 1: stepping in prematurely and derailing the recovery at a time
Speaker 1: when it is still UM vulnerable. What happens to US
Speaker 1: stocks if that happens, stock mark is in general UM
Speaker 1: would sell off in that in that UM stag inflationary scenario.
Speaker 1: So that's what about that second scenario that you're referring
Speaker 1: to as stag inflation. And in that scenario, UM, it's
Speaker 1: UM an unfortunate outcome not only for stocks but also
Speaker 1: for bonds because of course interest rates would be rising
Speaker 1: quite aggressively as well. So UM very much a risky
Speaker 1: scenario for financial markets in general. And it all really
Speaker 1: hinges on that policy response, which is very difficult to forecast,
Speaker 1: to navigate. UM. You know, you see a lot of
Speaker 1: different headlines, many different policymakers speaking, um, you know, some
Speaker 1: more hawkish than others. That's why those probabilities are so close,
Speaker 1: because there is very much, um, a lot of uncertainty
Speaker 1: as to how this will all shake out in the
Speaker 1: next twelve the eighteen months. I'm glad you mentioned that,
Speaker 1: but you did steal my question because I was going
Speaker 1: to ask you if you and your team have projections
Speaker 1: for what we can expect for interest rate hikes from
Speaker 1: the Fed. I know. John Author's a Bloomberg opinion had
Speaker 1: a column this week saying it's a little bit perplexing
Speaker 1: the way the markets reacted to the Power renomination because
Speaker 1: Brainard actually tends to vote in the same way the
Speaker 1: Pole does. So how should we be thinking about that? Yeah,
Speaker 1: when it comes to the trajectory for UM FED funds,
Speaker 1: we are much more dubbish than the market. UM. Following
Speaker 1: the UM renomination of Chair Powell, markets are pricing I believe,
Speaker 1: close to five rate hikes over um, you know, three,
Speaker 1: which we think is overdone. Um. Given the you know,
Speaker 1: given again the narrative where policymakers UM will take that
Speaker 1: cautious approach. UM, we expect UM only one rate hike
Speaker 1: from the Fed in two obviously in the back half,
Speaker 1: because of course by the mid midway through UM our
Speaker 1: senses that in play shin those that acceleration will have receded.
Speaker 1: And while we still expect inflation to be sustainably above target,
Speaker 1: we think the focus then we'll shift to the labor market,
Speaker 1: and that's where there's still some significant flack. And that's
Speaker 1: also another precondition for policymakers to start lifting rates UM,
Speaker 1: you know, from these rock bottom levels. So again, you know,
Speaker 1: when you bring in that bias to allow UM inflation
Speaker 1: to run at these levels for UM longer than may
Speaker 1: have typically been the case. After ten years of underperforming
Speaker 1: the inflation target, our senses that policy makers will be
Speaker 1: in a position to take a slow approach to policy normalization.
Speaker 1: And therefore, you know, my um, my interpretation is that
Speaker 1: the markets UM are leaning a little bit too hawkish
Speaker 1: and I've gotten a little bit ahead of themselves from
Speaker 1: a policy's perspective, and we see that here in in
Speaker 1: the Canadian market as well as similar a similar narrative.
Speaker 1: All Right, it seemed to me that earlier this week, Uh,
Speaker 1: and gold was backing off and the hedges were coming off,
Speaker 1: and and I wanted to ask you what are good
Speaker 1: inflation hedges these days? I mean, I would say gold
Speaker 1: actually broke out of its down trend here just in
Speaker 1: the last few weeks. I mean, it's been a tough
Speaker 1: year for gold in and you know, investors are starting
Speaker 1: to threat about that inflation outlook. And in the last
Speaker 1: few weeks we've seen gold turn UM decidedly higher UM
Speaker 1: in response as investors seek that hedge in an inflationary environment.
Speaker 1: Went again. UM. You know, if we're right and policymakers
Speaker 1: take a very gradual and you know, measured approach to
Speaker 1: policy normalization, suggests that real interest rates are going to
Speaker 1: remain in negative terrain. And this is obviously also a
Speaker 1: tail wind for gold. UM. That being said our view
Speaker 1: and at Fierira, UM, you know, we feel that real
Speaker 1: assets UM, you know, such as real estate, agriculture, infrastructure,
Speaker 1: for vibe UM the best hedge to inflation over the
Speaker 1: long term. UM. You know, we expect inflation will remain
Speaker 1: above two percent target not only in the next twelve
Speaker 1: the eighteen months, but over the next three or four years.
Speaker 1: As well. So that's just really um, you know, reinforces
Speaker 1: the need for real assets in a well balanced portfolio.
Speaker 1: It's interesting you mentioned those things because I've been I
Speaker 1: had actually been working on a story for Business Week
Speaker 1: about some of the best inflation hedges that people had
Speaker 1: mentioned farmland to me, and they mentioned cattle and things
Speaker 1: like that. Some of these things I frankly had never
Speaker 1: heard of as inflation hedges before. And then Crystal, I
Speaker 1: know you and I haven't talked too much about your
Speaker 1: new beat yet, but you do cover crypto and bitcoin,
Speaker 1: and cryptocurrencies come up quite a bit in this conversation.
Speaker 1: I don't know, Candice, if a lot of your clients
Speaker 1: are asking you about that as well. It just seems
Speaker 1: like this big hot topic these days. Yeah, it's definitely
Speaker 1: something we're seeing more in the headlines these days. From
Speaker 1: an ass allocation perspective, we are not, um, you know,
Speaker 1: deploying capital towards the SASA class right now. Lots of
Speaker 1: speculation built around that and you know, very little in
Speaker 1: the way of tangible value. So I think, um, you know,
Speaker 1: from our from our perspective, UM, you know, not something
Speaker 1: that we're looking at, UM, you know, proactively at this point,
Speaker 1: I hear you. I mean, though, if we're tapped out
Speaker 1: in terms of return or yield in traditional places, we've
Speaker 1: got to find them somewhere else. So if not in crypto,
Speaker 1: where can we go? That is a fantastic question. And
Speaker 1: you know, I've talked about a very challenging backdrop for
Speaker 1: both stocks and bonds in the coming year. Um, as
Speaker 1: I already mentioned, you know, while we don't expect the
Speaker 1: bearer market or recession for that matter, the easy money
Speaker 1: has been made in global stock markets, so those similar
Speaker 1: double digit returns are gonna be tough to come by
Speaker 1: going forward. At the same time, given our interest right forecast,
Speaker 1: particularly at the long end of the curve, you know,
Speaker 1: the expected returns in traditional bonds, which are supposed to
Speaker 1: be this you know, the stability and the income generating
Speaker 1: aspect of the of a balanced portfolio. Um you know,
Speaker 1: we're expecting negative returns and we've already seen minus five
Speaker 1: percent here in one alone, and expect something similar for two.
Speaker 1: So with that, you know, given the you know, unfavorable
Speaker 1: return prospects and those traditional bond and equity as a classes,
Speaker 1: this really, you know, reinforces the need to diversify a
Speaker 1: portfolio into the private alternative space. So this is where
Speaker 1: those um real asset strategies come into play, whether it's
Speaker 1: real estate, agriculture, infrastructure, UM, private lending. Obviously you're getting
Speaker 1: that nice income stream and the stability um of fixed
Speaker 1: income without the well like the negative return expectation and
Speaker 1: that that we're expecting for traditional bonds given our expectation
Speaker 1: for interest. Right, So I think these asset these private alternative,
Speaker 1: non traditional sources of income will uh provide a very
Speaker 1: important part in a well balanced portfolio from an income perspective, um,
Speaker 1: you know, without imploding the volatility of a well balanced portfolio.
Speaker 1: These are typically more stable strategies. But importantly they also
Speaker 1: have a low correlation to traditional asset classes, so in
Speaker 1: a well balanced portfolio, they would tend to reduce your
Speaker 1: overall portfolio risks. And I want to ask you one
Speaker 1: more question before we get into our weirdest thing. And
Speaker 1: as Crystal mentioned at the top of this show, there's
Speaker 1: a lot to talk about there in terms of Thanksgiving
Speaker 1: and Krypton, all these other things happening this week, But
Speaker 1: the one thing we really haven't talked about yet is
Speaker 1: the state of the consumer. I know, I get a
Speaker 1: lot of reports about holiday shopping trends. And then we
Speaker 1: also had Arnie from the you know, big box walmarts
Speaker 1: and targets and all of them have been passing cost
Speaker 1: increases onto the consumer and so on. So how much
Speaker 1: of everything is dependent on the state of the consumer
Speaker 1: and the well being of the consumer. Well, our senses
Speaker 1: that the consumer continues to drive the recovery and it's
Speaker 1: an instrumental source of you know, a strong economy, particularly
Speaker 1: in the in the US, but also here in Canada
Speaker 1: and globally as well. And the good news is that
Speaker 1: the consumer right now does have some ammunition to rising prices.
Speaker 1: You look at the abundance of savings um that have
Speaker 1: been stashed over the last you know, several months UM
Speaker 1: that are right for spending. As you know, the consumer
Speaker 1: goes out, resumes resumes those normal activities, whether it's taking
Speaker 1: a vacation or um you know, spending more money on
Speaker 1: the services side, going out to restaurants, etcetera. UM sour
Speaker 1: census that the consumer will continue to you know, be
Speaker 1: a driving force for the economy. At the same time,
Speaker 1: you know, the job market, in our view, will continue
Speaker 1: to improve wages will be um on the rise. Already
Speaker 1: in some parts of the market we're seeing some sizable
Speaker 1: wage games. So all of this taken together, Um, you know,
Speaker 1: reinforces are positive. Outlook for the back backdrop for consumption.
Speaker 1: Stand clear of the craziest things we saw in markets
Speaker 1: this week. And I know I asked both of you
Speaker 1: two come prepared with some of the craziest or weirdest
Speaker 1: things you saw in markets this week, and I feel
Speaker 1: like we've hinted at a bunch of them already. But Crystal,
Speaker 1: I feel like you have like a big list of
Speaker 1: things that you've been watching all week. I hope you
Speaker 1: I hope you proved me right. Yes, um, I mean
Speaker 1: it would be so easy to reach for the Volcano bond.
Speaker 1: That's the world's first sovereign bond that will build a
Speaker 1: bitcoin city. El Salvador plans to issue one billion dollars
Speaker 1: in tokenized USD denominated tenure bonds. But that's not my
Speaker 1: weird thing of the week. By weird thing of the
Speaker 1: week is this thing called the Constitution DOW that goes
Speaker 1: back to my crypto beat. This DOW, or a decentralized
Speaker 1: autonomous organization think of it basically as a club born
Speaker 1: on the Internet. It's the A O L chat room
Speaker 1: of the future, but it has an agenda. So the
Speaker 1: Constitution Now was a group of people who raised something
Speaker 1: like forty seven million dollars to buy a really old,
Speaker 1: really valuable physical copy of the Constitution spoiler alert. They
Speaker 1: failed pretty fantastically. The private individual that outbid them turned
Speaker 1: out to be none other than hedge fund billionaire Ken Griffin.
Speaker 1: But what was unusual to me. Maybe no one saw
Speaker 1: it this way, but to me, the Constitution Now effectively
Speaker 1: did a spack. They pulled some money to buy something.
Speaker 1: And in the Wall Street world, when a spack fails,
Speaker 1: too fail on the promise of I'm going to buy
Speaker 1: a thing, people are generally disappointed and want their money back. Um.
Speaker 1: But in crypto world, this Dow failed to do this
Speaker 1: thing they set out to do, and in the wake
Speaker 1: of this failure, it would seem they have greater support
Speaker 1: to do something else. And that's my unusual thing of
Speaker 1: the week. I love this and the analysis of all
Speaker 1: of this and comparing it's this acts. This is really good. Candice.
Speaker 1: I'm sorry, but this is like a really high bar.
Speaker 1: I feel like I was just going to say, Crystal,
Speaker 1: that you had the bar extremely high, and I don't
Speaker 1: think I can match that. I've been sort of brainstorming
Speaker 1: here as we're as I was listening to your fascinating
Speaker 1: discovery there about some of the events uh this week,
Speaker 1: And of course I'm a boring strategist, so I just
Speaker 1: I think about the headlines that I've seen that sort
Speaker 1: of make me scratch my head a little bit, and HM,
Speaker 1: that's interesting. And UM, I think one of them, you know,
Speaker 1: sort of perplexing market responses that I've seen this week
Speaker 1: is the renomination or the outcome of the renomination of
Speaker 1: chair Powell. UM. I was quite surprised to see the
Speaker 1: markets respond in such a hawkish fashion, given that it's
Speaker 1: essentially suggesting status quo, um, you know, for for the
Speaker 1: FED going forward, and you know, by bringing Brainard up
Speaker 1: to vice chair. Um, you know, I you know it,
Speaker 1: it seems to me that that's going to add a
Speaker 1: more devish leaning biases at that vice chair position. So
Speaker 1: I was quite surprised to see the market adjust the
Speaker 1: way that it did following that announcement. UM, you know,
Speaker 1: looking at the rate hike expectations, I think, um, yeah,
Speaker 1: more than five rate hikes price now by the end
Speaker 1: of so that seems a little bit overdone given that
Speaker 1: status quo UM you know, situation at the Federal Reserve.
Speaker 1: And I think one more thing I point out, I know, ye,
Speaker 1: well last for one, but just something that's lingering in
Speaker 1: the in the background now is these um, you know,
Speaker 1: tensions that have been emerging between oil consumers and producers
Speaker 1: UM you know, obviously major consuming nations such as the US,
Speaker 1: but also in coordination with China, Japan, South Korea, India,
Speaker 1: UM all talking about releasing strategic reserves to get those
Speaker 1: oil prices UH down a little bit. But at the
Speaker 1: same time you've got Opec um you know, pushing back
Speaker 1: and even reportedly reconsidering um their upcoming supply increase. So
Speaker 1: that will be very interesting to to watch going forward.
Speaker 1: And I think we'll just um you know again, you know,
Speaker 1: inject a little bit more volatility into the crude markets
Speaker 1: after what's been a pretty strong rally. And the interesting
Speaker 1: thing to me about those headlines was just looking at
Speaker 1: the list of countries that the US is working with.
Speaker 1: So we have all these tensions with China and at
Speaker 1: the same time the US is working with China and
Speaker 1: Japan and suss Carea and so on on on making
Speaker 1: this happen. Yeah, no, it's a fully coordinated move, you know.
Speaker 1: And yeah, we'll have to see how everything um shakes out,
Speaker 1: but I think there could be um, you know, some
Speaker 1: volutility around those headlines here in the in the coming week. Well,
Speaker 1: my craziest thing also has to do with crypto, So
Speaker 1: we're really crypto heavy on weirdness things again this week.
Speaker 1: It's just it's so easy to find a lot of
Speaker 1: really interesting stuff there. But I was looking at the
Speaker 1: Crypto dot Com deal to rename the Staples Center in
Speaker 1: l A so that it bears the Crypto dot Com name,
Speaker 1: and it seems like that has actually already paid for
Speaker 1: itself in some ways, because the token for crypto dot
Speaker 1: com has surged something like fifty in the wake of
Speaker 1: that announcement, which is just, you know, it's there's just
Speaker 1: so many huge moves happening in the crypto space when
Speaker 1: it comes to some of these tokens and and some
Speaker 1: frankly that maybe we've never heard of before until they
Speaker 1: start making headlines. But I think Katie Grayfield put it best.
Speaker 1: She said, you know, this deal for the Staples Center
Speaker 1: to be renamed. It's a twenty year deal, and she said,
Speaker 1: I thought we were all supposed to be in the
Speaker 1: metaverse in twenty years, so it's it's really interesting to
Speaker 1: think about. But it's been really great to have you
Speaker 1: both on the show, and I'd love to have you
Speaker 1: back on in the future. Crystal, thank you so much
Speaker 1: for joining us. I know crypto is is your beat now,
Speaker 1: but you you do really well as a stock markets
Speaker 1: reported to Thank you. Thank you, Candice, thanks so much
Speaker 1: for joining us. Yeah, thank you so much for having
Speaker 1: me and for one upping me on the craziest Things
Speaker 1: of the week, both of you. Yours were good. Yours
Speaker 1: were really good too. Thanks for being on the show again.
Speaker 1: What goes up? We'll be back next week. Until then,
Speaker 1: you can find us on the Bloomberg Terminal website and
Speaker 1: app or wherever you get your podcasts. We'd love it
Speaker 1: if you took the time to rate and review the
Speaker 1: show on Apple Podcasts so more listeners can find us.
Speaker 1: And you can find us on Twitter follow me at
Speaker 1: Dana Hirich. Crystal Kim is at Crystal Kim with three ms.
Speaker 1: You can also follow Bloomer Podcasts at at podcast, and
Speaker 1: thank you to Charlie Pellett of Bloomer Radio. The head
Speaker 1: of Bloomer podcast is Francesca Levi. What Goes Up is
Speaker 1: produced by the amazing Tofur Foreheads. This is actually Tofur's
Speaker 1: last week with us. Tofur thank you for all your
Speaker 1: amazing work and patients in dealing with Mike Reagan all
Speaker 1: these years. Will really really miss you, and for everybody else,
Speaker 1: thanks for listening. We'll see you next time.