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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 3: It feels like a quiet Monday, and the asset that's

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Speaker 3: moving is definitely gonna be Bitcoin and all the crypto

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Speaker 3: related stocks. We've got to go to Mike mcloon, Bloomberg Intelligence,

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Speaker 3: Senior Commodities Strategies. Not to mention that gold's little softer

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Speaker 3: at the moment, but that's also still at a record

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Speaker 3: for reasons. It's really hard, I think to pinpoint that

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Speaker 3: reason for it. Hey, Mike, first of all, start with

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Speaker 3: bitcoin here, what if you say having I mean, come on, now,

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Speaker 3: what else is leading this rally?

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Speaker 4: So it's mostly ETF inflows.

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Speaker 5: Alex it was about I think it was January tenth

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Speaker 5: that they're first launching his country. What it was almost

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Speaker 5: almost a dozen of them, and the inflows have been

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Speaker 5: shockingly strong. So I just looked in the numbers on

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Speaker 5: the terminal. Right now, the total mount tracking Bitcoin and

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Speaker 5: ETF now is about seventy billion dollars. I compare that

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Speaker 5: to gold, which is stuck around one hundred and eighty

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Speaker 5: four billion, it's about forty percent. So massive inflows and

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Speaker 5: the having the cut and supply basically around tax day.

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Speaker 5: It's a pretty significant sweet spot for bitcoin. But I

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Speaker 5: find most significant lately is the fact that bitcoin is

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Speaker 5: showing divergent strength versus beta, with the S and P

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Speaker 5: five hundred down this morning.

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Speaker 4: Yeah.

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Speaker 6: I guess one thing about bitcoin, though, is that is

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Speaker 6: a question about volume. We've got a supply shortage, and

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Speaker 6: yet there's tens of billions of dollars trading every day.

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Speaker 6: How do you square these two things.

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Speaker 5: Well, it's not so much a supply storage shortage. I guess,

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Speaker 5: it's just you can see it coming down. It's something

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Speaker 5: that it's the high price care that affects all commodities.

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Speaker 5: With the exception of gold, you don't have that supply

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Speaker 5: coming on with higher prices. But I love when you

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Speaker 5: mentioned volume because I love clicking on coin marketcap dot

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Speaker 5: com and checking volume and the volume of Heather, the

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Speaker 5: number one traded token of which is the US dollar,

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Speaker 5: is basically double bitcoin on a twenty four hour basis,

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Speaker 5: and it's it's market caps up to one hundred and

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Speaker 5: twenty one hundred and two billion now. So it's one

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Speaker 5: thing that a lot of people don't know in the

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Speaker 5: space is bitcoin is speculative. Yes, it's a replacement for gold.

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Speaker 5: It's a digital version. But in this space, the most

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Speaker 5: widely traded acid is the dollar.

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Speaker 3: When you look at say the offshoots of crypto, like

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Speaker 3: the stocks he exchanges, the miners, et cetera, are they

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Speaker 3: trading as well as the underlying asset.

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Speaker 5: Yes, well, I guess we have to mention micro strategy.

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Speaker 5: We've all heard Michael Saylor. I just saw him on

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Speaker 5: a few other programs. Chasing on a one year basis,

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Speaker 5: micro strategy is up almost six hundred percent compared to

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Speaker 5: bitcoin of two hundred and thirty percent. And the significance

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Speaker 5: of him is he's been buying bitcoin. He's one of

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Speaker 5: the stages that really got me somewh at Bullish a

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Speaker 5: few years ago when he's pointing out the history and

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Speaker 5: he says, hey, the world's going digital. This is a

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Speaker 5: potentially replacement of the dollar, not so much the dollar,

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Speaker 5: but of gold. And he's been converting a lot of

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Speaker 5: micro strategy strategy to buying bitcoin rather than doing other

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Speaker 5: things in technology.

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Speaker 6: I guess. But if you go back to your point

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Speaker 6: that we started out with on the ETF flows, I mean,

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Speaker 6: who are the winners and losers here amongst the ETF providers.

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Speaker 6: I mean, is this still a black Rock versus everyone

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Speaker 6: else story? Or is there something more interesting to think about.

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Speaker 5: That The biggest winner is great Scale. They're the ones,

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Speaker 5: so we got to remember they kind of tilted this over.

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Speaker 5: Michael Schoenstein of gray Scale is the one who initiated

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Speaker 5: the litigation with the SEC and he took a major risk.

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Speaker 5: I call it profiles and courage, and he won. So

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Speaker 5: right now, Grayscale, the GBTC, the Greyscale Bitcoin Trust is

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Speaker 5: about twenty eight billion, and the next is the I

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Speaker 5: Shares Bitcoin Trust about thirteen billion. But the thing about

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Speaker 5: I Shore's Bitcoin trust is that didn't exist just a

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Speaker 5: few months ago, and Grayscale was higher. So a lot

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Speaker 5: of that money's migrated. But now it's just net inflows,

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Speaker 5: and I think it's at the stage we're hearing this

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Speaker 5: from professional money managers are tilting that way. And that's

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Speaker 5: what really struck me. When to the ETF conference about

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Speaker 5: a month ago in Miami, Eric Belchuna's moderated panel, and

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Speaker 5: there was so much interest from these you know, i'd

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Speaker 5: say professional money manners in bitcoin.

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Speaker 3: Well that really that's my question. Do if all of

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Speaker 3: a sudden, Bitcoin, for whatever reason, sort of tanks twenty thousand, right,

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Speaker 3: it's super volatile asset, right, Like, no one's pretending that

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Speaker 3: it's not. Do those people that want a one percent

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Speaker 3: allocation in their portfolio to bitcoin care or is this

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Speaker 3: now a long buy and hold strategy with some traders

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Speaker 3: trading around the volatility.

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Speaker 5: Obviously it's the number one traded I like call it

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Speaker 5: the number one traded acid on the planet, twenty four

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Speaker 5: to seven, number one leading indicator alex. But I think

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Speaker 5: what's happening now is we're in the early days of

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Speaker 5: the institutional the rias in pension funds and downments getting

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Speaker 5: allocated in this space. They're starting with one percent. Yeah,

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Speaker 5: of course they care, but they're there. The back tests

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Speaker 5: look too good. Unfortunately. I like to pair it with gold,

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Speaker 5: and I think it's one of those spaces it's either

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Speaker 5: way it goes.

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Speaker 4: It's just it's just early days those inflows.

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Speaker 5: What thing really shocked me was I didn't think there

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Speaker 5: would be that much interest in these ETFs.

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Speaker 4: And you just got to follow the money. It's very

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Speaker 4: strong inflows.

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Speaker 6: Yeah, you know, as you say, it's early days for

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Speaker 6: this ETF strategy. And how do you compare this to

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Speaker 6: the birth of other ETF's markets, Like what can we expect?

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Speaker 6: Can we expect a whole lot more players or is

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Speaker 6: it all going to get weeded out very quickly?

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Speaker 5: That's the thing. It's broken all the records. Compared to

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Speaker 5: GLD or even SPY their early days, it's broken all

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Speaker 5: the records. It's it's basically the benchmark now for it,

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Speaker 5: and I don't think we'll ever be able to match it.

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Speaker 5: The thing is, I compare it somewhat into Tesla. Tesla

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Speaker 5: pays pays, spends nothing on advertising. They don't have to

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Speaker 5: because everybody loves Tesla. Bitcoins the same way. There's nothing

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Speaker 5: to advertise it. But it's so in your face. It's

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Speaker 5: one of those things I put on my d E lists.

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Speaker 5: I try to deliberately ignore, but I can't because you

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Speaker 5: just hear about it and.

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Speaker 4: Read about it everywhere. So that to me is what's happening.

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Speaker 5: And it's just that significant of an asset at the moment,

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Speaker 5: and at some point, yes, it should have a good correction.

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Speaker 5: The key thing that's been bothering me is we've had

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Speaker 5: basically straight up in the S and B five hundred

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Speaker 5: since the low in October.

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Speaker 4: No correction.

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Speaker 5: The most significant correction was the first week of the

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Speaker 5: year is one point five percent. But we've had good

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Speaker 5: corrections in gold, which founded a good foundation. We've had

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Speaker 5: good corrections at bitcoin, which formed a good foundation, you know,

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Speaker 5: flushes out the week longs. We haven't had that in

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Speaker 5: the stock market, and that's what I'm afraid we're way

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Speaker 5: over due for it. Just a normal ten percent correction,

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Speaker 5: you know, like used to happen. How does bitcoin respond

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Speaker 5: in that space? And I think what's happening now, Sure

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Speaker 5: it should go down, but we think the responsive buyers

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Speaker 5: will be greater in bitcoin.

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Speaker 3: So basically it's going to go down less. This is

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Speaker 3: totally the classic gold argument too, like when everything goes down,

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Speaker 3: so does gold, but it goes down less Bitcoin the same.

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Speaker 5: Then, yes, well it did initially two thousand and eight.

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Speaker 5: But the difference with gold now is it it's basically

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Speaker 5: been unchanged for three years. It's had that time correction,

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Speaker 5: it's had that little correction this year down to two thousand,

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Speaker 5: and that's the difference with the S and B five hundred.

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Speaker 4: I love watching the E mini weeklies. I used to

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Speaker 4: trade them.

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Speaker 5: There's a gap and WENT mini weeklies from last year

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Speaker 5: when we broke out and the Powell pivot.

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Speaker 4: It's about TEMP ten percent below the market.

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Speaker 5: We've never left the gap in the S and P

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Speaker 5: mini since trading A nineteen ninety seven on a weekly basis,

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Speaker 5: So that kind of stuff concerns me.

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Speaker 6: Okay, one last question for you if you don't mind.

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Speaker 3: For bitcoin mines. He doesn't like talking about bitcoin at all.

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Speaker 6: No, No, I think I'll think I'll just say this one.

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Speaker 3: I want to get out of here. Back to the song.

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Speaker 6: If we do see an SMP correction anytime this year,

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Speaker 6: how do you what do you think the margin's going

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Speaker 6: to be like between the Bitcoin correction and the SMP correction.

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Speaker 5: Typically Bitcoin trades with about a three x beta or

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Speaker 5: three x volatility. You know, if it SMP corrects ten percent,

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Speaker 5: Bitcoin goes down thirty percent. But what it's showing right

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Speaker 5: now is divergent strength. As you see it today, S

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Speaker 5: and P five hundreds down, Bitcoin's up. So if it

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Speaker 5: was put this way, a successful divergent strength with to

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Speaker 5: save the SMP five five hundred corrects ten percent and

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Speaker 5: bitcoin corrects only ten or fifteen percent. That's a sign

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Speaker 5: of divergent strength. Right now, stock market's going up and bitcoins.

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Speaker 5: I'm sorry, stock Mark's going down and bitcoin's going up. Now,

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Speaker 5: that's somewhat unstoppable for money flows. If people see this

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Speaker 5: as a ursa fire's going to be. It's gonna just

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Speaker 5: the horde will come. And that's what I'm afraid of.

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Speaker 3: Hey, my really good perspective. Love that you look a

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Speaker 3: little tan. How's that sun there in Florida?

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Speaker 4: It's it's rough. I mean, the vitamin D is great,

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Speaker 4: keeps you healthy.

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Speaker 3: Mike mcgloan, Paul SMENI always jealous that Mike. When is

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Speaker 3: his way to Florida? Mike mcgloan, he covers everything a

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Speaker 3: commodities research focused for a Bloomberg Intelligence. I mean I

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Speaker 3: think that once I get positive on bitcoin, then we

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Speaker 3: probably have a problem.

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Speaker 6: Oh that would definitely be a signal for myself if

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Speaker 6: I'm starting to look at it, and that would mean

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Speaker 6: so that right, I.

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Speaker 3: Mean, that's what I'm looking at. But it's going to

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Speaker 3: be interesting. I think just in terms of how much

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Speaker 3: portfolios wind up allocating, right, Like I remember this with gold,

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Speaker 3: I mean back in the day. You know, if you

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Speaker 3: have central banks reallocate by one per extra percent, it

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Speaker 3: would be a huge boon to gold prices. And you

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Speaker 3: have to wonder beating a ten percent portfolio for people

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Speaker 3: or is it really just going to be one percent?

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Speaker 3: And that what that shift actually winds up looking like.

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Speaker 6: But that's the issue. It's like where does central banks

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Speaker 6: stand on the matter. And there's a lot of unhappy

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Speaker 6: not unhappiness, but a lot of reluctance. I mean, Powell

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Speaker 6: last week said pretty firmly the FED is not anywhere

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Speaker 6: near there yet. So we're not going to have that

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Speaker 6: dynamic anytime soon to worry about.

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Speaker 3: John Tucker, you got bitcoin that portfolio?

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Speaker 7: Uh no, that's the one. I don't have.

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Speaker 3: The crypto stocks.

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Speaker 4: My no.

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Speaker 7: My philosophy is if you don't understand its, stay far

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Speaker 7: far away.

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Speaker 3: I know, but at some point we're gonna look at

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Speaker 3: it and be like, we got to get into that.

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Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 2: listen live on Amazon Alexa from our flagship New York station.

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Speaker 2: Just say Alexa play Bloomberg eleven thirty.

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Speaker 3: Okay, so markets, let's be honest, not doing that much.

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Speaker 3: We're looking at that weakness and meta that we were

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Speaker 3: just talking about. We're kind of questioning if bitcoin's going

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Speaker 3: to keep rallying, if an ASDAC doesn't really get any

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Speaker 3: support here. And my big question, of course, throughout the

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Speaker 3: whole two hours is I will find someone who has

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Speaker 3: watched the oscars and can talk with me about I'm

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Speaker 3: just ken. Maybe this person will be Sarah Ponzick, financial

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Speaker 3: advisor at UBS Private Wealth Management. Is it?

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Speaker 8: Is it?

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Speaker 3: Sarah? Are you that person for me?

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Speaker 9: Alex, I'm so sorry to disappoint you, but no. Last night,

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Speaker 9: but I have seen Barbie, but no, I didn't watch.

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Speaker 3: This does not count Sarah. You okay?

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Speaker 8: All right?

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Speaker 3: Well this is actually going to be a thing. This

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Speaker 3: is Will I find someone in the next hour and

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Speaker 3: a half that has seen the oscars that can talk

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Speaker 3: about I'm just Ken? In the meantime, Sarah, let's talk

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Speaker 3: about the markets. What do you make of this?

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Speaker 4: Uh?

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Speaker 10: Oscars are more important, right, I know, I.

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Speaker 3: Mean to them for Sureticlarly for Disney, they did really well.

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Speaker 3: They did, they did. Yeah, they probably were very happy

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Speaker 3: about that. Anyway, Sarah, Nvidia losing a little bit of steam.

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Speaker 3: It's flat right now, Meta kind of rolling over. What's

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Speaker 3: your read on tech right now?

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Speaker 10: Right?

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Speaker 9: So it's only natural that we are seeing some of

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Speaker 9: these big tech names taking a breather.

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Speaker 10: We can't see them continue to.

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Speaker 9: Power higher and higher and higher at the rate of

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Speaker 9: what we've seen over the past year, let's say. But

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Speaker 9: with that said, we're still pretty optimistic on tech here,

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Speaker 9: and there's.

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Speaker 10: A couple of reasons for that. One.

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Speaker 9: Yes, AI has this massive buzzword, but when you look

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Speaker 9: at the underlying fundamentals and you look at the amount

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Speaker 9: of money that companies are spending on infrastructure, spend on

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Speaker 9: technology to make sure that they are at the forefront

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Speaker 9: of their AI game, we sow it and in Video's

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Speaker 9: earnings just a few weeks ago, there is actually truth

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Speaker 9: to this, and our Chief Investment office actually estimates that

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Speaker 9: AI revenues are going to grow seventy percent a year

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Speaker 9: through twenty twenty seven, so massive growth aheads. So there

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Speaker 9: is reason that and there are numbers, frankly that are

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Speaker 9: driving this rally.

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Speaker 10: So we're still optimistic on tech.

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Speaker 9: That doesn't mean that these magnificent companies are your entire

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Speaker 9: equity portfolio. But what it does mean is you want

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Speaker 9: to make sure that you're.

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Speaker 10: Not under exposed to tech. You don't want so much.

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Speaker 9: Less tech than your portfolio than the benchmark, per se,

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Speaker 9: because the risk here is really missing out and being

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Speaker 9: under exposed to what might be one of the greatest

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Speaker 9: growth trends in the stock market over the next decade.

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Speaker 6: I want to push you a little bit on your

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Speaker 6: point about companies continuing to spend and invest. I mean,

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Speaker 6: what's your outlook for companies to continue to have strong

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Speaker 6: power to do that, because you know what's the market

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Speaker 6: thinking about now. They're thinking about the FED meeting coming

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Speaker 6: up next week and the prospects for a soft landing.

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Speaker 6: If there is slow down, then that would set the

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Speaker 6: read across to that for company spending would be reduced spending.

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Speaker 6: So how do you put these two things together?

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Speaker 9: You're right, and we've seen that run and center over

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Speaker 9: the past couple of years, especially in the technology space.

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Speaker 9: We have seen some technology companies that for years they've

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Speaker 9: been known for having vast expansive workforces, go through a

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Speaker 9: series of layoffs, and.

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Speaker 10: They have been doing cost cuts. But when you think

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Speaker 10: about the.

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Speaker 9: Overall economy and not just the US economy, the global economy,

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Speaker 9: and when companies are sitting in a room together and

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Speaker 9: they're thinking about what is the most important thing for

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Speaker 9: us to be spending our revenues on in the years ahead,

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Speaker 9: the decade ahead. Oftentimes, and we've heard this in earnings calls,

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Speaker 9: it's artificial intelligence because many companies know that again they

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Speaker 9: can't risk falling behind, they don't want to risk their

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Speaker 9: competitors serving ahead of them.

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Speaker 10: So, yes, you're absolutely right.

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Speaker 9: We have seen companies cost cutting, and those that have

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Speaker 9: been cost cutting have.

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Speaker 10: Been rewarded for that.

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Speaker 9: But when it comes to deciding where you want to

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Speaker 9: spend your money, tech spend has still been very important.

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Speaker 3: So, Sarah, if though we take a little bit of

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Speaker 3: breather intech, do you think that there's enough of a

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Speaker 3: powerful rotation into other areas of the market, aka some

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Speaker 3: kind of value in cyclicals to help support the overall

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Speaker 3: index or we're just going to see some level of softness.

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Speaker 10: All so, we have seen a broadening out. Absolutely.

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Speaker 9: We have seen a broadening out since late last year

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Speaker 9: and even more so this year, and we do expect

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Speaker 9: that to continue. So to give you an idea, yes,

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Speaker 9: we do like technology here, but a couple of other

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Speaker 9: sectors we still like here are healthcare and industrials.

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Speaker 10: A few reasons for that.

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Speaker 9: One is healthcare can be seen as a more defensive

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Speaker 9: area if you want to diversify your portfolio, but has

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Speaker 9: also had a major boost from all these OBESD drugs

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Speaker 9: that have just exploded in popularity.

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Speaker 10: Industrials, that's more of a cyclical play.

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Speaker 9: If we truly do see this goldilocks economic scenario in

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Speaker 9: a soft landing, which has come to be the base case,

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Speaker 9: you would expect that more cyclical areas of the economy

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Speaker 9: are going to start doing some of the heavy lifting.

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Speaker 9: It's not going to be tech alone. So yes, even

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Speaker 9: if we do see tech take a breather, look, we're

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Speaker 9: probably not going to see the same returns that we

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Speaker 9: saw last year in the SMB and then ADDAC, but

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Speaker 9: you could still see positive returns going forwards for equity

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Speaker 9: markets as we start to see other sectors other industries

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Speaker 9: pull their.

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Speaker 10: Weight as well.

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Speaker 6: What's the sector that you think it's gonna be suffering

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Speaker 6: the most going ahead.

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Speaker 10: It's a great question. What I would say.

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Speaker 9: Certain areas of the market that we haven't been huge

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Speaker 9: fans of lately have been utilities real estate. Some of

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Speaker 9: that was a yield play with interest weights where they are,

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Speaker 9: you don't really need to go find higher paying dividend

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Speaker 9: stocks or bond proxies in the sense of utilities. But

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Speaker 9: it's just not an area that we've favored so far.

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Speaker 3: What is your thought though on Bitcoin? Let's kind of

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Speaker 3: end where we left off, which is the idea of Okay,

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Speaker 3: you have this tech softness, Bitcoin's on a tear, and

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Speaker 3: having tech be a teeny bit softer and Bitcoin doing

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Speaker 3: really well is a bit of a head scratcher. So

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Speaker 3: I'm wondering what you think about it.

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Speaker 9: I should have known coming into this that you would

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Speaker 9: ask me about the oscars and Bitcoin.

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Speaker 3: I really should have.

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Speaker 10: I should have known. This is what I would say.

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Speaker 9: There really are still no fundamental drivers behind bitcoin. Yes,

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Speaker 9: there has been a massive rust to the space ever

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Speaker 9: since launch of bitcoin ets. It's just made it much

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Speaker 9: easier for investors to get a piece of it. I

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Speaker 9: will say crypto is becoming it is an asset class.

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Speaker 10: It's not becoming.

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Speaker 9: It is an asset class, and for many it has

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Speaker 9: become a small component of portfolios as a diversified portfolio.

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Speaker 9: But at the same time, before any investor is going

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Speaker 9: to dip their toes into the bitcoin market or the

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Speaker 9: crypto market, especially at the levels we see bitcoin trading

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Speaker 9: at now, you have to look yourself in the mirror

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Speaker 9: and ask yourself if you if you're okay and you're

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Speaker 9: prepared and willing to tolerate the volatility that that's going

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Speaker 9: to come with, because yes, it's been a straight shot

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Speaker 9: up over the last year, but we you know, people

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Speaker 9: have amnesia.

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Speaker 10: The same thing with tech stocks too.

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Speaker 9: Yeah, everyone remembers twenty twenty three in which tech ran

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Speaker 9: up and bitcoin ran up, But how did you feel

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Speaker 9: in twenty twenty two.

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Speaker 10: It's all everything you know taking a take time as well.

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Speaker 9: So there's still a lot of unknown surrounding what crypto

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Speaker 9: is going to become, where bitcoin really fits into our

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Speaker 9: economy and the financial marketplace.

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Speaker 10: So there's still going to be volatility. It's an asset class,

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Speaker 10: but you have to.

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Speaker 9: Be able to make sure that if you're going to

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Speaker 9: invest in bitcoin, you need to be able to look

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Speaker 9: at the volatility.

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Speaker 3: All right, Sarah, next time, next time, you'll do better,

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Speaker 3: all right, Sarah Ponzik, financial advisor at UBS Private Wealth Management.

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Speaker 3: Great stuff, joining us there on the idea you got

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Speaker 3: to be cautious when you're buying bitcoin. I love that.

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Speaker 3: Can you look at yourself in the mirror and feel

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Speaker 3: okay about it?

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Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on Apple card Play and

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Speaker 2: then Broid Auto with the Bloomberg Business App. Listen on

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Speaker 2: demand wherever you get your podcasts, or watch us live

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Speaker 2: on YouTube.

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Speaker 3: Let's go now to the news over the weekend, which

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Speaker 3: was Reddit finally getting it together to launch its long

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Speaker 3: awaited ipo Amy or Bloomberg Equity Capital Markets reporter joins us. Now, first,

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Speaker 3: did you watch the oscars?

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Speaker 10: I am a lot of journey.

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Speaker 3: I am alone people so far.

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Speaker 7: When the ratings come out, so we know how many

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Speaker 7: people didn't.

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Speaker 3: Want to My husband and my daughter didn't.

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Speaker 7: Like Arbitron or whatever, will we will watch that and

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Speaker 7: learn the Nielsen ratings.

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Speaker 3: Okay, now, John Tucker, your assignment right now, go watch

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Speaker 3: I'm just ken, I'm just watching, just watch him doing

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Speaker 3: the segment.

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Speaker 7: Fine, I want to listen to Amy though.

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Speaker 3: Reddit remind us what redd it is.

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Speaker 1: First of all, it's a social platform essentially for people

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Speaker 1: to to talk about anything, and then it's kind of

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Speaker 1: wolved into a place where you can find information about

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Speaker 1: really deep dive into things.

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Speaker 3: So a lot of like guys would be.

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Speaker 1: Like chatting about like running shoes and what model fits

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Speaker 1: and how it fits and then how to break shoes

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Speaker 1: in that kind of thing and many other more and

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Speaker 1: sometimes it's good, sometimes like questionable. So it's it's a

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Speaker 1: social platform for people to express their views and ideas.

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Speaker 6: I wonder if they must have and I'm just ken

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Speaker 6: thread there has to be have today.

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Speaker 3: Okay, you ask another question that's smart and I'm gonna

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Speaker 3: look that up.

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Speaker 6: Okay, So I guess can you give us some context

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Speaker 6: for the Reddit ipo what's the size that's being projected?

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Speaker 6: And then how does this fit in with how the

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Speaker 6: market is developing so far this year? Because last year

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Speaker 6: it was not such a good IPO market.

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Speaker 9: Wasn't.

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Speaker 1: Yeah, it wasn't, and it's still the IPO market is

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Speaker 1: still rawles subduced. So far this year there were only

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Speaker 1: about seven billion raised, but there were five IPOs more

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Speaker 1: than raising more than five hundred million dollars, which is yeah, decent,

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Speaker 1: but compared to twenty twenty one when redd it actually

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Speaker 1: filed confidentially for an IPO, that was an all time high,

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Speaker 1: that was more than three hundred and thirty billion dollars raised,

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Speaker 1: and then so like in the grand scheme of things,

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Speaker 1: we're definitely not there and might not even see that

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Speaker 1: ever again. And then at that time when Reddit actually

440
00:19:50,280 --> 00:19:53,000
Speaker 1: filed for an IPO, it was value at ten billion.

441
00:19:53,200 --> 00:19:56,440
Speaker 1: Right now, at thirty one to thirty four dollars price

442
00:19:56,560 --> 00:20:01,000
Speaker 1: range per share, it's like if it's price at the

443
00:20:01,359 --> 00:20:02,960
Speaker 1: upper end of the range is going to be six

444
00:20:03,000 --> 00:20:05,520
Speaker 1: point four billion in terms of valuation, So it's still

445
00:20:05,600 --> 00:20:08,560
Speaker 1: like a bit off from the ten billion that it

446
00:20:08,640 --> 00:20:10,920
Speaker 1: was projected to be back in a few years ago.

447
00:20:10,960 --> 00:20:13,520
Speaker 1: So it's kind of missed the boat in terms of

448
00:20:13,560 --> 00:20:16,560
Speaker 1: IPOs sentiment, and so we're going to see whether it's

449
00:20:16,600 --> 00:20:18,240
Speaker 1: going to be So there is still a tone that

450
00:20:18,280 --> 00:20:21,159
Speaker 1: they can price above the range, but we'll have a

451
00:20:21,200 --> 00:20:22,000
Speaker 1: look January.

452
00:20:22,119 --> 00:20:25,560
Speaker 3: Right there is a Reddit thread I'm just ken, so

453
00:20:25,880 --> 00:20:28,400
Speaker 3: I find at least somebody is with me on this one.

454
00:20:29,440 --> 00:20:31,960
Speaker 3: Talk to me about how reddit will also got into

455
00:20:31,960 --> 00:20:34,400
Speaker 3: the vernacular when it comes to the meme stock craze

456
00:20:34,880 --> 00:20:36,920
Speaker 3: that we saw, right. I mean, that's when Reddit became

457
00:20:37,000 --> 00:20:40,440
Speaker 3: super significant to Wall Street in a very particular way.

458
00:20:40,720 --> 00:20:43,680
Speaker 1: I think it was significant in a lot of people's hearts,

459
00:20:43,760 --> 00:20:46,600
Speaker 1: like for the geeks, but it's kind of like significant

460
00:20:46,640 --> 00:20:49,639
Speaker 1: when people actually went on the theme where they can

461
00:20:49,680 --> 00:20:53,119
Speaker 1: actually talk about stocks and then and to actually to

462
00:20:53,200 --> 00:20:56,879
Speaker 1: assemble the amount of buying interest in a particular stock

463
00:20:56,920 --> 00:20:59,720
Speaker 1: that actually drove the prices higher. And I think redd

464
00:20:59,720 --> 00:21:02,160
Speaker 1: It is trying to replicate that for his own IPO

465
00:21:02,240 --> 00:21:06,240
Speaker 1: as well. They're giving eight percent of the IPO to

466
00:21:06,560 --> 00:21:11,280
Speaker 1: people who are really heavy users moderators of Reddit threats.

467
00:21:11,760 --> 00:21:14,160
Speaker 1: But then the funny thing though, is for these eight

468
00:21:14,200 --> 00:21:17,199
Speaker 1: percent of the stocks, they do not have a lock up.

469
00:21:17,520 --> 00:21:19,920
Speaker 1: So it would be very interesting to actually see whether

470
00:21:19,960 --> 00:21:21,879
Speaker 1: they actually sell on the first day or during the

471
00:21:21,880 --> 00:21:24,400
Speaker 1: first week, because at the end of the day, these

472
00:21:24,440 --> 00:21:27,840
Speaker 1: are retail investors. Technically, a lot of the IPOs or

473
00:21:27,880 --> 00:21:31,400
Speaker 1: issuers do not like retail investors because they're very sentimental.

474
00:21:31,480 --> 00:21:34,720
Speaker 1: They're very emotional. If it rises a lot, and then

475
00:21:34,800 --> 00:21:37,159
Speaker 1: on the first day and then people will sell. If

476
00:21:37,800 --> 00:21:40,320
Speaker 1: it falls a lot, people will pan excel as well.

477
00:21:40,600 --> 00:21:43,000
Speaker 1: So that's why most of the time people will allocate

478
00:21:43,040 --> 00:21:45,920
Speaker 1: a lot more to institutions. The fact that they actually

479
00:21:46,160 --> 00:21:49,919
Speaker 1: allocate eight percent, I think they're trying to replicate that

480
00:21:50,119 --> 00:21:52,320
Speaker 1: meme kind of craze like for his own stock. But

481
00:21:52,400 --> 00:21:54,359
Speaker 1: whether it works or not is a different story.

482
00:21:54,960 --> 00:21:57,000
Speaker 6: One crazy question though, I would like to ask you.

483
00:21:57,000 --> 00:21:58,560
Speaker 6: You might have no view on this, but I want

484
00:21:58,560 --> 00:22:02,920
Speaker 6: to ask it. Anyway, We've got two very interesting internet

485
00:22:02,960 --> 00:22:05,480
Speaker 6: plays in the news today. We've got Reddit, but then

486
00:22:05,480 --> 00:22:08,680
Speaker 6: we also have TikTok. Do you see anyway the put

487
00:22:08,720 --> 00:22:11,080
Speaker 6: these two together in your head for an investor, for

488
00:22:11,160 --> 00:22:13,080
Speaker 6: a user, for a sentiment.

489
00:22:13,160 --> 00:22:15,680
Speaker 1: Well, it's really at the end of the day, it's

490
00:22:15,720 --> 00:22:18,320
Speaker 1: really about advertising and how much you can and also

491
00:22:18,359 --> 00:22:21,639
Speaker 1: how sticky in terms of the users. Right, Definitely, a

492
00:22:21,680 --> 00:22:24,879
Speaker 1: lot of the Reddit users are actually very sticky. But

493
00:22:24,920 --> 00:22:28,639
Speaker 1: then it's also most of the well not most, but

494
00:22:28,800 --> 00:22:30,919
Speaker 1: have of the users for Reddit do not actually have

495
00:22:30,920 --> 00:22:33,679
Speaker 1: a log in or do not actually seize most of

496
00:22:33,720 --> 00:22:36,440
Speaker 1: the ads. And then so whether it can actually turn

497
00:22:36,880 --> 00:22:40,320
Speaker 1: that into ad revenue, it's a different story. But then

498
00:22:40,800 --> 00:22:42,879
Speaker 1: read it now is trying to license some of the

499
00:22:43,240 --> 00:22:46,760
Speaker 1: geeky kind of links of threats in order to generate

500
00:22:47,280 --> 00:22:50,280
Speaker 1: revenue for itself. Because it's actually like it struck the

501
00:22:50,280 --> 00:22:54,720
Speaker 1: first deal with Google right now to read and ask

502
00:22:54,800 --> 00:22:59,000
Speaker 1: the AI to actually machine to learn it. So at

503
00:22:59,000 --> 00:23:01,600
Speaker 1: the end of the day AI, the more information, the

504
00:23:01,640 --> 00:23:05,080
Speaker 1: better information, the more deep dive into things that it gets,

505
00:23:05,320 --> 00:23:08,200
Speaker 1: the better result it will generate. So it's a good

506
00:23:08,240 --> 00:23:11,320
Speaker 1: thing that they have that vast eighteen nineteen years of

507
00:23:11,480 --> 00:23:14,240
Speaker 1: treasure tro that it can actually use. But at the

508
00:23:14,359 --> 00:23:17,040
Speaker 1: end of the day, it's kind of like Wikipedia. It's

509
00:23:17,600 --> 00:23:21,760
Speaker 1: sometimes you can't verify stuff, right So yeah, it's it's yeah,

510
00:23:22,040 --> 00:23:22,920
Speaker 1: up to but.

511
00:23:22,800 --> 00:23:24,800
Speaker 3: I would say also the big difference is that it's not,

512
00:23:25,440 --> 00:23:27,639
Speaker 3: in the end of the day a Chinese company right now,

513
00:23:27,760 --> 00:23:29,880
Speaker 3: this is true. I mean I appreciate TikTok is quote

514
00:23:29,960 --> 00:23:32,119
Speaker 3: unquote domiciled in the US, but like if you thread

515
00:23:32,119 --> 00:23:33,359
Speaker 3: the needle, it goes up to China.

516
00:23:33,480 --> 00:23:36,040
Speaker 6: Indeed, and this is the one issue that TikTok has

517
00:23:36,040 --> 00:23:39,480
Speaker 6: been trying to convince investors, have convince US politicians of

518
00:23:39,520 --> 00:23:40,919
Speaker 6: that no, no, no, we're based in the US, but

519
00:23:41,160 --> 00:23:43,320
Speaker 6: it looks like nobody's bought that story. And here we

520
00:23:43,359 --> 00:23:45,680
Speaker 6: are with this legislation going through Congress, and.

521
00:23:45,680 --> 00:23:48,440
Speaker 1: We've seen Sheen as well. Sheen was supposed to actually

522
00:23:48,480 --> 00:23:52,040
Speaker 1: come this year to the US, and it's exploring other

523
00:23:52,160 --> 00:23:55,040
Speaker 1: places for listing, like the UK just because of that

524
00:23:55,160 --> 00:23:58,239
Speaker 1: Chinese connection. So but then arm also has like kind

525
00:23:58,280 --> 00:24:01,800
Speaker 1: of a like a risk spector in China as well.

526
00:24:01,880 --> 00:24:03,680
Speaker 1: But then it went through as well. So at the

527
00:24:03,760 --> 00:24:06,920
Speaker 1: end of the day, like whether like yeah, TikTok bite

528
00:24:06,960 --> 00:24:08,800
Speaker 1: guns will come, like yeah.

529
00:24:08,760 --> 00:24:12,200
Speaker 3: We'll have to see. For Reddit, why do you think

530
00:24:12,240 --> 00:24:13,280
Speaker 3: it's it decided?

531
00:24:13,320 --> 00:24:13,520
Speaker 8: Now?

532
00:24:13,680 --> 00:24:14,200
Speaker 3: Is the time?

533
00:24:15,720 --> 00:24:18,959
Speaker 1: Actually a lot of the times where IPOs actually come

534
00:24:19,000 --> 00:24:21,679
Speaker 1: to the market at during this time when the market

535
00:24:21,760 --> 00:24:25,640
Speaker 1: is not fully opens. It's a certain kind of factors.

536
00:24:25,760 --> 00:24:29,000
Speaker 1: Is whether it needs money for growth or it wants

537
00:24:29,000 --> 00:24:32,240
Speaker 1: to actually give the venue for his employees to sell.

538
00:24:32,720 --> 00:24:37,040
Speaker 1: And obviously there are private share platforms that allow that

539
00:24:37,160 --> 00:24:40,000
Speaker 1: to do that, but then it's not as liquid and

540
00:24:40,119 --> 00:24:43,040
Speaker 1: so at the end of the day, for this particular

541
00:24:44,200 --> 00:24:47,320
Speaker 1: Reddit sale ipo, a third of it comes from its

542
00:24:47,400 --> 00:24:50,919
Speaker 1: employees wanting to sell. So that is part of the

543
00:24:51,000 --> 00:24:54,320
Speaker 1: driver for his IPO to come right now, you know.

544
00:24:54,320 --> 00:24:57,600
Speaker 6: What is investor appetite generally now for the risk of

545
00:24:57,640 --> 00:24:59,560
Speaker 6: an IPO, because you said the market has been like

546
00:24:59,600 --> 00:25:01,520
Speaker 6: sort of coming back, but this is in the midst

547
00:25:01,840 --> 00:25:03,240
Speaker 6: of a massive run up in the S and P

548
00:25:03,359 --> 00:25:04,760
Speaker 6: five hundred exactly.

549
00:25:04,840 --> 00:25:08,160
Speaker 1: So in terms of equity capital market, all the other

550
00:25:08,240 --> 00:25:11,120
Speaker 1: chunnels are really fired up, like all the other two

551
00:25:11,160 --> 00:25:15,440
Speaker 1: engines in terms of secondary share sales and also convertible bonds,

552
00:25:15,440 --> 00:25:17,800
Speaker 1: they are just going through the roof. Last two weeks,

553
00:25:17,800 --> 00:25:20,800
Speaker 1: it was like more than ten billion a week, which

554
00:25:20,880 --> 00:25:23,879
Speaker 1: was amazing, and then like in terms of convertible bonds,

555
00:25:23,960 --> 00:25:27,840
Speaker 1: like a week was yeah, a third of last year's

556
00:25:28,480 --> 00:25:31,200
Speaker 1: new issuance as well, so it was great. But then

557
00:25:31,280 --> 00:25:34,120
Speaker 1: that has not transferred into the IPO, which is an

558
00:25:34,280 --> 00:25:39,119
Speaker 1: risky asset. So we have seen that the discount that

559
00:25:39,160 --> 00:25:43,200
Speaker 1: people investors were asking for IPOs is still at twenty

560
00:25:43,280 --> 00:25:46,399
Speaker 1: twenty five percent discount to a ready list of peers

561
00:25:46,480 --> 00:25:49,240
Speaker 1: versus ten to fifteen percent in the past, so that

562
00:25:49,320 --> 00:25:51,679
Speaker 1: sentiment has not come back. People still want to have

563
00:25:51,880 --> 00:25:54,199
Speaker 1: a bit of a cushion. And the fact that like

564
00:25:54,280 --> 00:25:58,399
Speaker 1: the first two big IPOs, Aimer Sports and also bright Spring,

565
00:25:58,720 --> 00:26:02,080
Speaker 1: they weren't trading as well is still like a concern

566
00:26:02,320 --> 00:26:04,800
Speaker 1: lingering on a lot of investors' mind.

567
00:26:05,000 --> 00:26:08,159
Speaker 3: Amy, great stuff, a really great conversation. I learned so

568
00:26:08,240 --> 00:26:09,960
Speaker 3: much in that. Thank you so much, Amy, or Bloomberg

569
00:26:09,960 --> 00:26:11,840
Speaker 3: Equity Capital Markets Reporter.

570
00:26:13,480 --> 00:26:17,399
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

571
00:26:17,480 --> 00:26:21,000
Speaker 2: weekdays at ten am Eastern on applecar Play and Android

572
00:26:21,000 --> 00:26:23,800
Speaker 2: Auto with the Bloomberg Business app. You can also listen

573
00:26:23,920 --> 00:26:27,000
Speaker 2: live on Amazon Alexa from our flagship New York station,

574
00:26:27,359 --> 00:26:30,159
Speaker 2: Just say Alexa play Bloomberg eleven thirty.

575
00:26:31,400 --> 00:26:34,320
Speaker 3: Let's flex the muscles. I know one person who has

576
00:26:34,440 --> 00:26:37,640
Speaker 3: definitely seen the oscars, and that's keitha wronganath and Bloomberg

577
00:26:37,680 --> 00:26:42,600
Speaker 3: Intelligence analyst for US Media. Have you Youthael? Actually I

578
00:26:42,640 --> 00:26:45,600
Speaker 3: don't know for sure. I hope so getha. Have you

579
00:26:45,680 --> 00:26:46,880
Speaker 3: seen it? Did you see it?

580
00:26:47,640 --> 00:26:49,280
Speaker 8: I did it away.

581
00:26:50,359 --> 00:26:52,880
Speaker 3: For the record, I have been trying to find one

582
00:26:52,920 --> 00:26:55,520
Speaker 3: person on this radio show so far who has seen

583
00:26:55,560 --> 00:26:57,679
Speaker 3: it who can talk about I'm just ken with me

584
00:26:57,760 --> 00:27:00,720
Speaker 3: and I have struck out, which I feel like is

585
00:27:00,760 --> 00:27:03,199
Speaker 3: part of the point. No one watched it with me

586
00:27:03,280 --> 00:27:04,800
Speaker 3: except for my husband and my daughter.

587
00:27:06,920 --> 00:27:10,159
Speaker 11: Yeah, I mean this is this has been the perenial question, Alex.

588
00:27:10,200 --> 00:27:13,960
Speaker 11: I mean about ratings, right, is linear TV even relevant anymore?

589
00:27:14,160 --> 00:27:16,640
Speaker 11: But you'll be surprised to know the oscars actually are

590
00:27:16,720 --> 00:27:21,240
Speaker 11: one of the most watched non sports telecast on TV

591
00:27:21,440 --> 00:27:24,720
Speaker 11: every year. And yes, ratings are down. So back about

592
00:27:24,720 --> 00:27:27,280
Speaker 11: twenty years ago, it was about forty million people tuning

593
00:27:27,280 --> 00:27:31,000
Speaker 11: into you know, the Academy Academy Awards ceremony. Now it's

594
00:27:31,000 --> 00:27:34,639
Speaker 11: closer to about twenty million, but that's still a huge audience,

595
00:27:34,760 --> 00:27:37,600
Speaker 11: kind of considering that the PATV universe is also kind

596
00:27:37,640 --> 00:27:39,080
Speaker 11: of shrunk by about twenty five percent.

597
00:27:39,240 --> 00:27:41,240
Speaker 3: Okay, so, so what did you think about I'm just.

598
00:27:41,200 --> 00:27:45,239
Speaker 11: Can I thought it was brilliant. It might have been

599
00:27:45,280 --> 00:27:48,240
Speaker 11: the most Yeah, me too, me too. That was the

600
00:27:48,240 --> 00:27:50,359
Speaker 11: most exciting part of the whole ceremony.

601
00:27:50,440 --> 00:27:53,080
Speaker 3: It was awesome. And they did a whole like harken

602
00:27:53,200 --> 00:27:56,840
Speaker 3: back to Marilyn Monroe and then Madonna wearing pink and

603
00:27:56,880 --> 00:27:59,440
Speaker 3: wearing Gosling and pink and the and the guys in

604
00:27:59,480 --> 00:28:02,159
Speaker 3: the back in the same cost. You had to see it.

605
00:28:02,200 --> 00:28:05,280
Speaker 3: You just had to see it. It was really awesome. Okay. Anyway, sorry, Jen,

606
00:28:05,359 --> 00:28:06,399
Speaker 3: you can ask a real question.

607
00:28:06,359 --> 00:28:07,320
Speaker 6: Can I ask a real question?

608
00:28:07,560 --> 00:28:07,679
Speaker 9: So?

609
00:28:08,680 --> 00:28:10,760
Speaker 6: Who are the winners and losers here in terms of

610
00:28:10,960 --> 00:28:14,119
Speaker 6: old media versus upstart streamers, it looks like Dizzy did

611
00:28:14,240 --> 00:28:17,240
Speaker 6: very well. Comcasted, well, what's your take here?

612
00:28:18,040 --> 00:28:19,480
Speaker 8: Yeah, I'm really glad you asked that question.

613
00:28:19,520 --> 00:28:22,240
Speaker 11: I think the one big surprise, and this is really

614
00:28:22,280 --> 00:28:24,520
Speaker 11: good for old media, is that old media is back.

615
00:28:24,680 --> 00:28:29,080
Speaker 11: Theaters are back, the theatrical experiences back, and you know,

616
00:28:29,320 --> 00:28:31,960
Speaker 11: in a kind of this wild twist, streaming was kind

617
00:28:31,960 --> 00:28:35,600
Speaker 11: of almost completely shut out. So going into the Oscars,

618
00:28:35,640 --> 00:28:38,200
Speaker 11: we really had, you know, the two stream big streaming

619
00:28:38,840 --> 00:28:42,560
Speaker 11: you know, giants in a way, Netflix with nineteen nominations

620
00:28:42,720 --> 00:28:46,040
Speaker 11: they only got one. You had Apple with Killers of

621
00:28:46,080 --> 00:28:50,600
Speaker 11: the Flower Moon with thirteen nominations, they got completely shut out,

622
00:28:51,120 --> 00:28:52,800
Speaker 11: so you know, and then of course you had the

623
00:28:52,800 --> 00:28:56,640
Speaker 11: big suite with Comcast, Universal with with Oppenheimer's. So you know,

624
00:28:56,680 --> 00:28:59,680
Speaker 11: in many ways, this was really a resounding success for

625
00:29:00,080 --> 00:29:04,120
Speaker 11: the theatrical model and for the long established studios.

626
00:29:04,440 --> 00:29:07,880
Speaker 3: Also Disney, right, I mean Poor Things, Disney with Poor Things, Yeah,

627
00:29:08,160 --> 00:29:11,000
Speaker 3: where things came out of nowhere in my world. I mean,

628
00:29:11,080 --> 00:29:13,160
Speaker 3: I'm not the judge of everything or anything like that,

629
00:29:13,240 --> 00:29:15,840
Speaker 3: but it seems like Poor Things really came out and

630
00:29:15,880 --> 00:29:19,640
Speaker 3: stole a lot of awards that maybe we weren't necessarily expecting,

631
00:29:19,680 --> 00:29:21,200
Speaker 3: which which is a great win for Disney.

632
00:29:22,400 --> 00:29:25,920
Speaker 11: It absolutely was, and considering you know, the budget, you know,

633
00:29:25,960 --> 00:29:28,880
Speaker 11: and everything that kind of went with it. It's you know,

634
00:29:28,960 --> 00:29:32,120
Speaker 11: Searchlight and the Fox acquisition from from this, from this

635
00:29:32,200 --> 00:29:34,239
Speaker 11: studio point of view, from from the point of view

636
00:29:34,280 --> 00:29:37,080
Speaker 11: of critical acclaim, I mean, Disney has really really done

637
00:29:37,160 --> 00:29:40,280
Speaker 11: well with that acquisition because it's gotten them like a

638
00:29:40,280 --> 00:29:44,120
Speaker 11: lot of critical accolades and some commercial successes as well.

639
00:29:44,400 --> 00:29:46,080
Speaker 6: So I want to go back to your point that

640
00:29:46,520 --> 00:29:50,800
Speaker 6: theatrical releases are back, old media is back. What kind

641
00:29:50,800 --> 00:29:52,360
Speaker 6: of legs do you see on this trend? And I

642
00:29:52,400 --> 00:29:55,440
Speaker 6: say this as a massive movie buff, but I have

643
00:29:55,640 --> 00:29:58,320
Speaker 6: yet to really fully return to the cinema. I think

644
00:29:58,320 --> 00:30:01,680
Speaker 6: the last one I saw was Mission impossib because it's.

645
00:30:01,560 --> 00:30:03,120
Speaker 8: Just, you know, there's a lot of hassle.

646
00:30:03,360 --> 00:30:05,600
Speaker 3: Yeah, I mean it's a fair point. I mean I'm

647
00:30:05,640 --> 00:30:06,720
Speaker 3: not that far from you either.

648
00:30:07,840 --> 00:30:08,880
Speaker 8: So what absolutely is?

649
00:30:09,040 --> 00:30:10,800
Speaker 6: Oh yeah, so sorry, yeah, So what's your take are

650
00:30:10,960 --> 00:30:11,920
Speaker 6: is the pandemic over?

651
00:30:12,160 --> 00:30:14,080
Speaker 8: Is it all back? What's the story here?

652
00:30:15,240 --> 00:30:17,080
Speaker 11: It's been a bit of a both a demand and

653
00:30:17,080 --> 00:30:21,120
Speaker 11: the supply problem. So you know what has happened. Now,

654
00:30:21,240 --> 00:30:24,120
Speaker 11: we did see somewhat of a decent recovery. I would

655
00:30:24,160 --> 00:30:27,760
Speaker 11: say in twenty twenty three, we saw box office getting

656
00:30:27,800 --> 00:30:31,920
Speaker 11: back to nine billion dollars, which is still not equal

657
00:30:31,960 --> 00:30:35,040
Speaker 11: to pre pandemic levels. We're still about twenty percent short.

658
00:30:35,880 --> 00:30:38,200
Speaker 11: There's good news and bad news. The bad news is

659
00:30:38,240 --> 00:30:40,400
Speaker 11: twenty twenty four is not going to be better than

660
00:30:40,400 --> 00:30:44,960
Speaker 11: twenty twenty three. And the reason is the Hollywood strikes,

661
00:30:45,040 --> 00:30:47,440
Speaker 11: you know, those the actors strike as well as the

662
00:30:47,440 --> 00:30:50,960
Speaker 11: writer's strike, kind of created a lot of holes now

663
00:30:51,080 --> 00:30:53,560
Speaker 11: in the in the calendar. They pushed out a lot

664
00:30:53,600 --> 00:30:56,520
Speaker 11: of the big releases that were originally slated for twenty

665
00:30:56,520 --> 00:30:58,440
Speaker 11: twenty four to twenty twenty five. That's going to shave

666
00:30:58,480 --> 00:31:02,200
Speaker 11: off roughly two billion dollars from the box office. So

667
00:31:02,200 --> 00:31:04,120
Speaker 11: we're actually going to see twenty twenty four come in

668
00:31:04,360 --> 00:31:07,800
Speaker 11: much lighter than twenty twenty three. But the good news

669
00:31:07,880 --> 00:31:10,560
Speaker 11: is that twenty twenty five is everybody's expecting it to

670
00:31:10,640 --> 00:31:13,360
Speaker 11: kind of be this blockbuster or where we will see,

671
00:31:13,560 --> 00:31:16,280
Speaker 11: you know, box office kind of really get back hopefully

672
00:31:16,760 --> 00:31:19,680
Speaker 11: to those pre pandemic levels at about ten billion or so.

673
00:31:20,000 --> 00:31:23,120
Speaker 11: But I think generally the takeaway agen was that, you know,

674
00:31:23,600 --> 00:31:27,000
Speaker 11: studios definitely want to make that commitment to theatrical because

675
00:31:27,000 --> 00:31:30,200
Speaker 11: back in the day, especially when COVID was rampant, I mean,

676
00:31:30,200 --> 00:31:32,360
Speaker 11: there was this big question about whether we would, you know,

677
00:31:32,440 --> 00:31:34,120
Speaker 11: with everybody kind of doing the day and date at

678
00:31:34,120 --> 00:31:36,160
Speaker 11: that point of time, there was this big question about

679
00:31:36,200 --> 00:31:37,760
Speaker 11: whether everything was going to move to streaming.

680
00:31:37,760 --> 00:31:39,360
Speaker 8: And I think that's definitely not the case.

681
00:31:40,000 --> 00:31:42,240
Speaker 3: If you didn't have a job as senior US media

682
00:31:42,240 --> 00:31:45,800
Speaker 3: analysts for Bloomberg Intelligence, would you have watched the askers,

683
00:31:46,200 --> 00:31:46,680
Speaker 3: I would have.

684
00:31:46,880 --> 00:31:48,400
Speaker 8: I definitely would have always watched it.

685
00:31:48,440 --> 00:31:49,800
Speaker 3: Yeah, Okay, good, all right, And I just want to

686
00:31:49,840 --> 00:31:52,960
Speaker 3: get that clear. It's not just because it's your job. Okay,

687
00:31:53,000 --> 00:31:54,640
Speaker 3: let's talk about the elephant in the room, and that

688
00:31:54,680 --> 00:31:57,200
Speaker 3: elephant is very large in the form of Paramount Plus.

689
00:31:57,680 --> 00:32:00,480
Speaker 3: Any updates on this, any sort of insight, any sort

690
00:32:00,520 --> 00:32:02,320
Speaker 3: of what's next now that has mightbe.

691
00:32:02,200 --> 00:32:07,520
Speaker 11: Changed, Nothing really has changed. So you know, we've had

692
00:32:07,560 --> 00:32:10,600
Speaker 11: management kind of speak on multiple occasions. All that they've

693
00:32:10,600 --> 00:32:15,280
Speaker 11: said is they're kind of evaluating all possible offers, which

694
00:32:15,320 --> 00:32:18,520
Speaker 11: seem to be kind of dwindling. Actually, we had, you know,

695
00:32:18,800 --> 00:32:23,000
Speaker 11: multiple rumors, I would say swirling about a few weeks ago,

696
00:32:23,080 --> 00:32:26,000
Speaker 11: but really nothing Alex at this point of time. The studio,

697
00:32:26,040 --> 00:32:27,800
Speaker 11: of course, is still very much in play. We had

698
00:32:27,800 --> 00:32:30,240
Speaker 11: some news about Paramount kind of disposing off some of

699
00:32:30,280 --> 00:32:32,520
Speaker 11: their or wanting to dispose off some of their non

700
00:32:32,560 --> 00:32:36,240
Speaker 11: core assets, their Indian operations, if you will. So they're

701
00:32:36,280 --> 00:32:39,680
Speaker 11: definitely looking ready or getting ready for a sale. I

702
00:32:39,720 --> 00:32:41,560
Speaker 11: just don't know when or how it's going to happen.

703
00:32:42,400 --> 00:32:42,560
Speaker 10: Now.

704
00:32:42,600 --> 00:32:44,440
Speaker 6: Can we go back to the streamers a little bit

705
00:32:44,440 --> 00:32:46,240
Speaker 6: because there is a question that I wanted to ask you.

706
00:32:46,280 --> 00:32:49,400
Speaker 6: I mean, we had Netflix upgraded by Oppenheimer today or

707
00:32:49,440 --> 00:32:52,920
Speaker 6: their target the price target was raised at Oppenheimer today,

708
00:32:53,120 --> 00:32:55,719
Speaker 6: And this is taking a look at trends and user growth.

709
00:32:56,160 --> 00:33:01,480
Speaker 6: But you know, Netflix really raised their their costs recently

710
00:33:01,640 --> 00:33:03,960
Speaker 6: and then that you know, they managed to survive that

711
00:33:04,120 --> 00:33:08,000
Speaker 6: and subscriptions held up. How do you see that progressing

712
00:33:08,200 --> 00:33:10,400
Speaker 6: over the course of the year, especially if we have

713
00:33:11,040 --> 00:33:12,760
Speaker 6: a slower economy.

714
00:33:13,800 --> 00:33:16,360
Speaker 11: So I think at this point, jen Netflix has kind

715
00:33:16,360 --> 00:33:19,560
Speaker 11: of really established itself as the dominant streaming platform. And

716
00:33:19,600 --> 00:33:21,280
Speaker 11: I just say that because you know, kind of when

717
00:33:21,280 --> 00:33:23,120
Speaker 11: you think about you just go home every night and

718
00:33:23,160 --> 00:33:25,680
Speaker 11: you think about what do I want to watch. I mean,

719
00:33:25,720 --> 00:33:28,600
Speaker 11: Netflix has kind of almost become this habit right now,

720
00:33:29,080 --> 00:33:31,880
Speaker 11: and so people naturally kind of gravitate towards it, and

721
00:33:31,960 --> 00:33:34,960
Speaker 11: so I think that gives them immense pricing power. So

722
00:33:35,000 --> 00:33:37,880
Speaker 11: will they be able to raise prices in the future. Absolutely,

723
00:33:37,960 --> 00:33:40,880
Speaker 11: Do they have more growth levers to pull? Absolutely? They

724
00:33:40,960 --> 00:33:43,840
Speaker 11: you know, advertising is still a very very small business

725
00:33:43,840 --> 00:33:46,160
Speaker 11: for them, but they're looking to make it bigger and bigger.

726
00:33:46,680 --> 00:33:48,280
Speaker 11: You know, we just I don't know if you can

727
00:33:48,360 --> 00:33:51,360
Speaker 11: if you guys watched there was this exhibition tennis match

728
00:33:51,400 --> 00:33:54,960
Speaker 11: between Nadal and Alcaraz just a few days ago, and

729
00:33:55,000 --> 00:33:57,120
Speaker 11: now they have this big fight that's coming up between

730
00:33:57,120 --> 00:34:00,000
Speaker 11: Mike Tyson and Jake Paul. So they are doing more,

731
00:34:00,040 --> 00:34:02,080
Speaker 11: more and more to get into kind of you know,

732
00:34:02,240 --> 00:34:06,239
Speaker 11: live events. You know, obviously we know all of the

733
00:34:06,320 --> 00:34:10,080
Speaker 11: WWE content, the raw content is coming starting January twenty

734
00:34:10,120 --> 00:34:12,840
Speaker 11: twenty five, so they're branching out into different things and

735
00:34:12,880 --> 00:34:15,480
Speaker 11: the whole idea there is to kind of add more content,

736
00:34:15,600 --> 00:34:19,080
Speaker 11: more breadth, more depth, to give them more pricing powers.

737
00:34:19,120 --> 00:34:21,680
Speaker 11: So yes, I absolutely think that you know, they can

738
00:34:21,680 --> 00:34:23,680
Speaker 11: grow both subscriptions those worse revenue.

739
00:34:24,360 --> 00:34:26,919
Speaker 3: Really yeah, I forgot about that that Tyson fight. Also,

740
00:34:26,960 --> 00:34:29,040
Speaker 3: are those things less expensive to make? I man, you

741
00:34:29,040 --> 00:34:30,839
Speaker 3: have probably to pay them a lot, but versus like

742
00:34:30,960 --> 00:34:31,920
Speaker 3: a series.

743
00:34:33,000 --> 00:34:34,600
Speaker 8: But almost equal.

744
00:34:34,760 --> 00:34:37,120
Speaker 11: It would be like one of your big budgets series

745
00:34:37,120 --> 00:34:39,040
Speaker 11: because I think they're paying about three hundred million for

746
00:34:39,160 --> 00:34:43,000
Speaker 11: for the fight, so roughly equal to maybe like a

747
00:34:43,000 --> 00:34:44,040
Speaker 11: big stranger things.

748
00:34:44,320 --> 00:34:45,839
Speaker 3: Okay, all right, fair enough. I was gonna say, oh,

749
00:34:45,840 --> 00:34:47,759
Speaker 3: maybe the ROI on that is a little better, but

750
00:34:47,800 --> 00:34:51,640
Speaker 3: maybe that's not true. What's your go to jen streamer?

751
00:34:52,360 --> 00:34:52,520
Speaker 10: Well?

752
00:34:52,520 --> 00:34:54,120
Speaker 6: Actually, now, weirdly enough, it's Hulu.

753
00:34:54,719 --> 00:34:55,399
Speaker 8: Huh. Yeah.

754
00:34:55,440 --> 00:34:57,960
Speaker 6: We were obsessed with the Rookie and so I binge

755
00:34:57,960 --> 00:35:00,920
Speaker 6: watched that whole thing, which is strange. But now we're

756
00:35:00,960 --> 00:35:04,279
Speaker 6: watching Showgun and we're really just taken to that.

757
00:35:04,840 --> 00:35:08,400
Speaker 8: It's what we're gon is Showgun, the James Leavell novel.

758
00:35:08,520 --> 00:35:12,359
Speaker 6: They've redone it. We just watched the first episode lesson

759
00:35:12,440 --> 00:35:12,960
Speaker 6: it's very good.

760
00:35:13,400 --> 00:35:16,120
Speaker 3: Okay, But but you're not doing that, Tucker. You're you're

761
00:35:16,160 --> 00:35:17,960
Speaker 3: reading some kind of serie books on.

762
00:35:18,239 --> 00:35:21,320
Speaker 7: Yeah, it's a thing about some you can't judge.

763
00:35:21,080 --> 00:35:24,040
Speaker 3: Anything for I'm just like, what are you watching?

764
00:35:24,280 --> 00:35:28,120
Speaker 7: No, I'm not watching anything. I'm trying to finish a

765
00:35:28,560 --> 00:35:31,600
Speaker 7: twelve hundred page book with type about that big?

766
00:35:31,760 --> 00:35:32,879
Speaker 8: So what book?

767
00:35:32,920 --> 00:35:33,480
Speaker 6: Tell us?

768
00:35:33,640 --> 00:35:36,799
Speaker 7: It's been on my shelf for thirty years, literally, I

769
00:35:36,880 --> 00:35:39,759
Speaker 7: kid you not. And I finally like, I never read this.

770
00:35:39,840 --> 00:35:43,000
Speaker 7: I got to pick it up the Power Broker, Oh,

771
00:35:43,160 --> 00:35:46,040
Speaker 7: Robert Carroll, and it's just like one's a Pulitzer prize

772
00:35:46,080 --> 00:35:48,560
Speaker 7: back in the seventies, and it's just what a tour

773
00:35:48,640 --> 00:35:51,800
Speaker 7: to force. It's just like and if you're a New Yorker,

774
00:35:52,040 --> 00:35:55,000
Speaker 7: it is your duty to read this book. Okay, I

775
00:35:55,000 --> 00:35:57,279
Speaker 7: don't care if it's twelve hundred pages. You have to

776
00:35:57,320 --> 00:35:57,560
Speaker 7: do it.

777
00:35:58,080 --> 00:35:59,719
Speaker 6: You know, we saw the play that Ray Fine was

778
00:35:59,760 --> 00:36:00,799
Speaker 6: in it. It was fantastic.

779
00:36:00,880 --> 00:36:02,560
Speaker 7: Oh really yeah no, I mean it's right.

780
00:36:02,440 --> 00:36:04,960
Speaker 3: Fine, so that makes sense. No, I'm reading all the

781
00:36:04,960 --> 00:36:07,759
Speaker 3: reach your books. It's like Candy, I can just read

782
00:36:07,840 --> 00:36:09,160
Speaker 3: like one an hour on the train.

783
00:36:09,200 --> 00:36:10,520
Speaker 7: Well, what's speech perfect?

784
00:36:10,640 --> 00:36:13,040
Speaker 3: It's perfect. It's it's Alex every day reading, all right.

785
00:36:13,040 --> 00:36:16,520
Speaker 3: Get the thanks a lot, Eitha Manganathan no Bloomberg Intelligence,

786
00:36:16,520 --> 00:36:18,720
Speaker 3: a senior US media analyst, and thank you for watching

787
00:36:18,760 --> 00:36:20,840
Speaker 3: the Oscars, and thank you for saying I am just

788
00:36:20,920 --> 00:36:23,920
Speaker 3: Ken is brilliant, because it was and everyone should go

789
00:36:24,000 --> 00:36:26,200
Speaker 3: and watch it. Particularly John Tucker wants to.

790
00:36:26,280 --> 00:36:28,040
Speaker 7: Be well, it's over. I am not going to watch it.

791
00:36:28,800 --> 00:36:29,800
Speaker 3: It's called internet.

792
00:36:29,880 --> 00:36:31,240
Speaker 7: All right, this is Berg.

793
00:36:34,520 --> 00:36:38,400
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

794
00:36:38,480 --> 00:36:42,000
Speaker 2: weekdays at ten am Eastern on applecar Play and Android

795
00:36:42,040 --> 00:36:45,200
Speaker 2: Auto with a Bloomberg business. You can also listen live

796
00:36:45,280 --> 00:36:48,480
Speaker 2: on Amazon Alexa from our flagship New York station. Just

797
00:36:48,520 --> 00:36:51,880
Speaker 2: say Alexa play Bloomberg eleven thirty.

798
00:36:52,520 --> 00:36:54,839
Speaker 3: All right, talking about CPI for tomorrow, we got the

799
00:36:55,040 --> 00:36:57,799
Speaker 3: New York Fed inflation expectations coming in for one year

800
00:36:57,880 --> 00:37:00,279
Speaker 3: unchanged right up. For the three year they rose to

801
00:37:00,320 --> 00:37:02,360
Speaker 3: two point seven percent. For the five year rose to

802
00:37:02,400 --> 00:37:05,040
Speaker 3: two point nine percent. So let's get the set up

803
00:37:05,080 --> 00:37:08,520
Speaker 3: then for tomorrow. Adam Kon's is chief portfolio manager Winthrope

804
00:37:08,560 --> 00:37:12,360
Speaker 3: Capital Management. He joins us from Innneapolis, Indiana. Were you

805
00:37:12,440 --> 00:37:14,160
Speaker 3: up late watching the oscars.

806
00:37:15,239 --> 00:37:15,799
Speaker 10: As I play?

807
00:37:15,880 --> 00:37:18,799
Speaker 12: But not because of that? Got two kids they didn't

808
00:37:18,840 --> 00:37:19,560
Speaker 12: want to fall asleep.

809
00:37:19,920 --> 00:37:21,920
Speaker 3: Oh okay, fair enough, so no oscars for you. Just

810
00:37:21,960 --> 00:37:24,799
Speaker 3: to be clear, Yeah, I'm really bad.

811
00:37:25,000 --> 00:37:26,440
Speaker 6: Really, you're striking out today.

812
00:37:26,480 --> 00:37:28,160
Speaker 3: This is toughly. We should do the whole theme for

813
00:37:28,200 --> 00:37:30,080
Speaker 3: the whole week this way and just like, really get

814
00:37:30,080 --> 00:37:32,440
Speaker 3: a good read on who watches what all right, Adam?

815
00:37:33,040 --> 00:37:36,400
Speaker 3: In the market CPI tomorrow? Are we are we selling

816
00:37:36,400 --> 00:37:37,799
Speaker 3: a little bit in the front end because of that?

817
00:37:37,920 --> 00:37:40,399
Speaker 3: Is that what we're seeing a little bit? Yeah?

818
00:37:40,680 --> 00:37:44,000
Speaker 12: I think, you know, Unfortunately, we've gotten to this place

819
00:37:44,040 --> 00:37:48,440
Speaker 12: where the inflation prints and anything that's going to affect

820
00:37:48,480 --> 00:37:51,759
Speaker 12: the FED is the primary driver of market. So I

821
00:37:51,760 --> 00:37:53,200
Speaker 12: think we're going to continue to see that through the

822
00:37:53,239 --> 00:37:57,480
Speaker 12: rest of twenty twenty four. Expectations here really, you know,

823
00:37:57,600 --> 00:38:00,840
Speaker 12: right at three point eight, I think we're going to

824
00:38:00,920 --> 00:38:03,080
Speaker 12: actually see this come in a little bit below that.

825
00:38:03,560 --> 00:38:06,400
Speaker 12: I think there's gonna be a surprise out of the

826
00:38:05,719 --> 00:38:10,279
Speaker 12: service sector. We have already seen used car prices start

827
00:38:10,320 --> 00:38:12,759
Speaker 12: to fall off as well, so that we'll play a role.

828
00:38:13,440 --> 00:38:18,480
Speaker 12: So we're actually thinking we'll see a slight undertick from

829
00:38:18,560 --> 00:38:23,440
Speaker 12: the expectations right now on both core and non core CPI.

830
00:38:24,360 --> 00:38:27,560
Speaker 6: If the print comes in as you expect a little

831
00:38:27,560 --> 00:38:30,840
Speaker 6: bit of an undertick, how our markets position relative to that,

832
00:38:30,960 --> 00:38:33,839
Speaker 6: Is there going to be a setup for some serious damage?

833
00:38:35,239 --> 00:38:38,440
Speaker 12: Well, you know, I think it depends on how you're

834
00:38:38,440 --> 00:38:41,920
Speaker 12: playing it. I do think you'll start to see interest

835
00:38:42,000 --> 00:38:45,040
Speaker 12: rates on the short end come down significantly. But yeah,

836
00:38:45,040 --> 00:38:47,239
Speaker 12: I think when we're talking about equity markets, that would

837
00:38:47,239 --> 00:38:49,719
Speaker 12: be a sign that things are slowing down. I think

838
00:38:50,120 --> 00:38:52,240
Speaker 12: a lot of people are kind of overlooking the impact

839
00:38:52,280 --> 00:38:54,520
Speaker 12: that the slowdown in China is going to have on

840
00:38:54,920 --> 00:38:58,880
Speaker 12: not just inflation, but just overall kind of consumption demand globally.

841
00:38:59,000 --> 00:39:01,840
Speaker 12: So that's really what we're thinking is going to drive

842
00:39:03,280 --> 00:39:06,520
Speaker 12: this downtick, because this is just going to start the snowball.

843
00:39:07,080 --> 00:39:09,640
Speaker 12: Like I said, as you see these big economies, demand

844
00:39:09,800 --> 00:39:14,120
Speaker 12: is notably slowing down. US has been resilient, but you

845
00:39:14,120 --> 00:39:16,600
Speaker 12: know it can't outlive this forever.

846
00:39:17,040 --> 00:39:20,680
Speaker 3: So you think then that we won't get a rotation,

847
00:39:21,239 --> 00:39:23,640
Speaker 3: a solid rotation to other assets that will help prop

848
00:39:23,719 --> 00:39:27,759
Speaker 3: up the market. That doesn't seem to be where you're at, No,

849
00:39:28,040 --> 00:39:28,440
Speaker 3: I don't.

850
00:39:28,480 --> 00:39:30,719
Speaker 12: I think what you'll start to see is as this

851
00:39:31,000 --> 00:39:33,759
Speaker 12: kind of fear starts to pick up. Obviously, there was

852
00:39:33,760 --> 00:39:36,920
Speaker 12: a lot of fear last year that just didn't materialize,

853
00:39:37,200 --> 00:39:39,920
Speaker 12: and so some complacency move back into the market. But

854
00:39:39,960 --> 00:39:42,640
Speaker 12: if we start to see that shift in any direction

855
00:39:42,719 --> 00:39:45,560
Speaker 12: towards back towards the fear, I think what you'll see

856
00:39:45,640 --> 00:39:48,120
Speaker 12: is just more of a risk off and you'll just

857
00:39:48,200 --> 00:39:50,040
Speaker 12: kind of start to see, you know, the treasury market

858
00:39:50,400 --> 00:39:53,480
Speaker 12: will rally, but everything else, I think we'll have a tough,

859
00:39:53,960 --> 00:39:54,879
Speaker 12: tough road ahead of it.

860
00:39:55,120 --> 00:39:58,319
Speaker 6: So what do you think then about overall corporate valuations.

861
00:39:58,400 --> 00:40:00,919
Speaker 6: Are we in bubble territory? Then, if you know there's

862
00:40:00,960 --> 00:40:05,000
Speaker 6: this expectation for a little bit of a softness, No.

863
00:40:05,120 --> 00:40:05,600
Speaker 4: I don't.

864
00:40:05,719 --> 00:40:09,319
Speaker 12: I mean, I think our valuation's high, yes, but I

865
00:40:09,360 --> 00:40:13,279
Speaker 12: think largely that can be offset by margin expansion. I

866
00:40:13,320 --> 00:40:16,279
Speaker 12: think that's going to push us through this cycle, make

867
00:40:16,360 --> 00:40:19,240
Speaker 12: it this cycle, at least the business cycle i'm referring

868
00:40:19,239 --> 00:40:23,279
Speaker 12: to slightly more extended than what we've been used to.

869
00:40:23,360 --> 00:40:24,800
Speaker 12: And that's why we don't think there's really going to

870
00:40:24,880 --> 00:40:29,879
Speaker 12: be any significant softening or a recession in twenty twenty four.

871
00:40:30,160 --> 00:40:32,440
Speaker 12: It might see something in twenty twenty five. I think

872
00:40:32,480 --> 00:40:34,839
Speaker 12: it really just depends on FED policy and how tight

873
00:40:34,880 --> 00:40:38,480
Speaker 12: they keep things and how long they do that. But no,

874
00:40:38,760 --> 00:40:42,359
Speaker 12: I think right now valuations are for the most part

875
00:40:42,440 --> 00:40:45,160
Speaker 12: fairly valued. There are absolutely stocks that are you could

876
00:40:45,160 --> 00:40:47,799
Speaker 12: consider bubble territory, but markets as a whole, no, not

877
00:40:47,880 --> 00:40:48,200
Speaker 12: at all.

878
00:40:48,560 --> 00:40:50,840
Speaker 3: Okay, So in the scenario that you're laying out what

879
00:40:50,920 --> 00:40:53,560
Speaker 3: happens with the dollar, Like you might have Treasury's rally,

880
00:40:53,600 --> 00:40:55,440
Speaker 3: But what does the dollar do in that scenario.

881
00:40:57,600 --> 00:40:59,880
Speaker 12: Honestly, that's a tough one because you know, it's a

882
00:41:00,000 --> 00:41:03,719
Speaker 12: relative game. And at the same time, as maybe the

883
00:41:03,800 --> 00:41:07,560
Speaker 12: FED is forced to start to loosen their policy, everywhere

884
00:41:07,600 --> 00:41:09,680
Speaker 12: else in the world is going to be way looser

885
00:41:09,719 --> 00:41:12,239
Speaker 12: and have a head start on us. You're already you know,

886
00:41:12,480 --> 00:41:14,719
Speaker 12: starting to see where China is going to have to

887
00:41:15,360 --> 00:41:18,640
Speaker 12: produce some significant stimulus measures in order to prop up

888
00:41:18,680 --> 00:41:21,800
Speaker 12: that economy. Europe is really no different at this point.

889
00:41:21,880 --> 00:41:24,560
Speaker 12: So I think on a relative basis, I think the

890
00:41:24,640 --> 00:41:28,120
Speaker 12: US dollar remains fairly strong, which I think will make

891
00:41:28,200 --> 00:41:30,600
Speaker 12: it difficult to invest in emergency markets as a whole

892
00:41:31,400 --> 00:41:35,279
Speaker 12: and could weigh down other countries. So I do think

893
00:41:35,640 --> 00:41:40,080
Speaker 12: the US dollars maintains its strength. It might weaken slightly,

894
00:41:40,160 --> 00:41:42,440
Speaker 12: but by no means do I see it falling off

895
00:41:42,440 --> 00:41:45,400
Speaker 12: a cliff like we've seen in past recessions.

896
00:41:46,040 --> 00:41:48,880
Speaker 6: So where does this leave the progress for FED raitcuts.

897
00:41:51,080 --> 00:41:56,320
Speaker 12: Well, you know, obviously the market's expectation has changed significantly

898
00:41:56,360 --> 00:41:59,120
Speaker 12: as this year, just in three months has come along,

899
00:41:59,360 --> 00:42:02,840
Speaker 12: you know, pricing in six cuts to begin with and

900
00:42:03,239 --> 00:42:06,919
Speaker 12: now we're well below that, you approaching three to two.

901
00:42:07,800 --> 00:42:09,920
Speaker 12: From our standpoint, we do think the Fed's going to

902
00:42:09,960 --> 00:42:14,640
Speaker 12: be a lot slower to react through this, through this

903
00:42:15,200 --> 00:42:18,759
Speaker 12: monetary cycle when you look at you know how they

904
00:42:18,880 --> 00:42:23,799
Speaker 12: enter this with very slow changes into increasing interest rates

905
00:42:23,920 --> 00:42:27,359
Speaker 12: using the transitory narrative for far too long. I think

906
00:42:27,400 --> 00:42:29,120
Speaker 12: they're going to do the same thing on the back end,

907
00:42:29,480 --> 00:42:31,600
Speaker 12: is that they're going to hold tight here and it

908
00:42:31,760 --> 00:42:35,640
Speaker 12: really weight to decrease interest rates until there are some

909
00:42:35,800 --> 00:42:38,560
Speaker 12: serious cracks in the economy that they can point to

910
00:42:38,960 --> 00:42:42,160
Speaker 12: and all their data set both hard and soft right now,

911
00:42:42,200 --> 00:42:47,080
Speaker 12: I think that what they're the rhetoric is that there's

912
00:42:47,080 --> 00:42:49,400
Speaker 12: this idea that the economy is softening, but there's just

913
00:42:49,400 --> 00:42:52,200
Speaker 12: not enough data to get the Fed to actually act.

914
00:42:52,239 --> 00:42:55,360
Speaker 12: And so until you see those data points really screaming

915
00:42:55,360 --> 00:42:57,080
Speaker 12: that the economy is slowing down, I just don't think

916
00:42:57,120 --> 00:42:58,719
Speaker 12: the Fed's going to cut and I don't know if

917
00:42:58,760 --> 00:43:00,000
Speaker 12: they cut it all in twenty twenty four.

918
00:43:00,440 --> 00:43:03,160
Speaker 3: Oh okay, So joining the Torus and slag Apollo camp

919
00:43:03,200 --> 00:43:07,560
Speaker 3: that maybe no cuts, which the facto that would kind

920
00:43:07,560 --> 00:43:10,480
Speaker 3: of be a hike in essence, what would that do

921
00:43:10,520 --> 00:43:11,560
Speaker 3: you think to the economy.

922
00:43:13,120 --> 00:43:15,719
Speaker 12: Well, I think honestly, you know, if they don't cut

923
00:43:15,719 --> 00:43:19,400
Speaker 12: it all this year and they keep things tight for longer,

924
00:43:19,440 --> 00:43:22,200
Speaker 12: I think that that is gonna that could lead us

925
00:43:22,200 --> 00:43:26,640
Speaker 12: into a harsh disinflationary period where you know, they overshoot

926
00:43:26,640 --> 00:43:30,240
Speaker 12: the two percent inflation target and suddenly we we're wondering

927
00:43:30,280 --> 00:43:33,719
Speaker 12: what happens if we're seeing you know, Japanese style deflation.

928
00:43:33,760 --> 00:43:35,120
Speaker 7: I think that's a low probability.

929
00:43:35,160 --> 00:43:38,000
Speaker 12: But if they stay too tight for too long, that

930
00:43:38,200 --> 00:43:43,360
Speaker 12: is the increasing probability of events that it's a harsher

931
00:43:43,400 --> 00:43:46,680
Speaker 12: thing for the economy to deal with deflation than some

932
00:43:46,800 --> 00:43:47,640
Speaker 12: slight inflation.

933
00:43:48,280 --> 00:43:50,759
Speaker 3: All Right, thanks a lot, really appreciate Adam Kuon's chief

934
00:43:50,800 --> 00:43:54,960
Speaker 3: portfolio manager at Winthrop Capital Management. That's super interesting. If

935
00:43:54,960 --> 00:43:56,680
Speaker 3: they have to wait, and the idea is the longer

936
00:43:56,719 --> 00:44:00,319
Speaker 3: you wait to cut than the worse the circumstance will

937
00:44:00,360 --> 00:44:01,120
Speaker 3: wind up being.

938
00:44:01,760 --> 00:44:06,239
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939
00:44:06,480 --> 00:44:09,680
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940
00:44:09,680 --> 00:44:13,239
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941
00:44:13,360 --> 00:44:16,799
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942
00:44:16,840 --> 00:44:20,000
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943
00:44:20,160 --> 00:44:21,760
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