Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanovik. We're here every day bringing
Speaker 1: you the latest news from the world of business and finance,
Speaker 1: plus technology, politics, economics, all harnessing the power of Business
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Speaker 1: Bloomberg Business Week at iTunes, SoundCloud, or Bloomberg dot Com.
Speaker 1: You can also listen to our radio show at two
Speaker 1: pm Eastern Time on Bloomberg Radio or watch us on
Speaker 1: YouTube search Bloomberg Global News. Well, a little bit earlier
Speaker 1: in our program, we spoke to Bloomberg news is Hannah
Speaker 1: Levitt and she talked about how Wall Street bonuses are
Speaker 1: poised to plunge following a slowdown of deals. We're also
Speaker 1: seeing a slowdown of deals when it comes to I
Speaker 1: P O s and when it comes to other M
Speaker 1: and A happening. We thought it would be great to
Speaker 1: check in with Amy Noyakis, who's the co founder and
Speaker 1: co c i O at the venture capital firm Anthemus.
Speaker 1: We've talked to her before about venture capital, of course,
Speaker 1: and also about supporting women in venture capital. Amy, it's
Speaker 1: good to have you with us. How are you. I'm good,
Speaker 1: I'm good. I'm tired. It's been a very crazy busy summer.
Speaker 1: Well what do you mean by that? How crazy busy
Speaker 1: in what sense? Well, you know, I think it's been
Speaker 1: an interesting time for venture capital. Um. You know, we've
Speaker 1: heard a lot about this sort of idea that might
Speaker 1: be a silent crash happening in DC, or that we're
Speaker 1: at the beginning of the end of VC as the
Speaker 1: market to dry it up. But you know, I'm telling
Speaker 1: you from my perspective, I'm not seeing it. Um. I mean,
Speaker 1: the current market environment has really put capital location decisions
Speaker 1: to the test, and I think people have made some
Speaker 1: big mistakes in the last couple of years. But the
Speaker 1: industry wide correction that we're seeing this year isn't a
Speaker 1: surprise to any of us who have been doing this
Speaker 1: for decades, nor is it affecting all companies are all
Speaker 1: investors in the same way. I think it's just simply
Speaker 1: a needed corrections. Right. For the last ten plush years,
Speaker 1: we've seen unprecedented amounts of capital shifting into venture capital,
Speaker 1: particularly in the tech sector, inspiring entrepreneurs and would be
Speaker 1: founders to build new digital companies that are challenging the
Speaker 1: old guard and most importantly, or makes a lot of sense.
Speaker 1: But the majority of these cases, the markets and the
Speaker 1: employees and the consumers these companies have reached a ton
Speaker 1: of benefits through this evolution. However, there are lots of
Speaker 1: founders and investors alike who have attempted to build companies
Speaker 1: that aren't solving real problems. They're not focusing on business fundamentals,
Speaker 1: and they're letting hubrists get the best of them. Right. So,
Speaker 1: while the global funding has slowed, there are still plenty
Speaker 1: of great companies growing, expanding and building, And there are
Speaker 1: still plenty of companies out there, and so I'm kind
Speaker 1: of feeling like, you know, the bigger issue is how
Speaker 1: many of these people that have kind of jumped into
Speaker 1: the game in the last sort of inning, so to speak,
Speaker 1: are really throwing things off right, Like, VC is hard
Speaker 1: and it's supposed to be. It's why the returns are
Speaker 1: so high. There's huge upside for investors that are finding
Speaker 1: and back in great companies. But the problem is, I
Speaker 1: think over the last couple of years, it's looked too
Speaker 1: easy and that's attracted a lot of folks frankly don't
Speaker 1: belong in the game. And now that it's gotten a
Speaker 1: little harder again, you've got to look a little harder
Speaker 1: for the good ideas. You've got to be smarter about
Speaker 1: the way you value these companies. It's the dumb money
Speaker 1: that's disappeared, and it's taken a lot of promising companies
Speaker 1: with it. And tell us give us some good ideas.
Speaker 1: Where are there still opportunities? Well, I listen on the
Speaker 1: investor side, I think there's a ton of opportunity in
Speaker 1: the early stage. Um, it's still very much a sweet spot.
Speaker 1: A lot of the market contraction that we've seen has
Speaker 1: been in the later stage. I'm personally biased because we're
Speaker 1: at antmestic fans of the of the early stage strategy.
Speaker 1: But I think that if you're a quality early stage
Speaker 1: investor and you're in it for the long haul, you'll
Speaker 1: navigate this correction incredibly well. Valuations are getting haircuts if
Speaker 1: they deserve. Deal flow in competition for capital is sort
Speaker 1: of flowing a bit, and investors at the early stage
Speaker 1: I think are well positioned. You know, you've got to
Speaker 1: focus on the fundamentals. You've got to stay from the
Speaker 1: away from the fluff Hubrist. A great company is a
Speaker 1: great company, and there's always space for great companies. Um.
Speaker 1: I'd say for the companies and the founders, they should
Speaker 1: probably take the advice that they should have heated years ago.
Speaker 1: Not all capitals the same. Pay attention to who's backing
Speaker 1: your company, and don't get swindled by a heavy valuation
Speaker 1: that you know you can't back up. I mean, we've
Speaker 1: seen so many examples of that. I don't want to
Speaker 1: say they were, you know, swindled, but we've seen a
Speaker 1: lot of down rounds, uh in the past few months. Amy, Yeah,
Speaker 1: and listen, that's that's not surprising, right. I Mean, the
Speaker 1: role on the purpose of a good venture capital capital
Speaker 1: investor hasn't changed. It is our job and should be
Speaker 1: our jard to deploy capital responsibly and help grow portfolio companies.
Speaker 1: That doesn't mean that there's a one size fits all
Speaker 1: approach to how we do that. And I think the
Speaker 1: biggest issue for me is that so many of these
Speaker 1: players have jumped in eyes closed with little to no
Speaker 1: experience and how to build and support a quality company
Speaker 1: as it grows. And these are the folks that have
Speaker 1: caused a lot of the pain in the market. Um.
Speaker 1: You know, I think some of the strategy is driven
Speaker 1: by hubris, and I don't think it's appropriate to write
Speaker 1: the entire sector off just because a large number of
Speaker 1: folks decided to jump into the defense naked before checking
Speaker 1: if there was water in the pool, right right, Hey, uh,
Speaker 1: we just have a minute left with you, Amy, but
Speaker 1: I want to get an update on the female Innovator's
Speaker 1: Lab that you recently launched. And because when we talk
Speaker 1: about venture capital, especially them in venture capital, we're talking
Speaker 1: like single digit percentage of venture capital goes to Winden
Speaker 1: each year. Yeah, it's still I'm you know, it's still
Speaker 1: an area that we spent a lot of our time
Speaker 1: on an anthemous and I think a big part of
Speaker 1: that is because it was how we were founded. Right.
Speaker 1: You know, I'm a woman founder of a company, and
Speaker 1: not only am I investor, but I'm somebody who started
Speaker 1: a company from scratch and watched how hard it was
Speaker 1: and difficult it was to raise capital to grow my company,
Speaker 1: and there weren't a lot of supporters around. Um So
Speaker 1: when we looked across the entirety of the fintech sector,
Speaker 1: we wanted to make sure, um that we were playing
Speaker 1: a very solid roll in in sort of putting our
Speaker 1: money where our mouth is. And and so we've been
Speaker 1: backing women founders in Europe in the US for a
Speaker 1: couple of years now specifically and what we call the
Speaker 1: earliest venture studio stage, money and ideas coming together at
Speaker 1: the very beginning and helping these women build their company.
Speaker 1: And I think it's a really great opportunity not only
Speaker 1: to see some fantastic businesses and help women, you know,
Speaker 1: get a leg up and grow, and also you know,
Speaker 1: as as we've sort of found it's making a huge difference,
Speaker 1: you know, I mean, I know that people say all
Speaker 1: the time that it's really hard to back women and
Speaker 1: people of color and venture and there are never enough.
Speaker 1: Reality is it's full right. We have Amy, we gotta
Speaker 1: we gotta leave it there. Amy naukis co foundering co
Speaker 1: c I O at Anthemus, joining us this afternoon on
Speaker 1: the phone from New York City. You're listening to Bloomberg Radio.
Speaker 1: This is Bloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes. Tim Stinovic on Bloomberg Radio. We got some
Speaker 1: breaking news the US just now declaring monkey pox a
Speaker 1: public health emergency that allows more funding to fight monkey pox,
Speaker 1: the Health and Human Services saying that more than six
Speaker 1: hundred thousand geneos monkey pox doses have been delivered two
Speaker 1: states thus far. We've got a perfect guest joining us
Speaker 1: on this right now. Dr G. G. Granvall, Senior Scholar
Speaker 1: at the Johns Hopkins Center for Health Security at the
Speaker 1: Bloomberg School of Public Health, the Johns Hopkins Bloomberg School
Speaker 1: Public Health. It is supported by Michael R. Bloomberg under
Speaker 1: of Bloomberg LP and Bloomberg Philanthropies. Dr Gronwald, Good to
Speaker 1: have you with us this afternoon, and really perfect timing
Speaker 1: for you to join us, because, as I mentioned just
Speaker 1: moments ago, the US has declared monkeypox a public health emergency.
Speaker 1: Apart from allowing more funding to fight this virus, what
Speaker 1: does this actually do? Yeah, this will help the federal
Speaker 1: government get more information from the states. So declaring it
Speaker 1: a public health emergency, the states will have reporting requirements,
Speaker 1: so the CDC will have a better idea of just
Speaker 1: how many cases there are, how many tests have been
Speaker 1: delivered or have been taken, and how many of the
Speaker 1: vaccines have been delivered, so it will make it a
Speaker 1: lot easier to get a better picture nationwide of the
Speaker 1: monkey pox epidemic. And what have we learned about monkey
Speaker 1: pox so far in terms of how to protect ourselves
Speaker 1: from getting it, what to do if you do get
Speaker 1: monkey pox, because I feel like it took a lot
Speaker 1: of people by surprisers. Absolutely, I think, at least speaking innecdotally,
Speaker 1: some COVID fatigue when it comes to sort of managing
Speaker 1: health risks there. Yeah, I mean we're all tired of
Speaker 1: infectious diseases, but um, but there are a lot of them,
Speaker 1: and and unfortunately this is the latest one that we're
Speaker 1: dealing with. UM. We've known about monkey pops being emerging
Speaker 1: disease for some time. UM, how it when it appears
Speaker 1: this is you know, this is a surprise. Um, but
Speaker 1: you know it's not a surprise. Uh. So we know
Speaker 1: that we could have been or should have been better
Speaker 1: prepared for it, and we have to catch up, um
Speaker 1: learning more about it. UM. So we know that it
Speaker 1: has spread very differently than COVID, So you shouldn't be
Speaker 1: as concerned about aerosol transmission, so you don't have to
Speaker 1: worry about being in the same room as somebody, um
Speaker 1: who has monkey pops, unless you're maybe delivering care to them,
Speaker 1: in which case you should take simplecautions. But um, for
Speaker 1: most transmission is through close contact, and that's how most
Speaker 1: of the transmission has occurred so far. Okay, let's shift
Speaker 1: gears because we got a couple of minutes left, and
Speaker 1: I want to get an update from you on how
Speaker 1: we're thinking about COVID right now. Uh, Dr Gronvill. We're
Speaker 1: going to be heading back to school. Wow, already in
Speaker 1: the next few weeks. It's pretty remarkable to see. I know,
Speaker 1: time flies, It certainly does. Uh. How are you thinking
Speaker 1: about this when when it comes to kids in school,
Speaker 1: Because we have a tool for kids under five right
Speaker 1: now that we didn't have just a few months ago.
Speaker 1: My son was able to get his first shot recently
Speaker 1: of the Maderna vaccine, so I think that means that
Speaker 1: he won't have to wear a mask when he's fully
Speaker 1: vaccinated at school, which is pretty exciting. Yeah. I think
Speaker 1: it's going to really depend on the population. UM. You know,
Speaker 1: some schools may decide to have masks for the first
Speaker 1: week or so as UM children are mixing from different places, UM,
Speaker 1: and and after maybe one round of testing has occurred.
Speaker 1: I'm sure that there will be different policies that have
Speaker 1: put into place in different places. But UM, but I
Speaker 1: think you know, having taking advantage of the vaccine if
Speaker 1: you can, it's really the best way to protect your
Speaker 1: child from UM severe disease. And UM we may not
Speaker 1: be able to escape and encounter with the virus, but um,
Speaker 1: but you can do one big thing to lessen your
Speaker 1: chances of any severe outcome, and that's getting vaccinated. UM.
Speaker 1: So when it comes to masks, UM, you know, those
Speaker 1: are very controversial, as we know, but they do work
Speaker 1: and so maybe in limited circumstances people can persuaded to
Speaker 1: use them. And also, portable hair air filters are a
Speaker 1: really good thing to have in classrooms. So you can
Speaker 1: build them yourselves. There's mechanisms to there's ways to build them.
Speaker 1: They're called Corsie Rosenthall boxes. It's a d I y
Speaker 1: approach that really is helpful. Or you can use federal
Speaker 1: funds to buy them. Okay, really helpful stuff. Um, Hey,
Speaker 1: we got thirty seconds left. Do we have to worry
Speaker 1: about another search happening in the fall when things start
Speaker 1: to get colder. UM, people have been looking for seasonality
Speaker 1: for a COVID for some time, and it's just been
Speaker 1: a sustained amount of transmission with new variants, so I
Speaker 1: you know, it could be. I'm not gonna second guest Insprus,
Speaker 1: except to say that that we have pretty high transmission
Speaker 1: as is and we don't need a search alright. G. G. Grandvall, Dr. G. G. Grandvall,
Speaker 1: Senior Scholar at the Johns Hopkins Center for Health Security
Speaker 1: at the Bloomberg School of Public Health, joining us on
Speaker 1: the phone from Baltimore, of course, the Johns Hopkins Bloomberg
Speaker 1: School of Public Health that is supported by Michael R. Bloomberg,
Speaker 1: founder of Bloomberg LP and Bloomberg Philanthropies. This is Bloomberg
Speaker 1: Business Week with Carol Masser and Bloomberg Quick Takes Tim
Speaker 1: Stinovic on Bloomberg Radio. Let's turn out to some of
Speaker 1: the crypto news that Tim teas. We've got a great guess.
Speaker 1: Olga Carey, if she's a crypto reporter for Bloomberg News.
Speaker 1: She joins us on the phone from Portland, Oregon. Olga,
Speaker 1: Let's start with micro strategy, because the big news there,
Speaker 1: of course, is Michael Sailor stepping down as chief executive officer.
Speaker 1: He's going to remain with the company. Of course, it
Speaker 1: was interesting the market reaction. You actually saw a surge
Speaker 1: in micro Stargy yesterday. Uh. This news, of course was
Speaker 1: coming on Tuesday. Olga, just walk us through on what
Speaker 1: the thinking around this company is right now, because in
Speaker 1: addition to its huge bitcoin buys, nominally it's a software maker. Absolutely,
Speaker 1: so it's interesting, it's a it's a large enterprise software company.
Speaker 1: And of course, in the last two years, Michael Saylor
Speaker 1: has also created a parallel bitcoin strategy, and supposedly now
Speaker 1: he's gonna become executive chairman and focus on strategy and uh,
Speaker 1: focus more on on the company's bitcoin strategy, while the
Speaker 1: incoming CEO will focus on the actual enterprise software business.
Speaker 1: And I think part of the reason the market like
Speaker 1: the news was because in the Ernies call, the company
Speaker 1: essentially hyped this idea that you know, we are a
Speaker 1: hundred percent behind bitcoin. We will continue with the strategy,
Speaker 1: even even though micro Strategy had an impairment charge of
Speaker 1: almost a million dollars in the second quarter because of
Speaker 1: the decline and the price of its bitcoin holdings. Alright, Olga,
Speaker 1: I gotta get from micro Strategy we had so much
Speaker 1: news to get to. Okay, so bear with me because
Speaker 1: I'm gonna jump around a little bit. Uh. The news
Speaker 1: that I saw this morning that really caught my eye
Speaker 1: was what's happening with coin base today. We saw black
Speaker 1: Rock teaming up with it, We saw platforms Well, look
Speaker 1: what it did to a company's stock. I don't know.
Speaker 1: I mean, Taylor made a good point on our samolcast earlier,
Speaker 1: which and I want to get your take on this,
Speaker 1: Olga is it seems I think by some sort of
Speaker 1: a legitimization right of this black Rock after all partnering
Speaker 1: with coin base, how do you read into it? Absolutely?
Speaker 1: You know, I talked with some institutional investors today who
Speaker 1: took this as a sort of major step and institutional
Speaker 1: adoption of crypto. And of course black Rock customers will
Speaker 1: now use a coin base to be able to track
Speaker 1: and manage their bitcoin holdings. It's a sort of at
Speaker 1: this point a very limited partnership related to only bitcoin.
Speaker 1: But you know, a lot of people think that a
Speaker 1: lot of the other firms on Wall Street that maybe
Speaker 1: have been fearful of stepping into crypt crypto will take
Speaker 1: this as a sign that, you know, maybe we should
Speaker 1: venture and now And Olga, I mean, I guess it's
Speaker 1: in terms of, you know, trying to justify the reaction
Speaker 1: that we saw on coin based shares, which was I
Speaker 1: think it was up as much as was this morning.
Speaker 1: It was crazy. I don't know if that was before
Speaker 1: the market open. I have to check. I'm gonna go check.
Speaker 1: We'll check on the senor. You asked the question terminal. Okay, okay,
Speaker 1: back to the question, so, Olga, I mean, it is
Speaker 1: interesting that black Rock didn't choose to sort of build
Speaker 1: its own sort of platform for this. It went with
Speaker 1: a crypto native company. Yeah. Absolutely, it's very interesting. And
Speaker 1: you know, back to your point of the coin based stock, Ali,
Speaker 1: I think part of it has been that coin Basis
Speaker 1: stock has been down so much. I mean, the company
Speaker 1: went public um a little over a year ago and
Speaker 1: pretty much the stock uh it increased a bit. Uh, well,
Speaker 1: it dipped and it increased a bit alone with crypto
Speaker 1: prices last full and then it's been basically dropping like
Speaker 1: a rock. So part of the enthusiasm might be due
Speaker 1: to the fact that it's just dropped so so low.
Speaker 1: And although we have just about a minute or so
Speaker 1: left left. But I am curious what the heck is
Speaker 1: going on with Salana. Yes, so Salana experience. Some of
Speaker 1: the Salana users all of a sudden have seen coins
Speaker 1: drained from the wallets, and I guess the investigation is
Speaker 1: still ongoing. Uh. All signs are pointing to prop jims
Speaker 1: with uh some wallets um that users have been using. Uh.
Speaker 1: You know, it's it's interesting uh in crypto as as
Speaker 1: as you know. Uh uh, it's just bugs. Oh, kinds
Speaker 1: of bugs abound, and you know, everything is being built
Speaker 1: so quickly that you know, uh, the stuff happens, and
Speaker 1: as a result, hackers are just being very active, and
Speaker 1: it seems like every day we hear of something being drained.
Speaker 1: It's certainly not necessarily good news for the people who
Speaker 1: are being hacked, but it keeps you busy, Olga, and
Speaker 1: we love it when you join us here on Bloomberg
Speaker 1: Business Week. Over career crypto reporter for Bloomberg News, she
Speaker 1: joins us on the phone from Portland, Oregon. The journal. Now,
Speaker 1: but you let me drive, Oh no, no, no no, no, honey, please,
Speaker 1: I'll do the vels I want to drive. It's the
Speaker 1: question that drives This is the drive to the globe
Speaker 1: on Bluebird Radio and it's the drive to the close.
Speaker 1: We got less than ten minutes to go here in
Speaker 1: the US equity market, and we've got a great voice
Speaker 1: joining us to help us understand what's going on with
Speaker 1: the markets, especially is this a bear market rally? Cole
Speaker 1: Smeade is the president and portfolio manager at Smeade at
Speaker 1: Capital Management. He joins us on the phone from Phoenix, Arizona.
Speaker 1: Col Cole, how are you this afternoon? Uh, we'll see
Speaker 1: in a lot of red in the oil patch right now,
Speaker 1: but knowing that's just part of the game when you
Speaker 1: want to own a business for a long time and
Speaker 1: get really wealthy. Okay, well let's start with oil because
Speaker 1: this is an area that you know, last time we spoke,
Speaker 1: you were really bullish on You think there's despite the
Speaker 1: fact that we're you know, pretty far from a barrel
Speaker 1: where we saw things just very recently now close to
Speaker 1: ninety Um, what's your outlook? Yeah? So I think what? Um?
Speaker 1: I think? What kind of is going on just in
Speaker 1: the interim, is you know, those stocks have moved up
Speaker 1: a lot lot um kind of the momentum crowd is
Speaker 1: kind of trying to figure out where to kind of
Speaker 1: you know, go play chips at the casino next, and
Speaker 1: so you I just see, I think you're seeing a
Speaker 1: lot of short term momentum disappear. But for people like us,
Speaker 1: what we're paying attention to is how much book value
Speaker 1: per share is growing in those businesses. So, for example,
Speaker 1: occidentally reported this week, Uh, we were looking at the numbers.
Speaker 1: Book value per share grew eleven point four percent in
Speaker 1: the quarter. Now, what did most that come off of
Speaker 1: was paying down debt inwards. The net worth grew because
Speaker 1: there's less liabilities to call the assets um. But that's
Speaker 1: coming from cash generation. And it's very tough to find
Speaker 1: businesses in the U stock market or in other markets
Speaker 1: like Canada and the oil patch that that produced that
Speaker 1: kind of book value per share growth. And I'm just
Speaker 1: so you know, Tim we I think that's exactly what
Speaker 1: buffets looking at because for years Berrture used to track
Speaker 1: their performance in book value growth against the essences under returns.
Speaker 1: Well cool, let's let's frow it out a little bit
Speaker 1: and talk about the index level and wrap it into
Speaker 1: what we've been hearing from just the parade of FED
Speaker 1: speakers that we've gotten this week, Because it feels like
Speaker 1: the FMC members have pushed back pretty strongly on the
Speaker 1: idea that, you know, perhaps they would slow down the
Speaker 1: pace of rate hikes. But then you look at the
Speaker 1: SMP five hundred, you look at the NASAC one hundred.
Speaker 1: We've seen a pretty big rally, especially yesterday. Of course
Speaker 1: today it's a little bit that's tepid, you could say,
Speaker 1: But I'm curious how you you marry those two stats together.
Speaker 1: Why does that make sense? It's a great question, and
Speaker 1: I think to your latter point, Katie, I think you're
Speaker 1: getting it something that we that people have to be
Speaker 1: very careful on, because what you're kind of leading to
Speaker 1: say is, well, look what the markets are telling us, okay,
Speaker 1: And you have to remember markets do not instruct you,
Speaker 1: They serve you, okay, As Buffett says, So to use
Speaker 1: that example, anybody it looked late last year, they say, well,
Speaker 1: what's the market telling us? And the answer was, what
Speaker 1: was a bear market? You idiot? Right, That's what the
Speaker 1: markets we're going to tell you in the end. But
Speaker 1: nobody knew that at the time. And so how we
Speaker 1: look at this when it comes to what the Federal
Speaker 1: Reserve is attempting to do, they are going to attempt
Speaker 1: to try to raise rates in a way to get
Speaker 1: real real rates on the short end of the curve
Speaker 1: to zero. Now, where are they gonna have to do that?
Speaker 1: I mean north of four, probably five? Because the question
Speaker 1: is is how is aggregate demand going to react to that,
Speaker 1: which so far aggregate demand has not done what you'd
Speaker 1: have thought, um, you know, compared to most rate rises.
Speaker 1: I think that has to do with the consumer and
Speaker 1: the household and that kind of stuff. But I just
Speaker 1: pointed out, because what if this is terribly sticky and
Speaker 1: what if it continues to flow through wages? So the
Speaker 1: best wages in America year over year last you know,
Speaker 1: looking twelve months back, was the lowest income cortile okay,
Speaker 1: Which means if blue collar America or the lower end
Speaker 1: part of America's winning, who the loser is in fed
Speaker 1: rate increases our asset owners a k a. The stock market, okay?
Speaker 1: And so that what you know in the resultan POSAR framework,
Speaker 1: good is bad? Right? We have this great economy that's
Speaker 1: bad because rates are going to glot faster. The question
Speaker 1: is bad for who, I would argue less so bad
Speaker 1: for the economy that will probably affect it at some point,
Speaker 1: it's really bad for stocks and bonds. But here's a
Speaker 1: great part. For bonds, they're less volatile than stocks, which means,
Speaker 1: as we've seen in the tenure, you can kind of
Speaker 1: suck up your bleeding uh slower over time. Stocks don't
Speaker 1: have that benefit. So cool, I mean putting that pushing
Speaker 1: up forward to what they're going to get tomorrow and
Speaker 1: sort of the data release and NFP of course, uh,
Speaker 1: the employment figures. It sounds like by that logic, I mean,
Speaker 1: if we've got a really strong number, perhaps that would
Speaker 1: be bad news for the asset owners for the equity market. Yeah,
Speaker 1: but this this equity market has been very strange. Um,
Speaker 1: we kind of think we're halfway through it. I'll get
Speaker 1: I'll give you a little uh statistic. Go look at
Speaker 1: margin den In any big bear market, margin dead always
Speaker 1: declines over I think we got the any some odd
Speaker 1: percent in this decline. So um, I look at the
Speaker 1: equity investors in the sun and negregate today. They are
Speaker 1: a group of people that say, eat, drink and be
Speaker 1: merry for tomorrow we die. If they're unwilling to give
Speaker 1: up on their bullishness and their excitement and their hope
Speaker 1: that inflation won't be a big deal for stocks, when
Speaker 1: in reality, I agree with you, m it is going
Speaker 1: to impact them. We're likely to end this decade the
Speaker 1: decade of theies like we did in the seventies. We're
Speaker 1: probably no one wants to own stocks and maybe not
Speaker 1: own bonds because of the effects of the costa capitalizing
Speaker 1: and inflation. So where are they going to invest? Well,
Speaker 1: if I'm using my nineteen seventies framework, guess what sector
Speaker 1: did better than any sector in the SMP five hundred
Speaker 1: and ended up being of the stock market by the
Speaker 1: end of the seventies. Exactly seventies. And you know what
Speaker 1: Coals talking about. Then you think energy, so and people.
Speaker 1: He's just mad at me because I did a little
Speaker 1: tim splanning. So I'm sorry, please come on. Yeah, I
Speaker 1: was gonna say that this is millennial splanning, by the way,
Speaker 1: But so the nineteen seventies, most people lost money outright,
Speaker 1: or particularly in real terms. Right. There was nominal money
Speaker 1: made in some cases, but in real terms you lost money.
Speaker 1: The only place where you made real wealth was roughly
Speaker 1: an energy Some of the real estate spots did well
Speaker 1: during that time, etcetera. Um. The primary name of the
Speaker 1: game the next decade ahead, and stocks is retaining real
Speaker 1: purchasing power. And I cannot over emphasize that because if
Speaker 1: the rest of wealthy America gets poorer in real terms
Speaker 1: and you don't, you win. That's how this game is played. Alright, Cole,
Speaker 1: we gotta leave it there. It's always great when you
Speaker 1: join us. That's Cole Smede, president and portfolio manager at
Speaker 1: Smeede Capital Management. He joins us this afternoon on the
Speaker 1: phone from Phoenix, Arizona. Check him out on Twitter at
Speaker 1: Cole Underscore Smade. That's ce L E. S m E
Speaker 1: a d. Thanks for listening to Bloomberg Busines this week.
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