WEBVTT - Weary Market Eager To Look Beyond Trump Chaos: Ritholtz 0:00:00.000 --> 0:00:02.320 All right, let's bring in a very Riddles Spoomberg opinion, 0:00:02.440 --> 0:00:04.520 host of Masters in Business and of course founder of 0:00:04.600 --> 0:00:08.240 Riddle's Wealth Management. Very great to have you on the 0:00:08.280 --> 0:00:11.959 first time since we got an election results, and really 0:00:12.000 --> 0:00:14.920 the first time since that long long count, and we've 0:00:14.960 --> 0:00:18.240 seen markets churn both on that and of course fiser news. 0:00:18.239 --> 0:00:20.440 How are you supposed to read these markets? What are 0:00:20.440 --> 0:00:24.360 they pricing in? That's a really good Welcome to the 0:00:24.400 --> 0:00:26.960 Bloomer Markets Podcast. I'm All Sweeney, along with my co 0:00:27.040 --> 0:00:29.560 host of Quiz. Every business day we bring you interviews 0:00:29.600 --> 0:00:33.760 from CEOs, market rows, and Bloomberg experts, along with essential 0:00:33.840 --> 0:00:37.680 marketing news. Kind the Bloomberg Markets Podcast on Apple podcast 0:00:37.880 --> 0:00:41.160 or wherever you on the podcast and on Bloomer dot com. 0:00:41.159 --> 0:00:45.479 The Democrats ruining both well. The tradeoff is we're likely 0:00:45.560 --> 0:00:49.240 to see much more fiscal stimulus, but we're also likely 0:00:49.280 --> 0:00:52.040 to see somewhat higher taxes and and that's quite a 0:00:53.080 --> 0:00:57.760 that's quite a challenge. Um right now, the assumption seems 0:00:57.800 --> 0:00:59.680 to be that we're going to have some form of 0:00:59.720 --> 0:01:04.080 DIVI I did government and arguably that's not the worst 0:01:04.080 --> 0:01:07.880 situation under normal times for the markets. I will say 0:01:08.560 --> 0:01:11.560 in the midst of an emergency or a crisis like 0:01:11.600 --> 0:01:16.080 a pandemic. You do want to see cooperation across the all. 0:01:16.200 --> 0:01:19.480 You do want to see both parties try and working together. 0:01:20.000 --> 0:01:23.440 I have said on the show before, I am shocked 0:01:23.520 --> 0:01:25.920 that we have not gotten a follow through to the 0:01:25.959 --> 0:01:31.360 stimulus from the first quarter heading into the election, and 0:01:31.440 --> 0:01:34.840 now we've been hearing noise that the Trump administration has 0:01:34.880 --> 0:01:38.880 no interest in pursuing it between now and and the 0:01:40.040 --> 0:01:44.760 formal inauguration on January, So the economy could get a 0:01:44.760 --> 0:01:48.280 little dicey over the next two months. Right. In fact, 0:01:48.360 --> 0:01:51.160 the latest just out for Marcella Wilson saying that the 0:01:51.160 --> 0:01:54.360 Trump administration is actually stepping back, according to people familiar 0:01:54.400 --> 0:01:56.840 with the situation, and that's leaving it up to you know, 0:01:56.840 --> 0:02:00.120 Mitch McConnell and Nancy Pelosi, which really is not are 0:02:00.120 --> 0:02:03.800 you consoling at all? Nancy Pelosi wanting you know, something 0:02:03.840 --> 0:02:07.360 like two point four trillion dollars and Ms McConnell doesn't 0:02:07.360 --> 0:02:12.679 even want a trillion. Really, that's a huge, huge difference. Barry, Yes, yeah, 0:02:12.680 --> 0:02:15.760 well a trillion dollars, go figure, it's a lot of money. 0:02:15.880 --> 0:02:20.320 And so it makes those two races in Georgia really 0:02:20.360 --> 0:02:24.880 really significant. I think while everybody is looking in the 0:02:24.880 --> 0:02:28.679 wrong direction, we're all looking at this this all the 0:02:28.880 --> 0:02:33.360 silly litigation trying to fight the uh the results. I 0:02:33.400 --> 0:02:36.520 think the legal team of the Trump administration is now 0:02:37.040 --> 0:02:41.360 over twelve um or arguably one for thirteen if you 0:02:41.480 --> 0:02:44.800 count moving ten feet away to six ft away as 0:02:44.840 --> 0:02:49.239 a victory. But other than that, you know, courts don't 0:02:49.280 --> 0:02:51.840 fool around you when you're there as an officer of 0:02:51.880 --> 0:02:54.919 the court, as an attorney on either side, and there 0:02:54.960 --> 0:02:57.280 are all sorts of rules. You can't what you could 0:02:57.280 --> 0:03:00.600 get away with on Fox News, you can't get away 0:03:00.639 --> 0:03:02.800 with in front of a judge and say there was fraud, 0:03:02.919 --> 0:03:06.119 and they ask you for evidence, and if you don't 0:03:06.200 --> 0:03:09.679 have any, you're putting your license in your career at risk. 0:03:10.240 --> 0:03:16.079 And so the track record has been pretty weak for 0:03:16.080 --> 0:03:20.000 for all these broad claims of nationwide fraud. So far 0:03:20.080 --> 0:03:23.720 there's no evidence, and the companies involved, some of the 0:03:23.800 --> 0:03:27.280 law firms involved, to putting themselves at risk. Yeah, I 0:03:27.320 --> 0:03:30.040 mean I guess, um, I guess they're taking the business 0:03:30.040 --> 0:03:32.320 for now. Barry. When you talk to you know, your 0:03:32.360 --> 0:03:36.480 clients and also some of your wealthy investor friends, What 0:03:36.520 --> 0:03:38.360 are they saying to you about the situation. I presume 0:03:38.440 --> 0:03:41.720 that they're pretty happy with everything, and except obviously for 0:03:41.800 --> 0:03:44.840 the coronavirus still raging around the world. Well, those who 0:03:45.400 --> 0:03:47.760 have sort of stepped away from the markets are are 0:03:47.840 --> 0:03:50.440 not exactly happy. And we've seen a number of hedge 0:03:50.440 --> 0:03:53.640 funds and others sort of take the let's wait until 0:03:53.680 --> 0:03:57.360 the dust clears, which is turns out not to be 0:03:58.120 --> 0:04:02.360 a great decision at least this time around. Generally speaking, 0:04:02.480 --> 0:04:06.720 the expectation is that markets are going to continue doing 0:04:06.760 --> 0:04:10.520 what they're doing regardless of what happens with the election. 0:04:10.840 --> 0:04:14.560 We we've noticed this, you know, throughout history, whether it 0:04:14.640 --> 0:04:19.039 was Pearl Harbor or JFK assassination or you know, go 0:04:19.040 --> 0:04:22.760 go down the list of of earth shaking events, markets 0:04:22.760 --> 0:04:25.120 have a tendency to wobble for a little bit and 0:04:25.160 --> 0:04:27.200 then just go right back to what they were doing. 0:04:27.760 --> 0:04:33.440 So personally, I'm looking forward to the noise levels coming down. 0:04:33.600 --> 0:04:38.680 I was kind of rooting in after that election for Okay, 0:04:38.720 --> 0:04:40.719 now we're done with politics, can we get back to 0:04:40.720 --> 0:04:44.279 our normal life. The I think people are somewhat shocked 0:04:44.400 --> 0:04:49.480 that post we really never returned to normal. It it 0:04:49.480 --> 0:04:52.480 it was like a continuous campaign for twenty four years. 0:04:53.120 --> 0:04:57.640 For four years, right, I would love to just put 0:04:57.720 --> 0:05:00.120 politics on the back burner and focus a little it 0:05:00.320 --> 0:05:03.640 on other things in life. It would be nice to 0:05:03.680 --> 0:05:07.560 see my Twitter feed just sort of calm down a bit. Yeah, 0:05:07.560 --> 0:05:10.960 those notifications were very definitely, very grueling, and we won't 0:05:11.000 --> 0:05:13.440 have that from the Biden team, that's for sure. So 0:05:13.640 --> 0:05:16.160 very you know, now that the dust is settling a 0:05:16.200 --> 0:05:19.600 little bit, we still have everything else out there, right, 0:05:19.680 --> 0:05:23.919 lack of stimulus, coronavirus just going exponential in the United 0:05:23.960 --> 0:05:28.479 States and across the world, and markets still keep, you know, 0:05:29.400 --> 0:05:32.920 pumping away. I mean, what's going to burst the bubble 0:05:32.960 --> 0:05:34.760 in this market? I'm not suggesting it's it's a bubble 0:05:34.760 --> 0:05:37.159 in the traditional sense, but there's very definitely some exuberance 0:05:37.160 --> 0:05:40.200 in there, isn't there. You know, things that are unsustainable 0:05:40.200 --> 0:05:45.520 eventually run out of steam, eventually stopped running. It's arguable 0:05:45.760 --> 0:05:51.320 that this market is uh is getting tired. There. There 0:05:51.360 --> 0:05:56.160 are some signs that the stock market has been pricey, 0:05:56.400 --> 0:05:59.320 but just look around at some of the earnings that 0:05:59.600 --> 0:06:02.600 have had to come out. We we may end up 0:06:02.640 --> 0:06:07.719 being surprised by how quickly the profit side of this recovers, 0:06:07.760 --> 0:06:10.160 and to me, that's what that's what is going to 0:06:10.320 --> 0:06:13.360 drive this That there are two factors that we look at. 0:06:13.360 --> 0:06:17.200 One is multiple expansion, and that's certainly responsible for a 0:06:17.320 --> 0:06:19.760 big part of the games people wanting to pay more 0:06:19.760 --> 0:06:23.560 and more to own the same stock. But increasing profits 0:06:23.560 --> 0:06:27.240 is something we should not underestimate. And let me just 0:06:27.360 --> 0:06:31.000 remind everybody, over the course of the next year, all 0:06:31.040 --> 0:06:34.839 these companies are going to have really really easy comparables. 0:06:36.000 --> 0:06:39.800 Profits were way low and the market was looking past them. 0:06:39.839 --> 0:06:44.560 And so when we're in Q two of of or 0:06:44.640 --> 0:06:48.799 Q three, we're looking back at an environment where profits 0:06:48.839 --> 0:06:53.120 were either tiny or non existent. And so maybe that's 0:06:53.160 --> 0:06:55.479 part of what the market is looking at and seeing 0:06:55.600 --> 0:06:58.920 over the next four quarters. But comps can doors, can 0:06:58.960 --> 0:07:01.800 they barry? I mean sure, there's a baseline of economic 0:07:01.839 --> 0:07:04.760 activity that the market needs in order to be you know, 0:07:04.920 --> 0:07:09.120 happy with particular stalks. Yeah, um, no doubt about it. 0:07:09.240 --> 0:07:12.400 And the I would you know, we all tend to 0:07:12.440 --> 0:07:16.080 create these narratives after the fact. I'm wondering if some 0:07:16.200 --> 0:07:20.400 of the market enthusiasm is the thought that, hey, the 0:07:20.480 --> 0:07:23.560 new White House is gonna you know, nobody wants to 0:07:23.640 --> 0:07:27.280 do the difficult decisions up front, the painful decisions, so 0:07:27.400 --> 0:07:30.880 that you can thrive in the future. I think the 0:07:30.920 --> 0:07:33.760 Biden administration is going to do all of the difficult 0:07:34.520 --> 0:07:39.840 COVID nineteen related things, a national mask mandate, a temporary 0:07:39.920 --> 0:07:43.560 lockdown um, some form of a CARES Act, to some 0:07:43.680 --> 0:07:48.360 form of a stimulus, maybe even invoking the Defense Authorization 0:07:48.400 --> 0:07:52.040 Act to get more PPE where it has to go. 0:07:52.960 --> 0:07:56.040 And so that had we done that a year ago, 0:07:56.280 --> 0:07:58.360 the economy would be much better off. Had we done 0:07:58.360 --> 0:08:01.640 that in the beginning of we would probably not be 0:08:01.760 --> 0:08:04.280 dealing with as much of a spike as we're seeing. 0:08:04.960 --> 0:08:06.760 We're going to have to get through the next three 0:08:06.840 --> 0:08:08.960 or four months. It's not going to be easy, but 0:08:09.080 --> 0:08:11.640 the expectation is on the other side, will all be 0:08:12.640 --> 0:08:17.320 closer to getting back to normal under this administration, then 0:08:17.440 --> 0:08:19.680 the sort of lais ay fair, don't worry about the 0:08:19.720 --> 0:08:23.880 coronavirus will take care of itself. Approach of the current administration. 0:08:24.720 --> 0:08:28.320 We're waiting FED Chair J Powell, ECB President Christine Lagarde, 0:08:28.360 --> 0:08:31.640 and BOE Governor Andrew Bailey to address the CBS Annual 0:08:31.760 --> 0:08:34.480 Forum that they'll be discussing central banks in a shifting world. 0:08:34.920 --> 0:08:37.120 While we wait for the start of that, we can 0:08:37.160 --> 0:08:39.840 ask Barry Riddles about central banks in a shifting world. 0:08:40.160 --> 0:08:43.800 Barry Riddles, of course, Master's in Business podcast host, among 0:08:43.840 --> 0:08:47.440 other things. Barry, you know, the world shifted twelve years 0:08:47.440 --> 0:08:49.880 ago when we have the financial crisis and central banks 0:08:49.880 --> 0:08:52.040 got on board, and they sort of feel like they 0:08:52.040 --> 0:08:55.280 stretched that elastic band, right. Where can they go to 0:08:55.440 --> 0:08:59.199 from here? Well, I think if we learned anything from 0:08:59.240 --> 0:09:04.679 the first core or of it's it's time to pass 0:09:04.720 --> 0:09:07.520 the baton to the fiscal side of things, not the 0:09:07.559 --> 0:09:10.200 monetary side of things. When when you're at the zero 0:09:10.280 --> 0:09:15.200 bound um, what do we somewhere something like in of 0:09:15.960 --> 0:09:20.080 um of sovereign bonds are now yielding negative rates. I 0:09:20.080 --> 0:09:23.920 mean that is a quite quite a statistic, and there 0:09:23.920 --> 0:09:27.800 are all sorts of problems with negative rates or potential problems. 0:09:29.200 --> 0:09:31.840 I don't know how much more we can ask of 0:09:31.880 --> 0:09:34.800 our central banks. Um. I don't want to say they're 0:09:34.840 --> 0:09:38.680 out of AMMO, but you're at a certain point you're 0:09:38.800 --> 0:09:43.199 you're just asking. You're using the wrong tool for the job. 0:09:43.240 --> 0:09:45.720 And I think we've been asking too much of our 0:09:45.760 --> 0:09:48.400 of our central bankers around the world. Yeah, I mean 0:09:48.400 --> 0:09:51.280 I was speaking with distress to investor Whoose Richards yesterday, 0:09:51.280 --> 0:09:53.280 and you know, he talked about after month of the 0:09:53.320 --> 0:09:55.679 financial crisis and how it took a couple of years 0:09:55.720 --> 0:09:58.440 to get four trillion dollars you know, through the federals 0:09:58.440 --> 0:10:00.800 are system and into the economy. It happened in five 0:10:00.920 --> 0:10:03.920 weeks after the pandemic, after the FED went to action 0:10:04.360 --> 0:10:09.400 this time around. I mean, that's some crazy acceleration right there. Berry, Well, 0:10:09.520 --> 0:10:12.280 keep in mind, it was it was the one to 0:10:12.520 --> 0:10:17.959 punch the combination of monetary policy and a three trillion 0:10:18.000 --> 0:10:22.480 dollar fiscal stimulus. You know, what the FED does has 0:10:22.559 --> 0:10:26.880 to work its way through a series of mechanisms typically 0:10:26.920 --> 0:10:32.199 associated with credit and borrowing, and that doesn't happen instantly, 0:10:32.600 --> 0:10:36.360 especially in the midst of a pandemic. If you recall, 0:10:36.800 --> 0:10:41.880 lots and lots of small businesses and and households were 0:10:41.880 --> 0:10:45.400 complaining that in the middle of the pandemic, the credit 0:10:45.440 --> 0:10:48.160 market had tightened up so much and banks really weren't 0:10:48.240 --> 0:10:53.600 lending so so that really hamstrings the Fed's ability to 0:10:53.760 --> 0:10:58.280 affect a lot of the local economies. On the other hand, 0:10:58.800 --> 0:11:03.080 the fiscal stimulus, the direct lending to small business companies, 0:11:03.120 --> 0:11:08.600 that promised not to uh layoff staff. Um uh, that 0:11:08.600 --> 0:11:12.080 that has an immediate impact, so too, uh, it does 0:11:12.120 --> 0:11:16.800 the proposal to use federal funds to steer money to 0:11:17.000 --> 0:11:22.240 states and municipalities that, unlike the federal government, are unable 0:11:22.320 --> 0:11:26.239 to deficit spend and so were there in a genuine 0:11:26.920 --> 0:11:31.040 danger of running out of money before the year ends. 0:11:31.040 --> 0:11:33.720 And that includes things like police and fire and and 0:11:33.920 --> 0:11:37.920 ambulance and teachers and hospitals. They're in a bad way. 0:11:38.160 --> 0:11:42.400 And the hope was that the new fiscal stimulus would 0:11:42.400 --> 0:11:46.480 steer a trillion dollars or so to local states and cities. 0:11:47.320 --> 0:11:51.360 Um Uh. There was some back and forth that this 0:11:51.559 --> 0:11:56.439 was a blue state phenomena, and therefore the Trump administration 0:11:56.880 --> 0:11:59.920 was very much against it. But when you look at 0:12:00.040 --> 0:12:03.800 where the pandemic is now running amuck, it's as many 0:12:03.920 --> 0:12:08.160 red states, if not more, than blue states. And I 0:12:08.200 --> 0:12:11.439 wouldn't be surprised if as this gets worse and worse, 0:12:12.200 --> 0:12:16.680 the tone amongst whoever is running the Senate starts to 0:12:16.760 --> 0:12:20.400 soften because some of the projections are pretty horrific. Over 0:12:20.400 --> 0:12:22.840 the next three or four months, Yeah, for sure, Barry, 0:12:22.840 --> 0:12:24.199 you're about to go to the panel. But who is 0:12:24.240 --> 0:12:27.040 your guest for Master's in Business next Oh, this week 0:12:27.200 --> 0:12:30.240 Penny Pennington one of the highest ranking women in finance. 0:12:30.600 --> 0:12:33.800 She's they call it managing partner, but she's really the 0:12:33.840 --> 0:12:37.319 CEO of ed Jones. With Edward Jones, they manage one 0:12:37.320 --> 0:12:40.040 point three trillion dollars. Yes, indeed, Barry, how do you 0:12:40.040 --> 0:12:42.920 always get to my guests before I do? I'll be 0:12:42.960 --> 0:12:47.880 tuning in. Thanks for that, Barry. You at alls time 0:12:47.920 --> 0:12:50.560 to bring in Ty Lopez now executive chairman of retail 0:12:50.640 --> 0:12:57.040 e commerce Ventures and Tight deals with basically distressed retailed brands. 0:12:57.040 --> 0:12:59.600 So Ty, what what exactly do you do and and 0:12:59.640 --> 0:13:04.800 sort of how much choice do you have these days? Hey, 0:13:04.840 --> 0:13:06.920 thanks for having me on. Yeah, there's a lot of 0:13:07.000 --> 0:13:12.199 choice choices growing here. You know, we've got to interesting 0:13:12.320 --> 0:13:15.760 environment with COVID. We started buying before covid. We bought 0:13:15.880 --> 0:13:21.280 Dress Barn last year in November nineteen, so the opportunity 0:13:21.320 --> 0:13:24.920 has been there, but it's certainly there's more choice and 0:13:25.720 --> 0:13:29.040 more attractive valuations that we can purchase at. You now 0:13:29.120 --> 0:13:31.800 tell us exactly what you're buying, because so some of 0:13:31.800 --> 0:13:34.800 the brands that you bought our Dress Barn as you said, 0:13:34.880 --> 0:13:38.400 also U Pure One Models, also Linens and things. So 0:13:38.440 --> 0:13:41.160 these were bankruptcies that we sort of watched happen in 0:13:41.200 --> 0:13:43.600 front of our very eyes. Did you just buy the names, 0:13:43.640 --> 0:13:46.640 did you buy the assets, did you buy the intellectual property? 0:13:46.720 --> 0:13:51.560 And how much for? Yeah? So each deal has been different. 0:13:51.640 --> 0:13:54.440 Some of the brands were off market, like Franklin Men 0:13:54.440 --> 0:13:57.319 and Linens and things. Those weren't bankruptcies when we bought them. 0:13:57.760 --> 0:14:00.559 They have been, you know, in the past. Franklin Mint 0:14:00.679 --> 0:14:03.320 was never bankrupt, so everyone was different. Pure One we 0:14:03.400 --> 0:14:06.520 bought it an auction in July for thirty one million. 0:14:06.640 --> 0:14:10.040 We bought the I P, the intellectual property. I mean 0:14:10.080 --> 0:14:13.760 pretty much, you get the whole brand and you get 0:14:13.760 --> 0:14:17.760 the all that that includes. But we've chosen, because we're 0:14:17.760 --> 0:14:22.360 e commerce specialists, to let the stores for the most 0:14:22.360 --> 0:14:25.560 part closed. The stores are already closing. We still have 0:14:25.640 --> 0:14:29.040 the option to open back brick and mortar, but obviously 0:14:29.160 --> 0:14:31.800 we want to see how COVID shakes out before we start, 0:14:32.560 --> 0:14:35.000 you know, opening a whole bunch of stores. These stores 0:14:35.440 --> 0:14:37.880 are kind of worked out. These brands in trouble not 0:14:37.960 --> 0:14:42.200 just because of COVID, but because they signed leases assuming 0:14:42.240 --> 0:14:45.560 a certain amount of people were would visit brick and mortar, 0:14:45.800 --> 0:14:48.800 but every day Amazon and e cooms take a stronger 0:14:48.840 --> 0:14:52.840 place exactly, So what is your plan? Why even but 0:14:52.960 --> 0:14:54.960 I mean thirty one million dollars doesn't sound like a 0:14:54.960 --> 0:14:56.520 lot for pure one, let's put it that way. But 0:14:56.600 --> 0:15:00.080 why even spend that if you know the business? It 0:15:00.200 --> 0:15:05.120 just doesn't work anymore. Yeah, So it takes Pier one 0:15:05.200 --> 0:15:08.960 or dress Bar, and these brands are beloved. Um if 0:15:08.960 --> 0:15:11.560 you watch the social media, you know, and when Pierre 0:15:11.640 --> 0:15:14.320 one was going out, people were sad and people have 0:15:14.360 --> 0:15:16.880 been shopping there. It's a sixty year old brand. So 0:15:16.960 --> 0:15:20.440 we don't actually think that the brands are broken. We 0:15:20.600 --> 0:15:24.920 think that the trust uh is there as strong as 0:15:24.960 --> 0:15:27.240 ever with the brand. People have a white pier One 0:15:27.400 --> 0:15:29.280 and it's hard if you try to you know, a 0:15:29.280 --> 0:15:32.360 lot of entrepreneurs try to build businesses from scratch. I've 0:15:32.360 --> 0:15:34.800 done that before. My business partner and I have done 0:15:34.840 --> 0:15:37.200 that before. But it takes a long time to build 0:15:38.080 --> 0:15:40.720 um what we call branded awareness. So if you look 0:15:40.760 --> 0:15:45.359 at Pier one has over branded awareness out of ten Americans. 0:15:45.360 --> 0:15:48.280 If you say do you know pier One, nine say yes. 0:15:48.400 --> 0:15:51.600 And it's really hard to do that. If you start 0:15:51.600 --> 0:15:55.120 a brand from scratch, it's almost impossible. I mean Google 0:15:55.200 --> 0:15:58.120 did it obviously, But for the most part, I think 0:15:58.200 --> 0:16:02.320 that piggybacking off the trust that's already there and bringing 0:16:02.320 --> 0:16:04.600 the brands into the new e commerce world is a 0:16:04.840 --> 0:16:07.680 very viable and it's going very well with dress More 0:16:07.760 --> 0:16:10.640 and in the brands we've been doing so far. Are 0:16:10.720 --> 0:16:13.640 you trying to put everything you buy in in one 0:16:13.960 --> 0:16:17.920 retail marketplace or what will be the future for for 0:16:17.960 --> 0:16:22.840 these brands? Me my business part, we're just talking about that. Certainly, 0:16:22.880 --> 0:16:27.240 there's an option to create, you know, and you have 0:16:27.360 --> 0:16:30.360 all the brands there right now. Each brand has its 0:16:30.360 --> 0:16:34.200 own website, but we are switching more to a marketplace model, 0:16:34.440 --> 0:16:38.400 which was Amazon Jeff Bezos kind of thesis. So, for example, 0:16:38.640 --> 0:16:44.080 on Pier one, we're not only selling Pier one branded products. 0:16:44.400 --> 0:16:46.600 If you look at Wayfair, which has gone from a 0:16:46.680 --> 0:16:52.760 nine billion valuation earlier this year to they allow other people, 0:16:53.000 --> 0:16:56.880 any vendor to sell. So we're kind of hybridizing the 0:16:56.960 --> 0:17:00.680 old Pier One with the newer business model like Amazon 0:17:00.760 --> 0:17:04.879 and Wayfair. Yeah, that's fascinating. Now, will you continue to 0:17:04.920 --> 0:17:10.600 sort of buy willy nilly sort of? So you know, clothes, furniture, sports, 0:17:11.119 --> 0:17:16.199 Linen's or will you try to specialize in one area. 0:17:17.080 --> 0:17:20.480 I don't mean that, no, No, it's there's a little 0:17:20.520 --> 0:17:24.439 method to our madness. But I think we like the 0:17:24.520 --> 0:17:28.360 thought of going into different verticals, different industries. So we've 0:17:28.359 --> 0:17:31.840 done that on purpose. So for example, instead of buying 0:17:31.960 --> 0:17:35.560 five clothing brands, we'd like to buy one strong one 0:17:36.119 --> 0:17:38.640 and then buy one home goods, and then we bought 0:17:38.840 --> 0:17:42.800 models as Sportings and Franklin men Is collectibles, and so 0:17:42.840 --> 0:17:46.800 we like, we like branching out. You know, there's last 0:17:46.840 --> 0:17:51.560 I counted, there's about thirteen trilli thirteen industries that do that. 0:17:51.560 --> 0:17:54.199 I have over a trillion of revenue. We'd like to 0:17:54.240 --> 0:17:57.760 be an all thirteen of those. My kind of mentor 0:17:58.200 --> 0:18:00.560 that I've never met is Warren Buffett In. I like 0:18:00.760 --> 0:18:04.520 his approach to building a real diversified holding company. We're 0:18:04.600 --> 0:18:07.560 holding company, We're not a fund, so we actually own 0:18:07.640 --> 0:18:09.639 the majority of the assets, you know, so we like 0:18:09.720 --> 0:18:13.119 the diversity. So ty we're out of time, But what 0:18:13.119 --> 0:18:14.520 what will be next? I mean, where do you go 0:18:14.640 --> 0:18:16.919 to look for these auctions? How do they pop up 0:18:16.960 --> 0:18:20.600 for you? We're looking more at off market deals. The 0:18:20.600 --> 0:18:24.520 auction space is getting more crowded and more competitive. We 0:18:24.600 --> 0:18:28.800 have a new acquisition that I'll be able to announce 0:18:28.800 --> 0:18:33.240 in a week. So it's a bigger it's the biggest 0:18:33.280 --> 0:18:35.359 brand we've ever bought. And oh my gosh, we have 0:18:35.440 --> 0:18:37.560 to do a competition for our listeners to write in 0:18:37.680 --> 0:18:43.200 and whoever gets it right gets chanced to Alright, well 0:18:43.200 --> 0:18:44.920 it's out there now you know how to reach us. Ty, 0:18:45.040 --> 0:18:48.680 thanks for joining Ti Lopez, Executive Chairman of Retail e 0:18:48.840 --> 0:18:54.400 Commerce Venture. Is a fascinating conversation and it is time 0:18:54.440 --> 0:18:56.480 to bring in Sarah Pons, like now class a reporter 0:18:56.600 --> 0:18:59.119 here at Bloomberg. So we were looking at equities with 0:18:59.200 --> 0:19:02.080 Dave Wilson earlier, Sarah. What we didn't really talk about 0:19:02.320 --> 0:19:05.080 is the Domar Index, for example, which is been very, 0:19:05.160 --> 0:19:08.159 very volatile. We're down below again. Some of this of 0:19:08.200 --> 0:19:12.400 course on euro and Sterling, because that's they're the two 0:19:12.760 --> 0:19:15.200 biggest components for the d X Y. But what else 0:19:15.280 --> 0:19:17.440 is going on? There was some discussion that we would 0:19:17.440 --> 0:19:19.280 see the safe haven trade of the dollar return, but 0:19:19.320 --> 0:19:22.639 like you said, we have seen fluctuations lately, volatility. If 0:19:22.640 --> 0:19:24.760 I look at the Bloomberg Dollar Spot Index for example, 0:19:25.119 --> 0:19:28.800 higher on Monday, lower on Tuesday, higher yesterday, and today 0:19:29.119 --> 0:19:32.520 we are just about flat. It's really difficult to disseminate 0:19:32.600 --> 0:19:36.359 any direct trend here. It is notable, though, to point 0:19:36.400 --> 0:19:38.040 out the fact that if you zoom out and you 0:19:38.080 --> 0:19:41.240 look at a more historical perspective, we're still hovering just 0:19:41.440 --> 0:19:45.080 around this lowest level since eighteen so still dealing with 0:19:45.080 --> 0:19:49.639 a depressed dollar, not seeing too much reaction or change 0:19:49.680 --> 0:19:52.560 that would change the trend any which way. But also 0:19:52.680 --> 0:19:55.680 very notable today is just the bond market. Yes, tenure 0:19:55.720 --> 0:19:57.800 treasury yield still above ninety basis points. I look at 0:19:57.800 --> 0:20:02.040 my screen right now point three percent. However, that is 0:20:02.080 --> 0:20:05.679 down from above ninety seven basis points just yesterday and 0:20:05.760 --> 0:20:09.280 this morning as well earlier overnight. So we are seeing 0:20:09.320 --> 0:20:13.000 this change take hold, albeit a relatively small one, but 0:20:13.080 --> 0:20:15.960 still down six basis points or so on the day 0:20:15.960 --> 0:20:19.639 this after that cp I print came in lighter than expected. 0:20:19.880 --> 0:20:23.680 Some economists are now starting to wonder if it's true that, yes, 0:20:23.720 --> 0:20:26.640 we had seen inflation start to pick up after those 0:20:26.640 --> 0:20:29.439 immediate initial lockdowns. Well, are we going to get to 0:20:29.480 --> 0:20:31.800 a point now where it's going to start fading? We 0:20:31.880 --> 0:20:34.520 might see the trend even trend downwards if we start 0:20:34.560 --> 0:20:38.520 to see worries restrictions over rising COVID nineteen case take 0:20:38.560 --> 0:20:41.280 hold as well, and at that point we have restrictions 0:20:41.320 --> 0:20:43.560 coming through from governments. Being here in New York City, 0:20:43.840 --> 0:20:46.080 we know what we are about to phase starting tomorrow 0:20:46.280 --> 0:20:49.400 with relatively light restrictions, but we don't know what's going 0:20:49.440 --> 0:20:51.520 to be coming down the pipeline. At the same time, 0:20:51.760 --> 0:20:53.480 you have to wonder if people are going to self 0:20:53.520 --> 0:20:56.440 govern and self restricts, self police, get worried themselves and 0:20:56.440 --> 0:20:59.200 start pulling back on economic activity, and then the impact 0:20:59.320 --> 0:21:02.680 that has inflation and the expectations for the reflation trade 0:21:02.680 --> 0:21:04.600 going forwards. I mean, that's what the FED would say, 0:21:04.680 --> 0:21:07.919 right The FED doesn't see any inflation anywhere in the future, 0:21:08.240 --> 0:21:10.800 absolutely not. We know the FED would like to be 0:21:10.840 --> 0:21:12.520 on hold for the next couple of years. They have 0:21:12.560 --> 0:21:14.840 baked it into their forecast. They don't expect inflation to 0:21:14.840 --> 0:21:17.120 get above two percent. Even if inflation does get above 0:21:17.160 --> 0:21:19.920 two percent, we know that they have now changed their 0:21:19.960 --> 0:21:23.399 outlook their ways of governing to fate the flexible average 0:21:23.400 --> 0:21:26.879 inflation targeting methods, so they're likely not to increase interest 0:21:27.040 --> 0:21:29.640 rates even if we are just above two percent for 0:21:29.720 --> 0:21:32.560 some time now, we have not seen how this is 0:21:32.600 --> 0:21:37.280 going to work. Actually, in practice, we're not entirely sure, 0:21:37.320 --> 0:21:38.760 and we're going to have to pay attention to the 0:21:38.760 --> 0:21:42.040 Fed's words going forwards. But the feds promise and wall 0:21:42.080 --> 0:21:45.160 Streets take of the Fed's promise is that we are 0:21:45.200 --> 0:21:47.560 not going to see interest rates rise for some time. 0:21:47.680 --> 0:21:49.600 So that begs the question, even if we are seeing 0:21:49.680 --> 0:21:53.560 nominal rates rise, how high can nominal rates go if 0:21:53.600 --> 0:21:55.640 we know that the FED is not going to step 0:21:55.680 --> 0:21:59.439 off the old curve. Oil today is a big story. 0:21:59.480 --> 0:22:02.520 We're seeing the barrel of w t iBOT two dollars 0:22:02.560 --> 0:22:03.879 of borrow, which you know, in the face of it 0:22:03.880 --> 0:22:05.760 doesn't sound like much, but it's been a long time 0:22:05.760 --> 0:22:08.439 since we've seen forty two dollars plus this because OPEC 0:22:08.560 --> 0:22:11.320 is sort of trying to face reality as opposed to 0:22:11.359 --> 0:22:13.360 what it would like the world look like. Right, it's 0:22:13.359 --> 0:22:16.120 all reality, all relative when you when you talk about 0:22:16.119 --> 0:22:18.560 oil prices, we were stuck around forty dollars for so 0:22:18.600 --> 0:22:20.840 long when it comes to W t I crude oil. 0:22:20.880 --> 0:22:22.640 The fact that we are now nearing it on forty 0:22:22.680 --> 0:22:24.840 two dollars a barrel. Well, it seems like maybe you're 0:22:24.880 --> 0:22:26.320 getting a little bit of a breakout. This is the 0:22:26.359 --> 0:22:29.639 highest in September. Back then prices were forty two seventy 0:22:29.680 --> 0:22:32.399 six a barrel, So we do see prices trending higher. 0:22:32.400 --> 0:22:34.320 It does help with OPEC on the supply side of 0:22:34.359 --> 0:22:36.679 the equation. You also just have to factor in the 0:22:36.720 --> 0:22:39.320 positive news that we got from Fiser on the vaccine front. 0:22:39.520 --> 0:22:42.199 That certainly helps oil prices as well, because if you 0:22:42.200 --> 0:22:44.560 think about if we do get a vaccine sooner rather 0:22:44.600 --> 0:22:47.119 than later, what is that going to help. What is 0:22:47.119 --> 0:22:50.800 that going to inspire. Well, maybe it will reintroduce airline travel, 0:22:50.920 --> 0:22:53.640 will reintroduce cruise line travel. People maybe getting in their 0:22:53.640 --> 0:22:56.240 cars more often. Well, that means we need more gasoline, 0:22:56.240 --> 0:22:58.200 we need more oil. So therefore we could see oil 0:22:58.280 --> 0:23:00.919 prices rise off of the ack of not just supply 0:23:01.000 --> 0:23:04.880 but also the demand picture too. That also just filtering 0:23:04.880 --> 0:23:07.240