1 00:00:13,840 --> 00:00:17,280 Speaker 1: Hello, and welcome to What Goes Up, a weekly markets podcast. 2 00:00:17,320 --> 00:00:19,599 Speaker 1: My name is Mike Reagan. I'm a senior editor at 3 00:00:19,600 --> 00:00:22,959 Speaker 1: Bloomberg and I'm all Donna hik Across Acid reporter with Bloomberg. 4 00:00:23,360 --> 00:00:27,200 Speaker 1: This week on the show, wello is almost ready for 5 00:00:27,320 --> 00:00:30,639 Speaker 1: its place in the history books, and for investors, it'll 6 00:00:30,680 --> 00:00:34,720 Speaker 1: be a pretty ugly chapter. Stocks, bonds, crypto, you name it. 7 00:00:34,760 --> 00:00:37,880 Speaker 1: Pretty much all investments suffered this year as the Federal 8 00:00:37,920 --> 00:00:41,600 Speaker 1: Reserve raised interest rates to quell historic inflation. So what 9 00:00:41,680 --> 00:00:44,919 Speaker 1: does having store? We'll get into it with the head 10 00:00:44,920 --> 00:00:48,200 Speaker 1: of investment strategy for the America's at a big investment firm, 11 00:00:48,280 --> 00:00:52,240 Speaker 1: who is kind enough to break out her crystal ball fore. 12 00:00:52,280 --> 00:00:55,840 Speaker 1: I hope she has a crystal balls Okay, you know 13 00:00:55,920 --> 00:00:58,280 Speaker 1: how about you, Baldonna. It's very It's that time of 14 00:00:58,360 --> 00:01:02,440 Speaker 1: year to get very reflective. Uh do your year end evaluation? 15 00:01:02,480 --> 00:01:07,520 Speaker 1: Have you yourself evaluation? Of course? I look so highly 16 00:01:07,560 --> 00:01:11,760 Speaker 1: of myself. You did, I would say if they were 17 00:01:11,920 --> 00:01:14,200 Speaker 1: to ask me for some input for that, I would 18 00:01:14,200 --> 00:01:16,760 Speaker 1: be mostly positive, but I would have to say, um 19 00:01:16,800 --> 00:01:19,679 Speaker 1: when it comes to our game show. Uh. In the 20 00:01:19,720 --> 00:01:23,800 Speaker 1: Craziest Thing segment of the podcast, the prices, precise performance 21 00:01:23,840 --> 00:01:26,240 Speaker 1: has been a little lot less. It's been a little 22 00:01:26,720 --> 00:01:29,480 Speaker 1: three or four times. I think I should go back 23 00:01:29,480 --> 00:01:31,520 Speaker 1: and keep tracking how many times I've one. I have 24 00:01:31,520 --> 00:01:33,560 Speaker 1: one more time than you have. Well, not in the 25 00:01:33,600 --> 00:01:38,280 Speaker 1: host I win every time. That's not fair. But the 26 00:01:38,280 --> 00:01:40,240 Speaker 1: good news is, I feel like it's kind of been 27 00:01:40,280 --> 00:01:42,840 Speaker 1: my fault that the the topics have been out of 28 00:01:42,840 --> 00:01:46,280 Speaker 1: your wheelhouse. So just to boost your yearine performance, I've 29 00:01:46,280 --> 00:01:49,240 Speaker 1: got one that's squarely in your wheelhouse this week, just 30 00:01:49,280 --> 00:01:52,880 Speaker 1: for you. Is it about Taylor Swift? Is that yours? Yeah? 31 00:01:56,360 --> 00:01:58,920 Speaker 1: All right, and I hear I guess has something really 32 00:01:59,000 --> 00:02:02,680 Speaker 1: great prepared for craziest things in markets, So I do 33 00:02:02,760 --> 00:02:05,400 Speaker 1: want to bring her in. It's Gargi Chadry. She's head 34 00:02:05,400 --> 00:02:08,880 Speaker 1: of Ice Shares Investment Strategy America's and I'm so happy 35 00:02:08,880 --> 00:02:11,000 Speaker 1: that she's joining us today. Thanks so much for coming 36 00:02:11,000 --> 00:02:13,440 Speaker 1: on the show. Gargi. Hi guys, it's so great to 37 00:02:13,480 --> 00:02:16,399 Speaker 1: be here. Thank you Mike and Lodanna for having me. Yeah, 38 00:02:16,440 --> 00:02:18,240 Speaker 1: thanks so much for joining us. And maybe just to 39 00:02:18,280 --> 00:02:21,239 Speaker 1: start out, you can tell us about your role at 40 00:02:21,440 --> 00:02:24,720 Speaker 1: black Rock and what it entails. Sure, of course, so 41 00:02:24,960 --> 00:02:29,240 Speaker 1: um I run a team of investment strategists. The what 42 00:02:29,360 --> 00:02:33,720 Speaker 1: that means in um plain English language is we tell 43 00:02:33,760 --> 00:02:36,320 Speaker 1: our clients who invest with a share as E t 44 00:02:36,520 --> 00:02:38,960 Speaker 1: F S how to think about the market. So, you know, 45 00:02:38,960 --> 00:02:41,560 Speaker 1: obviously you guys were talking about what a historic here 46 00:02:41,680 --> 00:02:43,840 Speaker 1: this has been, but what does that mean? Where does 47 00:02:43,880 --> 00:02:47,639 Speaker 1: that create opportunities? And what is the macro environment telling us? 48 00:02:48,200 --> 00:02:52,200 Speaker 1: You know, taking everything the data, the policy, the geopolitics 49 00:02:52,400 --> 00:02:57,400 Speaker 1: and turning that into investable themes with shas ETF. So 50 00:02:57,440 --> 00:02:59,880 Speaker 1: that's what my team and I do. And then also 51 00:03:00,040 --> 00:03:02,240 Speaker 1: we try to get a sense of how people are 52 00:03:02,280 --> 00:03:04,520 Speaker 1: position what are the flows telling us, Is there an 53 00:03:04,560 --> 00:03:06,720 Speaker 1: area of the market that flows should have gone to 54 00:03:06,880 --> 00:03:10,680 Speaker 1: and didn't. So a lot of macro research, implementation ideas 55 00:03:11,080 --> 00:03:14,440 Speaker 1: and research. Yeah, yeah, Gargy, We very much look forward 56 00:03:14,440 --> 00:03:17,640 Speaker 1: to getting your outlook for three. But even in the 57 00:03:17,720 --> 00:03:20,680 Speaker 1: more near term point, we have a big week ahead 58 00:03:20,720 --> 00:03:25,400 Speaker 1: of US next week Federal Reserve meeting, uh CPI data. 59 00:03:25,680 --> 00:03:28,280 Speaker 1: You know, I think everyone is sort of has their 60 00:03:28,280 --> 00:03:32,320 Speaker 1: fingers crossed under the assumption that the Federal downshift its 61 00:03:32,400 --> 00:03:35,480 Speaker 1: rate hikes to fifty basis points. What are you expecting 62 00:03:35,480 --> 00:03:37,880 Speaker 1: for next weekend? Is there anything you're worried about surprising 63 00:03:38,240 --> 00:03:41,880 Speaker 1: uh in either the CPI or the or the FED decision. 64 00:03:42,160 --> 00:03:45,440 Speaker 1: I love that question, thank you. So I think next 65 00:03:45,480 --> 00:03:48,520 Speaker 1: week will probably be all about inflation. I know we 66 00:03:48,600 --> 00:03:50,760 Speaker 1: wanted to be about the Fed, but I think it 67 00:03:50,800 --> 00:03:54,560 Speaker 1: will be about inflation. As of right now, the market 68 00:03:54,640 --> 00:03:59,240 Speaker 1: is expecting again one more week ish CPI print, So 69 00:03:59,400 --> 00:04:03,000 Speaker 1: think about perhaps a point three on core I think 70 00:04:03,080 --> 00:04:06,040 Speaker 1: anything that looks higher than that. So if we get 71 00:04:06,040 --> 00:04:08,840 Speaker 1: another point four or even a strong point three with 72 00:04:09,120 --> 00:04:12,920 Speaker 1: a strong core X shelter, so remember now the market 73 00:04:12,960 --> 00:04:16,760 Speaker 1: will be extremely focused on that core X shelter piece 74 00:04:16,839 --> 00:04:19,160 Speaker 1: because Chair Powell has brought that up and now we're 75 00:04:19,200 --> 00:04:22,120 Speaker 1: going to be just uniformly focused on that one line item. 76 00:04:22,279 --> 00:04:25,159 Speaker 1: And I think if we get a stronger than expected 77 00:04:25,240 --> 00:04:27,280 Speaker 1: number on that core X shelter, I think that could 78 00:04:27,360 --> 00:04:30,520 Speaker 1: negatively impact risk sentiment. So I think, uh, you know, 79 00:04:30,600 --> 00:04:33,279 Speaker 1: inflation is something that I've focused on my whole career, 80 00:04:33,320 --> 00:04:35,840 Speaker 1: so I'm kind of excited to to deep dive into 81 00:04:35,880 --> 00:04:40,400 Speaker 1: that data. And then with the Fed, I think a 82 00:04:40,440 --> 00:04:42,800 Speaker 1: fifty basis point is baked in. I think a Chair 83 00:04:42,839 --> 00:04:47,240 Speaker 1: Power told us as much at the Brookings. But more 84 00:04:47,320 --> 00:04:50,960 Speaker 1: important than that, fifty basis points is actually how they 85 00:04:51,120 --> 00:04:54,760 Speaker 1: project their SEP forecast. So what are they telling us 86 00:04:54,760 --> 00:04:57,360 Speaker 1: about the path of policy for the next two years, 87 00:04:57,520 --> 00:05:02,040 Speaker 1: How are they guiding us about inflation, So really breaking 88 00:05:02,080 --> 00:05:05,080 Speaker 1: down the SEP forecast for next day, I think that's 89 00:05:05,120 --> 00:05:09,000 Speaker 1: going to be really important. And also how Chair Powell 90 00:05:09,920 --> 00:05:13,560 Speaker 1: is perceived from a hawkish perspective. Again, remember the market 91 00:05:13,640 --> 00:05:17,320 Speaker 1: at first breathed a huge sigh of relief at least 92 00:05:17,360 --> 00:05:20,359 Speaker 1: after November thirty year that he didn't push back on 93 00:05:20,440 --> 00:05:23,839 Speaker 1: the easing of financial conditions. So is Chair Powell going 94 00:05:23,920 --> 00:05:26,480 Speaker 1: to be a little bit more hawkish this time around 95 00:05:26,480 --> 00:05:28,919 Speaker 1: at the December meeting. I don't think so, But I 96 00:05:28,920 --> 00:05:31,000 Speaker 1: think that's what the market is going to focus on. 97 00:05:31,040 --> 00:05:34,960 Speaker 1: To what extent does he talk about uh, double sided 98 00:05:35,080 --> 00:05:39,159 Speaker 1: risks versus to what extent does he talk just about 99 00:05:39,480 --> 00:05:41,159 Speaker 1: you know, more needs to be done. So that's what 100 00:05:41,240 --> 00:05:44,040 Speaker 1: I'll be looking at. And I know you have these 101 00:05:44,080 --> 00:05:46,720 Speaker 1: different themes that you laid out in your year head look, 102 00:05:46,760 --> 00:05:48,320 Speaker 1: and I want to get to those. But just while 103 00:05:48,320 --> 00:05:51,080 Speaker 1: we're talking about the FED, another thing you had said 104 00:05:51,640 --> 00:05:54,440 Speaker 1: in your outlook is that FED easing is unlikely in 105 00:05:55,320 --> 00:06:00,280 Speaker 1: because inflation will keep persistently. Yeah, yeah, that's actually really 106 00:06:00,279 --> 00:06:02,560 Speaker 1: one of the core themes as we think about the 107 00:06:02,600 --> 00:06:06,440 Speaker 1: market for the next day. This idea that we're already 108 00:06:06,560 --> 00:06:10,800 Speaker 1: pricing in some cuts for the end of three I 109 00:06:10,839 --> 00:06:13,520 Speaker 1: think is a little bit optimistic. I think the FED 110 00:06:13,600 --> 00:06:15,640 Speaker 1: has told us again and again. Now whether the market 111 00:06:15,640 --> 00:06:18,120 Speaker 1: wants to believe it or not, but the Fed has 112 00:06:18,160 --> 00:06:22,360 Speaker 1: told us again and again that they are looking to 113 00:06:22,440 --> 00:06:26,760 Speaker 1: keep rates higher for longer. That's what they want, and 114 00:06:26,880 --> 00:06:31,720 Speaker 1: our viewers at least that both core CPI and PC inflation, 115 00:06:31,800 --> 00:06:33,640 Speaker 1: which as we know the FED looks at, you know, 116 00:06:33,800 --> 00:06:37,120 Speaker 1: their preferred measure to look at PC, both of those 117 00:06:37,160 --> 00:06:40,800 Speaker 1: will stay significantly about the two percent target. And in 118 00:06:40,880 --> 00:06:43,880 Speaker 1: a world where unemployment is still, you know, at this 119 00:06:44,000 --> 00:06:46,760 Speaker 1: juncture much below four percent, it's at three point seven 120 00:06:46,760 --> 00:06:51,080 Speaker 1: percent and looking ahead probably still remains much below their 121 00:06:51,120 --> 00:06:55,159 Speaker 1: assumption of Nehru, I think it's a little too optimistic 122 00:06:55,200 --> 00:07:00,520 Speaker 1: to expect meaningful eases three. I think we get to five, 123 00:07:00,760 --> 00:07:04,560 Speaker 1: maybe five and a quarter, and then just stop. We 124 00:07:04,839 --> 00:07:09,279 Speaker 1: let the monetary policy and its lagged effects work um 125 00:07:09,400 --> 00:07:12,000 Speaker 1: and you know, the market prices that in sometimes and 126 00:07:12,040 --> 00:07:13,680 Speaker 1: then comes all the way back and then the FED 127 00:07:13,720 --> 00:07:15,920 Speaker 1: pushes back and they price that that in and then 128 00:07:15,920 --> 00:07:17,840 Speaker 1: come all the way back. So I think there's a 129 00:07:17,840 --> 00:07:20,280 Speaker 1: little bit of that tug tug of war with the 130 00:07:20,320 --> 00:07:23,320 Speaker 1: markets and the pricing of policy for the remainder of 131 00:07:23,320 --> 00:07:25,680 Speaker 1: the year. But I doubt that they are going to 132 00:07:25,760 --> 00:07:29,400 Speaker 1: cut fifty or so basis points before the you know, 133 00:07:29,520 --> 00:07:32,200 Speaker 1: maybe in four but I doubt that will happen this year. 134 00:07:32,280 --> 00:07:34,240 Speaker 1: Maybe one at the end of the year, but no 135 00:07:34,320 --> 00:07:36,920 Speaker 1: more than that. Well, it's a great point. You know, 136 00:07:36,960 --> 00:07:40,360 Speaker 1: we've all been conditioned to sort of assume that FED 137 00:07:40,400 --> 00:07:44,480 Speaker 1: policy is joined at the hip to that two inflation target. 138 00:07:44,880 --> 00:07:48,040 Speaker 1: But is there sort of you know, some space between 139 00:07:48,080 --> 00:07:51,560 Speaker 1: those now where you know, the FED may no longer 140 00:07:51,640 --> 00:07:54,320 Speaker 1: think of two as mission accomplished. You know, if they 141 00:07:54,360 --> 00:07:57,880 Speaker 1: get that PC or core pc actually below the level 142 00:07:58,120 --> 00:08:01,920 Speaker 1: of the FED funds rate, but higher than is that 143 00:08:01,960 --> 00:08:03,800 Speaker 1: sort of mission accomplished for them, do you think? So? 144 00:08:03,960 --> 00:08:06,440 Speaker 1: You know, there's this view in the markets that a 145 00:08:06,480 --> 00:08:09,240 Speaker 1: few a few of the a few people have spoken about, 146 00:08:09,280 --> 00:08:11,640 Speaker 1: and I believe I heard this um in one of 147 00:08:11,680 --> 00:08:15,080 Speaker 1: your other podcasts as well, that you know, the FED 148 00:08:15,160 --> 00:08:20,400 Speaker 1: may revise up their target to something significantly above two. 149 00:08:20,920 --> 00:08:23,600 Speaker 1: I don't think that will happen. I don't think they're 150 00:08:23,600 --> 00:08:26,200 Speaker 1: going to revise it meaningfully higher. And I think, you know, 151 00:08:26,280 --> 00:08:29,480 Speaker 1: every time the chair gets asked about their flexible average 152 00:08:29,480 --> 00:08:32,199 Speaker 1: and facion targeting their faith policy, remember how much we 153 00:08:32,280 --> 00:08:36,680 Speaker 1: obsessed about that in the pre pandemic era when inflation 154 00:08:36,720 --> 00:08:39,920 Speaker 1: was below two percent UM. So I don't think they'll 155 00:08:39,960 --> 00:08:43,520 Speaker 1: revise it how higher. However, what I think will happen 156 00:08:44,320 --> 00:08:49,680 Speaker 1: is that even before inflation gets back to below two percent, 157 00:08:50,400 --> 00:08:53,240 Speaker 1: the Fed will pause on their rate hiking path. They 158 00:08:53,280 --> 00:08:57,040 Speaker 1: will do that because they will have seen significant improvement 159 00:08:57,440 --> 00:08:59,719 Speaker 1: on the path of policy. So we you know, just 160 00:09:00,120 --> 00:09:03,040 Speaker 1: this next month's CPI print, which will come out next week, 161 00:09:03,400 --> 00:09:07,200 Speaker 1: I think we'll already see headline CPI coming down to 162 00:09:07,360 --> 00:09:10,840 Speaker 1: a seven handle, So that's significantly lower than the nine 163 00:09:10,880 --> 00:09:14,040 Speaker 1: is percent that we saw. Core inflation will probably come 164 00:09:14,080 --> 00:09:16,960 Speaker 1: down to just about six maybe, I mean, if we're lucky, 165 00:09:16,960 --> 00:09:19,480 Speaker 1: maybe a five point nine, but just about six, I think. 166 00:09:20,120 --> 00:09:23,319 Speaker 1: And then as we look towards you know, May of 167 00:09:23,520 --> 00:09:26,120 Speaker 1: next day, I think it's likely that we could see 168 00:09:26,160 --> 00:09:28,480 Speaker 1: sort of a high three, like up three point seven 169 00:09:28,559 --> 00:09:31,120 Speaker 1: or so. So it's a lot of progress from where 170 00:09:31,160 --> 00:09:34,160 Speaker 1: we come from. But it's not the two percent that 171 00:09:34,160 --> 00:09:36,600 Speaker 1: they're looking for, and I think they have to be 172 00:09:36,720 --> 00:09:40,120 Speaker 1: okay with that as long as the direction of travel 173 00:09:41,000 --> 00:09:44,080 Speaker 1: is in the right direction. So if the direction of travel, 174 00:09:44,400 --> 00:09:49,080 Speaker 1: especially on a core x of shelter, is in the 175 00:09:49,280 --> 00:09:54,040 Speaker 1: right direction, I think they will definitely be okay to pause, 176 00:09:54,440 --> 00:09:57,080 Speaker 1: but not easy. And then let's talk a little bit 177 00:09:57,080 --> 00:10:00,439 Speaker 1: more about what you're seeing. Because in your side for 178 00:10:00,559 --> 00:10:03,320 Speaker 1: next year, you say that the investing regime we have 179 00:10:03,480 --> 00:10:06,480 Speaker 1: long known has changed, and then you lay out your themes. 180 00:10:06,520 --> 00:10:09,360 Speaker 1: So maybe you can just walk us through your thinking. Sure, 181 00:10:09,520 --> 00:10:12,440 Speaker 1: thank you for bringing up the investment Investment Guide. So 182 00:10:12,480 --> 00:10:16,040 Speaker 1: we published that last week November three year. It is 183 00:10:16,160 --> 00:10:20,959 Speaker 1: our themes for twenty three and I think it's particularly exciting. Well, 184 00:10:21,000 --> 00:10:23,560 Speaker 1: I would think so because my team and I, you know, 185 00:10:23,679 --> 00:10:25,880 Speaker 1: spend a lot of time and effort on this. But 186 00:10:25,960 --> 00:10:30,240 Speaker 1: I think it's particularly exciting thinking about twenty three now 187 00:10:30,480 --> 00:10:34,920 Speaker 1: because of the rough year two was like no doubt 188 00:10:35,000 --> 00:10:37,040 Speaker 1: unless you were in cash, and if you were privileged 189 00:10:37,120 --> 00:10:39,600 Speaker 1: enough to be in cash, um, if you were in 190 00:10:39,640 --> 00:10:42,400 Speaker 1: any other part of the market. I guess outside of energy, 191 00:10:42,960 --> 00:10:46,120 Speaker 1: you've had a really tough go at it and I 192 00:10:46,160 --> 00:10:50,120 Speaker 1: think while we sort of swallow that, it has also 193 00:10:50,280 --> 00:10:54,080 Speaker 1: created this incredible opportunity for the year ahead. And and 194 00:10:54,120 --> 00:10:57,400 Speaker 1: nowhere is that more prevalent than in the fixed income markets. 195 00:10:57,559 --> 00:11:00,000 Speaker 1: And we spend a lot of the report actually talking 196 00:11:00,040 --> 00:11:03,280 Speaker 1: about that, but broadly, you know, as you lay Abradana, 197 00:11:03,480 --> 00:11:06,800 Speaker 1: one of the things that we we start off talking 198 00:11:06,800 --> 00:11:10,840 Speaker 1: about is how this next six to twelve months and 199 00:11:10,880 --> 00:11:13,000 Speaker 1: you know, we're not looking past that, but at least 200 00:11:13,000 --> 00:11:15,120 Speaker 1: the next one six to twelve months is going to 201 00:11:15,200 --> 00:11:20,200 Speaker 1: be very different than the previous regime of a very 202 00:11:20,240 --> 00:11:25,160 Speaker 1: accommodative central bank that is poised to cut rates at 203 00:11:25,200 --> 00:11:28,800 Speaker 1: any hint of an economic slowdown. And I think we 204 00:11:28,880 --> 00:11:32,760 Speaker 1: are now grappling with a central bank, or for that matter, 205 00:11:32,840 --> 00:11:37,600 Speaker 1: we're grappling with a capital market where interest rates are 206 00:11:37,800 --> 00:11:40,560 Speaker 1: higher for longer, and that is the new normal. It 207 00:11:40,679 --> 00:11:43,560 Speaker 1: is not the lower for normal, lower for longer that 208 00:11:43,679 --> 00:11:46,360 Speaker 1: we have gotten used to, which of course, you know, 209 00:11:46,520 --> 00:11:49,720 Speaker 1: had its own ramifications on where in the equity market 210 00:11:49,760 --> 00:11:52,240 Speaker 1: you want to invest or what that means for returns 211 00:11:52,240 --> 00:11:57,080 Speaker 1: and fixed income. I think understanding that for the near term, 212 00:11:57,200 --> 00:12:01,160 Speaker 1: with inflation remaining above the FED style, get that rates 213 00:12:01,160 --> 00:12:04,520 Speaker 1: are going to stay high and where you should allegate 214 00:12:04,640 --> 00:12:08,040 Speaker 1: too is really profound, and that's what we're focused on 215 00:12:08,040 --> 00:12:17,400 Speaker 1: on the investor guy. So how do are we thinking 216 00:12:17,400 --> 00:12:22,079 Speaker 1: about sort of the growth versus value trade in that scenario? Um? 217 00:12:22,120 --> 00:12:24,320 Speaker 1: You know, is is it time to keep in that 218 00:12:24,520 --> 00:12:27,360 Speaker 1: value and and sort of everything but tecking growth basket 219 00:12:28,120 --> 00:12:32,120 Speaker 1: going in absolutely, Mike, that's actually our you know, second 220 00:12:32,200 --> 00:12:34,880 Speaker 1: theme our first team, which I'm hopeful that we'll talk 221 00:12:34,920 --> 00:12:36,839 Speaker 1: a little bit more about, is the role of bonds 222 00:12:36,840 --> 00:12:40,280 Speaker 1: in a portfolio and how it's significantly shifted UH this 223 00:12:40,360 --> 00:12:43,480 Speaker 1: year and will be much more meaningful in three. But 224 00:12:44,200 --> 00:12:47,760 Speaker 1: second theme is around this idea that you know, whenever 225 00:12:47,760 --> 00:12:50,960 Speaker 1: I'm talking to clients and they're looking to hear our 226 00:12:51,080 --> 00:12:53,560 Speaker 1: views on the equity market, they always want to know 227 00:12:53,679 --> 00:12:56,320 Speaker 1: around you know, when should I get back into the 228 00:12:56,400 --> 00:13:01,480 Speaker 1: growth trade? And historically, obviously, you know, when we've gone 229 00:13:02,000 --> 00:13:05,800 Speaker 1: into slow down periods where we've either been forecasting a 230 00:13:05,880 --> 00:13:09,800 Speaker 1: recession or we've been in a recession, growth has obviously 231 00:13:09,880 --> 00:13:13,240 Speaker 1: led the way. But that's been because that's always the 232 00:13:13,320 --> 00:13:17,439 Speaker 1: time when the FED steps in and cuts rates meaningfully, 233 00:13:18,000 --> 00:13:22,360 Speaker 1: sometimes even bringing real rates to negative territory. And that 234 00:13:22,400 --> 00:13:26,960 Speaker 1: has been very very beneficial for the growth part of 235 00:13:26,960 --> 00:13:30,240 Speaker 1: the equity market. But this time it's a new regime 236 00:13:30,400 --> 00:13:32,800 Speaker 1: where at least again for the next six to twelve months, 237 00:13:32,800 --> 00:13:35,040 Speaker 1: the FED has told us over and over again that 238 00:13:35,080 --> 00:13:40,040 Speaker 1: they are keeping rates at a higher level for longer, 239 00:13:40,520 --> 00:13:44,280 Speaker 1: and that's actually better, we think for the value segments 240 00:13:44,360 --> 00:13:47,280 Speaker 1: of the market, so um at least for the near term, 241 00:13:47,360 --> 00:13:51,319 Speaker 1: until we expect the FED to start to cut rates, 242 00:13:51,360 --> 00:13:53,920 Speaker 1: to begin on their cutting cycle, which we do not 243 00:13:54,080 --> 00:13:56,400 Speaker 1: think is going to be the case this year. We 244 00:13:56,480 --> 00:13:59,880 Speaker 1: think that value, much like this year, will outperform in 245 00:14:00,000 --> 00:14:02,959 Speaker 1: a higher rate regene. Now we can certainly and if 246 00:14:03,000 --> 00:14:05,199 Speaker 1: this does happen, if we feel like the economy is 247 00:14:05,240 --> 00:14:08,600 Speaker 1: slowing down much more meaningfully or inflation has come back 248 00:14:08,679 --> 00:14:11,559 Speaker 1: down much more meaningfully than is our base case or 249 00:14:11,600 --> 00:14:13,920 Speaker 1: our forecast right now. Of course, that could shift if 250 00:14:13,960 --> 00:14:16,160 Speaker 1: the FED were to begin to cut rates back down 251 00:14:16,559 --> 00:14:18,680 Speaker 1: um to zero or even just back down to two 252 00:14:18,679 --> 00:14:20,440 Speaker 1: percent or something like that, But that is not the 253 00:14:20,480 --> 00:14:22,760 Speaker 1: card right now. I think we are going to at 254 00:14:22,840 --> 00:14:25,880 Speaker 1: least for the next few months, actually see higher interest 255 00:14:25,960 --> 00:14:29,160 Speaker 1: rates from the BED, perhaps at the end of first quarter, 256 00:14:29,720 --> 00:14:33,239 Speaker 1: and again in that period. You want to be allocated 257 00:14:33,280 --> 00:14:36,960 Speaker 1: to the value part of the equity market with tickers 258 00:14:36,960 --> 00:14:38,680 Speaker 1: such as sort of you know I W D or 259 00:14:38,720 --> 00:14:43,200 Speaker 1: I V which give you that allocation to broader value 260 00:14:43,200 --> 00:14:45,400 Speaker 1: segments of the market, or something like a V l 261 00:14:45,440 --> 00:14:48,520 Speaker 1: U E, which again is a value factor that gives 262 00:14:48,520 --> 00:14:51,600 Speaker 1: you exposure to those deep value names. And we saw 263 00:14:51,640 --> 00:14:54,240 Speaker 1: that this year. We saw sort of that outperformance of 264 00:14:54,240 --> 00:14:58,600 Speaker 1: minimum volatility and value and to a certain extent, at 265 00:14:58,640 --> 00:15:00,920 Speaker 1: least in the beginning of next day, I think that 266 00:15:01,080 --> 00:15:05,800 Speaker 1: minimum volatility and value can outperform. And then by the 267 00:15:05,960 --> 00:15:08,040 Speaker 1: end of next day, and you know, hopefully we can 268 00:15:08,080 --> 00:15:11,040 Speaker 1: have another conversation then. But by the end of next day, 269 00:15:11,040 --> 00:15:13,280 Speaker 1: if we do see that the FED is stepping in 270 00:15:13,840 --> 00:15:16,480 Speaker 1: and getting ready to ease rates, we can talk about 271 00:15:16,560 --> 00:15:19,200 Speaker 1: if it's time to go into growth and where and growth. 272 00:15:19,240 --> 00:15:21,520 Speaker 1: I think that will be another exciting conversation. Not all 273 00:15:21,640 --> 00:15:25,280 Speaker 1: growth will be behaved the same way. They'll certainly be 274 00:15:25,360 --> 00:15:29,280 Speaker 1: pockets of high quality tech such as semiconductors, such as 275 00:15:29,360 --> 00:15:31,680 Speaker 1: robotics that will do really well, and there will be 276 00:15:31,760 --> 00:15:35,880 Speaker 1: other pockets that will not. So can I ask you 277 00:15:36,160 --> 00:15:39,480 Speaker 1: follow up on this which is so earlier this year 278 00:15:39,520 --> 00:15:42,920 Speaker 1: we obviously had a couple of different rallies in the 279 00:15:42,960 --> 00:15:46,440 Speaker 1: stock market that then sort of petered out, they didn't 280 00:15:46,520 --> 00:15:49,720 Speaker 1: end up holding. And I think during one of the 281 00:15:49,720 --> 00:15:53,480 Speaker 1: earlier ones, maybe sometime over the summer, we actually saw 282 00:15:54,080 --> 00:15:55,880 Speaker 1: when we saw the rally happening, we saw a lot 283 00:15:55,880 --> 00:16:00,000 Speaker 1: of speculative names also rallying meme stocks and tech versus 284 00:16:00,080 --> 00:16:02,640 Speaker 1: is what we're seeing now where we are actually seeing 285 00:16:02,680 --> 00:16:04,800 Speaker 1: some of those value names doing a little bit better. 286 00:16:04,920 --> 00:16:06,720 Speaker 1: I'm just wondering if you think that that's a sign 287 00:16:06,800 --> 00:16:09,840 Speaker 1: that maybe the rally is a bit stronger, more broad 288 00:16:09,880 --> 00:16:13,560 Speaker 1: based versus just seeing you know, tech coming back for 289 00:16:13,680 --> 00:16:15,760 Speaker 1: a couple of days or a couple of weeks. Yeah, 290 00:16:15,880 --> 00:16:18,400 Speaker 1: you're absolutely right. I think there have been seven periods 291 00:16:18,440 --> 00:16:21,080 Speaker 1: the sale when the market and when I say market, 292 00:16:21,120 --> 00:16:25,400 Speaker 1: I mean IVV, just the broad index SMP has rallied 293 00:16:25,440 --> 00:16:28,560 Speaker 1: over seven percent, and we actually saw that, not not 294 00:16:28,640 --> 00:16:31,400 Speaker 1: including the last couple of days, but from October twelve 295 00:16:31,520 --> 00:16:34,440 Speaker 1: to sort of the beginning of this week, Um, we 296 00:16:34,520 --> 00:16:37,240 Speaker 1: saw another massive rally in the market. And a lot 297 00:16:37,360 --> 00:16:41,920 Speaker 1: of that is actually around the pricing in of a pivot, right, 298 00:16:41,960 --> 00:16:44,680 Speaker 1: So every time that has happened, and obviously the most 299 00:16:44,720 --> 00:16:49,520 Speaker 1: recent one was because of the CPI number followed by 300 00:16:49,640 --> 00:16:52,360 Speaker 1: the last day of November when the FEDS spoke at 301 00:16:52,600 --> 00:16:55,280 Speaker 1: UM at the Brookings Institute in November thirty year. Then 302 00:16:55,280 --> 00:16:58,480 Speaker 1: again that was all pricing in a pivot of policy. 303 00:16:58,520 --> 00:17:00,640 Speaker 1: And of course if you're pricing in a pig of policy, 304 00:17:00,680 --> 00:17:04,159 Speaker 1: you do have sort of that growth led rally and 305 00:17:04,200 --> 00:17:06,520 Speaker 1: you also have the you know, what's been interesting to 306 00:17:06,560 --> 00:17:09,680 Speaker 1: me is sort of the most shorted names that rally 307 00:17:09,720 --> 00:17:13,280 Speaker 1: the most, because obviously that's where positioning is the most offsides. 308 00:17:13,680 --> 00:17:15,879 Speaker 1: We also saw this back in the sort of the 309 00:17:15,960 --> 00:17:19,400 Speaker 1: July two or June two August rally, right, and that 310 00:17:19,400 --> 00:17:22,919 Speaker 1: that rally was what se which ended right before the 311 00:17:23,040 --> 00:17:26,720 Speaker 1: Jackson Hole meeting. And again we saw the same thing 312 00:17:26,800 --> 00:17:31,320 Speaker 1: where there was a pivot narrative getting priced in very prematurely. 313 00:17:31,359 --> 00:17:34,399 Speaker 1: There's no pivot in sight for now. And again you 314 00:17:34,440 --> 00:17:36,960 Speaker 1: saw that those areas of the market that we're probably 315 00:17:37,000 --> 00:17:40,119 Speaker 1: the least owned, that we're pricing in that pivot, and 316 00:17:40,240 --> 00:17:42,880 Speaker 1: for now, this is not a pivot. For now. The 317 00:17:42,920 --> 00:17:46,639 Speaker 1: best we can get early next year is perhaps a pause. 318 00:17:47,160 --> 00:17:49,720 Speaker 1: To me, a pivot means that the FED is going 319 00:17:49,760 --> 00:17:52,320 Speaker 1: to turn around and cut rates we're not expecting that, 320 00:17:52,400 --> 00:17:55,080 Speaker 1: and therefore those value names, looking at a v LUV, 321 00:17:55,280 --> 00:17:58,160 Speaker 1: looking at an IVY, looking at a nightputy really makes 322 00:17:58,200 --> 00:18:00,200 Speaker 1: a lot of sense in a portfolio. And I'll be 323 00:18:00,320 --> 00:18:04,200 Speaker 1: very honest, depending on how this data for CPI next 324 00:18:04,240 --> 00:18:07,439 Speaker 1: week comes out, if we get another point too or 325 00:18:07,480 --> 00:18:09,919 Speaker 1: even a point three, and if we get a core 326 00:18:10,520 --> 00:18:13,760 Speaker 1: UH Services ex Shelter component, which is the one that 327 00:18:13,800 --> 00:18:17,280 Speaker 1: I was talking about earlier, having another sort of weakest print. 328 00:18:17,320 --> 00:18:19,240 Speaker 1: It was a little less than point to last month, 329 00:18:19,280 --> 00:18:22,919 Speaker 1: and we have another point to and core UH Services 330 00:18:23,000 --> 00:18:26,439 Speaker 1: ex Shelter, I think that that can be a huge 331 00:18:26,560 --> 00:18:30,920 Speaker 1: catalyst going into your end. Everyone wants the Santa rally UM. 332 00:18:30,960 --> 00:18:34,119 Speaker 1: That can be a catalyst going into between now and 333 00:18:34,160 --> 00:18:36,800 Speaker 1: the end of January. We can see that, but I 334 00:18:36,880 --> 00:18:39,800 Speaker 1: don't think that's going to be a lasting rally because 335 00:18:39,840 --> 00:18:43,480 Speaker 1: I think that earnings growth will probably get revised lower 336 00:18:43,760 --> 00:18:48,000 Speaker 1: as we see many of the UM analysts starting their 337 00:18:48,000 --> 00:18:50,840 Speaker 1: revision for twenty three. We're going to see that in 338 00:18:50,880 --> 00:18:53,040 Speaker 1: the earning season. That is going to be with us 339 00:18:53,080 --> 00:18:55,560 Speaker 1: in the end of January, so we can have a 340 00:18:55,640 --> 00:18:57,760 Speaker 1: period of market rally. For sure. It can be a 341 00:18:57,800 --> 00:19:01,040 Speaker 1: relief rally, but it is not believed to be a 342 00:19:01,119 --> 00:19:04,600 Speaker 1: groat lad start of a new cycle. I think that 343 00:19:04,720 --> 00:19:07,560 Speaker 1: is still far away from us. Well, thank you for 344 00:19:07,680 --> 00:19:10,440 Speaker 1: defining pivot for us. It's funny how much debate there 345 00:19:10,560 --> 00:19:13,560 Speaker 1: is over the meaning of the word. Everybody uses it, yeah, 346 00:19:13,600 --> 00:19:16,520 Speaker 1: without defining it. I think it's the basketball players that 347 00:19:16,560 --> 00:19:19,040 Speaker 1: are messing everything up because you can pivot. You can 348 00:19:19,040 --> 00:19:23,000 Speaker 1: pivot in basketball without doing the full money. Just throw 349 00:19:23,080 --> 00:19:25,000 Speaker 1: that out there. One really interesting point you make in 350 00:19:25,040 --> 00:19:28,800 Speaker 1: this look ahead pieces bonds are back. Would have ever thought? 351 00:19:28,800 --> 00:19:31,040 Speaker 1: Who would have ever thought we'd be talking about bonds 352 00:19:31,080 --> 00:19:33,440 Speaker 1: as a and you have a you have a great 353 00:19:33,480 --> 00:19:37,160 Speaker 1: acronym for it. I think it's bar It's barbed. Yeah, 354 00:19:37,400 --> 00:19:40,240 Speaker 1: so we went from Tina to Barb. Thank you for 355 00:19:41,359 --> 00:19:46,560 Speaker 1: Bonds are back. Bonds are back, Bonds are back. Okay, yeah, 356 00:19:46,720 --> 00:19:48,639 Speaker 1: bonds are back. So we you know, lived in a 357 00:19:48,640 --> 00:19:52,040 Speaker 1: decade and a half of the of the Tina world, 358 00:19:52,040 --> 00:19:54,440 Speaker 1: which of course we know is there is no alternative, 359 00:19:55,000 --> 00:19:58,080 Speaker 1: and now we are about to embark upon actually we 360 00:19:58,160 --> 00:20:01,240 Speaker 1: have embarked upon it since I first started talking about 361 00:20:01,280 --> 00:20:03,720 Speaker 1: this barb or actually the first thing that I was 362 00:20:03,760 --> 00:20:06,080 Speaker 1: talking about a lot was um I called it the 363 00:20:06,160 --> 00:20:09,280 Speaker 1: yield of dreams. So it was our yield of dreams 364 00:20:09,320 --> 00:20:12,080 Speaker 1: that we were getting when you could earn about six 365 00:20:12,119 --> 00:20:13,960 Speaker 1: and a half percent and something like an i G 366 00:20:14,240 --> 00:20:17,560 Speaker 1: s B which gives you exposure to the one to 367 00:20:17,680 --> 00:20:21,639 Speaker 1: five year part of investment grade corporate credit, and to 368 00:20:21,800 --> 00:20:25,200 Speaker 1: earn over six percent was the stuff of dreams because remember, 369 00:20:25,320 --> 00:20:29,120 Speaker 1: not that long ago we were going out into high 370 00:20:29,200 --> 00:20:32,080 Speaker 1: yield and emerging markets to earn that. We've lived through that, 371 00:20:32,200 --> 00:20:34,679 Speaker 1: not that long ago, so we remember what it's like 372 00:20:34,840 --> 00:20:37,600 Speaker 1: to crave yield and live in a world where there 373 00:20:37,680 --> 00:20:40,480 Speaker 1: is an alternative but to go out of the risk spectrum. 374 00:20:40,560 --> 00:20:43,960 Speaker 1: And now it is so exciting, I think, to be 375 00:20:44,040 --> 00:20:48,080 Speaker 1: in a world where there are some incredible opportunities staying 376 00:20:48,200 --> 00:20:53,080 Speaker 1: very high in quality, short in duration in the fixed 377 00:20:53,080 --> 00:20:56,840 Speaker 1: income markets and on yields that we could have only 378 00:20:56,920 --> 00:21:00,119 Speaker 1: dreamed about. Because bonds are back, because it's barbed, and 379 00:21:00,160 --> 00:21:03,000 Speaker 1: I'm talking to your treasuries here, I'm talking one to 380 00:21:03,080 --> 00:21:05,159 Speaker 1: five year i G credit, something like an i G 381 00:21:05,400 --> 00:21:08,920 Speaker 1: s V or something like an sage why or even 382 00:21:08,920 --> 00:21:11,679 Speaker 1: mortgages something like an MBB which you can earn you 383 00:21:11,680 --> 00:21:14,840 Speaker 1: about four point six percent yield without taking again too 384 00:21:14,920 --> 00:21:19,320 Speaker 1: much credit risks, staying very up in quality and earning 385 00:21:19,640 --> 00:21:24,199 Speaker 1: significant yield in your portfolio, and especially having that in 386 00:21:24,240 --> 00:21:28,280 Speaker 1: a world where, um, you know, growth is going to 387 00:21:28,280 --> 00:21:31,040 Speaker 1: slow down. Now, whether we're immediately going to fall into 388 00:21:31,040 --> 00:21:33,280 Speaker 1: a recession or not, you know, we don't know. I 389 00:21:33,320 --> 00:21:38,399 Speaker 1: think the signs are showing a recession. But even without 390 00:21:38,440 --> 00:21:41,639 Speaker 1: all of that, I think owning bonds in your portfolio 391 00:21:41,720 --> 00:21:44,560 Speaker 1: where you have historically been sixty forty two equities, I 392 00:21:44,600 --> 00:21:49,080 Speaker 1: wonder if you're supposed to be sixty forty two bonds right, Well, 393 00:21:49,119 --> 00:21:52,080 Speaker 1: the let's unpack a little bit. You're thinking on the 394 00:21:52,080 --> 00:21:54,879 Speaker 1: the m B B, the uh, the mbs E T 395 00:21:55,040 --> 00:22:00,159 Speaker 1: F T. I feel like when people hear mortgages, uh know, 396 00:22:00,480 --> 00:22:03,399 Speaker 1: there's there's a little bit of a yeah and a 397 00:22:03,440 --> 00:22:05,400 Speaker 1: little bit of a fear. And and then that scenario 398 00:22:05,480 --> 00:22:08,119 Speaker 1: laid out where if we do have, uh you know, 399 00:22:08,840 --> 00:22:11,040 Speaker 1: a sort of a deeper recession than people are worried about, 400 00:22:11,080 --> 00:22:14,520 Speaker 1: if we do see that uptick in unemployment and delinquencies 401 00:22:14,560 --> 00:22:18,280 Speaker 1: and defaults, how risky is our mortgages? Do you think 402 00:22:18,280 --> 00:22:21,760 Speaker 1: in that scenario? Yeah, I mean I completely hear you. 403 00:22:21,840 --> 00:22:25,680 Speaker 1: And look, it's very natural for us to always go 404 00:22:25,840 --> 00:22:28,679 Speaker 1: to It's it's a human bias, right we our brain 405 00:22:29,080 --> 00:22:32,560 Speaker 1: sort of goes to the last period that we can recall. 406 00:22:32,560 --> 00:22:37,000 Speaker 1: Whenever we hear the word housing, we think great financial crisis. 407 00:22:37,320 --> 00:22:39,400 Speaker 1: And I completely hear that, and I would say that 408 00:22:39,720 --> 00:22:44,040 Speaker 1: the dynamics off the housing market now, the dynamics of 409 00:22:44,080 --> 00:22:48,359 Speaker 1: the mortgage market now are so different from what two 410 00:22:48,400 --> 00:22:51,320 Speaker 1: thousand seven was, because two thousands seven taught us some 411 00:22:51,840 --> 00:22:57,240 Speaker 1: very good, hard earned lessons around what it means to have, um, 412 00:22:57,280 --> 00:23:01,919 Speaker 1: you know, a stronger, more regulatory in used mortgage market, 413 00:23:02,520 --> 00:23:05,960 Speaker 1: and all of that had has led us to a 414 00:23:06,119 --> 00:23:08,520 Speaker 1: world now where, of course it's much more difficult to 415 00:23:08,520 --> 00:23:12,000 Speaker 1: get mortgages. The way in which the mortgage market is 416 00:23:12,000 --> 00:23:14,479 Speaker 1: set up is a lot more different. And also just 417 00:23:14,560 --> 00:23:17,840 Speaker 1: from a structural or perspective, I think like our housing 418 00:23:17,960 --> 00:23:20,720 Speaker 1: prices going to come back come back lower from here, 419 00:23:20,800 --> 00:23:22,680 Speaker 1: for sure. I think we are going to say, see 420 00:23:22,720 --> 00:23:25,560 Speaker 1: some of that markets you point out. You know, if 421 00:23:25,640 --> 00:23:28,439 Speaker 1: unemployment rate does go up from here, let's say it 422 00:23:28,440 --> 00:23:31,000 Speaker 1: goes up another percent or so, we get up to 423 00:23:31,040 --> 00:23:35,960 Speaker 1: the mid force, which is probable over the next year. Uh, 424 00:23:36,119 --> 00:23:39,800 Speaker 1: is it possible to see further pressure on the housing market. Absolutely, 425 00:23:40,320 --> 00:23:43,639 Speaker 1: But does that mean that we're going back to the 426 00:23:43,840 --> 00:23:48,000 Speaker 1: foreclosures and exactly the same kind of outcome that we 427 00:23:48,000 --> 00:23:50,879 Speaker 1: saw in two thousand seven. The answer is no, because 428 00:23:50,880 --> 00:23:53,719 Speaker 1: it's a structurally different market. There's a lot less supply 429 00:23:53,880 --> 00:23:57,600 Speaker 1: of homes, a lot more demand. There is a lot 430 00:23:57,640 --> 00:24:01,080 Speaker 1: more people that are entering that d to thirty five 431 00:24:01,280 --> 00:24:04,600 Speaker 1: age bracket in the US that will be needing to 432 00:24:05,160 --> 00:24:08,840 Speaker 1: form households that will need to own homes. Uh. There's 433 00:24:08,960 --> 00:24:12,400 Speaker 1: also uh, you know, thinking back to two thousand seven, 434 00:24:12,440 --> 00:24:15,439 Speaker 1: I mean there was fourth selling in the mortgage space. 435 00:24:16,000 --> 00:24:18,760 Speaker 1: Right when we remember back to what was happening to 436 00:24:18,960 --> 00:24:20,920 Speaker 1: the Ginny Mays and the family maze of the world, 437 00:24:21,080 --> 00:24:23,960 Speaker 1: there was four selling of mortgages, which will not take 438 00:24:23,960 --> 00:24:28,200 Speaker 1: place this time around. These are all government sponsored entities already. Um. 439 00:24:28,320 --> 00:24:31,480 Speaker 1: And when you're sort of allocating to that space, especially 440 00:24:31,560 --> 00:24:34,400 Speaker 1: right now, when you're looking at mortgages, you know, one 441 00:24:34,440 --> 00:24:37,239 Speaker 1: of the risks, if you will, every asset class has 442 00:24:37,240 --> 00:24:39,240 Speaker 1: a risk, right, So one of the risks that you're 443 00:24:39,800 --> 00:24:43,520 Speaker 1: that that you would normally faces your pre payment risk, right, 444 00:24:43,520 --> 00:24:45,560 Speaker 1: So that is you know you've got your credit risk, 445 00:24:45,600 --> 00:24:47,719 Speaker 1: you've got your interest rate risk, and you've got your 446 00:24:47,720 --> 00:24:51,080 Speaker 1: pre payment risk and your pre payment risk. Usually in 447 00:24:51,119 --> 00:24:55,600 Speaker 1: mortgages comes about why homeowners are able to refinance and 448 00:24:55,680 --> 00:24:59,080 Speaker 1: pay down their existing mortgage, refinance into a lower rate, 449 00:24:59,240 --> 00:25:02,960 Speaker 1: and prepare them mortgage. When mortgage rates are where they are, 450 00:25:03,000 --> 00:25:06,600 Speaker 1: the number of people that can refinance is about nine 451 00:25:07,040 --> 00:25:09,919 Speaker 1: below where they work pre pandemic, so that pre payment 452 00:25:10,040 --> 00:25:13,000 Speaker 1: risk isn't really there given what mortgage rates are doing. 453 00:25:13,040 --> 00:25:15,720 Speaker 1: I don't think any of us are refinancing our home 454 00:25:15,840 --> 00:25:18,919 Speaker 1: right now. Well, going forward, you you would have to 455 00:25:18,960 --> 00:25:21,879 Speaker 1: assume that the FED does hold study and doesn't engage 456 00:25:21,880 --> 00:25:24,439 Speaker 1: in a big rate cutting campaign. I guess too, you know, 457 00:25:24,720 --> 00:25:27,560 Speaker 1: to to eliminate that risk. Yeah, and and and again 458 00:25:27,640 --> 00:25:32,200 Speaker 1: I come back to the what are my assumptions here? Uh, 459 00:25:32,240 --> 00:25:35,159 Speaker 1: And the assumptions that I build, that my team and 460 00:25:35,200 --> 00:25:39,720 Speaker 1: I build our forecast on are that number one, inflation 461 00:25:40,160 --> 00:25:43,920 Speaker 1: remains above the fed's target of two percent, in fact, 462 00:25:44,040 --> 00:25:46,920 Speaker 1: meaningfully above the fed's target of two percent on PC 463 00:25:47,760 --> 00:25:49,800 Speaker 1: for the next six six to twelve months. We think 464 00:25:49,800 --> 00:25:51,919 Speaker 1: it's going to be closer to three percent instead of 465 00:25:51,920 --> 00:25:56,040 Speaker 1: two percent by the end of Another assumption that we 466 00:25:56,160 --> 00:25:58,600 Speaker 1: build this on is and it's related to Number one 467 00:25:59,160 --> 00:26:02,280 Speaker 1: is that as a result of inflation remaining high, the 468 00:26:02,359 --> 00:26:06,240 Speaker 1: FED will not start a campaign of cutting rates aggressively 469 00:26:06,320 --> 00:26:08,680 Speaker 1: back to zero. You know, we're going to see five 470 00:26:08,760 --> 00:26:11,040 Speaker 1: five in a quarter and then a pause and just 471 00:26:11,200 --> 00:26:14,640 Speaker 1: a pause and a hold, which is actually very beneficial 472 00:26:14,680 --> 00:26:17,760 Speaker 1: for fixed income owners because you're earning your couper and 473 00:26:17,800 --> 00:26:20,840 Speaker 1: your earning that income of fixed income, which we haven't 474 00:26:20,880 --> 00:26:25,000 Speaker 1: seen in these meaningful amounts since the early nineties. So 475 00:26:25,040 --> 00:26:27,280 Speaker 1: to your point, yeah, I mean, now, if we were 476 00:26:27,359 --> 00:26:29,680 Speaker 1: to believe that the Fed is going to go back 477 00:26:29,720 --> 00:26:33,240 Speaker 1: to bringing rates down by two three basis points, which 478 00:26:33,240 --> 00:26:37,200 Speaker 1: would start that refinancing cycle, absolutely, I think that would 479 00:26:37,400 --> 00:26:40,560 Speaker 1: we would think rethink this view all together. But also 480 00:26:40,640 --> 00:26:45,800 Speaker 1: remembering that more MBB does have a interest rate sensitivity, 481 00:26:45,800 --> 00:26:48,399 Speaker 1: It does have duration if you will, of near seven years, 482 00:26:48,680 --> 00:26:52,680 Speaker 1: so you will benefit from having that interest rate duration. 483 00:26:52,800 --> 00:26:54,800 Speaker 1: But of course there's going to be that pre payment 484 00:26:55,040 --> 00:26:57,800 Speaker 1: that's going to come in as well. And one about 485 00:26:57,840 --> 00:27:00,800 Speaker 1: place is to not be in three because I know 486 00:27:00,960 --> 00:27:05,000 Speaker 1: you said recently cash had done well uh this year obviously, 487 00:27:05,320 --> 00:27:08,000 Speaker 1: but that at this point it's not exactly the best 488 00:27:08,000 --> 00:27:10,840 Speaker 1: place to be going forward, right I mean, yeah, cash 489 00:27:10,920 --> 00:27:14,040 Speaker 1: has done done well this year. I would say that 490 00:27:14,119 --> 00:27:17,600 Speaker 1: I think the time to step out of cash has come. 491 00:27:18,160 --> 00:27:21,640 Speaker 1: I think that, especially given what you're earning in the 492 00:27:21,760 --> 00:27:25,479 Speaker 1: very front end of the very high quality treasury market. 493 00:27:25,560 --> 00:27:30,800 Speaker 1: So right now, if you're in one to three year treasuries, 494 00:27:30,920 --> 00:27:33,880 Speaker 1: you're earning call it, you know, as of today four 495 00:27:33,920 --> 00:27:37,000 Speaker 1: point three um. You know, as of just a few 496 00:27:37,440 --> 00:27:40,480 Speaker 1: weeks ago, it was closer to five. I think it's 497 00:27:40,640 --> 00:27:43,359 Speaker 1: entirely possible after the FED meeting, if they push it 498 00:27:43,359 --> 00:27:45,439 Speaker 1: back on pricing just a little bit, you're going to 499 00:27:45,480 --> 00:27:50,120 Speaker 1: get some incredible opportunity to ease back into the front 500 00:27:50,200 --> 00:27:51,600 Speaker 1: end of the market with an e t f T 501 00:27:51,880 --> 00:27:54,800 Speaker 1: like s h D or s H Y and um, 502 00:27:54,960 --> 00:27:58,840 Speaker 1: you know, enjoy some of the incredible yield that you're 503 00:27:58,840 --> 00:28:02,680 Speaker 1: earning there. And I would say that, um, when we 504 00:28:03,280 --> 00:28:06,480 Speaker 1: have that yield, When we have that incredible yield in 505 00:28:06,520 --> 00:28:09,240 Speaker 1: the front end of the market, you don't really need 506 00:28:09,320 --> 00:28:12,760 Speaker 1: to sit in cash. You can be on you can 507 00:28:12,880 --> 00:28:14,760 Speaker 1: be in duration of one to three years. You're not 508 00:28:14,800 --> 00:28:17,280 Speaker 1: taking on a lot of interest rate risk, you're not 509 00:28:17,320 --> 00:28:20,160 Speaker 1: taking on any credit risk. So why be in cash 510 00:28:20,200 --> 00:28:23,080 Speaker 1: if you can earn so much more just stepping out 511 00:28:23,080 --> 00:28:26,000 Speaker 1: of cash just a little bit. So you know, cash 512 00:28:26,119 --> 00:28:29,280 Speaker 1: certainly had a role to play and probably could still 513 00:28:29,320 --> 00:28:33,160 Speaker 1: as a maybe like a mitigator to risk. But at 514 00:28:33,440 --> 00:28:36,359 Speaker 1: one year and two year treasuries yielding what they do, 515 00:28:36,760 --> 00:28:38,920 Speaker 1: I think the time to step out of cash has 516 00:28:39,120 --> 00:28:44,240 Speaker 1: has arrived. Wow, Guardi Chargery, head of Investment Strategy for 517 00:28:44,280 --> 00:28:48,440 Speaker 1: the Americas that I shares fascinating conversation. Any guests who 518 00:28:48,480 --> 00:28:50,800 Speaker 1: comes on and refuses to make a prediction, I'm going 519 00:28:50,880 --> 00:28:53,320 Speaker 1: to reference back to this episode and say you can 520 00:28:53,360 --> 00:28:55,840 Speaker 1: do it. Just have a little confidence and do it. 521 00:28:56,040 --> 00:29:13,560 Speaker 1: All right, I think it's that time, Bildonna, It's time 522 00:29:13,600 --> 00:29:18,480 Speaker 1: for you to improve your your end evaluation for me, Yes, 523 00:29:18,800 --> 00:29:21,360 Speaker 1: which which I know you care so much about. I 524 00:29:21,400 --> 00:29:24,200 Speaker 1: do care. I want, I want to win. You know, 525 00:29:24,280 --> 00:29:28,280 Speaker 1: the prices, precise competitions, obviously, all right, let's bring it on. 526 00:29:28,360 --> 00:29:30,720 Speaker 1: It's the it's the craziest thing we saw in markets 527 00:29:30,720 --> 00:29:32,840 Speaker 1: this week. Why don't you go first? So there's this 528 00:29:33,600 --> 00:29:37,120 Speaker 1: great story this week out about f t X and 529 00:29:37,160 --> 00:29:40,080 Speaker 1: Taylor Swift having been in talks for a sponsorship deal 530 00:29:40,120 --> 00:29:43,200 Speaker 1: worth more than a hundred million dollars. Oh my goodness. 531 00:29:43,600 --> 00:29:45,640 Speaker 1: And the talks fizzled out. I guess just a couple 532 00:29:45,640 --> 00:29:48,640 Speaker 1: of months before f t X collapsed there was going 533 00:29:48,680 --> 00:29:53,440 Speaker 1: to be n F t S involved somehow, like yeah, 534 00:29:53,520 --> 00:29:57,440 Speaker 1: of course, one would assume there'd be Yeah, of course. 535 00:29:57,880 --> 00:30:00,240 Speaker 1: And and Sam Bank when freed f t X, same 536 00:30:00,320 --> 00:30:03,240 Speaker 1: and countried he favored the deal because he's a fan 537 00:30:03,360 --> 00:30:10,040 Speaker 1: of quote who isn't who party? You know, we didn't 538 00:30:10,040 --> 00:30:12,640 Speaker 1: get into crypto. But I'm wondering, you know, as someone 539 00:30:12,840 --> 00:30:17,000 Speaker 1: from a E t F company, you know where your 540 00:30:17,000 --> 00:30:19,560 Speaker 1: head is at on crypto. You know, were you bullish 541 00:30:19,560 --> 00:30:23,000 Speaker 1: about the potential for some more crypto E t F s? 542 00:30:23,000 --> 00:30:25,680 Speaker 1: Where you sort of agnostic? And how are you thinking 543 00:30:25,680 --> 00:30:29,080 Speaker 1: about it now? I think the underlying blockchain technology is 544 00:30:29,120 --> 00:30:32,320 Speaker 1: something that is going to be with us. I'm gonna 545 00:30:32,400 --> 00:30:35,160 Speaker 1: sound like a very old person when I say this, 546 00:30:35,240 --> 00:30:38,360 Speaker 1: but I personally don't own any crypto and I've been 547 00:30:38,400 --> 00:30:40,960 Speaker 1: happy to see that. But I'll also say, what I 548 00:30:41,120 --> 00:30:46,000 Speaker 1: notice is how many clients asked me about crypto, And honestly, 549 00:30:47,360 --> 00:30:51,200 Speaker 1: the number is zero. If there's so much happening in 550 00:30:51,240 --> 00:30:54,360 Speaker 1: the markets with bonds and inflation and geopolitical risk in 551 00:30:54,400 --> 00:30:58,200 Speaker 1: the war and front end bonds only you five percent. 552 00:30:58,560 --> 00:31:02,640 Speaker 1: I don't think anyone is really too concerned about crypto 553 00:31:02,800 --> 00:31:05,760 Speaker 1: right now. I think that was very different in one 554 00:31:05,840 --> 00:31:09,560 Speaker 1: got a few questions that year, for sure, Yeah, right right, 555 00:31:09,720 --> 00:31:12,560 Speaker 1: that's true. That talk about you know, they were the 556 00:31:12,600 --> 00:31:15,800 Speaker 1: answer to there is no alternative. Well maybe there's this, 557 00:31:16,000 --> 00:31:18,840 Speaker 1: but uh, you know it's your point of treasuries at 558 00:31:18,840 --> 00:31:22,160 Speaker 1: the front end are paying for I don't know, even 559 00:31:22,200 --> 00:31:25,120 Speaker 1: the yield schemes and the yield farming schemes are now 560 00:31:25,640 --> 00:31:28,800 Speaker 1: many of them lower than the yields on treasuries and more, 561 00:31:28,800 --> 00:31:31,960 Speaker 1: many more people are much more scared of than that. Yeah, absolutely, yeah, 562 00:31:32,000 --> 00:31:36,200 Speaker 1: absolutely for good reason. All right, uh, gargy, how about you. 563 00:31:36,280 --> 00:31:38,680 Speaker 1: What's the craziest thing you've seen recently? So there's so many. 564 00:31:39,040 --> 00:31:41,880 Speaker 1: The first one that I've been absolutely obsessed with all 565 00:31:41,920 --> 00:31:46,680 Speaker 1: of two is supply chains and just the clogging of 566 00:31:46,720 --> 00:31:49,800 Speaker 1: supply chains that happened. And you know, we all were 567 00:31:49,920 --> 00:31:53,080 Speaker 1: very familiar with how much it costs to ship a 568 00:31:53,120 --> 00:31:56,320 Speaker 1: container for the cubic foot contain now from Shanghai to 569 00:31:56,440 --> 00:31:59,000 Speaker 1: l A. So it's been really just over the last 570 00:31:59,040 --> 00:32:01,239 Speaker 1: two months, it's been incredible to see that there are 571 00:32:01,240 --> 00:32:03,360 Speaker 1: no ships stuck outside the port of l A that's 572 00:32:03,400 --> 00:32:06,040 Speaker 1: gone from hundred and seven to zero. So just seeing 573 00:32:06,080 --> 00:32:09,760 Speaker 1: the unclogging off supply chains and what that might mean 574 00:32:09,840 --> 00:32:14,120 Speaker 1: for goods inflation, especially when this was such a big 575 00:32:14,120 --> 00:32:17,400 Speaker 1: concern for for the last twelve months before that. I 576 00:32:17,400 --> 00:32:21,640 Speaker 1: think that has been incredible, just understanding the truck driver 577 00:32:21,760 --> 00:32:25,160 Speaker 1: shortage in this country and the huge impact that that 578 00:32:25,280 --> 00:32:29,720 Speaker 1: has on our day to day and thankfully that's especially 579 00:32:29,720 --> 00:32:31,640 Speaker 1: as we go into the holidays. I think that's been 580 00:32:31,680 --> 00:32:34,960 Speaker 1: incredible to have that sorted out and avoiding some of 581 00:32:35,000 --> 00:32:38,200 Speaker 1: the strikes, etcetera. So that's something that people don't think 582 00:32:38,240 --> 00:32:41,280 Speaker 1: about impacting markets, but I think it has a profound 583 00:32:41,320 --> 00:32:44,800 Speaker 1: implication on markets. So that's one crazy thing that happened 584 00:32:44,800 --> 00:32:48,440 Speaker 1: and thankfully got resolved. And then the other one, UM 585 00:32:48,880 --> 00:32:51,160 Speaker 1: is something that I was looking at recently, but just 586 00:32:51,280 --> 00:32:55,480 Speaker 1: the amount of UM options that are trading in the 587 00:32:55,560 --> 00:32:59,680 Speaker 1: market that are within a twenty four hour expery, so 588 00:32:59,720 --> 00:33:03,880 Speaker 1: pe all buying one day options is about forty of 589 00:33:03,960 --> 00:33:08,360 Speaker 1: total options traded, which is insane. That went up from 590 00:33:08,400 --> 00:33:11,640 Speaker 1: I think the number was somewhere around you know, call 591 00:33:11,720 --> 00:33:15,520 Speaker 1: it fifteen percent or so in the pre pandemic regime 592 00:33:15,560 --> 00:33:19,080 Speaker 1: to about forty three percent now, and that's why you 593 00:33:19,120 --> 00:33:21,720 Speaker 1: see such big one day moves, Like when the market 594 00:33:21,760 --> 00:33:23,800 Speaker 1: moves one percent, you're pretty sure it's going to move 595 00:33:23,880 --> 00:33:27,719 Speaker 1: two or three because of this dynamics. That's another crazy 596 00:33:27,760 --> 00:33:30,360 Speaker 1: thing that I've been noticing that has been going on 597 00:33:30,360 --> 00:33:33,520 Speaker 1: in the markets is that the you know, the Yolo 598 00:33:33,760 --> 00:33:36,960 Speaker 1: retail reddit crowd. Do you think to driving that? I 599 00:33:36,960 --> 00:33:41,920 Speaker 1: think it's just this understanding of or it's a manifestation 600 00:33:42,520 --> 00:33:45,760 Speaker 1: of a higher volatility regime that we've entered into. If 601 00:33:45,800 --> 00:33:48,080 Speaker 1: we look at where the VIX has been trading, or 602 00:33:48,120 --> 00:33:50,920 Speaker 1: even the move Index for that matter, people trying to 603 00:33:51,040 --> 00:33:54,280 Speaker 1: capitalize on that. So I don't want to attribute this 604 00:33:54,400 --> 00:33:57,520 Speaker 1: to any one type of investor. I want to attribute 605 00:33:57,560 --> 00:34:01,120 Speaker 1: it to what's happening in the markets. With respect volatility 606 00:34:01,200 --> 00:34:03,800 Speaker 1: being so high and obvious. I hope that we will 607 00:34:03,840 --> 00:34:06,600 Speaker 1: see a decline of that and maybe some of this 608 00:34:06,680 --> 00:34:09,480 Speaker 1: behavior will go away. But I think for all investors, 609 00:34:10,080 --> 00:34:13,759 Speaker 1: um investors that are trading for themselves or institutional investors, 610 00:34:13,800 --> 00:34:16,120 Speaker 1: I think it's important to know that this is a 611 00:34:16,120 --> 00:34:19,560 Speaker 1: phenomenon in the market, and when you're seeing price action 612 00:34:19,640 --> 00:34:23,240 Speaker 1: that you can attribute some of that to what's happening 613 00:34:23,239 --> 00:34:27,560 Speaker 1: in the options market as well. Um, I cannot imagine 614 00:34:27,560 --> 00:34:31,000 Speaker 1: that this stat is going to remain in alle I 615 00:34:31,040 --> 00:34:33,000 Speaker 1: would expect it to come down, but I don't think 616 00:34:33,000 --> 00:34:35,080 Speaker 1: it will go back down to the pre pandemic levels 617 00:34:35,160 --> 00:34:40,120 Speaker 1: of I think Argue wins because she brought few things, 618 00:34:40,600 --> 00:34:43,200 Speaker 1: two things. She doubled up, doubled it. All right, you're 619 00:34:43,200 --> 00:34:46,080 Speaker 1: a lot of double dip though. There are both good ones, 620 00:34:46,440 --> 00:34:49,759 Speaker 1: both good ones the options that is mind blind. All right, 621 00:34:49,800 --> 00:34:52,279 Speaker 1: Well it's your turn to win now, Bildada. I've got 622 00:34:52,360 --> 00:34:56,560 Speaker 1: faith in you on this one. Uh as as you know, gargy. 623 00:34:56,640 --> 00:34:58,960 Speaker 1: Maybe you don't know, but my favorite asset class is 624 00:34:59,080 --> 00:35:03,480 Speaker 1: redictable ridiculous collectible items. I don't know how you allocate 625 00:35:03,520 --> 00:35:07,640 Speaker 1: to that. I'm like some people do sixty forty bonds, 626 00:35:07,719 --> 00:35:16,359 Speaker 1: I do like ridiculous collectible. What I think that comes 627 00:35:16,400 --> 00:35:18,560 Speaker 1: in the first bucket? Yeah, that's that's a collectible. At 628 00:35:18,560 --> 00:35:22,400 Speaker 1: this point, a Harry Potter fan who received an exclusive 629 00:35:22,520 --> 00:35:26,280 Speaker 1: addition of the first J. K. Rowling book after entering 630 00:35:26,320 --> 00:35:29,800 Speaker 1: a published company competition is putting it up for auction. 631 00:35:32,200 --> 00:35:34,200 Speaker 1: I think you're actually gonna bid on this. This is 632 00:35:34,640 --> 00:35:40,080 Speaker 1: if this is Vldona's Wheelhouse. Gargis is Harry Potter Books anyway. 633 00:35:40,120 --> 00:35:43,440 Speaker 1: This is courtesy of the Press Association in Great Britain, 634 00:35:43,800 --> 00:35:47,840 Speaker 1: childcare practitioner. I don't know what a childcare practitioner is, 635 00:35:47,840 --> 00:35:50,840 Speaker 1: A babysitter, I guess or in any Chloe Esselmont was 636 00:35:50,920 --> 00:35:53,440 Speaker 1: sixteen when she entered the competition, having to write a 637 00:35:53,520 --> 00:35:56,160 Speaker 1: letter explaining in no more than fifty words why she 638 00:35:56,239 --> 00:35:58,640 Speaker 1: loved Harry Potter. So I feel like you could have 639 00:35:58,760 --> 00:36:02,359 Speaker 1: entered that competition, um anyway, and she won. She won 640 00:36:02,400 --> 00:36:06,720 Speaker 1: a leather bound special fifteenth Anniversary edition of Harry Potter 641 00:36:06,840 --> 00:36:10,360 Speaker 1: and the Philosopher's Stone, which is published exclusively for the 642 00:36:10,360 --> 00:36:15,280 Speaker 1: competition and signed by none other than author J. K. Rowling. 643 00:36:15,920 --> 00:36:19,160 Speaker 1: So the question is, UH, when this goes up for 644 00:36:19,239 --> 00:36:24,480 Speaker 1: auction at Hanson's Library Auction in Staffordshire on December six, 645 00:36:24,960 --> 00:36:28,000 Speaker 1: what do you suppose the auction house expects the winning 646 00:36:28,000 --> 00:36:30,800 Speaker 1: bid to be You forgot to say, we're playing the 647 00:36:30,840 --> 00:36:34,600 Speaker 1: prices and I regret to form you, Gargy. I'm gonna 648 00:36:34,600 --> 00:36:36,920 Speaker 1: need a bid from you as well, because this is 649 00:36:36,960 --> 00:36:39,840 Speaker 1: our game show. The prices precise, Gargy, I'm gonna make 650 00:36:39,880 --> 00:36:42,160 Speaker 1: you go First, what do you think the expected winning 651 00:36:42,200 --> 00:36:47,000 Speaker 1: bid in British pounds is for a fifteenth anniversary leather 652 00:36:47,120 --> 00:36:53,080 Speaker 1: bound additioned author signed Harry Potter and the Philosopher's Stone. 653 00:36:53,520 --> 00:36:59,840 Speaker 1: And I reminder it's not always a ridiculous outrageous Okay, 654 00:37:00,040 --> 00:37:03,640 Speaker 1: but let me give you one more bit of um 655 00:37:03,719 --> 00:37:07,200 Speaker 1: of little bit of color on here. Hansen's book expert 656 00:37:07,280 --> 00:37:11,120 Speaker 1: Jim Spencer, who has one global recognition for rare Harry 657 00:37:11,160 --> 00:37:15,840 Speaker 1: Potter Finds, you know, global recognition for rare Harry Potter Finds, 658 00:37:16,080 --> 00:37:18,080 Speaker 1: said he had never seen an example of a book 659 00:37:18,120 --> 00:37:20,720 Speaker 1: like this. Technically, he said, this is the rarest Harry 660 00:37:20,719 --> 00:37:24,960 Speaker 1: Potter book I've ever handled, and I have assessed hundreds. Okay, okay, 661 00:37:25,000 --> 00:37:28,080 Speaker 1: So cash isn't as cheap as it used to be, 662 00:37:29,160 --> 00:37:32,319 Speaker 1: So I am going to say there's a little bit 663 00:37:32,320 --> 00:37:34,640 Speaker 1: of tightening of financial conditions that has happened. So my 664 00:37:34,640 --> 00:37:36,920 Speaker 1: aunswer would have been differ nastya. I'm going to say 665 00:37:37,480 --> 00:37:46,560 Speaker 1: fifteen thousand dollars way above, way way above. It pretty 666 00:37:46,640 --> 00:37:49,080 Speaker 1: much the same, pretty much the same these days. So 667 00:37:49,400 --> 00:37:52,520 Speaker 1: I'm going with two hundred and fifty thousand pounds to 668 00:37:52,719 --> 00:37:57,319 Speaker 1: have a hundred and fifty thousand British. I'm putting this bit. 669 00:37:57,440 --> 00:38:02,680 Speaker 1: You are a Harry Potter bull. Yes, forever forever. I'm sorry, 670 00:38:02,719 --> 00:38:06,040 Speaker 1: but you lose again what gargy. That was like pretty 671 00:38:06,080 --> 00:38:09,960 Speaker 1: good analysis. She took in the financial conditions and that 672 00:38:10,080 --> 00:38:15,759 Speaker 1: is what they expect ten thousand pounds. Come on, but 673 00:38:16,120 --> 00:38:18,640 Speaker 1: as usual they will get Vldona will get a call 674 00:38:18,680 --> 00:38:22,640 Speaker 1: from this auction house. I definitely in our action, Yeah, 675 00:38:22,760 --> 00:38:24,719 Speaker 1: I kind of. I would have said, on seen, I 676 00:38:24,719 --> 00:38:27,280 Speaker 1: would have gone over I think I'm not actually bidding 677 00:38:27,280 --> 00:38:29,479 Speaker 1: on this because I would overbid wit so I said 678 00:38:29,520 --> 00:38:32,640 Speaker 1: fifteen thousand US dollars and you said it's ten thousand pounds. 679 00:38:32,640 --> 00:38:38,800 Speaker 1: So I mean I was close and were so bound. 680 00:38:38,960 --> 00:38:43,280 Speaker 1: I love this. I'm jealous. I'm jealous of your ability 681 00:38:43,320 --> 00:38:46,360 Speaker 1: to to to win this. Well. She took in the 682 00:38:46,400 --> 00:38:49,680 Speaker 1: tighter financial conditions, you know, and and and Britain being 683 00:38:49,719 --> 00:38:55,120 Speaker 1: sort of drinkings coming guys. Yeah, yeah, that pound liquidity 684 00:38:55,200 --> 00:38:57,239 Speaker 1: is not what it used to be. Come on, don't 685 00:38:57,239 --> 00:38:59,200 Speaker 1: make me feel to buy some bonds. Just buy some 686 00:38:59,239 --> 00:39:05,040 Speaker 1: bonds you here's a free idea for you, just e 687 00:39:05,160 --> 00:39:07,960 Speaker 1: t F that just buys Harry Potter books. What do 688 00:39:07,960 --> 00:39:10,759 Speaker 1: you think free for free, one for you. You don't 689 00:39:10,760 --> 00:39:12,840 Speaker 1: have to credit me for it. What would be the ticker? 690 00:39:13,680 --> 00:39:21,839 Speaker 1: H JAC was going but one is good one one 691 00:39:22,040 --> 00:39:27,520 Speaker 1: is really good. Yeah. W uh, Gargy Chaudry. So great 692 00:39:27,560 --> 00:39:29,640 Speaker 1: to hear your thoughts and catch up with you. Really 693 00:39:29,680 --> 00:39:31,080 Speaker 1: enjoyed it and I hope we can get you back 694 00:39:31,120 --> 00:39:33,839 Speaker 1: again soon. I would love that. Thank you guys, Thank 695 00:39:33,880 --> 00:39:44,359 Speaker 1: you Gargy. What Goes Up. We'll be back next week 696 00:39:44,680 --> 00:39:46,200 Speaker 1: and so then you can find us on the Bloomberg 697 00:39:46,280 --> 00:39:49,680 Speaker 1: Terminal website and app or wherever you get your podcasts. 698 00:39:50,400 --> 00:39:51,960 Speaker 1: We love it if you took the time to rate 699 00:39:52,000 --> 00:39:55,040 Speaker 1: and review the show on Apple Podcasts so more listeners 700 00:39:55,040 --> 00:39:57,360 Speaker 1: can find us. And you can find us on Twitter, 701 00:39:57,760 --> 00:40:01,640 Speaker 1: follow me at pat Anonymous, Weldonna Hirich is at Bldanna 702 00:40:01,680 --> 00:40:05,759 Speaker 1: high Rich. You can also follow Bloomberg Podcasts at Podcasts. 703 00:40:06,880 --> 00:40:10,040 Speaker 1: What Goes Up is produced by Stacy Wong. Thanks for listening, 704 00:40:10,160 --> 00:40:10,879 Speaker 1: See you next time.