1 00:00:13,760 --> 00:00:16,840 Speaker 1: Hello, and welcome to What Goes Up, a Bloomberg Weekly 2 00:00:16,880 --> 00:00:20,360 Speaker 1: Markets podcast. I'm Sara Panzek, a reporter on the Cross 3 00:00:20,400 --> 00:00:23,079 Speaker 1: Asset team, and I'm Mike Reagan, a senior editor on 4 00:00:23,079 --> 00:00:25,840 Speaker 1: the Markets team. This week on the show, data show 5 00:00:26,079 --> 00:00:29,160 Speaker 1: that retail investors are getting in on the rally, with 6 00:00:29,240 --> 00:00:32,600 Speaker 1: new accounts surging at some popular brokerages. We talked to 7 00:00:32,640 --> 00:00:34,880 Speaker 1: the head of investment strategy at one of the leading 8 00:00:34,920 --> 00:00:37,760 Speaker 1: et F providers about how their products are being used 9 00:00:37,800 --> 00:00:40,600 Speaker 1: to play the market. Plus, there have been some major 10 00:00:40,640 --> 00:00:44,320 Speaker 1: moves in the FX markets, particularly as dollary and breaks 11 00:00:44,320 --> 00:00:47,479 Speaker 1: out of a multi year trend. And sorry, I've been 12 00:00:47,479 --> 00:00:49,280 Speaker 1: meaning to ask you, do you think we should once 13 00:00:49,280 --> 00:00:52,000 Speaker 1: again do the craziest thing I saw in markets At 14 00:00:52,000 --> 00:00:54,160 Speaker 1: the end of the show, I do think we should 15 00:00:54,160 --> 00:00:55,440 Speaker 1: do it. At the end of the show. Why why 16 00:00:55,520 --> 00:00:57,280 Speaker 1: all of a sudden change I feel good about. I 17 00:00:57,320 --> 00:00:58,680 Speaker 1: just want to make sure you're on board with it. 18 00:00:58,800 --> 00:01:02,120 Speaker 1: You know, I scared you have kind of a losing 19 00:01:02,160 --> 00:01:04,400 Speaker 1: streek going. And okay, first of all, I don't have 20 00:01:04,440 --> 00:01:07,520 Speaker 1: a losing street going. I would even say that I 21 00:01:07,600 --> 00:01:10,640 Speaker 1: came prepared. We had a couple of listeners who really 22 00:01:10,680 --> 00:01:12,920 Speaker 1: came out of the woods in this last week to 23 00:01:13,040 --> 00:01:16,160 Speaker 1: really hit on Mike. For one, we had a comment 24 00:01:16,200 --> 00:01:18,920 Speaker 1: from Corman one three four who said, like the Yankees, 25 00:01:19,240 --> 00:01:22,360 Speaker 1: I'm always rooting against Mike. So Mike, not everyone's on 26 00:01:22,400 --> 00:01:25,959 Speaker 1: your side, particularly not me and not Corman one three four, 27 00:01:26,080 --> 00:01:29,399 Speaker 1: Corman one one three four, whoever you are. I am 28 00:01:29,440 --> 00:01:31,840 Speaker 1: like the Yankees of the craziest thing. But as you know, 29 00:01:31,959 --> 00:01:34,720 Speaker 1: the crazy things in markets are one of my passions. 30 00:01:35,080 --> 00:01:38,039 Speaker 1: And as you also know, another very big interest in 31 00:01:38,120 --> 00:01:43,280 Speaker 1: mine is leveraged e t s. We've talked about this before. UM, 32 00:01:43,319 --> 00:01:46,199 Speaker 1: I'm fascinated by them. So we have a great guest 33 00:01:46,600 --> 00:01:49,240 Speaker 1: this week to discuss them with us. His name is 34 00:01:49,560 --> 00:01:54,280 Speaker 1: Simeon Hyman. He's the head of investment strategy at pro Shares. Simeon, 35 00:01:54,320 --> 00:01:57,080 Speaker 1: welcome to the show. Thanks for having me and also 36 00:01:57,160 --> 00:01:59,360 Speaker 1: joining this uh this week first time on the show 37 00:01:59,560 --> 00:02:03,560 Speaker 1: is Bloomberg's own uh Rachel Evans. She's a managing editor 38 00:02:03,960 --> 00:02:06,880 Speaker 1: covered ets for a long time now shifting focus a 39 00:02:06,880 --> 00:02:09,760 Speaker 1: little bit to bonds and FX, but still one of 40 00:02:09,880 --> 00:02:12,720 Speaker 1: our in house et F gurus who we're happy to 41 00:02:12,760 --> 00:02:14,600 Speaker 1: have on the show. Good to be here, all right, 42 00:02:15,400 --> 00:02:17,360 Speaker 1: uh Sammy, let's start with you. I do want to 43 00:02:17,400 --> 00:02:20,360 Speaker 1: get into sort of what's going on in the leveraged 44 00:02:20,680 --> 00:02:23,760 Speaker 1: et F space. But one of my favorite pro shares 45 00:02:23,800 --> 00:02:25,880 Speaker 1: E t F s has got to be Pause P 46 00:02:26,040 --> 00:02:29,000 Speaker 1: A w Z. And this is from the owner of 47 00:02:29,000 --> 00:02:31,440 Speaker 1: a Golden Doodle. You know, a neighbor of ours. Gotta 48 00:02:31,480 --> 00:02:34,359 Speaker 1: go golden doodle in my touch and New Jersey. Then 49 00:02:34,400 --> 00:02:36,360 Speaker 1: we got one and then next thing you know, they're 50 00:02:36,360 --> 00:02:39,520 Speaker 1: all over, all over with touch and fifteen years ago 51 00:02:39,639 --> 00:02:41,880 Speaker 1: he's well, he's fifteen years old. Now he's still hanging 52 00:02:41,880 --> 00:02:45,440 Speaker 1: in there. We were before you wait wait ahead of me, 53 00:02:45,480 --> 00:02:47,720 Speaker 1: of course, But Sammy, and talk to us about the 54 00:02:47,720 --> 00:02:51,160 Speaker 1: pause ETF, just the rationale behind it. I know, uh, 55 00:02:51,240 --> 00:02:55,600 Speaker 1: you know it buys pet store companies, pet medicine companies. 56 00:02:56,520 --> 00:02:59,000 Speaker 1: I'm fascinated by this ETF. Talk to us a little 57 00:02:59,000 --> 00:03:01,280 Speaker 1: bit about how it came about and sort of what 58 00:03:01,320 --> 00:03:05,519 Speaker 1: the reaction has been. Sure the tickers P A w Z. 59 00:03:05,760 --> 00:03:09,280 Speaker 1: And yes, we do pride ourselves on clever, clever tickers, 60 00:03:09,680 --> 00:03:12,320 Speaker 1: so this one counts as a clever ticker. But look, 61 00:03:12,400 --> 00:03:14,600 Speaker 1: we we look at themes all the time, and I 62 00:03:14,600 --> 00:03:17,320 Speaker 1: think the challenge when you look for themes is you 63 00:03:17,720 --> 00:03:21,040 Speaker 1: got to find where money is really being made. Um, 64 00:03:21,240 --> 00:03:24,240 Speaker 1: So here there's real money being made. And anybody who 65 00:03:24,480 --> 00:03:26,960 Speaker 1: has had to take care of their dog or even 66 00:03:27,080 --> 00:03:29,800 Speaker 1: you know, God forbid, have to actually have serious health 67 00:03:29,800 --> 00:03:32,000 Speaker 1: issues with their dogs, know how expensive it can be. 68 00:03:32,400 --> 00:03:35,880 Speaker 1: And also the trends towards premiumization and humanization. I mean, 69 00:03:35,960 --> 00:03:39,000 Speaker 1: right now, there are more households in the US with 70 00:03:39,320 --> 00:03:42,440 Speaker 1: pets than there are uh than there are children. And 71 00:03:42,760 --> 00:03:46,080 Speaker 1: the spending has been incredibly robust. And of course, as 72 00:03:46,120 --> 00:03:48,280 Speaker 1: you it wouldn't surprise you to hear that the spending 73 00:03:48,320 --> 00:03:52,000 Speaker 1: actually increased during the Great Recession. But there's also money 74 00:03:52,000 --> 00:03:55,120 Speaker 1: to be made. You know, around half the t F 75 00:03:55,240 --> 00:03:58,080 Speaker 1: is animal healthcare. And one of the ways I sort 76 00:03:58,080 --> 00:04:01,600 Speaker 1: of think about the spaces, uh, fresh off of the 77 00:04:01,600 --> 00:04:04,720 Speaker 1: the debates and all the political stuff that's going on, 78 00:04:05,360 --> 00:04:11,120 Speaker 1: I note the following there's no medicaid for dogs. You 79 00:04:11,200 --> 00:04:14,480 Speaker 1: gotta pay for that. There's some emerging insurance companies. But 80 00:04:15,160 --> 00:04:17,640 Speaker 1: it's a place where there there are margin, there's money 81 00:04:17,720 --> 00:04:21,520 Speaker 1: to be made. So, um, we thought the opportunity was there. Uh. 82 00:04:21,800 --> 00:04:24,479 Speaker 1: We think this is you know, a long term you 83 00:04:24,520 --> 00:04:27,599 Speaker 1: know opportunity. We think we did this right. In other words, 84 00:04:27,640 --> 00:04:31,279 Speaker 1: we we appropriately I found companies that were, if you will, 85 00:04:31,320 --> 00:04:34,719 Speaker 1: the pure plays, real pet care companies. You know, sometimes 86 00:04:34,800 --> 00:04:37,960 Speaker 1: you see these themes, like you know, a blockchain idea 87 00:04:38,000 --> 00:04:40,400 Speaker 1: and it ends up being a bunch of financial services company, 88 00:04:40,440 --> 00:04:42,320 Speaker 1: or like do I really get blockchain and I get 89 00:04:42,360 --> 00:04:44,719 Speaker 1: something else. We think we really did it right. We 90 00:04:44,800 --> 00:04:47,640 Speaker 1: think the the opportunities for the firms are there, the 91 00:04:47,720 --> 00:04:49,920 Speaker 1: right companies are in the e t F. And you 92 00:04:49,920 --> 00:04:53,279 Speaker 1: know what, it's conversational alpha. You know, if you're talking 93 00:04:53,279 --> 00:04:55,880 Speaker 1: if you're a financial advisor and you're talking to your clients, 94 00:04:56,240 --> 00:04:58,760 Speaker 1: it resonates because their pets are near and dear to 95 00:04:58,760 --> 00:05:00,520 Speaker 1: their heart, and they're spending so much running out of them. 96 00:05:00,520 --> 00:05:02,080 Speaker 1: Would be nice for them to make a little money. 97 00:05:02,279 --> 00:05:04,840 Speaker 1: Well for the pet care industry as well. I love 98 00:05:04,880 --> 00:05:07,080 Speaker 1: this idea of conversational alpha. This is something that the 99 00:05:07,080 --> 00:05:09,520 Speaker 1: Global X has talked about a little bit on the 100 00:05:09,520 --> 00:05:12,080 Speaker 1: Trillions podcast that that covers a t F and it's 101 00:05:12,080 --> 00:05:13,960 Speaker 1: this kind of idea that you've got something to go 102 00:05:14,040 --> 00:05:17,200 Speaker 1: to your clients and talk about. It goes beyond the returns, 103 00:05:17,480 --> 00:05:19,920 Speaker 1: so you're not just thinking about the return side of things. 104 00:05:19,920 --> 00:05:21,880 Speaker 1: You're not just thinking about the strategy, but you're able 105 00:05:21,920 --> 00:05:24,120 Speaker 1: to say, well, look, you know you own a dog, 106 00:05:24,160 --> 00:05:27,159 Speaker 1: you own a labradoodle or retrieve and it's something that 107 00:05:27,160 --> 00:05:30,080 Speaker 1: people can really identify with and they can think about 108 00:05:30,080 --> 00:05:32,320 Speaker 1: that in terms of how it might boost their portfolio. 109 00:05:32,720 --> 00:05:34,279 Speaker 1: For me, and you said, there's money to be me. 110 00:05:34,440 --> 00:05:37,799 Speaker 1: This is a long term opportunity. But if I look 111 00:05:37,839 --> 00:05:39,800 Speaker 1: at the market cap of the fund right now, it's 112 00:05:39,880 --> 00:05:43,039 Speaker 1: roughly fifty six million dollars. I mean, how do you 113 00:05:43,080 --> 00:05:46,120 Speaker 1: get over this hurdle? What is the conversation with investors 114 00:05:46,120 --> 00:05:48,520 Speaker 1: to actually get people to want to come and invest 115 00:05:48,560 --> 00:05:50,440 Speaker 1: in a product of this sort rather than just going 116 00:05:50,480 --> 00:05:53,440 Speaker 1: to a broad market fund um and have them zeroing 117 00:05:53,440 --> 00:05:56,960 Speaker 1: in on one thematics but also thematics surrounding the pet 118 00:05:56,960 --> 00:05:59,720 Speaker 1: care space. Yeah, a couple of thoughts on that. So, first, 119 00:05:59,720 --> 00:06:04,560 Speaker 1: fifty six is uh A a nice viable size for 120 00:06:04,600 --> 00:06:06,760 Speaker 1: any TF So you know, we launched this a little 121 00:06:06,800 --> 00:06:08,280 Speaker 1: bit over a year ago, so it's going in the 122 00:06:08,360 --> 00:06:12,080 Speaker 1: right direction. But absolutely these are you know that satellites 123 00:06:12,120 --> 00:06:15,760 Speaker 1: to a to a core UH to a core investment portfolio. 124 00:06:15,920 --> 00:06:18,160 Speaker 1: So you know, if one were to have an appropriately 125 00:06:18,200 --> 00:06:21,920 Speaker 1: structured long term investment portfolio. You would indeed have this 126 00:06:22,040 --> 00:06:24,839 Speaker 1: as an addition to to a core holding. So nobody 127 00:06:24,880 --> 00:06:28,039 Speaker 1: would be suggesting that you're you're the core of your 128 00:06:28,320 --> 00:06:31,400 Speaker 1: retirement from should be in a pet care ETF. But UH, 129 00:06:31,520 --> 00:06:34,840 Speaker 1: it's going to It really has the opportunity to add alpha, 130 00:06:34,920 --> 00:06:37,680 Speaker 1: to add diversification, UH and to add a little bit 131 00:06:37,680 --> 00:06:40,039 Speaker 1: of extra juice to UH to a core portfolio. And 132 00:06:40,040 --> 00:06:42,440 Speaker 1: those are the of the conversations that we're having, and 133 00:06:42,560 --> 00:06:44,920 Speaker 1: we think they're going pretty well. We're certainly looking to 134 00:06:44,960 --> 00:06:46,640 Speaker 1: grow it, but it's been moving in the right direction 135 00:06:46,680 --> 00:06:50,000 Speaker 1: since it's launched. You know, Simon Simeon as Uh Sarah 136 00:06:50,040 --> 00:06:52,120 Speaker 1: will tell you if the way I think about it, 137 00:06:52,160 --> 00:06:54,120 Speaker 1: if if I'm pulish on pets, I want to go 138 00:06:54,160 --> 00:07:00,520 Speaker 1: triple levered Paul, triple triple ever, triple levered everything. But 139 00:07:00,560 --> 00:07:02,520 Speaker 1: I do want to sort of segue into that discussion 140 00:07:02,520 --> 00:07:05,880 Speaker 1: because I know there's been UH some backlash obviously two 141 00:07:06,360 --> 00:07:10,280 Speaker 1: leveraged e t F s UH. The f sec UM 142 00:07:10,480 --> 00:07:14,040 Speaker 1: wants to sort of implement a system where brokerages have 143 00:07:14,240 --> 00:07:18,640 Speaker 1: to sort of quiz clients on whether they're sophisticated enough 144 00:07:18,800 --> 00:07:22,080 Speaker 1: to to understand what's going on in leveraged and and 145 00:07:22,120 --> 00:07:24,840 Speaker 1: I suppose inverse ETFs as well. Could you sort of 146 00:07:24,880 --> 00:07:27,800 Speaker 1: get us up to date on where that UM debate 147 00:07:27,920 --> 00:07:31,160 Speaker 1: stands right now? I know the SEC is still accepting 148 00:07:31,240 --> 00:07:34,120 Speaker 1: comments about this, Is that right? Yeah? I'm not actually 149 00:07:34,120 --> 00:07:36,400 Speaker 1: not really the right person at the firm to to 150 00:07:36,520 --> 00:07:39,600 Speaker 1: talk about the current proposals. You know. What I can tell, 151 00:07:39,680 --> 00:07:42,040 Speaker 1: of course, is that leverage and reverse ETFs have been 152 00:07:42,080 --> 00:07:45,160 Speaker 1: around for quite a while and have been valuable tools 153 00:07:45,160 --> 00:07:49,000 Speaker 1: for investors for UM both hedging positions in their portfolio 154 00:07:49,280 --> 00:07:51,960 Speaker 1: looking for opportunities where they have particular points of views 155 00:07:51,960 --> 00:07:54,600 Speaker 1: have been valuable tools. But unfortunately I'm not the right 156 00:07:54,640 --> 00:07:57,080 Speaker 1: person at the firm to be talking about the updates 157 00:07:57,160 --> 00:07:59,600 Speaker 1: on on what's going on with the proposal. I can 158 00:07:59,600 --> 00:08:02,960 Speaker 1: type it that. So this is something that we've been 159 00:08:02,960 --> 00:08:05,360 Speaker 1: following quite closely for actually for a couple of years. 160 00:08:05,360 --> 00:08:08,280 Speaker 1: This is kind of part of this long thought out 161 00:08:08,360 --> 00:08:10,840 Speaker 1: derivatives proposal that the SEC has been mulling over for 162 00:08:10,880 --> 00:08:13,000 Speaker 1: a while, and they finally came out towards the end 163 00:08:13,040 --> 00:08:15,360 Speaker 1: of last year with some proposals and a sort of 164 00:08:15,400 --> 00:08:18,119 Speaker 1: carve out provision from the Derivative's rule that would apply 165 00:08:18,200 --> 00:08:20,960 Speaker 1: to to leverage funds. And what they've kind of suggested 166 00:08:21,080 --> 00:08:23,360 Speaker 1: is this kind of give with one hand, take with 167 00:08:23,400 --> 00:08:26,080 Speaker 1: the other kind of approach in that they are proposing 168 00:08:26,440 --> 00:08:30,040 Speaker 1: lifting what has essentially been a moratorium on new issuers 169 00:08:30,040 --> 00:08:33,679 Speaker 1: of leverage products. So prohas, for example and its competitive direction, 170 00:08:33,679 --> 00:08:35,960 Speaker 1: have been able to sell a leverage products, but we 171 00:08:36,000 --> 00:08:38,320 Speaker 1: haven't seen any new issues being able to come into 172 00:08:38,320 --> 00:08:41,439 Speaker 1: the space for since I think around. So they're proposing 173 00:08:41,559 --> 00:08:44,320 Speaker 1: lifting that moratorium. But the downside is that they do 174 00:08:44,360 --> 00:08:46,520 Speaker 1: want these From an issue perspective, the downside is that 175 00:08:46,559 --> 00:08:50,120 Speaker 1: they do want these greater controls at the point of sale. 176 00:08:50,480 --> 00:08:54,840 Speaker 1: So for the brokerages that maybe selling these leverage products, 177 00:08:54,840 --> 00:08:57,400 Speaker 1: they would have to ensure that they're the client has 178 00:08:57,440 --> 00:09:00,400 Speaker 1: a certain degree of sophistication, that they have a certain 179 00:09:00,480 --> 00:09:02,559 Speaker 1: number of assets that they have a certain level of 180 00:09:02,640 --> 00:09:05,559 Speaker 1: understanding before they are able to it's green lighter a 181 00:09:05,640 --> 00:09:08,040 Speaker 1: sale of that of those products. So the SEC has 182 00:09:08,080 --> 00:09:10,640 Speaker 1: been collecting comments on this process has been quite interesting 183 00:09:10,640 --> 00:09:12,319 Speaker 1: in this space, and that they did come out and 184 00:09:12,640 --> 00:09:16,160 Speaker 1: encourage their shareholders to actually respond to the SEC and 185 00:09:16,360 --> 00:09:18,920 Speaker 1: to give their thoughts on this process. But it's still 186 00:09:18,960 --> 00:09:21,360 Speaker 1: something that's kind of um your ongoing and the SEC 187 00:09:21,559 --> 00:09:23,720 Speaker 1: has yet come out with a final proposal. You know 188 00:09:23,720 --> 00:09:27,400 Speaker 1: what I find interesting, Rachel's if I want to so 189 00:09:27,440 --> 00:09:29,240 Speaker 1: the way I envisioned this is if I lag onto 190 00:09:29,280 --> 00:09:33,120 Speaker 1: my E trade or my uh, you know, a marriage 191 00:09:33,120 --> 00:09:36,199 Speaker 1: trade account, and I try to buy a levered e 192 00:09:36,320 --> 00:09:38,320 Speaker 1: t F, I'll get some sort of pop up saying 193 00:09:38,320 --> 00:09:41,199 Speaker 1: you have to answer these questions. I don't correct me 194 00:09:41,240 --> 00:09:42,559 Speaker 1: if I'm wrong, but I don't think the same is 195 00:09:42,600 --> 00:09:44,640 Speaker 1: true if say I want to open a margin account 196 00:09:44,760 --> 00:09:49,240 Speaker 1: or want to start short selling stocks over the same platform. Um, 197 00:09:49,720 --> 00:09:52,240 Speaker 1: So I wonder if would that be a next step. 198 00:09:52,240 --> 00:09:54,280 Speaker 1: Do you think that that they would sort of start 199 00:09:54,280 --> 00:09:56,440 Speaker 1: cracking down on that as well. So there's an interesting 200 00:09:56,480 --> 00:09:59,480 Speaker 1: thing we've kind of purchasing leverage products already and that 201 00:09:59,559 --> 00:10:02,000 Speaker 1: you do times have a few boxes to go through 202 00:10:02,080 --> 00:10:04,680 Speaker 1: already without having these extra kind of provisions that the 203 00:10:04,760 --> 00:10:07,480 Speaker 1: SEC is contemplating in place. Um. You know, some people 204 00:10:07,520 --> 00:10:09,400 Speaker 1: will have a box that you kind of have to tick, 205 00:10:09,720 --> 00:10:13,800 Speaker 1: but there isn't for an options based contract. You would 206 00:10:13,840 --> 00:10:17,160 Speaker 1: have to actually get documents through the mail, sign them, 207 00:10:17,160 --> 00:10:19,480 Speaker 1: film all in, send them back. There's no kind of 208 00:10:19,800 --> 00:10:22,760 Speaker 1: um level UM like that that applies for leverage products, 209 00:10:22,800 --> 00:10:24,680 Speaker 1: and the argument goes that, you know, if you have 210 00:10:24,760 --> 00:10:28,280 Speaker 1: products that have options embedded or other derivatives embedded, maybe 211 00:10:28,280 --> 00:10:30,640 Speaker 1: there should be kind of a similar sort of process 212 00:10:30,640 --> 00:10:32,640 Speaker 1: to ensure that you understand in the same way that 213 00:10:32,679 --> 00:10:35,320 Speaker 1: there is for the more complex, um, you know, purchases 214 00:10:35,320 --> 00:10:37,400 Speaker 1: of derivatives. UM. So I think it's going to be 215 00:10:37,440 --> 00:10:40,000 Speaker 1: interesting to see, um, you know, kind of like how 216 00:10:40,120 --> 00:10:42,200 Speaker 1: the SEC sort of goes from here, whether this is 217 00:10:42,240 --> 00:10:45,920 Speaker 1: sort of the further edge of their kind of policy making. 218 00:10:46,000 --> 00:10:48,560 Speaker 1: Because let's remember this is a proposal, this is not 219 00:10:48,640 --> 00:10:51,120 Speaker 1: kind of written in stone and these things. Looking at 220 00:10:51,120 --> 00:10:53,920 Speaker 1: what the different commissioners from the SEC have come out 221 00:10:53,960 --> 00:10:56,520 Speaker 1: and said on this, there is clearly some division between 222 00:10:56,559 --> 00:10:58,880 Speaker 1: the sort of republican and democratly and in commissioners, and 223 00:10:58,880 --> 00:11:00,800 Speaker 1: this is a bit of a dialogue. Here's a little 224 00:11:00,800 --> 00:11:03,080 Speaker 1: bit of a given take here. So I think it's 225 00:11:03,080 --> 00:11:05,960 Speaker 1: hard to say at this stage whether things veer towards 226 00:11:06,280 --> 00:11:09,040 Speaker 1: the you know, increasing kind of client checks and that 227 00:11:09,280 --> 00:11:12,840 Speaker 1: becoming more and more something we see expanded to other markets, 228 00:11:13,000 --> 00:11:14,800 Speaker 1: whether actually it kind of reigns back and they find 229 00:11:14,800 --> 00:11:16,760 Speaker 1: a middle ground where maybe we see it a little 230 00:11:16,760 --> 00:11:19,560 Speaker 1: bit more required, but not quite what's being contemplated at 231 00:11:19,559 --> 00:11:22,280 Speaker 1: the moment, so simeon regardless of what's going on in 232 00:11:22,400 --> 00:11:26,720 Speaker 1: the regulatory arena. Some of the leverage for leveraged funds 233 00:11:26,720 --> 00:11:28,600 Speaker 1: that you guys are well known for our the pro 234 00:11:28,640 --> 00:11:31,840 Speaker 1: shairs aultopro triple q c q q Q. Then there's 235 00:11:31,840 --> 00:11:34,440 Speaker 1: the short version s q q Q. Can you walk 236 00:11:34,520 --> 00:11:38,400 Speaker 1: us through maybe how you typically see investors actually utilizing 237 00:11:38,840 --> 00:11:42,439 Speaker 1: your products? And then from your perspective as the head 238 00:11:42,480 --> 00:11:45,360 Speaker 1: of investment strategy, how do you actually go about having 239 00:11:45,360 --> 00:11:48,480 Speaker 1: conversations with investors as well about the right way to 240 00:11:48,559 --> 00:11:51,280 Speaker 1: actually put them to use. Yeah, I'll answer them in 241 00:11:51,280 --> 00:11:55,079 Speaker 1: two parts, because one with regards to the lever gtfs 242 00:11:55,120 --> 00:11:57,480 Speaker 1: and the leverage diniversity TFS. We have a ton of 243 00:11:57,640 --> 00:12:01,760 Speaker 1: education on our website to help people think about how 244 00:12:01,800 --> 00:12:05,600 Speaker 1: they can express different views and create portfolio constructions that 245 00:12:05,640 --> 00:12:07,319 Speaker 1: make sense and use them in a way that will 246 00:12:07,360 --> 00:12:11,320 Speaker 1: help them meet their objectives. UM but actually UM myself 247 00:12:11,400 --> 00:12:14,600 Speaker 1: and my team we spend most of our time talking 248 00:12:14,640 --> 00:12:18,360 Speaker 1: about um our our sort of for us traditional buying 249 00:12:18,400 --> 00:12:21,560 Speaker 1: whole strategies. In fact, our biggest et f UH today 250 00:12:21,600 --> 00:12:23,760 Speaker 1: over seven billion dollars has took your n O b 251 00:12:24,080 --> 00:12:27,199 Speaker 1: L which is the S and P five Dividend Aristocrats 252 00:12:27,240 --> 00:12:29,560 Speaker 1: e t f UM. So we talk about our suite 253 00:12:29,559 --> 00:12:32,840 Speaker 1: of a dividend growth ETFs UM more than just about 254 00:12:32,840 --> 00:12:35,240 Speaker 1: anything else on the platform these days. And in fact 255 00:12:35,240 --> 00:12:38,719 Speaker 1: it's very applicable to the current environment because companies that 256 00:12:39,040 --> 00:12:43,200 Speaker 1: consistently grow their dividends have you know, been a really 257 00:12:43,320 --> 00:12:47,520 Speaker 1: nice way to be able to UH participate reasonably well 258 00:12:47,520 --> 00:12:49,080 Speaker 1: when markets go up. But when you have a bad 259 00:12:49,200 --> 00:12:51,800 Speaker 1: quarter like we had in twenty eighteen, the down capture 260 00:12:51,840 --> 00:12:54,400 Speaker 1: the defensiveness has has worked very well as well. So 261 00:12:54,880 --> 00:12:57,960 Speaker 1: that's been a really UH core part of our conversations 262 00:12:58,040 --> 00:13:01,560 Speaker 1: with UH. With Financial Advisor is another clients for a 263 00:13:01,559 --> 00:13:04,160 Speaker 1: little while. Now I love the name of that, the Aristocrats. 264 00:13:04,760 --> 00:13:07,640 Speaker 1: What is it you have to have UH grown your 265 00:13:07,679 --> 00:13:10,240 Speaker 1: dividend for Is it twenty years going or something twenty 266 00:13:10,280 --> 00:13:13,360 Speaker 1: five for the large cap And we think we also 267 00:13:13,440 --> 00:13:15,520 Speaker 1: have ticker R e g L which is the SMP 268 00:13:15,600 --> 00:13:19,920 Speaker 1: four Aristocrats and SMDV the small cap And there's almost 269 00:13:19,960 --> 00:13:21,960 Speaker 1: a little bit of an interesting I don't want to 270 00:13:22,200 --> 00:13:25,360 Speaker 1: say more per se, but certainly an interesting opportunity with 271 00:13:25,440 --> 00:13:29,040 Speaker 1: mid and small caps because as we know, large caps 272 00:13:29,080 --> 00:13:31,480 Speaker 1: have run this market for a while, but it's perhaps 273 00:13:31,559 --> 00:13:34,720 Speaker 1: even a bigger has been a bigger impacted people. Note 274 00:13:35,040 --> 00:13:37,760 Speaker 1: over the last decade, on a price to book basis, 275 00:13:38,280 --> 00:13:40,679 Speaker 1: mid and small cap stocks have gone from parity to 276 00:13:40,760 --> 00:13:44,480 Speaker 1: the SMP five hundred to trading at a discount sixty 277 00:13:44,520 --> 00:13:46,640 Speaker 1: cents on the dollar. Now, the problem is there's a 278 00:13:46,679 --> 00:13:48,440 Speaker 1: lot of junk when you get down there, but you 279 00:13:48,480 --> 00:13:52,559 Speaker 1: resolve the junk problem if you invest in the dividend growers. 280 00:13:52,559 --> 00:13:55,520 Speaker 1: The consistent dividend growers and been small So uh, you know, 281 00:13:55,559 --> 00:13:57,640 Speaker 1: we've been talking not just about the flagship and O 282 00:13:57,760 --> 00:13:59,480 Speaker 1: b L, but also R E, g L and mid 283 00:13:59,520 --> 00:14:03,960 Speaker 1: cap and and SMGV and small, which resonates with folks. 284 00:14:03,960 --> 00:14:06,200 Speaker 1: You know, you're looking at the tape and wondering, things 285 00:14:06,280 --> 00:14:10,040 Speaker 1: keep going up, but I'm a little nervous night and 286 00:14:10,400 --> 00:14:12,600 Speaker 1: a nice alternative for that, things keep going up, but 287 00:14:12,640 --> 00:14:15,920 Speaker 1: I'm a little nervous state of mind. But but at 288 00:14:15,920 --> 00:14:17,520 Speaker 1: the same time, I want to ask because I feel 289 00:14:17,520 --> 00:14:20,360 Speaker 1: like we've almost been in the state of mind for 290 00:14:20,720 --> 00:14:23,680 Speaker 1: quite a while now, this idea that things keep going up, 291 00:14:23,680 --> 00:14:27,840 Speaker 1: but I'm pretty nervous. And with that We've heard multiple strategists, 292 00:14:27,880 --> 00:14:30,880 Speaker 1: portfolio managers, many people I've spoken to saying, all right, 293 00:14:30,880 --> 00:14:33,800 Speaker 1: so that means look at small caps, look at emerging markets, 294 00:14:33,840 --> 00:14:36,400 Speaker 1: look elsewhere, don't look at US large caps. But that's 295 00:14:36,400 --> 00:14:39,240 Speaker 1: just continues to be what keeps going up, and you 296 00:14:39,240 --> 00:14:43,440 Speaker 1: would imagine maybe making people more nervous. I mean, is 297 00:14:43,480 --> 00:14:48,400 Speaker 1: a solution really to keep going elsewhere even though it's 298 00:14:48,440 --> 00:14:51,120 Speaker 1: been roughly I guess a year now over that since 299 00:14:51,160 --> 00:14:55,440 Speaker 1: we had that correction in in which we did see 300 00:14:55,480 --> 00:14:58,520 Speaker 1: this performance continue. Yeah, So first, I'm kind of a 301 00:14:58,560 --> 00:15:03,760 Speaker 1: classic acid allocation. So yeah, somewhere between forty and of 302 00:15:03,800 --> 00:15:06,160 Speaker 1: your portfolio probably should be. US large caps are for 303 00:15:06,280 --> 00:15:08,000 Speaker 1: US investor, And if you love it, you have a 304 00:15:08,040 --> 00:15:09,760 Speaker 1: little more. If you hate, if you had at less. 305 00:15:10,040 --> 00:15:12,680 Speaker 1: And to put that in perspective, if you think about 306 00:15:12,720 --> 00:15:15,760 Speaker 1: the valuations of large caps, I don't get two worked 307 00:15:15,840 --> 00:15:18,600 Speaker 1: up because and you've you've all heard this many times before, 308 00:15:18,640 --> 00:15:20,760 Speaker 1: because how low interest rates are? You know, if you 309 00:15:20,880 --> 00:15:25,360 Speaker 1: plot the p the SMP five D guess interest rates 310 00:15:25,400 --> 00:15:27,360 Speaker 1: at a two percent ten yere you get a twenty 311 00:15:27,440 --> 00:15:30,080 Speaker 1: multiple and we're now one and a half times and 312 00:15:30,120 --> 00:15:33,080 Speaker 1: we're at somewhere around the twenty multiple. And by the way, 313 00:15:33,360 --> 00:15:35,960 Speaker 1: we're starting to have a little bit of earnings growth. 314 00:15:36,400 --> 00:15:39,440 Speaker 1: In Q four we had about one percent earnings growth 315 00:15:39,440 --> 00:15:41,840 Speaker 1: for the SMP five hundred, but if you take out energy, 316 00:15:42,960 --> 00:15:46,000 Speaker 1: you had actually over a four percent increase in earnings. 317 00:15:46,000 --> 00:15:48,800 Speaker 1: That's the first time in four quarters, and I would 318 00:15:48,880 --> 00:15:51,160 Speaker 1: argue it's it's a little bit of kind of this. 319 00:15:52,000 --> 00:15:53,960 Speaker 1: You have to follow the bouncing ball, but it's an 320 00:15:54,040 --> 00:15:57,480 Speaker 1: artifact of the corporate tax cut. The corporate tax cut 321 00:15:57,840 --> 00:16:01,720 Speaker 1: temporarily boosted margins in AN eighteen, but then for the 322 00:16:01,800 --> 00:16:04,440 Speaker 1: large part of twenty nineteen that started to be eroded 323 00:16:04,480 --> 00:16:08,120 Speaker 1: in price. Just like we learned in Freshman economics, the 324 00:16:08,160 --> 00:16:10,280 Speaker 1: tax cut went through price for a lot of companies 325 00:16:10,280 --> 00:16:13,080 Speaker 1: that are are price competitive where you don't have the 326 00:16:13,160 --> 00:16:16,040 Speaker 1: anniversary it anymore, using old retail speak. And in Q 327 00:16:16,280 --> 00:16:18,440 Speaker 1: four he started to see some earnings growth. So if 328 00:16:18,480 --> 00:16:21,280 Speaker 1: you put that together, it's not a terribly bearish story 329 00:16:21,840 --> 00:16:26,080 Speaker 1: for large caps, particularly when we're in this almost goldilocks 330 00:16:26,120 --> 00:16:30,520 Speaker 1: of two GDP growth. We have two percent GDP growth 331 00:16:30,560 --> 00:16:32,400 Speaker 1: because we have a very strong consumer in a middling 332 00:16:32,440 --> 00:16:35,680 Speaker 1: manufacturing sector, and that means the FED can't do anything 333 00:16:35,680 --> 00:16:37,480 Speaker 1: but we're growing just enough, so I don't want to 334 00:16:37,480 --> 00:16:40,000 Speaker 1: be I'm not I'm not a particular pessimist, such a 335 00:16:40,000 --> 00:16:42,400 Speaker 1: pessimist on large cap that you should dump all your 336 00:16:42,480 --> 00:16:44,760 Speaker 1: large cap and going to mid small emerging markets. But 337 00:16:44,800 --> 00:16:47,520 Speaker 1: it would absolutely agree with the notion that, as I mentioned, 338 00:16:47,520 --> 00:16:51,120 Speaker 1: there's a relative valuation opportunity in mid and small And 339 00:16:51,320 --> 00:16:53,360 Speaker 1: I'll pile onto the e M a little bit too. 340 00:16:53,400 --> 00:16:56,240 Speaker 1: One of the things that people I think, uh don't 341 00:16:56,320 --> 00:17:00,240 Speaker 1: are aren't as familiar with with regards to emerging markets box. 342 00:17:00,360 --> 00:17:02,080 Speaker 1: And by the way, we have ticker e M d V, 343 00:17:02,240 --> 00:17:04,200 Speaker 1: which is our dividend grower and e M as I 344 00:17:04,280 --> 00:17:06,200 Speaker 1: do a ticker check because that's part of my job. 345 00:17:10,000 --> 00:17:12,080 Speaker 1: That's where I'm an e t F. I gotta I 346 00:17:12,080 --> 00:17:14,600 Speaker 1: gotta put tickers out there. That's what we do. So 347 00:17:14,920 --> 00:17:19,840 Speaker 1: in emerging markets the quality is actually higher than in 348 00:17:19,920 --> 00:17:22,879 Speaker 1: developed markets. So in other words, margins and returns on 349 00:17:22,920 --> 00:17:26,199 Speaker 1: assets and equities are actually higher in e M. We 350 00:17:26,359 --> 00:17:29,920 Speaker 1: know that the virus isn't overhanging e M. We also 351 00:17:29,960 --> 00:17:33,159 Speaker 1: suspect there's stimulus coming along the way, not just from China, 352 00:17:33,240 --> 00:17:35,720 Speaker 1: but look, we even might get cut in the US 353 00:17:35,800 --> 00:17:38,560 Speaker 1: and that's always good for EM. And I think if 354 00:17:38,600 --> 00:17:41,800 Speaker 1: we see some stability and commodity prices, I know that's 355 00:17:41,800 --> 00:17:44,679 Speaker 1: a big if people looking at oil, copper and all that. Um, 356 00:17:44,720 --> 00:17:48,119 Speaker 1: there's an opportunity there. So I am. I am on 357 00:17:48,200 --> 00:17:51,040 Speaker 1: board with the notion that there's some relative value opportunities 358 00:17:51,040 --> 00:17:54,800 Speaker 1: in things like mid small and EM. But I don't 359 00:17:54,840 --> 00:17:58,040 Speaker 1: think valuations are that scary in in in core US 360 00:17:58,119 --> 00:18:03,520 Speaker 1: large cap pequitis either. Now, Ray sure Simeon sounds fairly optimistic, um, 361 00:18:03,560 --> 00:18:04,960 Speaker 1: but I know you were looking at some of the 362 00:18:04,960 --> 00:18:09,200 Speaker 1: flows into the pro shaares funds year to date. I'm 363 00:18:09,200 --> 00:18:11,760 Speaker 1: got to say that the money coming into the pro 364 00:18:11,800 --> 00:18:14,520 Speaker 1: shairs is does not look very optimistic. Tell us a 365 00:18:14,560 --> 00:18:17,240 Speaker 1: little bit about what the flows look like to you, Yeah, 366 00:18:17,280 --> 00:18:18,359 Speaker 1: I mean, it's all you always have to be a 367 00:18:18,400 --> 00:18:20,320 Speaker 1: little bit careful when you look at leverage funds and 368 00:18:20,320 --> 00:18:22,040 Speaker 1: flows because you do see a lot of people kind 369 00:18:22,040 --> 00:18:24,240 Speaker 1: of using these very much as getting get out kind 370 00:18:24,240 --> 00:18:26,360 Speaker 1: of trading vehicles. But there is a sign here. When 371 00:18:26,359 --> 00:18:28,919 Speaker 1: you see a flow, it means that people need more shares. Therefore, 372 00:18:28,960 --> 00:18:31,440 Speaker 1: more shares have been created because people want to use 373 00:18:31,440 --> 00:18:33,359 Speaker 1: that fund. And we've been seeing a lot of that 374 00:18:33,440 --> 00:18:35,960 Speaker 1: in s q q Q and in s H which 375 00:18:35,960 --> 00:18:39,040 Speaker 1: are two short funds, one against kind of the nasdack 376 00:18:39,160 --> 00:18:42,159 Speaker 1: and one against um that the SMP five hundred, And 377 00:18:42,160 --> 00:18:44,919 Speaker 1: that suggests to me that the people are hedging themselves 378 00:18:45,160 --> 00:18:48,840 Speaker 1: or betting against the current highs that we're seeing in 379 00:18:48,840 --> 00:18:51,639 Speaker 1: the SMP five and the NAZAC. We are starting to 380 00:18:51,680 --> 00:18:54,800 Speaker 1: see a little bit of signs that maybe we could 381 00:18:54,800 --> 00:18:57,359 Speaker 1: see a slight pullback in stocks. Been a couple of 382 00:18:57,400 --> 00:18:59,359 Speaker 1: wobbles this week, so I think it'll be kind of 383 00:18:59,359 --> 00:19:01,760 Speaker 1: interesting to see sort of whether those flows continue, whether 384 00:19:01,840 --> 00:19:03,560 Speaker 1: we see a little bit of reversal, if some of 385 00:19:03,560 --> 00:19:06,120 Speaker 1: the kind of froth is taken out of the market. Look, 386 00:19:06,160 --> 00:19:10,840 Speaker 1: I mean, people when the virus is creating volatility, and 387 00:19:11,000 --> 00:19:14,040 Speaker 1: you know, people always look for hedges and times of volatility. 388 00:19:14,960 --> 00:19:18,879 Speaker 1: It's not it's quite well known that after just about 389 00:19:18,880 --> 00:19:24,040 Speaker 1: every one of these UH pandemics epidemics viruses, you look 390 00:19:24,119 --> 00:19:25,960 Speaker 1: six to twelve months out the markets up. But in 391 00:19:26,000 --> 00:19:29,200 Speaker 1: the short run things can happen, uh you know, outside 392 00:19:29,240 --> 00:19:31,760 Speaker 1: of the of the opportunities that you discussed with with 393 00:19:31,840 --> 00:19:35,560 Speaker 1: our vehicles. I also point out a classic old school hedge, 394 00:19:35,600 --> 00:19:38,159 Speaker 1: you know, zero coupon bonds are up thirteen percent year 395 00:19:38,240 --> 00:19:43,160 Speaker 1: to date. The problem is with duration. All we need 396 00:19:43,200 --> 00:19:44,920 Speaker 1: is just to calm down and the ten year goes 397 00:19:44,960 --> 00:19:48,360 Speaker 1: back to two percent and you lost twelve So um 398 00:19:48,520 --> 00:19:51,040 Speaker 1: that but that's but that's something that that that's old 399 00:19:51,080 --> 00:19:53,760 Speaker 1: school heage right there, because you have the if the 400 00:19:53,840 --> 00:19:56,600 Speaker 1: virus um you know, really kicks in for all we know, 401 00:19:56,680 --> 00:19:59,479 Speaker 1: you could see a further rally and treasuries from our 402 00:19:59,520 --> 00:20:02,960 Speaker 1: perspective of we think in the medium term, you know, 403 00:20:03,040 --> 00:20:05,159 Speaker 1: the the odds of anything or a little bit of 404 00:20:05,359 --> 00:20:08,320 Speaker 1: uh you think of two percent on the tenure is 405 00:20:08,320 --> 00:20:11,000 Speaker 1: a normalization, but I guess it would be directionally normalization. 406 00:20:11,040 --> 00:20:13,720 Speaker 1: At this point. We've actually got a couple of interest 407 00:20:13,840 --> 00:20:16,520 Speaker 1: rate hedged um corporate bond e t f I G 408 00:20:16,760 --> 00:20:19,000 Speaker 1: h G is the it's our investment grade flavor and 409 00:20:19,200 --> 00:20:21,600 Speaker 1: h Y s G is high yield um and as 410 00:20:21,640 --> 00:20:23,400 Speaker 1: we had a little bit of movement out and spreads 411 00:20:23,560 --> 00:20:25,760 Speaker 1: if you want to take advantage of that, but hedge 412 00:20:25,760 --> 00:20:29,240 Speaker 1: out the treasury rate risk and just have the corporate piece. 413 00:20:29,359 --> 00:20:32,359 Speaker 1: That's it's almost like credit ARB light in uh IN 414 00:20:32,520 --> 00:20:34,960 Speaker 1: or a credit AR strategy and an index form that's 415 00:20:35,000 --> 00:20:53,800 Speaker 1: been something that put people have been talking about. So 416 00:20:54,480 --> 00:20:56,480 Speaker 1: mean to get back to that idea of asset allocation. 417 00:20:56,520 --> 00:21:00,199 Speaker 1: I think you said, what forty you'd be fort yous 418 00:21:00,280 --> 00:21:05,520 Speaker 1: large caps. What does the rest of your portfolio look like? Yeah, 419 00:21:05,560 --> 00:21:07,720 Speaker 1: so then you have your ear slug of midden small 420 00:21:07,880 --> 00:21:10,640 Speaker 1: on the order of you know, another ten or fifteen 421 00:21:10,640 --> 00:21:12,359 Speaker 1: and small. If I don't add up because I'm not 422 00:21:12,400 --> 00:21:15,000 Speaker 1: writing this down, don't hold it against me. Another ten 423 00:21:15,000 --> 00:21:17,600 Speaker 1: per sentence in uh in, five or ten percent in 424 00:21:17,640 --> 00:21:20,119 Speaker 1: small cap, and then something on the order of twenty 425 00:21:20,119 --> 00:21:23,480 Speaker 1: odd percent in developed international and another five decent percent 426 00:21:23,520 --> 00:21:26,800 Speaker 1: in emerging markets. From a baseline standpoint, So the way 427 00:21:26,800 --> 00:21:30,000 Speaker 1: the logic works, about half the world's equities are outside 428 00:21:30,040 --> 00:21:32,520 Speaker 1: the US. But if you're a US liability person, then 429 00:21:32,560 --> 00:21:35,080 Speaker 1: you should probably have about the US dollar liability person 430 00:21:35,080 --> 00:21:38,200 Speaker 1: who's have about six US broken out pro rata by 431 00:21:38,240 --> 00:21:42,240 Speaker 1: market cap, and then the international stuff about two thirds developed, 432 00:21:42,240 --> 00:21:45,560 Speaker 1: one third, one third emerging. Hey, we're journalists. You don't 433 00:21:45,560 --> 00:21:47,439 Speaker 1: have to worry about us doing math. We're not going 434 00:21:47,480 --> 00:21:52,280 Speaker 1: to check your math. You could take Yeah, I want to. 435 00:21:52,520 --> 00:21:55,000 Speaker 1: There's one of their opportunity that we've seen is sort 436 00:21:55,000 --> 00:21:57,280 Speaker 1: of a quasi sector opportunity that we've been talking a 437 00:21:57,280 --> 00:22:00,320 Speaker 1: lot about that UH, and that's in the infrastructure space. 438 00:22:00,720 --> 00:22:02,680 Speaker 1: I'll have to do another ticker because that's my job. 439 00:22:02,720 --> 00:22:05,840 Speaker 1: But our ticker is t O l Z, another clever 440 00:22:05,920 --> 00:22:10,000 Speaker 1: ticker because it's tolls like a toll taker. UM. The 441 00:22:10,119 --> 00:22:13,800 Speaker 1: UH the the infrastructure sector, and we follow the Brookfield 442 00:22:13,800 --> 00:22:17,359 Speaker 1: Index of owners and operators of the infrastructure assets. So 443 00:22:17,359 --> 00:22:20,560 Speaker 1: in other words, not the sort of construction company and 444 00:22:20,600 --> 00:22:22,680 Speaker 1: the and the drillers. These are the people who own 445 00:22:22,680 --> 00:22:25,280 Speaker 1: the assets, for example, cell phone towers and airports and 446 00:22:25,280 --> 00:22:29,680 Speaker 1: things like that. You're currently getting in that space two 447 00:22:29,720 --> 00:22:32,520 Speaker 1: times the yield of the SMP five hundred at only 448 00:22:32,600 --> 00:22:35,280 Speaker 1: two thirds the price to book, and you're actually getting 449 00:22:35,320 --> 00:22:38,359 Speaker 1: a hundred basis points more yield than utilities, which you know, 450 00:22:38,440 --> 00:22:40,520 Speaker 1: if if dawns go up at well, you really got 451 00:22:40,520 --> 00:22:42,720 Speaker 1: a problem there. So we think this is a clever 452 00:22:42,800 --> 00:22:47,440 Speaker 1: space because you own the assets, you're making money even 453 00:22:47,520 --> 00:22:50,679 Speaker 1: if there isn't the the long awaited infrastructure bill, and 454 00:22:50,680 --> 00:22:51,919 Speaker 1: if there was one, you have a little bit of 455 00:22:51,920 --> 00:22:54,200 Speaker 1: ticket to upside to UH. And a lot of people 456 00:22:54,240 --> 00:22:57,240 Speaker 1: have been talking to us about that sort of quasi 457 00:22:57,320 --> 00:23:01,960 Speaker 1: sector opportunity and infrastructure. UH is looking to get four 458 00:23:02,400 --> 00:23:05,040 Speaker 1: yield in this environment. Is it's hard to do even 459 00:23:05,040 --> 00:23:07,720 Speaker 1: in bonds right, A lot of politics talk, but it 460 00:23:07,760 --> 00:23:10,120 Speaker 1: will be very interesting over the next couple of years 461 00:23:10,160 --> 00:23:11,680 Speaker 1: if we do see both sides of the table to 462 00:23:11,800 --> 00:23:15,840 Speaker 1: come together for some type of infrastructure bill. But Mike, 463 00:23:15,840 --> 00:23:18,600 Speaker 1: before we get to the craziest thing, Rachel, let's move 464 00:23:18,640 --> 00:23:22,359 Speaker 1: into your new world of the currency space, because we 465 00:23:22,440 --> 00:23:26,280 Speaker 1: have seen some crazy moves there. The dollar just continuing 466 00:23:26,440 --> 00:23:29,560 Speaker 1: to outperform. It's pretty unbelievable. I'm pretty sure. In the 467 00:23:29,640 --> 00:23:32,000 Speaker 1: latest Bank of America fund managers survey they said and 468 00:23:32,080 --> 00:23:36,560 Speaker 1: at of those surveys said that the dollar is overvalued. 469 00:23:36,640 --> 00:23:38,159 Speaker 1: I think many people have said this for quite a 470 00:23:38,160 --> 00:23:40,000 Speaker 1: while now, but that's the second highest level since two 471 00:23:40,040 --> 00:23:42,439 Speaker 1: thousand and two, and at that we've also seen just 472 00:23:42,440 --> 00:23:46,320 Speaker 1: a complete breakdown in the end against the US dollar, 473 00:23:46,800 --> 00:23:49,600 Speaker 1: and this even as people are moving to safe havens 474 00:23:49,640 --> 00:23:53,600 Speaker 1: the like of gold elsewhere too. What is it about 475 00:23:53,600 --> 00:23:56,280 Speaker 1: this move and dollar yen that that's so different and 476 00:23:56,359 --> 00:23:58,879 Speaker 1: interesting right now? Yeah, this is huge irony is that 477 00:23:58,960 --> 00:24:01,400 Speaker 1: we've put this massive of risk off sentiment and yet 478 00:24:01,480 --> 00:24:03,639 Speaker 1: the end is not doing what we would expect the 479 00:24:03,800 --> 00:24:06,159 Speaker 1: END to do it as kind of a traditional safe haven, 480 00:24:06,480 --> 00:24:07,960 Speaker 1: and I think there's kind of like a number of 481 00:24:08,000 --> 00:24:10,520 Speaker 1: different factors that are are really playing into to to 482 00:24:10,600 --> 00:24:12,879 Speaker 1: the end's weakness there. You know, we've seen obviously, as 483 00:24:12,880 --> 00:24:14,719 Speaker 1: you mentioned, kind of this big dollar strength, and that's 484 00:24:14,800 --> 00:24:17,199 Speaker 1: kind of a move that's been fairly sort of broad based. 485 00:24:17,600 --> 00:24:19,600 Speaker 1: If you look at some of the dollar indexes, they're 486 00:24:19,600 --> 00:24:21,960 Speaker 1: pushing up on kind of significant levels, and one of 487 00:24:22,000 --> 00:24:24,400 Speaker 1: the dollar indexes is looking kind the hundred handle, which 488 00:24:24,400 --> 00:24:25,760 Speaker 1: is kind of as seen as a sort of yeah, 489 00:24:25,760 --> 00:24:28,080 Speaker 1: we love round numbers on the side of the table, 490 00:24:28,160 --> 00:24:30,159 Speaker 1: but yeah, I think that that is kind of an 491 00:24:30,240 --> 00:24:32,359 Speaker 1: interesting level that people are watching. So there is this 492 00:24:32,400 --> 00:24:34,120 Speaker 1: broad kind of strength. But I think when it comes 493 00:24:34,119 --> 00:24:36,879 Speaker 1: to Japan, there is both fears that kind of some 494 00:24:36,920 --> 00:24:40,520 Speaker 1: of the handling of the coronavirus, that the quarantining of 495 00:24:40,560 --> 00:24:42,880 Speaker 1: that cruise ship there, and kind of whether there could 496 00:24:42,920 --> 00:24:46,080 Speaker 1: be more of an outbreak um sort of within Japan proper, 497 00:24:46,400 --> 00:24:48,560 Speaker 1: whether that could kind of start to sort of pop 498 00:24:48,600 --> 00:24:50,320 Speaker 1: up in the news over the next few days. There 499 00:24:50,359 --> 00:24:53,080 Speaker 1: are signs of course there that the economy and growth 500 00:24:53,119 --> 00:24:55,080 Speaker 1: is not going to be um, you know, sort of 501 00:24:55,119 --> 00:24:57,199 Speaker 1: heading in the right direction, and that seems to be 502 00:24:57,200 --> 00:24:59,959 Speaker 1: another kind of thing that that's weighing on Japan sentiment 503 00:25:00,000 --> 00:25:02,000 Speaker 1: and UM. And then we are moving towards the end 504 00:25:02,040 --> 00:25:04,200 Speaker 1: of the fiscal year over there as well, so there's 505 00:25:04,280 --> 00:25:07,159 Speaker 1: a sense of reallocating sort of assets out out of 506 00:25:07,200 --> 00:25:10,000 Speaker 1: the year and into other attic into other currencies like 507 00:25:10,040 --> 00:25:12,919 Speaker 1: the dollar for example. UM, you actually do see this 508 00:25:12,960 --> 00:25:15,280 Speaker 1: crossing over into et F LAN just to bring to 509 00:25:15,280 --> 00:25:17,480 Speaker 1: bring it full circle, because we have seen there's a 510 00:25:17,600 --> 00:25:20,200 Speaker 1: JP Morgan fund. I'm out there b b JP, I 511 00:25:20,240 --> 00:25:22,640 Speaker 1: can play tickets to UM that that kind of has 512 00:25:22,680 --> 00:25:27,240 Speaker 1: been seeing big outfit somebody else's I'm sorry, I have 513 00:25:27,320 --> 00:25:30,040 Speaker 1: to have a broaden out but no, but we've seen big, 514 00:25:30,200 --> 00:25:32,560 Speaker 1: big outflows from there over the last um, you know, 515 00:25:32,680 --> 00:25:35,399 Speaker 1: a couple of days, a few weeks. Really that money 516 00:25:35,440 --> 00:25:38,800 Speaker 1: seems to be potentially moving into a European focus ETF. 517 00:25:39,160 --> 00:25:41,480 Speaker 1: When you look at kind of the holders of both 518 00:25:41,520 --> 00:25:44,360 Speaker 1: of those products, and there's one big goliath in the room. 519 00:25:44,440 --> 00:25:46,800 Speaker 1: JP Morgan itself is a very large holder of these 520 00:25:46,840 --> 00:25:48,879 Speaker 1: and we do see kind of these sorts of products 521 00:25:48,960 --> 00:25:51,320 Speaker 1: used by model portfolio it's and used to reallocate kind 522 00:25:51,320 --> 00:25:53,719 Speaker 1: of money at home. But I think it's interesting that 523 00:25:53,720 --> 00:25:55,400 Speaker 1: that this is kind of a not just a sort 524 00:25:55,400 --> 00:25:58,399 Speaker 1: of yen situation, but it's a kind of Japan situation 525 00:25:58,760 --> 00:26:00,639 Speaker 1: of just community. To see how that kind of plays 526 00:26:00,640 --> 00:26:03,879 Speaker 1: out over the next few days, particularly as we do 527 00:26:03,960 --> 00:26:07,119 Speaker 1: see kind of, you know, this move into other types 528 00:26:07,160 --> 00:26:08,680 Speaker 1: of havens. You know, we are seeing kind of the 529 00:26:08,720 --> 00:26:10,640 Speaker 1: movement to the dollar that seems to be a favorite 530 00:26:10,640 --> 00:26:14,000 Speaker 1: place gold, as you mentioned um and treasuries. You see 531 00:26:14,000 --> 00:26:15,680 Speaker 1: that in the et F space to g l D 532 00:26:15,920 --> 00:26:17,960 Speaker 1: I do very well. T LT, which is a longer 533 00:26:18,040 --> 00:26:20,800 Speaker 1: term treasury, is also getting influence. Yeah, I thought it was. 534 00:26:21,000 --> 00:26:23,680 Speaker 1: It was surprised me when the coronavirus started breaking out 535 00:26:23,680 --> 00:26:26,120 Speaker 1: in the end was rallying on this haven deband when 536 00:26:26,560 --> 00:26:30,240 Speaker 1: the main risk is right in Asia, you know, that's 537 00:26:30,720 --> 00:26:32,840 Speaker 1: the time when the end stops working. And you look 538 00:26:32,840 --> 00:26:36,359 Speaker 1: at the chart and the Asian financial crisis and it 539 00:26:36,400 --> 00:26:38,600 Speaker 1: wasn't very strong than either. So in Japan has already 540 00:26:38,600 --> 00:26:40,320 Speaker 1: been dealing with some of its own issues too at 541 00:26:40,400 --> 00:26:42,879 Speaker 1: that and then you introduced the coronavirus. So I think 542 00:26:42,960 --> 00:26:47,040 Speaker 1: this is just I'm amazed that people look to currencies 543 00:26:47,119 --> 00:26:51,359 Speaker 1: to headge equity market exposure because it's there's so many 544 00:26:51,400 --> 00:26:53,879 Speaker 1: moving parts, you know, the better answer is either an 545 00:26:53,880 --> 00:26:57,160 Speaker 1: explicit explicit hedge or the zero coupon bonds. At least 546 00:26:57,480 --> 00:27:00,159 Speaker 1: you know if that virus gets a heck of a 547 00:27:00,160 --> 00:27:01,879 Speaker 1: lot worse, that there's going to be a treasury rail. 548 00:27:01,960 --> 00:27:03,879 Speaker 1: The odds of that, I shouldn't say with certainty, but 549 00:27:03,920 --> 00:27:05,960 Speaker 1: the odds of that are much much higher than trying 550 00:27:05,960 --> 00:27:07,800 Speaker 1: to figure out if the end is gonna be too 551 00:27:07,800 --> 00:27:10,359 Speaker 1: safe haven. But the virus is on its shore, and 552 00:27:10,400 --> 00:27:12,480 Speaker 1: that to me, there's just too many moving parts there 553 00:27:12,480 --> 00:27:14,639 Speaker 1: to use that as a as a as a hedge 554 00:27:14,640 --> 00:27:18,000 Speaker 1: for other forms of risk in your portfolio. Okay, well, Simeon, 555 00:27:18,040 --> 00:27:20,760 Speaker 1: there is no haven from the craziest thing we saw 556 00:27:20,920 --> 00:27:24,280 Speaker 1: in markets. I don't know see what. I don't know 557 00:27:24,320 --> 00:27:27,200 Speaker 1: if they warned you about this gimmick of ours, but uh, 558 00:27:27,720 --> 00:27:30,520 Speaker 1: every week we we discussed the craziest things we've seen 559 00:27:31,080 --> 00:27:33,520 Speaker 1: in markets. This week, oddly enough, I tend to see 560 00:27:33,560 --> 00:27:36,080 Speaker 1: the craziest things. I'm just gonna go out and say that, Sarah. 561 00:27:36,119 --> 00:27:39,840 Speaker 1: I know that upset you. Mike thinks he wins every week, 562 00:27:39,880 --> 00:27:43,000 Speaker 1: sime In, but there are a very I would say 563 00:27:43,080 --> 00:27:48,560 Speaker 1: large group of people who would very much disagree. Some 564 00:27:48,680 --> 00:27:52,080 Speaker 1: haters coming out. But first I will say we we 565 00:27:52,160 --> 00:27:54,800 Speaker 1: did have someone waiting on Twitter. Before we get to that, 566 00:27:54,840 --> 00:27:56,359 Speaker 1: remember you can also give us a call at our 567 00:27:56,440 --> 00:27:59,560 Speaker 1: very own Bloomberg Podcast hotline, leave us a message, ask 568 00:27:59,640 --> 00:28:01,880 Speaker 1: us quite suestions, let us know about the craziest things 569 00:28:01,880 --> 00:28:04,000 Speaker 1: that you guys have seen in markets, and we might 570 00:28:04,040 --> 00:28:06,119 Speaker 1: even play your message on the show. So for that, 571 00:28:06,160 --> 00:28:09,639 Speaker 1: the number is six four six three to four three 572 00:28:09,920 --> 00:28:13,600 Speaker 1: four nine zero. But we did get a good way 573 00:28:13,640 --> 00:28:17,520 Speaker 1: in on Twitter. This one came from at j y Squall. 574 00:28:17,960 --> 00:28:23,040 Speaker 1: He said, when decentralized finance privacies defy discovers what flash 575 00:28:23,080 --> 00:28:27,359 Speaker 1: loans are used for? Yeah, Sarah, I'm gonna try to 576 00:28:27,359 --> 00:28:30,200 Speaker 1: explain this one, all right. This is this is kind 577 00:28:30,200 --> 00:28:32,800 Speaker 1: of like when dad makes dinner, though, so I might 578 00:28:32,840 --> 00:28:34,919 Speaker 1: I might burn this and you know, call the hotline 579 00:28:34,920 --> 00:28:37,479 Speaker 1: if I got this wrong. But basically he's talking about 580 00:28:37,520 --> 00:28:40,600 Speaker 1: this outfit b z X, which is sort of like 581 00:28:40,800 --> 00:28:44,600 Speaker 1: a peer to peer type of lender, but with crypto 582 00:28:44,960 --> 00:28:48,320 Speaker 1: and um what does all happens to pretty much every 583 00:28:48,320 --> 00:28:51,640 Speaker 1: crypto exchange eventually they get hacked, and this one got 584 00:28:51,640 --> 00:28:55,640 Speaker 1: hacked to the tune of six forty five thousand dollars, 585 00:28:55,680 --> 00:28:58,160 Speaker 1: which I think, as far as crypto hacks go is 586 00:28:58,160 --> 00:29:01,200 Speaker 1: is pretty much small potatoes, but still very interesting story. 587 00:29:01,240 --> 00:29:04,720 Speaker 1: And we thank j Y Squal if that indeed is 588 00:29:04,760 --> 00:29:07,000 Speaker 1: your real name, we thank you for the contribution. Have 589 00:29:07,040 --> 00:29:10,880 Speaker 1: a feeling maybe it's not Rachel. Do you have any 590 00:29:10,880 --> 00:29:15,400 Speaker 1: crazy observations? Well, my crazy observation is one that you 591 00:29:15,440 --> 00:29:17,560 Speaker 1: could probably have done last week as well. But I 592 00:29:17,640 --> 00:29:21,480 Speaker 1: mean watching Tesla, like because we saw that enormous, crazy, crazy, 593 00:29:21,480 --> 00:29:24,640 Speaker 1: crazy spike, um, and then it kind of rained back in. 594 00:29:24,800 --> 00:29:26,440 Speaker 1: Everyone was like, see told you it was a bubble, 595 00:29:26,600 --> 00:29:28,680 Speaker 1: and it's just been creeping higher and higher. And yesterday 596 00:29:28,760 --> 00:29:30,160 Speaker 1: kind of a week we went to a new kind 597 00:29:30,200 --> 00:29:31,880 Speaker 1: of I don't think it was quite the high, but 598 00:29:31,880 --> 00:29:33,800 Speaker 1: we were back around that kind of nine fifty level. 599 00:29:34,040 --> 00:29:36,240 Speaker 1: So that to me is really fascinating. Um. I know, 600 00:29:36,280 --> 00:29:38,080 Speaker 1: there was a lot of talk we initially saw that 601 00:29:38,120 --> 00:29:40,480 Speaker 1: spike about whether you could overlay that the Tesla stock 602 00:29:40,520 --> 00:29:42,720 Speaker 1: price with bitcoin, and there was a lot of like, no, no, 603 00:29:42,840 --> 00:29:45,040 Speaker 1: these are very very different in this, but seriously, try 604 00:29:45,080 --> 00:29:48,920 Speaker 1: it a little bit. Scary is a perennial favorite of 605 00:29:48,960 --> 00:29:52,200 Speaker 1: the last couple of weeks price target this week of 606 00:29:53,360 --> 00:29:58,600 Speaker 1: a share within minutes, essentially tesliterating above nine dollars a share. 607 00:29:59,680 --> 00:30:01,680 Speaker 1: I'll share my crazy thing because it's very much a 608 00:30:01,680 --> 00:30:04,640 Speaker 1: compliment to Tesla. I've been living in this space lately. 609 00:30:04,640 --> 00:30:07,720 Speaker 1: I've actually been working Asia hours to help out throughout 610 00:30:07,720 --> 00:30:11,160 Speaker 1: the coronavirus, so my US daylight hours to search for 611 00:30:11,200 --> 00:30:14,800 Speaker 1: crazy things have been somewhat limited. But one that's been 612 00:30:14,840 --> 00:30:17,160 Speaker 1: a clear favorite over the past week has been Virgin Galactic. 613 00:30:17,720 --> 00:30:24,520 Speaker 1: Unbelievable similar space as Tesla the tickers SPC, but similar 614 00:30:24,560 --> 00:30:26,080 Speaker 1: space when it comes to movements. I mean, this is 615 00:30:26,080 --> 00:30:29,720 Speaker 1: a stock that's now up two your date up one 616 00:30:31,240 --> 00:30:35,480 Speaker 1: in February alone. Uh So we're just seeing these odd, eccentric, 617 00:30:35,720 --> 00:30:42,320 Speaker 1: crazy steep moves across the stock market in very weird 618 00:30:42,720 --> 00:30:45,480 Speaker 1: and I'm not weird, but favorites that stocks going to 619 00:30:45,480 --> 00:30:51,080 Speaker 1: the moon. So Penny Simeon, I know we we booked 620 00:30:51,120 --> 00:30:53,160 Speaker 1: you last minute, but did you have a chance to 621 00:30:53,800 --> 00:30:56,640 Speaker 1: I came up with one. So this is a little 622 00:30:56,680 --> 00:31:00,560 Speaker 1: old school and you have to say yeah, you have 623 00:31:00,640 --> 00:31:03,880 Speaker 1: to say it in measured tones because strategists always refer 624 00:31:03,960 --> 00:31:07,240 Speaker 1: to this in measured tones. I've been watching the Baltic 625 00:31:07,480 --> 00:31:12,600 Speaker 1: Dry in that you have to explain it in that 626 00:31:12,680 --> 00:31:15,560 Speaker 1: voice the whole time. Yes, yes, yes, the Baltic Dry Index. 627 00:31:15,600 --> 00:31:18,680 Speaker 1: That's the dry container shipping index. It's down eighty percent, 628 00:31:18,960 --> 00:31:23,160 Speaker 1: eighty percent from hundred to five hundred. The the sort 629 00:31:23,200 --> 00:31:26,440 Speaker 1: of what fived means, don't worry about it. But it's 630 00:31:26,480 --> 00:31:28,480 Speaker 1: down eighty percent, and by the way, that is now 631 00:31:28,960 --> 00:31:34,400 Speaker 1: the depths of the crisis level. So that's kind of nutty. Uh. 632 00:31:34,800 --> 00:31:37,400 Speaker 1: Some people think it's a recession signal. It's obviously much 633 00:31:37,440 --> 00:31:40,240 Speaker 1: more about the coronavirus and the immediate impact to uh 634 00:31:40,320 --> 00:31:43,400 Speaker 1: some of the commodities markets. But that that's huge, a big, 635 00:31:43,400 --> 00:31:44,959 Speaker 1: big move. So I don't know if that would win 636 00:31:45,000 --> 00:31:46,720 Speaker 1: me any prize, but it caught my eyes. I'll tell 637 00:31:46,720 --> 00:31:49,240 Speaker 1: you what I mean. I like the Baltic Dry a lot. 638 00:31:49,320 --> 00:31:51,400 Speaker 1: The only reason I will not award you apprize to 639 00:31:51,480 --> 00:31:53,520 Speaker 1: that is that I I that was one of my 640 00:31:53,560 --> 00:31:59,680 Speaker 1: crazy things last week. I listened to a couple of them. 641 00:31:59,720 --> 00:32:03,000 Speaker 1: Quick believe that I didn't catch that one. So it's okay. Alright, Well, 642 00:32:03,040 --> 00:32:04,800 Speaker 1: Mike set him up pretty strong, and I want to 643 00:32:04,840 --> 00:32:10,360 Speaker 1: say before you get started, because Andrea on LinkedIn reached 644 00:32:10,400 --> 00:32:13,800 Speaker 1: out and he said, Sarah, please make sure Mike sticks 645 00:32:13,800 --> 00:32:17,000 Speaker 1: to finance related topics when debating the craziest thing in markets. 646 00:32:17,360 --> 00:32:20,800 Speaker 1: No more vintage bikes or like occurrences. So Mike, you 647 00:32:20,920 --> 00:32:24,360 Speaker 1: better stay honest. Alright, alright, that's fair, that's a fair LinkedIn. 648 00:32:24,400 --> 00:32:26,440 Speaker 1: All of a sudden, we're getting trolled on linked over. 649 00:32:26,880 --> 00:32:29,840 Speaker 1: What is going on? Man? That that'll teach me to 650 00:32:29,840 --> 00:32:32,920 Speaker 1: post on LinkedIn? I gotta say, But now I can 651 00:32:33,000 --> 00:32:36,360 Speaker 1: reveal the winner of the craziest thing we saw markets 652 00:32:36,360 --> 00:32:39,000 Speaker 1: this week, And sir, with all honestly, Rachel, if you 653 00:32:39,160 --> 00:32:42,640 Speaker 1: disagree that this is not the craziest thing, please speak up. 654 00:32:42,760 --> 00:32:47,840 Speaker 1: It's like handing Rachel attend bill. However, we've all heard 655 00:32:47,840 --> 00:32:51,440 Speaker 1: of this company Facebook, right, uh sillion market cap and 656 00:32:51,440 --> 00:32:54,560 Speaker 1: one of the most important companies out there. So there's 657 00:32:54,600 --> 00:32:58,000 Speaker 1: a new book out called Facebook The Inside Story, written 658 00:32:58,000 --> 00:33:02,520 Speaker 1: by a long time technology journalist named Stephen Leavy. There 659 00:33:02,560 --> 00:33:06,040 Speaker 1: was a good review in it this week in Business Week, 660 00:33:06,760 --> 00:33:10,560 Speaker 1: sie book on the history of Facebook. There's one line 661 00:33:10,560 --> 00:33:14,520 Speaker 1: in this review, buried deep inside the review that has 662 00:33:14,560 --> 00:33:18,080 Speaker 1: caught fire on social media in the press, even the 663 00:33:18,080 --> 00:33:19,920 Speaker 1: New York post. You know, if it shows up in 664 00:33:19,960 --> 00:33:22,440 Speaker 1: the New York Post, it's a crazy thing. And it 665 00:33:22,560 --> 00:33:28,560 Speaker 1: is this. Apparently, Mark Zuckerberg suffers from severe perspiration when 666 00:33:28,640 --> 00:33:33,160 Speaker 1: he speaks at public events. So to eliminate the I guess, 667 00:33:33,160 --> 00:33:37,840 Speaker 1: to eliminate the threat of armpit stains, he has an executive, 668 00:33:37,960 --> 00:33:41,800 Speaker 1: they say, an executive, not just some intern, an executive 669 00:33:41,800 --> 00:33:45,160 Speaker 1: in the communications department at Facebook comes and blow dries 670 00:33:45,280 --> 00:33:49,880 Speaker 1: his armpits before public speeches. Blow drives with heat. Wouldn't 671 00:33:49,880 --> 00:33:53,760 Speaker 1: that make it worse? That's why. That's what I was wondering, 672 00:33:53,760 --> 00:33:55,600 Speaker 1: because I sorry, I kind of live in a glass 673 00:33:55,600 --> 00:33:58,040 Speaker 1: house when it comes to having perspiration, you know. I 674 00:33:58,040 --> 00:34:00,600 Speaker 1: think this is why our producer toof are always seats 675 00:34:00,640 --> 00:34:02,680 Speaker 1: the guests on the opposite side of the table. For me, 676 00:34:03,600 --> 00:34:08,200 Speaker 1: I would assume that blow drying your pits would make 677 00:34:08,200 --> 00:34:09,719 Speaker 1: it worse. Yeah, but I can maybe they put it 678 00:34:09,760 --> 00:34:11,640 Speaker 1: on the cool settings. But I'm thinking I don't know 679 00:34:11,640 --> 00:34:13,560 Speaker 1: how to be on the cool setting right, Um, But 680 00:34:13,560 --> 00:34:15,239 Speaker 1: I just I guess I'll have to try it. I 681 00:34:15,280 --> 00:34:17,560 Speaker 1: don't know. I might start blow drying my pits, but 682 00:34:17,600 --> 00:34:19,080 Speaker 1: I don't think I can get an executive in the 683 00:34:19,080 --> 00:34:21,000 Speaker 1: company to do it for me? I think Mark, come on, man, 684 00:34:21,000 --> 00:34:22,839 Speaker 1: you gotta blow dry your own pits. I think that's 685 00:34:22,840 --> 00:34:27,279 Speaker 1: illegal these days, right, right, exactly? I mean, how much 686 00:34:27,320 --> 00:34:29,000 Speaker 1: do you have to get paid to blow dry another 687 00:34:29,040 --> 00:34:31,520 Speaker 1: guy's arm pits if they're an executive? It's an important job, 688 00:34:32,440 --> 00:34:36,160 Speaker 1: very important job, all right, the chief officer in charge 689 00:34:36,200 --> 00:34:39,799 Speaker 1: of dry armpits? All right, Rachel does Mike win? I 690 00:34:39,800 --> 00:34:43,880 Speaker 1: don't know, would we say that's markets? Facebook is one 691 00:34:43,880 --> 00:34:48,000 Speaker 1: of the most important stars. But did anything happen with Facebook? 692 00:34:48,440 --> 00:34:50,759 Speaker 1: Keep it on that that share price? All right? We will, 693 00:34:51,160 --> 00:34:56,120 Speaker 1: and we'll blame We'll blame Spotty Pitts. Alright with that, Simeon, 694 00:34:56,200 --> 00:34:58,440 Speaker 1: thank you so much for joining us, and Rachel thinks 695 00:34:58,480 --> 00:35:07,799 Speaker 1: so much for coming on the show. Thank you. What 696 00:35:07,960 --> 00:35:10,799 Speaker 1: goes up? We'll be back next week. Until then, you 697 00:35:10,840 --> 00:35:13,440 Speaker 1: can find us on the Bloomberg Terminal website and app 698 00:35:13,640 --> 00:35:16,520 Speaker 1: or wherever you get your podcasts. We'd love it if 699 00:35:16,560 --> 00:35:18,399 Speaker 1: you took the time to rate and review the show 700 00:35:18,440 --> 00:35:21,600 Speaker 1: on Apple podcast so more listeners can find us. And 701 00:35:21,719 --> 00:35:24,600 Speaker 1: you can find us on Twitter, follow me at Sarah 702 00:35:24,640 --> 00:35:28,040 Speaker 1: pon Seck. Mike is a reaganymous and Rachel Evans is 703 00:35:28,080 --> 00:35:31,640 Speaker 1: at Rachel Evans Underscore and Why. You can also follow 704 00:35:31,680 --> 00:35:35,480 Speaker 1: Bloomberg Podcasts at podcasts. What Goes Up is produced by 705 00:35:35,520 --> 00:35:39,280 Speaker 1: Topur foreheads ahead of Bloomberg podcast is Francesco Levie. Thanks 706 00:35:39,280 --> 00:35:40,560 Speaker 1: for listening, See you next time.