Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside
Speaker 1: my co host Matt Miller. Every business day we bring
Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along
Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and
Speaker 1: at Bloomberg dot com slash podcast. We've got the threat
Speaker 1: of recession either here or looming. But on the other hand,
Speaker 1: we have pretty much a fully employed economy. The consumer
Speaker 1: seems pretty decent. I like to look to the retailers
Speaker 1: to get a sense of how the consumers doing, and
Speaker 1: we've got a great round table now. Pudum Goyle analysts
Speaker 1: for e commerce at leisure whatever that is an off
Speaker 1: price retail for Bloomberg Intelligence here in the U S.
Speaker 1: And Deb Bacon. She's a senior analyst of luxury goods
Speaker 1: and beauty home care with Bloomberg Intelligence. She's based in London. Deb.
Speaker 1: I want to talk start with you Audie Das as
Speaker 1: we say it in Europe, okay, named for Addie Dosler.
Speaker 1: Thank you very much for pronouncing correctly. You're very You're
Speaker 1: very welcome. Starts are today They had their earnings were
Speaker 1: a little disappointing. Give us the latest on Adidas debin
Speaker 1: you there, deb dear deb Hello, Hello, Hello, I am
Speaker 1: I am. But actually that punum stock and she's online,
Speaker 1: so excellent. Yeah, yeah, we'll just start. Let's start with
Speaker 1: you in Europe. How are things going through the consumer?
Speaker 1: Tell Gucci we can go to Gucci. Then Gucci had
Speaker 1: something because yeah we can't. Sorry, I right, okay, so
Speaker 1: UM if I if I focused on Karen, Um, so
Speaker 1: scaring is the order of Gucci for those listeners who
Speaker 1: don't know. I didn't know that. Yeah, yes, so Karen
Speaker 1: makes well over Sorry, so Gucci makes well over fifty
Speaker 1: of UM sales at the Kuren group. And then you
Speaker 1: have the brands in there like San Lauran, Balence, t Jaga, Botego, Vanetta.
Speaker 1: But Gucci is by far the biggest brand and also
Speaker 1: very much so the biggest mix in terms of profitability.
Speaker 1: So um, what we saw last night from Paris was
Speaker 1: fourteen percent organic sales growth and even twenty three percent
Speaker 1: when we add in Forex game, which looked great on
Speaker 1: the top line and was beat stock down today, UM
Speaker 1: stocked down and soft overall, bringing the sector down and
Speaker 1: very much it's overshadowed by Gucci brand softness. The idea
Speaker 1: here is that there was a question in the market
Speaker 1: place on where the Gucci became too much fashion orientated.
Speaker 1: So the idea is really to elevate the brand to
Speaker 1: the levels that we see within some of the LVMH
Speaker 1: with a ton another portfolio as Christian Your and also MS.
Speaker 1: Both of those had knockout results in the last week
Speaker 1: or so. Has been a problem, not just this quarter right,
Speaker 1: It's been a problem for a number of reporting periods.
Speaker 1: It has And if we look pre COVID, they went
Speaker 1: through a two year program where they really reorganized Gucci,
Speaker 1: had big collaborations, lots and lots the new design very
Speaker 1: good and ready to wear and footbear and others, and
Speaker 1: they were seeing four percent plus growth. So when you
Speaker 1: look at it on a three year stack base, it's
Speaker 1: still very very solid growth. But what we saw in
Speaker 1: the Q three overall is that actually Gucci came in
Speaker 1: at nine percent growth and if I give you two
Speaker 1: comps on that, that compares against your major nine and
Speaker 1: them as a percent. And the view is that it's
Speaker 1: going to be costly for them to really bring this
Speaker 1: brand back up to day. It's not passing on the
Speaker 1: price in the US though Europe was huge for them
Speaker 1: because the US are traveling there and using dollar benefit.
Speaker 1: And then in China, it's got a new team coming
Speaker 1: in and the branch just seems to have lost its fears.
Speaker 1: So I put them want to bring you in here
Speaker 1: on Adidas, I see the start trading afterday some problems
Speaker 1: with China. Yeah, absolutely no. China continues to be an
Speaker 1: important area for the ath leisure companies Adidas as well,
Speaker 1: and um, it's continued to be weak. Um, there's no
Speaker 1: sign of recovery there, which is a big risk for
Speaker 1: not only Adidas but also Nike and the other brands
Speaker 1: that have a larger presence there for growth. Um, we
Speaker 1: don't know when China will recover, but we do know
Speaker 1: that comparisons get easier as we move into the next
Speaker 1: fiscal year and hopefully that should help at least show
Speaker 1: better numbers. But that said, with the COVID lockdowns, China
Speaker 1: still remains a big wild card for these retailers. But
Speaker 1: it's not just China that's a concern for Adidas here.
Speaker 1: I think the bigger concern really for US is the
Speaker 1: weakness that we're seeing in the Western markets with the
Speaker 1: inventory build up and and that's causing some major concern
Speaker 1: um for the brand and also for rivals. By the way,
Speaker 1: are they still working together with ya formerly known as
Speaker 1: Kanye West tweets At the moment, the collaboration is still
Speaker 1: intact and under review, so we know that. You know,
Speaker 1: he has seen a lot of collaborations kind of go
Speaker 1: off recently and Adidas was reviewing that. So but so
Speaker 1: far as the Germans are willing to work with him
Speaker 1: at the moment, it's under review. Yes, Hey, talk to
Speaker 1: us about just luxury in general by thirty seconds, so
Speaker 1: dependent upon China. But if China is not going to
Speaker 1: be China for a while during this covered lockdowns, how
Speaker 1: big of a head winners after just luxury in general?
Speaker 1: I think, Um, you know, if you've got the brands
Speaker 1: out in China, then there are ways for the consumer.
Speaker 1: If the brand is hot, the consumer is picking up.
Speaker 1: So for UM, if we think about for Louisa, Tom
Speaker 1: for the Yore, for UM, for MS brand overalls, they
Speaker 1: were really positive on China. What they're saying though is
Speaker 1: that there are some lockdown still, but where stores are
Speaker 1: open it's back to double digit growth and that started
Speaker 1: up from June through July. But if I think about
Speaker 1: other areas, um, we also had last night. Loreal, for example,
Speaker 1: have big skincare market in China and it's still not
Speaker 1: back the market. They said it's down three for beauty.
Speaker 1: Um there are there are positive eight there are still
Speaker 1: issues in this brand by brand right good stuff? All right?
Speaker 1: Love getting that retail round up if you will put
Speaker 1: them goil She's retail analyst for Bloomberg Intelligence based in Princeton,
Speaker 1: New Jersey, and deb Ache and retail analysts for Bloomberg
Speaker 1: Intelligence based in London, covering all things retail over there,
Speaker 1: plus the luxury sector, which it just continues to chug on.
Speaker 1: Think about this group, your principal investment banking and Morgan
Speaker 1: Stanley are a pretty standard job head of investment banking
Speaker 1: a's c IBC. It's a good standard job. That's a
Speaker 1: good gig. But then you go your portfolio manager at
Speaker 1: s A C Capital. I mean it's like you're a banker,
Speaker 1: but then you're a trader with Stevie Cohen Master. Who
Speaker 1: does that? I mean, who does that? Our next guest
Speaker 1: did that, Jay Hatfield CEO, founder and portfolio manager Infrastructure
Speaker 1: Capital Management. I have no idea what this guy does
Speaker 1: for a living, but I want to. I know they've
Speaker 1: got a lot of eats. They make e t f s,
Speaker 1: and one of the e t f s is the
Speaker 1: I don't know, they do energy stuff like that. The
Speaker 1: energy space has been so out of favor J for
Speaker 1: so long and it's like a minuscule four percent of
Speaker 1: the SMP five fund. When I started the business, it
Speaker 1: was rocking energy. Now it's nothing, but it's had a
Speaker 1: couple of good years here. How do you think about
Speaker 1: the energy space, Well, there's two major developments that UM
Speaker 1: have benefited the sector. The first is they started to
Speaker 1: manage their capital structures appropriately so and also their investment
Speaker 1: so instead of just trying to grow, they tried to
Speaker 1: generate earnings, which I learned as an undergrad is really critical.
Speaker 1: Actual book earnings do matter. And if somebody says they do,
Speaker 1: count Davis by the way you count Davis, so that
Speaker 1: I think is a pretty good law of investing. So
Speaker 1: they's finally started to try to generate actual profits and
Speaker 1: also dividends, which is our core of what we do.
Speaker 1: And then, unfortunately for Europe. They have a failed energy
Speaker 1: policy of not securing enough natural gas even before the
Speaker 1: Ukraine War and then finally after the Ukraine War having
Speaker 1: that cut off. So that's why US energy prices are
Speaker 1: relatively resilient even though we're in the shoulder months and
Speaker 1: global growth is obviously challenged. And that's because natural gas
Speaker 1: is treating at the oil equivalent of a eighty dollars
Speaker 1: a barrel, which draws in all other hydrocarbons into Europe.
Speaker 1: So we have the all time record refining margins for
Speaker 1: distill it because you can ship distill it easily. So
Speaker 1: those two factors are really supporting, of course, the recovery
Speaker 1: from the pandemic, supporting the energy sector and making it
Speaker 1: outperform in these tough markets. But by the way, with
Speaker 1: your experience in the energy industry, UM, which is significant,
Speaker 1: and obviously you're still you know, working with it at infrastructure, UM,
Speaker 1: how likely is it that President Biden is able to
Speaker 1: actually get prices down at the pump by releasing barrels
Speaker 1: from the spr It helps a little bit the margin,
Speaker 1: but you just have to think of the oil market
Speaker 1: as being global, So it's a hundred million barrels per
Speaker 1: day consumed, and so anything that comes out of the
Speaker 1: spr is just going to operate at the margin. So
Speaker 1: it's a gigantic market and it's fungible. So all the
Speaker 1: discussions of limiting Russian oil prices and these other constraints
Speaker 1: really don't work because it's a true commodity market. And
Speaker 1: I was hearing it as too far upstream because we've
Speaker 1: heard um that the problem really is the refining capacity
Speaker 1: and that even if you were to give them fifty
Speaker 1: million barrels of oil a day for free, it's still
Speaker 1: difficult to get that turned into gasoline and diesel absolutely well,
Speaker 1: and particularly diesel because diesel hit eighty dollars of barrel,
Speaker 1: which is almost unfathomable. So it's actually you get more
Speaker 1: margin than the cost of the oil, So that's eating
Speaker 1: at one eight. So that really demonstrates that that's the
Speaker 1: issue is a shortage of distillate to replace the natural
Speaker 1: gas in Europe. So you know when we had the
Speaker 1: syenergy crisis development with the Russian invasion of Ukraine and
Speaker 1: then the reopening of the global economy, and that kind
Speaker 1: of created this energy shortage. If you will, my question
Speaker 1: to all my buddies done in Texas and Oklahoma is like,
Speaker 1: we just start start up the refineries, start pumping. You know,
Speaker 1: we we've got lots of oil, we've got shale. Just
Speaker 1: start finding this stuff and if we have to liquify
Speaker 1: and send it to Europe, we can do that. But
Speaker 1: apparently it's we don't have a lot of refining capacity
Speaker 1: out there, do we know? We definitely don't. It hadn't
Speaker 1: been a great business for years, so there was less
Speaker 1: investment and it doesn't really pay. Most of the new
Speaker 1: refineries are coming in the Middle East. There's really been
Speaker 1: no new refineries. In fact, there is one ship down
Speaker 1: that that blew up in Philadelphia, so you can't really
Speaker 1: just poof of a refinery out there. And it's highly
Speaker 1: imprudent because over time the returns won't be great, so
Speaker 1: you just have to kind of mint money while the
Speaker 1: markets are good and then wait. So it's an Unfortunately,
Speaker 1: I don't like the discipline. I mean, the energy guys
Speaker 1: are now preaching discipline to their equity shareholders and to
Speaker 1: their bondholders and things like that, when in reality I
Speaker 1: need them to build more capacity, but they're not doing it.
Speaker 1: They are, in fact disciplined with their capital you need
Speaker 1: them to as a consumer, yes, as an okay, as
Speaker 1: an investor, j um. Where would you go right now?
Speaker 1: There are a lot of ets out there to play,
Speaker 1: you know, exploration, production, infrastructure, refining. Where do you think
Speaker 1: is the right place to be? Well, we always like
Speaker 1: to have, particularly in these sort of horrific markets, with
Speaker 1: the bond market crashing every day, UM in more conservative,
Speaker 1: Like if you're gonna do energy, do the most conservative,
Speaker 1: so that would be pipelines. Um. Definitely, the yield six
Speaker 1: to eight percent, the super majors have substantial yields, and
Speaker 1: of course we just discussed that the refiners are just
Speaker 1: printing money and trade it ridiculously multiples and have good dividends,
Speaker 1: So that's the better way. We wouldn't And there's a
Speaker 1: few of the e MP companies that have like eight
Speaker 1: nine percent dividends, but they don't need to go after
Speaker 1: the most risky small cop gambling type. You get plenty
Speaker 1: of risk already if you're an energy, so you don't
Speaker 1: need to go small caps. We go ultra large cap
Speaker 1: and dividends. Sorry, well, I'm just um. You mentioned the
Speaker 1: bond market crashing every day, right, which is not great
Speaker 1: if you're a holder. But if you want return, it's
Speaker 1: not bad. Um, where's the tenure right now? Four point
Speaker 1: three four point four on the tenure, but you're getting
Speaker 1: more on the two year and you know everywhere you
Speaker 1: look yields are high. Is that bad for MLP demand?
Speaker 1: I mean, um, do those rates become competitive? Well? Definitely.
Speaker 1: In the last month, all really large cap um value
Speaker 1: dividend stocks got smashed because rates were crashed, and we
Speaker 1: went from two e d to four and two and
Speaker 1: a half once the biggest sell off in you know,
Speaker 1: recent memory at least, and so that really caused most
Speaker 1: of those stocks to sell off. But we don't mind
Speaker 1: that so much because when you're getting paid substantial dividends,
Speaker 1: not like two percent at eight that's still a good spread.
Speaker 1: And those dividends are growing now with the pipeline companies,
Speaker 1: so they're not that raid sensitive. They're just mostly oil sensitive.
Speaker 1: J stick around just when we have some breaking news
Speaker 1: we want to get to. But Jay Haltfield, CEO, Founder
Speaker 1: Portfolio Management Infrastructure Capital Advisors, you're gonna stick with us.
Speaker 1: I got some interesting news coming over the Bloomberg terminal.
Speaker 1: Apple in the news again, the design chief is going
Speaker 1: to leave the company three years after replacing Umster Ivy.
Speaker 1: Evans Hanky, vice President Industrial Design, used it depart. This
Speaker 1: is a big news, Ed Ludlow from Bloomberg News. He's
Speaker 1: usually based on the West Coast and has his tentacles
Speaker 1: and all things Silicon Valley, but he's here in New
Speaker 1: York on a Bloomberg Interactive broker studio. Some pretty big news. Head. Yeah,
Speaker 1: it's big. Is you go back to the history of
Speaker 1: this company in the nineties when Steve Jobs kind of
Speaker 1: came back in and made Apple what it is today.
Speaker 1: This is the first time that they won't have a
Speaker 1: kind of de facto design chief. I think what's also
Speaker 1: interesting is she's only been in the role since two
Speaker 1: thousand nineteen, and you know, to all our global audience
Speaker 1: that have an iPhone, the reason that it's sleek and
Speaker 1: get sleeker and thinner and more beautiful each year. Well,
Speaker 1: this person has a role in evans Hanky leads the
Speaker 1: team of designers that do that. And we talk a
Speaker 1: lot about the macro how Apple performs the high end
Speaker 1: of the market, particularly in markets like China, for the
Speaker 1: middle and upper upper class income bracket. UM but they're
Speaker 1: also working on these new products for its future right
Speaker 1: a r VR, headsets and EV potentially, and she would
Speaker 1: have had a role in that. What we know, according
Speaker 1: to sources is she told everyone she's leaving this week,
Speaker 1: but we'll stay for six months and crucially, the software
Speaker 1: chief is staying. Okay, but I mean turnover an Apple
Speaker 1: doesn't seem like a typical right, They just fired their
Speaker 1: production she you for like well, quoting a line from
Speaker 1: the movie Arthur. Okay, I know you haven't seen, but
Speaker 1: you know we grew up with that movie. Okay, two things.
Speaker 1: First of all, their supply chain chief did depart the
Speaker 1: company for some colorful comments that he made in a
Speaker 1: viral social media It's pretty direct quote. I'm surprised you
Speaker 1: remember the movie. So I'm just not going to say
Speaker 1: on this program. One high area of turnover has been
Speaker 1: the very secretive EV program. Apple's attempt to make a
Speaker 1: self driving electric vehicle has had names from all across
Speaker 1: the industry, from legacy auto too failed names where they
Speaker 1: went startups and work out turnover, turnover. But yes, Paul,
Speaker 1: this is a company where continuity is king. Is this
Speaker 1: design chief specifically focused on, um, you know, the iPhone
Speaker 1: or would a design chief be looking at also the Mac,
Speaker 1: the watch, even the e V Yes. So I guess
Speaker 1: the way that I put it is that she focused
Speaker 1: on the hardware, what it looked like, how it felt
Speaker 1: to the consumer, how how it is, and that not
Speaker 1: just the phone, I pad, everything exactly. You know, That's
Speaker 1: why I flag how crucial it is that Allan Dy,
Speaker 1: who's the head of design for software in ux or
Speaker 1: user interface, is staying because the other big part of
Speaker 1: the tech I've got an iPhone in my hand is iOS, right,
Speaker 1: the operating platform, how how that works across its different things,
Speaker 1: So continuity in that sense. But again she led what
Speaker 1: was a relatively big team, a few dozen very senior
Speaker 1: industrial engineers who we assume we'll stay in place. It's
Speaker 1: just that their chief is leaving after three years and
Speaker 1: that doesn't happen. Just looking at the start greater Apple
Speaker 1: Star kind of unchanged on the day, up about six
Speaker 1: tenths of one percent of the news, so upmarket in
Speaker 1: an upmarket absolutely is any reason is there is this
Speaker 1: signal greater I don't know, uncertainty, turmoil, distraction at the
Speaker 1: at what is a crucial part of the company. You
Speaker 1: know that there's always a question every now and then
Speaker 1: to Tim Cook about succession, just as there is for
Speaker 1: any long tenured executive of a company of that size. Um,
Speaker 1: it's been a rough year for Apple, right, you know,
Speaker 1: they did show nimbleness with the supply chain for a
Speaker 1: big portion of the last eighteen months, but they still
Speaker 1: face headwinds. They faced the the head wind of a
Speaker 1: stronger dollar. They face issues of demand in China, just
Speaker 1: like everyone else. And if your topic, secutives and talent
Speaker 1: are leaving the company for whatever reason, we actually, you know,
Speaker 1: we don't have a good reason why. In this case,
Speaker 1: it's not good. I mean, the the one caveat really
Speaker 1: is that she's only been there for three years and
Speaker 1: we don't know exactly why she left. But she replaced
Speaker 1: a giant in the world of design. She replaced Johnny I,
Speaker 1: who was there for two decades, who was arguably as
Speaker 1: important to Apple success as Steve Jopps. And that's why
Speaker 1: context is king. So first of all, I think I
Speaker 1: said this, but evans Hanki is going to stay for
Speaker 1: six months, so there's a kind of handover period. She
Speaker 1: was appointed to this role in two thousand nineteen, but
Speaker 1: she had worked for Johnny I. For years and years
Speaker 1: and years, you know, a designer in her own right.
Speaker 1: But again it's just a changing of history for Apple.
Speaker 1: The first megastar design chief, Johnny I is twenty years
Speaker 1: of the company. His success is there for three years
Speaker 1: tool intensive purposes. What happens next, you know, that's always
Speaker 1: the question. Alright, good stuff. Ed Ludlow joining us here
Speaker 1: in our Bloomberg interactior broker studio at Ludlow for Bloomberg
Speaker 1: News breaking down some news here. Apple design chief to
Speaker 1: leave three years after replacing the icon Johnny, I've all right,
Speaker 1: this is what we're gonna do, folks. We're gonna get
Speaker 1: a Bloomber business class, reset everything. They're gonna come back
Speaker 1: with a j Hatfield and we're going to get another
Speaker 1: person coming darkening the door as we speak, Dryden Pennce
Speaker 1: ce I, O of Pence Wealth Management. We're around table.
Speaker 1: Even before today we were up to in a third percent. Yes,
Speaker 1: so that was just Monday and Tuesday. We were down
Speaker 1: Wednesday and Thursday, and now when we're up today, that
Speaker 1: just adds to it. I don't know what's going on
Speaker 1: until the options expiration, Yeah, exactly. All right, let's bring
Speaker 1: it back talk some stocks in this segment. J Halfield
Speaker 1: he's still with a CEO at Infrastructure Capital Management, and
Speaker 1: we're joined by Dryden Pence ce I oh for Pence
Speaker 1: Capital Management. Both in our Bloomberg Interactive Broker studio. We
Speaker 1: can't get a Bloomberg employee to come into our studio
Speaker 1: time on a Friday. You know, that's the new world
Speaker 1: we live in. Dried In, what do you make of
Speaker 1: this market? It's been brutal this year. My sixty portfolios
Speaker 1: in the toilet, what do you make of it? I
Speaker 1: think the market right now is is what I call
Speaker 1: the frazzled cat. Everybody's overreacting to whatever piece of information
Speaker 1: comes out, and I think that we're it's a very
Speaker 1: emotional market and it's trading and moving on the multiple.
Speaker 1: So we think it's a tail of two years. This
Speaker 1: year is going to be about the multiple, next year
Speaker 1: will be about fundamentals. But I think that that really
Speaker 1: everybody is overreacting to every piece of news that comes out,
Speaker 1: and folks need to kind of step back and have
Speaker 1: a little better perspective. Well, I mean, look, the problem
Speaker 1: is it's not just what's happening here in the US
Speaker 1: right we have more than ten percent inflation in the UK. UM.
Speaker 1: Germany is looking at a situation where they may have
Speaker 1: to start rationing goods. Um uh. Are we in a
Speaker 1: different situation? Ja, Do you think the US is the
Speaker 1: cleanest dirty shirt? Will we avoid a major recession? Absolutely?
Speaker 1: And it's really related to the conversation we're having before
Speaker 1: about energy, is that Europe's problem is our opportunity. So
Speaker 1: we have manufacturing cost advantage, not just with l G
Speaker 1: and UM refined products, but chemicals steal even there's a
Speaker 1: story about textiles where energy is critical, so we think
Speaker 1: that's a tail wind. And also we the housing sector,
Speaker 1: even though it's going to decline, has limited inventory, and
Speaker 1: that's usually where you get the layoffs in the deepercession,
Speaker 1: it's fed raises rates, layoff all the construction workers, layoff
Speaker 1: auto workers. But because of the pandemic, we don't have that.
Speaker 1: So we're forecasting a mild recession here, but a deepercession
Speaker 1: in Europe. Alright, So driving given that background, I mean,
Speaker 1: when I think about the you know, do you agree, Yeah,
Speaker 1: tend to agree with the idea of a mild recession.
Speaker 1: We're probably on our way, probably on our out of it.
Speaker 1: Before we know what we're in it, So it's more
Speaker 1: of a shallow mild recession because you can lose five
Speaker 1: million jobs and you still have full employment because we've
Speaker 1: got more demand for jobs and we than we actually
Speaker 1: have people. So do I buy kind of the sickles
Speaker 1: that do well if we're you know, mild recession thinking
Speaker 1: about the other side, or do I just stick with
Speaker 1: the big growth stocks that have been so good for
Speaker 1: me since I don't know two thousand eight or something
Speaker 1: like that. Well, I think that that going into the
Speaker 1: end of the year, we're probably gonna have a little
Speaker 1: bit of a rally, and that's good to kind of
Speaker 1: reposition portfolios to stronger more earnings and fundamentals getting into
Speaker 1: next year. We do see that this inflation is going
Speaker 1: to bifurcate certain sectors. Uh. It's kind of like it's
Speaker 1: Walmart and Louis Atom versus Macy's and uh and maybe
Speaker 1: Nords from and Target. The people in the middle are
Speaker 1: actually seeing inflation go faster than wage growth, but the
Speaker 1: people on other end, at the lower end of the
Speaker 1: sectum are seeing wage growth faster than inflation. UH. And
Speaker 1: that's been a positive that's come through this and that
Speaker 1: the upper end. Uh, they're still you know, spending prolifically
Speaker 1: because they've got plenty of money and they're able to
Speaker 1: overcome it. You had an interesting point j on the
Speaker 1: the outlook for inflation, especially as it pertains to the
Speaker 1: repos that we saw. Remember the end of last year
Speaker 1: we started getting insane repo numbers out of the Fed,
Speaker 1: and that just I mean, when a trillion seemed like
Speaker 1: a lot, now we're at what over to trillion, right,
Speaker 1: the two point six trillion, and it's it's sort of
Speaker 1: strangely bullish because what the Fed was doing is to
Speaker 1: keep rates within a band. So in Europe they let
Speaker 1: rates go negative. The Fed had to neutralize all of
Speaker 1: the bond purchases and or they were doing versus most
Speaker 1: of two thousand one and this year they shranked the
Speaker 1: money supply by a trillion through this reverse repo. And
Speaker 1: that's why the dollars skyrocketed and why we're optimistic inflation
Speaker 1: will drop because the leading indicators of the Fed tends
Speaker 1: ignore show that dropping commodity prices, skyrocketing mortgage rates, all
Speaker 1: these were caused by that reverse refo, which really shrinks
Speaker 1: the money supply. So how I mean how much do
Speaker 1: you think inflation is going to drop in by when?
Speaker 1: Because we're trying to figure out every single move. Obviously,
Speaker 1: seventy five basis points this month. Um, it looks like
Speaker 1: there is a Wall Street journal piece which is kind
Speaker 1: of the new mouthpiece for the Fed. I guess said
Speaker 1: they want to try and figure out a way to
Speaker 1: sell a fifty basis point hike, a smaller hike in
Speaker 1: December to the markets without you know, the stock market
Speaker 1: going crazy again. Um, will they be able to hold
Speaker 1: at the beginning of Well, we think they get hold
Speaker 1: now because you have to be patient for two reasons.
Speaker 1: One is that you do anniversary inflation, so that that's
Speaker 1: a benefit, and to the cp I just isn't really
Speaker 1: properly calculated, so Shelter has a six month Every six
Speaker 1: months they do a survey, so doesn't incorporate real time data.
Speaker 1: So you do have to be patient. So that's really
Speaker 1: the mistake we think the FEDS making is ignoring one
Speaker 1: you know, obvious point that almost economists except, which is
Speaker 1: monetary policy os with long and variable legs. Ye, and
Speaker 1: I think there's a lot of there's a lot of
Speaker 1: folks saying that, yeah, there's a lot of people saying
Speaker 1: to fetch paulse because we don't really know what these
Speaker 1: FED rate increases will in fact have on the economy.
Speaker 1: I think the pauses the key word one that will
Speaker 1: that will give you rise to the market probably, But
Speaker 1: I think also it's also it's humans don't adjust as
Speaker 1: fast as markets do. Markets suggests instantaneously, but human demand
Speaker 1: and consumer demand takes a while, and our behavior suggests
Speaker 1: much more slowly than than the FED would like them too.
Speaker 1: And then certainly the market's discounting. So I think a
Speaker 1: pause and kind of let consumers catch up. It takes
Speaker 1: about six or eight months uh for behaviors to begin
Speaker 1: to really change, because you just have you have commitments
Speaker 1: and what you're doing and stuff. So I think that
Speaker 1: that they've got to think about slowing this down, and
Speaker 1: they could risk breaking it. It took this market a
Speaker 1: long time to adjust to the fact that the FED
Speaker 1: is going to actually continue to raise rates. I mean,
Speaker 1: it seemed like every excuse that this market could uh
Speaker 1: could could get for maybe a pause it's coming, maybe
Speaker 1: even a pivot is coming, they took it. Why are
Speaker 1: they so reluctant to believe that the FED is going
Speaker 1: to do whatever it takes. Humans are naturally optimistic that
Speaker 1: that we it is our it is our normal case
Speaker 1: that we are optimistic people. Otherwise why would anybody get
Speaker 1: an airplane? But I mean the key issue here is
Speaker 1: that that people are looking for the market to go up.
Speaker 1: Markets probably oversold at this point. If it's driven on emotion,
Speaker 1: it's driven on on this you know, over gloomy scenario
Speaker 1: that we have. But the fundamentals are We've got more
Speaker 1: people working than we've ever had in our history. We've
Speaker 1: got more more people are making more money than at
Speaker 1: any other time in our history. And I think that
Speaker 1: that carries and we're still the low relatively low labor
Speaker 1: force participation, right, So I think that you have some
Speaker 1: some tail winds to the economy. That this is why
Speaker 1: I agree with the the speaker here that if we
Speaker 1: have recession smiled uh, and that we kind of power
Speaker 1: our way through it. But I think that we're overly
Speaker 1: negative at this point, uh, you know, because we overreact
Speaker 1: to everything the FED does. Right. We overreacted to the
Speaker 1: fact now that they said, yeah, we really mean it
Speaker 1: and people are believing it. Now, we're overreacting to the downside.
Speaker 1: I just kind of wonder if the idea of a
Speaker 1: FED put is finally dead. Right, I mean, anyone who's
Speaker 1: been in this market for as long as Paul has
Speaker 1: Um just counts on the FED to come in and
Speaker 1: save the day every time, Right, was your first job? Yeah?
Speaker 1: So do you think the FED put is gone? Is it?
Speaker 1: Is it? Is it taken? Is it successfully taken off
Speaker 1: the table? I think it's been nuclear exploded. It's more
Speaker 1: like the FED short It's almost like they're working with
Speaker 1: the hedge funds to drive the market lower because they're
Speaker 1: just they're terrible forecasters. And the other thing that I
Speaker 1: think will be discussed more is the two percent target
Speaker 1: is completely made up. It was made up by New
Speaker 1: Zealand in the seventies to inflation rate target. Yeah, the target,
Speaker 1: so they treated the FED treats it like it was
Speaker 1: chiseled on a tow lit by God and then it descended.
Speaker 1: But it's proven to be horrendous if you think about it,
Speaker 1: really precipitated. You mean targeting that targeting too, it should
Speaker 1: be three or four. Obviously we don't want eight or nine.
Speaker 1: That's terrible. But I think you're going to see more
Speaker 1: discussion of that because there is no empirical evidence that
Speaker 1: says two is better than three. It was better than
Speaker 1: four or three or four. Why do you want it
Speaker 1: to be? Why would we want That's what did Ronald
Speaker 1: Reagan say? It's a scarier than an armed robber, more
Speaker 1: dangerous than a murder or something like that. And well,
Speaker 1: the eighties and nineties were boom times, great times to
Speaker 1: be an investment banker, definitely, and inflation was pretty high.
Speaker 1: It was average about three and a half percent. And
Speaker 1: here's the real point. Nominal wages grew about over six percent.
Speaker 1: And really middle class people care about nominal rate wages
Speaker 1: because then they can decide what to buy. They don't
Speaker 1: want a one percent real growth rate and zero pcent inflation.
Speaker 1: So when some level inflation, I leave is very healthy
Speaker 1: for the economy. And you can just look historically. And
Speaker 1: so the burden is on the Fed to prove this
Speaker 1: two percent number that they completely made up. If I mean,
Speaker 1: if you if you think about it, since nineteen sixty,
Speaker 1: or just about fifty percent of the time, we've had
Speaker 1: a FED funds rate about four percent above four percent
Speaker 1: or higher, we've had an inflation rate above three percent
Speaker 1: or higher. I mean for most of the economic lifespan
Speaker 1: of people that are out out there in this industry,
Speaker 1: you've had numbers like this and everything's been all right.
Speaker 1: It's the fact that the last the people in the
Speaker 1: last ten years have only had a zero percent interest
Speaker 1: rate and they've seen these these low inflation numbers. So
Speaker 1: I think that we kind of have to step back
Speaker 1: and recognize that, you know, the United States economy worked
Speaker 1: pretty darn well for a long period of time with
Speaker 1: a four percent fed funds rate and and a three
Speaker 1: or four percent inflation rate, and so we've we've kind
Speaker 1: of lived through this before and we just kind of
Speaker 1: have to you know, that's going to It's not a
Speaker 1: it's not that's not abnormal the last fifteen years and
Speaker 1: add normal, we're getting back to what a normal relationship
Speaker 1: should be tried. And when you talk to your clients,
Speaker 1: did they want you taking risk now? Do they want
Speaker 1: to say, my bonds are wiped out, my stocks are
Speaker 1: wiped up, now it's time to get in or are
Speaker 1: they shell shocked? I I think everybody is a little
Speaker 1: shell shocked. But most importantly, what people want to know
Speaker 1: what clients when it was? When does it end? You?
Speaker 1: Can you can be really endure and endure a lot
Speaker 1: of pain if you know when it's going to end.
Speaker 1: And so we talk about it's gonna end. When three
Speaker 1: peas happen. You have you probably have a pause, uh,
Speaker 1: you have peak inflation, have a pause from the feder
Speaker 1: You end up with peace in Ukraine, which kind of
Speaker 1: triggered a lot of these things. So we're looking for
Speaker 1: language around at least two of those three peas, and
Speaker 1: then we have an election coming up, and historically after
Speaker 1: you can see about an eight percent rise in the
Speaker 1: market after the mid turns. Regardless of the results. It's
Speaker 1: just that you know, you get some certainty in it.
Speaker 1: And and so we looked at that to the end
Speaker 1: of the year. But I think what what retail clients
Speaker 1: are really wanting to hear from us is when does
Speaker 1: the pain end? How soon? How long must I endure this?
Speaker 1: Because most of them been around long enough. Now you
Speaker 1: get through it. I wanted to ask about your service
Speaker 1: because you're an economist and you're a markets guy. Um
Speaker 1: went to Harvard m I T. But I see that
Speaker 1: you also served in the U. S. Army, got a
Speaker 1: commendation medal with a V for valor and combat earned
Speaker 1: a Bronze Star and Knowlton Award. I don't even know
Speaker 1: what that is, but UM tell us about that because
Speaker 1: I think it's fascinating and obviously we appreciate it. Sure. Well,
Speaker 1: I'm I'm a retired full colonel and I my expertise
Speaker 1: with psychological warfare. So, uh, this sounds nice. Well they
Speaker 1: now call it information operations, but what but what that what?
Speaker 1: It really give it a nicer name, but what it
Speaker 1: really was psychological warfare. And so in what we do
Speaker 1: as an investors, we, as you've heard of my comments,
Speaker 1: we really think about human behavior. Nobody makes a you know,
Speaker 1: human behavior drives consumption. Nobody makes a penny until someone
Speaker 1: decides to buy. So if you can try to get
Speaker 1: forward and what people are thinking, what they what their
Speaker 1: fundamental desires are, you can be predictive about what they're
Speaker 1: gonna buy and who they're gonna buy it from. So
Speaker 1: we kind of meld these two things together. And it's
Speaker 1: been very interesting with clients because you know, now that
Speaker 1: we have a war going on, uh, and different kind
Speaker 1: of perspective of things like that. Those those are things
Speaker 1: that a lot of people want to talk about. How
Speaker 1: do how do these things relate so well. Thank you
Speaker 1: very much for your service. Thank you for paying your taxes. No,
Speaker 1: I'm serious. You know if no one has ever thanked
Speaker 1: you for paying your taxes, I'm doing it right now
Speaker 1: because you need to remember. You buy body armor that
Speaker 1: keeps soldiers safe and you save lives. So when people
Speaker 1: get mad about paying their taxes, just please remember that
Speaker 1: you actually are buying body armor that saves soldiers lives.
Speaker 1: I think better paying for it. I think our country
Speaker 1: is all the better for it. All right, good stuff
Speaker 1: at Dry and Pence, Chief Investment Officer, Pence Capital Management.
Speaker 1: Jay Hatfield, CEO Infrastructure Capital Management. Thank you, gentlemen, for
Speaker 1: doing a quick roundtable here on kind of what's going
Speaker 1: on in the markets. There again, we have some green
Speaker 1: on the screen right now. Okay, let's talk about Twitter.
Speaker 1: Let's talk about Snap. I mean, Snap just got crushed
Speaker 1: today down you know, um is that? What's it mean
Speaker 1: for all these social media? The PM yesterday during the
Speaker 1: market say I'm gonna buy Snap because I can't go
Speaker 1: any lower. All right, let's stack up with Man Deep
Speaker 1: seeing he's our senior technology and also for Bloomberg Intelligence. Mandy,
Speaker 1: thanks much for joining US year, appreciate you phoning it in,
Speaker 1: which we notated, uh, snap, what's the story there? We also,
Speaker 1: as Matt was saying, you know, everyone taught evaluation has droft,
Speaker 1: you know down Guess what you know? They came out
Speaker 1: with another bad print and I would say it was
Speaker 1: a mixed report. The user based continues to hold steady.
Speaker 1: But you know they didn't give any guidance. They said
Speaker 1: the engage you when in the US decline five percent,
Speaker 1: and they didn't come out clean in terms of why
Speaker 1: that's happening, whether it's because of competition from TikTok or
Speaker 1: just you know, people traveling more. I will go to
Speaker 1: the TikTok issue. Man frame that now for me, I'm
Speaker 1: not a TikTok or Matt very well might be. But no,
Speaker 1: man is big and what is it? How? Who does
Speaker 1: it really take compete with? Who does it? Is it
Speaker 1: gigantic or do Paul and I just think it's gigantic
Speaker 1: because we are too old to understand. Well, it's really
Speaker 1: big now in terms of the time spent, not as
Speaker 1: much in terms of the advertising revenue, although it is
Speaker 1: the fastest growing advertising company. But right now it's taking
Speaker 1: a line share in terms of the time spend. When
Speaker 1: it comes to the ten to twenty five year olds,
Speaker 1: I think they are the predominant user base, although I
Speaker 1: think all using it. Is it like every twenty year
Speaker 1: old kid has TikTok At this point you can assume, Yeah,
Speaker 1: they have a daily active user base of over a
Speaker 1: hundred million in the US. So yes, I would say
Speaker 1: at this point everybody in that demographic is using TikTok
Speaker 1: and they're using Do we have a sense of kind
Speaker 1: of what they're advertising revenue is? I mean, is it
Speaker 1: really a competitor for those ad dollars out there? Absolutely?
Speaker 1: I mean, based on our work, it's over ten billion
Speaker 1: dollars and growing at a very healthy sixty sevent clip.
Speaker 1: So yes, it surpassed Snap interest, Twitter, everyone already. It's
Speaker 1: giving Instagram a tough time in terms of, you know,
Speaker 1: just the time spent. And as I said, uh, they
Speaker 1: have a very new approach in terms of how they
Speaker 1: you know, show content to the users. It's more AI
Speaker 1: driven and it's more videos, and that's what Mark Zuckerbert said.
Speaker 1: They're gonna make this big pivot to videos and reels
Speaker 1: and really changed to more AI driven feed as opposed
Speaker 1: to user driven feed, which has always been the case
Speaker 1: with you know, Facebook and Instagram. How much room is
Speaker 1: there for all this stuff in the market, Mandyve. I
Speaker 1: mean if you've got Twitter, Snap, Pinterest, Um, TikTok, Facebook,
Speaker 1: I mean, how much room is there for one twenty
Speaker 1: year old kid to um? How many apps can you
Speaker 1: can you be on and and addicted to and spending
Speaker 1: a half hour or an hour a day on. No,
Speaker 1: You're absolutely right that in the end, you know, you're
Speaker 1: competing for that two to three hours of time that
Speaker 1: every consumer can spend max on these apps, whether it's
Speaker 1: and you can you know, even bring in Netflix as well.
Speaker 1: You know, like this is all entertainment, and so if
Speaker 1: somebody is spending more time on Netflix or TikTok, then
Speaker 1: it's taking time away from Facebook and Instagram. Which is
Speaker 1: the challenge that all consumer internet companies have as eyeballs
Speaker 1: and how do I make sure that consumers are using
Speaker 1: my platform and eventually I'll monetize it. In the case
Speaker 1: of Twitter, that eventually has been too long. But I
Speaker 1: think for other platforms the hope is like roadblocks is
Speaker 1: another example. You know, they are taking a good amount
Speaker 1: of share when it comes to the nine year old demographic,
Speaker 1: and so everyone is wine for that, uh, consumer time
Speaker 1: spent on their platform, and the hope is, you know,
Speaker 1: you will monetize it eventually. So ment if we are
Speaker 1: either in or heading into a recession, Uh, that's generally
Speaker 1: not good for advertising spending. What are the digital media
Speaker 1: companies saying about how they expect to perform in a recession. Also,
Speaker 1: that's why you saw Snap not giving guidance last night,
Speaker 1: is because they said brand advertising. We don't know if
Speaker 1: advertisers really want to spend on brand advertising. They're still
Speaker 1: spending on direct response and performance advertising, which is your
Speaker 1: search and you know, uh, direct app download type of advertising,
Speaker 1: but they're not spending as much brand. On the other hand,
Speaker 1: the ad agencies like Omnicon and Publicists, their results have
Speaker 1: kind of been stable. So from my standpoint, the fact
Speaker 1: that ad agencies have done well this quarter shows to
Speaker 1: me that Apple's privacy changes have had some sort of
Speaker 1: an impact in terms of social media targeting, and which
Speaker 1: is why the advertisers are a little reluctant to allocate
Speaker 1: those brand ad dollars on social media right now compared
Speaker 1: to what the ad agencies are doing. By the way,
Speaker 1: how big a deal is it that Apple is losing
Speaker 1: an industrial design chief evans Hankey gonna leave? Um, you
Speaker 1: know this was she was the replacement for Johnny I've
Speaker 1: like one of the most iconic I guess uh design
Speaker 1: chiefs of the digital age. So it couldn't have been easy,
Speaker 1: uh difficult shoes to fill, let's say, but how big
Speaker 1: of a deal is it that she's going to leave?
Speaker 1: I mean, attrition is always, you know, a big deal
Speaker 1: for any tech company Snatch that also has had a
Speaker 1: fair amount of attrition. You know, a couple of the
Speaker 1: key executives left left for Netflix, and you know they
Speaker 1: will be building their ad business for Netflix. So anytime
Speaker 1: you see an executive departure, especially you know in the
Speaker 1: UH management ranks, yes, it can be a big deal.
Speaker 1: But in the case of Apple, you know, they still
Speaker 1: can make any changes to the platform, and if they
Speaker 1: want to become a big player in the ad space,
Speaker 1: they could potentially do that. I mean some people are
Speaker 1: calling that. You know, they are the biggest beneficiaries of
Speaker 1: the privacy changes they've made because a lot of those
Speaker 1: AD dollars could flow to Apple and uh so, I
Speaker 1: I think Apple's advantages they have got so many opportunities.
Speaker 1: They could come up with, you know, a mixed reality
Speaker 1: headset next year, and that could open up a lot
Speaker 1: of opportunities. So I don't think that's it's going to
Speaker 1: change anything in terms of how people perceive Apple. I
Speaker 1: think the big guess risk for them is a China aspect,
Speaker 1: and and that I think is the one that which
Speaker 1: is which is investor, which is what that they can't
Speaker 1: get the right chips so that they can't get the
Speaker 1: production they need there. The production I mean eight percent
Speaker 1: of their you know everything here and when it comes
Speaker 1: to phones or air pods or they're assembled in China.
Speaker 1: So so Mande, I mean all the big name text
Speaker 1: docs that you cover on a rock ronic covers, I mean,
Speaker 1: these have been the darlings. I mean I could have
Speaker 1: been an analyst covering these things and made money. I mean,
Speaker 1: so you know, I hate to give you any credit
Speaker 1: for this because they all went up. But has it
Speaker 1: changed now? Are our investors like they're not I don't
Speaker 1: have to own these things this year? Yeah? Exactly, I
Speaker 1: mean it's changed. I would say consumer internet always has
Speaker 1: a small life in terms of you know, who stays
Speaker 1: at the top. And when you think about you know,
Speaker 1: edwarding digital advertising being a duopoli first with Alphabet and Meta,
Speaker 1: then Amazon being that third player. Now, I think it's
Speaker 1: going to get even more fragmented. Every company out there
Speaker 1: is looking to become an ad network, even you know,
Speaker 1: Kroger and Albertson Murder could be uh could open up
Speaker 1: a new platform around ads that retailers could use to
Speaker 1: show digital ads. So I think you're going to see
Speaker 1: more fragmentation on the ad side because you know, the
Speaker 1: likes of allmar target They're already showing display ads on
Speaker 1: their platform, they have a sizeable e commerce business, and
Speaker 1: more and more ad dollars I think are gonna spread
Speaker 1: out as opposed to you know, only three companies controlling
Speaker 1: all the digital ad platforms. And I think Apple has
Speaker 1: really kind of made that level playing field now that
Speaker 1: no one has an unto advantage in terms of the
Speaker 1: data that they're gathering or the targeting they have. But
Speaker 1: Apple doesn't get any ad dollars, do they? Where could they? Now?
Speaker 1: Apple has about a two to three billion dollar digital
Speaker 1: ad business right now. They show you ads when it
Speaker 1: comes to searches on the app store. Hey man, deep
Speaker 1: Matt's all set to join the metaverse. I'm a little
Speaker 1: bit more skeptical as soon as some as soon as
Speaker 1: some twelve year old builds the metaverse on roadblocks. So
Speaker 1: what's the market really feel about this? Man Deep, And
Speaker 1: you talk to institutional investors, this is something that Facebook
Speaker 1: should be doing well. So Facebook is in a very
Speaker 1: tough spot because they're losing engagement and they have this
Speaker 1: hundred billion dollar plus business that's gonna that's moving away
Speaker 1: from them because they're losing engagement. So Meta worse is
Speaker 1: their play to keep consumers on their platform. And I
Speaker 1: don't know if they should be doing their own hardware,
Speaker 1: but really they don't want to depend on an Apple
Speaker 1: or an alphabet controlling the platform. So that is why
Speaker 1: Mark Zuckerbert is so passionate. Whether it will be successful,
Speaker 1: time will tell. I think hardware is a challenge for
Speaker 1: any company that's doing it for the first time. All right,
Speaker 1: Man Deep, great stuff. As always. I love that Man
Speaker 1: Deep seeing Bloomberg Intelligence can talk anything technology, hard work, software,
Speaker 1: the Internet, all that stuff. Uh, Heat knows it. Matt.
Speaker 1: We talk a lot about electric vehicles here and int
Speaker 1: of your obviously you're the gear head uh in the
Speaker 1: studio here. But when you talk electric vehicles, don't we
Speaker 1: have to talk about batteries? I mean, isn't that like
Speaker 1: the key thing that you have to have a call
Speaker 1: on You have to have a good sense of Dr
Speaker 1: kang Son joins us a CEO of Ampreus. Uh. Ampreus
Speaker 1: is in New York stock a change listed company. A
Speaker 1: mp X is the symbol put into your Bloomberg terminal. Uh.
Speaker 1: DR's Son thanks so much for joining us here. I'd
Speaker 1: love to get just you give us a kind of
Speaker 1: a real overview of what Amprius is, what you do,
Speaker 1: how you uh participate in this electric vehicle revolution has
Speaker 1: taken a place, Paul, thanks for having me. I'm previously
Speaker 1: the vedoper and the manufacturer of higher energy dnsity and
Speaker 1: the higher power dnsity. Bet you my own batteries. Yeah,
Speaker 1: imvious pays you high capacity Cilican as an annal that
Speaker 1: it has a ten times capacity then graph and or
Speaker 1: that industry is currently using. So the future mobility is
Speaker 1: heavily depends on battery performance in sift energy, power, trodging time,
Speaker 1: and the audating tenures. Today, I'm batteries that leader to
Speaker 1: performance in all those properties. So are we gonna see
Speaker 1: you know in the future when um, everyone's making and
Speaker 1: buying and driving electric vehicles. M Is one say, two
Speaker 1: d kilowatt hour battery Uh going to be better or
Speaker 1: different than another two kilott our battery? Yes? Yeah, it
Speaker 1: will depends on the battery material components they will have
Speaker 1: offer different performance. Today I's battery have been used the
Speaker 1: evasion industry, were actually power many flying devices today in
Speaker 1: commercial market. So but what what what's gonna make it better? Um?
Speaker 1: Do you try and make batteries that are smaller? Do
Speaker 1: you want to make batteries that are lighter? Do you
Speaker 1: want to make batteries that charge faster? Do you want
Speaker 1: to make batteries that last longer? What's what are the
Speaker 1: main advantages that you're after? Yeah, we have this called
Speaker 1: city and non water animal batteries. As I mentioned earlier,
Speaker 1: city has a ten times higher energy density than the
Speaker 1: GRAPHI feature industry is currently using. So our battery offer
Speaker 1: much higher energy density. We offer er uh anergy density
Speaker 1: almost twice higher than the current commercial available commercial batteries. Yeah.
Speaker 1: So uh we double the travel time and the mission
Speaker 1: time UH today, So who are your customers? Who are
Speaker 1: your biggest customers today and and kind of where do
Speaker 1: you think the opportunities are going forward? Yeah, we are
Speaker 1: focused on aviation. Will customer including air buss addan flur uh.
Speaker 1: Those are the company MAGA the flying devices. In the future,
Speaker 1: once our logy scale capacity available, we'd like to explore
Speaker 1: other Markey applications, including easy. All right, Dr tanks Son,
Speaker 1: thank you so much for joining us. Dr Kank Sung,
Speaker 1: CEO of ampreus again the New York stock Stange traded
Speaker 1: company a mp X is a symbol. Thanks for listening
Speaker 1: to the Bloomberg Markets podcast. You can subscribe and listen
Speaker 1: to interviews of Apple podcasts or whatever podcast platform you prefer.
Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller three.
Speaker 1: On Ball Sweeney, I'm on Twitter at pt Sweeney Before
Speaker 1: the podcast, you can always catch us worldwide at Bloomberg Radio.