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Speaker 3: Joins us right now. He's a the UBS.
Speaker 4: He's out of America's tactical asset worst worst job at UPS.
Speaker 3: It's like being in charge with Frank.
Speaker 4: What are you tactically asset allocating into twenty twenty five?
Speaker 4: With everything that's going on, you just pull aside and
Speaker 4: stay in cash.
Speaker 5: I know, we actually upgraded equities about a month ago,
Speaker 5: make them attractive. Still kind of have confidence in the macro.
Speaker 5: Look at that hasn't changed with the election. It's added
Speaker 5: some volatility the outcome certainly to the potential paths the
Speaker 5: by lunch we think this is bull market in equities
Speaker 5: keep going higher.
Speaker 6: So, I mean, what changed for you a two weeks
Speaker 6: ago election day? Did anything change for you guys as
Speaker 6: you think about allocating assets, stocks, bonds, alternatives, US non US?
Speaker 3: Has anything change for you guys?
Speaker 5: Not fundamentally so the way I would kind of describe
Speaker 5: it is that our expected value stayed the same. The
Speaker 5: variants and distribution probably got wider of different outcomes. So
Speaker 5: certain positions that we've kind of recommended, like gold, which
Speaker 5: has actually pulled back that somebody thought as a hedging,
Speaker 5: that's actually become more attractive since that time. The view
Speaker 5: on rates ultimate kind of drifting lower. That has not
Speaker 5: really changed. I think we probably got a little more
Speaker 5: confidence in certain areas of equities, like financials, you know,
Speaker 5: potentially benefiting from deregulation. But I think overall the core
Speaker 5: thesis has not really changed.
Speaker 6: Did you take your expectation for earnings higher thinking that
Speaker 6: taxes are coming down potentially under a Trump administration.
Speaker 5: We have not adjusted our earnings ultimately. Look, we think
Speaker 5: they'll extend their personal tax cuts. I think anything beyond
Speaker 5: extension of existing tax cuts that seems I would make
Speaker 5: that the base case. You know, just there's not a
Speaker 5: lot of fiscal scope for further expansion for the task cuts.
Speaker 5: That's our view at this point.
Speaker 6: You don't think they'll be further very.
Speaker 5: Like something along the lines of reinstituting the sort of
Speaker 5: accelerated depreciation, you know, things that were actually discussed earlier
Speaker 5: this year and part of the budget deal, but not
Speaker 5: further taking down of tax cuts, not as the base case.
Speaker 6: How do you think about the allocation stocks, bonds, alternatives.
Speaker 6: I think Tom and I grew up in a sixty
Speaker 6: forty era. You know that's not a thing anymore, is it.
Speaker 5: Well, it's not a bad starting point, you know. The
Speaker 5: question is like, how do you improve on that? And
Speaker 5: I think that the key thing about the sixty to
Speaker 5: forty what works so well for you know, decades, a
Speaker 5: couple of decades for sure, is that stocks and bonds
Speaker 5: had have negative correlation, and that was because I think
Speaker 5: part inflation was contained. When inflation is contained, it can
Speaker 5: sort of have that negative correlation when you're worried about inflation.
Speaker 5: Think about what happened in twenty twenty two, stocks and
Speaker 5: bonds sell off, inflation will be I think upside risks
Speaker 5: kind of going forward. In that case, you need other
Speaker 5: things to diversify your portfolio. So it's like you know,
Speaker 5: the forty thirty thirty. I'm thinking more along the lines
Speaker 5: of adding alternatives, especially for clients who have, like you know,
Speaker 5: larger portfolios can move into those asset classes.
Speaker 4: Jackson Yale University. There's always a fun This is Bob
Speaker 4: Schuler's legacy. There's always a fundamental of finance over your economics.
Speaker 3: The what's the.
Speaker 4: Track record of rebalancing and asset allocation in recent years?
Speaker 4: Granted we've had three once in a lifetime events, but
Speaker 4: do you still have a theoretical confidence in rebalancing or
Speaker 4: do you tilt more to a longer buy an old strategy.
Speaker 5: Well, rebalancing and on a regular basis, that is becomes
Speaker 5: a little bit more systematic. I think that the deity
Speaker 5: would show that actually adds value. There's a rebalancing alpha.
Speaker 3: So to speak.
Speaker 5: I think where the tricky part comes in is that
Speaker 5: markets move very fast, and now they move very quickly.
Speaker 5: I think about what happened in the summer when the
Speaker 5: S and P was down almost ten percent in about
Speaker 5: two and a half weeks, and then it almost fully
Speaker 5: recovered in two weeks. So the question is like do
Speaker 5: you rebalance then and not rebalunance? And that's kind of
Speaker 5: complicated matters, But conception and rebalancing is adds value over time.
Speaker 6: You guys have a S and P price target of
Speaker 6: sixty six hundred. Tom likes these round numbers. By December
Speaker 6: twenty twenty five. Is that earning's driven, multiple driven a
Speaker 6: little bit of both.
Speaker 5: Mostly earning is driven because I think about where we
Speaker 5: are right now, it's roughly six thousand. If we open
Speaker 5: up and where the futures are ten percent upside, we're
Speaker 5: looking at eight nine percent earnings grow, so and the
Speaker 5: risk I th thing is probably that number might get,
Speaker 5: you know, taken higher. Multiple Basically stay is kind of
Speaker 5: constant to give or take a little bit. So it's
Speaker 5: really mostly an orning story for next year.
Speaker 6: Are there sectors that screen better for you? Guys here
Speaker 6: at this point, like a lot of folks are saying,
Speaker 6: if we're going to get some of this proeconomic agenda,
Speaker 6: maybe some deregulation, maybe in taxes, I want to be
Speaker 6: in cyclicals. Do you kind of fall to that camp?
Speaker 6: Are you saying, I'm just sticking with my technology names.
Speaker 5: Well, we like technology. We still think that's a secular story, right,
Speaker 5: It's kind of agnostic to some extent of the policy.
Speaker 5: He'll come that's what makes it attractive on the cyclical front.
Speaker 5: I think financials that's one of our attractive sectors. And
Speaker 5: you can kind of kind of multiple reasons why, you know,
Speaker 5: deregulation or less sort of owner's regulation that will kind
Speaker 5: of come down the pipeline, likely pick up in corporate
Speaker 5: activity M and A. I pos against certainly the big
Speaker 5: money center banks. You definitely should benefit from that. And
Speaker 5: ultimately we still think the Fed's going to be cutting rates,
Speaker 5: and you know, as rates comes down, that should benefit
Speaker 5: financials as a kind of curve resteep. And so there's
Speaker 5: cynical drivers, there's structural drivers that I think you know
Speaker 5: financials and among the cyclical space.
Speaker 3: That's what we like.
Speaker 4: Right when you did your PhD at Yale, you did
Speaker 4: it on IPOs. Paul and I were live in lunches.
Speaker 4: There'd be three lunches in one day. There was this
Speaker 4: eff vescence on the street which you wrote about authoritatively.
Speaker 3: It yeah, okay, great.
Speaker 4: Do we want to go back to that millu or
Speaker 4: are we lucky that we're here where Paul's going to
Speaker 4: one lunch every ninety days?
Speaker 5: Well, I can't speak to punch of Paul's lunch preferences.
Speaker 5: While you were at doing the three lunches, I was
Speaker 5: in the bowels of Barneaky Library kind of working the
Speaker 5: matter is.
Speaker 3: And we a guy in from Black Rock celebrity earlier.
Speaker 4: We're now at a point where there's four phone calls
Speaker 4: made on an IPO, do you want it or not?
Speaker 3: Yes or no.
Speaker 5: So I don't think we're going to go back to
Speaker 5: what it was in the nineties. I mean, there's just
Speaker 5: regulation ngels that that will sift you all that. But
Speaker 5: also like you know, sorry benz Oxley, like there's there's
Speaker 5: fewer companies that want to go public. We did see
Speaker 5: frothiness back in the second half of twenty twenty, in
Speaker 5: the first half twenty one the spacmania, So there's definitely
Speaker 5: that is possible to kind of come back. But I
Speaker 5: think the closest we've seen for IPOs is you go
Speaker 5: back pre pandemic when Uber went public. Airbnb there was
Speaker 5: appeared in eighteen nineteen. There's a little bit of that,
Speaker 5: but it was at a much more modest scale. We
Speaker 5: weren't seeing stock prices go up seven hundred percent on
Speaker 5: the first day. I mean that those days I think
Speaker 5: are gone. We could see them go up sixty percent,
Speaker 5: seventy percent, but not that level of frothiness before.
Speaker 6: All right, the PhD I from economics from Yale. I
Speaker 6: don't know why you would ever do that. The undergraduate
Speaker 6: tom He goes to the University of Manitoba. So I
Speaker 6: have to google maps Manitoba. That's how ignorant I am
Speaker 6: of Canada, the geography of Canada. If you're not in Winnipeg,
Speaker 6: there's nowhere to be in that province. I mean, right,
Speaker 6: I mean it is. I mean I'm looking at this
Speaker 6: map here. If you're not in Winnipeg, where are you.
Speaker 5: Well, Winnipeg is the big city's table city. The next
Speaker 5: biggest city is going to be more like about fifty thousand.
Speaker 5: But it's a lot of beautiful wilderness if you love
Speaker 5: to fish. Fantastic for fishing. Fantastic for lakes.
Speaker 6: Hudson Bay up on the Upper Head.
Speaker 3: How low of cold?
Speaker 4: The record cold I have is twenty one degrees below
Speaker 4: zero Plymouth, New Hampshire.
Speaker 3: How cold did it ever get in Winnipeg where you
Speaker 3: were up there?
Speaker 5: I mean the coldest days will be below minus thirty celsius.
Speaker 5: So look, I'm around minus twenty five with a wind,
Speaker 5: so the windshill is worse.
Speaker 3: Is anybody going to beat the Winnipeg Jets this year?
Speaker 3: That's all we want to know.
Speaker 5: I'm your fingers crossing, looking really good. But there's you know,
Speaker 5: Florida is a tough team. The Rangers are our tough teams.
Speaker 3: The Rangers, we can always lose it. About the third
Speaker 3: week of March to go to like the Maple leaves.
Speaker 6: Tell us still remote from Winnipeg in January, We'll get
Speaker 6: Lisa Matato.
Speaker 5: I will join you if you get that in Winnipeg.
Speaker 4: Promise if we go to Winnipeg, Dreo will be the
Speaker 4: andrel Thank you so much, really important conversation on asset
Speaker 4: allocation and reb Sen.
Speaker 3: There he is with UBS.
Speaker 2: You're listening to the Bloomberg Surveillance Podcast. Catch us live
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Speaker 4: Wendy Schiller, as the professor from Brown University, joins us.
Speaker 4: I'm listening to Nicki Haley Wendy Schill yesterday and as
Speaker 4: far as I'm concerned, Lisa, don't let the mess Scarra
Speaker 4: run lissus crying, Professor Schiller. The campaign for twenty twenty
Speaker 4: eight did it start last night? With Nicki Haley going
Speaker 4: after irf K Junior and Tulsi Gabbard.
Speaker 7: Well, it's certainly an indication that she's not going anywhere,
Speaker 7: and that she feels like she got some votes when
Speaker 7: she ran against Trump in the primary. She has a constituency,
Speaker 7: and she's trying to position herself as viable. It's a
Speaker 7: long time to work, you know, the next couple of years.
Speaker 7: But you know the first eight months of this administration
Speaker 7: may be successful and accomplishing some of the President elect's
Speaker 7: stated goals, but after that, you know, parties fall apart
Speaker 7: a little bit.
Speaker 5: Majority is of hert.
Speaker 7: To sustain and so she's positioning herself with somebody who
Speaker 7: looks viable very early on.
Speaker 4: So DNI is intelligence and this is the former governor
Speaker 4: of the Carolinas. Quote d and I is not a
Speaker 4: place for a Russian, Iranian, Syrian, Chinese sympathizer when they
Speaker 4: get in front of the Senate or the House, or
Speaker 4: just they're working in the machinery. Wendy Schiller of your Washington,
Speaker 4: how's that going to play with the middle of the
Speaker 4: Road America.
Speaker 7: Well, I mean, I think the calculation that Republican senators
Speaker 7: have to make is which of these nominees and their
Speaker 7: issues and.
Speaker 8: We know we have sexual assault allegations.
Speaker 7: You know, we have child sex trafficking, drug use, we
Speaker 7: have sympathizing with her on in Russia. We have a
Speaker 7: whole list of things which will catch fire, which will
Speaker 7: actually resonate in their voting constituents community. You know, which
Speaker 7: will voters care about right now? Voters sent a signal
Speaker 7: saying fix inflation, you know, fix our cost of living
Speaker 7: and make sure that we have a future in.
Speaker 8: Terms of economic growth. That's what they've said. Will they
Speaker 8: care about this now? Probably not?
Speaker 7: Could they care about it later if these people get confirmed.
Speaker 3: Possibly surveillance correction, it's an important one.
Speaker 4: It's tassa gabbert o gabert I'm mispronounced it because I'm
Speaker 4: an idiot. I wasn't trying to be Snyder or something.
Speaker 4: I don't want people to read anything in them.
Speaker 3: Not excuse me, yelled at me.
Speaker 5: She did.
Speaker 6: Well, she's she's on top of these things. So, Professor
Speaker 6: Schiller here, give us a sense of how you think
Speaker 6: this Republican Senate is going to view some of these
Speaker 6: nominations here, particularly some of the ones that have been
Speaker 6: flagged as maybe troublesome, such as you know, mister Gates
Speaker 6: and uh, miss Gabbard.
Speaker 7: Well, we're obviously seeing some attempts by the you know,
Speaker 7: the administration elect to you know, get Gates through. It's
Speaker 7: typical to have nominees meet with senators. I'm just looking
Speaker 7: you know, for Lisa Rakowski, Susan Collins, you know, particularly
Speaker 7: for Headset and Gates.
Speaker 8: You know, what happens? Do they vote for them?
Speaker 7: And if there are cracks in the coalition and they
Speaker 7: get through, will those cracks grow as each nominee is
Speaker 7: voted on? So which of the most problematic nominees do
Speaker 7: you put first?
Speaker 8: That's going to be.
Speaker 7: John Thune's problem, right and his challenge which one does
Speaker 7: he get through first? If the most problematic one gets
Speaker 7: through first, then you don't have a lot of big problems.
Speaker 7: But you know, I'm going to be looking at those
Speaker 7: two senators and senators who are.
Speaker 8: Thinking of running for reelection in twenty twenty six.
Speaker 7: And because Kamala Hawers lost, there seems to be some
Speaker 7: impression that the female vote isn't going to respond to
Speaker 7: these kinds of things.
Speaker 8: No, women are like everybody else. They prioritize what they
Speaker 8: worry about. In this case, it was budgets. It was schooling.
Speaker 7: It was all sorts of things that hit close to home,
Speaker 7: but behavior still might matter. And so this is the
Speaker 7: calculation that Republican senators have to make, which are thin
Speaker 7: on some of these nominations. Telsey gab You know, Nikki
Speaker 7: Haley was former ambassador of the UN. She does know
Speaker 7: the international community, and I think if she's raising alarms,
Speaker 7: then I think some Republican senators.
Speaker 8: May be listening.
Speaker 4: Professor Schiller is just all this a precursor for every
Speaker 4: single Minutia decision, not Minuchin Minusia decision.
Speaker 3: Like it's Latin. You gotta do that with your Brown University.
Speaker 4: Every single minusia decision, Wendy's going to be made out
Speaker 4: of sixteen hundred Pennsylvania Avenue.
Speaker 8: Oh, it's very difficult to do.
Speaker 7: I keep reciting this with you about Ronald Reagan, right
Speaker 7: he said, I would you know, issue a decision or
Speaker 7: a request. It would take a week to get a
Speaker 7: response in the White House. The federal government is massive,
Speaker 7: you know, to move it quickly is very difficult to do,
Speaker 7: even for the Trump administration. But the question of Congress,
Speaker 7: with that very slim majority in the House, we have
Speaker 7: to see what happens when they start really making cuts
Speaker 7: to programs and people that are in Republican districts. And
Speaker 7: there are a lot of federal employees who live in
Speaker 7: Republican dominated districts and Republican states, and if they have
Speaker 7: a life change or their their job goes, then you know,
Speaker 7: Trump will hear about it.
Speaker 8: How that DAMA plays out, We're going to see it
Speaker 8: probably in the summer.
Speaker 4: Philip Bump killing it in the post yesterday. On the mandate,
Speaker 4: I went nuts yesterday with David Melpass, professor Schiller, Trumps supporter,
Speaker 4: when he said this was.
Speaker 3: A mandate election.
Speaker 4: You're expert at this, back to eighteen eighty three, if
Speaker 4: not back to Adams Jefferson.
Speaker 3: Was that a mandate election? Professor, Well, it's tough.
Speaker 7: I mean, I think by my calculations, he's just under
Speaker 7: fifty percent. That's what I think we have right now
Speaker 7: in terms of the vote tallies. So under fifty percent
Speaker 7: is typically not thought to be a mandate. It would
Speaker 7: have been a stronger argument had the House Republicans picked
Speaker 7: up any number of seats, but it looks like they'll
Speaker 7: have the same exact vote majority that they had in
Speaker 7: last session. That does not suggest, as I thought earlier
Speaker 7: that Trump's cotails would be long and strong.
Speaker 8: I'm wrong about that. They were not that long and strong.
Speaker 8: And that's the big tests usually with a mandate.
Speaker 7: And then you know, getting people back in the office
Speaker 7: is something private sector has been wanting to do. It
Speaker 7: is true that, you know, you could have expected Trump
Speaker 7: to say everybody come back to work. That's something the musk,
Speaker 7: you know musk, they're they're right about that in the
Speaker 7: sense of that was always going to happen. And so
Speaker 7: I think that's something that will be really interesting to
Speaker 7: see and its impact on DC, by.
Speaker 8: The way, as a city.
Speaker 7: The irony is that it could resurrect downtown d C,
Speaker 7: which would be something I think most people would agree
Speaker 7: is a good thing.
Speaker 3: Yeah, it feels like it the thing they proposed.
Speaker 7: Not everything they proposed will be met with opposition, and
Speaker 7: not everything will be successful or a failure.
Speaker 4: Twenty seconds. Professor Schiller is a Talban center at Brown,
Speaker 4: going to five days a week in the office.
Speaker 8: We are excited.
Speaker 7: We're launching a school public policy ju Live for us,
Speaker 7: so we are excited to really be all of us
Speaker 7: on our game.
Speaker 8: That's my answer.
Speaker 7: There.
Speaker 4: There was a sophisticate the General Counsel pass that at
Speaker 4: Brown University. Wendy Shower, thank you so much, particularly those
Speaker 4: comments on our constitution and our civics that is out there.
Speaker 2: This is the Bloomberg Surveillance Podcast. Listen live each weekday
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Speaker 2: Just Say Alexa playing Bloomberg eleven thirty joining us.
Speaker 4: Now the conversation of the day and technology. We had
Speaker 4: Dan Ey's earlier with us from his Sikorski Gene Munster
Speaker 4: joins us now really pleased with that of course, with Deepwater.
Speaker 3: Asset management, Jane, What is the moment we're in?
Speaker 4: Paul Swede and I did important AI seminars for aniog
Speaker 4: Run and Man Deep sing yesterday with Adobe with Salesforce,
Speaker 4: there's Nvidia earnings in the rest. You've been doing this forever.
Speaker 4: What moment are we in in the next year in
Speaker 4: American technology?
Speaker 9: We're in what is going to be the more I
Speaker 9: think exciting year and innovation over the last fifty years.
Speaker 9: And it's hard to really put a language on it
Speaker 9: to capture what the concept of infinite intelligence or close
Speaker 9: to infinite intelligence at almost no cost means for humanity.
Speaker 9: And so as someone who has been around for the
Speaker 9: Internet and saw the boom and bust of that, I
Speaker 9: think this is going to be more significant. And I
Speaker 9: think that next year, if you think about the markets,
Speaker 9: I've been talking about this three to five year bull market,
Speaker 9: and so I started talking about that about a year ago,
Speaker 9: So we're going to say we got a two to.
Speaker 10: Four more years.
Speaker 9: It's going to end in a spectacular bursting of the bubble.
Speaker 9: But I think next year, from just a broader market perspective,
Speaker 9: I think we're going to see another incredible year. And
Speaker 9: I think that it's driven by substance around AI going
Speaker 9: from a build out to starting to move to more
Speaker 9: application since we saw a little bit of that with
Speaker 9: Snowflake today. Of course we've seen most of the excitement
Speaker 9: around the hardware, including Nvidia, but I think we're going
Speaker 9: to start to shift to slowly see more performance in
Speaker 9: software specifically. But just I'm just really excited to be
Speaker 9: alive at this time in life.
Speaker 10: It's just a really special moment.
Speaker 6: Hey, Gene, When I talk to people about AI, I
Speaker 6: often quote you because I remember talking to you maybe
Speaker 6: eighteen months ago on this program, and you put into
Speaker 6: content into a kind of a framework of a companium
Speaker 6: of kind of where you view AI relative to, say,
Speaker 6: the Internet to electricity. Can you just review that for us,
Speaker 6: because it's so powerful to give people a sense of
Speaker 6: how you view the potential impact of AI.
Speaker 9: So it's a zero to one hundred scale, and one
Speaker 9: hundred is the most impactful, most transformative. But at twenty five,
Speaker 9: I would put mobile at about thirty five forty. I
Speaker 9: would have the PC the Internet at fifty. And obviously
Speaker 9: these all build on themselves, but if you look at
Speaker 9: them as a standalone, So the Internet is fifty, I
Speaker 9: think AI is probably ninety and electricity would be one hundred.
Speaker 9: And I think AI would be greater than electricity if
Speaker 9: not for the fact that you need electricity to run
Speaker 9: these machines. Of course, But this is a big deal, Paul,
Speaker 9: And you know there's that's a lot of hype.
Speaker 10: There's a lot of hype in that.
Speaker 9: I think the substance will exceed that hype.
Speaker 6: Yeah, but you're gene when someone like you makes that analysis.
Speaker 6: A lot of people like myself, we pay attention here
Speaker 6: as we try to get our minds around AI. What's
Speaker 6: the next step here? At it feels like we're we're
Speaker 6: so early innings on this, but it feels like we're
Speaker 6: now at the discussion point where.
Speaker 3: The next step is one of your kids needs in Mac.
Speaker 6: It's a new left, new laptop with the AX just
Speaker 6: so you know, that's the next steps this weekend exactly, Geene,
Speaker 6: are we at the point now where we really have
Speaker 6: to make the use case for AI applications? Maybe the
Speaker 6: return on all this investment that we've seen.
Speaker 9: I don't think we're at that point. I think we're
Speaker 9: going to start to see some of that next year.
Speaker 9: And that has been the hesitancy around this whole AI
Speaker 9: trade is that the I think the skeptics would say
Speaker 9: that we just really haven't seen those incredible bread taking
Speaker 9: use cases yet, but they will ultimately come. And I
Speaker 9: think that what we saw with the Nvidia earnings last
Speaker 9: night and specifically this demand, I mean, this is incredible.
Speaker 9: I've never seen a story like this. They did twenty
Speaker 9: one billion in revenue in two thousand. Calendar twenty two,
Speaker 9: they'll do call it one hundred and forty billion in
Speaker 9: revenue next year. There's nothing been anything like this, And
Speaker 9: when you see that, what they're doing is they're building
Speaker 9: the infrastructure. Was still largely in this building infrastructure phase, Paul.
Speaker 9: But some of these breathtaking applications that will change basically
Speaker 9: all forms of our life. I think we're going to
Speaker 9: start to see those a little bit later next year.
Speaker 9: Specifically to this concept of agentic AI came up a
Speaker 9: lot on the Nvidia call last night. But this idea
Speaker 9: of these agents going out and actually getting work done
Speaker 9: for us, I think that's going to be the big
Speaker 9: change how we're all going to interact with these eight.
Speaker 4: First single work gene Munster with us here right now,
Speaker 4: folks thrill these with us, Danizer with US earlier as
Speaker 4: we look at technology in America, Munster with deep water
Speaker 4: asset management, Gene Muster. I look at the Apple A
Speaker 4: and R used to be part of the cellside racket.
Speaker 4: Loved to Piper Jeff for years ago in Minnesota. But Gina,
Speaker 4: I'm looking at Okay, I got forty buys, but the
Speaker 4: fact is.
Speaker 3: They got eighteen holds. I got Apple in a trading
Speaker 3: range since June. It's butchers up now near new highs.
Speaker 4: I assume Gene Munster thinks Apple's going to break out,
Speaker 4: How is it going to break out?
Speaker 3: What will be the catalyst at the top of the
Speaker 3: income statement or on downward.
Speaker 9: It's going to be at the top, and it's it's
Speaker 9: going to be either later this fiscal year, kind of
Speaker 9: the June quarter ish of next year, I think is
Speaker 9: a potential breakout or in fiscal twenty six. And I
Speaker 9: think it's inevitable that this happens. And to put some
Speaker 9: numbers around it, what that breakout is is that the
Speaker 9: streets looking for or iPhone growth in fiscal twenty five
Speaker 9: to be around six percent and for fiscal twenty six
Speaker 9: a pretty similar number. I think that that can be
Speaker 9: ten to fifteen percent. And ultimately all this talk about AI,
Speaker 9: the vast majority of people still don't use AI. And
Speaker 9: if you look at the number of chat GPT on
Speaker 9: a daily basis is probably about one hundred and fifty million,
Speaker 9: two hundred million people. If you look at metas products,
Speaker 9: that's about three point two billion Instagram and so this
Speaker 9: is still a fraction of the use. But what is
Speaker 9: special about what Apple is doing is taking these tools
Speaker 9: and just making them accessible to everyone. And I think that, well, today,
Speaker 9: those features really.
Speaker 10: Don't light up your life.
Speaker 9: I think that as they roll more of them out,
Speaker 9: it will become more clear to people that they have
Speaker 9: to upgrade.
Speaker 6: If I were to put together kind of an ETF
Speaker 6: for AI, because I'm trying to get some exposure to AI,
Speaker 6: but maybe I feel like I've missed the Nvidia trade.
Speaker 6: Are you asking for one of your kids emailed in
Speaker 6: for one of your kids need a basket of AI?
Speaker 6: How else are you thinking about kind of getting exposure
Speaker 6: to Again, this is really seminal shift in technology.
Speaker 9: Paul, I'd be remiss not to mention we have an
Speaker 9: ETF the tickers LOUP. It is frontier tech and it
Speaker 9: basically gives exposure to AI themes that are outside of
Speaker 9: the megacap So if you're looking for some smaller companies
Speaker 9: like Verted, for example, that does cooling, it was mentioned
Speaker 9: on the call, these are the sub kind of two
Speaker 9: hundred billion dollars, So I have to mention that LOUP.
Speaker 9: But I would say that more broadly, I still think
Speaker 9: we're in a period where the hardware piece.
Speaker 10: This is a contrarian view.
Speaker 9: I think the hardware trade is going to continue to
Speaker 9: be stronger than expected over the next several quarters, and
Speaker 9: then as I mentioned, kind of exiting end of next year.
Speaker 9: I think, you know what we're seeing with Snowflake. I
Speaker 9: think you're going to see more and more of that
Speaker 9: in software land kind of later next year. But that's
Speaker 9: kind of how I think about it, still in the
Speaker 9: hardware piece and then moving to software later on.
Speaker 4: Okay, lup up to thirty five percent, three five up,
Speaker 4: thirty five percent.
Speaker 3: One year trail. Robinhood's you're number one holding?
Speaker 5: How do you have?
Speaker 3: Robinhood is part of AI.
Speaker 9: So what they're using is as part of how they
Speaker 9: assess risk with customers, they use AI. They also use
Speaker 9: AI as a means to go and generate new customers
Speaker 9: so for doing outreach. So they've been pretty they've been
Speaker 9: proactive at doing that. So it's companies like Robinhood is.
Speaker 9: Another company that we looked at recently to add to
Speaker 9: this was like Crispin Green. It sounds crazy, but they
Speaker 9: have a big robotics initiative going on. So it is
Speaker 9: these companies that are studying to implement AI kind of
Speaker 9: under the hood.
Speaker 6: Hey, Gene Snowflake, I am looking at Snowflake stocks up
Speaker 6: twenty five percent. Can you tell us what Snowflake does
Speaker 6: and why the stock is up so much today?
Speaker 10: So what Snowflake does.
Speaker 9: It's called a data warehouse, which means that you take data.
Speaker 9: It could be anything from structured data inside of a business.
Speaker 9: Structured data would be data that is in like an
Speaker 9: Oracle database, and it warehouses it so AI models can
Speaker 9: train on it. It basically makes data more accessible and
Speaker 9: usable for training. So that is what they're benefiting from
Speaker 9: is just more training and more enterprises starting to use this.
Speaker 9: Their biggest competitor where they've been losing share, the reason
Speaker 9: why the stock has not done well before today. It's
Speaker 9: called data Bricks, and they have a data lake where
Speaker 9: you can just throw in PDF and Excel documents and
Speaker 9: just throw a bunch of data into this data lake
Speaker 9: and then it organizes it for you.
Speaker 10: But that's what's going on with Snowflake.
Speaker 3: Jane.
Speaker 4: First question to Eli Greenfield yesterday at Adobe is all
Speaker 4: this fancy gene monster data ives talk.
Speaker 3: Is it going to take our jobs away from us?
Speaker 10: Well?
Speaker 9: As an asset manager, I think that that's a very
Speaker 9: real potential. I think as an ANALYSTI it's a little different.
Speaker 9: At deep Water, we launched an affiliate company a few
Speaker 9: months ago called Intelligent Alpha, and it basically is machines picking.
Speaker 9: It's just machines picking stocks, just an et F L
Speaker 9: I v R livermore. But I think it is. It's
Speaker 9: something I just mentioned that in context too. It's one
Speaker 9: of two things is going to happen. Either it's going
Speaker 9: to take our jobs. As an asset manager. I would
Speaker 9: say for you and Paul and your team, you need
Speaker 9: not worry. One of the things that AI won't take
Speaker 9: away is community and empathy. And that's things definitionly that
Speaker 9: can't be done. And I think that's what you guys
Speaker 9: bring every day.
Speaker 3: Well, we have community, do we have empathy? Lisa, I
Speaker 3: don't you know.
Speaker 1: That's a stretch.
Speaker 4: You know, it's like pushing the envelope here a little
Speaker 4: to its gene monster hugely valuable.
Speaker 3: We get a huge signs.
Speaker 2: This is the Bloomberg Surveillance Podcast. Listen live each weekday
Speaker 2: starting at seven am Eastern on Applecarplay and Android Auto
Speaker 2: with the Bloomberg Business app. You can also watch us
Speaker 2: live every weekday on YouTube and always on the Bloomberg terminal.
Speaker 3: You better not have Chris.
Speaker 4: Sale on this, Lisa, I'll tell you that your daily
Speaker 4: look at the front pages of Lisa Mateo hour anticipated
Speaker 4: Lisa Mateo.
Speaker 1: Okay, it's the end of the year, right, Accounting departments
Speaker 1: racing to close the books, so they have all these
Speaker 1: expenses to go through, and they got to get them through.
Speaker 1: So now what they're finding out is a lot of
Speaker 1: workers are pushing the limits with those company credit cards.
Speaker 1: They're finding things, they're telling them Wester Journal. People are
Speaker 1: buying things like Christmas gifts, jet skis, cruises, plastic surgery.
Speaker 1: They're even charging their monthly mortgage payment because they're disguising
Speaker 1: the lender as a business vendor. So this is kind
Speaker 1: of coming under screwtin now you end of the year,
Speaker 1: like people are under the guns that they're trying to
Speaker 1: rush these things.
Speaker 6: Would not allow this, I don't think here at Bloomberg
Speaker 6: he would not. All right, interesting, I mean, I know
Speaker 6: people got like some of the spending accounts and they
Speaker 6: gotta flush the money before they lose it and all
Speaker 6: that kind of stuff.
Speaker 4: I had a beverage of my choice ones for the
Speaker 4: evil Laura, she's in charge of all of our auditing,
Speaker 4: and she told me a couple of stories own.
Speaker 3: And Laura told me, you know, she said, time you competing. Yeah, exactly,
Speaker 3: next it's on the hand.
Speaker 4: No, seriously, it's and you look, we're like everybody else.
Speaker 4: We monitor it is, you know, we do, we do,
Speaker 4: we do.
Speaker 1: So yesterday we talked about the Comcast spinoff right of
Speaker 1: the cable channels, and Paul, it's funny because you and
Speaker 1: Alex and I were talking about this. What about these
Speaker 1: MSNBC staffers like they're going to start to be in
Speaker 1: a panic? Well, sources actually telling you The New York Post,
Speaker 1: MSNBC start, Rachel Maddock, Chris Jansen, Kitty Tour. They had
Speaker 1: this tense meeting at thirty Rock led by NBC Universal
Speaker 1: chairman Mark Lazarus, who's going to lead the company, and
Speaker 1: they say staffers, they're fearing layoffs. They just want to know,
Speaker 1: is it going to change the logo, the name, the headquarters.
Speaker 1: Lazarus said that he just wasn't sure, So it wasn't
Speaker 1: like a good sign. But it's just MSNBC. You know,
Speaker 1: since the election, their ratings have been tanking according to
Speaker 1: Nielsen and people you know MSNBCC they use, they cross
Speaker 1: use a lot of reporters.
Speaker 4: There's the financial side which is always interesting, but the
Speaker 4: editorial side will be very very interesting. In the heritage
Speaker 4: going back, pushing thirty years back when it was Microsoft NBC.
Speaker 4: I mean, there's a lot of heritage here.
Speaker 6: Yep, absolutely, I mean, and again you just think kind
Speaker 6: of where the country is these days? Where is MSNBC
Speaker 6: and it's editorial background. Where does that kind of stand up?
Speaker 6: And again it's a standalone company. You can't hide behind
Speaker 6: the compcast, broadband and cable television number.
Speaker 4: Its fascinating and of course we're all looking at this
Speaker 4: folks on the island of Manhattan.
Speaker 3: I mean, it only focuses on three zip codes. Right,
Speaker 3: there's a zip code of Sunset Boulevard and here in
Speaker 3: New York. Next, Li said, all.
Speaker 1: Right, if you're going shopping New York City's fifth Avenue,
Speaker 1: it is no longer the world's most expensive shopping street. Okay,
Speaker 1: this is according to a new list from Cushman and Wakefield.
Speaker 1: The number one is now Milan's let me see if
Speaker 1: I say this right, via Montenna Napoleon. Enough, it has
Speaker 1: the first but the first time a European city topped
Speaker 1: the list. So it gets the rents globally from about
Speaker 1: one hundred and thirty eight luxury shopping districts, so this
Speaker 1: one topped it. The reason why it is so expensive
Speaker 1: is because it's a shorter street than everyone else on
Speaker 1: the list. So it's about two thousand dollars per square foot.
Speaker 1: That's you know a little bit higher eleven percent than
Speaker 1: they paid the year before. So Fifth Avenue came in second,
Speaker 1: and London's New Bond.
Speaker 6: Street that ubon. Okay, that's right. Well Milan, I mean
Speaker 6: one of my favorite hotels in the world, Hotel Pinchy
Speaker 6: Pey Savoy.
Speaker 4: Oh yeah, can I tell you where growing zeros on
Speaker 4: the three three via Monte Napoleon and that would be
Speaker 4: Fendi Milano monten Napoleon.
Speaker 3: And yes, it's two thousand dollars per square foot. Every
Speaker 3: time you walk a square.
Speaker 6: Foot it goes k ching, nice, you love me.
Speaker 5: Next, and finally here's our kicker.
Speaker 1: So this piece of artwork a duct tape Banantic. So
Speaker 1: he's six point million dollars at Southerb's in New York.
Speaker 1: Six minutes of fear spitting, and yes we did have it.
Speaker 1: It's called the Comedian, okay. It's a sculpture artist Marizio Catilan.
Speaker 1: The buyers is China born crypto entrepreneur. He's going to
Speaker 1: consider lending it out to people, he said. Even if
Speaker 1: Elon mus wants to take it to the moon, he's
Speaker 1: more than welcome.
Speaker 4: In twenty nineteen, if it was one and a half
Speaker 4: million and they popped the sucker at six million, I mean,
Speaker 4: Tang is our.
Speaker 3: You know, I'm drinking Tang zero this morning.
Speaker 4: But you know, if you were to duct tape and
Speaker 4: orange onto a wall, I mean, that's gotta be worth
Speaker 4: eight hundred dollars and you have done.
Speaker 1: It of our YouTube viewers who can actually.
Speaker 4: Mister full disclosure, folks, mister Bloomberg, with his wonderful philanthropy,
Speaker 4: is expanding out on Madison Avenue to the Gagosian Gallery building,
Speaker 4: which is I gets right across from the Carlisle. It's
Speaker 4: a spectacular building and Mike and the architects are doing
Speaker 4: it justice. And I think it's some of those galleries
Speaker 4: in Gagosian's building.
Speaker 3: I mean, I'm sorry the orange tape to the wall.
Speaker 6: You know, folks on YouTube, we have an orange tape
Speaker 6: to the wall in homage to the banana. What do
Speaker 6: we get for the orange? Do you think it's.
Speaker 3: Called still tank at the end of it. It's a
Speaker 3: still life.
Speaker 1: I just want to know if it's the same banana
Speaker 1: from twenty nineteen.
Speaker 3: Exactly.
Speaker 5: You don't know.
Speaker 8: It doesn't say.
Speaker 3: It's what we call installation.
Speaker 5: If you read art news, Okay, the latest.
Speaker 3: It came from Art Basel, Basil. I don't know my name,
Speaker 3: Damien Goes, Alex Steele. I think Goes. Probably I've never
Speaker 3: gone to Art Basel. No, no, mclone. Yes, he is
Speaker 3: so tasteful when he goes. He wears socks exactly. That's it.
Speaker 5: It's formal.
Speaker 8: Are you done?
Speaker 1: I love your edition with the orange tape to.
Speaker 4: The Okay, I got a live chat here YouTube that
Speaker 4: Wicked is going to flop. I mean, what do you think, Lisa, Oh,
Speaker 4: I don't telegraph butchered it in London.
Speaker 1: Don't Ariana. All all the kids are talking about going.
Speaker 1: They're dressing up, some of them, so yeah, it's an event.
Speaker 3: Like how Lisa Matteo, are you going dressed.
Speaker 8: Like I'm going to Gladiator?
Speaker 6: You're going Gladiator?
Speaker 7: I don't.
Speaker 1: I just love that. Denzel Washington's big.
Speaker 3: Lisa Mateo, thank you so much. Our newspaper segment.
Speaker 2: This is the Bloomberg Surveillance Podcast, available on Apple, Spotify,
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Speaker 2: seven to ten a m. Eastern on Bloomberg dot Com,
Speaker 2: the iHeartRadio app, tune In, and the Bloomberg Business app.
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