Speaker 1: Bloomberg Audio Studios, podcasts, radio news, single bust idea starting
Speaker 1: the second quarter. What a great day. We had a
Speaker 1: lot of equity talk, stock market for the first time.
Speaker 1: I'm on Dow forty thousand, watcher at Dow thirty nine
Speaker 1: thousand something whatever, But it's there, and it's the equity market,
Speaker 1: not only the Q one lift, but lifting from October
Speaker 1: and far more lifting from a year ago October. It's
Speaker 1: been a heck of a move. Many of you in
Speaker 1: the market and those that have missed the market are
Speaker 1: acutely aware of these valuations. What we're gonna do is
Speaker 1: we're gonna talk about one of the moonshots out there,
Speaker 1: not Bitdog. We'll do that. I promise we'll do bitcog
Speaker 1: Dog on single best idea Bitcoin, I should say it's
Speaker 1: single best idea. But we're gonna look at Coco here
Speaker 1: in a moment with a great kna haek of ed
Speaker 1: and f But first of all, I've been dying to
Speaker 1: do this. There are people that have pedigrees in academics
Speaker 1: that give pause. Jim Karen at Morgan Stanley did physics
Speaker 1: at Boden, which is a really well known school for
Speaker 1: that small liberal arts but with a huge science integrity,
Speaker 1: and then he wandered out to a small school called
Speaker 1: California Institute of Technology Caltech, did the same thing onto
Speaker 1: a sterling academic career at Morgan Stanley and Bonds. I
Speaker 1: have been dying to talk to Jim Caron about the vogue.
Speaker 1: The rage right now of momentum is a factor ROW
Speaker 1: equals MV. I'm not going to go into the physics here.
Speaker 1: It's a Monday. My brain's not working, But needless to say,
Speaker 1: I have real trouble with the physics envy the physics
Speaker 1: mathematics bringing it over to the stock market. Jim Karen said, no,
Speaker 1: there's something too momentum.
Speaker 2: The way that we think about this in the markets.
Speaker 2: I mean, obviously we look at different facts, and momentum
Speaker 2: is one of the factors that's in the markets, and
Speaker 2: there's many ways to calculate this. I mean, obviously it's
Speaker 2: just the it's the consistency and of price change, and
Speaker 2: not just a consistency of price change, but it's inability
Speaker 2: to deviate meaningfully from a direction. So if there's positive
Speaker 2: momentum in the place, there could be a dip, but
Speaker 2: that dip is very short lived and it just continues
Speaker 2: on the path that it was on before. So that's
Speaker 2: the momentum that we're facing. And that's really one of
Speaker 2: the key factors across most of the equity sectors right now,
Speaker 2: particularly in technology, and it's one of the things that
Speaker 2: is a driving factor. It's a risk because if momentum turns,
Speaker 2: then it's going to hurt a lot of things all
Speaker 2: at once. And I think we need to be a
Speaker 2: little bit worried about that. But that's but so far,
Speaker 2: momentum is your friend.
Speaker 1: Jim Karrn of Morgan Stale. A momentum is a vector.
Speaker 1: It's like an arrow in space, and it's the price
Speaker 1: in this case series traveling upon the vector. And with
Speaker 1: the word that I really focus on here is the
Speaker 1: magnitude the oomph of that vector through space. And right
Speaker 1: now the oomph of the equity market is noted. And
Speaker 1: mister Karen has said, I think what he said to
Speaker 1: honor the late Marty's wag, the trend is your friend
Speaker 1: until it's not. I don't think there's a trend to Coco.
Speaker 1: I don't know what to do with this. Long ago
Speaker 1: and far away in my ute, I had an injury
Speaker 1: in hockey, and I was flat on my back for
Speaker 1: a good ten weeks, twelve weeks, crutches and all that,
Speaker 1: but basically I was horizontal, and I put around the
Speaker 1: bed in the family TV room twenty or thirty books
Speaker 1: that my mother dutifully went and got from the library,
Speaker 1: and one of them was on commodities. It was called
Speaker 1: Cohen and the first commodity I ever studied was Coco.
Speaker 1: Coco is two or three countries in West Africa. It
Speaker 1: is a huge oddity, and when the oddity goes up
Speaker 1: or down, it trends. We've now had an explosive moonshot
Speaker 1: a trend in Coco, and for days I've said to
Speaker 1: the team, Eric Will and the team get ConA haik.
Speaker 1: She is outstanding on the softs and brings an old
Speaker 1: world view to it. She is with edy enough and
Speaker 1: the moonshot of cocoa corna hach.
Speaker 3: Oh my god, it really is a moonshot. It's skyrocketing.
Speaker 3: I've never seen anything like this. It's supplied demands, it's
Speaker 3: incredibly volatile, and you're right, it doesn't trend with anything else.
Speaker 3: Cocoa production is so concentrated in a handful of countries
Speaker 3: which are which are very much influenced by their own
Speaker 3: set of microclimatic factors. It's it's very particular. It is
Speaker 3: fairly elastic. It's not a staple like grains or vegetable oils,
Speaker 3: which you know you have to you cannot do without.
Speaker 3: There are some people who say that chocolate is very addictive,
Speaker 3: But at the end of the day, if it was
Speaker 3: up to feeding and having cereal and rites and something
Speaker 3: to sustain you with versus that indulgent, lovely pitt you
Speaker 3: know what you're going to go for.
Speaker 1: The elastic word is microeconomics. I'm gonna call it Marshallian economics.
Speaker 1: For responsiveness, there is elastic and inelastic. Your need for water,
Speaker 1: your need for milk, your need for your cheerios is
Speaker 1: pretty inelastic. You have to have you have to have
Speaker 1: your weedies every morning. But chocolate is supposed to be inelastic,
Speaker 1: where if the price goes up, we say no, or
Speaker 1: we substitute something else. I did, Eric, did you observe
Speaker 1: that this weekend at the house. I did not observe
Speaker 1: an elastic chocolate function. It was very inelastic and all consuming,
Speaker 1: and I couldn't believe what some of these upscale Boutiki
Speaker 1: chocolates are run right now. It's like refinance the house anyways,
Speaker 1: Kona haik there of v dn F on Cocoa. Single
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