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Speaker 1: Chris Aalman joining us right now, friend of the program

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Speaker 1: and chief investment officer over at Calsters, and I do

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Speaker 1: want to start just in the moment right now, Chris,

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Speaker 1: because we came into this day and we saw the

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Speaker 1: market open higher. Since we started our program about an

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Speaker 1: hour ago, the market has dipped into the red and

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Speaker 1: there's been a lot of questions about the sustainability of

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Speaker 1: this rally and more importantly, what investor sentiment is really

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Speaker 1: signaling right now?

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Speaker 2: You know, Romain, So it's good to talk to you.

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Speaker 2: A tough day for Baltimore, and so our heart goes

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Speaker 2: out to them. I've got a bridge right next to

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Speaker 2: me that's building nineteen eleven, so our infrastructures old in America.

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Speaker 2: But listen, I think that investors are running out of gas.

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Speaker 2: The market is certainly priced near perfection PE adjusted around

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Speaker 2: twenty one according to my trade desk, so it's not

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Speaker 2: out of the question. But I think that we've seen

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Speaker 2: lots of gains already this year, and it's not unusual,

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Speaker 2: even in a bull market year to have some pullback.

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Speaker 2: So I don't know when, but the secuity market isn't

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Speaker 2: going to go right to the moon. So yeah, I

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Speaker 2: think that we should have some slow periods. Seems like

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Speaker 2: we're in one this week as we wait for inflation.

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Speaker 1: Hey, Chris, we were talking earlier to do Akiser over

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Speaker 1: at City about.

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Speaker 2: Do you do stocks or do you do bonds?

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Speaker 1: Like, yeah, if you want the straight up income play,

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Speaker 1: maybe you want to buy the long end, but in

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Speaker 1: terms of price appreciation, that's really a stock play.

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Speaker 2: What say you, Alex, I'm going to play off your

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Speaker 2: earlier come at a family joke of ours. Is it

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Speaker 2: twizzlers or licorice? Answers, Yes, it is stocks and it's bonds.

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Speaker 2: We're going to do bold and we are both, you know.

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Speaker 2: So I'm going to play off Larry Fink's letter that's

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Speaker 2: coming out on retirement in America. America needs to have

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Speaker 2: a balanced portfolio, and that, you know, when the equity

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Speaker 2: market runs like this, that's when people need to take

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Speaker 2: some profits and actually rebalance. Bonds have a yield. You

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Speaker 2: can actually make a decent return out of a bond portfolio.

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Speaker 2: And I think it is time for people to have

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Speaker 2: some bonds, not one hundred percent of one or the other.

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Speaker 2: The answer is and yes, I want both. I want

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Speaker 2: bonds and I want equities.

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Speaker 1: It's interesting you bring up Larry Fink. I mean, there

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Speaker 1: was so much talk about his comments about the retirement crisis,

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Speaker 1: and David Wesson had a chance to sit down with him,

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Speaker 1: and he talked a lot about just fiscal issues and

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Speaker 1: a lot of things that I'm sure you know, Chris

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Speaker 1: As and we the Royal, we have kind of kicked

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Speaker 1: the can down the road for years, if not decades.

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Speaker 1: Is it as imminent and dire as he made it seem?

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Speaker 2: Hey, I haven't kicked it down the road. I don't know, Romayne.

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Speaker 2: If you're implying alex Is kicked it down the road,

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Speaker 2: I'm just saying we always blame all Yeah, I know,

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Speaker 2: we wait the Royal. We I didn't know he became

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Speaker 2: royal on Bloomberg. But that's okay. Let's go with yes

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Speaker 2: and yes, it is a crisis, you know, And I'm

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Speaker 2: going to emphasize something not just about infrastructure, which is

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Speaker 2: on our mind today, but the four A Wooden case.

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Speaker 2: You know, obviously I'm a defined benefit plant. I believe

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Speaker 2: in mixing together all the liabilities, and as Larry points out,

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Speaker 2: longevity is a serious risk. At Calsters, we have over

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Speaker 2: four hundred retirees that are over one hundred years old

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Speaker 2: still getting a pension. So I understand the longevity risk,

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Speaker 2: and I think that for one case, we have a

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Speaker 2: real serious risk of the baby boom running out and

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Speaker 2: outliving their money.

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Speaker 1: And we should point out this is a global phenomenon.

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Speaker 1: And we only have a couple minutes left, Chris, but

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Speaker 1: I want to get your thoughts about that shift in

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Speaker 1: pension investments, the idea that we went from those sort

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Speaker 1: of define payment plans to more of a contribution plans

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Speaker 1: and for some cases no plan at all, you're just

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Speaker 1: on your own. How much of that maybe led to

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Speaker 1: the comments that we heard from Thing today.

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Speaker 2: Well, it's that, and you know, in the backdrop is

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Speaker 2: sole security. It's not exactly in good footing as the

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Speaker 2: baby boom my generation starts hitting into it. So it's both.

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Speaker 2: I think Larry sings that the average American family, as

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Speaker 2: you said, has very little in savings, barely four hundred

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Speaker 2: dollars for an emergency, and people generally don't save enough

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Speaker 2: for retirement. So hard to get the attention of a

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Speaker 2: twenty and thirty year old and get them to save

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Speaker 2: for their future. They think about it when they're fifty,

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Speaker 2: but frankly it's too late. The power of compounding, you

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Speaker 2: know this, Romayne, The power of compounding is amazing and

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Speaker 2: investing in this equity market and compounding is the key.

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Speaker 1: All Right, Chris, got I leave, but they are always

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Speaker 1: great to talk to you. Christopher Allman, Chief investment officer

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Speaker 1: over at Calster's