WEBVTT - A Closer Look At Tesla And The Housing Market 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.560 --> 0:00:15.600 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.640 --> 0:00:18.479 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:22.560 at Bloomberg dot com slash podcast. The conversation of the 0:00:22.560 --> 0:00:26.200 morning certainly for me. Dan Eyves, Mountaging director Equity Research 0:00:26.200 --> 0:00:30.479 at web Securities, UM, Penn State alum and a bad 0:00:30.520 --> 0:00:33.479 loss last week Matt, Penn State lost to Illinois. At 0:00:33.640 --> 0:00:35.680 saw that and I thought of Dan when I saw 0:00:35.680 --> 0:00:38.880 it nine overtimes? I mean, who plays nine overtimes? Anyway? 0:00:39.040 --> 0:00:41.080 All right, Dan, thanks so much for joining us here. 0:00:41.200 --> 0:00:43.400 We got Microsoft after the close. I want to get 0:00:43.440 --> 0:00:45.800 your thoughts as we go into that, But first let's 0:00:45.800 --> 0:00:50.480 start with Tesla. I mean, Elon Musk is worth more 0:00:50.600 --> 0:00:52.600 than you know, pretty much the rest of the stock 0:00:52.640 --> 0:00:56.680 market at this point here, this stock to me is 0:00:56.680 --> 0:01:00.360 showing really no signs of concern about rising competence from 0:01:00.400 --> 0:01:04.320 the existing O E M. How do you view that? Look, 0:01:04.360 --> 0:01:07.679 I think we're seeing the biggest transformation to the auto 0:01:07.720 --> 0:01:11.600 industry since nanteen fifties, and Tesla's leading the way on 0:01:11.760 --> 0:01:13.840 ev s and it's really been the one to punch 0:01:13.880 --> 0:01:16.559 in terms of what we saw on deliveries last week. 0:01:16.680 --> 0:01:19.920 Profitability and it hurts is a tipping point. I think 0:01:19.959 --> 0:01:23.720 it's an inflection point overall on evs. There's a five 0:01:23.840 --> 0:01:27.000 trillion dollar market and I think this is just sort 0:01:27.000 --> 0:01:30.840 of the middle innings of the street. Further appreciating this 0:01:31.000 --> 0:01:36.080 Tesla and ev story, Yeah, I mean, what an amazing story. 0:01:36.319 --> 0:01:41.480 Ordering a hundred thousand Model three Dan As close as 0:01:41.520 --> 0:01:46.360 I can figure, this is basically list price that they're paying. Well, 0:01:46.400 --> 0:01:49.360 that's really what sticks out. You know, normally you'll see 0:01:49.360 --> 0:01:56.360 discount tenss price because right now Tesla, it's Tesla's world. 0:01:56.400 --> 0:02:00.200 Everyone else paying rent and evs because demands out strip 0:02:00.240 --> 0:02:03.800 being supplied by about ten per cent. Now you start 0:02:03.880 --> 0:02:06.920 the trajectory out where this could go along with supply 0:02:07.080 --> 0:02:11.360 coming on with Berlin in Austin million today, this could 0:02:11.360 --> 0:02:13.480 be two million a year, and I think that's what 0:02:13.520 --> 0:02:16.639 you're started seeing the stock even look, the heaters will 0:02:16.680 --> 0:02:19.679 heat continue here, but right now, as you're seeing this, 0:02:19.840 --> 0:02:23.160 it's hard for investors to dismiss this green tide away 0:02:23.240 --> 0:02:26.320 playing out, And Dan, how do you think this EV 0:02:26.480 --> 0:02:29.639 market will shake out in ten years time? Well, when 0:02:29.680 --> 0:02:33.680 assuming everybody who's in anybody will have a full complement, 0:02:33.720 --> 0:02:36.520 a full lineup of electric vehicles, where do you think 0:02:36.560 --> 0:02:38.359 Tesla's position will be? Would they kind of be the 0:02:38.919 --> 0:02:41.520 Porsche of the auto industry? Can I just can I 0:02:41.560 --> 0:02:44.359 just point out, speaking of Porsche, the owner of Porsche 0:02:44.919 --> 0:02:53.160 and Lamborghini, Ducatti, Bentley, Bugatti, um Folkswagen and Audi, they 0:02:53.200 --> 0:02:57.399 have a market cap of a hundred fifty million dollars. 0:02:57.400 --> 0:03:01.120 Tesla's billion dollars. Tesla's worth more than a trillion. How 0:03:01.120 --> 0:03:04.880 does that make any sense? Well, look, it's a great point. 0:03:05.000 --> 0:03:07.399 I I've never viewed, and I know we've talked about 0:03:07.400 --> 0:03:10.600 the last decade Tessa as an automotive company. View them 0:03:10.720 --> 0:03:15.080 is the disruptive technology player. But I do think to 0:03:15.280 --> 0:03:20.079 Paul's question, v W for GM and and others is 0:03:20.120 --> 0:03:24.160 part of this five trillion dollar e V transformation. It's 0:03:24.240 --> 0:03:25.920 it's not a zero or some game. They're all going 0:03:25.960 --> 0:03:28.560 to benefit. I mean, you put on perspective, you have 0:03:28.600 --> 0:03:31.000 three million evs in the road globally, have a hundred 0:03:31.080 --> 0:03:33.919 million cars. I believe that's fifty million the end of 0:03:33.960 --> 0:03:37.040 the decade, and Tessa is going to have a significant 0:03:37.160 --> 0:03:40.680 market share of that. But but others are going to 0:03:40.760 --> 0:03:43.960 benefit as well. And that's why this is something you 0:03:44.000 --> 0:03:46.280 look at the rerating that's going to start to happen 0:03:46.320 --> 0:03:50.080 so or what happened GM forward VW because more and 0:03:50.080 --> 0:03:54.240 more investors are going to value that disruptive e VPS 0:03:54.280 --> 0:04:00.440 like a technology ps, not traditional automotive. All right, let's 0:04:00.440 --> 0:04:04.400 switch gears here to our good friends from Seattle, Washington. 0:04:04.760 --> 0:04:08.400 UM Microsoft all time hyphe poy put up that max 0:04:08.480 --> 0:04:12.560 chart on your Bloomberg terminal GP go just extraordinary. What 0:04:12.680 --> 0:04:16.680 do you expect after the close from Microsoft? In I 0:04:16.760 --> 0:04:20.600 think another world series performance by by Nidel and Microsoft, 0:04:20.640 --> 0:04:24.040 I mean continues out the golden touch on cloud cloud 0:04:24.160 --> 0:04:26.880 Armor is playing out, but Microsoft is gaining more and 0:04:26.880 --> 0:04:30.560 more share. This is just the growth story still underestimated 0:04:30.680 --> 0:04:33.240 by the street. So we have a three seventy five 0:04:33.320 --> 0:04:35.760 price target. I think it's just another sort of beaten 0:04:35.800 --> 0:04:41.080 raised special coming out of Redmond. And you see that 0:04:41.520 --> 0:04:46.800 for the other tech companies as well. For Alphabet, Oh yeah, 0:04:46.839 --> 0:04:50.320 I think this is gonna be just a headline week 0:04:50.480 --> 0:04:53.559 for tech across the board Social Media week link because 0:04:53.640 --> 0:04:56.880 what we're seeing on the Apple privacy, I think Apple, 0:04:56.920 --> 0:04:59.720 you're gonna see robust coming out despite chip short just 0:05:00.080 --> 0:05:02.440 right now, demand now stripped and supply by about ten 0:05:02.480 --> 0:05:07.360 million iPhones. Alphabet as well in digital advertising. I believe 0:05:07.520 --> 0:05:10.960 this is sort of the fuel in the tank now 0:05:11.279 --> 0:05:14.560 to get Nazac to our Yarine target of sixteen thousand. 0:05:15.760 --> 0:05:17.800 You know, it's funny day when I look at Microsoft, 0:05:17.880 --> 0:05:19.920 I look at the stock and you know, I'm I've 0:05:19.920 --> 0:05:21.680 been in this market long enough to really kind of 0:05:21.920 --> 0:05:24.520 follow the Microsoft story from day one. When there's a 0:05:24.600 --> 0:05:27.599 you know, I lost decade or so for this company, 0:05:27.600 --> 0:05:30.840 and I feel like such an Adela it doesn't get 0:05:31.200 --> 0:05:34.240 the do that he has deserved, you know, even like 0:05:34.800 --> 0:05:37.120 maybe not an Elon Musk but a Tim Cook or 0:05:37.160 --> 0:05:40.520 some of the other guys from Silicon Valley. The job 0:05:40.600 --> 0:05:44.680 he's done in repositioning this company, I think it's just 0:05:44.760 --> 0:05:49.479 an extraordinary story. How do you think about it? Nadela 0:05:49.839 --> 0:05:52.080 is in the Hall of Fames. I mean, for any 0:05:52.160 --> 0:05:54.720 company what you see in the last fifteen years play 0:05:54.720 --> 0:05:58.000 out what he's done in Microsoft, transforming them into a 0:05:58.040 --> 0:06:01.000 cloud behemus go back to when he took over stocks 0:06:01.040 --> 0:06:03.960 thirty and forty, Mini thought that was really just gonna 0:06:04.000 --> 0:06:08.520 be another mature company playing out. I believe he is 0:06:08.680 --> 0:06:11.960 up there with the likes of Besos Cooking others in 0:06:12.040 --> 0:06:15.840 terms of what he's done. Nonetheless, when you look at 0:06:15.839 --> 0:06:19.000 the I mean I look at cop charts all the time, UM, 0:06:19.040 --> 0:06:24.039 which is automatically a five year chart on the Bloomberg terminal. 0:06:24.240 --> 0:06:28.680 And although Microsoft has done better than almost all of 0:06:28.720 --> 0:06:31.800 the mega tech peers. In fact, Microsoft for the last 0:06:31.800 --> 0:06:37.520 five years done better than Google, Apple, Netflix, Amazon, UM, 0:06:37.600 --> 0:06:39.880 but it just pales in comparison to Tesla. Like this 0:06:39.960 --> 0:06:46.200 chart is unbelievable to look at. Look it is. I mean, 0:06:46.240 --> 0:06:49.479 we're seeing, you know what what what's really some of 0:06:49.480 --> 0:06:53.640 the most transformational growth they're really ever been witnessed in 0:06:53.640 --> 0:06:56.160 the last thirty years. And I think you put these 0:06:56.200 --> 0:07:02.880 stories on a pedestal Tessa, Amazon, Netflix, of course, Apple 0:07:02.960 --> 0:07:05.440 and others, and I think what you're seeing there is 0:07:05.440 --> 0:07:10.760 that more investors are starting to recognize the transformation that's happening, 0:07:10.800 --> 0:07:14.560 and you're seeing the stock continue to reread as this 0:07:14.640 --> 0:07:18.720 all takes place. All right, It's it's a pretty incredible story, 0:07:18.840 --> 0:07:21.680 to say the least. And Dan has been at the 0:07:21.760 --> 0:07:27.200 forefront of this without performs. Yeah, it's it's been amazing 0:07:27.240 --> 0:07:29.400 and I'm sorry about Penn State. I really was thinking 0:07:29.440 --> 0:07:32.160 of Dan. Now. We have to go to Columbus this weekend. 0:07:32.200 --> 0:07:38.320 Hope boy, oh, the Ohio State University University. Dan ives 0:07:38.360 --> 0:07:40.680 there from web Bush Morgan. Always great to get a 0:07:40.760 --> 0:07:48.760 little bit of time with him. This is Bloomberg, all right, 0:07:48.840 --> 0:07:51.320 Let's bring in David Harden right now. He's the CEO 0:07:51.360 --> 0:07:54.520 and chief investment officer at Summit Global Investments. They have 0:07:54.600 --> 0:07:59.040 one point eight billion dollars in assets under management. And uh, Dave, 0:07:59.080 --> 0:08:02.360 I'll just ask you what I've been asking everybody today. Um, 0:08:02.360 --> 0:08:04.520 we're at an all time high on the S and 0:08:04.560 --> 0:08:08.520 P five, even though we face so many headwinds and 0:08:08.680 --> 0:08:13.480 there are so many question marks out there as well, Um, 0:08:13.520 --> 0:08:18.480 what do you make of the SMP. It's pretty amazing 0:08:19.160 --> 0:08:23.440 and the markets always had to climb a wall of 0:08:23.480 --> 0:08:26.880 worry and so definitely, I continue to think this is 0:08:26.920 --> 0:08:29.960 going to be choppy, but I do think it's higher ahead. 0:08:30.000 --> 0:08:31.720 And hey, thanks for having me on your should today. 0:08:31.720 --> 0:08:35.000 But that's what I'm that's what I see all right, David. 0:08:35.480 --> 0:08:37.640 You know, as Matt was just suggesting here, you know, 0:08:37.679 --> 0:08:39.840 with this market at the all time high, a lot 0:08:39.880 --> 0:08:42.800 of valuation concerns in there. That's a big part of 0:08:42.800 --> 0:08:45.880 that wall of worry. But we've had really good earnings 0:08:45.960 --> 0:08:48.360 this third quarter period. Do you think earnings are strong 0:08:48.480 --> 0:08:52.040 enough to support the valuation here? Well, clearly, and and 0:08:52.080 --> 0:08:54.040 the earnings have been crushing it. And I think that 0:08:54.080 --> 0:08:56.440 the earnings revisions will continue. I think that the earnings 0:08:56.440 --> 0:09:00.360 will continue to do well. Yes, growth is slowing, and 0:09:00.400 --> 0:09:03.600 that absolutely inflation is out there, and I think that's 0:09:03.600 --> 0:09:05.719 flattening the yield curve, and I see the tenure going 0:09:05.760 --> 0:09:09.760 to two percent. But I don't see the bubble bursting 0:09:10.520 --> 0:09:14.200 until the FED becomes negative towards the market. I think 0:09:14.200 --> 0:09:18.360 this thing continues and so choppy trading, but you know, 0:09:18.440 --> 0:09:22.920 for me, it's still equities ahead and and cautiously optimistic here, 0:09:22.960 --> 0:09:26.640 but equities still it's the place to play. What what 0:09:26.760 --> 0:09:28.720 is the FED gonna do? I mean, especially now that 0:09:28.800 --> 0:09:32.080 so many people are talking about the possibility of Chinese 0:09:32.080 --> 0:09:37.000 growth slowing maybe less than five percent next year, it 0:09:37.280 --> 0:09:39.640 seems to me difficult for the FED raise rates in 0:09:39.640 --> 0:09:43.480 that kind of situation. Um, and it is and it's 0:09:43.480 --> 0:09:45.480 going to be difficult, and I think that there's gonna 0:09:45.679 --> 0:09:47.240 you know, it doesn't mean that we're going to be 0:09:47.520 --> 0:09:51.400 straight up forever. The market has cycles and people have 0:09:51.440 --> 0:09:54.920 to understand. I think that risk management needs to become 0:09:54.960 --> 0:09:59.720 more central in their investing mindset, and that's one of 0:09:59.760 --> 0:10:01.839 the things we do at s c I is that, 0:10:01.920 --> 0:10:05.720 you know, we focus on managing risk and providing the 0:10:05.720 --> 0:10:10.000 protection that the clients deserve when they're in those situations 0:10:10.000 --> 0:10:11.760 in the future. Because let's face it, the more risk 0:10:11.760 --> 0:10:14.480 management you put in your portfolio, the more that it 0:10:14.520 --> 0:10:19.240 will perform how you designed it to do. So you know, 0:10:19.320 --> 0:10:21.439 there is gonna be a time a time of reckoning, 0:10:22.040 --> 0:10:24.400 and it's gonna and it's gonna be very important to 0:10:24.480 --> 0:10:28.520 investors that their positioned correctly. Many times we just talked 0:10:28.559 --> 0:10:32.720 about the next trade and not about the investment long term, 0:10:32.760 --> 0:10:36.360 and those are two different conversations. David, you've got to 0:10:36.400 --> 0:10:39.959 sell on Southwest Airlines. Is that a call on the 0:10:40.000 --> 0:10:43.520 sector or a call on the fact that Southwest Council's 0:10:43.559 --> 0:10:48.360 flights every day? It's more well the latter, right, I 0:10:48.400 --> 0:10:50.800 think that if you're in this sector UM and and 0:10:50.920 --> 0:10:54.400 there's still business travels still extremely weak. We know that 0:10:54.520 --> 0:10:58.680 right and we know that UM with the pandemic with Delta, 0:10:58.760 --> 0:11:01.120 even though maybe the numbers look better than they did 0:11:01.200 --> 0:11:03.480 last week, so to speak, are we coming out of this? 0:11:04.200 --> 0:11:06.199 We get scarce all the time, but people are getting 0:11:06.240 --> 0:11:11.160 their third shot now. So I think the sector. I'm 0:11:11.200 --> 0:11:14.199 not negative on the sector. But Southwest has continue to 0:11:14.200 --> 0:11:16.680 have problems. It's had problems in their c suite. We've 0:11:16.679 --> 0:11:19.240 seen that this year. We can CEO changes and different things. 0:11:19.520 --> 0:11:22.280 They've had problems now with their computer systems. And what 0:11:22.440 --> 0:11:25.600 you want to understand what those thousands of cancelations is 0:11:25.600 --> 0:11:28.800 the next time people go to book a flight, do 0:11:28.920 --> 0:11:31.120 they think in their minds, I don't. I don't know, 0:11:31.160 --> 0:11:34.560 maybe Southwest is going to cancel me. Once that happens, 0:11:34.600 --> 0:11:37.400 they booked somewhere else, you lose revenue. So the seventy 0:11:37.120 --> 0:11:41.280 five million one time charge great, but what about the 0:11:41.360 --> 0:11:44.200 next flight? That's what I'm worried about with Southwest. I 0:11:44.280 --> 0:11:47.560 see a lot of downside volatility here or risk, and 0:11:47.600 --> 0:11:50.720 so from my standpoint, short term struggles. If you're going 0:11:50.760 --> 0:11:54.520 to be in this sector, avoid Southwest. You do like 0:11:54.760 --> 0:11:57.520 x On Mobile, and this is a company that I 0:11:57.520 --> 0:11:59.600 think a lot of people with E s G concerns 0:11:59.640 --> 0:12:03.040 would have void what draws you to the big oil? 0:12:04.240 --> 0:12:06.160 You know, it's interesting we've been doing E s G 0:12:06.320 --> 0:12:09.680 before e SU was sexting that and and before it 0:12:09.720 --> 0:12:12.559 was even called that, And so sometimes E s G 0:12:12.720 --> 0:12:16.839 is not always about not uh, it's it's more about 0:12:16.840 --> 0:12:20.600 doing what you do really well and avoiding damage. Right. So, 0:12:21.320 --> 0:12:23.640 if Exon was responsible for the oil spill that was 0:12:23.679 --> 0:12:26.520 off the hunt it'son beach coach coast last two or 0:12:26.520 --> 0:12:29.720 three weeks ago, that'd be really bad. But they're not, 0:12:30.040 --> 0:12:32.240 and they're doing really well and you're getting a really 0:12:32.280 --> 0:12:36.400 well paid yield here. Um, you're getting very manageable risk, 0:12:36.880 --> 0:12:40.240 really good management team. And our call is that oil 0:12:40.440 --> 0:12:43.079 stays above where it's at, or stays where it's at 0:12:43.160 --> 0:12:45.040 right now for a longer period of time. And let's 0:12:45.040 --> 0:12:48.840 face it, at this price of crude, excellent is a 0:12:48.880 --> 0:12:51.559 really good opportunity and it's a good value play too. 0:12:51.640 --> 0:12:54.520 So from my standpoint, energy right now is a really 0:12:54.520 --> 0:12:57.559 good play and I would be increasing my energy exposure 0:12:57.840 --> 0:13:00.680 if I was a client. Dave, you're salt Lake cities 0:13:00.679 --> 0:13:04.480 at right correct, we're out of Salt Lake with offices 0:13:04.480 --> 0:13:08.480 in Boise, San Francisco, and Tampa. Let's getting the important stuff. 0:13:08.760 --> 0:13:12.480 How's the snow going to be in Utah this year? Well, 0:13:12.520 --> 0:13:15.800 after a foot of snow last night, nice continued going 0:13:15.880 --> 0:13:20.079 this morning, and a storm every about three days. Our 0:13:20.400 --> 0:13:24.800 resorts are opening up sooner than they've ever done before, 0:13:25.160 --> 0:13:27.920 and so I think it's gonna be a fantastic ski season. 0:13:28.040 --> 0:13:31.040 But I love the skis um book. I've already booked 0:13:31.080 --> 0:13:33.240 two trips out there, so it you know, better keep 0:13:33.320 --> 0:13:35.280 dumping after missing skiing for a couple of years, it's 0:13:35.280 --> 0:13:38.080 gonna be great to get back. Boy. We always make 0:13:38.120 --> 0:13:40.520 plans to do something different, crazy Montana or this or that. 0:13:40.559 --> 0:13:42.800 Then again, he screw it. It's flying to Salt Lake. 0:13:42.840 --> 0:13:45.800 We got world class resorts, you know, minutes away. It's 0:13:45.800 --> 0:13:49.199 just Park City, much easier. Yeah, I know. Awesome, awesome, 0:13:49.400 --> 0:13:51.839 all right. Dave Harden, CEO and Chief investment officer Summit 0:13:51.840 --> 0:13:56.320 Global Investments and our Utah ski man on the ground. 0:13:56.360 --> 0:14:00.920 We appreciate that. Markets again trading higher again. Good earnings, 0:14:00.920 --> 0:14:03.240 we had some good earnings. We have more big tech 0:14:03.280 --> 0:14:06.920 after the close today, but as Dave said, earnings doing 0:14:07.000 --> 0:14:11.680 their part here for this market. Let's bring in Fiona 0:14:11.760 --> 0:14:16.079 Sencata right now, senior financial markets analyst at City Index, 0:14:16.360 --> 0:14:19.120 and Fiona as a journalist. We have to try and 0:14:19.160 --> 0:14:23.200 be skeptical. It's not hard right now. Uh, supply chain, 0:14:23.440 --> 0:14:26.120 I don't think crisis is a is a too strong 0:14:26.160 --> 0:14:30.320 a word to use. Labor shortages, inflation scares, and yet 0:14:31.280 --> 0:14:34.320 we're trading at basically forty six hundred right now on 0:14:34.360 --> 0:14:37.960 the SMP. That's got to be a game of like 0:14:38.000 --> 0:14:44.240 twenty year to day what's going on, that's right. I mean, 0:14:44.280 --> 0:14:47.600 it does feel that very much, this sort of optionism 0:14:47.720 --> 0:14:50.120 that's coming out of earnings at the moment, which is 0:14:50.120 --> 0:14:53.480 actually just lifting the stocks. There's very much the shadowing 0:14:53.520 --> 0:14:57.720 the concerns that we saw heading into earning seasons that 0:14:57.840 --> 0:15:01.720 the inflation confirms, just to surroundings of the labor market, 0:15:02.120 --> 0:15:06.280 the sort of energy crisis and supply chain bottlenecks, all 0:15:06.280 --> 0:15:09.640 that seems to be just being overshadowed right now by 0:15:09.760 --> 0:15:13.800 some some nice strong earnings that we've seen, and I 0:15:13.840 --> 0:15:18.240 think we're not seeing sort of the reflection yet of 0:15:18.440 --> 0:15:22.320 those sort of concerns thing really shown through in the 0:15:22.360 --> 0:15:28.440 earnings from that's something that's helping sort of investors optimism. UM. 0:15:28.720 --> 0:15:32.840 Just for example, the as far as supply chain bottlenecks 0:15:32.880 --> 0:15:35.200 were concern, I think that's very much to see that 0:15:35.440 --> 0:15:38.400 sort of starting to come through in the following quarter. 0:15:38.520 --> 0:15:41.000 And I think that's just what we're seeing at the moment, 0:15:41.120 --> 0:15:43.640 is the market or at that sort of happy point 0:15:43.920 --> 0:15:45.840 where things although we know there are a lot of 0:15:45.880 --> 0:15:49.240 headwinds coming and there are problems surrounding, the numbers just 0:15:49.240 --> 0:15:51.280 aren't quite showing that yet. And also we've got sort 0:15:51.280 --> 0:15:54.640 of consumer confidence data came through today much better than 0:15:54.720 --> 0:15:58.080 expected as well, and so that really helps lift up 0:15:58.080 --> 0:16:01.840 the mood. Adding to that upb we were expecting to 0:16:01.920 --> 0:16:04.760 meet consumer confidence to come in much lower and to 0:16:04.840 --> 0:16:06.880 fall for a fourth straight months. It's actually had a 0:16:06.880 --> 0:16:10.440 surprise jump. So that does bode well in fact for 0:16:11.040 --> 0:16:14.720 the the the economic pick up picture for the start 0:16:14.800 --> 0:16:18.440 of the fourth quarter. UM. If you know, we have 0:16:18.520 --> 0:16:21.600 some big techno names reporting earnings after the closed Microsoft 0:16:21.680 --> 0:16:24.360 alphabet and which I prefer to as Google on old school, 0:16:25.160 --> 0:16:29.160 how are you thinking about the text base right here? Yes, 0:16:29.240 --> 0:16:31.200 so we've had some good numbers, haven't we I mean, 0:16:31.240 --> 0:16:35.280 I think we've had as far as the Facebook was concerned, 0:16:35.560 --> 0:16:37.840 that was as far as I'm concerned, that came better 0:16:37.880 --> 0:16:40.040 than we were expecting in the sense that we saw 0:16:40.080 --> 0:16:43.520 that beat on the earning pressure. Revenue was a little 0:16:43.520 --> 0:16:46.160 bit on the disappointing side, but that perhaps isn't so 0:16:46.360 --> 0:16:50.240 surprising given what we know about what's happening with Apple 0:16:50.440 --> 0:16:55.000 and the the privacy policy change there, and as far 0:16:55.040 --> 0:16:58.280 as what we're expecting from from Microsoft to Alphabet, I mean, 0:16:58.480 --> 0:17:01.120 if we think about how these have rallied over the 0:17:01.160 --> 0:17:04.520 past six months, I mean Microsoft are up thirty over 0:17:04.600 --> 0:17:08.640 the past six months, Alphabets up year today, So there 0:17:08.680 --> 0:17:11.600 are pretty high expectations for these stocks. But I mean 0:17:11.880 --> 0:17:14.840 with Alphabet, for example, not only Google proved to be 0:17:14.920 --> 0:17:18.240 resilient as far as sort of advertising revenue concern, we 0:17:18.320 --> 0:17:20.680 do see it sort of picking up as well from 0:17:20.720 --> 0:17:25.440 that gain in the pickup in travel sector and travel searches, 0:17:25.760 --> 0:17:29.040 which is going to help it along as well. Microsoft 0:17:29.520 --> 0:17:32.880 very much been involved with that remote working companies sort 0:17:32.880 --> 0:17:37.240 of increasingly spend on cloud and on digital transformations because 0:17:37.280 --> 0:17:41.040 of that remote working. This is all very supportive of 0:17:41.160 --> 0:17:43.280 the tech sector. I think we've still got you know, 0:17:43.320 --> 0:17:46.800 we've seen these stocks trading out record highs and they 0:17:46.840 --> 0:17:49.040 have eased off some of them. I think they could 0:17:49.040 --> 0:17:51.760 potentially push higher if we get some more solid numbers 0:17:53.960 --> 0:17:58.520 in terms of the in terms of next year, what 0:17:58.600 --> 0:18:01.679 are you expecting, because the consumer confidence numbers, although they 0:18:01.720 --> 0:18:04.320 were good just now, have been lacking of late, and 0:18:04.400 --> 0:18:06.400 I've heard more and more people use the word recession. 0:18:08.560 --> 0:18:11.879 I think recession is quite a strong word sense still, 0:18:12.480 --> 0:18:14.840 I think we we will see a sort of very 0:18:14.920 --> 0:18:17.880 much a change as we're going into next year. Obviously, 0:18:17.920 --> 0:18:22.280 let's not forget this year has been very much about recovery, rebounding. 0:18:22.359 --> 0:18:25.160 We've had the support from the fiscal support. We've also 0:18:25.200 --> 0:18:28.760 had military policy support. And those taps are going to 0:18:28.800 --> 0:18:30.439 be turned off, we know, sort of as far as 0:18:30.480 --> 0:18:32.919 the Fed is concerned, will be looking for that for 0:18:33.000 --> 0:18:36.000 the taping in them. Those bond purchases to start happening, 0:18:36.600 --> 0:18:40.400 you know, potentially as soon as November December, and then 0:18:40.400 --> 0:18:44.679 as far as interest rates being heiked, that's something that 0:18:44.840 --> 0:18:49.040 could really start to flow the growth that we're seeing. 0:18:49.080 --> 0:18:51.360 I do think recessions a very strong word. I think 0:18:51.480 --> 0:18:54.639 there are concerns about as far as growth is trying 0:18:54.640 --> 0:18:58.920 to flow, particularly as we see those these supply chain 0:18:59.040 --> 0:19:02.199 bottom x the energy crisis sort of moves through the 0:19:02.280 --> 0:19:05.680 market and the markets come to terms with those and 0:19:05.760 --> 0:19:09.760 moved past them. But I think the as Sara's actually 0:19:09.760 --> 0:19:12.480 greatest concern, and do you think we'll continue to see growth, 0:19:12.560 --> 0:19:15.400 but just as a much slower pace, And obviously any 0:19:15.560 --> 0:19:19.000 rising interest rates that bring sort of inslation back under 0:19:19.080 --> 0:19:22.280 control will just sort of stem that groat a little 0:19:22.320 --> 0:19:25.920 bit more. You mentioned energy just real quickly, I'm seeing 0:19:26.119 --> 0:19:28.399 w t I just about eighty five dollars a barrel. 0:19:28.440 --> 0:19:31.240 Have I missed the energy stock trade or the energy 0:19:31.240 --> 0:19:36.320 commodity trade. No, I think there is more here. I mean, 0:19:36.640 --> 0:19:39.760 I get energy, and as far as oil is concerned, 0:19:39.800 --> 0:19:43.119 it's had a very impressive run I mean we know 0:19:43.280 --> 0:19:47.080 sort of coal prices and gas prices have absolutely surge, 0:19:47.440 --> 0:19:50.119 and w t I has also had a very good 0:19:50.240 --> 0:19:51.879 run up. Was just in the the gas and the 0:19:51.920 --> 0:19:54.080 coal prices starting to edge down after we've had that 0:19:54.200 --> 0:19:58.760 intervention from China, particularly in the coal market. But I 0:19:58.840 --> 0:20:00.920 think as far as oil in this concern, we know 0:20:01.080 --> 0:20:04.240 that demand is still very strong, particularly in the US, 0:20:04.840 --> 0:20:08.840 and then we've also got to very tight supplies from Ope, 0:20:09.000 --> 0:20:12.200 they're not looking to sort of move so far beyond 0:20:12.280 --> 0:20:15.480 those four D extra barrels they agreed back into life, 0:20:15.600 --> 0:20:17.760 So so I think there is further to run that 0:20:18.080 --> 0:20:19.760 all right, Fiana, thank you so much for joining us. 0:20:19.760 --> 0:20:22.760 As always, Fiona and card A, senior financial markets analysts 0:20:23.119 --> 0:20:26.160 for City in next giving her her thoughts on these 0:20:26.240 --> 0:20:30.440 markets again earnings after the close, Big Tech, this is Bloomberg. 0:20:34.080 --> 0:20:38.719 Now we got us new home sales numbers um UH 0:20:39.359 --> 0:20:42.399 sales of new homes in America increase in September to 0:20:42.400 --> 0:20:46.359 the highest level in six months, underscoring what we already 0:20:46.440 --> 0:20:50.760 knew was pretty solid underlying demand. Brad Dillman joins us 0:20:50.840 --> 0:20:56.040 right now, chief economists at Courtland out of Atlanta, And Brad, 0:20:56.800 --> 0:20:58.159 what do you think I mean? We knew it was 0:20:58.200 --> 0:21:01.080 going to be hot, but I'm not sure everybody knew 0:21:01.160 --> 0:21:06.480 that purchases of single family homes would grow fourteen percent 0:21:07.119 --> 0:21:12.800 to an annualized eight hundred thousand. It's definitely higher than expectations. 0:21:13.200 --> 0:21:15.399 The figure I had had in front of me for 0:21:15.480 --> 0:21:18.760 the expectations figure with seven twenty thousand on a seasonally 0:21:18.840 --> 0:21:21.920 does at annualized basis so it's certainly be what most 0:21:22.000 --> 0:21:25.440 models have been predicting. You know, one of the things 0:21:25.640 --> 0:21:27.640 as we think about the housing market bread it's been 0:21:28.080 --> 0:21:33.360 so consistently strong through this entire economic tumult from the pandemic, 0:21:33.920 --> 0:21:35.480 But when we think about the supply of housing in 0:21:35.520 --> 0:21:39.040 the US, it hasn't been necessarily where it's needed. I'm 0:21:39.040 --> 0:21:42.480 thinking the entry level home. We haven't seen new home 0:21:42.520 --> 0:21:48.840 construction really address that market. Uh, Is that changing at all? No, Unfortunately, 0:21:48.840 --> 0:21:50.879 it's not that. If we look at the price movement 0:21:51.040 --> 0:21:53.480 in what's happened on the new home sales side. For example, 0:21:53.520 --> 0:21:57.159 the median price came in it fo UM. That's up 0:21:57.200 --> 0:22:00.680 from about eight thousand pre COVID and US. To put 0:22:00.720 --> 0:22:03.280 it an a broader reference, twenty years ago, the price 0:22:03.320 --> 0:22:04.680 for a new home would have been about a hundred 0:22:04.680 --> 0:22:06.720 and sixty eight thousand, So that's a two and a 0:22:06.760 --> 0:22:10.439 half times increase. So we are definitely seeing those prices 0:22:10.480 --> 0:22:13.080 continue to take up. Now. I would make the argument 0:22:13.119 --> 0:22:15.920 that that's in part due to financial conditions, and I 0:22:16.000 --> 0:22:17.720 think part of the reason that housing has been so 0:22:17.840 --> 0:22:21.119 strong since the onset of the pandemic has been what's 0:22:21.200 --> 0:22:23.120 gone on and with mortgage rates, which is that they've 0:22:23.160 --> 0:22:26.600 come down so much and remain quite low. Um. I've 0:22:26.640 --> 0:22:28.679 talked in the past about the tenure tregury rate being 0:22:28.720 --> 0:22:31.920 negative in real terms once week factor and inflation and 0:22:32.000 --> 0:22:34.680 an aspect of this passing through the mortgage rates with 0:22:34.800 --> 0:22:37.120 they're being really low as well. But when we look 0:22:37.160 --> 0:22:39.800 to new homesale too, you know, we had this huge 0:22:39.880 --> 0:22:41.840 rebound in the wake of the pandemic that it's then 0:22:41.920 --> 0:22:43.280 cooled a bit. And now I'd say when I look 0:22:43.320 --> 0:22:45.639 at this figure, I'd say it's it's really resuming its 0:22:45.640 --> 0:22:48.159 pre COVID trend. So maybe we'll see a continuation of 0:22:48.240 --> 0:22:52.120 that going for what is I mean, it's a very 0:22:52.200 --> 0:22:57.240 regional market, right The United States is gigantic and um, 0:22:57.720 --> 0:23:00.840 you know I realized that even more having lived in 0:23:01.000 --> 0:23:04.800 Europe for for years. Now, where do you see the 0:23:04.960 --> 0:23:07.439