Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News. Welcome to Merin Talks
Speaker 1: Your Money, the personal finance edition of Merin Talks Money.
Speaker 2: In these bonus.
Speaker 1: Podcasts, we talk about the best strategies for making the
Speaker 1: most of your money. I'm meren Zumset Web and this
Speaker 1: week we're back with another installment of Bloomberg Welt's Where
Speaker 1: to Invest series. This time we're asking the real question,
Speaker 1: where to invest one million dollars? Last time it was
Speaker 1: a mere one hundred thousand, So this time we are
Speaker 1: going big up with us again Bloomberg Personal Finance and
Speaker 1: Wealth reporter Susanne Willie, who joins us from New York.
Speaker 2: Hesusan, Hey, Maren, how are you. I'm good? Thank you.
Speaker 1: Now listen, You've been all over the place recently. You've
Speaker 1: written this great story about how to invest a million dollars,
Speaker 1: but you've also been at a big conference for the
Speaker 1: financial advisors and wealth managers in Miami Beach.
Speaker 2: You love Miami Beach.
Speaker 1: You know I spent all the entire year when I
Speaker 1: was eighteen on Miami Beach. Wow, I know those are
Speaker 1: the days. Tell you about that another time. That's not
Speaker 1: for this podcast. Different different subject, different subjects. Anyway, they
Speaker 1: were in Miami Beach.
Speaker 2: What did you hear that?
Speaker 3: You know, I heard a lot of I didn't hear
Speaker 3: a lot of raw raw us, I guess unsurprisingly. I
Speaker 3: heard a lot about international and you will not be
Speaker 3: shocked to hear that a lot of people were talking
Speaker 3: about private markets, private capital, private equity, had a vet
Speaker 3: how to do your due diligence of private market investments,
Speaker 3: how to do your vetting of investment managers, and also
Speaker 3: you know a lot of bonds, which was sort of refreshing.
Speaker 3: The one area I would say did get a lot
Speaker 3: of attention was that Michael Saylor of Strategy showed up
Speaker 3: all just in black, looking like some sort of you know,
Speaker 3: rock star.
Speaker 1: That's a danger signal, just before we say anything else
Speaker 1: when people turn up all dressed in black like they
Speaker 1: are a rock star and they kind of not actually
Speaker 1: rock star.
Speaker 2: For me, that's a that's a red flag.
Speaker 3: It is to me too, you know. And then there
Speaker 3: was another sort of famous tech analyst for Webrish Securities
Speaker 3: who was all in like I don't know, neon colors
Speaker 3: and colorful sneakers.
Speaker 1: And yes, what did they say?
Speaker 3: Well, you know, they were preaching you know, the gospel
Speaker 3: of bitcoin in in crypto. There was nothing downbeat about
Speaker 3: it at all. And actually the Michael Saylor panel got
Speaker 3: the biggest, you know, standing on the room audience, a
Speaker 3: lot of young guys in there on the beach in
Speaker 3: their you know, polos and shorts and flip flops, and
Speaker 3: he was just saying that he called bitcoin the most
Speaker 3: successful commodity and like the history of you know, mankind,
Speaker 3: and you know, a lot of superlatives like that, as
Speaker 3: you would expect when I privately talked with people at
Speaker 3: the conference, just in a bunch of little sit downs,
Speaker 3: I would ask them this sort of silly question but
Speaker 3: like bitcoin or gold, and no one said, I know,
Speaker 3: I'm sorry, I'm sorry, Mary give a question. It was
Speaker 3: a flawed question because bitcoin is not a hedge, you know,
Speaker 3: as we know in down times in twenty twenty two.
Speaker 2: Et cetera.
Speaker 3: Center, So it was a flawed question. But everyone was
Speaker 3: gold and everyone was saying, you know, bitcoin maybe is
Speaker 3: a hedge in terms of like a fomo hedge, and
Speaker 3: maybe it's what they used to judge excess liquidity in
Speaker 3: the system, whereas consumer sentiment. But you know, one man,
Speaker 3: Brian Belski at a BML Capital Markets said, you know,
Speaker 3: he wouldn't even call it an asset. So there were
Speaker 3: a lot of true believers mixed in there and then
Speaker 3: a lot of more skeptical people that I spoke with.
Speaker 1: Okay, and you mentioned that one of the people you
Speaker 1: spoke to, Emily Rowland, was a bit not that into things.
Speaker 1: Is all about it you've done, and that maybe should
Speaker 1: just hang out in high quality in the US.
Speaker 2: Instaid she was.
Speaker 3: I mean, she's not raw raw US large caps for sure.
Speaker 3: She's saying they seem price to perfection and that you know,
Speaker 3: when you're looking at like twenty times forward earnings, that's
Speaker 3: not exactly a screaming value. But she was also saying that,
Speaker 3: you know, she didn't feel like Europe was really Europe
Speaker 3: is a trade on sort of banks and industrials, and
Speaker 3: she was saying it's a very cyclical trade, whereas you know,
Speaker 3: the US may be sort of price for perfection, but
Speaker 3: it has higher quality earnings. So if people are worried
Speaker 3: about like a got growth slowdown, she was saying, don't
Speaker 3: you want to be in the place with the highest
Speaker 3: quality earnings. So she was sort of the rare person
Speaker 3: to not be positive on Europe. Gabriella Santos that I
Speaker 3: talked to, who's the chief market strategist at JP Morgan
Speaker 3: Investment Management. She was very pro Europe and pro Japan
Speaker 3: based on, you know, starting valuations based on fundamental changes.
Speaker 3: She had a really fun fact which was that since
Speaker 3: twenty twenty two, the MSCAI Europe and MSCAI Japan had
Speaker 3: outperformed the S and P five hundred if you took
Speaker 3: out Nvidia, which I thought was an interesting little factoid.
Speaker 3: And so she was just she's very positive on the
Speaker 3: fundamentals for Europe and Japan going forward.
Speaker 2: It's interesting.
Speaker 1: I mean, I'm thinking, just thinking, is you're speaking about
Speaker 1: what Emily Rowland said about how you should be in
Speaker 1: the highest quality companies that you can find if you're
Speaker 1: concerned about a slowdown or if you're concerned about any global.
Speaker 2: Difficulties on certainty, et cetera.
Speaker 1: And all I can think of when someone says something
Speaker 1: like that is Microsoft two thousand, when I think.
Speaker 2: It fell over sixty percent in a year.
Speaker 3: Yeah, I don't know what.
Speaker 1: And you would have said at the beginning of two thousand, God,
Speaker 1: things are little ropy, everything's too expensive terrible stuff might happen,
Speaker 1: So I'm going to go as high quality as I
Speaker 1: can go, and you still would have lost fifty sixty.
Speaker 2: Percent of your money in a years.
Speaker 1: When people say that, When people give this high quality argument,
Speaker 1: I slightly think to myself, do you know what I
Speaker 1: would get out of right now?
Speaker 2: Is that high quality stuff?
Speaker 3: Interesting? Because too much money has raised into it already.
Speaker 1: Yeah, that's in the price, but it's more than in
Speaker 1: the price, and that makes it not safe anymore.
Speaker 3: I think that's a great argument. I mean, she did
Speaker 3: say that she was in the US markets more interested
Speaker 3: in mid cap stocks, saying that they're about you know,
Speaker 3: thirty percent a discount to you know, the large cap universe,
Speaker 3: and that of course they have you know, stronger balance sheets,
Speaker 3: less debt load, et cetera, et cetera than small caps,
Speaker 3: So she at least wasn't really pounding the table for
Speaker 3: large caps. She was going a little down the capital spectrum.
Speaker 2: Still interesting, isn't it?
Speaker 1: We better get onto the million dollars because you know,
Speaker 1: I know everyone out there is thinking, well, they have
Speaker 1: bitcoming Microsoft, But what do I do with my spare
Speaker 1: million dollars? Because that's the kind of listeners. We have Fatisan,
Speaker 1: that's the people. What do I do with my spare million?
Speaker 3: I asked myself that all the time, all the time.
Speaker 1: Now, what was the best What was the best answer
Speaker 1: you got this time?
Speaker 2: Okay?
Speaker 3: I thought the best answer is this probably one that
Speaker 3: you will like. Was Andrea Desceenso DiCenso, who is a
Speaker 3: portfolio manager and strategist at Loomis Sales, said that she
Speaker 3: would go with a sixty forty portfolio, but not as
Speaker 3: you would traditionally think of it. She would put forty
Speaker 3: percent in europe European equities if I stay forty, Yeah,
Speaker 3: the forty percent would go there, and then the sixty
Speaker 3: percent would go in a basket of global fixed income.
Speaker 3: And the only reason she wasn't higher in European equities
Speaker 3: was because she sees such an advantage in bonds right
Speaker 3: now sort of globally. So that was interesting to me
Speaker 3: because I don't think I've talked to anyone who has
Speaker 3: put that much into European equities and a sixty forty portfolio.
Speaker 2: Yeah, actually slipper exactly exactly.
Speaker 1: So it's really interesting to see someone out there in
Speaker 1: the US who would like to remove not just home bias,
Speaker 1: but all home and go abroad. Although I'm interested that
Speaker 1: she thinks that fixed income is that safe in what
Speaker 1: looks to me like a inflation rising interest rate environment,
Speaker 1: I'm not sure that I would have gone sixty percent
Speaker 1: fixed income.
Speaker 2: That is feisty too.
Speaker 3: Yeah, she does have it in a wide it's pretty
Speaker 3: well diversified. You know some asset back yea ten percent
Speaker 3: in US and European investing, great corporate bonds, twenty in
Speaker 3: high yields, and the last twenty percent she put an
Speaker 3: emerging market corporates and sovereigns. So she's placing a pretty
Speaker 3: broad broad bed there.
Speaker 1: Interesting And do you know what she is my favorite,
Speaker 1: by the way, you're right, And she's particularly my favorite
Speaker 1: for her alternative idea because you know, you was last.
Speaker 1: If it was a non financial thing or something a
Speaker 1: little alternative, what would you do? And she said, you know,
Speaker 1: I'd spend that money going somewhere amazing every weekend with
Speaker 1: a different friend. I just constantly cycle my friends and places.
Speaker 1: And it went to her sister. And for trip number one,
Speaker 1: it's gonna take more than a weekend. They've got to
Speaker 1: Argentina and Chilean and hike around Patagonia, and that's something
Speaker 1: that my husband and daughter just did and I forget
Speaker 1: that is worth a lot. So this is a woman
Speaker 1: after my own heart.
Speaker 3: Although I didn't on that trip me too, that was
Speaker 3: my favorite as well. I mean one person mentioned buying
Speaker 3: a Picasso drawing, which apparently you might be able to
Speaker 3: get for about a million bucks.
Speaker 2: Oh goody. Yeah, I don't know. I'm a bit nervous
Speaker 2: about the art market actually.
Speaker 1: But.
Speaker 3: Interesting another segment.
Speaker 1: Another it did another segment, but you know, it's another
Speaker 1: it's another thing that with high interest rates a piece
Speaker 1: of art is worth less than it is with low
Speaker 1: interest rates. And you begin there are a few cracks
Speaker 1: developing in the art market that I can see. So
Speaker 1: maybe we'll come back that another time. What else did
Speaker 1: we get? I was interested in Anne Barry who talked
Speaker 1: about public markets being expensive and therefore maybe go into
Speaker 1: into private markets. And she talks about private credit.
Speaker 3: Yes, Anne Barry, who's the founder of thread natal Ventures.
Speaker 3: She was sort of along with another woman in the package.
Speaker 3: She was talking about areas where there have been dislocations
Speaker 3: and it's sort of interesting in this time of excess
Speaker 3: that we may be in in the US that they
Speaker 3: were talking about areas when so much money flowed into
Speaker 3: the commercial real estate markets and venture markets and due
Speaker 3: to low interest rates back in like twenty twenty one,
Speaker 3: twenty one is between twenty two. So she was looking
Speaker 3: back and saying, you know, there are opportunities when there's
Speaker 3: a lot of pressure on PE funds to you know,
Speaker 3: exit these investments that they've had that usually hold them
Speaker 3: for five to seven years. It's getting on sort of
Speaker 3: six to eight. So she was saying there's a lot
Speaker 3: of pressure and getting these these exits happening, and that
Speaker 3: that can lead and that that can lead to some
Speaker 3: very good opportunities for private capital because all of these
Speaker 3: deals require private capital. So you know, as the industry
Speaker 3: exits these deals, you know, there's a ton of dry
Speaker 3: powder sitting out there in global PE funds, so they
Speaker 3: have to go out and spend it, and when they do,
Speaker 3: they'll be using private credit to some degree.
Speaker 1: Yeah, it's interesting, isn't I Mean it feels like we're
Speaker 1: in the whole industry is in a little bit of
Speaker 1: a paralysis. You know, the deal that they want to
Speaker 1: exit from the reason they can't exit from them in
Speaker 1: the main is because the price is wrong, So they
Speaker 1: need to see something of a price reset, and private
Speaker 1: credit don't have a role in that.
Speaker 3: Yes, that's true, and I don't know with the volatility
Speaker 3: that we're seeing now. You know, people thought that this
Speaker 3: window might open.
Speaker 1: Well, this was supposed to be the year of IPOs,
Speaker 1: wasn't it again? Yes, yet another year of IPOs. It
Speaker 1: hasn't worked out. And I remember reading at the beginning
Speaker 1: of the year that this would be the year of
Speaker 1: private equity IPOs and the great exit year, and that
Speaker 1: was all going to work out really well because what
Speaker 1: with valuations being so high in the listed market, that
Speaker 1: translated through into peer companies in the private market and
Speaker 1: may be able to get out of these great prices
Speaker 1: twich the answer today is a works.
Speaker 3: Yes, And I mean maybe there's some opportunities in that
Speaker 3: sort of situation and all the dislocation people are saying,
Speaker 3: you know, in times of distress, there's always opportunity, right,
Speaker 3: So you know.
Speaker 1: Speaking of which, you had more of pape from Burnsteinn
Speaker 1: Private Wealth Management talking about as something very similar in
Speaker 1: terms of interest rates commercial commercial real estate, which obviously
Speaker 1: has had a nightmare time with rising interest rates as well.
Speaker 3: Yes, yes, very much so. And I mean her argument
Speaker 3: was sort of similar that she thinks though that commercial
Speaker 3: real estate prices have reset with a new reality, and so,
Speaker 3: you know, with a lot of debt coming do and
Speaker 3: lenders right now are going to be less likely to
Speaker 3: offer the attractive terms that they did when they originally
Speaker 3: made the loans. There are going to be solid properties
Speaker 3: that have issues with their capital structure, and you know,
Speaker 3: that may make them available at a discount. And she
Speaker 3: was appointed to multifamily housing in particular where multifamily areas
Speaker 3: where multifamily housing starts expected to drop, like some you
Speaker 3: know in the South, that could be an interesting place
Speaker 3: to put capital. And I mean she also made the
Speaker 3: point that of course, the ability to raise rents, you know,
Speaker 3: means that you have something of a hedge against inflation.
Speaker 1: Yeah, yeah, and she was was she was she the
Speaker 1: other one who was also interested in buying art? Was
Speaker 1: that her alternates as well?
Speaker 3: Yes, Marin, she was the one who was interested in
Speaker 3: buying art.
Speaker 1: Because there was one there was one who specifically went
Speaker 1: for a Pocanso, and then there was someone else who
Speaker 1: said they can they collected contemporary art, yes.
Speaker 3: Yes, yeah, right, as Anne Berry collects contemporary art, and
Speaker 3: an artist she said she loves and hasn't bought yet
Speaker 3: is Rebecca Manson, who creates these sort of wall sculptures
Speaker 3: and ceramic wall sculptures. They're very fascinating. They're like butterfly wings,
Speaker 3: and I'm very hard to describe. But yes, she's not buying,
Speaker 3: particularly with appreciation in mind, which is always what they
Speaker 3: say you should do about it. Oh, buy what you love,
Speaker 3: don't buy it thinking it's going to appreciate.
Speaker 1: So susan trip to Patagonia or ceramic wool sculpture with butterfly.
Speaker 3: Wings, I don't know, Okay. I loved Andrea Decenzo's idea
Speaker 3: about traveling every weekend with family and friends to different areas,
Speaker 3: so I have a few I would travel too. I
Speaker 3: would have a sister's weekend by two sisters in Newport's,
Speaker 3: New York, which isn't very exotic, but there's a beautiful
Speaker 3: place up there called Mohawk Mountain House where you can
Speaker 3: go hiking.
Speaker 2: I go there.
Speaker 3: Internationally, I've never been to Amsterdam, dying to go there.
Speaker 3: I'd grab some friends and go there. There's no I mean,
Speaker 3: I want to go to Santa Fe, New Mexico. What
Speaker 3: about you, where would you go?
Speaker 1: Well, pretty much anyway, you know in the UK at
Speaker 1: the moment with so heavily taxed and you know, and
Speaker 1: let's talk about wealth taxes and taxia pension and taxing
Speaker 1: theirs and taxing that. Then everyone I talked to us
Speaker 1: just like, yeah, whatever, I'm gonna spend the lot.
Speaker 2: Die Broke is on the move.
Speaker 1: But I tell you, I do really want to go
Speaker 1: to Chili and Patagonia. Everything my my husband and my
Speaker 1: daughter told me about it. It sounds absolutely amazing. Left me
Speaker 1: behind this time, but I think I can try and
Speaker 1: you know, get another trip out of them.
Speaker 2: That's great. So there we go.
Speaker 1: Everybody, if you have a million dollars, just spend it.
Speaker 1: Just spend it. That extra million dollars that is, just
Speaker 1: spend it. Spend it on mainly travel. Thanks Susan.
Speaker 3: Pick up a little art on while you're traveling.
Speaker 1: Yeah, maybe travel first and art if there's anything left
Speaker 1: over from you a million bird, I like that. Thanks
Speaker 1: for listening to this week's Maren Talk to Your Money.
Speaker 1: If you like our share, rate, review and subscribe wherever
Speaker 1: you listen to podcasts. Also, if you sure to follow
Speaker 1: me and John on exor Twitter at Maren at w
Speaker 1: and John underscore Stappack and also Suzanne who is a
Speaker 1: wealth Watch. This episode is produced by Sumersati, Production support
Speaker 1: and sound design by Moses and Questions and comments on
Speaker 1: this show and all.
Speaker 2: Our shows always welcome.
Speaker 1: Our show email is merin Money at Bloomberg dot net