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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: Single best idea and we say good morning to you.

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Speaker 2: Claims came in three days of job data ADP pretty good, claims,

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Speaker 2: pretty much on track. It's a fully employed America as

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Speaker 2: a generalization. And the jobs report tomorrow had a lot

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Speaker 2: of good economic conversations today. We'll go beneath the headline

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Speaker 2: data at eight thirty tomorrow as well. I had a

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Speaker 2: number of other good conversations today. I'll make this quick.

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Speaker 2: Today we're gonna get to Max Kattener optimistic on the markets,

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Speaker 2: Rebecca Patterson optimistic on the markets, Omar Aguilarich, Charles Schwab

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Speaker 2: optimistic on the markets. I think there's like a theme there,

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Speaker 2: and we'll talk to Max Kttener about how that ties

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Speaker 2: into the ten year yield. But first, Lawrence McDonald is

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Speaker 2: someone that everyone reads. He has after his Lehman Brothers days.

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Speaker 2: He's got a report i'll call the bear Trap Report,

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Speaker 2: and like you read it once, you read like ten

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Speaker 2: of his reports, and you have to read them all

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Speaker 2: or skim them all because you know you're going to

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Speaker 2: find one jewel in five or one jewel and ten

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Speaker 2: to the point where Larry MacDonald had my Essay of

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Speaker 2: the Year last year at bear Trap Report, this long,

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Speaker 2: ten thousand word article on what does it mean that

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Speaker 2: there's trillions and trillions and trillions of dollars of just

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Speaker 2: money out there? And I mean it's all there is

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Speaker 2: to it. It's codified into a new book. I'm gonna

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Speaker 2: give you the whole title, this may take the whole podcast,

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Speaker 2: How to Listen When Markets Speak, Risks myths and investment

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Speaker 2: opportunities in a radically reshaped economy. It's a radical book

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Speaker 2: and that it's in plain English with lots of appendices

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Speaker 2: and little bullet points in as well. He's got a

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Speaker 2: bunch of muckety bucks on the back, Mark Cuban, Jillian

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Speaker 2: Ted of the fteen, now Ferguson, doctor Brenner, Ian Bremer

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Speaker 2: is is there as well, and Greg Zuckerman with his

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Speaker 2: wonderful work at the Journal. And the answer is McDonald's

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Speaker 2: always thinking outside the box. And I really recommend to

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Speaker 2: you how to listen when Markets Speak. Here's Lawrence McDonald

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Speaker 2: on the Wall of Money personified by passive investing.

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Speaker 1: Think about passive investing right, and Jack bowl GOLs up

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Speaker 1: and heaven God bless him. But you know, the vanguard

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Speaker 1: origination of passive investing. Passive it's starting with the best

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Speaker 1: of intentions, the best of intentions, but at some point

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Speaker 1: passive becomes a little bit more evil because there's thirty

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Speaker 1: five trillion, at least thirty five trillion tied to the

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Speaker 1: index S and P. And so when you have a

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Speaker 1: stock like Nvidia that's now become five percent of the

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Speaker 1: S and P five five percent and it's trading eighty

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Speaker 1: percent above it's two hundred day moving average. Meanwhile, you know,

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Speaker 1: the energy sector as a whole is only three percent

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Speaker 1: of the S ANDP. And so what happens is at

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Speaker 1: some point, too much money is in passive investing. There's

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Speaker 1: not a lot of thinking behind that, and it gets

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Speaker 1: very crowded in what we call herdy, like a herd,

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Speaker 1: and it creates more distortions on the upside, and it

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Speaker 1: will create more distortions on the downside.

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Speaker 2: And my point there with Larry that it would add

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Speaker 2: to is it just creates a distance. Years ago, people

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Speaker 2: that were in the market were much more in it,

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Speaker 2: whether they lost money or gain money, and many many

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Speaker 2: people overtraded and made wrong decisions and bought at the

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Speaker 2: top and all that, and I'm not saying it was

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Speaker 2: a better place, but it was a different place. Is

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Speaker 2: that now so many people they're just not engaged in

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Speaker 2: the EBB and the flow of the market. We will

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Speaker 2: become engaged. And I believe it's April twelfth here, in

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Speaker 2: seven eight days with the earning season beginning. We really

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Speaker 2: focus on the major banks there, JP Morgan and others

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Speaker 2: coming out, and then under the tech earnings and such.

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Speaker 2: But I really take pride in what Bloomberg Surveillance does

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Speaker 2: in giving you the dynamics of free cash flow, the

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Speaker 2: dynamics of revenue and down the income statement. And we'll

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Speaker 2: do that here acting like active investors. Max Kettener is

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Speaker 2: always active at HSBC. There was a point where he

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Speaker 2: was a little bit cautious in the market, but he's

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Speaker 2: really brought it around to a constructive optimism about what's

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Speaker 2: up out there, and he folds it out to where

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Speaker 2: the ten year yield is. Here's Max Kittener linking equities

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Speaker 2: to the ten year yield.

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Speaker 3: What we see at the moment is a bit around

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Speaker 3: actually rates volatility rather than what yields do. Per se.

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Speaker 3: I don't really care whether you know the ten year

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Speaker 3: is going to be at four, at five or at three.

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Speaker 3: As long as intrast rate volatility goes down, that I

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Speaker 3: think is the most important thing. And that's what we

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Speaker 3: have been seeing, except for the last two three days.

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Speaker 3: For the majority of twenty twenty four, interest rate volatility

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Speaker 3: was declining quite strongly and that freed up some risk premium,

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Speaker 3: both in credit spreads and also in equity markets. So,

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Speaker 3: in all honesty, even if fields were to stay at

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Speaker 3: these levels, or even if they do trend a little

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Speaker 3: bit higher, which would be contrary to our rates, how's

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Speaker 3: you as you said, Well, even if that happened, as

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Speaker 3: long as it's gradual, right, as long as interest rate

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Speaker 3: volatility remains subdued or perhaps goes down even further, that

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Speaker 3: is still really good for equity multiples.

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Speaker 2: Max Kitten HSBC and the idea of Max Kattner in

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Speaker 2: London LinkedIn with Steve Major in Hong Kong on fixed

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Speaker 2: income as a very powerful duel. Look for that within

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Speaker 2: HSBC literature. I know Steve Major was a very large

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Speaker 2: presence out on LinkedIn as well. Our social media is LinkedIn.

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Speaker 2: An ex Eric, did you know I got a bluest

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Speaker 2: star over date Elon called me up. He says, I'm

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Speaker 2: such a hitter. No, it was just because of the bow.

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Speaker 2: Tai Elon called up. He said, I'm giving you a

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Speaker 2: blue star and me and a lot of other people.

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Speaker 2: So what do you have any idea what they're doing?

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Speaker 2: I have no idea. Yeah, but all of a sudden,

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Speaker 2: X is like throwing around blue stars, and I have

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Speaker 2: no idea what that means. What I know is we

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Speaker 2: are out on Twitter and we're out on LinkedIn as well,

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Speaker 2: trying to give you the perspective of many of these

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Speaker 2: good people like Max Kuttner and of course Larry McDonald

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Speaker 2: at the bear Trap Report, that book again, how to

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Speaker 2: listen when markets speak, Big day tomorrow, the Jobs Report.

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Speaker 2: We are out. Then on Bloomberg Radio, Sweeny mentions we

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Speaker 2: have to mention Bloomberg Radio, which we do, and also

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Speaker 2: on Apple car Play. Can't say enough about it. The

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Speaker 2: Bloomberg Business app downloaded for free and it gets you

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Speaker 2: into Apple car Play. It's safer, it's better. It's also clearer,

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Speaker 2: which is you know, good sonics and fidelity and all that.

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Speaker 2: And on YouTube growing every day you go and you

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Speaker 2: search Bloomberg podcasts. We're working on that. Are they going

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Speaker 2: to put our ugly face on their eric and it

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Speaker 2: was one day it's going to be there, but it

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Speaker 2: says Bloomberg surveying. Let's you. You click on it at

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Speaker 2: seven zero zero Wall Street Time and it gets you

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Speaker 2: to us with a live chat, which is actually very

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Speaker 2: very informative. I got run over today, folks because we

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Speaker 2: were doing Beyonce's new album, and we were doing Jolene

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Speaker 2: and I did Matreka Berg from nineteen ninety seven, which

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Speaker 2: is great. The just iconic singer songwriter from Nashville. Oh

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Speaker 2: my word, the Miley Cyrus people showed up and said,

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Speaker 2: I promise I'm going to listen to myrius, Miley Cyrus, Joelene.

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Speaker 2: I'll do that this weekend. Tomorrow the jobs report that

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Speaker 2: will be our single best idea