WEBVTT - US Consumer Confidence Rises, Tech Earnings 0:00:02.920 --> 0:00:10.799 Bloomberg Audio Studios, podcasts, radio news. You're listening to the 0:00:10.840 --> 0:00:15.000 Bloomberg Intelligence Podcast. Catch us live weekdays at ten am 0:00:15.040 --> 0:00:17.480 Eastern on Apple card playing and Broud Auto with the 0:00:17.520 --> 0:00:21.320 Bloomberg Business App. Listen on demand wherever you get your podcasts, 0:00:21.640 --> 0:00:23.320 or watch us live on YouTube. 0:00:24.960 --> 0:00:27.160 So let's get to the consumer confidence numbers coming in 0:00:27.280 --> 0:00:31.000 for July at one hundred point three, although you had 0:00:31.080 --> 0:00:33.800 June revised slightly lower. We're going to get the read 0:00:33.880 --> 0:00:36.480 now with Dana Peterson, Chief Economists at the Conference Board. 0:00:36.520 --> 0:00:39.040 I labeled this good but with a question mark. Can 0:00:39.080 --> 0:00:40.920 you help me understand if this is a good report 0:00:41.000 --> 0:00:43.960 bad report? What this means? I think it's kind of 0:00:44.000 --> 0:00:44.640 a mixed report. 0:00:44.760 --> 0:00:46.680 Yes, the headline ticked up a bit, but if you 0:00:46.720 --> 0:00:48.879 look over the last two years, it's been basically been 0:00:48.960 --> 0:00:52.040 moving around in the same range, it's been moving sideway. 0:00:52.159 --> 0:00:55.160 So and really that headline is made up of five 0:00:55.240 --> 0:01:00.880 different indicators, including thoughts about business environment, employment, and also income. 0:01:01.040 --> 0:01:04.319 And certainly when you look at the present situation, consumers 0:01:04.640 --> 0:01:08.240 are becoming less optimistic about the present situation, and they 0:01:08.280 --> 0:01:11.200 have been kind of dour on expectations, even though the 0:01:11.400 --> 0:01:15.039 expectations index ticked up a bit, it's still below eighty, 0:01:15.160 --> 0:01:16.959 and eighty is kind of a signal of trouble. 0:01:17.319 --> 0:01:19.360 So what is the history? What does it tell us 0:01:19.480 --> 0:01:21.520 what consumers are going to actually do. 0:01:23.720 --> 0:01:23.920 Well? 0:01:24.080 --> 0:01:26.200 I think it's good to look at the guts of 0:01:26.240 --> 0:01:28.200 the report where we ask them what are you planning 0:01:28.240 --> 0:01:31.240 on doing about spending on goods and services? So with 0:01:31.400 --> 0:01:33.640 respect to goods, for the most part, they are not 0:01:33.800 --> 0:01:35.640 interested in buying homes or cars. 0:01:35.920 --> 0:01:36.839 They were a little bit more. 0:01:36.800 --> 0:01:43.000 Interested in buying appliances and also electronics like PCs and laptops. 0:01:43.080 --> 0:01:47.040 But when it comes to spending on services, they're definitely downtrading, 0:01:47.120 --> 0:01:49.360 and they're saying we're going to spend mainly on services 0:01:49.440 --> 0:01:52.120 we need, not things we want, and we'll go to 0:01:52.440 --> 0:01:54.120 will stream instead of going to the movies. 0:01:54.720 --> 0:01:57.880 Oh that's interesting, Okay, So when except for Deadpool obviously, 0:01:58.520 --> 0:02:00.760 when did you get an indication the survey of when 0:02:00.840 --> 0:02:04.240 that stops, like how sensitive that reading in terms of 0:02:04.280 --> 0:02:07.400 spending on services and downtrading might be to a rate 0:02:07.520 --> 0:02:08.320 cut for example? 0:02:09.760 --> 0:02:10.640 Well, we look at. 0:02:10.560 --> 0:02:13.160 These measures on a six month moving average, because from 0:02:13.200 --> 0:02:15.919 months to month they're pretty voluable, volatile and over the 0:02:16.120 --> 0:02:18.519 last six months, it continues to weaken in terms of 0:02:18.560 --> 0:02:22.280 buying durables. That makes sense because we know that durables 0:02:22.280 --> 0:02:25.639 are expensive and also you have to finance them. We 0:02:25.760 --> 0:02:28.400 did see in the Q two GDP report a pickup 0:02:28.480 --> 0:02:30.400 in spending on durables, but I think it was also 0:02:30.520 --> 0:02:34.079 because prices were lower, so consumers kind of jumped in there. 0:02:34.520 --> 0:02:37.400 But really we're not seeing much in terms of a 0:02:37.560 --> 0:02:41.399 big desire to buy durables, and certainly with services, they're 0:02:41.400 --> 0:02:42.520 buying cheaper services. 0:02:42.639 --> 0:02:45.600 All right, Danny, we appreciate thanks for the incident analysis. Aanipeterston, 0:02:45.680 --> 0:02:47.720 chief economist at the Conference Board of joining US. No 0:02:47.800 --> 0:02:49.560 table saws yet for John Tucker. 0:02:51.080 --> 0:02:54.920 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:02:55.040 --> 0:02:58.560 weekdays at ten am Eastern on applecar Play and rout 0:02:58.600 --> 0:03:01.720 Outo with the Bloomberg Business. You can also listen live 0:03:01.840 --> 0:03:05.000 on Amazon Alexa from our flagship New York station, Just 0:03:05.080 --> 0:03:07.600 Say Alexa, playing Bloomberg eleven. 0:03:07.440 --> 0:03:12.120 Thirty Alex alongside John Tucker. Paulsweeny is off today. This 0:03:12.720 --> 0:03:15.359 is Bloomberg Intelligence Radio. We bring you all the top 0:03:15.440 --> 0:03:17.799 news and business, economics and finance through are lens of 0:03:17.800 --> 0:03:20.959 our Bloomberg Intelligence folks. They cover two thousand companies and 0:03:21.040 --> 0:03:23.640 a one hundred and thirty industries all around the world. 0:03:23.880 --> 0:03:26.600 We also have an amazing print team here at Bloomberg, 0:03:26.680 --> 0:03:29.919 and they literally cover everything around the world, particularly when 0:03:29.960 --> 0:03:32.919 it comes to money and politics. What's not to like 0:03:33.320 --> 0:03:36.520 about that? Combo? Michael Smith is joining us now, senior 0:03:36.560 --> 0:03:39.400 reporter on Bloomberg's national team is joining us on Ken 0:03:39.440 --> 0:03:43.160 Griffin spending boatloads of money to put his stamp on 0:03:43.320 --> 0:03:46.280 Trump's goop. Michael, walk me through what. 0:03:46.320 --> 0:03:50.640 You learned, Well, what we learned is that Ken Griffin 0:03:50.680 --> 0:03:53.080 is one of the most influential donors to the Republican 0:03:53.160 --> 0:03:57.720 Party in America. In the last ten years or so, 0:03:58.000 --> 0:04:00.760 he's donated almost two hundred and fifteen million dollars to 0:04:00.960 --> 0:04:06.080 Republican causes and candidates, and this year alone, he's spending 0:04:06.200 --> 0:04:09.920 tens of millions of dollars to back the Republican primary 0:04:10.000 --> 0:04:13.720 candidates that he really likes that sort of share his conservative, 0:04:14.040 --> 0:04:18.320 pro business views and sometimes that sort of clashes with 0:04:18.680 --> 0:04:22.200 the Republican Party that Trump has has shaped, which is 0:04:22.279 --> 0:04:25.359 much more populist in orientation. 0:04:26.040 --> 0:04:28.960 Just to remind everybody who Ken Griffin is where he 0:04:29.040 --> 0:04:29.880 gets his money from. 0:04:31.120 --> 0:04:36.440 Yeah, so Ken Griffin is he's He's worth about forty 0:04:36.440 --> 0:04:39.600 two billion dollars as of late. He's the founder and 0:04:39.839 --> 0:04:43.400 owner of Citadel, which is a one of the largest 0:04:43.480 --> 0:04:47.080 hedge fund and securities trading firms on Wall Street in 0:04:47.160 --> 0:04:51.680 the world. Actually, and he's incredibly influential or in terms 0:04:51.720 --> 0:04:54.120 of philanthropy, he gives a lot of money to a 0:04:54.160 --> 0:04:57.560 lot of different causes. And in terms of politics, he's 0:04:57.640 --> 0:05:03.080 quite outspoken Republican publican uh back or so to speak. 0:05:03.640 --> 0:05:09.400 And he he he regularly zooms in on political issues 0:05:09.440 --> 0:05:11.000 that he cares about and he backs it up with 0:05:11.080 --> 0:05:11.440 his money. 0:05:13.360 --> 0:05:16.400 Is this just a Trump thing or is this a 0:05:16.520 --> 0:05:19.320 Republican ticket thing for Ken Griffin. 0:05:19.839 --> 0:05:26.840 Well, it's really, he says. His goal is to get 0:05:26.880 --> 0:05:30.080 people who elected, who will govern well, who will get 0:05:30.160 --> 0:05:32.960 things done along, you know, in the areas that he's 0:05:33.240 --> 0:05:37.880 that he's really interested in, like defense, promoting the American Dream, 0:05:37.920 --> 0:05:39.360 he likes to say, which is a whole sort of 0:05:39.440 --> 0:05:43.960 coterie of of economic policies that he believes in, and 0:05:44.560 --> 0:05:51.159 not obstructing good legislation like he's he's given the candidates 0:05:51.200 --> 0:05:54.000 who have challenged a lot of the you know, Freedom 0:05:54.040 --> 0:05:57.240 Caucus members in the House who have been sort of 0:05:57.320 --> 0:05:59.400 disruptive over the last few years. He doesn't seem to 0:05:59.480 --> 0:06:02.960 want that kind of legislature in the Congress, so he's 0:06:03.000 --> 0:06:06.520 directed his money at candidates along those lines a lot 0:06:06.560 --> 0:06:09.760 of times. It it jibes with what Trump wants. He's 0:06:09.880 --> 0:06:12.920 he's backed a lot of Trump endorsed candidates, but not 0:06:13.160 --> 0:06:17.360 all the time. So he really seems to be forging 0:06:18.279 --> 0:06:19.520 and says he's forging. 0:06:19.279 --> 0:06:22.520 His own way. What does he say about Donald Trump 0:06:22.760 --> 0:06:24.960 or does the money do the talking for him? 0:06:26.560 --> 0:06:30.440 Well, according to the most recent disclosures that we've been 0:06:30.480 --> 0:06:33.080 able to find, which are as of this month, actually 0:06:33.880 --> 0:06:37.720 he hasn't given any money to directly to Trump, and 0:06:38.120 --> 0:06:40.960 historically he's not He hasn't given money to Trump, and 0:06:41.160 --> 0:06:44.360 he's you know, but he had you know, it's not 0:06:45.240 --> 0:06:50.320 he hasn't come out directly against Trump. Uh he says 0:06:50.320 --> 0:06:55.080 he's still deciding, I think, and still sort of to 0:06:55.200 --> 0:06:58.320 be to be to be announced whatever stiff he takes 0:06:58.360 --> 0:07:02.280 by election day. Uh So, but he's been quite careful 0:07:02.400 --> 0:07:07.920 not to directly financed Trump's campaign, at least so far 0:07:08.040 --> 0:07:09.280 from what we can see now. 0:07:09.320 --> 0:07:11.960 It's easy to talk about, you know, Ken Griffin supporting 0:07:12.520 --> 0:07:15.560 the GOP, but you know there's some billionaires also on 0:07:15.760 --> 0:07:18.040 the Democratic side that also put a lot of money 0:07:18.080 --> 0:07:21.600 into these super packs and stuff, right, that's correct. 0:07:22.000 --> 0:07:27.600 This is not a Republican thing. And ever since, you know, 0:07:27.840 --> 0:07:30.240 the Supreme Court made some rulings in the mid two 0:07:30.320 --> 0:07:36.880 thousands that basically allowed individuals or to give as much 0:07:36.920 --> 0:07:39.760 money as they want to so called super packs. These 0:07:39.800 --> 0:07:44.640 are political action committees that back a cause or find 0:07:44.680 --> 0:07:49.080 ways to support candidates. You know, you've got money pouring 0:07:49.120 --> 0:07:52.320 it from both sides, so this is quite common. And 0:07:52.600 --> 0:07:54.320 Ken Griffin just happens to be one of the biggest 0:07:54.360 --> 0:07:55.960 ones on the Republican side. 0:07:56.240 --> 0:08:01.240 So what's his track record of the candidates received his money? 0:08:01.520 --> 0:08:03.679 Has he been successful in getting them elected? 0:08:05.000 --> 0:08:09.080 Well, our reporting shows that he's supported about sixty candidates, 0:08:09.440 --> 0:08:13.200 either via these massive infuses of money to super packs 0:08:13.240 --> 0:08:16.440 that in terms support them, or directly as an individual 0:08:16.560 --> 0:08:20.320 supporting a candidate's campaign. Under federal law, you can give 0:08:20.360 --> 0:08:23.160 up to sixty six hundred dollars per cycle to a 0:08:23.280 --> 0:08:27.680 candidate directly, but you can give unlimited amounts in support 0:08:27.720 --> 0:08:30.160 of a candidate through a pack that targets that campaign. 0:08:30.400 --> 0:08:36.360 So anyway, he's he's supported about sixty candidates, and roughly 0:08:36.400 --> 0:08:40.560 two thirds of those have won their election. The others 0:08:40.600 --> 0:08:41.560 will see what happens. 0:08:42.320 --> 0:08:45.800 Is he a single issue kind of donor? Like, is 0:08:45.840 --> 0:08:49.800 there one thing that he really stands for that he's 0:08:49.880 --> 0:08:52.360 pushing for all the candidates that he's supporting. 0:08:52.040 --> 0:08:57.240 Kind of thing, Yeah, he says he Well, no, it's 0:08:57.280 --> 0:08:59.679 not single issue. I would say it's sort of a 0:08:59.679 --> 0:09:02.400 a package of things. I mean, he cites a number 0:09:02.400 --> 0:09:05.120 of different things, and you know, in his comments to us, 0:09:05.160 --> 0:09:07.880 for example, and just sort of through the reporting that 0:09:07.920 --> 0:09:11.880 we were able to do, you know, securing the borders, 0:09:12.679 --> 0:09:18.320 halting and reversing inflation, protecting young people from war from 0:09:18.360 --> 0:09:23.559 going to war, and also encouraging the American dream. So 0:09:23.679 --> 0:09:25.640 those are pretty sweeping concepts. 0:09:25.720 --> 0:09:27.600 Yeah, it was like that's not very specific, but sure, 0:09:28.520 --> 0:09:32.439 but you know so, But that's that's how he describes 0:09:32.600 --> 0:09:35.480 what he's looking for, and in effect, that's kind of 0:09:35.520 --> 0:09:36.920 the kind of candidates. 0:09:36.559 --> 0:09:44.559 You're seeing, traditional conservative Republicans that he believes fit that 0:09:44.800 --> 0:09:46.400 mold that I just described. 0:09:46.960 --> 0:09:51.040 And money left over to buy a stegosaurus, and didn't. 0:09:50.760 --> 0:09:52.959 You buy something in the south of France. Wasn't it 0:09:53.040 --> 0:09:55.400 a boatload of millions or something? Probably? 0:09:55.640 --> 0:09:59.679 Yes, he just bought a modest home in Santrepez I 0:09:59.720 --> 0:10:05.200 think worth more than a million dollars. And he yes, 0:10:05.400 --> 0:10:10.559 he just bought an auction a complete Stegosaurus skeleton for 0:10:10.679 --> 0:10:11.720 forty five million dollars. 0:10:11.840 --> 0:10:13.439 We just don't know if the Stegosaurus is going in 0:10:13.559 --> 0:10:14.360 his enterpez No. 0:10:14.480 --> 0:10:17.280 I think he's actually donating that to a museum. 0:10:17.640 --> 0:10:20.800 Yes, yeah, Michael, he. 0:10:20.880 --> 0:10:23.200 Is going to exactly he's going to donate to a museum. 0:10:23.320 --> 0:10:24.960 Michael. We got to leave it there. We really appreciated 0:10:25.000 --> 0:10:27.679 Michael Smith joining us from the Bloomberg National team. I 0:10:27.720 --> 0:10:29.520 should put out it's not a big take, my bad, 0:10:29.800 --> 0:10:31.600 but it is a Bloomberg little Bee, which means it's 0:10:31.600 --> 0:10:34.800 an exclusive to Bloomberg News. Definitely check it out by 0:10:34.880 --> 0:10:38.240 Michael Smith and Bill Allison about Ken Griffin and his 0:10:38.760 --> 0:10:42.040 contributions to the GOP and really shaping that party. 0:10:43.720 --> 0:10:47.520 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:10:47.640 --> 0:10:50.440 weekdays at ten am Eastern on Effo CarPlay and then 0:10:50.480 --> 0:10:53.319 Broud Auto with the Bloomberg Business app. Listen on demand 0:10:53.400 --> 0:10:57.080 wherever you get your podcasts. Or watch us live on YouTube. 0:10:58.559 --> 0:11:01.199 I'm Alex Steel here alongside John Tucker. This is Bloomberg 0:11:01.280 --> 0:11:04.080 Intelligence Radio. We bring you all the top news and business, 0:11:04.160 --> 0:11:07.360 economics and finance. There are lens of our Bloomberg Intelligence analysts. 0:11:07.400 --> 0:11:09.960 They cover two thousand companies and one hundred and thirty 0:11:10.000 --> 0:11:12.920 industries worldwide. So our next guest is going to give 0:11:13.000 --> 0:11:15.599 us a great perspective sort of inside the mind of 0:11:15.720 --> 0:11:19.520 hedge funds and institutional investors and other clients. Joining us 0:11:19.559 --> 0:11:23.359 now is Sarah Samuel's head of Investment Manager Strategy at NEPC. 0:11:23.880 --> 0:11:27.640 Any PC is one of the industry's largest independent, full 0:11:27.760 --> 0:11:31.280 service investment consulting firms. They serve more than four hundred 0:11:31.320 --> 0:11:34.720 clients with over one point six trillion dollars in assets 0:11:35.120 --> 0:11:38.000 under advisement. Sarah joins us now. Sarah, great to have 0:11:38.160 --> 0:11:40.160 you joining us from Boston. Thanks for joining us. 0:11:41.320 --> 0:11:42.720 Alex, it's great to see you again. 0:11:43.000 --> 0:11:44.439 Thanks for having me on the show, you bet. I 0:11:44.440 --> 0:11:46.400 also should point out John Tucker that Sarah wrote a 0:11:46.520 --> 0:11:50.760 children's book about financial literacy for kids. Really yes, which 0:11:50.800 --> 0:11:52.000 you know what you and I could probably use. 0:11:52.200 --> 0:11:53.400 I could probably use that. 0:11:53.679 --> 0:11:54.559 I definitely could have used. 0:11:54.559 --> 0:11:59.280 That is still telling kids to save, actually to go a. 0:11:59.280 --> 0:12:01.760 Step further than saving. It's telling them to be brave, 0:12:01.960 --> 0:12:03.960 take some risks and try their hand at investing. 0:12:04.600 --> 0:12:07.920 I think given the current rate environment, you probably have 0:12:08.160 --> 0:12:09.360 to go out a little. 0:12:09.600 --> 0:12:11.960 Yeah. Yeah, we'll get to that too, because my daughter 0:12:12.080 --> 0:12:15.400 very much enjoyed that book. But Sarah, for the pros 0:12:15.520 --> 0:12:18.400 for the profession in the market, what are people thinking 0:12:18.480 --> 0:12:19.080 and doing right now? 0:12:20.440 --> 0:12:22.760 So the big theme that we're seeing among our clients 0:12:22.840 --> 0:12:25.800 at any PC and we work with endowments and foundations, 0:12:26.040 --> 0:12:28.920 we work with family offices, we work with public and 0:12:28.960 --> 0:12:31.440 corporate pension funds, We work with lots of different clients, 0:12:31.760 --> 0:12:35.200 and we help manage their entire portfolios across private markets, 0:12:35.320 --> 0:12:39.360 private equity, page funds, and anything publicly traded. So the 0:12:39.400 --> 0:12:42.160 big theme that we're seeing in our clients' portfolios today 0:12:42.240 --> 0:12:44.840 is that investors are getting less money back from their 0:12:44.880 --> 0:12:48.839 private market investments than they had expected and budgeted. And 0:12:49.480 --> 0:12:52.280 for distributions and dal activity to pick up, we really 0:12:52.400 --> 0:12:56.080 need to see valuations reset further or for the cost 0:12:56.200 --> 0:12:59.160 of capital to come down, which we're beginning to see recently. 0:12:59.760 --> 0:13:01.959 And you know, what we're really telling our clients is 0:13:02.040 --> 0:13:04.560 that this could be a great time to put capital 0:13:04.640 --> 0:13:04.960 to work. 0:13:05.880 --> 0:13:10.560 Okay, So well, let's focus on the liquidity picture right now. 0:13:10.840 --> 0:13:11.400 What is it? 0:13:12.360 --> 0:13:13.480 What are the implications? 0:13:14.240 --> 0:13:16.720 Okay, So when we think about why does liquidity matter, 0:13:16.880 --> 0:13:21.760 especially from private markets investments, because capital and liquidity for 0:13:21.840 --> 0:13:25.719 institutional investors is really necessary to fund their operations and 0:13:25.840 --> 0:13:29.560 to help these institutions achieve their missions. What are their missions? 0:13:29.800 --> 0:13:32.600 You know, this is something where an endowment will send 0:13:32.679 --> 0:13:35.719 college kids to school, a hospital system helps take care 0:13:35.760 --> 0:13:38.640 of the sick, a public fund or a retirement system 0:13:38.960 --> 0:13:42.760 helps retirees live comfortably. And these big money institutions like 0:13:42.840 --> 0:13:46.640 public funds, endowments, foundations, family offices, they might have twenty 0:13:47.280 --> 0:13:49.480 up to forty or maybe even fifty percent of their 0:13:49.520 --> 0:13:53.360 portfolios and private equity and venture capital and private debt 0:13:53.400 --> 0:13:56.079 and real assets. And so this drop in liquidity that 0:13:56.120 --> 0:13:59.440 we've seen, this drop in distributions relative to what they've modeled, 0:13:59.800 --> 0:14:03.040 is really impacting their ability to support their missions. So 0:14:03.240 --> 0:14:07.280 why are these exits lower? Why is there less liquidity today? 0:14:08.040 --> 0:14:10.400 It really has to do with a few things. One 0:14:10.520 --> 0:14:13.319 is the cost of financing so used to be four 0:14:13.400 --> 0:14:16.760 to five percent to take on debt, in a lower 0:14:16.840 --> 0:14:20.600 rate environment for a buyout, for example, and buyout debt 0:14:20.720 --> 0:14:23.560 is typically floating rate, so now it's eight, nine or 0:14:23.640 --> 0:14:27.320 ten percent, and that really eats into the profitability of 0:14:27.360 --> 0:14:30.720 these underlying portfolio companies and buyers and sellers cannot meet 0:14:30.800 --> 0:14:31.200 on price. 0:14:31.640 --> 0:14:34.200 So that's a lot though. I wasn't really aware that 0:14:34.320 --> 0:14:36.560 some of these foundations and family offices have as much 0:14:36.600 --> 0:14:39.760 as forty percent or more like twenty Okay, maybe less, 0:14:40.160 --> 0:14:42.720 but forty percent. Does that number change now that they're 0:14:42.760 --> 0:14:46.040 having a hard time getting those getting their money back? 0:14:46.160 --> 0:14:49.160 In essence, does it change that they allocate. 0:14:49.720 --> 0:14:52.040 You might think that they would be backing off. These 0:14:52.080 --> 0:14:55.160 are really smart investors though, and they're very extremely long 0:14:55.280 --> 0:15:00.160 term oriented. So one study by Polar Capital found at 0:15:00.280 --> 0:15:04.120 over eighty percent of investors plan to increase or hold 0:15:04.160 --> 0:15:07.360 steady their private markets exposure in the next several years. 0:15:07.920 --> 0:15:11.000 And so investors are showing that they really still believe 0:15:11.040 --> 0:15:14.720 in private markets. They are getting frustrated with a lack 0:15:14.760 --> 0:15:15.600 of distributions. 0:15:16.400 --> 0:15:18.479 Does everybody agree on the valuations? 0:15:20.080 --> 0:15:22.720 No, no, we do not agree on the valuations. And 0:15:22.840 --> 0:15:26.000 so we are seeing the m and A market begin 0:15:26.120 --> 0:15:28.040 to warm up again. As I'm sure you've been talking 0:15:28.080 --> 0:15:29.920 about on the show, and that's a function of a 0:15:29.960 --> 0:15:32.680 couple of things. But it's really starting to loosen up 0:15:33.000 --> 0:15:39.320 this transaction capability in the marketplace. And what's happening is 0:15:39.440 --> 0:15:42.280 that banks are beginning to re enter the market, which 0:15:42.400 --> 0:15:46.200 is providing more capital at potentially a lower rate. And 0:15:46.400 --> 0:15:52.040 there's been a bevy of dollars raise for private debt funds, 0:15:52.440 --> 0:15:55.200 and private debt has been lending to these portfolio companies 0:15:55.240 --> 0:15:58.000 at nine or ten percent. Now there's competition for capital. 0:15:58.040 --> 0:15:59.600 So in a way, there's been a sneaky rate cut 0:16:00.160 --> 0:16:02.360 just found its way into the cost of debt financing. 0:16:02.720 --> 0:16:04.920 So it instead of costing nine percent or ten percent 0:16:05.040 --> 0:16:07.760 to take on debt for these types of strategies, it's 0:16:07.840 --> 0:16:10.600 more like eight or nine percent. And the cost of 0:16:10.680 --> 0:16:13.400 financing really has a lot to do with where we're 0:16:13.440 --> 0:16:16.800 able to exit a company and what we do to 0:16:16.880 --> 0:16:20.280 agree upon price. So there are a lot of buyers 0:16:20.280 --> 0:16:21.920 and sellers who are not able to meet in the middle. 0:16:22.160 --> 0:16:24.200 I believe we're going to get there, but the sellers 0:16:24.280 --> 0:16:25.400 may need to come down a little bit. 0:16:25.960 --> 0:16:27.600 This feels like a good moment though, to pivot to 0:16:27.640 --> 0:16:29.840 your book, So I mentioned that you were a children's 0:16:29.840 --> 0:16:32.840 book for literacy for kids, Braving Our Savings. Can you 0:16:32.920 --> 0:16:35.120 tell us like what it's about and how you deal 0:16:35.200 --> 0:16:37.960 with with savings when it comes to your kids, because man, 0:16:38.080 --> 0:16:40.560 when she put me to shame, when when she's telling 0:16:40.560 --> 0:16:41.640 me about this earlier. 0:16:42.320 --> 0:16:45.360 Well, thank you so much Alex for bringing it up. 0:16:45.480 --> 0:16:49.000 So the book is called Braving Our Savings and it's 0:16:49.000 --> 0:16:52.240 a children's book. It's available on Amazon. It's available and 0:16:52.320 --> 0:16:54.360 giving it away to lots of kids. If you know 0:16:54.480 --> 0:16:58.680 of any organizations that are serving underrepresented kids, please let 0:16:58.760 --> 0:17:01.040 me know. But the goal of Braving Our Savings is 0:17:01.080 --> 0:17:03.920 to empower kids from all economic backgrounds to invest and 0:17:04.000 --> 0:17:07.119 be brave. And we've had great support from really a 0:17:07.240 --> 0:17:11.080 trifecta from We've had endorsements from the investment community, so 0:17:11.240 --> 0:17:14.680 folks at Nasdaq for example, and any PC. We've had 0:17:14.960 --> 0:17:17.800 lots of partnerships over twenty with nonprofits, and then the 0:17:17.880 --> 0:17:20.879 pro sports community has really stepped up in endorsing the 0:17:20.920 --> 0:17:25.000 book like Alex Rodriguez, Kyle Arrington, Brandon Copeland, Jonathan Jones. 0:17:25.040 --> 0:17:27.639 These are Patriots players and we all know Alex Rodriguez 0:17:28.119 --> 0:17:30.320 and this has really helped to amplify the message and 0:17:30.400 --> 0:17:33.200 broaden our reach. So we've given over twenty five hundred 0:17:33.200 --> 0:17:35.359 books away to kids at this point, and we're just 0:17:35.400 --> 0:17:36.040 getting started. 0:17:36.480 --> 0:17:40.040 Where is financial literacy right now? Just how big of 0:17:40.080 --> 0:17:41.120 a gap is there? 0:17:41.440 --> 0:17:43.800 Just to it's getting a lot better. So many more 0:17:43.880 --> 0:17:47.240 states are beginning to have it as an essential. Yes, 0:17:47.359 --> 0:17:50.159 it is promising, but the reality is that there's a 0:17:50.240 --> 0:17:52.080 lot of shame and fear around money when you get 0:17:52.119 --> 0:17:54.920 to the individual family level, and that because it's not 0:17:55.040 --> 0:17:58.280 taught in schools, it leaves the discussion to the dinner table, 0:17:58.640 --> 0:18:01.640 and many families just aren't equipped to have these conversations. 0:18:01.960 --> 0:18:04.680 So we want to sort of expand kids families and 0:18:04.720 --> 0:18:06.880 become part of them and begin to show them things 0:18:06.920 --> 0:18:08.960 that maybe their their core tribes aren't able to. 0:18:09.160 --> 0:18:11.680 But what's so interesting, Sarah, is like you talk about 0:18:11.720 --> 0:18:15.600 taking risk, like kids investing in stocks like that. I mean, 0:18:15.840 --> 0:18:17.520 you know, not on like a large scale, but like 0:18:18.040 --> 0:18:21.240 learning how to not only manage money but make money. 0:18:22.359 --> 0:18:24.760 That's right, And you know, it's a really important skill 0:18:24.840 --> 0:18:27.040 to learn. And especially if you come from a place 0:18:27.119 --> 0:18:29.560 of not having much money as a child, you may 0:18:29.600 --> 0:18:32.200 be less likely to take risks, which just extends bad 0:18:32.280 --> 0:18:34.720 cycle and making ends meet, because if you don't take risks, 0:18:34.760 --> 0:18:37.080 then you may not be able to sort of change, 0:18:37.240 --> 0:18:40.359 have a step function change. And I've taught seventeen hundred 0:18:40.440 --> 0:18:42.919 kids alive in the last three months, and I can 0:18:42.960 --> 0:18:44.680 tell you that they get it, even at a very 0:18:44.720 --> 0:18:45.160 young age. 0:18:45.280 --> 0:18:48.639 They talk about day traders. 0:18:48.560 --> 0:18:49.800 Right, Yeah, that's right. 0:18:49.920 --> 0:18:50.920 We need to be careful of that. 0:18:51.160 --> 0:18:53.560 No, no day traders, Like there's still a risk element 0:18:53.640 --> 0:18:57.240 that we want to protect. But it's super awesome us. 0:18:57.520 --> 0:18:59.760 Thank you, Sarah, Thanks a lot, We really appreciate it. 0:19:00.119 --> 0:19:03.440 Thank you for the perspective head of investment Manager Research 0:19:03.720 --> 0:19:06.080 over at any PC. But also thank you for the book, 0:19:06.240 --> 0:19:08.800 Sarah Braving Our Savings. I'll be buying one for John 0:19:08.880 --> 0:19:13.960 Tucker just after the break. Sarah Samuels joining us from Boston, Massachusetts. 0:19:14.080 --> 0:19:16.200 But it's such an interesting point. I mean, I remember 0:19:16.840 --> 0:19:20.280 I didn't know anything about budgeting or savings or how 0:19:20.320 --> 0:19:23.119 to manage anything until I bought like a book in 0:19:23.200 --> 0:19:24.920 my late twenties. When I was in debt. It was 0:19:24.960 --> 0:19:26.280 like how to get out of debt? And that's when 0:19:26.280 --> 0:19:27.520 I started to learn stuffy. 0:19:27.600 --> 0:19:31.640 I would argue a lot of small business owners don't 0:19:31.720 --> 0:19:35.679 know it either, especially those like doctors and dentists. They 0:19:35.720 --> 0:19:38.680 don't teach you business in those schools. 0:19:39.160 --> 0:19:40.720 Which you really should. And I like the idea that 0:19:40.800 --> 0:19:44.280 you're actually sort of investing to grow, not just putting 0:19:44.320 --> 0:19:46.760 money in a city bank savings account, no offensive city bank, 0:19:46.800 --> 0:19:48.840 but actually like trying to think about wealth in a 0:19:48.920 --> 0:19:50.760 different way. I thought that was really cool. 0:19:51.760 --> 0:19:52.000 Great. 0:19:52.400 --> 0:19:53.920 You know you gotta save up to by that table saw. 0:19:55.440 --> 0:19:59.280 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:19:59.359 --> 0:20:03.160 weekdays ten am Eastern on applecar Play and Android Otto 0:20:03.320 --> 0:20:06.240 with the Bloomberg Business. You can also listen live on 0:20:06.359 --> 0:20:10.160 Amazon Alexa from our flagship New York station Just Say Alexa, 0:20:10.400 --> 0:20:12.320 playing Bloomberg eleven thirty. 0:20:13.640 --> 0:20:16.719 Alex Stee alongside John Tucker. Paul Sweeni's off today. It's 0:20:16.760 --> 0:20:19.080 a Bloomberg Intelligence Radio. We bring you all the top 0:20:19.160 --> 0:20:21.640 news and business and finance and economics to your lens 0:20:21.920 --> 0:20:24.840 of our Bloomberg Intelligence folks. They cover two thousand companies 0:20:25.000 --> 0:20:27.119 and one hundred and thirty industries around the world, and 0:20:27.200 --> 0:20:29.400 one of them is on a rag run up Bloomberg 0:20:29.480 --> 0:20:32.920 Intelligence senior technology analyst, and he's joining us to look 0:20:32.960 --> 0:20:36.000 ahead to Microsoft earnings, but also like what is happening 0:20:36.080 --> 0:20:40.240 right now? Microsoft is down almost two percent in Nvidia 0:20:40.440 --> 0:20:42.800 is off by over six percent. Tech is starting to 0:20:42.840 --> 0:20:45.280 get hit very hard on arag what's going on? 0:20:46.640 --> 0:20:47.960 So I think if you look at it, you know, 0:20:48.040 --> 0:20:50.840 since the launch of Chat GPT, you know, a year 0:20:50.880 --> 0:20:52.560 and a half ago or so almost two years ago, 0:20:52.880 --> 0:20:55.679 we have seen a massive run up in all technology stocks, 0:20:55.720 --> 0:20:58.920 except especially the largest and the biggest ones. And what 0:20:59.119 --> 0:21:02.440 we've sawday and what we've been seeing for the last 0:21:02.760 --> 0:21:05.440