WEBVTT - Jobs, Markets, and Higher Ed 0:00:00.120 --> 0:00:04.360 Bloomberg is now on your dashboard with Apple CarPlay and 0:00:04.360 --> 0:00:08.160 Android Auto. It gives you access to every Bloomberg podcast, 0:00:08.280 --> 0:00:11.560 live audio feeds from Bloomberg Radio, print stories from Bloomberg 0:00:11.640 --> 0:00:14.920 News in audio form, and the latest headlines of the 0:00:14.920 --> 0:00:18.600 click of a button with Bloomberg News. Now it's free 0:00:18.680 --> 0:00:21.439 with the latest version of the Bloomberg Business App. That's 0:00:21.680 --> 0:00:24.400 the Bloomberg Business App. Get it on your phone in 0:00:24.440 --> 0:00:27.760 the Apple App Store or on Google Play. Just download 0:00:27.800 --> 0:00:30.560 the app, connect your phone to your car and get started. 0:00:30.960 --> 0:00:34.400 And it's all presented by our sponsor, Interactive Brokers. 0:00:35.400 --> 0:00:38.600 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside 0:00:38.640 --> 0:00:39.800 my co host Matt Miller. 0:00:40.200 --> 0:00:44.279 Every business day we bring you interviews from CEOs, market pros, 0:00:44.320 --> 0:00:48.160 and Bloomberg experts, along with essential market movin news. 0:00:48.720 --> 0:00:51.839 I'm the Bloomberg Markets podcast called Apple Podcasts or wherever 0:00:51.960 --> 0:00:55.080 you listen to podcasts, and at Bloomberg dot Com Slash podcast. 0:00:55.680 --> 0:00:58.000 Looking at the jobs data headline on the terminal. One 0:00:58.040 --> 0:01:00.640 of the stories that reads by US labor market defive 0:01:00.720 --> 0:01:03.800 slow down forecasts in broadening strength right now, want to 0:01:03.800 --> 0:01:07.600 bring in Tom Gibble. He is the CEO at Lassal Network, 0:01:07.680 --> 0:01:11.240 joining us on Zoom Tom. When you look at the 0:01:11.360 --> 0:01:14.480 jobs report that we saw too hot to handle, what 0:01:14.560 --> 0:01:16.720 really stands out to you from this report? 0:01:17.160 --> 0:01:19.960 I think number one is the unemployment number dropping, which 0:01:20.120 --> 0:01:23.240 happens to be somewhat seasonal, but it's still a really 0:01:23.280 --> 0:01:25.600 good sign based on where things were trending over the 0:01:25.640 --> 0:01:30.080 past couple months. And then secondarily, the fact that we 0:01:30.120 --> 0:01:32.759 added one hundred and ninety nine thousand jobs is fantastic. 0:01:32.760 --> 0:01:35.640 But of the one ninety nine, I believe one point 0:01:35.600 --> 0:01:38.720 fifty were non government, which is a really good number 0:01:38.760 --> 0:01:41.280 to see that over seventy five percent of the jobs 0:01:41.280 --> 0:01:44.119 added or non government. So it's a really good sign. 0:01:44.520 --> 0:01:47.000 And now, you know, here's just hoping that that not 0:01:47.080 --> 0:01:51.120 only do they not raise rates, that that they don't 0:01:51.120 --> 0:01:53.000 not lower rates, that they don't raise them as well. 0:01:53.080 --> 0:01:54.320 So I think we're gonna be okay. 0:01:54.920 --> 0:01:55.520 Yeah. 0:01:55.560 --> 0:01:57.720 And in terms of the Ali and his good morning, 0:01:57.800 --> 0:02:01.880 it's manas here alongside average early earnings coming in quite 0:02:01.920 --> 0:02:03.920 nicely plus point four percent month a month year andyar 0:02:03.920 --> 0:02:05.920 it takes you to four percent, So there's no sign 0:02:06.200 --> 0:02:09.640 of the steam coming out of that engine at the moment. 0:02:10.680 --> 0:02:12.880 And this is what markets are going to focus on, 0:02:12.960 --> 0:02:15.840 isn't it, which is, there's no collapse, this is a 0:02:15.919 --> 0:02:18.960 nice soft landing and earnings are strong. 0:02:20.520 --> 0:02:22.720 Well, I think that what people are scared about is 0:02:22.800 --> 0:02:26.680 it's not a landing at all. And I think that 0:02:26.680 --> 0:02:29.800 that is it's the craziest market I've ever seen, craziest 0:02:29.800 --> 0:02:32.120 economy I've ever seen. The stock market continues to go up, 0:02:32.200 --> 0:02:34.160 earnings are positive, unemployments low. 0:02:34.360 --> 0:02:36.680 It's certainly not laying the work for hard landing. 0:02:36.760 --> 0:02:39.480 I mean, that's the whole point. And that's what the bond. 0:02:39.280 --> 0:02:41.919 Market rallied furiously on, which was, you know, some kind 0:02:41.960 --> 0:02:44.960 of a crack in the dams. So what is no 0:02:45.080 --> 0:02:47.360 landing Because no landing doesn't get me two hundred bases 0:02:47.360 --> 0:02:50.000 points of cuts from the FED next year, does it? No? 0:02:50.160 --> 0:02:52.840 But but if they don't think it's landing at all, 0:02:52.880 --> 0:02:55.080 it might get you another another twenty five or fifty 0:02:55.120 --> 0:02:58.440 bases point increase. So you don't want that either. And 0:02:58.000 --> 0:03:01.680 I think hopefully we're at a point now where we 0:03:01.720 --> 0:03:04.120 say let's let this thing ride a little bit. And 0:03:05.120 --> 0:03:07.280 I don't think we'll get the cuts, and I don't 0:03:07.320 --> 0:03:10.800 think we'll get the increase, and so we'll just be 0:03:10.880 --> 0:03:12.200 flat and see what happens. 0:03:12.360 --> 0:03:14.520 What people don't realize. 0:03:14.400 --> 0:03:17.799 Sometimes the economist that's definitely main street is that the 0:03:18.520 --> 0:03:21.560 economy is so much different than we've ever had it 0:03:22.000 --> 0:03:24.400 in the history of this country. And what I mean 0:03:24.440 --> 0:03:28.160 by that is Number one, there's more startups than ever before. 0:03:28.240 --> 0:03:29.880 So Google lays off people. 0:03:30.520 --> 0:03:33.400 Small companies are gobbling these people up that didn't exist. 0:03:33.400 --> 0:03:36.160 There wasn't this startup culture that people could go find 0:03:36.200 --> 0:03:38.400 other jobs. So there's just more companies that exist for 0:03:38.400 --> 0:03:41.800 people to go work at. Number two, because of technology, 0:03:41.840 --> 0:03:44.920 the skills are more transferable. Fifty years ago, if I 0:03:45.040 --> 0:03:48.080 was a General Motors or a Ford or a Chrysler 0:03:48.240 --> 0:03:51.800 car person, that was all I could do. Today, because 0:03:51.840 --> 0:03:55.360 of technology and transferable skills, you're not stuck in one 0:03:55.400 --> 0:03:57.800 industry vertical for your whole career. You can move into 0:03:57.880 --> 0:04:00.560 other areas. And so those are the type of things 0:04:00.560 --> 0:04:03.280 that have made this job's recovery in this job's economy 0:04:03.600 --> 0:04:06.600 so much different than any other time in American history. 0:04:06.960 --> 0:04:10.040 And tom to see some of these rate cuts play out, though, 0:04:10.080 --> 0:04:11.960 does something need to break? I'm just looking at the 0:04:12.080 --> 0:04:14.760 unemployment rate extremely low at three point seven percent, I 0:04:14.800 --> 0:04:17.080 had seen expectations maybe for that to cross the four 0:04:17.120 --> 0:04:18.280 percent threshold. 0:04:19.360 --> 0:04:21.800 Yeah, I think what we're seeing is it's not it's 0:04:21.839 --> 0:04:24.920 not gonna you know, the only way if the if 0:04:24.960 --> 0:04:28.240 the FED really believes that the only way to curb 0:04:28.320 --> 0:04:31.400 inflation and get it down to two percent is to 0:04:31.920 --> 0:04:33.120 have massive layoffs. 0:04:33.120 --> 0:04:34.080 So I think which. 0:04:33.880 --> 0:04:39.200 Would be destructive to the overall economy. Not helpful, but destructive, 0:04:39.400 --> 0:04:42.240 would be to raise rates, you know, one hundred and 0:04:42.279 --> 0:04:46.280 fifty basis points over the next three, four, five, six quarters. 0:04:46.360 --> 0:04:49.440 And I don't think that's gonna happen because right now, 0:04:49.440 --> 0:04:54.040 what we're seeing is companies can survive and operate with 0:04:55.120 --> 0:05:00.240 relatively normal interest rates. And what we had it was 0:05:00.320 --> 0:05:04.479 just too long of an explosion of growth due to 0:05:04.560 --> 0:05:09.120 zero percent interest rates and no repercussions. And that's the challenge. 0:05:09.120 --> 0:05:11.480 Is when you can open up a business as a 0:05:11.560 --> 0:05:14.120 venture capital firm, or you can finance one as a 0:05:14.120 --> 0:05:17.839 private equity firm and have almost no risk of loss, 0:05:18.560 --> 0:05:22.920 that creates a net for everybody. That's just not fair, 0:05:23.000 --> 0:05:25.760 it's not safe, it's not normal. Now what we're seeing 0:05:25.839 --> 0:05:28.760 is with normalized interest rates as we had throughout the 0:05:28.800 --> 0:05:32.280 history of this country, the economy can still survive, and 0:05:32.320 --> 0:05:34.080 that's a positive thing for society. 0:05:34.440 --> 0:05:36.920 One of the biggest debates that we have been having 0:05:37.080 --> 0:05:40.520 during this massive rally in the bond market and sort 0:05:40.520 --> 0:05:43.920 of explosion in equity markets higher, was that we were 0:05:43.920 --> 0:05:47.520 going to face some kind of a debt cliff as 0:05:47.520 --> 0:05:52.960 sort of a refinancing cliff in theory. Do you believe 0:05:53.080 --> 0:05:56.880 that that's part of the reason why we're still sustaining ourselves, 0:05:56.880 --> 0:05:59.120 that that cliff is just not materializing. 0:06:00.320 --> 0:06:03.080 Yeah, I think it's a matter of time. I think 0:06:03.120 --> 0:06:05.400 what we've got is is that there's more equity in 0:06:05.480 --> 0:06:09.599 people's homes than we've ever had before, and at the 0:06:09.640 --> 0:06:13.120 same time, the rate on borrowing money is increased, and 0:06:13.200 --> 0:06:15.839 so what we've seen is people have the ability to 0:06:15.960 --> 0:06:20.279 borrow more, and we're seeing consumer debt increase. We just 0:06:20.360 --> 0:06:22.880 haven't seen it hit the wall yet. And I think 0:06:22.920 --> 0:06:26.840 that the biggest change I've seen in consumer spending and 0:06:26.880 --> 0:06:30.560 debt versus ever before is that people used to borrow 0:06:30.839 --> 0:06:33.919 and have home equity lines or whatever it was, but 0:06:34.000 --> 0:06:37.480 they were also saving for rainy day. And now what 0:06:37.520 --> 0:06:40.280 it seems like is no matter how much money people have, 0:06:40.839 --> 0:06:43.160 the saving for rainy days gone out the window because 0:06:43.200 --> 0:06:45.720 there's this sense of the government will step in. I'm 0:06:45.720 --> 0:06:47.719 not going to get kicked out of my house, and 0:06:47.760 --> 0:06:51.279 there's an overall cultural shift that's existed, and I do 0:06:51.360 --> 0:06:53.000 think I don't think it's going to happen in twenty 0:06:53.040 --> 0:06:56.000 twenty four, but eventually the rubber's going to hit the 0:06:56.080 --> 0:06:59.159 road there due to the deficit and the large amount 0:06:59.160 --> 0:07:00.320 of individual debt as well. 0:07:00.680 --> 0:07:03.560 Yeah, we're talking to CEO. Let's sell on network, Tom Gibble. Tom, 0:07:03.600 --> 0:07:05.839 you make an interesting point because when we were talking 0:07:05.839 --> 0:07:08.440 around Black Friday and Cyber Monday sales, it seemed like 0:07:08.440 --> 0:07:10.480 the consumer was more than happy to use things like 0:07:10.600 --> 0:07:12.920 buy now, pay later, taking on credit card debt to 0:07:13.000 --> 0:07:15.280 keep buying goods. You're talking about the rubber hitting the 0:07:15.360 --> 0:07:18.000 road in twenty twenty five. How does that shake out 0:07:18.240 --> 0:07:20.040 with a labor market that you've made the point to 0:07:20.480 --> 0:07:23.400 that's still strong and still has quite a number of 0:07:23.440 --> 0:07:25.160 transferable skills. If people were to be. 0:07:25.200 --> 0:07:28.640 Laid off, well, I think that's exactly I think you're 0:07:28.680 --> 0:07:30.360 going to have a big come up and soid it'll 0:07:30.400 --> 0:07:33.240 probably make a difference of who wins in the election 0:07:33.360 --> 0:07:36.040 in twenty four and where Congress sits of what the 0:07:36.080 --> 0:07:36.800 bailout will be. 0:07:37.120 --> 0:07:38.000 So now we've. 0:07:37.760 --> 0:07:40.840 Had, you know, in the past fifteen years, we've had 0:07:40.920 --> 0:07:44.280 the recession and the corporate bailout, We've had the pandemic 0:07:44.320 --> 0:07:46.800 and the consumer bailout. So now we're going to look 0:07:46.840 --> 0:07:49.000 and we're going to see what's going to happen when 0:07:49.000 --> 0:07:54.720 we get if we get another recession, and how bad 0:07:54.760 --> 0:07:57.720 it gets on the homeowner side, on the residential, on 0:07:57.800 --> 0:08:01.000 the commercial real estate side, and what we see with 0:08:01.040 --> 0:08:04.760 the continuing growth of the national deficits. So I think 0:08:04.840 --> 0:08:08.400 that because we've had this expansion of companies and to 0:08:08.520 --> 0:08:11.640 quote Tom Freeman, right, the world really is flat from 0:08:11.680 --> 0:08:15.920 a standpoint of jobs being able to be done anywhere 0:08:15.920 --> 0:08:19.200 in the world, that I think people are going to 0:08:19.280 --> 0:08:22.920 realize that they've got to work, and they're going to 0:08:23.000 --> 0:08:25.960 take jobs below what they were making. Salaries are inflated 0:08:26.040 --> 0:08:28.520 right now. I don't care what anybody says. We're up 0:08:28.560 --> 0:08:33.240 four percent. Wages are and what's gone on in the 0:08:33.280 --> 0:08:37.720 past thirty months with wage increases on the hourly side, 0:08:37.720 --> 0:08:40.960 and the salary is crazy to happen that fast, and 0:08:41.000 --> 0:08:43.880 it's going to come down, whether it's in twenty five 0:08:44.000 --> 0:08:46.920 or twenty six. It's going to come back down eventually, 0:08:47.320 --> 0:08:49.680 and I think that as long as people have jobs 0:08:49.679 --> 0:08:51.120 when that happens, will be okay. 0:08:51.400 --> 0:08:54.600 But you will see that that recalibration on wages. 0:08:54.880 --> 0:08:57.400 But that's interesting. So you're saying we see kind of 0:08:57.440 --> 0:09:00.320 a resetting of wages in twenty five, twenty six, in 0:09:00.360 --> 0:09:02.480 twenty four, like in terms of when you're looking at 0:09:02.640 --> 0:09:06.880 the labor market, wage growth, recession risks, that's not a 0:09:06.880 --> 0:09:08.600 twenty four story at all in your view. 0:09:08.600 --> 0:09:10.040 I don't think it's going to be a twenty four stor. 0:09:10.040 --> 0:09:11.520 I think it's going to be a twenty four story 0:09:11.520 --> 0:09:13.839 for two reasons. I think number one, we've still got 0:09:13.840 --> 0:09:16.400 the infrastructure bill, and so what that means is the 0:09:16.440 --> 0:09:19.120 government's hiring people like it hired twenty five percent of 0:09:19.160 --> 0:09:22.360 the one ninety nine that we're added in the November 0:09:22.440 --> 0:09:26.360 jobs report, and that leads to trickle down economics to 0:09:26.840 --> 0:09:30.960 the private sector on the infrastructure package. So we've still 0:09:31.000 --> 0:09:34.120 got this infrastructure package and all those trillions being spent, 0:09:34.600 --> 0:09:37.800 so that keeps things afloat. In twenty four plus, you 0:09:37.800 --> 0:09:41.320 have an election cycle year, which there's obviously incentive for 0:09:41.360 --> 0:09:44.520 that to keep the economy humming as well. So twenty 0:09:44.559 --> 0:09:47.560 four I don't see being a problem whatsoever. I think 0:09:47.600 --> 0:09:50.240 that we're pushing things. We're kicking the can down the 0:09:50.320 --> 0:09:50.959 road a little bit. 0:09:51.440 --> 0:09:53.520 I just want to come back as an intern on 0:09:53.559 --> 0:09:55.280 Wall Street. We're I get one hundred and twenty dollars 0:09:55.320 --> 0:09:57.559 in our next summer. I'll just leave you with that thought. 0:09:57.920 --> 0:10:00.320 That's what we're paid in twenty twenty three. Will they 0:10:00.360 --> 0:10:01.920 be able to command that in twenty twenty four? 0:10:03.360 --> 0:10:05.920 Interesting conversation though, Thank you so much. Tom Gibble again, 0:10:06.160 --> 0:10:10.120 CEO at Lasal Network, joining us via zoom from Chicago. 0:10:11.600 --> 0:10:15.040 You're listening to the team. Ken's a live program Bloomberg 0:10:15.080 --> 0:10:18.480 Markets weekdays at ten am Eastern on Bloomberg dot Com, 0:10:18.520 --> 0:10:21.640 the iHeartRadio app, and the Bloomberg Business App, or listen 0:10:21.720 --> 0:10:23.840 on demand wherever you get your podcasts. 0:10:25.960 --> 0:10:29.600 Baby Filton, Manus Granny here filling in for Paul and Matt, 0:10:29.920 --> 0:10:34.319 Joined now by Nancy Tangler, CEO and CIO at Laffer 0:10:34.559 --> 0:10:38.920 Tangler Investments. Here in the Bloomberg Interactive Studio. Nancy, we 0:10:38.920 --> 0:10:41.960 get jobs data, We get University of Michigan sentiment data. 0:10:42.559 --> 0:10:45.280 Markets are trading higher. Too hot to handle this. It 0:10:45.360 --> 0:10:48.320 seems like we were not initially kind of gearing up 0:10:48.320 --> 0:10:50.360 for this kind of a market reaction in the pre 0:10:50.400 --> 0:10:50.959 market trading. 0:10:51.200 --> 0:10:53.680 Yeah, well, I think I think the volatility well, first 0:10:53.679 --> 0:10:55.600 of all, it's friend to the long term investor. So 0:10:55.920 --> 0:10:57.920 if you were in there buying early this morning or 0:10:58.000 --> 0:11:00.880 pre market, you're in good shape. But I also think 0:11:00.920 --> 0:11:04.160 that the Michigan numbers were more important than the jobs numbers. 0:11:04.160 --> 0:11:07.160 They weren't really the jobs numbers that is as robust 0:11:07.280 --> 0:11:10.559 as the headlines indicated. So you saw, you know, the 0:11:10.600 --> 0:11:13.320 return of UAW and screenwriters. You saw a lot of 0:11:13.320 --> 0:11:17.320 healthcare jobs, but manufacturing jobs were down. So I think 0:11:17.360 --> 0:11:20.440 that the initial reaction was ill informed. Remember that it's 0:11:20.480 --> 0:11:25.040 the algorithms that are reading the headlines, you know, driving volatility. 0:11:24.800 --> 0:11:28.599 But the Michigan numbers were actually, I think, quite encouraging, 0:11:28.840 --> 0:11:31.080 and I'm loving this rally. 0:11:31.559 --> 0:11:35.199 Those pesky i'l goes and I have it in good 0:11:35.200 --> 0:11:38.160 authority that they have financial cloud. The one year inflation 0:11:38.240 --> 0:11:42.200 expectations come in at three point one percent on the 0:11:42.240 --> 0:11:47.960 Michigan numbers. Now that is perhaps the more significant piece 0:11:48.040 --> 0:11:49.959 that the bomb market will look towards, isn't it. 0:11:50.080 --> 0:11:50.400 Yeah? 0:11:50.440 --> 0:11:53.480 And hugely better than the market was expected. 0:11:53.600 --> 0:11:57.240 Full point three was the expectation previously full point five percent. 0:11:57.600 --> 0:11:59.040 Yeah, so you're right, man. 0:11:59.200 --> 0:12:01.480 I think one of the things that we've been arguing 0:12:01.559 --> 0:12:03.920 is that inflation, Yes, it is coming down. I think 0:12:03.960 --> 0:12:08.440 what the disconnect between most people and us the financial 0:12:09.000 --> 0:12:11.880 community is that maybe coming down, but there are still 0:12:11.920 --> 0:12:13.880 embedded very high costs. 0:12:13.920 --> 0:12:14.240 I think. 0:12:14.400 --> 0:12:16.080 So that's why I think the Michigan. 0:12:15.760 --> 0:12:19.120 Numbers are so powerful, because there seems to be some 0:12:19.160 --> 0:12:22.160 realization that we're at the end by the consumer. Maybe 0:12:22.200 --> 0:12:24.040 they can you know, sort of absorb some of these 0:12:24.120 --> 0:12:24.880 higher prices. 0:12:25.120 --> 0:12:27.480 Can I just say, as a recent transplant to your 0:12:27.559 --> 0:12:32.040 fine country and your esteemed city, my gosh, it's expensive. 0:12:32.080 --> 0:12:35.160 And I have come from one hallish expensive city, from Dubai, 0:12:35.200 --> 0:12:37.719 from the Middle East on food on boost and there 0:12:37.760 --> 0:12:40.360 was no tax. There was no income tax there. I mean, 0:12:40.400 --> 0:12:42.640 I'm being taxed within an inch of my life? How strong? 0:12:42.920 --> 0:12:44.000 Where do you want to? Where do you want to 0:12:44.000 --> 0:12:49.280 be in this economy? Because this is this the immaculate disinflation? 0:12:49.640 --> 0:12:52.480 Is this the soft landing of these these these sayings 0:12:52.520 --> 0:12:55.199 are so awful, But but how do you position for it? 0:12:55.240 --> 0:12:57.760 Because it doesn't look brootal or hard well man, I. 0:12:57.760 --> 0:13:00.880 Think we were talking pre show that. My analogy is 0:13:00.920 --> 0:13:02.400 I was alive in the nineties. 0:13:02.080 --> 0:13:03.880 And as was I, I was. 0:13:03.840 --> 0:13:08.320 Managing just for the director show barely and I was 0:13:08.360 --> 0:13:11.400 managing billions of dollars. And this feels a lot like that. 0:13:11.640 --> 0:13:13.720 So you have what I would call and some are 0:13:13.720 --> 0:13:19.840 calling the Fourth Industrial Revolution or a supercycle in technology, digitization, generative, 0:13:19.840 --> 0:13:23.959 cloud computing. I mean, just look at Broadcoms numbers last night, 0:13:24.040 --> 0:13:27.120 and that's the poor man's Nvidia. So if you look 0:13:27.160 --> 0:13:30.760 at that and you say, okay, we had higher inflation, 0:13:31.240 --> 0:13:34.200 we had interest rates that were five to eight percent 0:13:34.280 --> 0:13:36.920 in the nineties, we had an inverted yield curve what 0:13:37.080 --> 0:13:39.800 was called then ASoft landing. I'm not predicting one this time. 0:13:40.120 --> 0:13:42.040 We had a war, we had a recession at the 0:13:42.040 --> 0:13:44.920 beginning of the decade, and yet the Nasdaq was up 0:13:44.960 --> 0:13:46.800 over eight percent, the Dow and the S and P 0:13:46.920 --> 0:13:49.480 were up over four hundred percent. So I think stocks 0:13:49.480 --> 0:13:51.840 can continue to do well in hell here the surprise 0:13:51.920 --> 0:13:54.880 is going to be earnings, I think for most investors, 0:13:54.960 --> 0:13:57.280 and I think what we're seeing now is that for 0:13:57.320 --> 0:13:59.840 the most part, the market's not listening to the FED anymore, 0:14:00.200 --> 0:14:02.880 which I've said, and we don't need to debate. 0:14:02.920 --> 0:14:05.199 It has a credible ratesgized. 0:14:06.559 --> 0:14:09.839 Has a credibility problem for sure. So I want to 0:14:09.880 --> 0:14:12.719 be in overweight technology. I want to be overweight industrials 0:14:12.720 --> 0:14:14.920 because the pmis are bondbing when. 0:14:14.720 --> 0:14:18.440 You're looking at technology, though, is that predominantly within the 0:14:18.480 --> 0:14:20.920 Magnificent seven and friends or you're looking at kind of 0:14:20.960 --> 0:14:23.280 more of a widespread rally within tech. 0:14:23.560 --> 0:14:23.800 Yeah. 0:14:23.880 --> 0:14:26.520 So, so the companies that are so our investing theme 0:14:26.560 --> 0:14:30.480 is old economy companies Bailey that are pivoting to digitization 0:14:30.560 --> 0:14:33.160 and embracing it, and then the new the companies that 0:14:33.200 --> 0:14:36.080 are providing those tools. So so our biggest holdings in 0:14:36.120 --> 0:14:41.240 technology would be Microsoft, Palleto Network Service, now Broadcom. 0:14:42.000 --> 0:14:43.920 I'm probably forgetting half a dozen of them. 0:14:43.960 --> 0:14:47.560 But the names that that are going to drive this 0:14:47.760 --> 0:14:49.120 next supercycle. 0:14:49.880 --> 0:14:51.480 I'm not interested in meta. 0:14:52.240 --> 0:14:54.640 We own a little bit of Google, uh, but we 0:14:54.680 --> 0:14:58.680 want those are in some ways glorified ad companies. We 0:14:58.720 --> 0:15:01.080 want the ones the company instead of driving it. 0:15:01.080 --> 0:15:03.920 It's interesting because when we've had a variety of people 0:15:03.920 --> 0:15:06.640 in through the morning time talking about the propensity for 0:15:06.760 --> 0:15:09.680 mag seven to deliver out sized returns in twenty twenty 0:15:09.680 --> 0:15:11.960 four may well be more challenged, and perhaps you want 0:15:11.960 --> 0:15:14.520 to go a little bit more for breadth. At the 0:15:14.600 --> 0:15:16.480 end of every year, I'm waiting for the Goldmen's report 0:15:16.520 --> 0:15:20.440 to come out on buybacks or whatever. But this is 0:15:20.480 --> 0:15:25.240 where I want to get your sense. Buybacks are incredibly important. 0:15:25.400 --> 0:15:29.120 Apple intermittently do it, and we spend the whole day 0:15:29.360 --> 0:15:32.400 gorging on Apples buy back and bond issue and stuffun 0:15:32.480 --> 0:15:36.160 and whatever. But where will buy backs put a floor 0:15:36.160 --> 0:15:36.680 in this mode? 0:15:36.760 --> 0:15:39.120 Absolutely to what extent took the words right out of 0:15:39.120 --> 0:15:39.440 my mouth. 0:15:39.520 --> 0:15:40.600 It's from the script. 0:15:43.120 --> 0:15:45.760 You secretly did I say? 0:15:46.120 --> 0:15:47.000 How did I read that? 0:15:47.560 --> 0:15:48.320 You said it better? 0:15:49.320 --> 0:15:51.720 Yeah, I think clearly they are going to. And one 0:15:51.760 --> 0:15:53.920 of the things that drives when we'll continue to drive 0:15:53.960 --> 0:15:57.080 that is the insatiable appetite that the shadow banking system 0:15:57.120 --> 0:15:59.480 has for corporate bonds. But if you just look at 0:15:59.480 --> 0:16:00.920 the mag seven and it's not all of them, I 0:16:00.920 --> 0:16:03.720 think it's four or five. They're going to issue one 0:16:03.800 --> 0:16:06.720 hundred billion dollars in share buybacks over the next year 0:16:06.800 --> 0:16:10.040 or two, or claim a one hundred billion, however you want 0:16:10.040 --> 0:16:13.120 to say that. I think that's what we saw in 0:16:13.200 --> 0:16:16.280 twenty twenty and twenty nineteen, and that's what we're going 0:16:16.320 --> 0:16:18.120 to continue to see in twenty twenty three. 0:16:18.160 --> 0:16:18.640 It is, and. 0:16:18.920 --> 0:16:22.960 As Apple's a big chunk of that. So you just 0:16:23.000 --> 0:16:24.680 need them to do what they say they're going to do. 0:16:24.840 --> 0:16:27.359 And so I think you buy the dips in technology. 0:16:27.400 --> 0:16:29.240 And I know there's a lot of people that are 0:16:29.240 --> 0:16:30.360 saying the tech trade is over. 0:16:30.440 --> 0:16:32.600 I just don't agree. I think they're ill informed. 0:16:32.720 --> 0:16:34.960 Well, I'm looking at kind of the catch up trade, 0:16:35.000 --> 0:16:37.320 if you will. We're seeing the equal weighted SMP catching 0:16:37.400 --> 0:16:41.400 up really since that November late October bottom. How do 0:16:41.440 --> 0:16:44.680 you see that playing out in different areas? You mentioned industrials. 0:16:44.760 --> 0:16:46.840 Is that a place that you're continuing to put cash 0:16:46.880 --> 0:16:49.800 to work. What names do you like within the industrial space. 0:16:50.000 --> 0:16:52.240 Yeah, so we like the ones that are automating. And 0:16:52.280 --> 0:16:54.840 I would say broadening out is great for portfolio managers 0:16:54.840 --> 0:16:57.560 because we have to be diversified, Bailey, So you can't 0:16:57.600 --> 0:17:00.840 put all your eggs in the technology basket. But you know, 0:17:00.920 --> 0:17:03.480 Carriers one of our largest holdings in industrials. You saw 0:17:03.480 --> 0:17:09.560 it pop today on the sale. We also like Illinois Toolworks. 0:17:09.680 --> 0:17:13.560 We have exposure to Emerson Electric, and we actually have 0:17:13.600 --> 0:17:16.240 exposure in a different portfolio to Honeywell, so it has 0:17:16.320 --> 0:17:19.520 done not nearly as well as those names. But I 0:17:19.560 --> 0:17:21.600 think you still want to be in the short cycle 0:17:21.840 --> 0:17:26.040 of industrials and then broaden out in We have a 0:17:26.080 --> 0:17:29.880 market weight in healthcare, we have a market weight in financials, 0:17:29.920 --> 0:17:33.680 and an overweight and consumer discretionary, so broadening out is great. 0:17:34.240 --> 0:17:36.920 We were adding risks back into our portfolios in October 0:17:36.920 --> 0:17:39.360 of twenty twenty two, so we were adding to technology 0:17:39.400 --> 0:17:42.520 when the last death no was issued, and we will 0:17:42.560 --> 0:17:44.600 continue to do that as we have the opportunity. 0:17:44.800 --> 0:17:49.000 You mentioned consumer discretionary. It's the chatters died down a bit. 0:17:49.119 --> 0:17:52.280 But what's your thought on kind of this ozempic trend 0:17:52.359 --> 0:17:55.280 and is that really going to reshape the entire economy 0:17:55.280 --> 0:17:56.159 and how people spend. 0:17:56.359 --> 0:17:57.520 I don't think so, Bailey. 0:17:57.640 --> 0:18:00.280 I mean, you know, I was around when we had 0:18:00.320 --> 0:18:02.520 fen Fenn and for a while it was great, and 0:18:02.600 --> 0:18:04.919 then all the side effects showed up, and I just 0:18:04.920 --> 0:18:07.560 don't think there's enough data. And I was just in 0:18:07.600 --> 0:18:11.600 the Midwest and they have not gotten the ozembic message 0:18:12.040 --> 0:18:14.200 or the memo, So I think I think it will 0:18:14.200 --> 0:18:17.359 have an impact mildly, but I don't think it's going 0:18:17.440 --> 0:18:21.239 to hurt these companies, like the initial reaction indicated. 0:18:20.880 --> 0:18:22.879 And then just very quickly you look at we have 0:18:22.920 --> 0:18:25.360 a big take story this morning talking about Hermes having 0:18:25.400 --> 0:18:29.400 delivered one thousand percent returns since they batted away LVMH. 0:18:29.920 --> 0:18:32.560 You know, do you feel confident at all in taking 0:18:32.600 --> 0:18:36.080 some of the higher, let's say, the premium names relative 0:18:36.160 --> 0:18:39.840 to Henny's a very European number. I'm learning as I 0:18:39.920 --> 0:18:41.200 go here in terms of what's big on the high 0:18:41.200 --> 0:18:43.639 street and anything. Are you so comfortable with taking any 0:18:43.680 --> 0:18:45.040 of the higher value luxury names. 0:18:45.119 --> 0:18:47.240 Yeah, I mean we do own Lululemon, and it looks 0:18:47.280 --> 0:18:49.639 to me like it turned around this morning when I 0:18:49.640 --> 0:18:53.080 was walking over here, and that's because they are a 0:18:53.119 --> 0:18:56.560 premium provider and they are delivered, they've delivered, and they're 0:18:56.600 --> 0:18:57.160 adding two. 0:18:57.160 --> 0:18:59.600 Already, one sixteen up sixteen bucks. 0:18:59.760 --> 0:19:00.560 Yeah, I'll take it. 0:19:00.600 --> 0:19:04.399 And then we own Nike, so that's another name in 0:19:04.440 --> 0:19:06.880 that space that you know, can be high with. 0:19:06.880 --> 0:19:09.000 Those, somewhat high end with those though, like again a 0:19:09.080 --> 0:19:12.960 somewhat high end definitely areas that are targeted to the 0:19:13.000 --> 0:19:15.200 younger generation, people who want to spend when you look 0:19:15.240 --> 0:19:16.800 at you, that is me. I know I don't want 0:19:16.800 --> 0:19:17.359 to for. 0:19:17.240 --> 0:19:20.480 People we're spending like crazy. 0:19:20.600 --> 0:19:22.200 I'm technically not a baby boomer yet. 0:19:22.280 --> 0:19:24.359 Go on, we've got about thirty seconds. But how are 0:19:24.400 --> 0:19:28.000 you thinking about kind of the strength of the consumer 0:19:28.080 --> 0:19:31.040 into twenty twenty four, just given how much the younger 0:19:31.119 --> 0:19:33.600