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Supreme Court to Hear TikTok Challenge · Bloomberg Intelligence

• 0:02
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  Speaker 3: Matt shutting home.
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  Speaker 1: He joins us here covers all the litigation for the media,
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  Speaker 1: telecoms space for Bloomberg Intelligence and Nathan Deane senior policy
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  Speaker 1: channels to Bloomberg Intelligence, both here in New York City. Matt,
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  Speaker 1: let's start with you. I was surprised to see that
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  Speaker 1: headline that the Supreme Court will hear the TikTok challenge
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  Speaker 1: to the US ban. Give us your thoughts.
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  Speaker 4: This is amazingly fast for the US Supreme Court. At
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  Speaker 4: this point, only TikTok had filed a single brief, just
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  Speaker 4: filing an application. Usually there's a process before the court
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  Speaker 4: grants review. None of that happened here. The Court immediately
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  Speaker 4: entered in order, saying, Okay, the deadline is January nineteenth.
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  Speaker 4: We'll hear argument nine days before that January tenth. We
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  Speaker 4: grant reviewed just on the stay, not just on the
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  Speaker 4: pause of the law. We grant review on the whole case.
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  Speaker 4: We're going to take this up, this big First Amendment question,
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  Speaker 4: first thing in January.
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  Speaker 5: So what do you make of that?
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  Speaker 3: I mean it's a good thing.
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  Speaker 4: I think it's a positive sign for TikTok that the
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  Speaker 4: superme why was it so fast?
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  Speaker 5: What does that tell us about something?
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  Speaker 4: I think the Supreme Court sees a very serious legal
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  Speaker 4: issue that needs to be resolved quickly. You have the
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  Speaker 4: President weighing in on this question and a deadline that's
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  Speaker 4: looming January nineteenth of whether the ban is going to
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  Speaker 4: take effect or not. So I think the Supreme Court
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  Speaker 4: said we need to take this, we need to take
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  Speaker 4: it fast. I don't think it necessarily means that TikTok
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  Speaker 4: will prevail, though. I continue to think TikTok probably has
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  Speaker 4: an uphill battle in persuading the justices that it's correct
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  Speaker 4: on the First Amendment. But at least we know TikTok
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  Speaker 4: will get the chance to present an oral argument.
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  Speaker 3: To the justices.
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  Speaker 1: Now in January, January tenth, they will present their argument.
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  Speaker 1: How long do you think the Supreme Court will take
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  Speaker 1: to then.
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  Speaker 3: Rule on it?
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  Speaker 4: Presumably before the nineteenth All of this is very unusual
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  Speaker 4: for the Supreme Court. We are in strange territory here,
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  Speaker 4: so I can't look at my statistics from all the
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  Speaker 4: other cases. I do think the Court is going to
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  Speaker 4: try to address this by January nineteenth. What they could
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  Speaker 4: do is say, look, will lease you an administrative stay
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  Speaker 4: to delay that January nineteenth deadline until we rule. But
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  Speaker 4: I wouldn't expect a major delay on that front. I
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  Speaker 4: think I think the Court will try to resolve this
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  Speaker 4: close to the January nineteenth deadline.
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  Speaker 6: Wow, I don't think I've ever ever heard of this
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  Speaker 6: for a court that moves quickly, that's Supreme This is.
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  Speaker 7: Like truly shocking.
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  Speaker 6: It's unfair question, but like what's your best guess, like
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  Speaker 6: knowing who's on the court, where they think, and how
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  Speaker 6: they think about the First Amendment.
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  Speaker 4: Yeah, So I continue to think TikTok faces an uphill
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  Speaker 4: battle with this Supreme Court when you look at how
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  Speaker 4: the DC Circuit decided this on a unanimous basis, where
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  Speaker 4: two of the three judges were Republican appointed, and now
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  Speaker 4: you take that same decision to this Supreme Court. This
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  Speaker 4: Supreme Court tends to nod its head in agreement with
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  Speaker 4: the rulings of Naomi Rau and Douglas Ginsburg who decided
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  Speaker 4: this case in overwhelming fashion against TikTok. So does it
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  Speaker 4: mean TikTok has an impossible case? No, there's a chance
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  Speaker 4: it could prevail here. This is a novel First Amendment question.
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  Speaker 4: Lots of ways for the Supreme Court to rule for TikTok,
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  Speaker 4: but I think it's uphill for TikTok. I think most
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  Speaker 4: likely the Supreme Court says, you know what, the d
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  Speaker 4: C Circuit got it right.
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  Speaker 3: Yep.
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  Speaker 1: All right, Matt, thank you so much for coming in
• 3:39
  Speaker 1: the last second here on this breaking news Matt Shelton
• 3:42
  Speaker 1: Helmy covers all the litigation across the Median telecommon industry,
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  Speaker 1: which is a highly regulated set of industries.
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  Speaker 6: All right, it's D Day, so therefore we have the
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  Speaker 6: expert on to give her take on what's going to happen.
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  Speaker 6: Danielle de Martino Booth, the CEO and chief strategistict QI Research,
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  Speaker 6: and she joins us now live.
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  Speaker 5: All right, so what are the key points that you're
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  Speaker 5: looking for?
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  Speaker 8: So I'm going to be looking to see how measured
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  Speaker 8: Powell's comments are and how enthusiastic or not he is
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  Speaker 8: about the economy. I'm not so sure that we're going
• 4:30
  Speaker 8: to see as much bravado as.
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  Speaker 7: We've seen lately.
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  Speaker 8: The last time he was at the podium preceded the
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  Speaker 8: latest release of the quarterly Senses of Employment in Wages,
• 4:40
  Speaker 8: which took down wage growth quite a bit. The last
• 4:44
  Speaker 8: time we made a dot plot in September, Powells said
• 4:46
  Speaker 8: the Fed is mentally adjusting payroll numbers.
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  Speaker 7: Based on QCW.
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  Speaker 8: I'm reading at Bloomberg headline there, and now we know
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  Speaker 8: from the Philadelphia Fed after they crunched through the numbers
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  Speaker 8: just degrees with Anna Wong's analysis, actually that pay losses
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  Speaker 8: started in the second quarter of twenty twenty four.
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  Speaker 7: We're in the weeds here. This is kind of our
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  Speaker 7: cane stuff.
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  Speaker 8: However, if the FED is going to be attentive to
• 5:12
  Speaker 8: what the Cleveland Fed is presenting, they expect shelter inflation
• 5:15
  Speaker 8: to decline from five percent. That process has already begun
• 5:18
  Speaker 8: to two percent year over year by the end of
• 5:20
  Speaker 8: twenty twenty five. If you pile on the fact that
• 5:23
  Speaker 8: it looks like payroll losses began in the second quarter
• 5:27
  Speaker 8: of twenty twenty four, these are elements that are going
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  Speaker 8: to have been incorporated into many, many presentations around that
• 5:37
  Speaker 8: big oval table in the Echos building. These aren't things
• 5:40
  Speaker 8: that they can ignore. And economists, lifelong economists, they're used
• 5:45
  Speaker 8: to having to look into the rear view mirror. It
• 5:47
  Speaker 8: was five quarters before we knew that the first quarter
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  Speaker 8: of two thousand and one or the first quarter of
• 5:52
  Speaker 8: two thousand and eight were actually negative GDP prints.
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  Speaker 7: The GDP is the last to reflect these.
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  Speaker 8: But if we know we're losing jobs as of April
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  Speaker 8: of twenty twenty for the fed's talking about it.
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  Speaker 1: So that would suggest to me your commentary that you
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  Speaker 1: would think the Fed would be cutting into twenty twenty five,
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  Speaker 1: because I think the market's been moving away from that.
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  Speaker 3: A little bit.
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  Speaker 7: The market has been moving away.
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  Speaker 8: Bond traders have been moving in the opposite direction as
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  Speaker 8: Bloomberg's been reporting here over the last twenty four hours
• 6:15
  Speaker 8: or so, And I think that he is going I
• 6:19
  Speaker 8: think Powell is going to really lean on we are
• 6:23
  Speaker 8: data dependent. Even with the positive revisions that we saw
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  Speaker 8: come out of the latest non farm pay report, we
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  Speaker 8: still had private job losses in the month of October,
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  Speaker 8: despite the comeback that we saw after the Boeing strike.
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  Speaker 8: Of course, those Boeing workers are all being let go
• 6:40
  Speaker 8: in the first quarter. We're seeing the same thing from
• 6:42
  Speaker 8: Stilantis and a lot of blood letting coming out of
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  Speaker 8: the manufacturing sector that really has yet to let up.
• 6:50
  Speaker 7: We saw backlogs.
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  Speaker 8: In S and P Global manufacturing in disees really fall
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  Speaker 8: to their lowest level. Backlogs their a gauge of future demand.
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  Speaker 8: That means that there's going to be more layoffs in.
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  Speaker 7: The coming year.
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  Speaker 8: The industrial recession is definitely starting to bleed into the
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  Speaker 8: service's economy. We saw that with yesterday morning's New York
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  Speaker 8: Services survey.
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  Speaker 5: Sir, I thought the services were really good.
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  Speaker 8: What I'm missing the headline SMP Global Services was good,
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  Speaker 8: but if you look again, I refer back to the QCEW.
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  Speaker 8: What SMP Global does not include in their services, which
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  Speaker 8: is what ISM does, is construction, retail, mining, and wholesale
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  Speaker 8: sales so once you cut those four critical cyclical sectors out,
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  Speaker 8: you understand that you really are looking at apples and
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  Speaker 8: oranges when you compare SMP Global.
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  Speaker 7: Services to the United States.
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  Speaker 8: To what ism is, which is a much more holistic read,
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  Speaker 8: and it's been appreciably weaker, especially.
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  Speaker 7: On that employment side.
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  Speaker 8: But again, where have we seen weakness in services? That
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  Speaker 8: would be construction, that would be retail.
• 7:56
  Speaker 1: Dot pots, we get some dots, dock dots go for
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  Speaker 1: Bloomberg terminal users out there. I can see where the
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  Speaker 1: dot pots, the dots are actually plotting out over the
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  Speaker 1: next several periods. What should we look for there?
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  Speaker 8: Well, I'll be looking for whether or not we're going
• 8:11
  Speaker 8: to stay at an anticipated potential for rate cuts in
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  Speaker 8: twenty twenty five.
• 8:17
  Speaker 7: Of course, the question is going.
• 8:18
  Speaker 8: To be or there's going to be front loaded or
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  Speaker 8: are they going to be trickled out across the year
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  Speaker 8: one per every meeting with the summary of economic projections,
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  Speaker 8: or will we see something possibly by January twenty ninth.
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  Speaker 6: What I'm trying to understand is what would be a
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  Speaker 6: good result for the market, so and how do we
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  Speaker 6: categorize that? So like what decision today or what dot
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  Speaker 6: plot gives us. I don't know a higher equity market
• 8:41
  Speaker 6: gives us lower yields.
• 8:43
  Speaker 5: If we call that a win.
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  Speaker 8: I don't know that we necessarily call it a win
• 8:47
  Speaker 8: if we walk away after Powell's pressed this afternoon and say,
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  Speaker 8: maybe they are.
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  Speaker 7: Going to be lowering rates at the end of January.
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  Speaker 6: So it's a kind of like, oh, data is not
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  Speaker 6: so great. Therefore they're actually going to have to cut
• 8:57
  Speaker 6: more than now we were thinking. So it's like a
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  Speaker 6: catch twenty Now it pretty.
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  Speaker 8: Much is what the market has priced in is all
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  Speaker 8: of a sixteen percent probability for that for another twenty
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  Speaker 8: five basis point.
• 9:07
  Speaker 7: Cut at the end of January.
• 9:10
  Speaker 8: I think to the extent that Powell is reticent to
• 9:13
  Speaker 8: talk about things like tariffs, things like the national debt, which.
• 9:16
  Speaker 7: He has not wanted, he wanted he won't.
• 9:20
  Speaker 8: But given the twenty eighteen twenty nineteen playbook, we know
• 9:23
  Speaker 8: that that inflation didn't show up for a good twelve months,
• 9:27
  Speaker 8: and that incoming Treasury Secretary Scott Bessentt has said he
• 9:31
  Speaker 8: wants to go more slowly than the first than Trump
• 9:35
  Speaker 8: one point oh tariffs in terms of how they're pushed
• 9:39
  Speaker 8: into the economy There's so.
• 9:41
  Speaker 7: Many things that remain to be seen, and you.
• 9:44
  Speaker 8: Can never tell whether or not it's bestent we can
• 9:48
  Speaker 8: take for his word or not, because you just need
• 9:50
  Speaker 8: a hot mic, you know, and a Trump.
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  Speaker 1: Yeah, that's how it could go. Daniel, thank you so
• 9:55
  Speaker 1: much for joining us. Daniel di Martino Booth, she's the
• 9:58
  Speaker 1: CEO and chief strategist at QI Research. Joining us here
• 10:02
  Speaker 1: in our Bloomberg Inarrector Brokers TD.
• 10:05
  Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
• 10:09
  Speaker 2: weekdays at ten am Eastern on Apple Car playing Android
• 10:12
  Speaker 2: Auto with the Bloomberg Business app, Listen on demand wherever
• 10:15
  Speaker 2: you get your podcasts, or watch us live on YouTube.
• 10:20
  Speaker 6: There's a ton of car news, so we wanted to
• 10:21
  Speaker 6: dive into that a little bit more. We just had
• 10:23
  Speaker 6: a headline the Cross that California gas car ban actually
• 10:27
  Speaker 6: wins Biden's blessing, which really sets California up in a
• 10:30
  Speaker 6: clash with President alike Donald Trump. California has rules that
• 10:35
  Speaker 6: require the sale of zero mission vehicles and ultimately ban
• 10:38
  Speaker 6: the sale of ice cars by twenty thirty five. At
• 10:41
  Speaker 6: the same time, we've a possible tie up from Honda
• 10:44
  Speaker 6: and Nissan, a tremendous earthquake that we heard really throughout
• 10:48
  Speaker 6: the auto industry. Steve Man is Bloomberg Intelligence Senior autos analyst. Hey, Steve,
• 10:52
  Speaker 6: let's just start with the Nissan Honda news. What's your biggest.
• 10:55
  Speaker 5: Takeaway on this?
• 10:57
  Speaker 9: Wow, I'm not too surprised that this is happening, you know,
• 11:01
  Speaker 9: given the seismic shifts in the auto industry in the
• 11:05
  Speaker 9: last five years, with you know, these startups Tesla, Riva
• 11:09
  Speaker 9: and Lucik coming on board here locally in the US
• 11:13
  Speaker 9: and globally, and then you have you know, the eight
• 11:15
  Speaker 9: hundred pound gorilla, the Chinese automakers, you know, really growing fast,
• 11:20
  Speaker 9: not just in their own markets but globally. So you know,
• 11:24
  Speaker 9: it's it's posing a lot of challenges to legacy automaker
• 11:28
  Speaker 9: and somebody like Nissan, which saw sales on a global level,
• 11:32
  Speaker 9: you know, drop as much as fifty percent over the
• 11:35
  Speaker 9: past five to six years. Uh, they're going to have
• 11:38
  Speaker 9: to do something to kind of pair costs down.
• 11:41
  Speaker 1: Would this be enough, Steve, for the combined company to
• 11:43
  Speaker 1: compete on a global scale.
• 11:46
  Speaker 3: It's it's tough to say.
• 11:49
  Speaker 9: I think initial thought is no, because you know, Nissan
• 11:54
  Speaker 9: over the past few years have really cut back the
• 11:58
  Speaker 9: number of models in the market place. They are over capacitized.
• 12:02
  Speaker 9: There's a lot of work that needs to be done.
• 12:05
  Speaker 9: So I'm not sure if it really helps Honda UH
• 12:09
  Speaker 9: in this type of merger. You know, I think the
• 12:11
  Speaker 9: till is towards you know, it could be a drag
• 12:14
  Speaker 9: to Honda.
• 12:15
  Speaker 6: Well, that was my question, is that I was reading
• 12:17
  Speaker 6: that there might not be a ton of synergies in
• 12:19
  Speaker 6: this that it's just really all about scale. So can
• 12:22
  Speaker 6: this scale be enough to offset that lack of synergy?
• 12:25
  Speaker 9: Well, I think that's the UH. I think that's it's
• 12:29
  Speaker 9: going to be the ongoing trend, and every automaker and
• 12:32
  Speaker 9: supplier as well will have to kind of revisit their
• 12:36
  Speaker 9: long term strategy because, you know, you were saying earlier
• 12:40
  Speaker 9: California is actually moving away or more moving towards all electric.
• 12:45
  Speaker 9: You know, automakers and suppliers are continuably being face or
• 12:49
  Speaker 9: facing you know, increasing R and D expenditure. As the
• 12:53
  Speaker 9: propulsion investment diversifies away from gas and more towards other
• 13:00
  Speaker 9: other powertrain system that's gonna be really costly for the
• 13:04
  Speaker 9: automakers and the suppliers.
• 13:07
  Speaker 5: So they're going to have.
• 13:08
  Speaker 9: To revisit how they're gonna, you know, and make those
• 13:12
  Speaker 9: investments going forward.
• 13:15
  Speaker 1: Stee, how much do the Japanese awnomakers have to compete
• 13:18
  Speaker 1: against China? It just feels like it would be more
• 13:21
  Speaker 1: than maybe the US awnmakers do.
• 13:23
  Speaker 9: I think so because if you look at the Japanese automakers,
• 13:27
  Speaker 9: they're really prevalent in emerging markets. Toyota is all of
• 13:30
  Speaker 9: the place, Honda and Nissan as well, They really those cars.
• 13:35
  Speaker 9: Japanese cars were considered low costs, so they resonate within
• 13:40
  Speaker 9: emerging markets. And that's where the Chinese automakers are actually entering.
• 13:45
  Speaker 9: The smaller markets in South America, Southeast Asia, Eastern Europe
• 13:49
  Speaker 9: really challenging head to head with the Japanese automakers as
• 13:54
  Speaker 9: well as the South Korean automakers.
• 13:57
  Speaker 6: Really good stuff, Steve. There's just so much to break
• 13:59
  Speaker 6: down through all of this. Appreciate it. Steve Man joining
• 14:01
  Speaker 6: US senior aunors reporter for Bloomberg Intelligence.
• 14:04
  Speaker 5: I should say analysts, not reporter.
• 14:06
  Speaker 7: My bad.
• 14:06
  Speaker 6: And there's the foxcom thing like Boss come aunts in
• 14:09
  Speaker 6: it's so confusing.
• 14:10
  Speaker 1: Well, think about Japan, which I learned early in my career,
• 14:12
  Speaker 1: is there's a lot of cross investment between companies that
• 14:15
  Speaker 1: you know, if they're out of industry, just different. I
• 14:17
  Speaker 1: think it's just I can't remember the reason for it
• 14:19
  Speaker 1: other than we're all in it together, and let's have
• 14:23
  Speaker 1: close relationships between.
• 14:25
  Speaker 3: Companies and management teams, and you know that type of.
• 14:29
  Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
• 14:33
  Speaker 2: weekdays at ten am Eastern on Apple Card playing Android
• 14:36
  Speaker 2: otto with the Bloomberg Business App. Listen on demand wherever
• 14:39
  Speaker 2: you get your podcasts, or watch us live on YouTube.
• 14:43
  Speaker 6: All right, joining us the man He is fantastic. He
• 14:46
  Speaker 6: knows the things about everything, his opinions on everything, and
• 14:49
  Speaker 6: really good insight.
• 14:50
  Speaker 5: And he's the kind of guy where you only you
• 14:53
  Speaker 5: don't hear what he says.
• 14:54
  Speaker 6: Anywhere else, and that's really special in this kind of business. Peter,
• 14:57
  Speaker 6: Chair of Academy Securities, is joining us in studio. Peter,
• 15:01
  Speaker 6: how are you going to be reading the FED today
• 15:04
  Speaker 6: and then the market reaction to the Fed today? What's
• 15:06
  Speaker 6: going to be your takeaway come tomorrow?
• 15:08
  Speaker 10: You know, I'm really expecting a fairly hockey FED. I
• 15:11
  Speaker 10: think they are a little bit worried about the economy,
• 15:13
  Speaker 10: but it's not showing up in the data, so I
• 15:14
  Speaker 10: think they're going to have to come across. Hey, we're
• 15:16
  Speaker 10: potentially on hold. We've done one hundred bases points. Let's
• 15:18
  Speaker 10: see where this plays out. I think that will disappoint
• 15:21
  Speaker 10: the market a little bit, only because we are up
• 15:22
  Speaker 10: so high since the election. Everything's run. I think people
• 15:25
  Speaker 10: got very comfortable rates are coming down. I think that stops.
• 15:28
  Speaker 10: I think I'll be paying close attention to the summary
• 15:31
  Speaker 10: of economic projections are more likely the dot plot.
• 15:34
  Speaker 3: Where where do they take the terminal rate?
• 15:36
  Speaker 10: And does that move closer to four percent, which would
• 15:38
  Speaker 10: signal that, yes, they are very close to being done.
• 15:41
  Speaker 1: If the Fed is going to be slower than expected
• 15:43
  Speaker 1: in lowering rates, if not coming to a pause here
• 15:48
  Speaker 1: for maybe all of twenty twenty five, Can a stock
• 15:51
  Speaker 1: marker work in that environment?
• 15:52
  Speaker 3: I think so.
• 15:53
  Speaker 10: I think the stock market has really moved on to
• 15:55
  Speaker 10: what is Trump going to do? What's joje you going
• 15:57
  Speaker 10: to do? Where do we head from there? And I
• 15:59
  Speaker 10: think there's a lot of op I think, you know,
• 16:01
  Speaker 10: once you move past some of the fears about terrorists,
• 16:02
  Speaker 10: which I think people have kind of fallen into this
• 16:05
  Speaker 10: maybe a bit of a false sense of scurity right
• 16:06
  Speaker 10: now that they're negotiating points. I think this is really
• 16:09
  Speaker 10: going to be about can he do something about the
• 16:12
  Speaker 10: rules and regulations? Can we revisit twenty years of rules
• 16:14
  Speaker 10: and regulations that have been put in place when they
• 16:16
  Speaker 10: add the luxury of being the sole superpower and now
• 16:19
  Speaker 10: that we're really competing economically with China in the world,
• 16:22
  Speaker 10: do all those make sense? And you know, we've talked
• 16:25
  Speaker 10: more recently we went from drill baby drill to refine
• 16:28
  Speaker 10: baby refine, And I think the one thing this economy
• 16:30
  Speaker 10: really needs is to process rare Earth's critical minerals energy
• 16:34
  Speaker 10: products ourselves.
• 16:36
  Speaker 6: So to that point, do we need to rethink a
• 16:38
  Speaker 6: reaction function to the FED when we don't know what
• 16:41
  Speaker 6: those policies are going to be?
• 16:42
  Speaker 10: Yeah, so I think the Fed's actually the reaction is
• 16:44
  Speaker 10: probably going to be.
• 16:45
  Speaker 3: Fairly mooted one way or the other. Day, Like we'll
• 16:46
  Speaker 3: get a bit of movement.
• 16:47
  Speaker 6: We always take the bite anything that has to do
• 16:49
  Speaker 6: with DC, right, and.
• 16:50
  Speaker 3: He's going to you know, we have to wait and see.
• 16:52
  Speaker 10: And again, I think, as the last guests just point out,
• 16:54
  Speaker 10: we don't know what's actually going to get implemented day
• 16:56
  Speaker 10: one or day two or day three, what's going to
• 16:57
  Speaker 10: be a priority, what falls through the cracks. You know,
• 17:00
  Speaker 10: when I look at it, I think immigration. They're going
• 17:03
  Speaker 10: to go after some highly visible targets that probably most
• 17:05
  Speaker 10: people are in favor of. I think you've already seen
• 17:07
  Speaker 10: New York City Mayor Adams start talking down. So I've
• 17:09
  Speaker 10: always thought the Roosevelt Hotel, that type of situation is
• 17:12
  Speaker 10: going to be the first thing they crack down on.
• 17:14
  Speaker 10: But it's not going to bleed into this wholesale you know,
• 17:17
  Speaker 10: knocking on doors, kicking indoors, pulling out people and sending
• 17:19
  Speaker 10: them away from the country.
• 17:21
  Speaker 3: So I think that'll be fine.
• 17:22
  Speaker 10: I think in terms of energy, he's going to start
• 17:25
  Speaker 10: enforcing some of the sanctions against both Russia and Iran,
• 17:28
  Speaker 10: partly to force them to some sort of peace deal,
• 17:31
  Speaker 10: also to support our own energy industry, and from there,
• 17:33
  Speaker 10: we'll just see what he comes up.
• 17:35
  Speaker 1: When he comes up with, yeah, that'll be interesting. It
• 17:38
  Speaker 1: always is, those us in the news business.
• 17:39
  Speaker 3: Yeah, keeps us on our toes.
• 17:41
  Speaker 5: Okay, so what do you do? So what do you like?
• 17:43
  Speaker 6: So we're looking at the risk of higher yields over
• 17:45
  Speaker 6: next year. I'm reading between your lines. We're still talking
• 17:48
  Speaker 6: about that bad breath in the market and the leaders
• 17:50
  Speaker 6: from the Nasdaq one hundred, what do you do?
• 17:53
  Speaker 10: So I really like him, you know, they've been selling
• 17:54
  Speaker 10: off again, But I do like all the commodity players,
• 17:57
  Speaker 10: all the industries that enable commodity. I really think there's
• 18:00
  Speaker 10: going to be this massive push for some sort of
• 18:02
  Speaker 10: you know, let's call it security broadly, where we need
• 18:05
  Speaker 10: to produce and refine our own rare earth critical minerals
• 18:08
  Speaker 10: and energy. So I think we talked about energy. So
• 18:10
  Speaker 10: I don't think it's really going to be good for
• 18:11
  Speaker 10: the commodity prices because I think you're going to see
• 18:13
  Speaker 10: more supply come on. But I think you're going to
• 18:15
  Speaker 10: see these companies embrace it. I think you're going to
• 18:17
  Speaker 10: see a big push to create some regulatory, you know, opportunities.
• 18:21
  Speaker 10: And one thing one of our generals is really keen
• 18:23
  Speaker 10: to point out on he was very involved in Trump's
• 18:24
  Speaker 10: first negotiations with G on Terras, and Trump feels a
• 18:28
  Speaker 10: little bit cheated by G because G had promised to
• 18:30
  Speaker 10: buy a bunch of agricultural products.
• 18:32
  Speaker 3: And never followed through.
• 18:34
  Speaker 10: So if there is a deal this time, and I
• 18:35
  Speaker 10: assume there will be one, watch for AG to really benefit, right,
• 18:38
  Speaker 10: he is really going to force g to buy it
• 18:41
  Speaker 10: and deliver on that purchases this time.
• 18:43
  Speaker 3: So I think again that whole industry. So I look
• 18:45
  Speaker 3: at all.
• 18:45
  Speaker 10: The heavy equipment manufacturers. They should do really well in
• 18:48
  Speaker 10: that environment, and they still trade cheap, right AI. Some
• 18:51
  Speaker 10: of these others may do very well, but they trade
• 18:53
  Speaker 10: very expensive. This to me, it feels like it's going
• 18:56
  Speaker 10: to have to catch that momentum and you're gonna have
• 18:57
  Speaker 10: to get that inflow. But if you get those inflows,
• 18:59
  Speaker 10: there's a lot room for these stocks to run.
• 19:01
  Speaker 1: Just asking for a friend here, what do you think
• 19:03
  Speaker 1: about the energy space here? Because if we're drilling or
• 19:05
  Speaker 1: refining or whatever, I think that's good for the energy space,
• 19:09
  Speaker 1: but maybe it could not be.
• 19:10
  Speaker 3: Great for prices. That's it.
• 19:11
  Speaker 10: I think it's not going to be great for prices,
• 19:13
  Speaker 10: so that'll be a slight impediment to real growth. But
• 19:16
  Speaker 10: on the other hand, I think he's going to reopen
• 19:18
  Speaker 10: up our ability to export, right, He's going to create
• 19:20
  Speaker 10: these opportunities. So I think our companies will do very
• 19:23
  Speaker 10: well in this, and I think the energy stocks will
• 19:25
  Speaker 10: weigh outperform the commodity So I see an environment where
• 19:28
  Speaker 10: the commodity prices may be stable, slightly down, slightly up
• 19:30
  Speaker 10: depending on what goes on in terms of economic growth,
• 19:33
  Speaker 10: whereas the stocks can rally ten twenty thirty percent even
• 19:36
  Speaker 10: with that.
• 19:37
  Speaker 6: Yeah, and then to that point, I mean, that's kind
• 19:38
  Speaker 6: of what we saw today that the idea will actually
• 19:42
  Speaker 6: reporting from Bloomberg is the idea that they're going to
• 19:44
  Speaker 6: roll back the EV incentives, but they're going to put
• 19:46
  Speaker 6: more money and stuff in those one hundred days into
• 19:48
  Speaker 6: creating the nuts and bolts of how to make those
• 19:51
  Speaker 6: EV cars, like critical.
• 19:52
  Speaker 5: Minerals and stuff like that. So that's exactly to your point.
• 19:55
  Speaker 10: Yeah, And the one thing I think we all forget
• 19:57
  Speaker 10: I have to remind myself too, is producing and ref
• 20:00
  Speaker 10: finding commodities is commodity intensive. Right as we build this out,
• 20:02
  Speaker 10: you need steel, you need pipes, you need roads, so
• 20:06
  Speaker 10: it's all very commodity intensive. So that will support the
• 20:08
  Speaker 10: price of commodities as we build this out. And I
• 20:11
  Speaker 10: just don't see any reason Trump won't push for this.
• 20:13
  Speaker 10: I think it's good from a national security standpoint, and
• 20:15
  Speaker 10: it's the sort of thing he likes doing, right. He
• 20:17
  Speaker 10: loves cutting red tape. That's what he did, you know,
• 20:20
  Speaker 10: whether he's a businessman or more marketing. He loved cutting
• 20:22
  Speaker 10: red tape, So I think this is going to be
• 20:24
  Speaker 10: something that really appeals to him too, Musk, and it's
• 20:26
  Speaker 10: going to be relatively easy for him to get through
• 20:28
  Speaker 10: in many cases.
• 20:29
  Speaker 6: Also, this is like perfect from Usk, Like if you
• 20:31
  Speaker 6: create a factory that you can source all your critical
• 20:34
  Speaker 6: batteries for Tesla, cool, I mean that's what he's been
• 20:36
  Speaker 6: trying to do anyway when it comes to Tesla.
• 20:38
  Speaker 10: Yeah, and just even from a military standpoint, the amount
• 20:41
  Speaker 10: you know they had to rip out. I think a
• 20:42
  Speaker 10: lot of the wawey chips that were in our military equipment, right,
• 20:44
  Speaker 10: but some of the raw you know, the rarest critical
• 20:47
  Speaker 10: minerals will refined products are coming from China. Why the
• 20:50
  Speaker 10: person that we're having the most degree of friction and
• 20:52
  Speaker 10: potentially at most risk with down the road, you would
• 20:55
  Speaker 10: not be wanting anything that goes into your military equipment
• 20:57
  Speaker 10: being sourced primarily from there. So I think that's all
• 20:59
  Speaker 10: going to get changed, It's all going to get pushed.
• 21:01
  Speaker 10: And I think this time what I have liked is,
• 21:04
  Speaker 10: you know we're calling it Trump one point five. He's
• 21:05
  Speaker 10: hit the ground running, right, He's already effectively getting stuff
• 21:08
  Speaker 10: lined up to do, unlike the first time around, where
• 21:11
  Speaker 10: I think he was kind of a little bit deer
• 21:12
  Speaker 10: in headlights and didn't know what to do day one.
• 21:14
  Speaker 1: Do we have those rare earths in the minerals and
• 21:16
  Speaker 1: the stuff we need for electric bad? Do we even
• 21:18
  Speaker 1: have that here in the US? I thought there were
• 21:20
  Speaker 1: in other parts of the world.
• 21:22
  Speaker 3: There actually are a lot in the US.
• 21:23
  Speaker 10: So I think you're one of the as government's built
• 21:25
  Speaker 10: out someone we've got rid of the Bureau of Mines.
• 21:27
  Speaker 10: We have not been big at mining things.
• 21:29
  Speaker 8: You know.
• 21:30
  Speaker 10: One story we've heard that seems pretty interesting is where
• 21:32
  Speaker 10: there are a lot of is the fracking was done,
• 21:34
  Speaker 10: the water that stays in the ground has actually been
• 21:36
  Speaker 10: absorbing lithium, and so you can extract that water from
• 21:39
  Speaker 10: the evaporate and get lithium. And that's actually probably the
• 21:41
  Speaker 10: most efficient.
• 21:42
  Speaker 3: Way to do it.
• 21:43
  Speaker 10: So there are all these opportunities, but I do think
• 21:45
  Speaker 10: the big thing is going to be the refining. So
• 21:47
  Speaker 10: I think, to me, right, there are other places in
• 21:49
  Speaker 10: the world we can get the resources themselves from, but
• 21:52
  Speaker 10: how do you refine them. We have to take that
• 21:54
  Speaker 10: responsibility on ourselves, and I think the process has never
• 21:57
  Speaker 10: been green. But the reality is if you let China
• 21:59
  Speaker 10: do it all, it's not green. It's probably not even
• 22:01
  Speaker 10: as green as they say it is. So take that
• 22:03
  Speaker 10: responsibility on your own. Do it here, do it domestically.
• 22:06
  Speaker 10: So that's why I think I'm switching more and more
• 22:08
  Speaker 10: to refined baby refined, from drill baby drill, because it's
• 22:10
  Speaker 10: all going to be about the processing.
• 22:12
  Speaker 5: Yeah, so smart.
• 22:13
  Speaker 6: Also, remember we used to book Peter as the bond
• 22:15
  Speaker 6: guy and like, look at how far you've come, So
• 22:18
  Speaker 6: let's talk about bonds.
• 22:19
  Speaker 5: Though, what do you think we're going to see on
• 22:22
  Speaker 5: the tenure?
• 22:22
  Speaker 6: And I asked that because he ro price that we
• 22:24
  Speaker 6: could see five percent in the first quarter of next
• 22:26
  Speaker 6: year and then six percent next year.
• 22:27
  Speaker 5: You think you're going to get a hankish bed anyway, and.
• 22:30
  Speaker 6: There's going to be all this investment that we're talking
• 22:31
  Speaker 6: about and going through which could be lead to a
• 22:34
  Speaker 6: lot more and growth.
• 22:35
  Speaker 10: I'm not quite that bear, So I think we should
• 22:36
  Speaker 10: be around four forty to four sixty on tens. I think,
• 22:39
  Speaker 10: you know, post election, everyone got two barriers, so that
• 22:42
  Speaker 10: was an easy call. We got the retlacement back down
• 22:44
  Speaker 10: to you know, four fifteen. I've been baryed since then.
• 22:46
  Speaker 10: I want to see I think coming into year end
• 22:48
  Speaker 10: four forty four sixty, I think there's a much bigger
• 22:51
  Speaker 10: risk of a gap fifty bits higher than a gap
• 22:54
  Speaker 10: fifty bits lower. I think we've had those moves, and
• 22:56
  Speaker 10: I could see us getting a five.
• 22:57
  Speaker 3: Percent next year.
• 22:58
  Speaker 10: I struggle with six percent, and I just don't think
• 23:00
  Speaker 10: the economy is going to be that good. I think
• 23:02
  Speaker 10: enough people pile into duration at that five percent level.
• 23:05
  Speaker 10: So and we've kind of for the last two years
• 23:08
  Speaker 10: been making lower highs on yields. Every time we sell off.
• 23:10
  Speaker 10: It's not quite as bad as it was before. So
• 23:13
  Speaker 10: I think i'd probably unless something dramatically changes, I'd be
• 23:16
  Speaker 10: a big buyer of tens if we got to five.
• 23:18
  Speaker 1: Credit risks taking any credit risk out there.
• 23:21
  Speaker 10: Yeah, we've been slowing down. I thought credit was great,
• 23:23
  Speaker 10: we've loved it. Since June, I'm kind of more neutral
• 23:25
  Speaker 10: on it. Part of what I saw I think that
• 23:27
  Speaker 10: was really positive was a lot of banks and not
• 23:29
  Speaker 10: lent enough during these post Silicon Valley bank so they
• 23:32
  Speaker 10: were chasing money.
• 23:33
  Speaker 3: Private credit was.
• 23:34
  Speaker 10: Getting a lot of money, so all this was coming
• 23:36
  Speaker 10: into the markets. So I've liked credit, and I think
• 23:38
  Speaker 10: we're okay there. But I do think, you know, if
• 23:41
  Speaker 10: the economy slows a bit, some parts might do less bad.
• 23:44
  Speaker 10: A lot of thing was very dependent on getting you know,
• 23:46
  Speaker 10: lower floating rates. I don't think we're going to get
• 23:48
  Speaker 10: that to happen as much. So I'm like neutralish. I
• 23:50
  Speaker 10: don't see anything wrong with credit. The one thing I
• 23:53
  Speaker 10: will say is I find myself fighting with people on
• 23:55
  Speaker 10: high yield a lot. People keep pulling up these charts
• 23:57
  Speaker 10: of high yield bonds all look at how tight they are.
• 23:59
  Speaker 10: They're two right, and to me, the high old bond
• 24:01
  Speaker 10: market does not look anything like it did ten years ago.
• 24:04
  Speaker 10: So close your eyes when you pull up these long
• 24:06
  Speaker 10: data charts on the high yield market. It used to
• 24:08
  Speaker 10: be smaller companies, not well known. They're now it's a
• 24:11
  Speaker 10: much better market.
• 24:12
  Speaker 1: Yep, very good, Peter, another great performance. Thank you so much.
• 24:15
  Speaker 1: We appreciate it.
• 24:15
  Speaker 3: Peter Chair.
• 24:16
  Speaker 1: He's had a macro strategy at Academy Securities and Academy
• 24:19
  Speaker 1: Securities for those of you who don't know the founders
• 24:23
  Speaker 1: military so a lot of the leadership and the ownership
• 24:26
  Speaker 1: of Academy Securities is ex United States Military, So good
• 24:31
  Speaker 1: folks over there, and we appreciate getting some of Peter's time.
• 24:34
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• 24:42
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