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Banks, Housing, Markets, and UK CPI · Bloomberg Intelligence

• 0:00
  Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside
• 0:04
  Speaker 1: my co host Matt Miller.
• 0:05
  Speaker 2: Every business day, we bring you interviews from CEOs, market pros,
• 0:09
  Speaker 2: and Bloomberg experts, along with essential market moving news.
• 0:14
  Speaker 1: Find the Bloomberg Markets Podcast on Apple Podcasts or wherever
• 0:17
  Speaker 1: you listen to podcasts, and at Bloomberg dot com slash podcast.
• 0:20
  Speaker 3: Our great friends of Goldman Sachs kind of a tough quarter.
• 0:23
  Speaker 1: You know, I don't feel sorry for them because they
• 0:25
  Speaker 1: win a lot more than they don't. I competed against
• 0:28
  Speaker 1: them for many, many years, with some success, but always
• 0:31
  Speaker 1: always tough competitors everywhere you go. Somebody's also followed this
• 0:36
  Speaker 1: company for a long long time. Allison Williams Bloomberg Intelligence.
• 0:39
  Speaker 1: She's her senior banks analyst, and you know she's also
• 0:41
  Speaker 1: a suit. She's now management. She runs the US Bloomberg Intelligence.
• 0:45
  Speaker 1: So it's like, you know, now she's a suit, she's
• 0:48
  Speaker 1: a boss.
• 0:49
  Speaker 4: You're a boss now exactly you were a boss before
• 0:52
  Speaker 4: because I have tough.
• 0:54
  Speaker 1: So, you know, Allison, I don't know talk to us
• 0:56
  Speaker 1: about Goldman Sachs here. It feels like they kind of
• 0:59
  Speaker 1: got a little off track with that retail push and
• 1:01
  Speaker 1: maybe that took some attention away from some of their businesses. Yes,
• 1:05
  Speaker 1: it is a tough environment, but Goldman Sacks is still
• 1:08
  Speaker 1: Goldman Sacks.
• 1:08
  Speaker 5: Right they are, and you know you're seeing the other
• 1:12
  Speaker 5: side of holatility to some extent, right, So, I mean
• 1:15
  Speaker 5: the ro is very tough. This quarter includes a lot
• 1:18
  Speaker 5: of one timers, there's some charges, there's you know, they're
• 1:21
  Speaker 5: working towards a longer term strategy and I think they're
• 1:25
  Speaker 5: doing the right things. The alternative strategy. You're really showing
• 1:29
  Speaker 5: this quarter why that they're implementing that in terms of
• 1:32
  Speaker 5: moving to a model that's more focused on fees and
• 1:35
  Speaker 5: managing assets for clients versus taking the risks directly on
• 1:38
  Speaker 5: their balance sheet, which is something that regulators have wanted
• 1:40
  Speaker 5: them to move away from for a long time. So
• 1:43
  Speaker 5: they had that charge. They also had the charge related
• 1:47
  Speaker 5: to Green Sky offset by a little small gain related
• 1:52
  Speaker 5: to some sale Marcus Loans. I think, you know, moving
• 1:55
  Speaker 5: away from those businesses also strategically the right thing for
• 1:58
  Speaker 5: Goldman focused on want what you're good at. Unfortunately, it's
• 2:02
  Speaker 5: a tough quarter for the business. But equities trading up
• 2:05
  Speaker 5: one percent, I mean that's oppressive in this quarter, and
• 2:09
  Speaker 5: that's you know, that's a prime brokerage business, and that
• 2:11
  Speaker 5: shows that they're executing on what they do well.
• 2:14
  Speaker 4: So when it comes to the consumer business in Green Sky,
• 2:17
  Speaker 4: like you mentioned, is part of what we're seeing right
• 2:19
  Speaker 4: now with Goldman, just some pain that they have to
• 2:22
  Speaker 4: go through to kind of have this transition out of
• 2:25
  Speaker 4: and away from those two things.
• 2:27
  Speaker 5: Yeah, I mean general, when you shift strategy and do
• 2:29
  Speaker 5: some kind of restructuring, you know, first of all, it's
• 2:32
  Speaker 5: never in a straight line, and there's always charges before
• 2:36
  Speaker 5: you sort of move on to the better stuff. Because
• 2:38
  Speaker 5: they were performing well, you probably are were not businesses
• 2:41
  Speaker 5: that you're getting rid of, and so it's tough for
• 2:45
  Speaker 5: them to take the impairment and shows that that was
• 2:48
  Speaker 5: not an asset purchase. Well, but I think that on
• 2:53
  Speaker 5: the cost side of things, if we strip out these costs,
• 2:59
  Speaker 5: there's stills a little bit more work to do. So
• 3:01
  Speaker 5: they do you know, they want to get to a
• 3:03
  Speaker 5: sixty percent cost ratio over the cycle. They're at about
• 3:05
  Speaker 5: seventy percent once you make all the adjustments. So part
• 3:09
  Speaker 5: of that is the tougher part of the cycle. So
• 3:13
  Speaker 5: I talked about equity trading which was a real positive fix.
• 3:16
  Speaker 5: Trading was weak as expected. You know, Goldman and Morgan
• 3:20
  Speaker 5: Stanley especially you're seeing big declines because they had such
• 3:24
  Speaker 5: good quarters a year ago due to commodities. And on
• 3:27
  Speaker 5: the banking side, Goldman is the m and a revenue leader,
• 3:32
  Speaker 5: as you know Paul from competing with them in the past.
• 3:35
  Speaker 5: That so they you know, the league tables move around,
• 3:38
  Speaker 5: but that's a big chunk for them, and that's just
• 3:43
  Speaker 5: going the wrong way right now for the industry. We're
• 3:45
  Speaker 5: hearing a lot of constructive comments about the pick up there,
• 3:50
  Speaker 5: and you know you've also mentioned from some folks, you know,
• 3:54
  Speaker 5: hearing some positive comments, but those are really not going
• 3:56
  Speaker 5: to play out in the second half. That's a twenty
• 3:58
  Speaker 5: twenty four story.
• 3:59
  Speaker 6: All right.
• 3:59
  Speaker 1: Let's step back and just talk regulation, not so much
• 4:02
  Speaker 1: for for Goldman per se, but just for the banks,
• 4:04
  Speaker 1: all right. Post financial crisis, a lot of new regulations
• 4:07
  Speaker 1: came on in the industry.
• 4:07
  Speaker 3: Fine, we get it.
• 4:09
  Speaker 1: There had to be some response and probably well deserved regulations,
• 4:13
  Speaker 1: I would have thought, and over time a lot of
• 4:15
  Speaker 1: those regulations would just kind of fall to the wayside,
• 4:17
  Speaker 1: peel back. But now the discussion is actually even for
• 4:20
  Speaker 1: more regulations. What is driving that that need for more
• 4:24
  Speaker 1: regulation of the banks? I know Jamie Diamond's been a
• 4:26
  Speaker 1: big spokesperson kind of against that with along with Brian
• 4:29
  Speaker 1: morning Hand.
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  Speaker 5: So there's two things, you know, first, which is on
• 4:34
  Speaker 5: you know the quote smaller banks, but you know, not
• 4:36
  Speaker 5: the not the biggest banks that I cover. Right, So
• 4:39
  Speaker 5: we had the issues in March that did raise a
• 4:41
  Speaker 5: lot of questions of you know, some of the things
• 4:43
  Speaker 5: that were rolled back, Okay, should they have been? And
• 4:46
  Speaker 5: so I think that sort of, you know, to your point,
• 4:49
  Speaker 5: things started to roll back, but now the question was
• 4:51
  Speaker 5: like was that the right thing to do. The second
• 4:54
  Speaker 5: part that's more germane to the banks that I cover,
• 4:57
  Speaker 5: which is Basil three endgame, which we hope is finally
• 4:59
  Speaker 5: the end. So again we've had all these regulations over
• 5:03
  Speaker 5: the years. You know, there's some some still finalization that
• 5:08
  Speaker 5: we're expecting any day now for the last few weeks.
• 5:12
  Speaker 5: And I think that why you're hearing the bank management's
• 5:17
  Speaker 5: complain is that you know, first of all, the way
• 5:19
  Speaker 5: that the basil works, because you hear this term a lot, right,
• 5:22
  Speaker 5: So Basil is really an entity that sort of sets
• 5:25
  Speaker 5: the guidelines and then the jurisdictions go out and implement those.
• 5:29
  Speaker 5: So the US has a lot of other very strict
• 5:32
  Speaker 5: regulations that other countries don't have. Right, so we have
• 5:35
  Speaker 5: the stress test every year. That adds a lot of volatility,
• 5:39
  Speaker 5: and that really is very punitive to the trading books
• 5:42
  Speaker 5: of banks. This buzzle three endgame, again supposedly from what
• 5:47
  Speaker 5: we've heard from the proposal outlines, is also going to
• 5:50
  Speaker 5: be tough on the trading books of banks. So do
• 5:53
  Speaker 5: you really need to have this sort of double whammy
• 5:55
  Speaker 5: and these different types of conflicting regulations that you know,
• 5:59
  Speaker 5: really make it very difficult. And I think you know
• 6:01
  Speaker 5: what the bank managements will say is you might make
• 6:04
  Speaker 5: the banks safer, but the risks will still be there
• 6:07
  Speaker 5: and they'll be outside of the system.
• 6:09
  Speaker 7: Ye.
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  Speaker 5: And is that really what you want?
• 6:11
  Speaker 1: Unintended consequence, because that goes too just to the business
• 6:14
  Speaker 1: at Maddie and I talked to talk about a lot,
• 6:16
  Speaker 1: which is the private credit business.
• 6:18
  Speaker 3: And these private creditors come in with almost these Cheshire smiles.
• 6:22
  Speaker 1: You know, they're like, I can't believe how good it
• 6:24
  Speaker 1: is for us now because the banks have so much
• 6:26
  Speaker 1: regulation that they're reluctant to put some of these loans
• 6:28
  Speaker 1: on their books, and so the barers, big private equity
• 6:32
  Speaker 1: shops are coming to us and we're making money handover
• 6:35
  Speaker 1: faced here.
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  Speaker 5: And if you look at if you looked at a
• 6:37
  Speaker 5: very long term chart of banks, you know since the crisis,
• 6:41
  Speaker 5: you will see the huge growth of credit in the
• 6:44
  Speaker 5: non bank center, shadow bank, whatever you want to call it,
• 6:47
  Speaker 5: private credit is that is certainly a huge player there.
• 6:51
  Speaker 5: And then the decrease on banks balance sheets. But again
• 6:55
  Speaker 5: like these private credit firms are getting there. You know,
• 6:57
  Speaker 5: they're raising capital, you know, from someone, And if you
• 7:01
  Speaker 5: think about it, the private private credit is really sort
• 7:04
  Speaker 5: of the talk of the entire asset management industry, even
• 7:08
  Speaker 5: the traditional managers buying into private credit, the private equity
• 7:12
  Speaker 5: managers building up their private credit businesses. So you have
• 7:15
  Speaker 5: all this money going there.
• 7:16
  Speaker 3: There's more talk.
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  Speaker 5: About getting this into pension portfolios and other portfolios. So
• 7:20
  Speaker 5: you can think about, you know, sort of wear the
• 7:22
  Speaker 5: risks and who's going to bear those risks and how
• 7:24
  Speaker 5: that's all shaping up.
• 7:25
  Speaker 3: Thinking about going into the private credit.
• 7:27
  Speaker 1: See I went through thesemen bank, the Chase Manhattan Bank
• 7:30
  Speaker 1: credit training, which is the best on Wall Street. Back
• 7:34
  Speaker 1: back in the day, I can take those skills and
• 7:35
  Speaker 1: go to private credit.
• 7:36
  Speaker 8: There you go.
• 7:37
  Speaker 4: I should have done it. I mean, there's still time
• 7:39
  Speaker 4: for me, you guys, I can get an MBA tomorrow. Allison.
• 7:42
  Speaker 4: I want to ask you a weird one in our
• 7:44
  Speaker 4: final minute and a half with you. A lot of
• 7:46
  Speaker 4: my friends got the Apple savings card with the Goldman.
• 7:50
  Speaker 4: What do I need to tell them? Are they gonna
• 7:52
  Speaker 4: get ditched by Goldman any day?
• 7:54
  Speaker 8: Now?
• 7:54
  Speaker 5: What's going on with I mean, they they probably don't
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  Speaker 5: even know that Goldman's evolved, and except that you probably
• 7:59
  Speaker 5: told them that, and that's why those cards are those
• 8:02
  Speaker 5: cards are generally.
• 8:03
  Speaker 3: Called private label.
• 8:05
  Speaker 5: So what Goldman had said right was that they were
• 8:08
  Speaker 5: getting away from Marcus. They did keep the GM relationship,
• 8:11
  Speaker 5: the Apple relationship, where there's some kind of a relationship,
• 8:14
  Speaker 5: but in general, when those relationships fall apart, it's it
• 8:18
  Speaker 5: tends to be because the economics just aren't working for
• 8:22
  Speaker 5: one or someone else is coming in and willing to
• 8:25
  Speaker 5: accept lower economics. So, you know, and of course we
• 8:29
  Speaker 5: never know that, We never know that. Most of us
• 8:32
  Speaker 5: never know exactly what happens. But you know, that could
• 8:34
  Speaker 5: be the case that someone's coming in and just you know,
• 8:37
  Speaker 5: more interested in the credit card business, and now that
• 8:40
  Speaker 5: it's not so strategically important for Goldman, you know, will
• 8:43
  Speaker 5: they be willing to sort of give that away? And
• 8:46
  Speaker 5: it's it's also been interesting, right So the other side
• 8:48
  Speaker 5: of it is the deposit gathering business, and you see
• 8:51
  Speaker 5: Apples introducing this new product, but then you have the
• 8:54
  Speaker 5: Marcus product and you see the yields on both of
• 8:56
  Speaker 5: those and kind of competing, and you know where we're
• 9:00
  Speaker 5: you know, Goldman liked those. They obviously would like to
• 9:02
  Speaker 5: get one hundred percent of the economics where they.
• 9:04
  Speaker 1: Can, right, Okay, all right, Alison, thanks so much for
• 9:07
  Speaker 1: joining us. I know there's a busy, busy few days
• 9:09
  Speaker 1: for you.
• 9:09
  Speaker 3: Alison Williams.
• 9:10
  Speaker 1: She covers all the banks on a global basis for
• 9:12
  Speaker 1: Bloomberg Intelligence. She's also the director of research for the
• 9:15
  Speaker 1: US business for Bloomberg Intelligence, so we appreciate getting some
• 9:18
  Speaker 1: of her time here in the Bloomberg Interactive Brokers Studio.
• 9:22
  Speaker 9: You're listening to the Team Ken's are Live program Bloomberg
• 9:26
  Speaker 9: Markets weekdays at ten am Eastern on Bloomberg dot com,
• 9:29
  Speaker 9: the iHeartRadio app, and the Bloomberg Business app, or listen
• 9:33
  Speaker 9: on demand wherever you get your podcasts, Madison.
• 9:37
  Speaker 1: When I bought the Jersey Shore Compound earlier this year,
• 9:40
  Speaker 1: my mortgage had a six handle on it, and I
• 9:43
  Speaker 1: was not happy.
• 9:45
  Speaker 3: Just got rooked at because I know Matt.
• 9:46
  Speaker 1: Millers is I think sub three on his estate up
• 9:49
  Speaker 1: in Westchester. But I'm looking at the bankrate dot com
• 9:53
  Speaker 1: US home mortgage thirty year fixed national average today seven point,
• 9:58
  Speaker 1: So maybe I'm not that dumb of a buyer. But
• 10:00
  Speaker 1: any who, where are mortgage rates going? What's going on
• 10:03
  Speaker 1: in that market? I have no idea other than we'd
• 10:06
  Speaker 1: call Erica Adelberg. She's an MBS strategist that's mortgage backed
• 10:10
  Speaker 1: securities for you out there for Bloomberg Intelligence. She joins
• 10:13
  Speaker 1: us here in our Bloomberg Interactive Brokers studio. So, Erica,
• 10:16
  Speaker 1: how are mortgage backed securities? How's the market in twenty
• 10:20
  Speaker 1: twenty three so far you're to date?
• 10:23
  Speaker 8: Hi, thanks for having me on. The market is actually
• 10:28
  Speaker 8: just barely up, I think on an excess return basis,
• 10:33
  Speaker 8: and it's we actually have great rates are up one
• 10:36
  Speaker 8: hundred as you pointed out, they're up about one hundred
• 10:38
  Speaker 8: basis points in terms of primary mortgage rates year every year.
• 10:43
  Speaker 8: But they are off their recent peaks, so at least
• 10:45
  Speaker 8: you didn't take out a seven point three five percent
• 10:48
  Speaker 8: mortgage last week or so. As you know, they ratesed,
• 10:53
  Speaker 8: you know, fled higher once again when non fine pay
• 10:57
  Speaker 8: rolls came in a little stronger than some people had
• 10:59
  Speaker 8: hoped her expected. But there has been some retreat in
• 11:02
  Speaker 8: that again with CPI coming in a little bit lower.
• 11:05
  Speaker 8: So you know, we're still closer to the hives than
• 11:09
  Speaker 8: the lows, but you know, we are off the tippy top.
• 11:13
  Speaker 8: But anytime you have mortgage rates around or above seven percent,
• 11:17
  Speaker 8: it probably is restrictive on an affordability basis for quite
• 11:21
  Speaker 8: a few people.
• 11:22
  Speaker 4: Yeah, well, it's really interesting. I know that you know
• 11:24
  Speaker 4: all about this, but this Redfin report was fascinating to
• 11:28
  Speaker 4: me showing that just one percent of the nation's homes
• 11:30
  Speaker 4: have changed hands this year. And they also have data
• 11:33
  Speaker 4: showing the ninety percent of Americans do have a mortgage
• 11:36
  Speaker 4: under six percent. So why would anyone ever be incentivized
• 11:40
  Speaker 4: to let that go when, like you said, Paul, now
• 11:43
  Speaker 4: we're at the seven handle. What could be the catalyst
• 11:47
  Speaker 4: for people to start to say it's time to leave
• 11:51
  Speaker 4: behind my home and get a new mortgage.
• 11:53
  Speaker 8: I mean to state the obvious. Life happens. You know,
• 11:56
  Speaker 8: people have kids, you know, there's divorces, there's you know,
• 12:00
  Speaker 8: so over time and and I mean, if you look
• 12:02
  Speaker 8: at the very long range average, it's not like seven
• 12:06
  Speaker 8: percent is it's it's high, but you know, we've had
• 12:09
  Speaker 8: rates a lot higher. It seems like all of our
• 12:12
  Speaker 8: you know, older siblings or parents, depending on what generation
• 12:15
  Speaker 8: we're in, you know, at one point probably had rates
• 12:18
  Speaker 8: that were seven seven to ten percent or you know,
• 12:21
  Speaker 8: even higher. And of course all those people have now
• 12:24
  Speaker 8: refinanced two and a half percent if they still have mortgages.
• 12:28
  Speaker 4: But is that the move then for people listening? Just
• 12:31
  Speaker 4: if you are waiting to buy a home, don't wait,
• 12:34
  Speaker 4: just do it now in refinance.
• 12:36
  Speaker 8: That's that's certainly what a new homebuilder would tell you.
• 12:38
  Speaker 3: Yeah, and new.
• 12:39
  Speaker 8: Home builders are you know that That's that's really the
• 12:42
  Speaker 8: game in town right now, because as you just mentioned,
• 12:45
  Speaker 8: except for the people who do have to move for
• 12:46
  Speaker 8: one reason or another, very few people are listing their
• 12:49
  Speaker 8: their homes. You know, the numbers on listenings are extremely low.
• 12:52
  Speaker 8: So the resale market as they call it is, or
• 12:55
  Speaker 8: existing home market, is very slow. But new home builders,
• 12:59
  Speaker 8: as just alluded to, permits and starts, are up new
• 13:03
  Speaker 8: home sales. New home inventories are about a third of
• 13:06
  Speaker 8: existing homes of homes listed for sale these days, and
• 13:10
  Speaker 8: the new home builders are finding ways to incentivize first
• 13:16
  Speaker 8: time home buyers and you know, even some move up
• 13:18
  Speaker 8: buyers by offering them slightly lower rates. What's interesting, I
• 13:23
  Speaker 8: was reading just the other day that some of these buydowns,
• 13:25
  Speaker 8: as they call it, were relatively temporary. They offered like
• 13:28
  Speaker 8: a three two one buy down, where it's basically only
• 13:30
  Speaker 8: good for three years the first year they buy down
• 13:33
  Speaker 8: the rate for three years, then two, then one. They
• 13:35
  Speaker 8: have to qualify them at the higher mortgage rate, so
• 13:38
  Speaker 8: you know, unlikely to be another subprime teaser mortgage rate,
• 13:42
  Speaker 8: but it might become as a rate shock. Maybe some
• 13:44
  Speaker 8: people had expected, as you mentioned, rates to fall sooner
• 13:47
  Speaker 8: and to be able to refinance in that time, and
• 13:50
  Speaker 8: that's what the home builders are selling. They're like, you know,
• 13:52
  Speaker 8: for right now, we'll give you a lower rate because
• 13:54
  Speaker 8: surely you'll be able to refin in a year or two.
• 13:57
  Speaker 8: Some of those people certainly haven't been able to.
• 13:59
  Speaker 1: Yeah, I kind of thought I gave myself twelve months,
• 14:02
  Speaker 1: which I still plenty plan of time that i'd refinance
• 14:04
  Speaker 1: with a FOE handle, and I'm not sure that's going
• 14:07
  Speaker 1: to happen, but we'll see, but I will refinance a
• 14:09
  Speaker 1: low I'm not too concerned about that, all right, So
• 14:11
  Speaker 1: talk to us about Uh yeah, I think about office space,
• 14:15
  Speaker 1: and in some of the biggest cities there's so much
• 14:17
  Speaker 1: office space, and people are telling us that's going to
• 14:19
  Speaker 1: be a real problem for the lenders and so on
• 14:22
  Speaker 1: and so forth.
• 14:22
  Speaker 3: How does that impact your market, the mortgage backed securities market, I.
• 14:27
  Speaker 8: Think the actual office space. There's two ways that could
• 14:30
  Speaker 8: impact it. For one thing, as we've just mentioned, there
• 14:33
  Speaker 8: is a bit of a lack of availability of homes
• 14:36
  Speaker 8: for sale for those who do want to get into
• 14:38
  Speaker 8: the market. You know, the new home builders are picking up,
• 14:42
  Speaker 8: but actually if you look at the charts of permits
• 14:44
  Speaker 8: and starts, we're a lot higher than we were in
• 14:47
  Speaker 8: pre pandemic levels. But that's because there had been ten
• 14:50
  Speaker 8: years post financial crisis of underbuilding. So there's a big
• 14:54
  Speaker 8: troth after two thousand and nine two thousand and eight,
• 14:57
  Speaker 8: and it was just creeping slowly up and then shot
• 15:00
  Speaker 8: up during the pandemic. So we're about twenty percent below
• 15:05
  Speaker 8: pandemic levels. We're well above that we were in the
• 15:07
  Speaker 8: ten years beforehand. But what that means, that's the other
• 15:10
  Speaker 8: reason there are so few homes being listed. Not only
• 15:12
  Speaker 8: are people locked into their mortgages, but honestly, there was
• 15:16
  Speaker 8: probably a structural underbuilding of new homes to begin So
• 15:20
  Speaker 8: some of the people have talked about converting some of
• 15:22
  Speaker 8: this office space into residential loans, residential homes, which could
• 15:29
  Speaker 8: offer more opportunities. But you know, from a macro perspective,
• 15:35
  Speaker 8: loans that were made to office spaces that are now
• 15:38
  Speaker 8: falling a price, maybe even underwater, those have to be refinanced,
• 15:42
  Speaker 8: re constructed, you know, on a more regular basis, and
• 15:47
  Speaker 8: that could be a drag for lenders, which, whenever you
• 15:50
  Speaker 8: have a drag in the banking industry, can be a
• 15:54
  Speaker 8: drag generally for the economy.
• 15:56
  Speaker 4: Is the decreasing construction costs and kind of the alleviation
• 16:01
  Speaker 4: of some of the deeper supply chain issues of the
• 16:03
  Speaker 4: pandemic having an impact on home builders that will ever
• 16:07
  Speaker 4: gets passed on to home buyers.
• 16:11
  Speaker 8: Yeah, actually, in some ways it already is. If you
• 16:14
  Speaker 8: look at the difference between the median new home price
• 16:17
  Speaker 8: and the median existing home price, because existing home prices
• 16:21
  Speaker 8: haven't fallen maybe as quickly as some would have expected
• 16:24
  Speaker 8: given the lack of listing, the difference between those is
• 16:27
  Speaker 8: almost a record type, like new homes are normally more
• 16:29
  Speaker 8: expensive right but right now they're just very marginally more expensive.
• 16:34
  Speaker 8: So I think some of that, whether it's you know,
• 16:36
  Speaker 8: through price concessions which actually builders say they're not really
• 16:39
  Speaker 8: offering as much anymore, or just costs coming down relative
• 16:43
  Speaker 8: to what they had been, I think that already is
• 16:47
  Speaker 8: manifesting itself, and some people have I've read some people
• 16:50
  Speaker 8: even calling for new homes to be priced below existing homes.
• 16:54
  Speaker 8: And again this is all median prices, so this is
• 16:56
  Speaker 8: not adjusted for square footage or anything. But it's an
• 17:00
  Speaker 8: interesting you know, potential.
• 17:02
  Speaker 1: Eesg Environmental social governance is that kind of a part
• 17:07
  Speaker 1: of the mortgage lending market as well.
• 17:10
  Speaker 8: It is interestingly I put out a note yesterday that
• 17:13
  Speaker 8: you may have seen that you're referring to, And first
• 17:16
  Speaker 8: of all, in terms of Ginny made mortgages, those back
• 17:19
  Speaker 8: by FHA, for instance, in some ways those were already
• 17:23
  Speaker 8: fundamentally ESG loans because they're targeted towards trying to improved
• 17:27
  Speaker 8: affordability for lower income and higher LTV borrowers. Now Fanny
• 17:31
  Speaker 8: and Freddie have also started to highlight their efforts. They've
• 17:35
  Speaker 8: always they've always had a little bit of a mandate
• 17:37
  Speaker 8: there anyway, and their duty to serve. But they have
• 17:40
  Speaker 8: these new social criteria scores and social density scores that
• 17:44
  Speaker 8: they're publishing that are available here on the terminal that
• 17:47
  Speaker 8: tell you just how many of these socially responsible criteria
• 17:51
  Speaker 8: they're fitting. And in the research that we put out yesterday,
• 17:55
  Speaker 8: we pointed out that some of these highest social responsibility
• 17:58
  Speaker 8: loans and Somebody's offer the best risk award characteristics because
• 18:05
  Speaker 8: a lot of these homeowners are a little more restricted
• 18:07
  Speaker 8: from refinancing, but at the same time they may have
• 18:11
  Speaker 8: more more incentive to be move up borrowers, for instance,
• 18:17
  Speaker 8: so they tend to have less extension risk too.
• 18:20
  Speaker 3: All right, interesting stuff.
• 18:21
  Speaker 1: Always talking about the housing market, the mortgage market. Everybody
• 18:25
  Speaker 1: has their thoughts and opinions. Eric Adelberg, we get pay
• 18:28
  Speaker 1: her to have for those opinions in that analysis. Eric Aidelberg,
• 18:31
  Speaker 1: she's a mortgage backed security strategist for Bloomberg Intelligence. Joining
• 18:34
  Speaker 1: us here in our Bloomberg Interactive Broker Studio again that
• 18:37
  Speaker 1: you know, the bankrate dot com average mortgage rate for
• 18:40
  Speaker 1: thirty year mortgage seven point. It's off the highs, as
• 18:46
  Speaker 1: Erico was just mentioning, but certainly a lot higher than
• 18:49
  Speaker 1: a lot of people want to deal with.
• 18:51
  Speaker 3: That question is to what extent? When will that come down?
• 18:53
  Speaker 9: You're listening to the tape Cat's are Line program Bloomberg
• 18:57
  Speaker 9: Markets weekdays at ten am Eastern on Bloomberg Radio, the
• 19:00
  Speaker 9: tune in app, Bloomberg dot Com, and the Bloomberg Business App.
• 19:03
  Speaker 9: You can also listen live on Amazon Alexa from our
• 19:06
  Speaker 9: flagship New York station. Just say Alexa, play Bloomberg eleven thirty.
• 19:12
  Speaker 6: You know.
• 19:13
  Speaker 1: Every once in a while, we'd like to get a
• 19:14
  Speaker 1: sense of kind of where high net worth investors are
• 19:17
  Speaker 1: putting their capital these days, and to do that we
• 19:19
  Speaker 1: check in with Michael Sonefeld. He's a chairman and founder
• 19:22
  Speaker 1: of Tiger twenty one. Tiger twenty one is a network
• 19:25
  Speaker 1: of learning groups for high net worth investors. We usually
• 19:29
  Speaker 1: get some really interesting perspective from Michael. So Michael, again,
• 19:33
  Speaker 1: the first half of the year was a lot better
• 19:35
  Speaker 1: for most investors in twenty twenty two, where you really
• 19:38
  Speaker 1: had nowhere to hide last year, whether it's equities or
• 19:40
  Speaker 1: fixed income. Maybe some of your alternative investments did better.
• 19:44
  Speaker 1: What are your members saying today? How did they feel
• 19:47
  Speaker 1: here in mid July after what was a pretty good
• 19:49
  Speaker 1: first half of the year.
• 19:52
  Speaker 7: Nice to see you guys, And you know, our members
• 19:55
  Speaker 7: are mixed, like the reports that you've been sharing all morning.
• 19:59
  Speaker 7: On the one hand, inflation is coming down, the business
• 20:03
  Speaker 7: climate is good, unemployment is low, but everybody thinks that
• 20:07
  Speaker 7: we're sort of at the crest, or many people think
• 20:10
  Speaker 7: we're at the crest, and at least half of our
• 20:12
  Speaker 7: members think we're going into recession. And when you have
• 20:16
  Speaker 7: this kind of diversity, our members try and create something
• 20:20
  Speaker 7: like an all weather portfolio where they have some bets
• 20:24
  Speaker 7: on the upside and protection on the downside. And that's
• 20:28
  Speaker 7: sort of been the magic quest that they're looking for
• 20:32
  Speaker 7: in preserving their wealth.
• 20:34
  Speaker 4: Part of the flows into the SMP, obviously related to
• 20:38
  Speaker 4: the Magnificent Seven, are related to the AI rally. I
• 20:42
  Speaker 4: wonder to what extent your clients experience FOMO when something
• 20:46
  Speaker 4: like an AI rally is happening, or are they kind
• 20:48
  Speaker 4: of immune to that?
• 20:50
  Speaker 7: So I just have to say we don't have clients,
• 20:54
  Speaker 7: We only have members. These are all entrepreneurs who have
• 20:57
  Speaker 7: no problem. These are alleople who built great businesses and
• 21:02
  Speaker 7: now we're preserving wealth. But I don't think it's so
• 21:04
  Speaker 7: much bomo because our members have been playing AI. Over
• 21:07
  Speaker 7: fifty six percent of our members either have or intend
• 21:11
  Speaker 7: to make AI investment plays. And one of the things
• 21:14
  Speaker 7: that's really different about AI if you think about recent fads,
• 21:18
  Speaker 7: either in crypto or the web, twenty years ago, when
• 21:21
  Speaker 7: you had these technology plays, you didn't have the equivalent
• 21:25
  Speaker 7: of a Microsoft, which is already a cash flowing company,
• 21:29
  Speaker 7: also be the technology play if you want to play AI.
• 21:32
  Speaker 7: Of course, there's lots of small venture capital opportunities, but
• 21:36
  Speaker 7: the best opportunities, many of our members think, are in
• 21:39
  Speaker 7: like the Microsoft and the Googles that have the largest
• 21:43
  Speaker 7: AI treasure troves, and yet they're really solid businesses. So
• 21:48
  Speaker 7: it's very it's a unique moment in AI that this
• 21:52
  Speaker 7: kind of fad. I don't mean that it's unimportant. I
• 21:54
  Speaker 7: mean this flavor of what everybody is focused on. You're
• 21:58
  Speaker 7: not taking the kind of extra ordinary risks that most
• 22:01
  Speaker 7: other technology rallies require, because here you have comp have
• 22:06
  Speaker 7: real profits and real businesses and real futures no matter
• 22:10
  Speaker 7: what happens on AI. But it'll be really enhanced as
• 22:14
  Speaker 7: they roll out and continue to build their AI functions.
• 22:18
  Speaker 1: Hey, Michael, how about alternative investments? I mean your members
• 22:21
  Speaker 1: they sell oftentimes their businesses for tens or hundreds of
• 22:23
  Speaker 1: millions of dollars and then they really have to allocate
• 22:26
  Speaker 1: capital cross a portfolio. How is investing in alternative investments,
• 22:30
  Speaker 1: whether it's head funds or private equity or private credit.
• 22:32
  Speaker 1: Has that changed over the last decade for your members?
• 22:35
  Speaker 7: So the two biggest changes, The single biggest is that
• 22:40
  Speaker 7: private equity fifteen years ago with about ten percent of
• 22:44
  Speaker 7: our members' portfolios. Today our members manage one hundred and
• 22:48
  Speaker 7: fifty billion dollars and private equity is just about thirty percent. Wow,
• 22:53
  Speaker 7: that's been the biggest change. And a big portion of
• 22:57
  Speaker 7: that private equity is venture capital because a period of
• 23:02
  Speaker 7: time ago you wouldn't have even seen venture capital fifteen
• 23:05
  Speaker 7: years and now we think that's the largest sub segment
• 23:10
  Speaker 7: of private equity. But on the other side, more recently,
• 23:13
  Speaker 7: the biggest down shift we've ever seen is in real estate.
• 23:17
  Speaker 7: Real estate was king for fifteen years bouncing between twenty
• 23:22
  Speaker 7: seven and thirty percent, and in the last year it
• 23:25
  Speaker 7: came down quite precipitously to around twenty two percent. And
• 23:31
  Speaker 7: you know, our members are exquisitely sensitive to interest rates,
• 23:35
  Speaker 7: and as interest rates are going up, that takes some
• 23:40
  Speaker 7: of the potential off the table for real estate. But
• 23:43
  Speaker 7: as your last speaker was mentioning, office, which was one
• 23:48
  Speaker 7: of the most solid areas in the real estate area,
• 23:52
  Speaker 7: is now up for grabs. A lot of problems, not
• 23:55
  Speaker 7: just with vacancies, but you know where offices were easy
• 23:59
  Speaker 7: to lev and so as buildings, they probably are more
• 24:02
  Speaker 7: highly levered and the equity is more at risk. And
• 24:06
  Speaker 7: behind that on the negative would be retail and on
• 24:09
  Speaker 7: the positive side would be industrial. But the office, you know,
• 24:13
  Speaker 7: where the office is going is one of the great
• 24:16
  Speaker 7: conundrums that will only figure out over the next decade.
• 24:20
  Speaker 4: Well, that's one of the things I find interesting about
• 24:23
  Speaker 4: these member feedback results you sent us is that you
• 24:27
  Speaker 4: asked about their most favorite public equity sectors and they're tied.
• 24:31
  Speaker 4: Twenty four percent said real estate and twenty four percent
• 24:34
  Speaker 4: said it. I'm fascinated that real estate is getting as
• 24:38
  Speaker 4: much love as the IT space given the big tech
• 24:41
  Speaker 4: rally that we've seen this year, can you help me
• 24:43
  Speaker 4: make sense of that?
• 24:45
  Speaker 7: Sure, our members are by accomplishment about one in ten thousand,
• 24:51
  Speaker 7: equivalent to being in the major League. And the largest
• 24:55
  Speaker 7: area our members created wealth in maybe a quarter of
• 24:58
  Speaker 7: our members, was in real estate. So you have extraordinary
• 25:03
  Speaker 7: knowledge that most investors don't have. That's the advantage of
• 25:07
  Speaker 7: being in one of our groups and being with somebody
• 25:09
  Speaker 7: who built their career in real estate. So my guess
• 25:12
  Speaker 7: is that real estate has been beaten up in certain
• 25:15
  Speaker 7: areas and our members are a little more attuned. The
• 25:18
  Speaker 7: big question we ask in a meeting is if you
• 25:21
  Speaker 7: buy something at twenty and it goes down to fifteen,
• 25:24
  Speaker 7: should you get out? And the answer is, if you
• 25:27
  Speaker 7: really knew what you were investing at twenty and it
• 25:30
  Speaker 7: goes down to fifteen, it's a better deal. But as
• 25:33
  Speaker 7: I think you guys well know, over the history of
• 25:37
  Speaker 7: the stock market, individual investors have never matched the returns
• 25:41
  Speaker 7: because they buy at the wrong time and sell at
• 25:43
  Speaker 7: the wrong time. And so I think the high interest
• 25:46
  Speaker 7: in real estate opportunities shows the sort of expertise that
• 25:50
  Speaker 7: our members has looking for deals and navigating in this
• 25:55
  Speaker 7: volatile climate.
• 25:57
  Speaker 1: Hey Michael, real quick, just give us the latest on
• 25:59
  Speaker 1: kind of estate planning. What are your members kind of
• 26:02
  Speaker 1: focused on these days.
• 26:04
  Speaker 7: Well, first of all, there's a big date coming up
• 26:07
  Speaker 7: at the end of twenty twenty five where some of
• 26:10
  Speaker 7: the major estate planning tools will sunset. But you know,
• 26:15
  Speaker 7: I think our members are focused on the tension between
• 26:21
  Speaker 7: giving kids too much and ruining. Essentially, what they saw
• 26:28
  Speaker 7: was their entrepreneurial ability to be successful. So this notion,
• 26:33
  Speaker 7: this notion of kying to figure out what to do
• 26:37
  Speaker 7: and how much to leave. So you know, there's something
• 26:40
  Speaker 7: called the giving pledge among billionaires where they are at
• 26:43
  Speaker 7: half of their money to foundation and philanthropy, and a
• 26:47
  Speaker 7: lot of our members are thinking about philanthropy in a
• 26:50
  Speaker 7: new way, particularly with all the problems that are in
• 26:53
  Speaker 7: the world today.
• 26:54
  Speaker 1: All right, Michael, thank you so much for joining us.
• 26:55
  Speaker 1: Always a unique perspective there, Michael Snefelt. He's a chairman
• 26:59
  Speaker 1: and founder of Tiger twenty one kind of collection of
• 27:01
  Speaker 1: high net worth individuals get a really interesting perspective how
• 27:04
  Speaker 1: they allocate capital across the sectors.
• 27:09
  Speaker 9: You're listening to the teenth Ken's Are Live program Bloomberg
• 27:13
  Speaker 9: Markets weekdays at ten am Eastern on Bloomberg dot Com,
• 27:16
  Speaker 9: the iHeartRadio app, and the Bloomberg Business App, or listen
• 27:19
  Speaker 9: on demand wherever you get your podcasts.
• 27:24
  Speaker 1: We've been hearing from a lot of the big banks
• 27:25
  Speaker 1: over the last four or five days talking about their
• 27:28
  Speaker 1: business net interesting income positive, but certainly offset by a
• 27:33
  Speaker 1: lack of deal making for a lot of these companies.
• 27:35
  Speaker 1: Comparisons are very tough. We want to get a sense
• 27:37
  Speaker 1: of what's happening in the mn A space. We talked
• 27:39
  Speaker 1: to Rob Brown, he's the CEO of Lincoln International. He
• 27:42
  Speaker 1: joins us here live in the Bloomberg Interactor Brokers studio.
• 27:45
  Speaker 1: They're based in Chicago, one of my favorite towns anywhere. Rob,
• 27:49
  Speaker 1: thanks for joining us here. Talk to us about kind
• 27:52
  Speaker 1: of the m and A environment we're seeing out there now.
• 27:56
  Speaker 1: A lot of uncertainty about the economy and not historically
• 28:00
  Speaker 1: it doesn't really bode well for boards and CEOs getting
• 28:03
  Speaker 1: out there and putting big capital to work.
• 28:04
  Speaker 3: What are you seeing in your practice?
• 28:05
  Speaker 6: Yeah, I think what you just allude to, Paul is
• 28:08
  Speaker 6: what we've seen really over the last eight months to
• 28:11
  Speaker 6: a year, right, the economic uncertainty really slowing down on
• 28:16
  Speaker 6: the m and a market, and you're seeing it in
• 28:18
  Speaker 6: the release of some of the big bakes and even
• 28:20
  Speaker 6: Goldman's release today, in the investment banking business being down.
• 28:25
  Speaker 10: So I think that's what we've seen.
• 28:26
  Speaker 6: Interestingly, there's some alchemy right now for improved activity, and
• 28:31
  Speaker 6: I think there's really four factors that are driving that.
• 28:34
  Speaker 6: I think one is, if you go back to how
• 28:36
  Speaker 6: we came into the year, there seems to be more
• 28:38
  Speaker 6: consensus of a soft landing, or at least not a
• 28:42
  Speaker 6: really hard landing.
• 28:43
  Speaker 10: And I think there was always that.
• 28:45
  Speaker 6: Fear of investors saying, well, joh, I don't want to put
• 28:47
  Speaker 6: something to work and have the bottom fall out of
• 28:49
  Speaker 6: the economy. So I think the backdrop is we may
• 28:51
  Speaker 6: have a recession, but it's probably not going to be
• 28:53
  Speaker 6: as severe as I thought. I think the other the
• 28:56
  Speaker 6: other key input here is that as each quarter has
• 28:59
  Speaker 6: gone by since probably midyear last year, when you saw
• 29:02
  Speaker 6: inflation spike and the FED respond aggressively, you're seeing sellers
• 29:06
  Speaker 6: expectations moderate.
• 29:07
  Speaker 10: Down a bit.
• 29:07
  Speaker 6: So you know, twenty twenty one and the first half
• 29:10
  Speaker 6: of twenty twenty two were really peak valuations. So I
• 29:12
  Speaker 6: think as time has gone on, sellers are starting to
• 29:14
  Speaker 6: realize I may not be able to sell it for
• 29:17
  Speaker 6: exactly what I could, but I can still get a
• 29:19
  Speaker 6: good return. So and I think the two last pieces
• 29:21
  Speaker 6: are we are seeing the aperture of the private credit
• 29:24
  Speaker 6: markets improve a bit, the credit markets are actually hardening
• 29:28
  Speaker 6: up in a good way, and that lenders are saying,
• 29:30
  Speaker 6: I will finance this deal. It's going to be expensive, right.
• 29:32
  Speaker 6: Rates are high, but they're going to be there. And
• 29:35
  Speaker 6: the last and maybe the biggest driver is the amount
• 29:39
  Speaker 6: of dry powder sitting in institutional equity holders, in private equity,
• 29:43
  Speaker 6: venture capital, and even the private debt funds. It's starting
• 29:46
  Speaker 6: to burn a hole in the pocket of investors, and
• 29:49
  Speaker 6: on top of that, they're under pressure to show some
• 29:51
  Speaker 6: returns and return some capital to raise the next fund.
• 29:55
  Speaker 6: So I think all of that kind of pointing maybe
• 29:58
  Speaker 6: not up hugely, but starting to trend in the right.
• 30:00
  Speaker 6: I think we're expecting much better activity for the back
• 30:02
  Speaker 6: half of the year than the first half.
• 30:04
  Speaker 4: Well, Paul and I talk about this all the time,
• 30:06
  Speaker 4: just that it's a challenging environment to get deals done
• 30:09
  Speaker 4: in I'm curious how your conversations and strategies have shifted,
• 30:14
  Speaker 4: if at all, Given some of the hawkishness that we've
• 30:18
  Speaker 4: seen from the FDC, from the Justice Department when it
• 30:20
  Speaker 4: comes to M and A deals.
• 30:22
  Speaker 10: Well, there's no doubt about that.
• 30:23
  Speaker 6: I mean, we're all trying to wait and see what
• 30:25
  Speaker 6: comes out of the new proposed FTC rules for Heart
• 30:28
  Speaker 6: Scott Ridino and clearance, and we're in a comment period
• 30:32
  Speaker 6: on that, and I know our industry is commenting aggressively
• 30:35
  Speaker 6: to we understand.
• 30:36
  Speaker 10: Listen, these rules haven't been changed in forty or fifty years.
• 30:38
  Speaker 6: It's okay to revisit them, but I think they need
• 30:41
  Speaker 6: to be done in a way that's going to achieve
• 30:43
  Speaker 6: the objective. So there is worry about that. But I
• 30:46
  Speaker 6: think your point is right. Deals are harder to get done.
• 30:48
  Speaker 6: I think what we're seeing is more targeted processes, making
• 30:52
  Speaker 6: sure you have financing lined up before you approach anybody,
• 30:56
  Speaker 6: and really going to investors with a pretty compelling investment
• 30:59
  Speaker 6: thesis that says, listen, you know, we know what you
• 31:03
  Speaker 6: like to acquire. Here's why you really need to look
• 31:05
  Speaker 6: at this. But it's more challenging to get things done right.
• 31:08
  Speaker 6: You got to get the financing in place. I think
• 31:10
  Speaker 6: the leverage has shifted a bit to the buyers in
• 31:13
  Speaker 6: terms of dictating the due diligence schedules and dictating what
• 31:16
  Speaker 6: they need to get done. But we are seeing things
• 31:19
  Speaker 6: get done. They're taking longer, they're a little more painful,
• 31:21
  Speaker 6: but they're getting done.
• 31:23
  Speaker 1: Talk to us about the role of private credit because
• 31:25
  Speaker 1: that's kind of a relatively new business.
• 31:27
  Speaker 3: In Madison.
• 31:27
  Speaker 1: I we spend a lot of time talking about We
• 31:30
  Speaker 1: try to speak to as many smart people as we
• 31:31
  Speaker 1: can about the private credit business because really it's really
• 31:34
  Speaker 1: just became a big source of capital after the financial crisis.
• 31:38
  Speaker 1: How does that factor into your deals? You typically do
• 31:41
  Speaker 1: more middle market transactions. How does that factor into your deal?
• 31:45
  Speaker 10: It factors in massively.
• 31:48
  Speaker 6: Most of our deals, particularly if we're selling to a
• 31:51
  Speaker 6: financial sponsor, a private equity group, or an institutional investor.
• 31:55
  Speaker 6: A good chunk of our deals are going to need
• 31:56
  Speaker 6: leverage to get done. And the entire market for that
• 31:59
  Speaker 6: is a private credit market. I mean, the banks have
• 32:02
  Speaker 6: you know, the compliance issues coming out of the global
• 32:04
  Speaker 6: financial crisis. The banks are out of this market, so
• 32:06
  Speaker 6: now you're dealing with private credit funds, hedge funds, unitronics investors,
• 32:12
  Speaker 6: and that market has attracted a tremendous amount of capital
• 32:17
  Speaker 6: over the last decade, and they have a lot of
• 32:19
  Speaker 6: dry powder too, But that market really closing up a
• 32:23
  Speaker 6: bit in the back half of the last year as
• 32:26
  Speaker 6: much as the fear of the economy downturning is what
• 32:29
  Speaker 6: really casts a little of appall over our market. So
• 32:31
  Speaker 6: what happens in that market is a really important driver
• 32:35
  Speaker 6: of the overall private the overall private capital markets and
• 32:39
  Speaker 6: the deals that get done on the private market.
• 32:41
  Speaker 4: Did some of the banking turmoil have any impact on
• 32:44
  Speaker 4: you guys via the impact on private.
• 32:47
  Speaker 10: Credit, You know, not really.
• 32:52
  Speaker 6: I think in particularly you look at SVB, there was
• 32:54
  Speaker 6: a little bit of a shock as to you know,
• 32:55
  Speaker 6: what does that mean? But they were really in the
• 32:57
  Speaker 6: venture debt market, and so the short answer is not really.
• 33:02
  Speaker 6: Although one thing I will say that's interesting is our
• 33:05
  Speaker 6: European M and A business, and we have offices in
• 33:10
  Speaker 6: sixteen countries, twenty offices. We've got a lot of offices
• 33:13
  Speaker 6: in Europe. It's a big part of our business. That
• 33:15
  Speaker 6: M and A market is actually holding up better than
• 33:17
  Speaker 6: the US M and A market this year, partly because
• 33:21
  Speaker 6: there still is a bank lending market in some of
• 33:23
  Speaker 6: the major economies to get deals done where we don't
• 33:26
  Speaker 6: have that here, so they've been able to look through
• 33:28
  Speaker 6: some of the private credit markets pulling their horns in.
• 33:31
  Speaker 6: I think they also have a situation where in the UK,
• 33:34
  Speaker 6: the largest capital market in Europe, they're worried about a
• 33:37
  Speaker 6: labor government next year and cap gains rates going up,
• 33:40
  Speaker 6: so there's a little bit of a push to get
• 33:42
  Speaker 6: things done now.
• 33:42
  Speaker 4: The more regulation in the UK.
• 33:44
  Speaker 6: Definitely, definitely. I think the regulation headwinds are going to
• 33:47
  Speaker 6: be everywhere.
• 33:48
  Speaker 1: Okay, you guys are a lot bigger than I thought
• 33:50
  Speaker 1: you were in I'm just reading some reporting that you
• 33:53
  Speaker 1: guys did.
• 33:54
  Speaker 3: It recently got into Australia, India.
• 33:57
  Speaker 1: You guys, you said you're in sixteen countries reporting here,
• 34:00
  Speaker 1: eight hundred and fifty investment bankers.
• 34:02
  Speaker 3: Why don't you guys.
• 34:03
  Speaker 10: Public You know we've followed.
• 34:06
  Speaker 6: We have followed our public investors or our public competitors. Right,
• 34:08
  Speaker 6: there's clearly an appetite for what we do. I think
• 34:12
  Speaker 6: for us, we have a pretty clearly stated goal to
• 34:15
  Speaker 6: be the leading advisor in the private capital markets, and
• 34:18
  Speaker 6: to date we felt that being a private.
• 34:21
  Speaker 10: Partnership is the right way to do that.
• 34:23
  Speaker 6: But we're constantly evaluating should we have a different ownership
• 34:26
  Speaker 6: structure and access to broader capital. So it's something we
• 34:30
  Speaker 6: haven't ruled out. And I think we've made some investments
• 34:32
  Speaker 6: to be public company ready. If and when we determine
• 34:36
  Speaker 6: that's the right thing to do.
• 34:37
  Speaker 10: What is the.
• 34:37
  Speaker 4: Biggest benefit for you staying private?
• 34:40
  Speaker 6: Then you know, for us, I think the thing we
• 34:43
  Speaker 6: need to balance that. What's made us unique and what's
• 34:46
  Speaker 6: allowed us to grow from seven of us to one
• 34:49
  Speaker 6: of the largest private markets M and A Advisors in
• 34:52
  Speaker 6: the world has been a real focus on culture that
• 34:55
  Speaker 6: attracts people and keeps people for the long time, long term.
• 34:58
  Speaker 6: And we've been able to define that measure against it
• 35:01
  Speaker 6: managed to it as a private company without having to
• 35:04
  Speaker 6: worry about what's going on in every single quarter. And
• 35:07
  Speaker 6: you know, if we were to go public, we'd want
• 35:09
  Speaker 6: to make sure that we can continue to really have
• 35:11
  Speaker 6: that as the oxygen of everything we do. So and
• 35:16
  Speaker 6: I think part of it's just different, right We kind
• 35:18
  Speaker 6: of know, we know the governance, we know how this works.
• 35:20
  Speaker 10: But I think organizations, if.
• 35:21
  Speaker 6: They're going to evolve, if they're going to continue to grow,
• 35:24
  Speaker 6: have to continually reevaluate, you know, what's the right capital
• 35:27
  Speaker 6: structure and ownership structure to achieve our goals.
• 35:30
  Speaker 1: So India, for example, a lot of folks are saying
• 35:33
  Speaker 1: India over the next twenty years is going to be
• 35:35
  Speaker 1: the It's gonna be China.
• 35:37
  Speaker 6: Was the last twenty years maybe for example, but better.
• 35:40
  Speaker 6: How do you guys view if you I agree with
• 35:42
  Speaker 6: that statement. We have been in India a long time.
• 35:44
  Speaker 6: We've been in India over a decade. We are about
• 35:47
  Speaker 6: to announce in the very near term here an acquisition
• 35:50
  Speaker 6: in India that's going to materially increase our presence there
• 35:55
  Speaker 6: as And we also have offices in China. As we're
• 35:58
  Speaker 6: seeing as we're seeing those off to slow down, as
• 36:01
  Speaker 6: we're seeing the economic ties really cool with China, we
• 36:04
  Speaker 6: think that the biggest benefactor of that is going to
• 36:08
  Speaker 6: be India. I mean India, it's the largest democracy on
• 36:11
  Speaker 6: the planet. Their laws based on English common law, it's
• 36:14
  Speaker 6: much easier to do business there, and it's a really
• 36:18
  Speaker 6: really innovative economy. So we're very bullish on what we're
• 36:23
  Speaker 6: seeing in India right now and really doubling down in
• 36:26
  Speaker 6: that market.
• 36:27
  Speaker 1: And conversely, twenty seconds left China.
• 36:30
  Speaker 6: Yeah, you know, I don't see in the near term
• 36:35
  Speaker 6: any sort of warming up of the economic ties with China.
• 36:38
  Speaker 6: I think that it's very difficult to get a Chinese
• 36:42
  Speaker 6: investor clear we were talking about compliance. Trying to sell
• 36:45
  Speaker 6: something to a Chinese buyer today in any Western country,
• 36:48
  Speaker 6: very very hard.
• 36:49
  Speaker 1: Interesting, all right, Rob, thanks so much for joining us.
• 36:51
  Speaker 1: Fascinating company which I need to learn more about. Rob Brown,
• 36:55
  Speaker 1: CEO of Lincoln International. They're based in the Great City
• 36:58
  Speaker 1: of Chicago, but as Rob is just saying, these guys
• 37:01
  Speaker 1: are all over and they focus on middle market M
• 37:03
  Speaker 1: and A, which, as we've learned from a lot of
• 37:06
  Speaker 1: people like Rob, a very lucrative business. Competitive business, but
• 37:09
  Speaker 1: very lucrative business, and so we'll pay attention to that
• 37:12
  Speaker 1: as well.
• 37:14
  Speaker 9: You're listening to the tape Can't Live program Bloomberg Markets
• 37:18
  Speaker 9: weekdays at ten am Eastern on Bloomberg Radio, the tune
• 37:22
  Speaker 9: in app, Bloomberg dot Com, and the Bloomberg Business App.
• 37:25
  Speaker 9: You can also listen live on Amazon Alexa from our
• 37:27
  Speaker 9: flagship New York station, Just say Alexa play Bloomberg eleven thirty.
• 37:33
  Speaker 3: Let's check out with Poocha Kumra.
• 37:35
  Speaker 1: She's a European rate strategist at TD.
• 37:38
  Speaker 3: Poocha, what did you.
• 37:38
  Speaker 1: Make of the UK economic data. The inflation data came
• 37:42
  Speaker 1: out today.
• 37:43
  Speaker 11: Good morning. Yes, never a dull moment in UK. I
• 37:47
  Speaker 11: think for the first time since February, the inflation did
• 37:50
  Speaker 11: surprise you downside, and I think this has come as
• 37:52
  Speaker 11: a big relief for the hawkish expectations that we're actually
• 37:56
  Speaker 11: playing out in UK and right our markets have actually
• 37:59
  Speaker 11: moved the tom expectations from close to six point five
• 38:03
  Speaker 11: that you saw a month ago to actually five point
• 38:05
  Speaker 11: seventy five, which seems much more reasonable. But as you say,
• 38:08
  Speaker 11: inflation in UK is still very elevated. Food intation is
• 38:12
  Speaker 11: almost thrice the levels that we see in US, so
• 38:15
  Speaker 11: I think we do have a long way to go.
• 38:17
  Speaker 11: But on the positive side, going forward, the base effects
• 38:21
  Speaker 11: both the energy and good prices should actually allow UK
• 38:25
  Speaker 11: inflation to actually be more correlated to what we are
• 38:28
  Speaker 11: seeing in UK and we have in sorry in Europe,
• 38:31
  Speaker 11: and we do see inflation to end the year around
• 38:33
  Speaker 11: the four to five percent level, which is a big
• 38:35
  Speaker 11: relief for BOE as well as riches.
• 38:37
  Speaker 12: Luck.
• 38:38
  Speaker 4: You mentioned the cost of food and I wonder to
• 38:40
  Speaker 4: what extent your average I'm going to steal this from
• 38:44
  Speaker 4: Paul the watering Hole attendees of the UK are able
• 38:48
  Speaker 4: to feel any sort of decrease in the inflation numbers
• 38:52
  Speaker 4: when they're still going out to get the same meal
• 38:55
  Speaker 4: they would have gotten a year ago and it's so
• 38:57
  Speaker 4: much more expensive. Do you have a take on when
• 39:01
  Speaker 4: the consumer in the UK might start to be able
• 39:04
  Speaker 4: to feel any sort of decline to the red hot
• 39:07
  Speaker 4: inflation they've been experiencing.
• 39:10
  Speaker 11: Yes, I mean the last six months have been pretty
• 39:12
  Speaker 11: much high prices everywhere, but we are actually seeing prices
• 39:17
  Speaker 11: going down when we go to all supermarket as well
• 39:20
  Speaker 11: as grocery stores there. We are actually getting emails from
• 39:22
  Speaker 11: all the grocery chains that they are actually reducing prices.
• 39:25
  Speaker 11: So I think there is some government pressure also involved.
• 39:29
  Speaker 11: And also one of the key things that the government
• 39:31
  Speaker 11: as well as the BOE is aware of is that
• 39:34
  Speaker 11: we are going to get very big mortgage payments as
• 39:37
  Speaker 11: we enter towards the end of the year and twenty
• 39:39
  Speaker 11: twenty four, so household buffer is actually going to be
• 39:43
  Speaker 11: more compressed and it's going to be a slow move,
• 39:46
  Speaker 11: but definitely we are moving in the right direction and
• 39:49
  Speaker 11: that should be a good news for you.
• 39:50
  Speaker 7: Ken.
• 39:50
  Speaker 11: That's why the crank basis points rally in today's session.
• 39:54
  Speaker 1: So putji, you talk to your institutional clients around the world,
• 39:59
  Speaker 1: and you're talk talking to about the European rates business,
• 40:02
  Speaker 1: what's kind of the most common trade that you're hearing people,
• 40:06
  Speaker 1: I guess are most interested in right right right now.
• 40:09
  Speaker 11: So right now, I think the US CPI as well
• 40:12
  Speaker 11: as the UK CPI have actually told us one thing
• 40:15
  Speaker 11: that we are done with this entire hiking story you
• 40:17
  Speaker 11: want or two hikes more central banks are done And
• 40:20
  Speaker 11: the key thing is how long we stay here. From
• 40:22
  Speaker 11: a trading perspective, we like long duration and I think
• 40:25
  Speaker 11: that is something even investors are looking at. But I
• 40:28
  Speaker 11: think after today's UK CPI report, one of the key
• 40:31
  Speaker 11: traits that I like is being long UK versus Bunce.
• 40:35
  Speaker 11: Just given the fact that that I think euro has
• 40:37
  Speaker 11: rallied quite a bit, when inflation will be equally sticky
• 40:41
  Speaker 11: in Europe as compared to in UK as.
• 40:43
  Speaker 4: Well, are you thinking about currency quite a bit then
• 40:46
  Speaker 4: in your calculations.
• 40:50
  Speaker 11: When it comes to the general strong pounds.
• 40:55
  Speaker 4: In Yeah, the strong pound, and I guess, particularly as
• 40:58
  Speaker 4: we're starting to see the decline of the U US
• 41:00
  Speaker 4: dollar hitting fourteen months low last week, is that something
• 41:05
  Speaker 4: that you think is going to be potentially a tail
• 41:08
  Speaker 4: or headwind for you this year.
• 41:11
  Speaker 11: I think generally now it's the FEDS show, just because
• 41:14
  Speaker 11: the fact that I mean so far, what we saw
• 41:16
  Speaker 11: that UK was just not correlated with the moves in
• 41:19
  Speaker 11: US as well as in Europe, just because we had
• 41:23
  Speaker 11: the strength of inflation, and BOE actually had to come
• 41:26
  Speaker 11: up more hawkish as well as hawk fifty basis points
• 41:29
  Speaker 11: when most of the central banks are actually at the terminal.
• 41:32
  Speaker 11: But I think that pound strength should actually be a
• 41:36
  Speaker 11: little new, more muted, and we should now be more
• 41:38
  Speaker 11: driven by where FED takes it from here, whether it's
• 41:41
  Speaker 11: one hike or two hikes going forward. And I think
• 41:45
  Speaker 11: that would be key when it comes to messaging going
• 41:47
  Speaker 11: into next week's FED meeting.
• 41:49
  Speaker 1: And to what extent just give us a kind of
• 41:51
  Speaker 1: a little bit of tutorial here, to what extent does
• 41:53
  Speaker 1: the Bank of England and the European Center Bank, to
• 41:56
  Speaker 1: what extent do they follow the US FED Reserve?
• 42:00
  Speaker 11: Well, to quote unquote, I mean actually's on the central
• 42:03
  Speaker 11: back meetings. We are told that we are different, we
• 42:05
  Speaker 11: have different economic background to handle it. But I think
• 42:09
  Speaker 11: FED is one central bank that basically determines interest rate
• 42:14
  Speaker 11: for the entire world, so I think one way or
• 42:17
  Speaker 11: the other one when FED actually decides to stop, it
• 42:20
  Speaker 11: would actually mean that the other central banks also need
• 42:23
  Speaker 11: to do less. So I think yes, FED still plays
• 42:26
  Speaker 11: a very key role when it comes to where terminal comes.
• 42:28
  Speaker 11: For most central.
• 42:29
  Speaker 4: Banks, we think that next week the FED is it
• 42:33
  Speaker 4: seems like a foregone conclusion. Here in the state, it's
• 42:35
  Speaker 4: a twenty five basis point hike. When you look ahead
• 42:39
  Speaker 4: to August for the ECB, is it going to be
• 42:43
  Speaker 4: maybe down to twenty five basis points after this inflation print.
• 42:48
  Speaker 11: So for when it comes to ECB, they've already told
• 42:51
  Speaker 11: us that they will be doing a twenty five basis
• 42:53
  Speaker 11: points in July. I think the key question is whether
• 42:57
  Speaker 11: they go twenty five again in September. I think at
• 43:00
  Speaker 11: this stage they will like to maintain the optionality. But
• 43:03
  Speaker 11: we have had hawks even coming in last this week's thing,
• 43:07
  Speaker 11: that there's no need to press that much on terminal.
• 43:10
  Speaker 11: So I think it is very much possible that we
• 43:12
  Speaker 11: are done with one high. But I think central banks
• 43:16
  Speaker 11: right now, including FED, wants to keep the optionality for
• 43:19
  Speaker 11: going in September as well. And I think the key
• 43:21
  Speaker 11: driver right now will be the August Jackson Hole meeting.
• 43:28
  Speaker 11: I think that would be the stage, the next stage
• 43:30
  Speaker 11: where central banks give us the key insight into what
• 43:33
  Speaker 11: they are thinking for the September meeting. I think right
• 43:35
  Speaker 11: now all central banks want a little more data to
• 43:39
  Speaker 11: convince themselves, whether it's one or two highs and they're done.
• 43:42
  Speaker 1: Hey, Pusha, thanks so much for joining us. Really appreciate
• 43:45
  Speaker 1: getting your perspective. The European call there the UK call
• 43:48
  Speaker 1: on rates Poosiakumra European rates Strategists at TD.
• 43:53
  Speaker 9: You're listening to the Tape Cancer Line program Bloomberg Markets
• 43:56
  Speaker 9: weekdays at ten am Eastern on Bloomberg Radio. Tune in
• 44:00
  Speaker 9: up Bloomberg dot Com and the Bloomberg Business App. You
• 44:03
  Speaker 9: can also listen live on Amazon Alexa from our flagship
• 44:06
  Speaker 9: New York station, Just say Alexa playing Bloomberg eleven thirty.
• 44:12
  Speaker 1: So Madison back in my cell said research days, you'd
• 44:14
  Speaker 1: have to slip out through San Francisco two or three
• 44:17
  Speaker 1: times a year to see institutional investor clients out there.
• 44:19
  Speaker 3: Love that town, still one of my faves.
• 44:22
  Speaker 1: But then you'd have to go not downtown, you have
• 44:24
  Speaker 1: to go slept all the way out to San Mateo
• 44:26
  Speaker 1: to see these Franklin Templeton people.
• 44:28
  Speaker 3: Now, it wasn't a.
• 44:29
  Speaker 1: Bad trip because they have a great Starbucks right there.
• 44:31
  Speaker 1: But nice people, smart people, and they manage a bunch
• 44:35
  Speaker 1: of money. So I've still got some bodies out there
• 44:37
  Speaker 1: from back in the day. Ed Perks, he's out there
• 44:39
  Speaker 1: in San Mateo. He's the CIO Franklin Templeton Income Investors. Ed,
• 44:44
  Speaker 1: I mean, you got fix income folks had a brutal
• 44:48
  Speaker 1: twenty twenty two. There was just nowhere to hide off
• 44:51
  Speaker 1: to a little bit better start this year. How are
• 44:53
  Speaker 1: you guys position out there with some of your fixingcome,
• 44:57
  Speaker 1: you know, kind of asset allocations in your performance?
• 45:01
  Speaker 12: Yeah, absolutely, you're right. Twenty twenty two was a tremendous
• 45:04
  Speaker 12: challenge for fixed income investors. You know, I think the
• 45:07
  Speaker 12: key element for us, for Franklin income investors is multi
• 45:11
  Speaker 12: asset flexibility. So really, at no other time in my career,
• 45:15
  Speaker 12: really have I theened this play out in a six
• 45:18
  Speaker 12: to eight quarter way where we entered twenty twenty two
• 45:22
  Speaker 12: with a very strong bias and tilting our multi asset
• 45:26
  Speaker 12: portfolios towards dividend paying common stock, and that was really
• 45:31
  Speaker 12: just reflecting the landscape and the opportunity set entering last year.
• 45:36
  Speaker 12: Ten year rates were I think we were down here
• 45:38
  Speaker 12: one and a quarter still one in a quarter, one
• 45:40
  Speaker 12: and a half percent, and you just didn't have enough spread.
• 45:44
  Speaker 12: And you know, the key things that we looked to
• 45:46
  Speaker 12: fixed income for in our portfolios attractive yield, potential for
• 45:51
  Speaker 12: some upside, or potential to help diversify our portfolio. And
• 45:55
  Speaker 12: I tell you, you know, most of twenty twenty two,
• 45:57
  Speaker 12: particularly the start of the year, we couldn't check any
• 45:59
  Speaker 12: of those. So we've come full circle though, and today
• 46:03
  Speaker 12: we sit from a tilt of nearly seventy five twenty
• 46:06
  Speaker 12: five in favor of equities eight to twelve quarters ago
• 46:11
  Speaker 12: to now better than sixty forty tilting to fixed income.
• 46:15
  Speaker 12: So that landscape has totally changed. And yes, you are
• 46:18
  Speaker 12: seeing it, whether you look at broader aggregate bomb market returns, investment,
• 46:23
  Speaker 12: great corporate returns. How ye, corporate returns all doing much better,
• 46:26
  Speaker 12: a little paling in comparison to something like the NASDAK move,
• 46:29
  Speaker 12: But I think fixed income investors have a lot to
• 46:32
  Speaker 12: look forward to.
• 46:33
  Speaker 4: Well, Okay, since you brought up the NASDAK move, I
• 46:35
  Speaker 4: just have to ask you about this. We saw the
• 46:37
  Speaker 4: NASDAK dip into the red a couple of minutes ago
• 46:40
  Speaker 4: because of some moves that we're seeing in the big
• 46:43
  Speaker 4: tech names, the Microsoft's, the Googles. It feels like the
• 46:47
  Speaker 4: perfect example of why it's a challenge when you have
• 46:50
  Speaker 4: this breadth of names leading the charge when it comes
• 46:55
  Speaker 4: to these indices. Is that a concern for you that
• 46:59
  Speaker 4: you think think about in terms of your allocation into equities, you.
• 47:04
  Speaker 12: Know it as it relates to the Nasdaq in particular,
• 47:07
  Speaker 12: given given worry income investors, we really aren't too concerned about,
• 47:12
  Speaker 12: you know, some of those moves or the narrowness of
• 47:14
  Speaker 12: the leadership. I know that's well been well discussed in
• 47:18
  Speaker 12: markets here the last couple of months. You know, we're
• 47:21
  Speaker 12: really focused on this kind of broader move. So we
• 47:23
  Speaker 12: clearly point more to you know, the S and P
• 47:25
  Speaker 12: five hundred, both the difference we've seen, the dispersion we've
• 47:30
  Speaker 12: seen year to date between something like the market cap
• 47:33
  Speaker 12: weighted index and the equal weighted index. You know that's
• 47:36
  Speaker 12: starting to perform a little bit better, But we wouldn't
• 47:40
  Speaker 12: be surprised if there's a pretty significant breather here in
• 47:43
  Speaker 12: in equity markets, and uh, you know we are going
• 47:46
  Speaker 12: to see you know, we'll see even even with companies
• 47:51
  Speaker 12: reporting slightly better earnings, we're still looking at at likely
• 47:55
  Speaker 12: flat to slightly negative year year earnings. And that's something
• 47:58
  Speaker 12: that you know, we think as you look forward into
• 48:01
  Speaker 12: the end of twenty three and particularly into twenty twenty four,
• 48:05
  Speaker 12: this bar, the hurdle really starts to rise, because consensus
• 48:10
  Speaker 12: really bakes in a resurgence in growth in Q four
• 48:14
  Speaker 12: and then into twenty twenty four, and we just think
• 48:16
  Speaker 12: that maybe a little premature. You know, we're still looking
• 48:19
  Speaker 12: at a pretty modest level of GDP growth, we're seeing disinflation.
• 48:23
  Speaker 12: We think a lot of companies have actually had a
• 48:25
  Speaker 12: bit more of a struggle with unit volumes, but have
• 48:29
  Speaker 12: had tremendous pricing that's going to start to wane and
• 48:32
  Speaker 12: certainly become much tougher with comps. So you know, we
• 48:36
  Speaker 12: wouldn't be surprised if the remainder of this year might
• 48:39
  Speaker 12: tilt a little bit more to some of the fixed
• 48:41
  Speaker 12: income markets, and equities have some digesting to do of
• 48:45
  Speaker 12: this very big move they've had.
• 48:48
  Speaker 1: Hey ed in the fixed income space, you know, as
• 48:50
  Speaker 1: income investors where are you guys kind of putting.
• 48:52
  Speaker 3: Your money to work? Where have you been putting your
• 48:55
  Speaker 3: money to work this year?
• 48:57
  Speaker 12: Yeah, we've really focused on some of the higher quality
• 49:00
  Speaker 12: segments within investment great corporates. And that's a big difference
• 49:03
  Speaker 12: from you know, last year, where we started with much
• 49:07
  Speaker 12: shorter duration. We're very selective, actually liked high yield bonds.
• 49:11
  Speaker 12: We didn't see the economy completely create airing and then
• 49:14
  Speaker 12: high yield you can find some really interesting opportunities with
• 49:18
  Speaker 12: very minimal interest rate risk as rates move first into
• 49:22
  Speaker 12: the fall last year, then this spring before the regional
• 49:25
  Speaker 12: banking crisis, and then more recently we've had you know,
• 49:28
  Speaker 12: opportunities with the ten year in and around four percent
• 49:32
  Speaker 12: through that level a couple of times, and UH and
• 49:34
  Speaker 12: spreads while not maybe as wide as a lot of
• 49:37
  Speaker 12: credit investors would would you know, would ideally like to see.
• 49:43
  Speaker 12: You had yields at levels that we haven't seen in
• 49:45
  Speaker 12: a while. You had bond prices because of last year's decimation,
• 49:49
  Speaker 12: at much more attractive discounts to face, and like I
• 49:54
  Speaker 12: said before, you know, you want to check some of
• 49:56
  Speaker 12: these boxes and fixed income today, particularly higher quality investment
• 49:59
  Speaker 12: Great corpor Brits you now have that opportunity incomes. Attractive
• 50:03
  Speaker 12: total return possibilities are there as we think rates do
• 50:06
  Speaker 12: decline over the next four to six quarters, and they're
• 50:09
  Speaker 12: nice diversification again in a multi ASID portfolio.
• 50:12
  Speaker 1: Right, hey, Ed, why don't you in your lunch break
• 50:14
  Speaker 1: hop down on the one on one go a little
• 50:16
  Speaker 1: bit south to Coopertino see our friends there that make
• 50:19
  Speaker 1: cell phones and tell them to step up and pay
• 50:21
  Speaker 1: a real dividend. Is that frustrate you as an income investor
• 50:25
  Speaker 1: that you got a company with a ga jillion dollars
• 50:27
  Speaker 1: of cash on a balance sheet, one hundred billion dollars
• 50:29
  Speaker 1: for free cash flow every year and they pay a
• 50:31
  Speaker 1: dividend yield less than one percent.
• 50:33
  Speaker 12: Yeah, you're preaching to the choir. We certainly are strong
• 50:36
  Speaker 12: advocates of that. We think it just makes sound sense.
• 50:39
  Speaker 12: It broadens your investor base, and you know, there's certainly
• 50:42
  Speaker 12: other things that we can do with using convertible securities,
• 50:45
  Speaker 12: for example in our portfolios or other structured equity like
• 50:49
  Speaker 12: investments where you're kind of effectively doing some covered call
• 50:52
  Speaker 12: writing and getting some premium. So you know, we do
• 50:54
  Speaker 12: have some opportunity in lower dividend paying or non dividend
• 50:58
  Speaker 12: paying stocks, but absolutely would firmly agree with you there.
• 51:02
  Speaker 1: All right, if you see him, you know, Tim Cook,
• 51:04
  Speaker 1: around the neighborhood, maybe can put that in his ear.
• 51:07
  Speaker 1: Ed Perks Cio Franklin Income Investors out in San Mateo,
• 51:11
  Speaker 1: giving us some good discussion on income investing.
• 51:15
  Speaker 2: Thanks for listening to the Bloomberg Markets podcasts. You can
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  Speaker 2: at Matt Miller nineteen seventy three.
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  Speaker 1: And I'm Faul Sweeney. I'm on Twitter at pt Sweeney.
• 51:31
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