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A Short-Term Pullback We Should Have Expected · 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. Every business day we bring
• 0:06
  Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along
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  Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
• 0:15
  Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and
• 0:18
  Speaker 1: at Bloomberg dot com slash podcast. Let's get an update
• 0:22
  Speaker 1: on how we should be thinking about these market conditions.
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  Speaker 1: We do that today with a good friend of Bloomberg Radio,
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  Speaker 1: Christina Hooper. She's a chief global market strategist at Investco.
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  Speaker 1: They have a couple of shekels under management, one point
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  Speaker 1: three billion dollars. Christina, thanks so much for joining us again.
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  Speaker 1: All Right, So we've had a couple of days of
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  Speaker 1: some sell offs here, and I guess people are just
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  Speaker 1: kind of, you know, asking, just casually, is this something
• 0:46
  Speaker 1: it's just a little bit of a pullback. What is
• 0:48
  Speaker 1: you know, a longer term bull market or is this
• 0:50
  Speaker 1: showing some cracks in what had been a pretty good
• 0:54
  Speaker 1: narrative for this market. I think it's a short term pullback,
• 0:59
  Speaker 1: and and quite frankly, I think we should have expected it.
• 1:02
  Speaker 1: Um what we saw was the ten year yield go
• 1:06
  Speaker 1: up significantly earlier this year, and markets react to it.
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  Speaker 1: Reacted to it, particularly tech because of its higher valuations.
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  Speaker 1: It's more sensitive. UH. And then as yields back down,
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  Speaker 1: there was this wave of relief and people started changing
• 1:23
  Speaker 1: their expectations for the ten year For the rest of
• 1:26
  Speaker 1: of UM, I've always expected that the ten year yield
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  Speaker 1: will finish the year at two percent or higher, and
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  Speaker 1: that means some pressure on stocks, particularly tech stocks, as
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  Speaker 1: they digest UH those higher levels of rates. That doesn't
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  Speaker 1: mean that this is the end UM. It just means
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  Speaker 1: we're going through an adjustment period. So Critty Gouta was
• 1:51
  Speaker 1: on earlier though and told us, you know, the big
• 1:53
  Speaker 1: fang stocks are now sitting at the kind of valuations
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  Speaker 1: we saw in two thousand nineteen. UM. Why you know
• 2:02
  Speaker 1: completely reset? Are aren't we still expecting UM the pandemic
• 2:06
  Speaker 1: trends to be sticky and hold as we reopen. Well,
• 2:11
  Speaker 1: I think certainly some pandemic trends will be sticky. We
• 2:15
  Speaker 1: are going to see elevated e commerce sales going forward.
• 2:19
  Speaker 1: As one example, we are going to see more of
• 2:21
  Speaker 1: a hybrid model for many employees. They're going to be
• 2:26
  Speaker 1: working from home more often. Uh so. So certainly some
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  Speaker 1: trends hold, even if they moderate a bit. But we're
• 2:34
  Speaker 1: also not factoring in that companies have significant cash on
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  Speaker 1: balance sheets, and in an expansionary environment, they're likely to
• 2:43
  Speaker 1: spend more on investment, and I would argue more of
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  Speaker 1: those investment dollars are going to go into tech. In fact,
• 2:51
  Speaker 1: if we look at the last Federal Reserve basebook, the
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  Speaker 1: Cleveland Said reported that some of its contacts indicated they
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  Speaker 1: were planning to adopt more technology in lieu of more
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  Speaker 1: employees to keep up with demand, given that it's it's
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  Speaker 1: been difficult to source employees. Yeah, Christina, that's kind of
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  Speaker 1: where I wanted to go. I mean, we've now had
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  Speaker 1: a couple of days to digest that, you know, exceptionally
• 3:15
  Speaker 1: weak jobs report on Friday one of the narratives that's
• 3:18
  Speaker 1: I think finding its way into the marketplaces. Boy, if
• 3:21
  Speaker 1: corporate America wants to get people back to work, they're
• 3:22
  Speaker 1: gonna have to raise pay and that might cause some
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  Speaker 1: wage inflation into this economy. How do you think about
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  Speaker 1: Friday and maybe what it might mean going forward for
• 3:31
  Speaker 1: the economy and for policymakers. Well, I certainly believe there
• 3:36
  Speaker 1: is some truth UH to the argument that we are. UM.
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  Speaker 1: We have generous fiscal stimulus, including generous unemployment benefits, and
• 3:46
  Speaker 1: that is one deterrent to people returning to work. But
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  Speaker 1: we have to recognize that that is a relatively short
• 3:53
  Speaker 1: term deterrent. It ends in September, and in fact, some
• 3:56
  Speaker 1: states are ending it as soon as June. So but
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  Speaker 1: there are other reasons. Right, We've got health safety concerns,
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  Speaker 1: We've got public transportation schedules that are UM not back
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  Speaker 1: to normal yet, and we have childcare issues for many Americans.
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  Speaker 1: All those issues are very short term in nature. So yes,
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  Speaker 1: we're already starting to see wage increases in some industries
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  Speaker 1: in some regions, but I don't think we're going to
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  Speaker 1: see any kind of traumatic overall increase in wages. There
• 4:26
  Speaker 1: should be more workers coming online in the coming months.
• 4:30
  Speaker 1: What about the idea that growth and you know, earnings,
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  Speaker 1: economic growth and earnings growth has peaked in this quarter
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  Speaker 1: or is peaking as we speak. I absolutely disagree with that. UM.
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  Speaker 1: We are just beginning what I think is going to
• 4:45
  Speaker 1: be a very strong economic acceleration, and so I don't
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  Speaker 1: believe earnings have peaked. UM. I don't think we're anywhere
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  Speaker 1: in you're peaking right now? Alright, Christina, what are the
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  Speaker 1: sectors that you guys are doing the most work in
• 4:59
  Speaker 1: right now? Well, of course, our view is that in
• 5:05
  Speaker 1: in an environment like this where the economy is accelerating,
• 5:08
  Speaker 1: typically we're going to see cyclicals outperform, and that's likely
• 5:12
  Speaker 1: to continue through this year. But that doesn't mean that
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  Speaker 1: we want to uh completely dismiss or overlook the growth
• 5:22
  Speaker 1: side of the equation. In fact, days like today remind
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  Speaker 1: us that there can be valuation opportunities created in this
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  Speaker 1: kind of environment, especially for tech. Now are we getting
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  Speaker 1: Are we now at a point where tech is a
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  Speaker 1: screening by no um? But it certainly looks more attractive
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  Speaker 1: today than it did look a few days ago, and
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  Speaker 1: it could look more attractive in a few more days.
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  Speaker 1: So for those with a long term investment horizon, which
• 5:51
  Speaker 1: I hope that everyone has um, this could be an
• 5:54
  Speaker 1: opportunity to pick up some some really attractive names at
• 5:57
  Speaker 1: lower prices. How important is it by the way that
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  Speaker 1: Biden gets his infrastructure his spending plans through, Well, we
• 6:05
  Speaker 1: certainly already have a very robust environment in terms of
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  Speaker 1: physical stimulus. If we look at the US now versus
• 6:13
  Speaker 1: how much UM we saw in the way of fiscal
• 6:15
  Speaker 1: outlays during global financial crisis to the percentage of GDP.
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  Speaker 1: We're doing much better now. Um So it's not as important,
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  Speaker 1: but it would be nice to have Christina. Thanks so
• 6:24
  Speaker 1: much for joining us. Christina Hooper is the chief Global
• 6:27
  Speaker 1: market strategist at Investo, with more than a trillion dollars
• 6:32
  Speaker 1: more than a trillion and a third under management. This
• 6:36
  Speaker 1: is Bloomberg. Let's get over now to Mark Nelson. He's
• 6:43
  Speaker 1: the CEO of of Tableau UM, which can hardly be
• 6:47
  Speaker 1: considered a small cap. They were bought for more than
• 6:48
  Speaker 1: fifteen billion dollars by Salesforce back in pre pandemic? Was
• 6:55
  Speaker 1: that that deal? Mark joins us on the future of
• 6:58
  Speaker 1: enterprise technology and how analytics can transform business. Those are
• 7:02
  Speaker 1: kind of jargon e taglines there, Mark, But what are
• 7:05
  Speaker 1: you really doing to change the way people work day
• 7:08
  Speaker 1: by day? Yeah? Thanks for having me this morning. Um So.
• 7:13
  Speaker 1: Our mission here at Tableau has always been to help
• 7:16
  Speaker 1: people see and understand data. We're at a point in
• 7:20
  Speaker 1: the universe where the ability to gather data, store data,
• 7:24
  Speaker 1: process data, and then look at it and make decisions
• 7:27
  Speaker 1: from it has really introduced something that is as transformational
• 7:32
  Speaker 1: as the microscope or the telescope. It really lets you
• 7:35
  Speaker 1: see things about the world around you that have kind
• 7:38
  Speaker 1: of always been there, but you've never had the ability
• 7:40
  Speaker 1: to see it. And our mission is really to provide
• 7:44
  Speaker 1: a tool that lets lets people work with that data,
• 7:47
  Speaker 1: understand that data, and answer questions in their day to
• 7:50
  Speaker 1: day life. Not just analysts, but every knowledge worker as
• 7:53
  Speaker 1: they're doing their jobs, being able to see the data
• 7:56
  Speaker 1: that's relevant to them, understand it and make decisions be
• 8:00
  Speaker 1: done it. Mark, how has your business of Tableau? How
• 8:04
  Speaker 1: did it change during the pandemic? Has it been materially
• 8:07
  Speaker 1: changed during the pandemic? Of course they got bought exactly. Yeah, well,
• 8:13
  Speaker 1: so to two separate questions that I can talk about.
• 8:15
  Speaker 1: So during the pandemic, like the last year, has has
• 8:19
  Speaker 1: made every business a go through a digital transformation if
• 8:23
  Speaker 1: they weren't already, And the heart of every digital transformation
• 8:26
  Speaker 1: is a data transformation. Things have been changing so fast
• 8:30
  Speaker 1: in the world and for every business. The businesses that
• 8:32
  Speaker 1: have thrived to been the ones have been able to
• 8:35
  Speaker 1: empirically measure what's going on in their business and and
• 8:39
  Speaker 1: just react to it so much faster. That need to
• 8:42
  Speaker 1: be able to see, understand, and react and make decisions
• 8:46
  Speaker 1: based on data has been huge, and we've really seen
• 8:49
  Speaker 1: that for our customers everywhere, from your customers who are
• 8:52
  Speaker 1: quickly adopting a digital model and e commerce to those
• 8:56
  Speaker 1: dealing with the front line of the pandemic and trying
• 8:58
  Speaker 1: to get out COVID data and trying to to validate
• 9:00
  Speaker 1: vaccines on the acquisition. You know, the combination of Tableau
• 9:05
  Speaker 1: and Salesforce together um is like putting p bar and
• 9:08
  Speaker 1: chocolate together, right, Like you take the amazing Customer three
• 9:11
  Speaker 1: sixty application suite from Salesforce that works on and generates
• 9:16
  Speaker 1: some of the most valuable data for a business and
• 9:19
  Speaker 1: Tableau that let's you see and understand that data and
• 9:21
  Speaker 1: get answers from that data, and you just have this
• 9:24
  Speaker 1: ability to do things you were never able to do before,
• 9:27
  Speaker 1: to really get a sense of your business and that
• 9:29
  Speaker 1: sense of where your business is going that you were
• 9:32
  Speaker 1: never able to do before. So those two things, and
• 9:35
  Speaker 1: you know, temporarily related, but have been great and I
• 9:38
  Speaker 1: mean I love that. So Tableau was started, I think
• 9:41
  Speaker 1: at least in part with help in the Defense Department right,
• 9:44
  Speaker 1: the US and Stanford. Obviously everything starts at Stanford. But
• 9:49
  Speaker 1: Mark Benioff calls the company his brother from another mother,
• 9:52
  Speaker 1: which I think is pretty cool. And now you're doing
• 9:55
  Speaker 1: Now you're helping to UM try and attack the racial
• 10:00
  Speaker 1: inequality problem, the sort of diversity and inclusion problems as well.
• 10:04
  Speaker 1: How does that work? Yeah? For sure. So data is
• 10:08
  Speaker 1: so useful on helping with these large societal problems, right
• 10:12
  Speaker 1: that are so emotionally charged and can get wrapped up
• 10:16
  Speaker 1: in in a whole bunch of things. Data is our superpower, right.
• 10:21
  Speaker 1: What we bring to that is the ability to you know,
• 10:25
  Speaker 1: really look at data and understand it, to help understand
• 10:28
  Speaker 1: what the problems are, UM, what solutions can be found
• 10:33
  Speaker 1: for these and how effective those solutions are. And so
• 10:36
  Speaker 1: during this we have launched the Racial Equity Data Hub
• 10:41
  Speaker 1: along with our our partners like policy Link, to really
• 10:44
  Speaker 1: provide data and to do a couple of things. One
• 10:46
  Speaker 1: is to democratize access to that data so a whole
• 10:50
  Speaker 1: bunch of people can help work on these really hard problems.
• 10:53
  Speaker 1: To de advertise that data so that you can really
• 10:56
  Speaker 1: get down to which which groups are really being a
• 11:00
  Speaker 1: acted by this, and then ultimately to be able to
• 11:02
  Speaker 1: let people see data about these problems, so again we
• 11:05
  Speaker 1: can help find solutions and measure the efficacy of those
• 11:08
  Speaker 1: solutions as they're implemented. Thanks so much for joining us.
• 11:11
  Speaker 1: We really appreciate it. Mark Nelson, see you of Tableau
• 11:15
  Speaker 1: talk to us about, you know, enterprise computing, particularly as
• 11:19
  Speaker 1: you know, during this pandemic, there's been such a digitization
• 11:22
  Speaker 1: of so many businesses, more than than before, and of
• 11:25
  Speaker 1: course that generates a tremendous amount of data, and that
• 11:29
  Speaker 1: generates demand and in the need for management teams to
• 11:31
  Speaker 1: get a real handle on that data and what it
• 11:34
  Speaker 1: means for their businesses, and the good folks at Tableau
• 11:37
  Speaker 1: help with that. Now, let's bring in Brad McMillan. He's
• 11:41
  Speaker 1: the chief investment officer at Commonwealth Financial Network. They have
• 11:46
  Speaker 1: about two hundred and thirty three billion dollars in assets
• 11:50
  Speaker 1: under management. And let me first ask you about this.
• 11:54
  Speaker 1: I think the word sell off has been overused a
• 11:56
  Speaker 1: little bit. Certainly, markets are down one and a half
• 11:59
  Speaker 1: percent on the day out in the S and P.
• 12:00
  Speaker 1: They were down yesterday as well. Does this look like
• 12:04
  Speaker 1: we're going into a correction to you, Brad or um,
• 12:07
  Speaker 1: how do you judge what is mostly really a big
• 12:10
  Speaker 1: tech slump, and I think that's exactly right. The tech
• 12:14
  Speaker 1: companies have gotten ahead of themselves a bit um they're
• 12:18
  Speaker 1: pulling back, you know. I don't think this is anything
• 12:20
  Speaker 1: out of the ordinary. There's a lot of talk about
• 12:23
  Speaker 1: inflation going up, but this isn't really news. There's nothing
• 12:27
  Speaker 1: news out there, so I think this is just normal action.
• 12:29
  Speaker 1: I don't see this. I think this is the start
• 12:31
  Speaker 1: of anything worse. All right, So where are you, Brad
• 12:34
  Speaker 1: in terms of where you're looking to allocate capital here?
• 12:38
  Speaker 1: I mean in the equity markets. It's that pull and
• 12:40
  Speaker 1: push between you know. I'm sticking with those big cap
• 12:42
  Speaker 1: growth names. They've worked so well for me since the
• 12:44
  Speaker 1: financial crisis. Really, if you think back that far, or
• 12:47
  Speaker 1: do I play that rotation trade, that reopen trade? Where
• 12:50
  Speaker 1: are you kind of looking these days? I think the
• 12:54
  Speaker 1: rotation trade makes a lot of sense. Not that the
• 12:56
  Speaker 1: big you know, tech megacaps aren't going to do well,
• 12:59
  Speaker 1: of course they are, but that's what investors expect. What
• 13:02
  Speaker 1: you want to do is play where investors aren't looking yet.
• 13:05
  Speaker 1: So when you look at financials, for example, you have
• 13:08
  Speaker 1: banks that are all of a sudden starting to make money,
• 13:11
  Speaker 1: and as the economy reopens, they're going to be in
• 13:13
  Speaker 1: a position to make more. You look at housing, yes,
• 13:16
  Speaker 1: that's a story that's gotten a lot of press, but
• 13:18
  Speaker 1: the millennials are moving out to the suburbs in a
• 13:21
  Speaker 1: big way. In other words, let's gate to where the
• 13:23
  Speaker 1: puck is going, not where the puck is and that's
• 13:26
  Speaker 1: the rotation track. What do you think about the banks?
• 13:30
  Speaker 1: You know, um, they have they're on the upside today
• 13:34
  Speaker 1: and they've had some momentum lately with the cyclicals, but um,
• 13:37
  Speaker 1: we're not getting any indication that rates are going to
• 13:40
  Speaker 1: rise within the next couple of years. And when you
• 13:44
  Speaker 1: look at the banks business model, historically that's been a
• 13:47
  Speaker 1: red flag, not question. But then when you start to
• 13:49
  Speaker 1: look at banks and financial service firms more generally, they're
• 13:53
  Speaker 1: moving away from interest rate driven revenue generation. They're moving
• 13:57
  Speaker 1: more towards speed. And as you move to a more
• 14:00
  Speaker 1: auductized financial economy, you know, some of the biggest financial platforms,
• 14:05
  Speaker 1: you know, the major banks, for example, are uniquely positioned
• 14:09
  Speaker 1: to start to change that business model. And I think
• 14:11
  Speaker 1: that's exactly what you're seeing. So not only will it
• 14:14
  Speaker 1: be a more um more reliable revenue stream. It also
• 14:19
  Speaker 1: frees them from the curinay of the interest rate cycle.
• 14:22
  Speaker 1: That story is not done yet, but that's where they're headed.
• 14:25
  Speaker 1: I think that's part of what's driving this and taking
• 14:27
  Speaker 1: it away from the interest rate story. Brad. One of
• 14:30
  Speaker 1: the concerns out there is taxes and how this tax
• 14:34
  Speaker 1: scheme in this country may change going forward, both at
• 14:38
  Speaker 1: the corporate level, uh and at the personal level. How
• 14:41
  Speaker 1: do you think about that? Well, I look at it
• 14:44
  Speaker 1: this way. If you look at the if you look
• 14:47
  Speaker 1: at the Biden tax proposal, some of the analyzes I've
• 14:50
  Speaker 1: seen says that, okay, that could hit SMP earnings similar
• 14:54
  Speaker 1: between five and ten percent depending on sect. Okay, fair enough,
• 14:58
  Speaker 1: and you know if you just kind of eight line
• 15:00
  Speaker 1: that that could knock some points off the market. But again,
• 15:03
  Speaker 1: that's not a big deal in the broad scheme of things.
• 15:06
  Speaker 1: And when you start to think about what's actually going
• 15:08
  Speaker 1: to happen, which probably isn't what's proposed, and then you
• 15:12
  Speaker 1: start to compare that with the time frame and how
• 15:14
  Speaker 1: earnings are likely to increase over that time frame, I
• 15:17
  Speaker 1: don't think there's gonna be a material impact over time.
• 15:20
  Speaker 1: There might be a glitch, but we've got a lot
• 15:23
  Speaker 1: of cushion here to absorb that if it happens, and
• 15:26
  Speaker 1: it hasn't happened yet. What's the biggest headwind, what's the
• 15:30
  Speaker 1: biggest risk that you're that you're watching out for. I'm
• 15:34
  Speaker 1: watching employment. One of the things that UM is assumed
• 15:39
  Speaker 1: in a lot of analyzes, including mind, is that we're
• 15:42
  Speaker 1: going to see job growth, you know, bounce back, and
• 15:44
  Speaker 1: we're going to be back to something like normal employment,
• 15:47
  Speaker 1: not full employment, something like normal at the end of
• 15:50
  Speaker 1: the year. But one of the things that came up
• 15:52
  Speaker 1: with the most recent jobs report, I look at the number,
• 15:55
  Speaker 1: I'm not worried about the number because a lot of
• 15:58
  Speaker 1: that is seasonal adjustments, and if you look at non
• 16:00
  Speaker 1: seasonally adjusted numbers were right on tracks. I'm not worried
• 16:03
  Speaker 1: about that. But one of the questions is are people
• 16:07
  Speaker 1: really willing to go back to work? And I think
• 16:10
  Speaker 1: that's something that a lot of us, me included, haven't
• 16:12
  Speaker 1: thought about enough. So job growth is going to be
• 16:15
  Speaker 1: the key for the rest of the year. Are you
• 16:17
  Speaker 1: concerned about wage inflation coming into this economy? Not really.
• 16:23
  Speaker 1: And the reason I say that is when you look
• 16:25
  Speaker 1: at wage inflation. First of all, it's been depressed for
• 16:28
  Speaker 1: the past couple of decades, so you know, I think
• 16:31
  Speaker 1: I think some catch up here is frankly overdo. From
• 16:35
  Speaker 1: an economic standpoint. You'll hear a lot about the effects
• 16:37
  Speaker 1: on inflation, which I don't think it's necessarily the case
• 16:41
  Speaker 1: because we don't have the transmission mechanisms like unions and
• 16:45
  Speaker 1: wage price agreements that we had in the seventies. But
• 16:49
  Speaker 1: more to the more to the point that money is
• 16:51
  Speaker 1: going to be spent, that's actually gonna be additive to growth.
• 16:55
  Speaker 1: Those people are buying large going to spend the money
• 16:57
  Speaker 1: and that's gonna help. I think it's a good thing,
• 16:59
  Speaker 1: all right, I really appreciate it. Brad McMillan, chief Investment
• 17:03
  Speaker 1: Officer for Commonwealth Financial Network, giving us his thoughts on
• 17:06
  Speaker 1: the market. Still long that rotation trade. I want to
• 17:13
  Speaker 1: bring in Margaret Franklin. She is the president and CEO
• 17:16
  Speaker 1: of the c f A Institute, and so many of
• 17:19
  Speaker 1: our listeners Margaret r c f A s or want
• 17:22
  Speaker 1: to become c f AS. It's great time to have
• 17:24
  Speaker 1: you on because yes yesterday I was talking to a
• 17:26
  Speaker 1: younger c f A and of course Paul Sweeney is
• 17:30
  Speaker 1: himself an older cf A. I was wondering, has the
• 17:35
  Speaker 1: test gotten harder? Are you making it more difficult? Well,
• 17:40
  Speaker 1: I think it depends on what you've been focusing on.
• 17:43
  Speaker 1: How long ago you wrote it um. Of course the
• 17:46
  Speaker 1: test will seem a lot harder UM if you wrote
• 17:49
  Speaker 1: it twenty years ago, just because the very nature of
• 17:52
  Speaker 1: the capital market. So the quality and rigor are consistent,
• 17:57
  Speaker 1: but they do match what's going on in the market.
• 17:59
  Speaker 1: So I know I would have to study pretty hard
• 18:01
  Speaker 1: for the exams today, irrespective of already having my c
• 18:05
  Speaker 1: f A charter. Margaret, I want to talk about a
• 18:08
  Speaker 1: topic that's become much much bigger part of the investment process.
• 18:11
  Speaker 1: That's E s G investing. You look at the environment,
• 18:14
  Speaker 1: social and governance here, how does the cf AS to
• 18:19
  Speaker 1: think about E s G and making sure that you
• 18:22
  Speaker 1: know it's charter holders, you know what they need to know. Well,
• 18:26
  Speaker 1: you've touched on something that has been important for about
• 18:30
  Speaker 1: the last five years of note, but has been accelerating
• 18:34
  Speaker 1: since Davos in UM two thousand January. And this is
• 18:39
  Speaker 1: an excellent example of what is now required of all
• 18:43
  Speaker 1: investment professionals, which is lifelong, continuous learning anybody five years
• 18:47
  Speaker 1: ago wouldn't have had the E s G skills broadly
• 18:51
  Speaker 1: speaking that are required now from a portfolio perspective. So
• 18:55
  Speaker 1: in addition to the c f A charter, we have
• 18:58
  Speaker 1: launched this year E s G certificate. It was created
• 19:02
  Speaker 1: by our c f A u K Society UM and
• 19:05
  Speaker 1: we've taken that global in the last two months and
• 19:09
  Speaker 1: it really enables UH investment professionals to have the skills
• 19:14
  Speaker 1: necessary to think about m E s G, incorporating them
• 19:18
  Speaker 1: into their portfolio, security selection and meeting client meeting client needs.
• 19:25
  Speaker 1: So that's one aspect of hang on. Is that another
• 19:28
  Speaker 1: is that another year of study then or can c
• 19:31
  Speaker 1: f A perspectives earned both at the same time. Anybody
• 19:36
  Speaker 1: can write it and you can do it concurrent, although
• 19:39
  Speaker 1: UM I want to hear from those who are actually
• 19:41
  Speaker 1: doing both at the same time and the tips and
• 19:43
  Speaker 1: tricks that they're doing for it. UM. Anybody can write it.
• 19:46
  Speaker 1: In fact, UM. The experience with the with it initially
• 19:50
  Speaker 1: has been that it's a lot of non members and
• 19:52
  Speaker 1: non charter holders that are writing it UM and that
• 19:55
  Speaker 1: really speaks to the very pervasive need for it. We
• 20:00
  Speaker 1: had conducted a study UM of a million linked in
• 20:04
  Speaker 1: profiles and in fact UM really less than eight thousand
• 20:09
  Speaker 1: people out of a million had listed UM E s
• 20:12
  Speaker 1: G skills and then we simultaneously did a look at
• 20:16
  Speaker 1: ten thousand job postings and of that almost thirty we're
• 20:20
  Speaker 1: looking for those types of skills. So we know out
• 20:23
  Speaker 1: there that there is a real supply and demand gap
• 20:26
  Speaker 1: and we think that the E s G Certificate does
• 20:28
  Speaker 1: a really fabulous job of meeting that. Margaret, I know,
• 20:31
  Speaker 1: UH May eighteenth, the Alpha Summit is going to take place.
• 20:35
  Speaker 1: You're gonna be part of that. Tell us about the
• 20:37
  Speaker 1: summit and kind of what are some of the key
• 20:39
  Speaker 1: topics you all plan to tackle there. Well, it's very exciting.
• 20:44
  Speaker 1: This is our annual conference, which will be virtual this
• 20:46
  Speaker 1: year for investment professionals around the globe. UM. There will
• 20:51
  Speaker 1: be live conversations on a broad range of topics and
• 20:54
  Speaker 1: they're led by really change makers in the industry. So
• 20:58
  Speaker 1: to just UM leverage off the conversation we just had,
• 21:02
  Speaker 1: we had our we have our net zero carbon emissions
• 21:06
  Speaker 1: conversation that will be with a panel of three but
• 21:10
  Speaker 1: most notably Mary Robinson, the former Prime Minister from Ireland
• 21:14
  Speaker 1: UH and Special Envoy to UM Special Envoy to the
• 21:18
  Speaker 1: u N on Climate is going to be part of
• 21:22
  Speaker 1: that conversation and in our preparation for it, one of
• 21:25
  Speaker 1: the things she said was, this is the most important
• 21:27
  Speaker 1: year coming up to Cup twenty six in probably one
• 21:30
  Speaker 1: of the most important moments in time for humankind UM.
• 21:34
  Speaker 1: And so it's really getting the right people at the
• 21:36
  Speaker 1: table for those important topics. We have Shiro Mazzouno, who
• 21:40
  Speaker 1: is UN Special Envoy on Innovative Finance and Sustainable Investment,
• 21:45
  Speaker 1: and of course he's just come off of the UM
• 21:48
  Speaker 1: the reformational Chief Investment Office for the world's largest pension
• 21:54
  Speaker 1: plan UH, the Japan gp I F and a really
• 21:58
  Speaker 1: provocative think are very vocal on how to implement portfolios
• 22:04
  Speaker 1: with the climate aspect to it. We've got Michael Lewis speaking. Yeah. Yeah,
• 22:10
  Speaker 1: so you know he speaks about every few years when
• 22:13
  Speaker 1: he's got a good provocative book out. He's articulate, he's entertaining,
• 22:20
  Speaker 1: and he holds no punches at all when he is
• 22:23
  Speaker 1: speaking to this particular audience because it's investment professionals and
• 22:26
  Speaker 1: capital allocators. Yeah. Absolutely, And we're starting to see Margaret
• 22:31
  Speaker 1: Um issues pop up about compliance, know your customer again
• 22:37
  Speaker 1: kind of we're starting to see almost great financial crisis
• 22:40
  Speaker 1: style issues, not that that prevalent, of course, how important
• 22:45
  Speaker 1: is that in the CFA And are there are there
• 22:47
  Speaker 1: aspects of the tests that you have been emphasizing more
• 22:50
  Speaker 1: than others as as time goes on. Yeah, So I think,
• 22:54
  Speaker 1: first of all, let me start by saying everything with
• 22:57
  Speaker 1: the E with cf A really does center on ethical
• 23:01
  Speaker 1: and fiduciary orientation. That is, putting your clients interests ahead
• 23:06
  Speaker 1: of yourself and critically important to build and restore trust
• 23:11
  Speaker 1: within the system. UM. We do have, obviously, the cf
• 23:15
  Speaker 1: A Charter program, which is foundational in nature and it
• 23:18
  Speaker 1: changes with the time, so it's got about this close
• 23:22
  Speaker 1: to UM of E s G ingrained, integrated throughout the program,
• 23:27
  Speaker 1: derivative much more on the private client UM than, for instance,
• 23:32
  Speaker 1: many of us from years ago would have written. So
• 23:36
  Speaker 1: you know, there's the practical application as well as foundational
• 23:39
  Speaker 1: UM foundational knowledge, but our professional learning and much of
• 23:43
  Speaker 1: our research and advocacy is becoming much more responsive to
• 23:48
  Speaker 1: an accelerated UM changing nature between UM, social media, UH
• 23:55
  Speaker 1: news strategies and things are incredibly important for people to
• 23:59
  Speaker 1: be thinking about. So it's been vocal on spack Uh products,
• 24:02
  Speaker 1: and we're actually establishing a working group to provide input,
• 24:07
  Speaker 1: for for instance, to this SEC who are also looking
• 24:11
  Speaker 1: at this. And so those are things that can pop
• 24:13
  Speaker 1: up very quickly that are meaningful where we think c
• 24:15
  Speaker 1: f A Institute with its convening power and broad constituent
• 24:19
  Speaker 1: group can add to that conversation. Margaret, thank you so
• 24:22
  Speaker 1: much for joining us. We really appreciate it. Fascinating stuff.
• 24:25
  Speaker 1: Margaret Franklin's us the CEO of c f A Institute
• 24:29
  Speaker 1: talking about sustainable investing e s G and how the
• 24:32
  Speaker 1: c FA prepares folks for that. Thanks for listening to
• 24:36
  Speaker 1: the Bloomberg Markets podcast. You can subscribe and listen to
• 24:39
  Speaker 1: interviews at Apple Podcasts or whatever podcast platform you prefer.
• 24:44
  Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller three
• 24:48
  Speaker 1: on Fall Sweeney I'm on Twitter at pt Sweeney. Before
• 24:51
  Speaker 1: the podcast, you can always catch us worldwide at Bloomberg
• 24:54
  Speaker 1: Radio