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Uber Offers Self-Driving Cars; Gold vs. Crude · Bloomberg Intelligence

• 0:01
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
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• 0:15
  Speaker 2: Joining us now in studio. Man Deep Sync senior technology
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  Speaker 2: industry analyst over at Bloomberg Intelligence. So this is a
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  Speaker 2: headline that Lisa talked to us about earlier in the
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  Speaker 2: morning and we were both like, hint, no, that's not
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  Speaker 2: for us. So apparently Uber strikes in a chord with
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  Speaker 2: GM Cruise in terms of Uber's going to have self
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  Speaker 2: driving cars roaming around. Do I want this in my life?
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  Speaker 3: Well, I think it's just a function of how technology
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  Speaker 3: gets rolled out.
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  Speaker 2: So that's a yes for Man Deep.
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  Speaker 4: Yes, Okay, he's a forward looking guy.
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  Speaker 3: We see that already in three cities in the US.
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  Speaker 3: San Francisco, Phoenix and you know La. And what Vemo
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  Speaker 3: has shown is they have the technology to have the
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  Speaker 3: car right on its own and even though the scale
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  Speaker 3: is very small, they're doing one hundred k rides per week.
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  Speaker 3: Compare that to Uber, which does ten billion rides in
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  Speaker 3: a year globally.
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  Speaker 4: Well, what kind of rides are we talking about.
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  Speaker 3: God, so Veimo compared to that is doing one hundred
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  Speaker 3: k rides of five million annually if you run rate that.
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  Speaker 3: But look, what they have shown is this is the future.
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  Speaker 3: And Uber is trying to figure out where they fit
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  Speaker 3: in this future because they don't have their own autonomous technology,
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  Speaker 3: so they have to partner with someone. It's not going
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  Speaker 3: to be Tesla. Tesla has told us they want to
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  Speaker 3: do right sharing via their own app. They don't want
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  Speaker 3: a ride sharing intermediary. They have the fleet, they have
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  Speaker 3: the software, they have the app. Why use somebody else's app.
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  Speaker 3: And in the case of Weveimo, even though they have
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  Speaker 3: a partnership with Uber, bulk of their rights are through
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  Speaker 3: their own app. So that's where Uber doesn't have a choice.
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  Speaker 3: It partners with Cruise Cruises. I mean in terms of
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  Speaker 3: the technology, I would say way behind Tesla and Vemo.
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  Speaker 3: But at the same time with Uber, like I said,
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  Speaker 3: they divested their own autonomous R and D division back
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  Speaker 3: during the pandemic, so they are not developing anything in house.
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  Speaker 3: And in this case, it's just a matter of getting
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  Speaker 3: what they have in the market.
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  Speaker 4: You know, my first reaction is like a hard no,
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  Speaker 4: I'm not getting to an autonomous vehicle. But I get
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  Speaker 4: into a vehicle every morning at four p thirty morning
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  Speaker 4: with some dude. I don't know.
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  Speaker 2: Yeah, we're just not the early adopters.
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  Speaker 4: It's all right, I mean, but what's better than the
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  Speaker 4: other I don't know. So how does Uber view?
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  Speaker 1: You know?
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  Speaker 4: The driver list technology is a long term net positive
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  Speaker 4: or I.
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  Speaker 3: Mean it's definitely a negative simply because Uber operates on
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  Speaker 3: an asset light model, and even then it struggled to
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  Speaker 3: reach profitability. Right now, it's at a point where they
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  Speaker 3: incremental margin is positive. What happens with the autonomous rights
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  Speaker 3: is the incremental margin goes much lower because one, you
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  Speaker 3: have to license the technology from somebody, in this case
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  Speaker 3: Cruise or Vemo, so you have to pay them. And
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  Speaker 3: then the take rates go down because the autonomous rides
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  Speaker 3: have a much different unit economics then ride with a driver,
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  Speaker 3: so instead of getting that thirty percent take rate, their
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  Speaker 3: take rate goes lower.
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  Speaker 2: But eventually don't the I guess that's not true. And
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  Speaker 2: to say eventually the money that they'd have to pay
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  Speaker 2: to say GM Cruise, does that decrease But no, it
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  Speaker 2: probably increases, right because GM's gonna want to get more
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  Speaker 2: for their PA exactly.
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  Speaker 3: So if you don't own the technology, why would a
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  Speaker 3: GM or a Wemo or Tesla want one more intermediary
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  Speaker 3: when they could do their own app with the fleet.
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  Speaker 3: So Uber has two choices, either they license the technology
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  Speaker 3: or they start buying the cars. And if they start
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  Speaker 3: buying the cars, it's not an asset model anymore. So
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  Speaker 3: they have to buy the cars from Tesla, buy the
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  Speaker 3: cars from Veimo and these are so yeah.
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  Speaker 4: Why then did they divest their R and D back
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  Speaker 4: in the pandemic? It seems like now I understand the
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  Speaker 4: long term. Oh that's a problem.
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  Speaker 3: Yeah it is. And back then they were under pressure.
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  Speaker 3: Remember when you went into the pandemic, all these companies
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  Speaker 3: had cash flow issues. They were burning cash every month.
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  Speaker 3: So the best option for them was to divest this
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  Speaker 3: raise cash. And you know, it was never part of
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  Speaker 3: their long term plans when it comes to developing this
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  Speaker 3: in house. And I think right now it's proving to
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  Speaker 3: be a wrong decision.
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  Speaker 2: So how then does Ruber If you're an investor and
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  Speaker 2: you're looking at Uber stock, how does that have to
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  Speaker 2: be re rated?
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  Speaker 5: Then?
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  Speaker 6: Longer term?
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  Speaker 2: Like short term forget it?
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  Speaker 3: So look at what we have now, Uber is still
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  Speaker 3: the scale player. I mentioned ten billion rides, and right
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  Speaker 3: now they are the ones who have the most supplied. Now,
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  Speaker 3: if this thing scales up very quickly, which I don't
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  Speaker 3: think anyone is betting on right now, that autonomous skills,
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  Speaker 3: there's a lot of skepticism around taking these rides, so
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  Speaker 3: this will be more graduate.
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  Speaker 2: Front and center, right there in front of you.
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  Speaker 3: Yeah. So in that case, I think Uber has more
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  Speaker 3: time on hand. Like nobody is thinking of a next
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  Speaker 3: twelve month scenario where Uber loses, you know, thirty percent
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  Speaker 3: of their volume. We're talking about a gradual shift towards autonomous,
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  Speaker 3: and in that case, Uber has more time to do
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  Speaker 3: these kind of partnerships. I think Cruise is one. They'll
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  Speaker 3: probably try to partner with Tesla, if that would be
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  Speaker 3: my guess, Even if it comes at the expense of
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  Speaker 3: gross margin, they'll take the hit because it's all about
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  Speaker 3: existence and you know, maintaining the platform.
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  Speaker 2: And yeah, all right, Mandy, we appreciate it. You here
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  Speaker 2: next week.
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  Speaker 5: Oh yeah.
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  Speaker 2: In video intelligence, in video has changed everyone's vacation schedule,
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  Speaker 2: Man deep saying joining us a senior technology analyst at Bloomberg.
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• 6:15
  Speaker 4: All right, Today's focus on munis is brought to you
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  Speaker 4: guest joins us Amanda Albright, municipal financi reporter for Bloomberg News,
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  Speaker 4: also formerly of the Daily tar Heel, which means she
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  Speaker 4: went to the University of North Carolina, which means somehow
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  Speaker 4: she got through my screen of no tar heels on
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  Speaker 4: this program. But she's pretty solid there man to talk
• 6:48
  Speaker 4: to us about the municipal bond market. You guys have
• 6:50
  Speaker 4: a lot of great stories out recently. The one that
• 6:52
  Speaker 4: really grabbed my attention is college's need up to one
• 6:56
  Speaker 4: trillion dollars of campus upgrades to lure students, and I
• 7:00
  Speaker 4: guess they're coming to the munis will bond market for that.
• 7:02
  Speaker 6: Yes, So Moody's put out this estimate that colleges and
• 7:07
  Speaker 6: universities might need seven hundred and fifty to nine hundred
• 7:11
  Speaker 6: and fifty billion of spending on infrastructure, facilities, dorms, classrooms
• 7:17
  Speaker 6: over the next decade in order to essentially stay competitive.
• 7:21
  Speaker 6: The interesting thing about that number is that only encompasses
• 7:24
  Speaker 6: their universe of credits that they rate, so the actual
• 7:28
  Speaker 6: number could be even higher. It was interesting this story
• 7:32
  Speaker 6: came out. Basically, the argument that Moody's is laying out
• 7:36
  Speaker 6: is that colleges need to have really pretty campuses in
• 7:39
  Speaker 6: order to attract customers, their students, and their students' parents
• 7:43
  Speaker 6: who want their kids to go to a really pretty
• 7:46
  Speaker 6: looking school and have kind of that pride. But interestingly enough,
• 7:51
  Speaker 6: after the story came out, I got some messages from
• 7:54
  Speaker 6: readers that disagreed with this premise and think that schools
• 7:57
  Speaker 6: need to focus on teaching students and providing a good
• 8:00
  Speaker 6: academic experience and they don't need to think about facilities.
• 8:04
  Speaker 6: So it's an interesting topic within higher ed and that
• 8:07
  Speaker 6: kind of balancing act that colleges are facing right now,
• 8:10
  Speaker 6: trying to invest in facilities, trying to lure students, but
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  Speaker 6: also keep cost low and focus on their core mission.
• 8:16
  Speaker 6: It's kind of one of those core debates in the
• 8:19
  Speaker 6: higher ed world at the moment.
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  Speaker 2: Well, also, isn't it true that, like the tuition, even
• 8:23
  Speaker 2: though tuition's insane and we're talking like eighty thousand dollars
• 8:26
  Speaker 2: like that doesn't cover at all necessarily one person's entire education.
• 8:30
  Speaker 6: There too, That's true. I think the interesting thing that
• 8:35
  Speaker 6: I think colleges will need to grapple with, and something
• 8:39
  Speaker 6: I'm interested in, is how much they kind of break
• 8:42
  Speaker 6: down those costs for future students. You know, how much
• 8:44
  Speaker 6: of tuition dollars are going to facilities. I think that's
• 8:48
  Speaker 6: an interesting question.
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  Speaker 4: All Right, more money going to universities, less money going
• 8:53
  Speaker 4: to municipal funded detention centers on feur inmates, what's going
• 8:58
  Speaker 4: on there?
• 8:59
  Speaker 6: Yeah, this is a classic political situation in the muni market.
• 9:06
  Speaker 6: We've seen with changes in political control, different approaches to
• 9:11
  Speaker 6: detentions and corrections policies, and so I think really that story,
• 9:16
  Speaker 6: which was a great story that came out I think
• 9:18
  Speaker 6: yesterday it highlights this growing risk that MUNI investor any
• 9:23
  Speaker 6: to talk to any MUNI investor right now, and politics
• 9:26
  Speaker 6: are at the forefront of everything, especially the presidential election.
• 9:31
  Speaker 6: The corporate tax rate could be in play, individual tax
• 9:35
  Speaker 6: rates could be in play. All of that will kind
• 9:37
  Speaker 6: of affect muni's and then you have all these other
• 9:40
  Speaker 6: kind I guess lower impacts as well, such as corrections,
• 9:45
  Speaker 6: projects like. All of that is very affected by politics.
• 9:48
  Speaker 6: So that's why MUNI investors are very focused on the
• 9:51
  Speaker 6: election these days, along with everyone else.
• 9:53
  Speaker 2: All right, Amanda, Yeah, everybody else, all right, Amanda, thanks
• 9:55
  Speaker 2: a lot. Amanda all Bright, Bloomberg Community finance reporter, joining
• 9:58
  Speaker 2: us from Kansas.
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• 10:16
  Speaker 4: I'm looking at the screen, lots of things moving all
• 10:18
  Speaker 4: over the place. Stocks up, yields down. I'm looking at
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  Speaker 4: gold up one and a quarter percent, oil up one
• 10:25
  Speaker 4: point nine percent on wtacrude oil. Is there a correlation there?
• 10:28
  Speaker 4: I think our next guest has some thoughts on that.
• 10:30
  Speaker 4: Mike McLoone, senior commodity strategist for Bloomberg Intelligence, zooming in
• 10:34
  Speaker 4: from Miami, Florida. Mike, what's going on with gold and crude?
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  Speaker 5: Paul, Hello.
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  Speaker 7: We have the difference between an enduring bull market that's
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  Speaker 7: gold right now it said if you end the week
• 10:44
  Speaker 7: the month now, it's at a record high, and an
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  Speaker 7: enduring bear market that's Crudeill The price in the screen
• 10:49
  Speaker 7: you see right now WTI seventy four dollars a barrow
• 10:51
  Speaker 7: about there was first traded in two thousand and six.
• 10:54
  Speaker 7: That's almost twenty years ago. And as we tilt towards
• 10:57
  Speaker 7: this easing cycle, kipically that spread with gold outperforming Crudeli
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  Speaker 7: widens and it looks like it's just getting started.
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  Speaker 2: First of all, you bury the lead. We're not coming
• 11:08
  Speaker 2: to Miami, Mike, so you can you can stop looking
• 11:11
  Speaker 2: for fun things for us to do. You cannot worry
• 11:14
  Speaker 2: about your guest rooms like we're good. So the record
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  Speaker 2: high though that we saw back in gold, that we
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  Speaker 2: keep hitting here, I'm really struggling as to what is
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  Speaker 2: actually leading it, because you know, the last ten years
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  Speaker 2: and we had low rates and all that gold did
• 11:27
  Speaker 2: a whole lot of nothing, and it has just been
• 11:30
  Speaker 2: feeling like a NonStop tear in the last few years.
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  Speaker 5: Yeah, let's start with two things.
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  Speaker 7: The unstoppable rise in US debt to GDP, the very
• 11:40
  Speaker 7: expensive US stock market, the Federal Reserve tilting towards easing.
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  Speaker 7: And the most significant outfit in the room is the
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  Speaker 7: unlimited friendship between President Zy and President Putin that shifted
• 11:50
  Speaker 7: the world order in favor of gold. And it looks
• 11:53
  Speaker 7: like it's yourself and so the biggest deepest pockets on
• 11:55
  Speaker 7: that planet I starting with China, have been buying the metal.
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  Speaker 7: And it looks like once we get a little bit
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  Speaker 7: of a version in lower yields i e. T Bills
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  Speaker 7: not at five percent anymore, and maybe just a little
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  Speaker 7: back and fill in the stock market, gold will shine.
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  Speaker 5: It looks like it's continuing to that now. Right now,
• 12:09
  Speaker 5: it's a little bit overdone.
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  Speaker 7: Manage money net positions IE futures are really long for
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  Speaker 7: a reason. It's a bull market. But the narrative for
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  Speaker 7: gold is quite strong. And I'll just meant and with
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  Speaker 7: is gold is historically very cheap versus SEP five hundred.
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  Speaker 7: If you just take it divided by the ounces divided
• 12:24
  Speaker 7: by the index, particularly when you enter recessions. What oftentimes
• 12:27
  Speaker 7: happens when you enter recession and fetis is that that
• 12:30
  Speaker 7: spread just kind of narrows a little bit.
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  Speaker 4: What would take what would change this seems to be
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  Speaker 4: a structural bullish call on gold. Mike, what would need
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  Speaker 4: to change that?
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  Speaker 7: I think the first thing is the US stock markets
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  Speaker 7: stay resilient. Well, why by golden when it's that resilient.
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  Speaker 7: The most significant thing was kind of some kind of
• 12:48
  Speaker 7: unexpected dayton ie President Zy picking up the phone saying yeah,
• 12:52
  Speaker 7: we're done with this unlimited friendship. The dayton that's happening
• 12:55
  Speaker 7: globally is part of what's really driving gold. He's somewhat
• 12:58
  Speaker 7: getting away from the dollar, looking for an altern to
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  Speaker 7: US treasuries, particularly with yields dropping and the death the
• 13:04
  Speaker 7: GDP just continuing to rise, So that to me would
• 13:07
  Speaker 7: be in one of the most significant things. Otherwise, it
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  Speaker 7: looks to me, once you get a little bit of
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  Speaker 7: a version lower in the stock market, which at some
• 13:13
  Speaker 7: point will happen, gold will probably shine like long bonds,
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  Speaker 7: like on the month, now on the quarter. Now, gold's
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  Speaker 7: up about eight percent in the US Treasury. The Bloomberg
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  Speaker 7: twenty plus long bond indexes up about the same, about
• 13:24
  Speaker 7: eight percent.
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  Speaker 2: What about positioning at this point, Like I know in
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  Speaker 2: the central banks are buyers, et cetera, and that in
• 13:29
  Speaker 2: price spikes, you're not going to see a lot of
• 13:31
  Speaker 2: physical buying also, et cetera. But who's left to buy
• 13:34
  Speaker 2: in the futures market.
• 13:36
  Speaker 5: It's that's the key thing. It's a good point.
• 13:38
  Speaker 7: About forty four percent of total co mix futures positions
• 13:41
  Speaker 7: are speculative longs.
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  Speaker 5: It's very high.
• 13:44
  Speaker 7: The high it really gets much higher than forty eight.
• 13:46
  Speaker 7: But what's really happening is we've had significant outflows in
• 13:49
  Speaker 7: gold dtfs since that peak in twenty twenty. They're just
• 13:52
  Speaker 7: starting turned inflows and I think that is part of
• 13:54
  Speaker 7: that alternative. You see people going to cash and bonds.
• 13:57
  Speaker 7: They're looking for alternatives to expensive stock market. So that
• 13:59
  Speaker 7: looks it's just rolling over. But if you got a
• 14:01
  Speaker 7: day like we had in August fifth, when markets go down, yeah,
• 14:04
  Speaker 7: you hit you sell what you can. And there's a
• 14:06
  Speaker 7: lot of specative lungs in goal at the moment for
• 14:08
  Speaker 7: a good reason. Though it's a bull market.
• 14:10
  Speaker 4: That's a trader's term. You sell what you can. Yeah,
• 14:12
  Speaker 4: you have on those days. Hey, Mike, thanks so much
• 14:14
  Speaker 4: for joining us. I appreciate it very much. As always,
• 14:17
  Speaker 4: Mike mcloone's Cedar Commodity Strategists for Bloomberg Intelligence, I'm looking
• 14:21
  Speaker 4: at like some of the Whenever you talk to Mike,
• 14:23
  Speaker 4: I put up g LCO the Global Commodity Price screen.
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• 14:50
  Speaker 2: So let's get to the markets here. Equities rally, you
• 14:52
  Speaker 2: haven't been to the bond market, and the dollars lower.
• 14:54
  Speaker 2: It's classic.
• 14:55
  Speaker 5: The Fed is going to cut.
• 14:56
  Speaker 2: I guess the question is by how much? And then
• 14:58
  Speaker 2: how does that affect your positioning? And the why they're
• 15:00
  Speaker 2: cutting too very much important. Dana Duoria, Co, Chief Investment
• 15:04
  Speaker 2: Officer of Investment joins us. Now, Dana, how did you
• 15:08
  Speaker 2: view the jackson Hole speech by Powell? Was that twenty
• 15:11
  Speaker 2: five cuts for you in September or was that fifty.
• 15:13
  Speaker 8: I think it's twenty five. Look, I think that you
• 15:16
  Speaker 8: could not ask for more dubvish comments from Powell this week.
• 15:20
  Speaker 8: You know, I think he knew that the market needed
• 15:23
  Speaker 8: to hear something like that in order not to react negatively.
• 15:25
  Speaker 8: We've obviously been pricing in significant it decreases, and so
• 15:31
  Speaker 8: he delivered, right, and he gave us a speech that
• 15:33
  Speaker 8: said yep, I'm there, you know, I think, and even
• 15:36
  Speaker 8: words like ensuring that inflation is anchored. You know, it
• 15:39
  Speaker 8: was not only a dubbish speech. It was sort of
• 15:41
  Speaker 8: a victory lap, right for him to say, Hey, our
• 15:44
  Speaker 8: monetary policy worked out, We've tamed inflation. Now it's time
• 15:48
  Speaker 8: to turn to unemployment and we are going to cut.
• 15:50
  Speaker 8: But I don't think that means, you know, all that
• 15:53
  Speaker 8: excitement means that were necessarily getting fifty. I think it's
• 15:56
  Speaker 8: his way of saying, you know, yes we can all
• 16:00
  Speaker 8: the sigh of relief. I think he still gives himself
• 16:02
  Speaker 8: the twenty five In September.
• 16:04
  Speaker 4: Hey, Dana, just looking at the price action today, the
• 16:06
  Speaker 4: russell is up three point three percent versus a one
• 16:09
  Speaker 4: percent for the S and P five hundred. So I
• 16:12
  Speaker 4: guess that rotation trade into maybe smaller mid cap stocks
• 16:17
  Speaker 4: out of you know, some of the other big cap names.
• 16:20
  Speaker 4: Maybe that's really a thing. How do you guys think
• 16:22
  Speaker 4: about that?
• 16:23
  Speaker 8: Yeah, look, I mean, obviously small caps more interest rates sensitive,
• 16:27
  Speaker 8: and you know, this is great news. And certainly as
• 16:30
  Speaker 8: you go into an interest rate reducing cycle, you know
• 16:34
  Speaker 8: you're you're looking at benefits to small caps. You're looking
• 16:37
  Speaker 8: at benefits obviously in the real estate sector already somewhat
• 16:42
  Speaker 8: expecting that and pricing that in. So not surprising to
• 16:45
  Speaker 8: see that, you know, and then you mentioned even in
• 16:48
  Speaker 8: your intro, but what is the reason.
• 16:50
  Speaker 2: We expect the cuts?
• 16:51
  Speaker 8: I think if you think that cuts are happening because
• 16:54
  Speaker 8: you know, the feed is a little bit worried about
• 16:56
  Speaker 8: what's going on in the economy, that's not good news
• 16:59
  Speaker 8: for small caps.
• 16:59
  Speaker 5: Right.
• 17:00
  Speaker 8: It's short term good news, but it's not good news.
• 17:02
  Speaker 8: You know, if you think you're looking at recession, if
• 17:05
  Speaker 8: you think that the FED is playing this right, they're
• 17:08
  Speaker 8: hitting the ball right down the middle. They've tamed inflation,
• 17:11
  Speaker 8: and now they're going to prevent problems in the economy.
• 17:15
  Speaker 8: Great news for small caps.
• 17:17
  Speaker 2: I guess the question, though, becomes do they wind up
• 17:20
  Speaker 2: cutting because there is a recession. And that's kind of
• 17:22
  Speaker 2: the unknowable because if they're cutting for that elusive soft
• 17:26
  Speaker 2: landing or normalization, that shouldn't that be a different distribution
• 17:31
  Speaker 2: of investment than if you are cutting because things are bad.
• 17:35
  Speaker 8: Yes, yeah, it would be. I mean, look a high
• 17:38
  Speaker 8: level we advocate strategic, long term, diversified thinking. Don't try
• 17:43
  Speaker 8: to time this.
• 17:44
  Speaker 5: You know.
• 17:44
  Speaker 8: That said, if you're thinking about tilting in a certain
• 17:48
  Speaker 8: direction based on one of those outcomes to the other.
• 17:51
  Speaker 8: You know, if you think recession's coming, you're tilting towards quality, right,
• 17:54
  Speaker 8: you're tilting towards low volatility stocks stacks that sort of
• 17:57
  Speaker 8: act as a ballast in bad weather. If you think
• 18:01
  Speaker 8: that the FED is getting this right, that they are
• 18:04
  Speaker 8: cutting in time, that they're not late with this, that
• 18:07
  Speaker 8: they're pivoting at exactly the right moment, that we are
• 18:10
  Speaker 8: going to avert, you know, a problem with this the
• 18:12
  Speaker 8: AI trade. Maybe maybe your thesis is the AI trade is,
• 18:15
  Speaker 8: you know, full steam ahead, and we're even going to
• 18:17
  Speaker 8: start to see productivity increases in the rest of the economy.
• 18:21
  Speaker 6: Then you know, areas like.
• 18:22
  Speaker 8: Small in value where they've been they've been kind of
• 18:25
  Speaker 8: ignored from evaluation perspective, they look a lot more attractive.
• 18:30
  Speaker 8: You're going to be leaning more heavily there, all.
• 18:33
  Speaker 4: Right, Dannis, So today's price action shows us that obviously
• 18:36
  Speaker 4: the Fed still matters, The market cares what the Fed
• 18:38
  Speaker 4: is going to do. But so to earnings, and we
• 18:40
  Speaker 4: just kind of finished up in earnings cycle here, any
• 18:43
  Speaker 4: takeaways for you that maybe influence the way you're thinking
• 18:47
  Speaker 4: about opportunities.
• 18:49
  Speaker 8: Yeah, Look, earnings are cooperating, right, Earnings are in the
• 18:51
  Speaker 8: plus category here. We've had a nice earning season. You know,
• 18:55
  Speaker 8: combined S and P five hundred, earnings grew nearly eleven
• 18:58
  Speaker 8: percent year every year. At this point, we do having
• 19:00
  Speaker 8: VideA still to see obviously, the AI king, we want
• 19:03
  Speaker 8: to see where that's going to go. That's going to
• 19:05
  Speaker 8: be meaningful for the market, potentially even on the same
• 19:08
  Speaker 8: level as today, right to the extent that AI has
• 19:11
  Speaker 8: been driving a lot of the market's valuation increases, the
• 19:14
  Speaker 8: multiples that we're seeing in a big you know that
• 19:16
  Speaker 8: big tech, heavy concentrated part of the market, communications and tech,
• 19:21
  Speaker 8: so that that's going to be very important. But certainly
• 19:24
  Speaker 8: what's nice to see about you know, earnings right now
• 19:27
  Speaker 8: is that with nearly eighty percent of the companies beating
• 19:30
  Speaker 8: their expectations, and most of the sector is doing well,
• 19:34
  Speaker 8: you know, sectors like financials. This is good, you know,
• 19:37
  Speaker 8: it shows breadth, right, it's not just earnings coming from
• 19:40
  Speaker 8: that concentrated part of the market that's highly valued.
• 19:43
  Speaker 2: So I'm glad you brought that up because I feel
• 19:44
  Speaker 2: like I've been asking this question ad nauseum, which is
• 19:46
  Speaker 2: is in video going to be a market event or
• 19:48
  Speaker 2: is it going to be a mag seven slash chip
• 19:51
  Speaker 2: stock event? Where do you fall on that?
• 19:55
  Speaker 8: I think it's going to matter, you know, because of
• 19:58
  Speaker 8: course we already do have the news now from Powell,
• 20:02
  Speaker 8: and obviously, notwithstanding we've got a month before these cuts
• 20:04
  Speaker 8: actually take place, and that's a lot of time for
• 20:06
  Speaker 8: data to shift one way or the other. But it's
• 20:09
  Speaker 8: pretty well baked in that. You know, we get the
• 20:11
  Speaker 8: twenty five in September, so the market's pricing that in.
• 20:13
  Speaker 8: And now the question does become, you know, where where
• 20:16
  Speaker 8: goes in Vidia has gone, you know, to a certain extent,
• 20:20
  Speaker 8: belief in the AI trade. Of course, we know that
• 20:22
  Speaker 8: there's a whole you know, satellite system of companies around
• 20:25
  Speaker 8: there that are AI driven and you know, carry the
• 20:29
  Speaker 8: flag for AI. But let's face it, in Vidia is
• 20:33
  Speaker 8: the market sort of bell weather for that. And I
• 20:35
  Speaker 8: think that does matter a lot, because again, a lot
• 20:38
  Speaker 8: of the valuation increases we see on the large cap
• 20:41
  Speaker 8: side in that growth space are around.
• 20:43
  Speaker 3: This thesis, Dana.
• 20:45
  Speaker 4: On the fixed income side, where do you see opportunity?
• 20:49
  Speaker 8: You know, of course, obviously the expectation now with the
• 20:53
  Speaker 8: FED decreasing rates and you start to see some movement there,
• 20:57
  Speaker 8: I remain I am and remain you know, a candidate
• 21:01
  Speaker 8: for just diversity across the yield curve. I don't think
• 21:05
  Speaker 8: it's smart for the average person to be betting on
• 21:07
  Speaker 8: interest rate cuts. I think, you know, the market is
• 21:10
  Speaker 8: pricing in the interest rate cuts as quickly as they're
• 21:12
  Speaker 8: pricing in you know, equity changes. So if you're in
• 21:14
  Speaker 8: the retail advisor area where we exist, you know, tilting
• 21:19
  Speaker 8: one way or the other on interest rates is a
• 21:22
  Speaker 8: thing to is a tough thing to do.
• 21:24
  Speaker 3: It's not just right the FED.
• 21:25
  Speaker 8: When you think of something like the ten year rate,
• 21:26
  Speaker 8: which obviously we're all watching now, there's a lot that
• 21:29
  Speaker 8: goes into that rate. You know, it's not it's not
• 21:31
  Speaker 8: just the Fed. It's the it's the markets expectations about
• 21:34
  Speaker 8: where the economy is going, how much growth are we're
• 21:37
  Speaker 8: going to see in the mid term. So I say,
• 21:40
  Speaker 8: you know, make sure you're diverse fied across the field curve.
• 21:42
  Speaker 8: I don't even think of bar Bell. I think, you know,
• 21:45
  Speaker 8: trying to get across the yield curve is the right
• 21:47
  Speaker 8: place to be.
• 21:47
  Speaker 2: All right, Dan, And we really appreciate thanks for jumping
• 21:49
  Speaker 2: on on this Friday, and next week definitely going to
• 21:51
  Speaker 2: be a busy week as well. Dana Dyuoria a co
• 21:54
  Speaker 2: Chief investment Officer at Investment.
• 21:56
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