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Markets, Healthcare, And The Supply Chain · 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
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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
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Speaker 1: called Apple Podcasts or wherever you listen to podcasts, and
0:18
Speaker 1: at Bloomberg dot com slash podcast SMP five at eighty.
0:24
Speaker 1: That is a correction, territory, kids, and that's what a
0:27
Speaker 1: lot of investors have been kind of expecting for a
0:31
Speaker 1: while here, and a lot of folks are even saying
0:33
Speaker 1: it's a healthy part of a longer term bull market.
0:37
Speaker 1: Let's check in with a professional and get a professional opinion.
0:41
Speaker 1: Katie Nixon, ce IO Wealth Management for Northern Trust. So, Katie, hey,
0:45
Speaker 1: thanks so much for being with us. We really appreciate
0:47
Speaker 1: the time. We are in a correction on the SMP.
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Speaker 1: What do you make of it? Yes, good morning, and
0:55
Speaker 1: yes it's time for investors to buckle up. But I
0:57
Speaker 1: do think to your earlier point, this is to be
0:59
Speaker 1: a expected five percent corrections. Ten percent corrections are normal
1:04
Speaker 1: parts of market cycles, and the fact that this correction
1:07
Speaker 1: is taking place during a period of relatively strong economic growth,
1:11
Speaker 1: low unemployment, the backdrop is healthy. So our view is
1:15
Speaker 1: that it will be sort of a short term correction,
1:17
Speaker 1: but something that investors are going to perhaps have to
1:19
Speaker 1: have to live with for the next several weeks or
1:21
Speaker 1: even months. I guess the you know, the economic picture
1:23
Speaker 1: looks good, especially um the historical economic outlook and low
1:28
Speaker 1: unemployment is great, but inflation doesn't look so good. What
1:33
Speaker 1: do you think about seven? How do you expect this
1:35
Speaker 1: year to play out? Yeah, so, I mean that that
1:39
Speaker 1: is the big question, and I think that's been the
1:41
Speaker 1: biggest issue for investors insofar as the outlook for inflation
1:45
Speaker 1: influences your outlook for what the ben's going to do.
1:47
Speaker 1: Our all look for inflation is, yes, it's very high.
1:50
Speaker 1: It's been higher for longer than we thought it would be. Um,
1:53
Speaker 1: the various cycles of the COVID pandemic have certainly not helped,
1:56
Speaker 1: and we see continued strains and supply chains and things
1:59
Speaker 1: like that. So inflation has higher for longer, but we
2:01
Speaker 1: do see it coming off the boil as we as
2:03
Speaker 1: we enter the second half of two. And it's a
2:06
Speaker 1: combination of some very obvious things like just the base
2:10
Speaker 1: effects as we get past the very high levels of
2:12
Speaker 1: inflation that we saw, and then an energy prices coming
2:16
Speaker 1: back down as we head towards the summer and into
2:18
Speaker 1: the fall. So we think inflation will trend down. It
2:21
Speaker 1: will still stay stay elevated above the two percent target,
2:25
Speaker 1: but it certainly won't be printing seven percent like we've
2:27
Speaker 1: seen recently. And because of that, and the important thing
2:30
Speaker 1: for investors is because of that, we don't have an
2:33
Speaker 1: aggressive sed call here either. We think the market is
2:35
Speaker 1: probably a little bit ahead of itself anticipating for rate
2:38
Speaker 1: hikes or even I read this morning summer anticipating fifty
2:41
Speaker 1: basis point hiking in March, and we think that's a
2:44
Speaker 1: bridge too far. So, Katie, you know, I'm looking at
2:48
Speaker 1: some of the big movers today, you know, Netflix off
2:50
Speaker 1: ten percent, Tesla off seven eight percent. How do you
2:55
Speaker 1: think about the sectors that you want to have exposure
2:58
Speaker 1: to in twenty twenty two in what is in fact
3:02
Speaker 1: a rising interest rate environment. So that is a great question,
3:07
Speaker 1: and I think it's a very important question for investors
3:10
Speaker 1: to answer because what we've seen sort of coming out
3:13
Speaker 1: of the pandemic is a preference for these high growth stocks.
3:18
Speaker 1: Right you wanted to be involved in the reopening trade.
3:20
Speaker 1: And Netflix and Peloton and these these stocks are sort
3:23
Speaker 1: of very obvious uh stories um COVID related stories and
3:28
Speaker 1: and and also very strong results backing up investors enthusiasm.
3:32
Speaker 1: What has been under owned though really historically, but even
3:36
Speaker 1: post COVID is value. UM. So what we're telling our
3:40
Speaker 1: clients is you really want to strike that balance and
3:42
Speaker 1: and look at your portfolio see where you're under invested in.
3:45
Speaker 1: Most of the time that's value and value to mean
3:48
Speaker 1: US value stocks, but it can also mean non US stocks.
3:51
Speaker 1: European stocks tend to skew towards the value end of
3:55
Speaker 1: of the spectrum. UM. So we are telling our clients
3:58
Speaker 1: go global and diversify and really strike the balance between
4:02
Speaker 1: growth and value because that you're probably under under invested
4:04
Speaker 1: in value. What about US stocks? I mean, I'm watching
4:09
Speaker 1: a live ticker of the SMP now down two points
4:11
Speaker 1: seven per cent um. We've we've started the year so poorly.
4:17
Speaker 1: Is this a buying opportunity or do you want to
4:18
Speaker 1: wait it out? Since it took so long, I mean,
4:21
Speaker 1: since it didn't take so long, since it was so fast,
4:24
Speaker 1: it happened pretty fast. I mean it's just like the
4:26
Speaker 1: blink of an eye that we were back. We were
4:28
Speaker 1: at the highs in early January. So yes, it happened
4:30
Speaker 1: quite quickly. And you know that that that that tends
4:32
Speaker 1: to be in an historical pattern. You know, the the
4:35
Speaker 1: market takes the escalator up in the elevator down, as
4:38
Speaker 1: they say, and we certainly have seen that. I wouldn't
4:40
Speaker 1: really encourage investors not to try to time the market here. Um.
4:45
Speaker 1: It's so interesting. Investors always say that they want to
4:48
Speaker 1: buy the dips, but then when you have a dip
4:49
Speaker 1: like we're seeing we've seen the last couple of weeks,
4:51
Speaker 1: then especially today, investors are afraid to get in. So
4:55
Speaker 1: you have to fight your emotions state with your strategic plan.
4:58
Speaker 1: Make sure that your investments are aligned with your financial goals.
5:01
Speaker 1: And that might mean buying in a dip, it could
5:03
Speaker 1: mean selling into a dip. Um. It all really depends
5:05
Speaker 1: on what your specific and unique goals are and focus
5:08
Speaker 1: on that because you're not going to be able to
5:10
Speaker 1: predict the market moves and you're not gonna be able
5:12
Speaker 1: to control the market moves, um, So better to just
5:15
Speaker 1: focus on what you know, which is what do you
5:16
Speaker 1: need your assets to do for you and how can
5:19
Speaker 1: you position them for the best best long term success. Canny,
5:23
Speaker 1: think about global energy here, are you a buyer. We've
5:26
Speaker 1: got oil. It's off a little bit today, as everything is,
5:29
Speaker 1: but generally oil has been had a nice run up here.
5:33
Speaker 1: We do like it, and you know, we love natural
5:35
Speaker 1: resources as as sort of a one to tail went
5:38
Speaker 1: for portfolios. Number one, you get that equity beta and
5:41
Speaker 1: as I said earlier, we're positive on equities. Um, we're
5:44
Speaker 1: constructive on US equities in particular. So with that as
5:47
Speaker 1: a as a backdrop, we like energy stocks. And the
5:50
Speaker 1: second thing is, as I mentioned before, inflation are we
5:53
Speaker 1: anticipate coming off the boil in the second half, but
5:56
Speaker 1: the risk is that we're wrong, and if we are
5:59
Speaker 1: in a much more persistent inflationary environment, you do tend
6:02
Speaker 1: to get good inflation protection out of natural resource equities,
6:06
Speaker 1: So we like those as part of a diversified portfolio.
6:09
Speaker 1: Katie Nixon, thank you so much for joining us. We
6:11
Speaker 1: really appreciate getting your thoughts, getting your perspective. Katie Nixon,
6:15
Speaker 1: she's a c I O of wealth management at Northern
6:18
Speaker 1: Trust's Northern Trust. They're based in Chicago, and I'll tell
6:22
Speaker 1: you they're one of the good long term deep money
6:27
Speaker 1: managers out there in the Midwest. When you've got to Chicago,
6:29
Speaker 1: you have to get a meeting to get It's unbelievable
6:36
Speaker 1: take on this market, for sure, especially as we bounce
6:40
Speaker 1: a little bit back higher. Right now, we're UM down
6:43
Speaker 1: two point three percent little less so UM we have
6:47
Speaker 1: had a rough morning today, but it is still deeply,
6:51
Speaker 1: deeply in the red. Now I want to get to
6:58
Speaker 1: well coast. I'll say. He is the CEO and founder
7:01
Speaker 1: of Biotricity, and they UM are trying to improve healthcare
7:08
Speaker 1: by developing basically digital solutions aiding a chronic disease prevention
7:12
Speaker 1: and management while cost You know, I was thinking about
7:14
Speaker 1: your company and you can uh tell us more about it,
7:18
Speaker 1: I guess in your answer, but it daught on me. Um.
7:21
Speaker 1: I've always had this kind of negative view of the
7:24
Speaker 1: metaverse or a future living in virtual reality UM from
7:30
Speaker 1: movies like Wally and Uh and Uh what's that one
7:34
Speaker 1: with Bruce Willis where he UM plays a cop in
7:38
Speaker 1: the metaverse. In any case, I always have thought it
7:41
Speaker 1: would be unhealthy. But now that I'm thinking about your country,
7:44
Speaker 1: your company, it seems like it could be healthier living
7:48
Speaker 1: in the metaverse. What do you think? No, it's a
7:51
Speaker 1: it's an excellent point. Um. I I always thought about
7:54
Speaker 1: that myself in terms of, you know, getting so connected
7:57
Speaker 1: and being completely integrated, and then how do we how
8:00
Speaker 1: do we take care of ourselves if we're you know,
8:02
Speaker 1: sipping smoothies and and doing all of that, and uh,
8:05
Speaker 1: you know, I think that as we've seen through the pandemic,
8:10
Speaker 1: people have gotten a lot more engaged. I mean the
8:11
Speaker 1: direction was already there. We were getting into more connected healthcare,
8:15
Speaker 1: but there was an unwillingness from individuals to engage, read
8:19
Speaker 1: instructions and figure that out, and that got all accelerated.
8:22
Speaker 1: So I really think that as long as we as
8:24
Speaker 1: a as, uh you know, individuals as companies continue to
8:28
Speaker 1: innovate on this idea of digital tracking home based labs,
8:33
Speaker 1: but make sure that it's clinically relevant, like it's actually
8:36
Speaker 1: not lifestyle but really rooted and based on good science,
8:41
Speaker 1: then we can actually get that insight. And I think
8:43
Speaker 1: that the consumption of care, for for basic episodic visits,
8:47
Speaker 1: for general care is going to happen more and more
8:50
Speaker 1: in the home where individuals are engaged. And then they're
8:53
Speaker 1: going to go in for treatment, um, into the into
8:57
Speaker 1: the providers or into the hospital. So first of all
8:59
Speaker 1: them Bruce Willis movie, I was thinking of a Surrogates
9:02
Speaker 1: but in this and while you know, um, we didn't
9:06
Speaker 1: do anything. People in those movies and those fictional uh
9:09
Speaker 1: you know future forecast did nothing. And you're right. During
9:11
Speaker 1: the pandemic, people did a lot more. Paul for example,
9:14
Speaker 1: got a Peloton bike and was riding every day. Um.
9:17
Speaker 1: A lot of people were doing trying to figure out
9:19
Speaker 1: ways to do exercise and ended up doing even more
9:22
Speaker 1: in lockdown than they would have before. But what kind
9:25
Speaker 1: of solutions are you able to provide now walks in
9:29
Speaker 1: terms of for example, health monitoring solutions. What what can
9:33
Speaker 1: biotricity give us? Great questions. So you know, we started
9:39
Speaker 1: out we had the diagnostic product which was really available
9:42
Speaker 1: for high risk of patents and so and when I
9:45
Speaker 1: talk about high risk pations, I'm talking about patients that
9:47
Speaker 1: can have a heart attack or stroke. Uh. And you
9:49
Speaker 1: don't want them basically sitting at home, uh, waiting for
9:53
Speaker 1: the data to be collected and then returned back and
9:55
Speaker 1: downloaded because you're worried about something is going to happen.
9:57
Speaker 1: So that was our first product, and it's a smart
9:59
Speaker 1: to ice and so when you put it onto a
10:01
Speaker 1: patient and you send them home, UH, it'll it'll look
10:04
Speaker 1: for the data and when it detects an emergence here
10:06
Speaker 1: and anomaly, it actually alerts your doctrine gets you back
10:10
Speaker 1: into the hospital. It's like a bracelet or a wearable
10:13
Speaker 1: that detects like it doesn't e c G and detect
10:16
Speaker 1: your pulse and correct. It's a small little advice of
10:20
Speaker 1: of a mouse and it hangs around your neck and
10:22
Speaker 1: and and and makes contact with your skin. And that
10:25
Speaker 1: device uh saves lives every day. And then we've taken
10:29
Speaker 1: that technology and we've simplified it in two products, one
10:32
Speaker 1: which was just FC cleared last week, which is a
10:36
Speaker 1: patch that gets connected and collects your ECG uh and
10:39
Speaker 1: and accelerates and your your diagnostic response time. So it's
10:44
Speaker 1: a halter product but slightly highly condensed. And then we
10:48
Speaker 1: have a consumer product which is collecting your your e
10:51
Speaker 1: c G long term for weeks, months, years, as long
10:55
Speaker 1: as you're wearing it. And this is really good for bikes, bikers,
10:58
Speaker 1: is really good for individuals who had an issue but
11:01
Speaker 1: they're fine, now, but they want to track themselves. Uh,
11:05
Speaker 1: really a lifestyle play. So is this you know, I
11:08
Speaker 1: guess the digitization, if you will, of healthcare, is that
11:12
Speaker 1: going to drive costs down? It doesn't every other industry.
11:15
Speaker 1: Good point, now, excellent questions. So I would say, you know,
11:20
Speaker 1: seventy cents of every dollar in the United States is
11:24
Speaker 1: spent on chronic conditions. And so we've been seeing a
11:27
Speaker 1: huge movement in telemedicine, right, But telemedicine is episodic care.
11:32
Speaker 1: It's thirty cents on the dollar. So the real issue
11:35
Speaker 1: is exactly what you're talking about, right. The people who
11:37
Speaker 1: are sitting at home, they're not exercising, they're not engaging.
11:40
Speaker 1: They have to go in and out of the doctor's
11:42
Speaker 1: hospital all the time, people with cardiac issues, people who
11:45
Speaker 1: were servicing at biotric City, and we're focused on and
11:48
Speaker 1: the reason is most of these individuals don't actually have
11:51
Speaker 1: technology available to them to get insight. So they get
11:55
Speaker 1: really on it. The doctor says, you're you know, this
11:58
Speaker 1: is gonna be a problem. You really have to do this,
12:00
Speaker 1: and for a week or two weeks the self manage.
12:03
Speaker 1: But because they have no data, they have no device,
12:05
Speaker 1: they have no technology to tell them that there it's
12:07
Speaker 1: actually doing something. They drop off the wagon and that's
12:11
Speaker 1: what we're doing. And and to your point, I think
12:13
Speaker 1: that's really going to drive cost downs. But we need
12:16
Speaker 1: to continue this trend. So is is this the again
12:22
Speaker 1: kind of some of the telemedicine. Is that just a
12:25
Speaker 1: function of the pandemic or is this a big trend
12:27
Speaker 1: that's going to continue. So I think telemedicine is going
12:31
Speaker 1: to get bifurcated. So part of it is going to stay.
12:34
Speaker 1: So you know, the people who have a fluid that
12:36
Speaker 1: it's convenient and whatnot, but I think there'll be a
12:39
Speaker 1: drop there and then they're going to be telemedicine for
12:42
Speaker 1: chronic patients. The problem with chronic patients is, you know,
12:46
Speaker 1: you need blood work, you need diagnostics, you need an
12:49
Speaker 1: actual test. I mean you cannot tell a cardiac patient,
12:53
Speaker 1: I you know, are you actually having a rhythmia or
12:55
Speaker 1: not if you're feeling complications without running some sort of test.
12:59
Speaker 1: And that's a companies like us have to continue to
13:02
Speaker 1: innovate and provide those technologies so that you can get
13:05
Speaker 1: that data integrated with telemedicine and provide here. And that's
13:08
Speaker 1: that seventy cents I'm talking about. All right, that's what's
13:11
Speaker 1: going to move the needle. All right, will cause, thank
13:13
Speaker 1: you so much. We appreciate a walk us all Sadiq,
13:15
Speaker 1: CEO and founder of Biotricity talking about the future of medicine.
13:22
Speaker 1: You know, one of the key topics that Matt and
13:24
Speaker 1: I like to stay on top of is the global
13:27
Speaker 1: supply chain challenges out there. Uh, and they are in
13:31
Speaker 1: fact global and the impact all of us really in
13:33
Speaker 1: so many different ways, from going to the supermarket to
13:37
Speaker 1: going to the card dealer, lots of ways to experience
13:42
Speaker 1: the challenges facing the global supply chain. And we have
13:45
Speaker 1: a great voice to help us get a sense of
13:47
Speaker 1: what's going on out there. That is Geene Sharroka, Executive
13:50
Speaker 1: Director of the Port of Los Angeles. And again on
13:53
Speaker 1: my Bloomberg screen, one of my many Bloomberg screens in
13:56
Speaker 1: front of me, I have map Go and I'm looking
13:58
Speaker 1: at the uh uh you know, all the ships that
14:00
Speaker 1: are at sea and kind of where they're kind of
14:02
Speaker 1: anchored and uh, certainly the Port of Los Angeles is
14:05
Speaker 1: um the busiest container port in North America. So this
14:09
Speaker 1: is a great opportunity. Gene, thanks so much for joining us.
14:12
Speaker 1: I know you're super busy, you and all your folks
14:14
Speaker 1: there at the port here. Uh since the last time
14:17
Speaker 1: we spoke to you, I would say probably you know,
14:19
Speaker 1: three or four weeks ago. Give us a sense of
14:21
Speaker 1: kind of where we are as a nation in terms
14:24
Speaker 1: of our supply chain logistics. Well, good morning, Paul and Matt,
14:29
Speaker 1: and thanks for having me back on. Since we last
14:32
Speaker 1: spoke when I visited New York in December, we have
14:35
Speaker 1: seen some improvement. Overall, imports on the docks in Los
14:39
Speaker 1: Angeles have been cut by half meeting. They're moving out
14:42
Speaker 1: to the marketplace here domestically, and those aging containers that
14:46
Speaker 1: we had targeted during the fourth quarter to move those
14:48
Speaker 1: out of the way are down by nearly two thirds.
14:52
Speaker 1: We're still struggling a little bit with the amount of
14:54
Speaker 1: time containers sit at the terminal on the street waiting
14:58
Speaker 1: for warehouse space and coming back to the port. That's
15:02
Speaker 1: been a difficult time. But with all these imports we've
15:04
Speaker 1: pushed out, now we're starting to see those empty containers return.
15:08
Speaker 1: So our focus has got to be loading up as
15:10
Speaker 1: many of these as possible for US exporters and pushing
15:13
Speaker 1: out the rest of the empties for the next round
15:16
Speaker 1: of import from Asia. We've got about a hundred and
15:19
Speaker 1: three ships on the way departing Asia and headed towards
15:23
Speaker 1: the ports here in southern California, but only about a
15:26
Speaker 1: third of those are ten thousand container units and larger
15:30
Speaker 1: the traditional vessels that we have calling at the port.
15:33
Speaker 1: The balance are those newcomers, the charter hires and the
15:37
Speaker 1: one way ships trying to augment for additional capacity here
15:40
Speaker 1: ahead of water New year. How long do you think
15:44
Speaker 1: it's gonna be geane until we get back to normal? What? What?
15:48
Speaker 1: And what would you consider that I think it's going
15:52
Speaker 1: to be sometime. A normal has so many variables in
15:55
Speaker 1: that equation, from how merchandisers are putting in orders and factories,
15:59
Speaker 1: what factory can do through all macron, keeping staff on
16:03
Speaker 1: deck to produce the goods that we want to buy,
16:05
Speaker 1: making sure we have enough vessel capacity in the right places,
16:08
Speaker 1: and utilizing that capacity. One of the areas we're focused
16:12
Speaker 1: on most right now, Paul, is the latent capacity available
16:16
Speaker 1: to us here at the Port of Los Angeles. Fifty
16:19
Speaker 1: five of all available truck gates go unused every day,
16:24
Speaker 1: and we have an overhang of about thirty in our
16:27
Speaker 1: railroad capacity. We've got to keep moving this cargo out,
16:31
Speaker 1: absorb more that's on the water, and take advantage of
16:34
Speaker 1: squeezing every hour of efficiency we can through the port complex.
16:37
Speaker 1: Geane talked to us about labor. A lot of folks
16:40
Speaker 1: have suggested that, you know, there's just aren't enough folks
16:44
Speaker 1: to unload the containers, and then there aren't enough truckers
16:48
Speaker 1: to you know, get them out into, uh, the interior
16:52
Speaker 1: of the country. How do you think about the labor
16:55
Speaker 1: situation within your you know, ecosystem there at the port.
17:00
Speaker 1: Everybody who wants work right now still has it is
17:03
Speaker 1: that caravan a cargo is coming across the Pacific at
17:06
Speaker 1: still high levels of volume. Three segments of labor the
17:11
Speaker 1: dock workers, the International Longshore and Warehouse Union. They've been
17:14
Speaker 1: averaging six days a week on the job since the
17:16
Speaker 1: pandemic began back in March of They're going all out.
17:20
Speaker 1: Productivity per ship basis is the best in the industry. Second,
17:25
Speaker 1: of those truckers that you mentioned, they have hours of service,
17:28
Speaker 1: can't drive more than eleven hours a day, and if
17:30
Speaker 1: they drive consecutively, they've got to take some time off. Nationwide,
17:34
Speaker 1: the American Trucking Association says that we're eighty thousand drivers short,
17:39
Speaker 1: and I would represent here in southern California, we could
17:42
Speaker 1: use another three to four thousand port drayage drivers. Then
17:46
Speaker 1: there's the warehousing space. We've got two billion square feet
17:50
Speaker 1: under roof from the shores of the Pacific, outs of
17:52
Speaker 1: the desert region in southern California, and we're about eight
17:55
Speaker 1: thousand workers short right now, four hundred thousand ware hackers
18:00
Speaker 1: warehouse workers short nationwide. On these last two segments, they
18:04
Speaker 1: tend to be unrepresented, and we have to find a
18:06
Speaker 1: way to attract, recruit, and retain folks make these professions. Again,
18:11
Speaker 1: I know a great way to attract people to jobs
18:14
Speaker 1: that pay them more. Is that absolutely? Is that not
18:17
Speaker 1: part of the equation gene. It has to be thinking
18:21
Speaker 1: about how we pay labor wage and benefits, what you
18:25
Speaker 1: can do to attract folks into this industry and not
18:28
Speaker 1: wait until it's crunch time. Like we've seen over the
18:30
Speaker 1: past eighteen months, the industry has really got to focus
18:33
Speaker 1: on this, and some of the work that we're doing
18:35
Speaker 1: at the federal level with the C suite and the
18:36
Speaker 1: private sector is leading us down that path, but we've
18:39
Speaker 1: got to work double time alright. So Jean, as you
18:43
Speaker 1: think about it, I mean, you've been in this game
18:44
Speaker 1: a long time. Is the just in time inventory strategy
18:48
Speaker 1: that we've all grown up with is that being rethought?
18:50
Speaker 1: Do you think it has to be? We've all thought
18:53
Speaker 1: about lee and keeping inventory levels low. They are right
18:56
Speaker 1: now in the retail sector the lowest they've been in
18:58
Speaker 1: the decade since two thousand eleven. We've got to make
19:02
Speaker 1: sure that we have a good combination of where we
19:04
Speaker 1: can reshore manufacturing or near short in addition to having
19:09
Speaker 1: some certainty placed back into the international supply chain simply
19:14
Speaker 1: buying products just in case. So we weren't the company
19:17
Speaker 1: that was the paper example, tissue and toilet paper last
19:22
Speaker 1: year seemed to really gum up the works and folks
19:25
Speaker 1: are putting in orders and factories who are working in
19:28
Speaker 1: capacity now for the better part of a year and
19:30
Speaker 1: a half. So streamlining this, evaluating it at the company level,
19:34
Speaker 1: but also as a nation, and that's part of what
19:36
Speaker 1: we're doing and working with Port Envoy John Paccary, the
19:39
Speaker 1: National Economic Council, led by Brian Eas and others. Hey Geen,
19:43
Speaker 1: thanks so much for taking a time. We really appreciate
19:46
Speaker 1: getting your perspective. You are absolutely on the front lines
19:49
Speaker 1: of this global supply chain issue. With Gene Siroka, executive
19:52
Speaker 1: director at the Port of Los Angeles, the busiest container
19:56
Speaker 1: port in North America. You know a lot of folks
20:04
Speaker 1: are saying, hey, we need a ten percent, a fifteen
20:06
Speaker 1: or twenty percent correction in the market. It looks like
20:09
Speaker 1: where you go, here you go. This is what it
20:11
Speaker 1: looks like, Charlotte. It is the worst one day sell
20:15
Speaker 1: off for the SMP five since October twenty, which feels
20:20
Speaker 1: like it was so long ago. And how does Matt
20:22
Speaker 1: Miller know that? Because the s I N S function
20:25
Speaker 1: on the Bloomberg terminal tells you so, I will say,
20:29
Speaker 1: it's an internal function? Is it so only we can
20:32
Speaker 1: see it? I did not know that. If you ever
20:35
Speaker 1: need a quote on S I N S, I just
20:38
Speaker 1: message me. All right, let's check in with a professional
20:40
Speaker 1: on how we should be thinking about this. Jill Garby,
20:42
Speaker 1: she's a senior VP and senior wealth strategist at Huntington's
20:47
Speaker 1: National Bank. Jill, thanks so much for joining us. How
20:50
Speaker 1: do you how do you think about days like today,
20:54
Speaker 1: weeks like we've had over the last few weeks. How
20:56
Speaker 1: do you think about that? What are you telling your clients? Well, hello,
20:59
Speaker 1: Matt Paul, it's great to be with you. We look
21:02
Speaker 1: at this is maybe the best buying opportunity over the
21:05
Speaker 1: last two years. So we're coaching our clients to be patient,
21:10
Speaker 1: get the bio list ready. Our equity team certainly has
21:13
Speaker 1: their by list ready. And for those individuals who are
21:16
Speaker 1: sitting on a lot of cash, and as a top
21:19
Speaker 1: national bank, we're so fortunate to work with individual clients,
21:23
Speaker 1: many of whom are business owners. They've been liquidating all
21:26
Speaker 1: our portions of their business, others who have been liquidating
21:29
Speaker 1: real estate. You see this as a tremendous opportunity to
21:32
Speaker 1: start working that cash in. What do you think we're
21:37
Speaker 1: gonna see in terms of how is it going to
21:40
Speaker 1: work out in terms of inflation and the FED and
21:42
Speaker 1: how important is that to your individual investors. It's it's
21:47
Speaker 1: very important to our individual investors. In fact, we expect
21:52
Speaker 1: Wednesday to be very wild and another volatile day and
21:57
Speaker 1: it'll be very interesting to see the playboy that's coming
22:01
Speaker 1: with respect to inflation. We've been investing in our client
22:06
Speaker 1: portfolios with a bias too small and mid caps and reads.
22:09
Speaker 1: Of course, we like reads for current income and the
22:12
Speaker 1: potential for price appreciation, and right now with this volatility,
22:16
Speaker 1: I think it's a good reminder and certainly we're imparting
22:18
Speaker 1: this to our clients that you don't want to be
22:21
Speaker 1: invested in large cap growth. So we're taking a very
22:26
Speaker 1: nice barbettle approach where we have growth quality growth names,
22:31
Speaker 1: quality value names, and that's worked out very well for
22:34
Speaker 1: our clients. So, Joe, what's your economic outlook for two?
22:39
Speaker 1: I think you know, the economy by many measures, is
22:42
Speaker 1: in a pretty solid shape, but there is that inflation
22:45
Speaker 1: concern out there and it's getting I think more and
22:48
Speaker 1: more real by the day for a lot of investors.
22:50
Speaker 1: What's your economic outlook underpinning your investment outlook? It certainly
22:56
Speaker 1: is very real to everyone, and we expect that inflation
23:01
Speaker 1: will be dampened and there will be a decrease each quarter.
23:06
Speaker 1: We could end up with inflation in the three percent
23:10
Speaker 1: range later this year, and that's what we're imparted to
23:16
Speaker 1: our clients, and certainly we're watching that. But again, we
23:20
Speaker 1: see very strong individual consumer balance sheets, strong business balance sheets,
23:26
Speaker 1: and cash levels, so we think that will support continue
23:29
Speaker 1: spending an investment in so we think we would see
23:34
Speaker 1: you know, sm P, the SMP fire in h the
23:37
Speaker 1: high single digits and maybe even getting to the ten
23:40
Speaker 1: percent range. Certainly less than what we saw last year.
23:43
Speaker 1: But we are still very positive on stock. Yeah, we've heard.
23:48
Speaker 1: We've had a lot of people come and say CAPEX
23:50
Speaker 1: is going to be strong. Um, what about buy backs?
23:53
Speaker 1: What about dividends? What about payouts? Well, right now we're
23:57
Speaker 1: seeing um, dividend stocks are doing very well, and um,
24:02
Speaker 1: you know we we expect dividends and buy backs to continue.
24:07
Speaker 1: On the fixed income side, Joe, where are the opportunities here?
24:09
Speaker 1: And again a rising uh interest rate environment? What are
24:14
Speaker 1: you kind of telling your clients, Well, we see more
24:18
Speaker 1: risk in the fixed income market than the stock market
24:20
Speaker 1: right now as the rates rise. So again we're looking
24:24
Speaker 1: our Our fixed income team is looking at opportunities to
24:27
Speaker 1: get in. Many of our clients do have fixed income.
24:29
Speaker 1: We do a lot of work with our clients up
24:31
Speaker 1: front on planning and what they need. Some clients like
24:35
Speaker 1: fixed income to damp in volatility. So right now we're
24:38
Speaker 1: really looking at what the taxable equivalent yield is. We
24:42
Speaker 1: aren't really um getting into the muni markets. But um,
24:46
Speaker 1: we're looking at um tips of course for inflation protection,
24:51
Speaker 1: and some higher yielding fixed income investments because, let's face it,
24:56
Speaker 1: this lower interest rate environment has been great for roars
25:00
Speaker 1: but not great for savers. So we're looking to get
25:03
Speaker 1: as much shield as we can, and oftentimes we're looking
25:05
Speaker 1: at equities for that because the divining yield can be
25:08
Speaker 1: higher than the fiction comal do you have? I mean,
25:11
Speaker 1: are your high net worth individuals also interested in investing
25:16
Speaker 1: in things like commodities? And I hesitates you asked these
25:21
Speaker 1: in the same question, but crypto. I was going to
25:24
Speaker 1: go there, but you beat me. Yeah. Well, I mean,
25:26
Speaker 1: I'm just you know, I mean, you're in the middle
25:28
Speaker 1: of America. Um, Columbus, Ohio. She she's you're in Cincinnati, right.
25:34
Speaker 1: I hear Michigan in your voice. But I thought you
25:38
Speaker 1: were headquartered. I thought you were your office was in Cincinnati. Yes,
25:41
Speaker 1: of course, as as a as a native Ohio and
25:44
Speaker 1: I can spot a Michigander from like ten miles away, Ohio.
25:49
Speaker 1: What happened with the buck Eyes? You know, we did
25:51
Speaker 1: so well against the Sparties and then we lost to
25:54
Speaker 1: the Wolverines. I could not believe that this year. Normally
25:59
Speaker 1: we we talk a lot more about this jail, but
26:01
Speaker 1: we can't on a day when the SMP is selling
26:03
Speaker 1: off three bitcoin is a huge uh drop. We we
26:07
Speaker 1: saw it coming down below thirty four thousand. Do you
26:12
Speaker 1: have high net worth individuals or your big investors interested
26:16
Speaker 1: all in crypto or they just completely staying away from it.
26:20
Speaker 1: It's a mix. Certainly people are very curious about it.
26:23
Speaker 1: We still see it as speculative. So if our clients
26:27
Speaker 1: have excess cash and they can they like the volatility
26:32
Speaker 1: and they can ride that out, then they're investing in crypto.
26:35
Speaker 1: Many of our clients are staying away from it, but
26:38
Speaker 1: certainly that is the talk of the town, and if
26:42
Speaker 1: they have the excess liquidity, they're going in real quick
26:47
Speaker 1: thirty seconds. What's the number one, number one question you
26:50
Speaker 1: get from your clients these days? Where should I put
26:55
Speaker 1: my money? When should I be going into the market.
26:58
Speaker 1: And a lot of our clients are also concerned about
27:02
Speaker 1: protecting the wealth that they have, rather whether or not
27:05
Speaker 1: that's a business, real estate, they're marketable securities portfolio. So
27:10
Speaker 1: we get that question a lot. How can I best
27:12
Speaker 1: protect my asset and make sure that my family receives
27:17
Speaker 1: my wealth in a way that allows me to disinherit
27:20
Speaker 1: very appropriately the I R S. So that's a good questions,
27:25
Speaker 1: A non market question. Yeah, I like that. I like
27:27
Speaker 1: that term disinherit the I R S. I'm all fort
27:30
Speaker 1: Joe Garvey, Senior vice president and senior wealth Strategist at
27:33
Speaker 1: Huntington National Bank from the great state of Ohio. Thanks
27:38
Speaker 1: for listening to the Bloomberg Markets podcast. You can subscribe
27:42
Speaker 1: and listen to interviews an Apple Podcasts or whatever podcast
27:46
Speaker 1: platform you prefer. I'm Matt Miller. I'm on Twitter at
27:49
Speaker 1: Matt Miller three. Put on false Sweeney I'm on Twitter
27:53
Speaker 1: at pt Sweeney before the podcast. You can always catch
27:56
Speaker 1: us worldwide at Bloomberg Radio.