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Bitcoin ETFs, Boeing in Check, New Hampshire in Focus · Bloomberg Intelligence

• 0:01
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• 0:16
  Speaker 2: Well before I went on my little sojore into Aruba,
• 0:20
  Speaker 2: the bitcoin ETF was the thing that was the story.
• 0:24
  Speaker 3: I don't know how it's all been.
• 0:26
  Speaker 2: I do follow Eric Belchuna's research on Bootberg Intelligence and
• 0:30
  Speaker 2: so that kind of keeps me up up to speed here.
• 0:31
  Speaker 2: But let's check out somebody else's in this space. Chris Broaderson,
• 0:34
  Speaker 2: Managing Director Eisner Amper's Business Advisory Group.
• 0:39
  Speaker 3: Chris talk to us about.
• 0:40
  Speaker 2: How important having a spot bitcoin ETF is to the
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  Speaker 2: crypto space and to the ETF space.
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  Speaker 4: Sure, so thanks for having me. I think that the
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  Speaker 4: importance here is that having a spot ETF does a
• 0:56
  Speaker 4: couple of things. Number One, it lends legitimacy to the
• 0:59
  Speaker 4: asset cloud that it is recognized as a store of value.
• 1:03
  Speaker 4: Whether you agree with that or not, It certainly makes
• 1:07
  Speaker 4: it easier to invest. The average retail investor no longer
• 1:12
  Speaker 4: has to worry about things like wallets and key management
• 1:15
  Speaker 4: and custody and things like that. The other thing that
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  Speaker 4: it does is it potentially broadens the appeal and the
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  Speaker 4: ecosystem longer term.
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  Speaker 5: So, Paul, since you said you left Friday, that was
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  Speaker 5: the day that all the etf started trading in your
• 1:30
  Speaker 5: back today. So this is what you missed. In that
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  Speaker 5: first week of trading, spotpick win ETFs and US saw
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  Speaker 5: about six point five billion dollars in shares change hands.
• 1:38
  Speaker 5: That's according to Bloomberg Intelligence data. That is much higher
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  Speaker 5: than any kind of recorded ETFs pegged your traditional assets.
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  Speaker 5: So a lot of people are trading and moving these
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  Speaker 5: things around. Chris, do we know who?
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  Speaker 4: Oh? I don't know who. I assume it's largely retail investors.
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  Speaker 4: I mean, there has been discussion about the institutional investors,
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  Speaker 4: but I think the thing to okusam right now is
• 2:02
  Speaker 4: who's going to participate from a firm perspective. So, for example,
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  Speaker 4: Vanguard has said that they're not going to offer these
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  Speaker 4: ETFs on their platform, at least not now. Over the weekend,
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  Speaker 4: I was playing tennis with a registered investment advisor friend,
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  Speaker 4: and he said that his firm is in the process
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  Speaker 4: of looking at suitability investor suitability before they decide whether
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  Speaker 4: or not they're going to offer these ETFs. So I
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  Speaker 4: think over time you're going to see more and more
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  Speaker 4: firms open up their platforms to these ETFs.
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  Speaker 2: You know, Chris, before these things even started trading, seemed
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  Speaker 2: like a price war erupted. Everybody's cutting the fees. Here's
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  Speaker 2: what's going on here. I mean, I guess it seems
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  Speaker 2: like a bitcoins, a bitcoins a bitcoin. How do I
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  Speaker 2: differentiate one ETF from the other.
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  Speaker 3: Is it just fees?
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  Speaker 1: Well?
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  Speaker 4: I think it's fees, But I also think you have
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  Speaker 4: to look at the performance of the manager over time
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  Speaker 4: and how closely do they track. So if you talk
• 2:55
  Speaker 4: to Mike Novogratz, for example, he'll tell you that his
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  Speaker 4: Canadian ETF has the best tracking track record of all
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  Speaker 4: the ETFs out there. I can't speak to that. I
• 3:04
  Speaker 4: don't know if it's true, but I think that you
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  Speaker 4: have to balance the fees along with the track performance
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  Speaker 4: of the manager.
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  Speaker 5: So, okay, aside from that, how many more are you
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  Speaker 5: think are gonna come? So there's eleven right now. We
• 3:18
  Speaker 5: get a lot more, a couple more, because I think
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  Speaker 5: the big question everyone has is like, how many of
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  Speaker 5: these guys do you actually need.
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  Speaker 4: Yeah, I've heard that said over and over again, and
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  Speaker 4: I think that ultimately we'll probably end up with half
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  Speaker 4: a dozen or less. I just don't see the need
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  Speaker 4: for thirteen bitcoin ETFs at this point.
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  Speaker 2: So I guess bitcoin there's a lot more to the
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  Speaker 2: crypto space than Bitcoin. How about other ets for I
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  Speaker 2: don't know, ethereum or whatever else the kids are portraying
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  Speaker 2: these days.
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  Speaker 4: Sure, so I know that black Rock and a couple
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  Speaker 4: of others have applied for ethereum based ETFs. I don't
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  Speaker 4: think that we're going to see anything from the SEC
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  Speaker 4: probably until May. But having said that, I think that
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  Speaker 4: those ETFs are going to be a much more significant
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  Speaker 4: in terms of uphill battle. And the reason I say
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  Speaker 4: that is because the SEC has said very staunchly that
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  Speaker 4: all cryptos x bitcoin are considered securities. So these folks
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  Speaker 4: that want and ethereum ETF are going to have to
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  Speaker 4: convince the SEC that the underlying ethereum is not a
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  Speaker 4: security and why it should be allowed into.
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  Speaker 5: An ETF yep, And that is going to be tricky,
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  Speaker 5: and so maybe we just stick with what we have
• 4:38
  Speaker 5: and then go down to a little bit less. Can
• 4:41
  Speaker 5: I short, this thing can I can I put options
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  Speaker 5: on it? Can I do anything? When do you guys
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  Speaker 5: think that's going to happen?
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  Speaker 4: So pro Shares has already applied to have leveraged and
• 4:51
  Speaker 4: short bitcoin ETFs.
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  Speaker 5: Because Paul would probably be into that.
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  Speaker 4: Yeah, yeah, so that I would. I I wouldn't imagine
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  Speaker 4: that those will be coming. But you can also, you know,
• 5:03
  Speaker 4: trade in the futures market bitcoin, right, so go to
• 5:08
  Speaker 4: the CME if you want to play futures and options.
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  Speaker 2: So, you know, Chris, we did get the SEC to
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  Speaker 2: approve this in Genslers. SEC Chairman Gainster was the deciding
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  Speaker 2: vote to the positive. But boy, judging by his tweets,
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  Speaker 2: he doesn't really seem like he's a supporter here. I mean,
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  Speaker 2: is this thing? Is the SEC spoken? Is this done?
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  Speaker 2: Are we never going back to like Gary Ginster coming
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  Speaker 2: back and saying, you know what, this really is not
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  Speaker 2: what we need here.
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  Speaker 4: Well, I can't speak to what's in Chairman Ginstzler's head,
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  Speaker 4: but what I can tell you is that, you know,
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  Speaker 4: I think the SEC did this somewhat reluctantly because their
• 5:47
  Speaker 4: hands were sort of tied by the courts. And I
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  Speaker 4: think that the ultimate arbiter of this will be in
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  Speaker 4: the court of public opinion. What happens to the price
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  Speaker 4: of these of bitcoin and bitcoin ETFs over time? Is
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  Speaker 4: it truly or a value? Is it something that people
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  Speaker 4: will look to in times of uncertainty like digital goal
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  Speaker 4: that's been talked about. Time will tell and I wish
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  Speaker 4: I had that kind of crystal all yeah.
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  Speaker 5: Time, And it really depends on what timeframe, right, Like
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  Speaker 5: is it going to take three six months to sess
• 6:15
  Speaker 5: out or a lot longer. But Paul, what I think
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  Speaker 5: is interesting too is if you want to diversify your investment, right,
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  Speaker 5: that's the whole idea. Let's diversify, let's do alternative investment.
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  Speaker 5: Do you need ten percent in bitcoin or do you
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  Speaker 5: need like one percent?
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  Speaker 1: Like what?
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  Speaker 5: And that's going to make a big difference into the
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  Speaker 5: uptake of these guys too.
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  Speaker 3: Paul, Yeah, it's interesting.
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  Speaker 2: I think a lot of folks are just saying I
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  Speaker 2: want to have some exposure, by a lot of folks
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  Speaker 2: are saying I just don't need it at all because
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  Speaker 2: I don't understand it. Chris, I know what eyaer after
• 6:40
  Speaker 2: you kind of look at kind of all things fintech.
• 6:42
  Speaker 2: If you will blockchain, what's the next big thing that
• 6:46
  Speaker 2: you guys are talking to your clients about. Is it
• 6:48
  Speaker 2: just more crypto, better crypto?
• 6:52
  Speaker 3: What's the next big thing you're looking at.
• 6:54
  Speaker 4: I think that the real opportunity longer term is in
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  Speaker 4: the tokenization of world and traditional assets. Crypto is interesting,
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  Speaker 4: it certainly has its place. It's not going away anytime soon.
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  Speaker 4: But when we look at the efficiency gains and the
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  Speaker 4: ability to fundamentally re architect the middle and back office
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  Speaker 4: functions of a number of financial institutions using tokens, I
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  Speaker 4: think that that is just going to be a huge,
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  Speaker 4: significant opportunity in the future.
• 7:22
  Speaker 5: So I do my taxes with Eisner Effert. Just full
• 7:25
  Speaker 5: disclosure inside, I'm like a nine year old person and
• 7:29
  Speaker 5: I don't want to pay any taxes and I want
• 7:31
  Speaker 5: to be really super safe with my investments. What is
• 7:34
  Speaker 5: the best sort of way to utilize my money that
• 7:37
  Speaker 5: doesn't involve paying a botload of taxes? Like? Do I
• 7:40
  Speaker 5: want a bit quinn ETF? From that perspective, do I
• 7:42
  Speaker 5: want to switch from the GBC trust to the ETF?
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  Speaker 6: Like?
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  Speaker 5: Do I want to do those things?
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  Speaker 4: Well, there's a few reasons why you would want to switch,
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  Speaker 4: And this is not investment advice. Alex, please understand that.
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  Speaker 4: But what I can tell you is that with the ETF,
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  Speaker 4: it's much easier to pay your taxes than if you
• 8:02
  Speaker 4: were to own the bitcoin directly. If you own the
• 8:04
  Speaker 4: bitcoin directly, now you have basis tracking and a whole
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  Speaker 4: bunch of other things that you need to report to
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  Speaker 4: the IRS, as opposed to just getting your statement from
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  Speaker 4: your ETF provider at the end of the year.
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  Speaker 2: All right, Chris, thanks so much for joining us here.
• 8:17
  Speaker 2: Chris Broderson, Managing Director, Eisner Ampers.
• 8:21
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• 8:40
  Speaker 2: All right, I just got back from a wonderful trip
• 8:42
  Speaker 2: down to Rubat and both ways flow. The Boeing seven
• 8:46
  Speaker 2: three seven nine hundred er worked like a charm, no
• 8:50
  Speaker 2: problems whatsoever.
• 8:51
  Speaker 3: All good. It wasn't the Max, it was the ER.
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  Speaker 2: Now I understand that the ER may have some issues here,
• 8:59
  Speaker 2: so I don't know what's going on with our good
• 9:01
  Speaker 2: friends at Boeing. When I think Bowing, I think of
• 9:04
  Speaker 2: American engineering ingenuity. But boy, they've had a tough four
• 9:08
  Speaker 2: or five years. Sarar Phillip joins us. He's a deputy
• 9:11
  Speaker 2: team leader for Global Aviation for Bloomberg News. He's in
• 9:14
  Speaker 2: our Bloomberg studios, joining us via zoom So thanks so
• 9:17
  Speaker 2: much for joining us here.
• 9:19
  Speaker 3: What's going on with Boeing?
• 9:21
  Speaker 2: I mean, it seems like generations we want without dealing
• 9:23
  Speaker 2: with anything, and now it just seems like there's a
• 9:26
  Speaker 2: lot of issues there from engineering perspective.
• 9:27
  Speaker 3: What do you think's going on?
• 9:29
  Speaker 7: Thanks both. So, Yeah, there is a lot of scrutiny
• 9:31
  Speaker 7: over Boeing's manufacturing quality, and the latest sort of scrutiny
• 9:35
  Speaker 7: is on the seven three seven nine hundred er, which
• 9:38
  Speaker 7: is the previous generation of the Boeing seven three seven,
• 9:42
  Speaker 7: which is sort of predates the Max that was used
• 9:45
  Speaker 7: on the flight on jan fifth that had that dramatic
• 9:49
  Speaker 7: blowout of the plug door. The reason why they've expanded
• 9:53
  Speaker 7: this probe is basically the nine hundred er uses the
• 9:57
  Speaker 7: same type of plugs on its emergency exits as the
• 10:02
  Speaker 7: one that failed on the Alaska Airlines flight this month,
• 10:04
  Speaker 7: and That's why the FFAs asked airlines that basically operate
• 10:08
  Speaker 7: this type to uh do sort of for an additional
• 10:12
  Speaker 7: level of safety, to sort of have a visual inspection
• 10:15
  Speaker 7: of it, to make sure it's probably secured.
• 10:17
  Speaker 3: All right.
• 10:18
  Speaker 2: I had a great flight coming back on my seven
• 10:20
  Speaker 2: three seven nine R.
• 10:22
  Speaker 3: Plane was great. One problem, A huge problem, screaming kid.
• 10:27
  Speaker 2: Probably three or four years old, old enough to know
• 10:29
  Speaker 2: better than his parents should know better.
• 10:31
  Speaker 3: The entire five hour flight.
• 10:33
  Speaker 5: That's tough.
• 10:33
  Speaker 2: It was brutal, and I just wanted to parents at
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  Speaker 2: the end.
• 10:36
  Speaker 3: I was like, what do you guys, it's just your fruit?
• 10:38
  Speaker 3: Did oh totally?
• 10:40
  Speaker 2: Just says really, And I just said, you gotta do better,
• 10:42
  Speaker 2: you gotta do better?
• 10:44
  Speaker 5: Did they say?
• 10:45
  Speaker 3: They were not happy with this? Is This is the
• 10:46
  Speaker 3: same Paul who people in the company here at Bloomberg.
• 10:50
  Speaker 3: When he doesn't like the way they dress, you call
• 10:52
  Speaker 3: him you can't wear flip flops in my place of business.
• 10:55
  Speaker 5: Well for sure, and there has to be yes also
• 11:02
  Speaker 5: like sure, buttons you need to not have them low.
• 11:04
  Speaker 5: That's all for guys anyway, and for girls. So back
• 11:07
  Speaker 5: on track, said so Boeing made it in to Saturday
• 11:12
  Speaker 5: Night Live over the weekend. When that happens, I feel
• 11:15
  Speaker 5: like that becomes a real issue. Like it's now in
• 11:17
  Speaker 5: the everyday vernacular, it's in the skit of the weekend.
• 11:23
  Speaker 5: How big a pr problem is this really going to
• 11:26
  Speaker 5: be or do we feel like it's already kind of
• 11:27
  Speaker 5: priced in?
• 11:29
  Speaker 7: I think it is priced in, but I mean essentially
• 11:32
  Speaker 7: what everyone's looking for, in what investors are looking for
• 11:36
  Speaker 7: is basically trying to see how things go from here. Essentially,
• 11:40
  Speaker 7: the Max nine is still not back in service, and
• 11:44
  Speaker 7: that's really the key question as to when regulators will
• 11:47
  Speaker 7: approve of the procedure to sort of bring them back
• 11:50
  Speaker 7: into service. And also everyone's looking to see what the
• 11:54
  Speaker 7: deliveries look like and whether or not this will have
• 11:57
  Speaker 7: any impact on deliveries of new planes that are stretch
• 12:00
  Speaker 7: out into next year, because as you know, I mean,
• 12:03
  Speaker 7: airlines are looking for as much lift as they can,
• 12:06
  Speaker 7: as much capacity as they can, and this is really
• 12:08
  Speaker 7: crucial to determine how this sort of demand goes forward,
• 12:12
  Speaker 7: especially at the time when there's a little bit of
• 12:14
  Speaker 7: uncertainty about how the demand's going to play out. I mean,
• 12:17
  Speaker 7: we've seen revenge travel and we're looking to see sort
• 12:20
  Speaker 7: of indications of how that's going to play out. I mean,
• 12:23
  Speaker 7: a lot of airlines are going to be reporting earnings
• 12:26
  Speaker 7: in the next couple of days, and we shall see
• 12:28
  Speaker 7: what they already talk about outlook.
• 12:30
  Speaker 2: So sid I mean, I guess the reality is this
• 12:34
  Speaker 2: is a duopoly.
• 12:35
  Speaker 3: It's Airbus and it's Bowing. I can't just say I'm
• 12:37
  Speaker 3: fed up with Bower.
• 12:38
  Speaker 2: I'm gonna start buying my stuff from Airbus because Airbus
• 12:41
  Speaker 2: has got multi year backlogs.
• 12:43
  Speaker 3: So if you're Boeing, what's job one? Do you think?
• 12:48
  Speaker 2: Is it just is a marketing pr or is it
• 12:51
  Speaker 2: actually changing your engineering process, your manufacturing process.
• 12:56
  Speaker 7: I think it's really focusing on quality and building quality.
• 12:59
  Speaker 7: I think that's going to reasuy or public that essentially
• 13:01
  Speaker 7: that planes are safe to fly, and also reassure the
• 13:04
  Speaker 7: customers that they don't have to worry about planes being
• 13:06
  Speaker 7: pulled out of service for inspections and sort of the
• 13:09
  Speaker 7: complexity of it and having to restructure your operations based
• 13:13
  Speaker 7: on that complexity. So I think the key question is
• 13:16
  Speaker 7: getting to a point where you're assured of the quality
• 13:19
  Speaker 7: of the aircraft and that can sort of give it
• 13:21
  Speaker 7: some stability in terms of airlines happy your customers are
• 13:25
  Speaker 7: happy and they're not worried about whether or not they're
• 13:28
  Speaker 7: going to fly out of an aircraft. And I think
• 13:30
  Speaker 7: three step one over it.
• 13:32
  Speaker 5: I mean that feels like a fair thing. Yeah, okay, well,
• 13:35
  Speaker 5: good point. Apparently Alaska Ara is commenting on the seven
• 13:38
  Speaker 5: thirty seven, nine hundred er door plug in an email
• 13:41
  Speaker 5: saying that they find no issues so far in those checks.
• 13:45
  Speaker 5: So that's something so said normally. As in before today,
• 13:49
  Speaker 5: I was on TV from ten to twelve with Guy
• 13:51
  Speaker 5: Johnson on the European Close and apparently there's like a
• 13:53
  Speaker 5: storm and stuff, and I guarantee you this is all
• 13:56
  Speaker 5: he would have been talking about for two hours. So
• 13:58
  Speaker 5: I feel like I need to know about the storm
• 14:00
  Speaker 5: and stuff over in Europe. What's going on with weather?
• 14:03
  Speaker 7: Yeah, so there's a storm storm ishe that's disrupting travel
• 14:07
  Speaker 7: causing power blackouts across northern Europe. There's hurricane force winds
• 14:11
  Speaker 7: that are lashing the sort of northern Europe and the
• 14:15
  Speaker 7: UK and Ireland, and so that's really disrupted travel as
• 14:19
  Speaker 7: well as our supply to various homes in Ireland as
• 14:24
  Speaker 7: well as the UK, and so I think that has
• 14:28
  Speaker 7: had a really big impact on a ship all Airport
• 14:31
  Speaker 7: in Amsterdam where they've canceled one hundred and thirty flights
• 14:34
  Speaker 7: this morning, and they've talked about winds being over one
• 14:37
  Speaker 7: hundred kilometers an hour.
• 14:39
  Speaker 2: All right, so thanks so much for joining us. Sid Philip,
• 14:42
  Speaker 2: Deputy team leader Global Aviation for Bloomberg News.
• 14:46
  Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live
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• 14:56
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• 15:01
  Speaker 3: Let's talk about these markets here.
• 15:02
  Speaker 2: I mean, you know, we started off the first few
• 15:04
  Speaker 2: days of trading selling off, and a lot of people said, yeah,
• 15:06
  Speaker 2: that makes sense. We had that huge run at the
• 15:08
  Speaker 2: end of the year. But now we found a little
• 15:10
  Speaker 2: bit of stability here. So let's check in and see
• 15:12
  Speaker 2: what some of these professionals are doing. Coler Schlife she's
• 15:15
  Speaker 2: one of them. She's a chief investment officer for the
• 15:18
  Speaker 2: Beimo Family Office. Cayl, thanks so much for joining us here.
• 15:22
  Speaker 2: You know, a lot of folks were starting this year saying, boy,
• 15:24
  Speaker 2: that huge gain we had in you know, the last
• 15:27
  Speaker 2: couple of months of twenty twenty three, they probably pulled
• 15:30
  Speaker 2: some performance from twenty twenty four a little.
• 15:32
  Speaker 3: Bit forward here, we're gon be a little bit of
• 15:33
  Speaker 3: a bumpy here in the beginning.
• 15:35
  Speaker 2: What's your take on kind of that thought and kind
• 15:37
  Speaker 2: of when you talk to your clients, what are you
• 15:38
  Speaker 2: telling them about twenty twenty four.
• 15:41
  Speaker 8: Yeah, we definitely agree that markets got a little over
• 15:44
  Speaker 8: their skis with exuberance in the last couple of months
• 15:47
  Speaker 8: of twenty twenty three. But the great part was to
• 15:51
  Speaker 8: see the broadening of it, not just being the primary
• 15:54
  Speaker 8: Magnificent seven or even if you took it out to
• 15:57
  Speaker 8: ten or twelve of those top tech names driving them
• 16:00
  Speaker 8: majority of last year's market. So we did think you'd
• 16:03
  Speaker 8: see some pullback in here. We do think for sustainability
• 16:06
  Speaker 8: for markets to behave themselves well again this year, you
• 16:09
  Speaker 8: do need to continue to see that broadening out, which
• 16:12
  Speaker 8: you really didn't see in the last couple of weeks
• 16:14
  Speaker 8: as things have stabilized.
• 16:15
  Speaker 9: But it's not unusual at all when you have.
• 16:17
  Speaker 8: That kind of run up going into your end, especially
• 16:20
  Speaker 8: at the late trading volume you would have had between
• 16:23
  Speaker 8: Christmas and New Year's when a lot of.
• 16:25
  Speaker 9: Those highs were approached. If you will.
• 16:29
  Speaker 8: It's not unusual at all to see a kind of
• 16:32
  Speaker 8: reassessment of that. You've also had a pretty major reassessment
• 16:35
  Speaker 8: in terms of timing and quantity of FED cuts because
• 16:39
  Speaker 8: a lot of the market exuberance and late last year
• 16:41
  Speaker 8: was looking for cuts starting in March, which we don't
• 16:45
  Speaker 8: think you'll see.
• 16:46
  Speaker 5: Just to update everybody, Archer Daniel's Midland down twenty two percent,
• 16:51
  Speaker 5: most on record. Sure there are reasons cutting its outlook
• 16:54
  Speaker 5: the CFO on leave, there's some issues and accounting practices. Nonetheless,
• 16:58
  Speaker 5: if you miss or get hurt in this mart you
• 17:00
  Speaker 5: can get really, really hurt. Carol, do you buy the
• 17:03
  Speaker 5: rip that we've seen in the last couple of days?
• 17:07
  Speaker 9: Do I buy the I'm sorry?
• 17:08
  Speaker 5: Do you buy the rip? Do you buy the rally?
• 17:11
  Speaker 1: Oh?
• 17:12
  Speaker 8: Yeah, I think I'm not sure it's pulled back necessarily
• 17:15
  Speaker 8: far enough. But with cash on the sidelines, I think
• 17:17
  Speaker 8: it is time because a lot of people have been
• 17:19
  Speaker 8: very comfortable sitting in cash, and it's time to start
• 17:22
  Speaker 8: locking in either some physicians in the stock market, some
• 17:26
  Speaker 8: longer term you know, even going out to two, five,
• 17:29
  Speaker 8: five years or a little more. In the fixed income markets.
• 17:32
  Speaker 8: We do think you've seen. You'll see that tenure gravitate
• 17:37
  Speaker 8: more towards four and a quarter four and a half
• 17:39
  Speaker 8: percent by the end of the year, but it locking
• 17:41
  Speaker 8: in some potential investments and moving it out of cash
• 17:46
  Speaker 8: where it's been arguably a really great place to sit
• 17:49
  Speaker 8: through much of last year. But when the FED gets
• 17:52
  Speaker 8: around to starting to cut, you'll see some of the
• 17:56
  Speaker 8: nice yields on those money market accounts disappear.
• 18:00
  Speaker 2: When I started on Wall Street in the mid eighties,
• 18:02
  Speaker 2: Japan was the bomb. I mean that was a place
• 18:05
  Speaker 2: that was growing like crazy. If you wanted to further
• 18:08
  Speaker 2: your career in Wall Street, you had to do a
• 18:09
  Speaker 2: stint in the Tokyo office. And then for the last
• 18:12
  Speaker 2: twenty or thirty years there's been nothing, no growth, no place,
• 18:16
  Speaker 2: and nobody really pay paid attention to it. Now I'm
• 18:19
  Speaker 2: starting to hear people talk about Japan. I see that
• 18:22
  Speaker 2: in your notes. I even heard Warren Buffett talk about Japan.
• 18:27
  Speaker 2: How are you thinking about Japan here?
• 18:30
  Speaker 9: I think there's been I too, started when Japan Inc.
• 18:33
  Speaker 8: Was the cover story on Business Week, and I probably
• 18:37
  Speaker 8: still have that cover in my file someplace.
• 18:39
  Speaker 9: But I think then you, as you so aptly noted.
• 18:42
  Speaker 8: We went into twenty or thirty years worth of it
• 18:45
  Speaker 8: trying to rally and come back out and disinflation hitting.
• 18:49
  Speaker 8: But there's a lot of things structurally that are going
• 18:51
  Speaker 8: on in Japan right now, and by and large the
• 18:54
  Speaker 8: globe is underweighted in that very key developed market. But
• 18:58
  Speaker 8: there's a lot of things, for example, governance issues going
• 19:03
  Speaker 8: on with publicly held companies there where over half of
• 19:06
  Speaker 8: them are trading below book value, and there's new regulatory
• 19:09
  Speaker 8: oversight saying that you need to get a plan in place,
• 19:13
  Speaker 8: you need outside directors on the board, a plan in
• 19:15
  Speaker 8: place to get those stock prices up. And there's a
• 19:18
  Speaker 8: lot of things structurally going on there that make us
• 19:20
  Speaker 8: very interested in it. And again the fact that most
• 19:23
  Speaker 8: of the globe is pretty severely underweighted in Japan because
• 19:28
  Speaker 8: of the fact that it's been thirty years since they
• 19:31
  Speaker 8: were on magazine covers.
• 19:34
  Speaker 5: So yeah, fair enough, And this kind of pairs in
• 19:36
  Speaker 5: with your FED call too, Right, we're all kind of
• 19:38
  Speaker 5: waiting for the BOJ to at least end zero percent, right,
• 19:42
  Speaker 5: at least a little bit of a baby hike, but
• 19:44
  Speaker 5: that hasn't happened. You mentioned that the FED isn't going
• 19:47
  Speaker 5: to be cutting in March, and I'm wondering how you
• 19:48
  Speaker 5: look at the timing of all of this and then
• 19:51
  Speaker 5: how you deal with equities out of it.
• 19:54
  Speaker 8: Well, I think the piece of it is is that
• 19:56
  Speaker 8: the direction is in the right direction. We think the
• 20:00
  Speaker 8: Fed's done raising. Whether they cut in March or May,
• 20:04
  Speaker 8: or June or July, it's almost none not as relevant, Yeah, exactly, Sorry,
• 20:14
  Speaker 8: not enough caffeine this morning. It's not as relevant there
• 20:19
  Speaker 8: in terms of it's Directionally, the Fed most likely is
• 20:23
  Speaker 8: done raising, is going to start cutting at some point,
• 20:26
  Speaker 8: and so we think it does tee up a pretty
• 20:29
  Speaker 8: constructive market. Those who are lending to companies have the
• 20:34
  Speaker 8: opportunity to, Okay, now we can firm up our models
• 20:37
  Speaker 8: and figure out what our prospects are for the next
• 20:39
  Speaker 8: three to five years. The trend is for more rate cuts.
• 20:42
  Speaker 8: The bed is ample room in here. If our economy
• 20:45
  Speaker 8: does start to tail off, now, they have ample room
• 20:47
  Speaker 8: in here to be able to cut more aggressively at
• 20:51
  Speaker 8: some point if they need to. But you've seen a
• 20:54
  Speaker 8: very healthy market in here. That employment numbers out late
• 20:57
  Speaker 8: last week were very solid and indicative of markets that
• 21:01
  Speaker 8: are coming into better balanced Consumers are pretty exuberant investors
• 21:05
  Speaker 8: are pretty constructive.
• 21:07
  Speaker 9: But as long as we hopefully get.
• 21:09
  Speaker 8: To see a broadening out of mid caps and small
• 21:12
  Speaker 8: caps participating more and more industries other than just technology
• 21:17
  Speaker 8: driving this rally, we think you'll have a pretty reasonable year.
• 21:21
  Speaker 2: All right, cal thanks so much for joining us. Appreciate
• 21:23
  Speaker 2: getting a few minutes of your time. Collacrich Life, Chief
• 21:26
  Speaker 2: Investment Officer, BEML Family Office.
• 21:30
  Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live
• 21:34
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• 21:38
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• 21:40
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• 21:48
  Speaker 5: We have the New Hampshire primary kicking off tomorrow, and
• 21:51
  Speaker 5: understanding how the election and policies are going to influence
• 21:54
  Speaker 5: all these companies and all these industries is going to
• 21:57
  Speaker 5: be key based on your returns for the end of
• 21:59
  Speaker 5: the year. Joining us now. Political news director for Bloomberg
• 22:02
  Speaker 5: TV and Radio, Jody Schneider from New Hampshire. Jody, it's
• 22:07
  Speaker 5: been a very turbulent a twenty four hours in the
• 22:09
  Speaker 5: political world. What is life there on the ground, without
• 22:11
  Speaker 5: DeSantis on the ballot.
• 22:13
  Speaker 10: Yeah, it has been.
• 22:14
  Speaker 6: We got the news that Ron DeSantis was dropping out
• 22:18
  Speaker 6: yesterday as some of us were about to had to
• 22:20
  Speaker 6: cover a rally of his, So that's how kind of
• 22:23
  Speaker 6: sudden it was. And he of course endorsed former President
• 22:27
  Speaker 6: Donald Trump, so that really is kind of making it
• 22:31
  Speaker 6: a harder battle for Nicky Haley. She is trying to
• 22:36
  Speaker 6: win here in New Hampshire. She needs a very strong
• 22:38
  Speaker 6: showing tomorrow in the primary to stay in this race,
• 22:41
  Speaker 6: to stay competitive against Donald Trump, and that's going to
• 22:45
  Speaker 6: be tough given that Ron DeSantis threw his support to
• 22:49
  Speaker 6: his former rival Donald Trump. And also we have had
• 22:54
  Speaker 6: some others throw their support, including Tim Scott, the senator
• 22:58
  Speaker 6: from Nicky Haley's home state of South Carolina, who she
• 23:01
  Speaker 6: put into his job.
• 23:03
  Speaker 10: He threw his support as.
• 23:04
  Speaker 6: He exited the race, well actually after he exited the race,
• 23:08
  Speaker 6: to Donald Trump as well.
• 23:09
  Speaker 10: So it's a two person race, but Donald Trump is
• 23:12
  Speaker 10: certainly the one to beat.
• 23:14
  Speaker 2: So I guess, is there any scenario here where Nikki
• 23:18
  Speaker 2: Haley and her team can claim some type of victory
• 23:21
  Speaker 2: to maybe keep going here. What would be a I guess,
• 23:23
  Speaker 2: A win?
• 23:25
  Speaker 6: Yeah, a win would be an actual win if if
• 23:27
  Speaker 6: we had a surprise upset and she came in first,
• 23:30
  Speaker 6: if she came in a strong second Tim she could
• 23:34
  Speaker 6: claim victory that she did well against sort of the
• 23:39
  Speaker 6: very strong front runner. The problem with that is that
• 23:42
  Speaker 6: South Carolina in a month from now. We have Nevada
• 23:45
  Speaker 6: in between, but South Carolina is the next significant race,
• 23:49
  Speaker 6: the next significant primary contest, and even though she's the
• 23:53
  Speaker 6: former governor, Donald Trump is expected to do very well there,
• 23:57
  Speaker 6: especially with that endorsement from Tim Scott. So this makes
• 24:00
  Speaker 6: it really hard for her. And unless she does really
• 24:02
  Speaker 6: well tomorrow, the betting is that she will drop out
• 24:06
  Speaker 6: before South Carolina and an embarrassment in her home state.
• 24:09
  Speaker 6: Question a lot of people are already asking is will
• 24:12
  Speaker 6: she endorse Donald Trump on her way out?
• 24:14
  Speaker 5: So she has said that she will vote for the
• 24:16
  Speaker 5: Republican nominee, but will her supporters do that? So I'm
• 24:20
  Speaker 5: really curious as to what's going to happen to the independence,
• 24:23
  Speaker 5: to the centrist Republicans and the centrist Democrats. If Nikki
• 24:26
  Speaker 5: Haley bales, where are we hearing they're going to go?
• 24:30
  Speaker 6: Yeah? I mean, there won't be much place for them
• 24:32
  Speaker 6: to go in terms of the rest of the primaries. It's,
• 24:35
  Speaker 6: you know, it's feeling like all but inevitable that Donald
• 24:38
  Speaker 6: Trump unlets again. We have a really surprise upset tomorrow
• 24:42
  Speaker 6: that he will be the nominee for the party, and
• 24:44
  Speaker 6: an early nominee. This will be the earliest, certainly in
• 24:47
  Speaker 6: recent memory, that we've seen the two candidates, the general
• 24:51
  Speaker 6: election contenders determined. The question I guess is what happens
• 24:55
  Speaker 6: to them in the fall. Do they maybe crossover and
• 24:58
  Speaker 6: vote for the Democratic nominee or do they just stay home?
• 25:02
  Speaker 6: And a lot of people think there's going to be
• 25:04
  Speaker 6: a lot of staying home without without much enthusiasm overall
• 25:09
  Speaker 6: for either candidate, and it really will become who can
• 25:12
  Speaker 6: turn out their folks. There's also the question of a
• 25:16
  Speaker 6: third party candidate. We have no Labels, a group that
• 25:19
  Speaker 6: has said that if they don't have anybody besides Donald
• 25:23
  Speaker 6: Trump and Joe Biden, that they would look at a
• 25:26
  Speaker 6: third party candidate. But there may be some independence that
• 25:28
  Speaker 6: crop up that start to get some resonance. Given this
• 25:32
  Speaker 6: sort of inevitability, and given the fact as we've seen
• 25:35
  Speaker 6: in polling that a lot of people would prefer somebody
• 25:39
  Speaker 6: other on both sides Republicans and Democrats would prefer somebody
• 25:42
  Speaker 6: other than who they're going to likely get in Donald
• 25:45
  Speaker 6: Trump and Joe Biden.
• 25:47
  Speaker 2: So, Jodie, what's the thinking in the belt weigh these
• 25:49
  Speaker 2: days in Washington about if we do get what seems
• 25:52
  Speaker 2: to be the inevitable Biden versus Trump race in November,
• 25:56
  Speaker 2: how does that go?
• 25:57
  Speaker 3: Who's got the edge? What's the early thinking there?
• 26:01
  Speaker 10: Yeah, again, I think it will be a very close race.
• 26:03
  Speaker 6: People are saying, and people were talking to here in
• 26:05
  Speaker 6: New Hampshire political prognosticators pundits we call them. They are
• 26:10
  Speaker 6: saying it's going to get ugly. It's going to get
• 26:12
  Speaker 6: ugly fast, and it really will be interesting to see
• 26:15
  Speaker 6: if the public, what the public thinks of that and
• 26:17
  Speaker 6: what the polls say. We're also dealing with two men
• 26:21
  Speaker 6: quite you know older. The current president is eighty one,
• 26:25
  Speaker 6: Donald Trump is seventy seven. You know, you are looking
• 26:29
  Speaker 6: at really a lack of enthusiasm from younger voters certainly
• 26:33
  Speaker 6: about what they're seeing.
• 26:34
  Speaker 10: So the question will be would a third party.
• 26:37
  Speaker 6: Candidate get some residents or are people just going to
• 26:39
  Speaker 6: sort of hold their nose and vote for the candidate
• 26:42
  Speaker 6: they find the least objectionable, and again, we may be
• 26:46
  Speaker 6: looking at a record low turnout, record low participation general
• 26:51
  Speaker 6: election if something doesn't happen to excite voters, because right
• 26:55
  Speaker 6: now they are not excited.
• 26:56
  Speaker 5: Right It's like, do those centers just stay home? Which
• 26:59
  Speaker 5: would be bizarre turnout too, Jody, what sort of policies
• 27:04
  Speaker 5: should the markets start to pay attention to? Things like
• 27:08
  Speaker 5: making the Trump text cuts permanent, obviously, tariffs on anything
• 27:12
  Speaker 5: being imported into the country. It feels like either way,
• 27:16
  Speaker 5: enormous budget deficits are here to stay, which I know
• 27:19
  Speaker 5: is weird to say when you're also floating a staunch
• 27:21
  Speaker 5: Republican on the ticket. What do we start to pay
• 27:23
  Speaker 5: attention to now?
• 27:26
  Speaker 6: Yeah, I think about those things you mentioned, Alex are
• 27:27
  Speaker 6: really good points for the markets and investors to start
• 27:30
  Speaker 6: looking at as this becomes inevitable that we have Donald
• 27:33
  Speaker 6: Trump versus Joe Biden. We know that both have had
• 27:36
  Speaker 6: a lot of spending on their plates and some of
• 27:38
  Speaker 6: this was pandemic, and you know, came from the pandemic
• 27:42
  Speaker 6: and those the paychecks, the checks that went to everybody.
• 27:46
  Speaker 6: But also on the tariffs, we saw Donald Trump put
• 27:49
  Speaker 6: in place those China tariffs and they have not been
• 27:51
  Speaker 6: removed by Joe Biden. So I think there's some things
• 27:54
  Speaker 6: here that that investors can start thinking about. These are
• 27:57
  Speaker 6: likely to be what we will see with these to men.
• 28:00
  Speaker 6: We will also see how do they work with Congress.
• 28:02
  Speaker 6: That's the other thing we haven't really had much of
• 28:04
  Speaker 6: a chance to talk about, and we will in coming months.
• 28:07
  Speaker 6: Both chambers of Congress are really up for grabs. It
• 28:11
  Speaker 6: is widely expected that the Republicans could lose control of
• 28:15
  Speaker 6: the House given what happened, particularly with their speaker fights
• 28:19
  Speaker 6: this past year. The Senate, the Democrats there have a
• 28:22
  Speaker 6: harder map to maintain control of the Senate than the
• 28:25
  Speaker 6: Republicans do.
• 28:26
  Speaker 10: So there's a lot of issues there. Who will work
• 28:29
  Speaker 10: well with Congress? Will they get much done well?
• 28:32
  Speaker 2: Given that backdrop of just the calendar Jody being an
• 28:35
  Speaker 2: election year, what's going to go? What does Congress have
• 28:38
  Speaker 2: to get done? Don't they have to keep the government open,
• 28:40
  Speaker 2: that's kind of important. They've got some big bills as
• 28:43
  Speaker 2: it relates to foreign ad which I know being tied
• 28:46
  Speaker 2: to immigration. What's the expectation in Washington and how that
• 28:50
  Speaker 2: might proceed in an election year.
• 28:53
  Speaker 6: Yeah, so they do have to keep the government up,
• 28:55
  Speaker 6: and they've been able to do these short term crs,
• 28:57
  Speaker 6: and we've had threatened we've had several rounds of threatened shutdowns.
• 29:01
  Speaker 10: We haven't had we haven't had that occur yet.
• 29:03
  Speaker 6: But they just keep passing these short term continuing resolutions.
• 29:07
  Speaker 6: They just passed another one last week that gets us
• 29:09
  Speaker 6: to March, to write around Super Tuesday and right around
• 29:13
  Speaker 6: State of the Union.
• 29:14
  Speaker 10: Uh, so they do.
• 29:16
  Speaker 6: And there seems to be a lot of talk of
• 29:18
  Speaker 6: trying to get away from this, but uh, the speaker,
• 29:22
  Speaker 6: Speaker Johnson, you know, has a very narrow path to
• 29:26
  Speaker 6: get things done. He even if he wants to do things,
• 29:28
  Speaker 6: he is the flank of his party that really keeps
• 29:32
  Speaker 6: pushing for deeper and deeper budget cuts and doesn't want
• 29:36
  Speaker 6: him to work with Democrats.
• 29:37
  Speaker 10: But he needs to work with Democrats. So it's a
• 29:39
  Speaker 10: tough situation. But at the same time, we may see
• 29:42
  Speaker 10: something happen on tax policy.
• 29:44
  Speaker 6: There's a bill that went through the House Ways and
• 29:46
  Speaker 6: Means Committee, they actually marked it up, they sat down
• 29:49
  Speaker 6: and went through it last week that would provide business
• 29:52
  Speaker 6: tax cuts, making some of those Trump era tax cuts
• 29:56
  Speaker 6: permanent or extending them, and also the child tax credits
• 29:59
  Speaker 6: that they the Biden administration wants to see extended. That
• 30:03
  Speaker 6: may happen, and if it happens, it would happen pretty
• 30:05
  Speaker 6: quickly because they want to do this, particularly with that
• 30:08
  Speaker 6: child text credit, before the tax filing season gets into
• 30:12
  Speaker 6: full swing. So we may see some tax policy, we
• 30:15
  Speaker 6: may see an immigration bill. We have not had immigration
• 30:19
  Speaker 6: policy changes of any major sense really in twenty years,
• 30:24
  Speaker 6: but they need get this done. The Republicans are saying
• 30:26
  Speaker 6: they need immigration policy changes before they will even consider
• 30:31
  Speaker 6: extending or are giving more aid to Ukraine as well
• 30:37
  Speaker 6: as Israel and Taiwan.
• 30:39
  Speaker 5: Jody, thanks lot, really appreciate it. Joey Schneider, Bloomberg, Political
• 30:42
  Speaker 5: news director for TV and radio,