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Markets, Streaming, And Crypto (Podcast) · Bloomberg Intelligence

0:00
Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside
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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: on Apple Podcasts or wherever you listen to podcasts, and
0:18
Speaker 1: at Bloomberg dot com slash podcast. A lot for the
0:23
Speaker 1: markets to digest here right in the teeth of earning season.
0:27
Speaker 1: We've got the ECB meeting tomorrow, the FED. We're gonna
0:30
Speaker 1: get at something in July, I believe, is the dates
0:33
Speaker 1: of lots for this market to digest. To take a
0:35
Speaker 1: step back and put it on into perspective, Luca Paolini,
0:39
Speaker 1: chief strategist for pick Ta Asset Management based in London.
0:43
Speaker 1: He joins us, Luca, as we stand back here and
0:46
Speaker 1: start to really get into the teeth of this earning season.
0:49
Speaker 1: What do you expect to hear from companies? What are
0:52
Speaker 1: you looking for? What are you kind of paying attention
0:54
Speaker 1: to during these earnest conference calls that we're all listening to.
0:59
Speaker 1: What morning everyone, Well, I think you know the we
1:02
Speaker 1: tend to focus a lot on what company is gonna
1:05
Speaker 1: tell us about the consumer, I think we should actually
1:09
Speaker 1: look at investment because investment normally is the real driver
1:13
Speaker 1: would really create a recession. So I think from the
1:16
Speaker 1: consumer we know pretty much the fundamentals. We know what
1:19
Speaker 1: can go right, what can wrong. I think the real
1:21
Speaker 1: for me the question mark and what I want to
1:23
Speaker 1: know if companies are holding back on investment, if they
1:27
Speaker 1: are reduced in accounts, and I think in this especially
1:30
Speaker 1: discerning season, we actually expectations are quite low. I want
1:34
Speaker 1: to see the guidance and when I see companies telling
1:36
Speaker 1: us we are company enough or not company enough to
1:40
Speaker 1: basically expand, to increase basically to two to hire people,
1:46
Speaker 1: and that's for me, would be the focus because I
1:48
Speaker 1: think on the consumer we pretty much know the story.
1:50
Speaker 1: I think for on investments it's being very strong. And
1:53
Speaker 1: I think this is to me is the key things
1:55
Speaker 1: to watch, not so much the residence or not of
1:58
Speaker 1: the consumer. Are I haven't seen evidence that companies are
2:03
Speaker 1: holding path, that they're waiting to make that decision. And
2:08
Speaker 1: on the on the fringe, certainly on the West Coast,
2:12
Speaker 1: starting to reduce at least the pace of hiring or
2:15
Speaker 1: even cut back on headcount. Well we've seen obviously apple
2:19
Speaker 1: in the data. When you look at for example, capital
2:23
Speaker 1: good orders, I seen an outcome high. What is what
2:25
Speaker 1: has happened though that investment expectations or plans have been
2:31
Speaker 1: cut significantly, So again there is this kind of the
2:34
Speaker 1: data still looks very, very solid. I think, though I
2:37
Speaker 1: can see at the margin um some significant potentially reduction investment.
2:42
Speaker 1: But again that's where that's why I'm waiting for companies
2:45
Speaker 1: to tell us, because I think it's clear that momentum
2:47
Speaker 1: is lowing. But it's also clear that you know, you
2:50
Speaker 1: don't want to basically get rid of people, and it's
2:54
Speaker 1: so difficult then to rehire them. So I think it's
2:56
Speaker 1: very important for me to have a sense if companies
2:59
Speaker 1: are confident enough and and I think that's the key point.
3:02
Speaker 1: Looka here at Bloomberg, we really take a global view.
3:05
Speaker 1: Our audience takes a global view. We have important day
3:08
Speaker 1: from the European Central Bank tomorrow. What are you looking for? UM?
3:14
Speaker 1: You know, the European Central Bank as this incredible ability
3:17
Speaker 1: to disappoint UM. In the past two occasion when they
3:21
Speaker 1: create in July we had a recession. I think this
3:24
Speaker 1: time they'll have no other choice. I don't think that
3:27
Speaker 1: the interest rate, I I think it's more like, to
3:30
Speaker 1: be honest, for me, it's more likely to be fifty
3:32
Speaker 1: bus this point, because I think they want to send
3:35
Speaker 1: the message that they have in prestion under control, and
3:38
Speaker 1: at the same time they want to send a signal
3:40
Speaker 1: that they're there to help the terriphery. So probably that
3:42
Speaker 1: that's a compromise that will emerge from from the council.
3:47
Speaker 1: Twenty five or fifty bus point, I think it's pretty
3:49
Speaker 1: much the same. I don't think it would change anything.
3:51
Speaker 1: But I think also they're they're forced to take action,
3:54
Speaker 1: you know, with the Europe pretty much a parity inflation
3:57
Speaker 1: going through the roof, I think that to take action,
4:00
Speaker 1: But I don't think it's going to be a huge
4:02
Speaker 1: market mover. I don't think that would make a big, big, big,
4:04
Speaker 1: big difference for markets, to be honest with you. We
4:06
Speaker 1: saw the euro at least rally back through a dollar
4:09
Speaker 1: up to one oh three, one or two. Right now,
4:12
Speaker 1: Um does that kind of hold or do you see
4:14
Speaker 1: continued dollar strength here? I mean I'm looking across the spectrum.
4:17
Speaker 1: Right one, we're back up to the pound. Um still
4:21
Speaker 1: one thirty eight for the end, so still incredible weakness there.
4:24
Speaker 1: But does does d x Y continue to rise? But
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Speaker 1: I I do believe that the dollar is very very
4:31
Speaker 1: close to a major peak, secretical and and and also strategic.
4:37
Speaker 1: But you need, though, I think, to two things. What
4:40
Speaker 1: clear indication that you have inflation of peak. I think
4:43
Speaker 1: it does, but this is not the view of everyone.
4:46
Speaker 1: And second one we need to see a clear reacceleration
4:49
Speaker 1: in China, where the evidence is also not for people,
4:52
Speaker 1: is strong. So I do believe, and you'll be surprised
4:55
Speaker 1: at what I'm saying, is that the currency which has
4:57
Speaker 1: them what upside here is the end, the end, because
5:00
Speaker 1: the end that's been effectively killed by what but interest
5:03
Speaker 1: rate expectations going up everywhere else apart from Japan. And
5:07
Speaker 1: and if the reason if the global economies leaps into
5:10
Speaker 1: recession the interest really differential, we go actually in favor
5:14
Speaker 1: of Japan. And given that the expectation are solo and
5:17
Speaker 1: evaluations were attractive, I think and all sounds strange that
5:20
Speaker 1: the Japanese end could be the big surprise in the
5:24
Speaker 1: next three to six months for the year. I think
5:26
Speaker 1: there are too many risks in terms of the war
5:29
Speaker 1: in Ukraine, d C be Italy I think it's probably
5:33
Speaker 1: still a little bit too early to be bullish on
5:35
Speaker 1: the Europe. Look at real quick at thirty seconds happened
5:38
Speaker 1: fixed income. It's been a brutal first half of the year.
5:40
Speaker 1: Any opportunities there, Yes, there are, There are in some
5:44
Speaker 1: emerging markets like Brazil. I think also in some parts
5:47
Speaker 1: of the of the credit market. Corporate depth, especially in
5:50
Speaker 1: the US, Triple A names saved names, good yelds. I
5:55
Speaker 1: think still solid in a way, solely fundamental. Yeah, we
5:59
Speaker 1: start to see some values again, especially in the US
6:01
Speaker 1: and some parts of YEM, but we stay away from Europe.
6:04
Speaker 1: All right, Luca, great stuff. Always appreciate getting your perspective.
6:08
Speaker 1: Luca Paolini, chief strategist for picked A Asset Management. He
6:12
Speaker 1: is based in London. Why does everyone hate rats so much?
6:21
Speaker 1: Are they worse than squirrels or chipmunks? Yes? What did
6:26
Speaker 1: you say? Did you say poop? Yeah? I don't think
6:29
Speaker 1: you can say that. No, I'm not sure, but we'll check.
6:32
Speaker 1: Ken Fell. You says, maybe that's okay, okay. Our director,
6:37
Speaker 1: our global director, Ken Fellow says, you can, but let's not.
6:40
Speaker 1: Let's not. Let's know that's a brutal story, all right,
6:43
Speaker 1: Greg Jarrett, thank you so much. Here are we got
6:45
Speaker 1: a Federal Reserve meeting coming up, said July. I think
6:48
Speaker 1: that's the big one, Jennifer Leasy, and your economist, managing
6:50
Speaker 1: director of Demo Capital Markets joins us. Jennifer, I mean
6:53
Speaker 1: we're in the midst of earning season. That's kind of
6:55
Speaker 1: got investors intention here. Um, but again, we know that
7:00
Speaker 1: the real focus is on this Federal Reserve as we
7:03
Speaker 1: think about inflation, as we think about recession. What do
7:07
Speaker 1: you expect from our federal reserve? Good morning? And by
7:11
Speaker 1: the way, just on one funn'l know what you're saying earlier,
7:14
Speaker 1: how about raccoons? Yes, for the FT, I mean so
7:18
Speaker 1: for the Federal Reserve, I mean we so we expect
7:20
Speaker 1: a seventy five basis point Ray hike, Um, jesus next
7:25
Speaker 1: we call already, UM. I don't think um a lot
7:27
Speaker 1: of people anymore are thinking about a risk of a
7:30
Speaker 1: hundred basis point move, just given that we've seen the
7:33
Speaker 1: softer data lately. UM. In terms of what he the
7:36
Speaker 1: Fed Area is going to say, I think he's I
7:38
Speaker 1: would expect him to soften his um, his his points
7:42
Speaker 1: about the economy. I mean, last time we heard from
7:44
Speaker 1: him was that was in Centrup, Portugal, and he was
7:47
Speaker 1: talking about how the US economy was in strong shape
7:50
Speaker 1: and well positioned to withstand tighter monetary policy. And I
7:53
Speaker 1: still think that second point is probably still valid. But
7:56
Speaker 1: you know, we have again seen some weakening, you know,
7:59
Speaker 1: for example in the housing market, some slightly softer you
8:03
Speaker 1: know UM retail sales data last week, and those are
8:07
Speaker 1: the pieces of data that Governor Waller was what was
8:10
Speaker 1: talking about referring to in terms of what he was
8:12
Speaker 1: going to how he was going to vote next week.
8:15
Speaker 1: So I think centified basis points is probably the base
8:18
Speaker 1: case UM right now, and maybe soft softening is too
8:21
Speaker 1: a little bit on the economy. By the way, I
8:23
Speaker 1: have a bet with Critty Gupta um dinner of her
8:27
Speaker 1: choice that inflation has peaked. I think it. I think
8:30
Speaker 1: nine point one percent was the high rating for cp I.
8:33
Speaker 1: Do you think I'm at risk of losing that bet? Boy?
8:38
Speaker 1: I hope it is UM. But I think over the
8:40
Speaker 1: next few months the the yar year comfortables might get
8:43
Speaker 1: a little tougher UM. But I think for the July
8:46
Speaker 1: CPI UM report probably gonna see it pulled back, probably
8:50
Speaker 1: probably below the nine percent level, just given that gas
8:53
Speaker 1: prices to have. You know, we had some relief on
8:55
Speaker 1: the on that front at least, but again, broader measures,
9:00
Speaker 1: I mean broader measures in terms of the core measures
9:02
Speaker 1: are still quite elevated as well. So I don't know
9:05
Speaker 1: if they have completely hit the peak. But we've been
9:06
Speaker 1: saying Q three and I think I've been saying September ish,
9:10
Speaker 1: so I'm sort of waffling on that front, but you
9:12
Speaker 1: know that I'm really hoping that n would be the peak. Jennifer,
9:16
Speaker 1: what do you make of this U S dollar? I mean,
9:18
Speaker 1: it's the highest if you look at the d X
9:20
Speaker 1: Y and next the highest and almost twenty years kind
9:22
Speaker 1: of thing they almos put that into perspective and kind
9:25
Speaker 1: of how you think things may play out. Don't afford.
9:29
Speaker 1: It's got a lot of it still has a lot
9:30
Speaker 1: of tail winds behind it, just given you know how
9:32
Speaker 1: aggressive the FED is planning is still planning to be,
9:35
Speaker 1: you know, um raising rates expeditiously, and then when you're
9:39
Speaker 1: looking at it versus you know, for example, the euro
9:41
Speaker 1: even though you know everyone's expecting or we are all
9:43
Speaker 1: expecting the easy of you to do something tomorrow, you know,
9:46
Speaker 1: as your last guest said, you know, they have a
9:48
Speaker 1: habit of disappointing. Um. You know, this is probably a
9:51
Speaker 1: great opportunity for them to prove everybody wrong. But if
9:54
Speaker 1: they don't, you know, we could see you know, the
9:56
Speaker 1: euro dip below parody again. Um, the pound. Also, it
10:00
Speaker 1: is getting a little bit of a tailwind this morning,
10:02
Speaker 1: but at the same time it also has a lot
10:03
Speaker 1: of headwinds facing it with potentially eleven percent inflation coming up,
10:08
Speaker 1: and of course you know, much slower growth in the
10:10
Speaker 1: second half with inflation so high. So I think because
10:13
Speaker 1: of that, just us all broadly, I think still has
10:16
Speaker 1: some life left in it. By the way, there are
10:18
Speaker 1: many words we cannot use on radio to describe the
10:22
Speaker 1: European situation this winter. How much trouble is that economy
10:28
Speaker 1: in It's uh, that's one reach one area that I'm
10:32
Speaker 1: very concerned about, just because of that huge heavy reliance
10:36
Speaker 1: for too long, um on Russian energy. And even though
10:39
Speaker 1: they are now finally trying to rid themselves of that
10:42
Speaker 1: reliance by cutting cutting their their their dependents by two
10:45
Speaker 1: thirds by the end of the year. You know, I
10:47
Speaker 1: would consume you say, good luck with that trying to
10:49
Speaker 1: build all those lergy terminals when you're still having a
10:51
Speaker 1: big shortage of supplies and of labor. Um. But this
10:55
Speaker 1: is the one point in time in my life I
10:57
Speaker 1: will say that maybe it's a good thing that there's
11:00
Speaker 1: uh climate change um and global warming because hopefully the
11:03
Speaker 1: winter will not be really really bad and you know,
11:06
Speaker 1: and so the gas usage will not be as high
11:10
Speaker 1: as you know as the worst case scenario. But you know,
11:12
Speaker 1: this is one area that that for sure, I'm quite
11:14
Speaker 1: concerned about. Thirty seconds left gen Um, what's your recession
11:19
Speaker 1: kind of expectation? Is it above the US? For the US? Yeah, um,
11:27
Speaker 1: maybe a little bit over Um. We actually have a
11:30
Speaker 1: negative sign pencilion for the early next year. Um. Maybe
11:34
Speaker 1: not you know your traditional um two quarters in a
11:37
Speaker 1: row of negative growth, but certainly much flower growth, almost
11:40
Speaker 1: like a growth recession, as we have unemployment taking up
11:42
Speaker 1: a little bit as well towards the end of this
11:44
Speaker 1: year and next. All right, Jennifer Lee, thank you so much.
11:47
Speaker 1: We always appreciate getting your thoughts here. Jennifer Lee, Senior
11:50
Speaker 1: Economist and Managing director bemo Accoumpital Markets. Again the ECB
11:55
Speaker 1: meeting tomorrow, Bloomberg surveillance will be all over that in
11:58
Speaker 1: your early morning coverage you can rushed to short there
12:00
Speaker 1: and then of course we will definitely overcover the ECB.
12:04
Speaker 1: We love the e c B. Well, Christine looks some
12:06
Speaker 1: of us love it. Yeah, some of us love it.
12:09
Speaker 1: But again, certainly for European listeners and viewers, a big,
12:13
Speaker 1: big meeting tomorrow will certainly have all that. Looking at Netflix,
12:20
Speaker 1: I reported some numbers last night. I think the takeaway
12:22
Speaker 1: was it could have been worse. Um. Looking at the stock,
12:25
Speaker 1: the good news is it's up four percent today. The
12:29
Speaker 1: bad news is down on a year to date basis.
12:34
Speaker 1: Let's break it all down with Mark Douglas, President CEO
12:36
Speaker 1: of Mountain. Mountain is an advertising software company enabling brands
12:40
Speaker 1: to drive measurable conversions, revenue and site visits. So Mark
12:44
Speaker 1: owned by owned by Ryan Reynolds, acquired Ryan Reynolds Creative Agency. Okay,
12:51
Speaker 1: so Mark, how do we say this? I guess not
12:53
Speaker 1: owned by but you got together with Ryan Reynolds. Yeah,
12:59
Speaker 1: Ryan um chief creative officer or a Mountain. So he
13:03
Speaker 1: Um has made a lot of movies and I didn't
13:06
Speaker 1: want to do some other things, and he and I
13:09
Speaker 1: teamed up and he worked in Mountain working with a
13:12
Speaker 1: lot of our customers and obviously it's business strategy. So
13:16
Speaker 1: it's see I said it wrong. I said Mountain was
13:19
Speaker 1: owned by Ryan Reynolds. Actually Mountain bought Ryan Reynolds exactly
13:23
Speaker 1: exactly the work maximum method, Yeah, maximum effort. I'm kidding,
13:28
Speaker 1: all right, Mark, So again Netflix numbers last You know,
13:31
Speaker 1: the tide has changed here. It's not, you know, grow
13:33
Speaker 1: at a breakneck speed kind of thing. They're trying to
13:35
Speaker 1: adjust to a new world order in terms of a
13:38
Speaker 1: lot more competition that maybe the easy growth in terms
13:41
Speaker 1: of subscriber growth is is done. What did you take
13:43
Speaker 1: away from their results last night? Well, I think the
13:47
Speaker 1: one thing to take away is they still are twice
13:49
Speaker 1: as large as any of the competitors in terms of
13:52
Speaker 1: number of subscribers. So the number of subscribers is clearly slowed.
13:57
Speaker 1: I think Netflix people are are responding. Actually I think
14:01
Speaker 1: a bit more to how quickly they're responding, announcing the
14:05
Speaker 1: ads business, announcing um new ways of doing passwords sharing
14:10
Speaker 1: that that generate revenues for them. And so I think
14:13
Speaker 1: that's the big too, that overshadow that there's still been
14:17
Speaker 1: some subscriber losses in the quarter. And I think you'll
14:20
Speaker 1: continue to see that there's some growth in the stock
14:23
Speaker 1: as people see them acting decisively. Okay, Mark, how about
14:26
Speaker 1: this advertising opportunity for Netflix? Um a lot of analysts
14:32
Speaker 1: on the Walsherter saying this could be a big deal
14:34
Speaker 1: in terms of the new source of revenue. How do
14:36
Speaker 1: you think about that? Yeah, absolutely so. I think the
14:40
Speaker 1: opportunity here is it can be as potentially as large
14:44
Speaker 1: as Netflix's current revenues. So they have as much as
14:50
Speaker 1: of all viewing a TV has tone on Netflix. So
14:53
Speaker 1: it's just a huge amount of user engagement people watching
14:57
Speaker 1: shows on Netflix that they can potentially monitor size. Now,
15:00
Speaker 1: there are some challenges. All that content wasn't acquired by
15:04
Speaker 1: Netflix with advertising in mind, so they have to potentially
15:09
Speaker 1: get rights to do ads on that content. They have
15:11
Speaker 1: to like find places to do it. But there's also
15:15
Speaker 1: a lot of opportunity because they have no legacy advertising business,
15:18
Speaker 1: they don't have to have thirty second TV ads. They
15:21
Speaker 1: can choose any format with any content over time, and
15:25
Speaker 1: I think the revenue potential is at least as large
15:29
Speaker 1: as Netflix is right now in terms of their their size.
15:33
Speaker 1: What happened in this market yesterday I was at the
15:35
Speaker 1: crypto UM convention, and obviously crypto has been pooh pooed
15:41
Speaker 1: because of the incredible crash of bitcoin, but they all said, hey,
15:44
Speaker 1: you know what, it's nothing compared to Netflix. You know,
15:47
Speaker 1: Netflix has done much worse than than bitcoin, which I
15:50
Speaker 1: thought was a silly comparison, but um, it does show
15:54
Speaker 1: you just how much I guess froth was in streaming.
15:58
Speaker 1: Is it all across streaming or was it just net Flix? Well,
16:02
Speaker 1: I don't, I mean frost it's been I think it's
16:04
Speaker 1: a pretty strong term. You have to look at it.
16:07
Speaker 1: That Netflix lead of revolution. They completely changed the relationship
16:11
Speaker 1: between consumers and entertainment, you know, allowing on demand viewing,
16:16
Speaker 1: allowing you to get you know, an entire season the
16:19
Speaker 1: shows all at once, and so that innovation I don't
16:23
Speaker 1: think is I wouldn't perceive that as frosty. I would
16:27
Speaker 1: consider it that the market was crashing and Netflix announcement
16:32
Speaker 1: that we're having some subscriber losses, and you know, everyone reacted,
16:36
Speaker 1: and I think obviously they have challenges. This is not
16:42
Speaker 1: going to be easy to transition into having an ad
16:46
Speaker 1: supported price point for them, But I think the potential
16:50
Speaker 1: there is clear, and so I think Potentially people overreacted
16:55
Speaker 1: in terms of the sell off and Netflix stock, and
16:58
Speaker 1: you know how the not the price declines in the
17:02
Speaker 1: last quarter and you and you're starting to see that turnaround. Mark,
17:05
Speaker 1: what do you think about as we step back and
17:07
Speaker 1: take a look at the streaming business? Everybody and the
17:09
Speaker 1: brothers got a streaming service now, and they're all it
17:11
Speaker 1: seems like they're all named plus. Um, how does this
17:14
Speaker 1: shake out? I mean, are we going to have three players?
17:18
Speaker 1: Five players? Ten players? Are more? Well, there is a
17:22
Speaker 1: lot of consolvation. I mean if you look at like Netflix, Disney,
17:26
Speaker 1: Discovery Networks, NBC Universal, I think you're looking at like
17:31
Speaker 1: five companies or essentially half of the entertainment markets for
17:36
Speaker 1: for you know, and television viewing at home. So there's
17:40
Speaker 1: already somewhat of a consolidation. I think you'll see that continue. Um.
17:45
Speaker 1: In the advertising space, actually, the brand advertising market is
17:50
Speaker 1: not really growing that quickly, so you're looking at somewhat
17:53
Speaker 1: of a market share war. In other words, you know,
17:56
Speaker 1: when Netflix comes to this market with TV ads and
17:59
Speaker 1: Disney comes in the market with Disney Plus, it's not
18:02
Speaker 1: like Procter and Gamble is going to allocate more budgets
18:06
Speaker 1: for TV ads. So it's a bit of a market
18:08
Speaker 1: share war actually. So the opportunity is to expand the
18:13
Speaker 1: number of television advertisers to basically go beyond just these
18:18
Speaker 1: biggest advertisers or else it is going to be a
18:21
Speaker 1: bit of a fight and um, so they have to
18:24
Speaker 1: kind of do both things. They have to get into
18:26
Speaker 1: that market with the biggest advertisers, and they have to
18:29
Speaker 1: innovate with Microsoft in case case of Netflix and Disney,
18:33
Speaker 1: you know, with their Hulu division, um, in terms of
18:37
Speaker 1: to essentially expand the market, or else everyone's going to
18:40
Speaker 1: be fighting over the you know, the same pool of dollars.
18:43
Speaker 1: All right. So Mark Disney just came out a couple
18:46
Speaker 1: of days ago with an announcement they secured nine billion
18:48
Speaker 1: dollars in advertising commitments during its Upfront ad sales event,
18:52
Speaker 1: which happens kind of Mark May of every year. Uh,
18:55
Speaker 1: they're saying streaming played a big part of that. How
18:57
Speaker 1: do you what are your takeaways there? Well? I think
19:01
Speaker 1: the I mean, I know they love to announce up front,
19:04
Speaker 1: but I don't see upfront as a concept lasting for
19:08
Speaker 1: many more years. The concept what's that? But the the
19:17
Speaker 1: thing is is that upfronts were created because you have,
19:20
Speaker 1: you know, a certain number of advertisers that are looking
19:23
Speaker 1: for the same shows that the same group of consumers
19:27
Speaker 1: are watching, and so they could get people to bid
19:30
Speaker 1: against each other to get that. But when you look
19:32
Speaker 1: at streaming, you know, you don't target basic, you don't
19:35
Speaker 1: care about the show. You care about who's the consumer
19:38
Speaker 1: I'm trying to reach, and so you don't really need
19:40
Speaker 1: the upfronts in the same way. So I think, to me,
19:43
Speaker 1: we've reached peak upfront like that, like the parties on
19:47
Speaker 1: on going to be on the dep line, I don't
19:49
Speaker 1: think this is the any I think we've reached peak
19:51
Speaker 1: up front. But the industry overall will grow because the
19:55
Speaker 1: upfront models of fifty year old business model that is
19:58
Speaker 1: due for a change, and I think of change is
20:01
Speaker 1: going to our car. Yeah, it's some good stories, Matt
20:03
Speaker 1: from some of these upfront parties. All right, that's Mark Douglas,
20:06
Speaker 1: President CEO of Mountain getting the latest on Netflix again.
20:10
Speaker 1: Kind of a mixed report last night, but the you know,
20:12
Speaker 1: still talking about what is a growing streaming industry. Let's
20:20
Speaker 1: check out with Mike mcblown, senior commodity strategies for Bloomberg Intelligence,
20:24
Speaker 1: and he's one of Matt one of those of the
20:26
Speaker 1: cool kids that during the pandemic relocated from the Northeast
20:29
Speaker 1: down to Miami. And he's always, you know, boasting and
20:32
Speaker 1: talking a big game when we're freezing up here in
20:35
Speaker 1: January and February. Mike Howard things down in Miami in July.
20:40
Speaker 1: It's funny I came south. I can cool off in
20:42
Speaker 1: the summer. You guys are getting heat waves now, that's right.
20:44
Speaker 1: Wait are you here? I just saw you here yesterday.
20:46
Speaker 1: I was yesterday, but I had to come back to
20:47
Speaker 1: the rough digs here in Miami. It's it's tough, but
20:50
Speaker 1: you know, you got to do it. So do we
20:52
Speaker 1: have what do we have going on here in Bitcoin? Well,
20:56
Speaker 1: I think the big macro pictures. Bitcoin is one of
20:59
Speaker 1: the biggest bull parks in history that just had its
21:01
Speaker 1: biggest steepest discount to its Hunter week moving average ever.
21:05
Speaker 1: That was just a few days ago. And then you
21:07
Speaker 1: look over the other one of the biggest bear markets
21:10
Speaker 1: in history, crude oil had its steepest premium to its
21:13
Speaker 1: Hunter weak movement average ever and that was just a
21:15
Speaker 1: few months ago. And I think what we're doing is
21:17
Speaker 1: getting that reversion process now. So since we had that
21:19
Speaker 1: seventy five bases point hike which was last month, we're
21:22
Speaker 1: probably gonna get one next week. Bitcoin is up about
21:25
Speaker 1: ten and crude oil is down about ten percent. To me,
21:28
Speaker 1: that's what's going to continue to happen partly because of
21:32
Speaker 1: this is the macro the micro and the key thing
21:35
Speaker 1: I think to worry about it for a bitcoin is
21:36
Speaker 1: only if we get another big plunge in the stock market,
21:38
Speaker 1: bitcoin might drop. But it seems to be in the
21:41
Speaker 1: process that coming out ahead. And I think that really
21:43
Speaker 1: showed us last Thursday. Remember we had that bounce in
21:44
Speaker 1: the stock market. Bitcoin did it first. It's like Mattisman
21:47
Speaker 1: point out point in a lot. It's just a great
21:49
Speaker 1: leading indicator at the moment. Still is so you tied
21:53
Speaker 1: oil and gold together? Are they well in this year?
21:57
Speaker 1: And that's one thing I've enjoyed it. At a few
21:59
Speaker 1: conference people asked me why are you writing so much
22:00
Speaker 1: about Krudel. It's one of the most significant as people
22:03
Speaker 1: would say standard deviation moves versus the hunter week movement
22:06
Speaker 1: average ever in crudef futures and bitcoin, when I'm just
22:09
Speaker 1: seen as a normal discount in a bowl market, but
22:13
Speaker 1: I have to row open Krudel. So let's remember the
22:15
Speaker 1: beginning of the year, the FED was gonna hike twenty
22:17
Speaker 1: five basis points at every meeting, and then we had
22:19
Speaker 1: this massive spike in commandities led by Crudeil. Now they're
22:22
Speaker 1: hiking seventy five basis points at two meetings in a row.
22:25
Speaker 1: I mean they are taking up the sledge hammer on markets.
22:28
Speaker 1: They are it's a sledgehammer, and it's okay the stock
22:30
Speaker 1: market sponsor, that's great, but I think they're going to
22:32
Speaker 1: just keep tightens. The stock market gives up, and Bitcoin
22:35
Speaker 1: I think has had you know, it's pretty good bear market,
22:38
Speaker 1: but it's had the normal nuances you'd see in a
22:41
Speaker 1: in a you know, Nath and Technology were seeing that
22:43
Speaker 1: the leaves of some of the bankruptcies and stuff. But
22:46
Speaker 1: it's probably more likely just to come out ahead. It's
22:48
Speaker 1: this question of timing and Valtilly, what was your takeaway yesterday?
22:52
Speaker 1: I saw you at the Bloomberg Crypto conference in I
22:56
Speaker 1: guess what do you call? It's not Midtown anymore. It's
23:00
Speaker 1: like the Grammercy Park area district in any case, Um,
23:04
Speaker 1: what was your takeaway there? We saw some big names
23:07
Speaker 1: Um talking Jack Millers, I spoke with Sam Bankman, Freed
23:10
Speaker 1: spoke with Matt Levine, UM, Michael nova Grad spoke with
23:13
Speaker 1: Shonali Basket. What was your takeaway? Very similar Matt to
23:17
Speaker 1: what I took away from the SALT conference in Bahamas
23:19
Speaker 1: as lost the people in the space realized that this
23:21
Speaker 1: has got a little bit a bit overdone, in a
23:23
Speaker 1: little bit bubblicious, and we're personal bursting the bubble and
23:26
Speaker 1: out of that, so many people are so positive about
23:29
Speaker 1: the new technology, what it's gonna do, where it's gonna go.
23:32
Speaker 1: And that was my takeaway from UM from Sam Bankman, Freed,
23:36
Speaker 1: Nova Grant said, I really like telling you, yes I
23:38
Speaker 1: was wrong, but moving on, this is a pretty significant technology.
23:41
Speaker 1: And also on my panel, you know where are we
23:43
Speaker 1: a year from now when we get past this period
23:45
Speaker 1: of we all remember from the dot com bubble. A
23:47
Speaker 1: year from now, we've built a better system and it's
23:50
Speaker 1: about appreciation. Wow, So you were talking to us, but
23:54
Speaker 1: you're still a bull You're still But I wonder when
23:57
Speaker 1: you get when you step out of crypto bubbles, isn't
24:02
Speaker 1: it hard to keep being bullish after a drop from
24:05
Speaker 1: sixty whatever to well let's put it in context. We've
24:10
Speaker 1: dropped about twenty five trillion dollars from global equity is
24:13
Speaker 1: based on Bloomberg metrics, and we lost about a billion
24:16
Speaker 1: a trillion in cryptos. I mean now, right now, cryptos
24:18
Speaker 1: are a rounding error compared to what's happened in the macro.
24:21
Speaker 1: We've had the biggest draw down in the in the
24:23
Speaker 1: in the bond commodity, in the bond future, which is
24:25
Speaker 1: why I started in trading pits in the eighties. Ever,
24:28
Speaker 1: and well it's since nineteen seventy seven, so the markets.
24:31
Speaker 1: Bitcoin is part of the and cryptos are part of
24:33
Speaker 1: that macro. But the thing is, is the fastest horse
24:35
Speaker 1: in the race where is it five or ten years
24:37
Speaker 1: from now? So here's my bottom line in bitcoin. I
24:39
Speaker 1: fully expect this twenty thousand level is going to be
24:41
Speaker 1: like five thousand was the last beer market, and it's
24:43
Speaker 1: just a matter of time it gets two hundred thousand.
24:46
Speaker 1: Something has to change in the demand and adoption because
24:48
Speaker 1: the supplies declining, that has the prices have to go up,
24:51
Speaker 1: and I don't think that's going to change. I think
24:53
Speaker 1: we're just going to see more dip by ever, like
24:55
Speaker 1: do you ever go out to dinner with people who
24:57
Speaker 1: aren't involved in crypto, or like hang out with someone
25:02
Speaker 1: who's been burned and doesn't want to go back into
25:04
Speaker 1: Do you have a heart doctor? Maybe he has lost
25:06
Speaker 1: money on like Mike Novgress mentioned, well, a lot of
25:10
Speaker 1: people got over their skis the way I look at
25:13
Speaker 1: the bottom line for cryptos. If you're running and say
25:15
Speaker 1: a hundred newness of any acid, you don't have one
25:18
Speaker 1: or two of those units in crypto, you're at greater
25:20
Speaker 1: risk than not doing it. And to me, that narrative
25:23
Speaker 1: was kind of a smaller part of the bell curve
25:25
Speaker 1: maybe five years ago. Every day that goes by, it's
25:27
Speaker 1: an increasing nuance in the space. Realize, okay, I gotta
25:30
Speaker 1: get into space. I'm willing to buy dips in crypto.
25:32
Speaker 1: It's got the highest spade. And if if the market
25:34
Speaker 1: goes up bitcoinsrob we're gonna go up the most cryptos.
25:36
Speaker 1: Where will and where is it five ten years from now?
25:39
Speaker 1: Do we really think the will going digital is not
25:41
Speaker 1: going to adapt this global digital collateral? And then you
25:44
Speaker 1: look at the theory, it's really the bottom line for
25:46
Speaker 1: n f T S tokenization, which is the key thing
25:49
Speaker 1: on of my panel there's nothing to stop the tokenization
25:51
Speaker 1: of assets. Regulation will push back, but it's a matter
25:53
Speaker 1: of time. And the most widely trade to cryptos on
25:56
Speaker 1: the planet. The number one is the dollar. Key think
25:58
Speaker 1: I remember it's a token dis version over the dollar.
26:01
Speaker 1: All right, folks, everybody's out there. It's got a Bloomber
26:04
Speaker 1: turmal in front of them. B I Space, c O,
26:07
Speaker 1: M D GO. That's the commodities dashboard run by Mike mcglowa,
26:12
Speaker 1: Bloomberg Intelligence. It's got it all the soft commodities, the
26:16
Speaker 1: hard commodities, all this crypto stuff is the place to go. Well,
26:20
Speaker 1: he'll know if we had a peak. Do we have
26:22
Speaker 1: a peak in inflation at least on the material side,
26:24
Speaker 1: Oh sure, it's very close. In terms of commodities. Commodities
26:27
Speaker 1: are plunge. You look at copper down in the year.
26:30
Speaker 1: It's the most extreme versus a hundred week moving on
26:32
Speaker 1: average since the christ since Lehman collapsed. So if copper
26:36
Speaker 1: is pointing out that we're heading for a major deflationary perry,
26:39
Speaker 1: services is probably the problem. Right at least that's what
26:42
Speaker 1: I heard Tom Keen saying this morning that services could
26:44
Speaker 1: continue to rise in price. So all right, I could
26:47
Speaker 1: lose my bet with Critty. Alright, Mike mcglogan down in Miami,
26:50
Speaker 1: sweating it out with the masses, but probably no worse
26:54
Speaker 1: than here in New York City. I mean, I mean,
26:55
Speaker 1: try go down and so it was quite hot yesterday. Alright.
26:58
Speaker 1: Mike mcglowan, Senior Commodity Strategies bloom Intelligence. Again. That uh
27:02
Speaker 1: ticker B I, SPACE, c O, M D GO is
27:05
Speaker 1: all of the commodity research coming out of Bloomberg Research,
27:08
Speaker 1: and Mike has covered everything over his several decade career.
27:12
Speaker 1: The hard commodity is the soft commodities energy. Uh. And
27:16
Speaker 1: now he's really established himself, as you know, within Bloomberg
27:18
Speaker 1: Intelligence and within I think the industry itself, one of
27:21
Speaker 1: the leading research voices for all things scriptose. We appreciate
27:25
Speaker 1: getting some time from him. Thanks for listening to the
27:30
Speaker 1: Bloomberg Markets podcast. You can subscribe and listen to interviews
27:34
Speaker 1: with Apple Podcasts or whatever podcast platform you prefer. I'm
27:39
Speaker 1: Matt Miller. I'm on Twitter at Matt Miller. Put on
27:43
Speaker 1: fall Sweeney I'm on Twitter at pt Sweeney. Before the podcast,
27:46
Speaker 1: you can always catch us worldwide at Bloomberg Radio.