Elon Musk Sows Doubt Over His Twitter Takeover

You can also listen to our radio show at two pm Eastern Time on Bloomberg Radio, or watch us on YouTube search Bloomberg Global News. So Credit Suite, you know they have been announcing an array of management changes. We got that back in April, the departure as CFO, their Asia had their general council. Well, we just got a headline crossing the Bloomberg terminal and Credit Suits wearing the exit of the company CEO Thomas Gottstein. Uh. And we

have certainly done some reporting over the last month or so. Uh. Justin late April, the company's chairman Axe Lehman express support for that CEO. But this was a again a bank that has been overseeing a streak of profit warnings more scandals which have saddled the bank with losses worth billions of dollars, damaged its reputation for risk management, and triggered

a shake up of its leadership. So again, just crossing moments ago, a Bloomberg headline credit Sweet weighing the exit of Thomas Gottstein as soon as this year well, speaking of a leadership shake up. Twitter shares are down nine point five percent after Elon musk tweeted earlier this morning that the deal was on hold, this billion dollar takeover of Twitter. He did follow up a little bit later, saying that, you know, trying to clarify. I think when he saw that the stock was down and pre market

trading um that it's still proceeding. But let's get the details now with Ed Love. Though he's West Coast correspondent for Bloomberg News, he's with us from our Bloomberg nine sixties studios in San Francisco. At never a dull moment when you're covering Elon Musk, Um, I do wonder what the strategy is here, because if you think about this from the perspective of somebody who you know, you'd think would do some serious due diligence. Um, the problem that

he has is with the spot fake accounts. He's concerned that there are more than five that they make up more than five of Twitter's users. Um, wouldn't this be something that you kind of figure out before you make at four billion dollar takeover? Yeah? Well, first things first, Remember he waived due diligence, and we've known that for

some time. And and you're completely right, because there's only one point he's been consistent on throughout this whole process, which is he wants to remove bots from the platform. He's very aware of bots on the platform. But then to suddenly turn around and be like, WHOA put the brakes on, guys, it's weird. And I'll tell you why, guys. The the language Twitter used in its regulatory Friday Friday Morning is standard boiler plate. They use it all the time,

every quarter, So why now? So sometimes I think ed Elon Musk is just as he thinks. He just puts it out to everybody, you know, versus editing himself and saying what I you know, like most normal people like to do. But I'm just saying I do feel like synomons. It's the thought process and it just comes out. I mean, I don't know how so is he still committed to

this deal? What do we know on that front? And I'm thinking about all the investors who are lining up behind him, or the money that's lining up behind increasingly other people's right money, not his. Maybe Yeah, So I mean he tim tweet said, he tweeted by the way to clarify, I'm committed to the deal. So you follow it on a blow by blow basis to our listeners and tell him to get everything on social media. We should trust well, we have no other mechanism to talk

to him. Remember, there is no spokesperson, there's no sort of active press team. Um, go on the Bloomberg terminal if you're a subscribable and Bloomberg dot com if not, and read Matt Levin's column. According to Matt Levine Bloomberg opinion columnists, you can't just say I'm putting a deal on hold. Why you have a binding contract? That's it. Yeah, And I'm wondering what this has to do with price, because you know, the SMP five dred is down just

in the last month since April four. April four was the day that Twitter shares closed hired by after Musk took that nine percent stake, so it was before he made the offer for Twitter. This was a passive one. But I wonder how much this has to do with the broader route that we've seen in tech stocks, and if Elon Musk is using this as an opportunity to try to get Twitter for a lower price. Yeah, there

is a school of thought. Hindenberg short seller research company put it out there at the beginning of this week that this could be a sign of Elon Musk potentially coming back with a lower offer. You know, Twitter has not been caught up in the sell off in technology stocks because it's pending a deal, right, and you look at the spread between the offer price fifty four dollars twenty cents and the current share price, it's getting wider wider, wider,

especially with today's sell off in Twitter stock. And that's an indication, a soft indication that Wall Street is betting this deal is not going to happen, at least not in its current form. Yeah, I mean, I just feel like, you know, it's interesting. Um David western Um talking to a guest earlier, Eric Gordon, who follows M and A and teaches it to students and was like, how do

you teach Elon Musk to business school students? And you know, he's just got his own rules right ed. And I think about you folks who have to report on him, Like how you have to interpret these things he does well. I mean, it's the lack of sleep that's the hardship, it's not the interpreting. Um, let's remember, let's recap the reporting, multiple media reports, the FTC. The SEC are looking at the deal and how Elon Musk steaks was acquired and communicated.

So you know, he's not free or above the law, but he does have his own way of doing things that is atypical for an executive of a large publicly traded or private company. And we have thirty seconds left. What's happening inside Twitter right now? Yesterday the CEO let go of two executives there. What are you thinking if you're working at Twitter right now, They're hiring Freeze, they're re sending offers take us into it. Yeah, I mean

I'm hearing that in some respects this business is normal. Um. They're surprised that Elon Musk didn't know about the bots. It's a kind of well known thing. Internally. Um, but they're bracing what Twitter looks like. You know, there was expectations that some management would go and we're starting to see that play out now. Yeah. Anyway, all right, it continues the story that continues to give and give and give. Sleep from Ed luve Blow. Yeah, yeah, it doesn't seem

like Elon must look sleeps at all all. The West Coast correspondent Bloomberg News Twitter share of selling off Tesla shares. They're rallying. This is Bloomberg. You're listening to Bloomberg Business Week. We've Carol Masser and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio. We're still in a pandemic everyone, and COVID is searching again in the US. Reinfections a chief culprit. Let's get to it. Dr I los Bader is clinical Professor of Medicine at n y U Landgoing Medical Center.

On the phone from New York City. My guess is thou e and first of all, great to have you here with him and myself. You would say it's okay to be out and about. Well, uh are now it's always fair to be prudent, Happy Friday. But Carol and tim and two years ago we did talk about that everyone would be getting COVID eventually. I certainly did not anticipate all of the mutations and the O macron sub variants that are coming out. And I think we are we are certainly seeing and I'm seeing in the office

more COVID infections a lot of people. I think we're under counting because people are testing at home. The home tests are fairly accurate, and so we really are seeing a surge. Some of those people. We are getting taxl of it for you're older born, firm underlying disease, but a lot of people are getting it, and I think, um, you know, going out to big venues, you know, does pose some risk. Fortunately, most of these omicron infections are like that cold sinus cloth, sore throat. We're not really

seeing a bump in the deaths. We've had enough deaths, you know, a million in the United States, fifteen million excess deaths around the world. So uh, this has been quite ago. But it's frustrating that despite people who have had vaccines two or three, and people even four vaccines, or if they've even had COVID, they are still getting O Macron And that's been very frustrating, So going out to concerts. Probably it's not a zero risk, let's put it that way. And we've seen it front and center

with our colleagues. Ten Yeah, we have, um I mean, and it's not just in the data. Anecdotally, we've had more and more colleagues who are getting sick dr les better. Why is it so difficult to get packs of it? Still? Uh Well, typically we try and reserve that for people who are older sixty five or of underlying medical problems. I have not had that much trouble getting it. We use a specific pharmacy, which I'm not going to mention on air, but who do seem to be able to

get it for most patients? As patients over sixty five you're saying, or with underlying conditions, not necessarily like you know, if I'm under forty and I got it, I wouldn't be able to get packs of it. It's it's much more difficult um A. You have to upload and document one that you have a positive test. Um. I have a few patients who are under forty or or under

sixty five, we're getting it. In general, most doctors are trying to reserve it for older people, because most young people do seem to get through it, you know, seven to ten days, that's the quarantine. They may have some residual you know, cough. I've had patients coughing for several months after. Unfortunately, we don't have great treatment for post COVID or long long haul at this point, although we're looking at a number of things. But yes, young people,

it is harder to get pack lav it true. You know, we have a Bloomberg story out there and it says experts say that it's difficult to know what the next few months will bring, uh and just says how the virus is not behaving the same way it has in the past, and the majority of the country is living

like the pandemic is over. How do you think about I don't know the next the rest of the year in terms of what we might see when it comes to the pandemic, you know, I think we should be focusing or if I were in leadership, I would try and encourage an omicron vaccine or a universal COVID coronavirus vaccine because clearly this virus is mutating faster than we thought. People are getting reinfected multiple times. As for the Bloomberg article.

Even natural antibodies are not providing protection, so and paxl of it is in limited amounts. So I think we I think vaccines can be helpful, but they have to be more of a universal like universal flu vaccine or universal coronaviru respect scene. And I would say if you are elderly or from be careful going to concerts. You know, so outdoors said certainly safer than indoors, and be prudent.

I just say, I'm getting ready to do some traveling outside the country, and it's it's pretty there's strict rules out there. You got those masks ready. I have the masks ready. But going into a country and then coming back to the US, I mean they want to make

sure you're not carrying stuff around. I hope you don't get stuck in some beautiful location for ten days because you just continue to test positive comment Sorry guys, still positive, Maybe with like a nice beach or tropical climate comments comment. Dr Iain LUs Bader, thank you so much, clinical professor of medicine and go to for us throughout the pandemic. Key's over at n y U lend Going Medical Center. This is Bloomberg Business Week with Carol Messer and Bloomberg

Quick Takes Tim Stinovic on Bloomberg Radio. The remarks in the new isshue of Bloomberg business Week really taps into what has been going on in the trade and kind of where we are right and and our markets actually starting to make some sense at this point. Well, that's the question. I mean, the valuations have certainly come down a lot. Michael mackenzie is rates reporter who covers the bond market here at Bloomberg News. He joins us on

the phone from New York City. He's the author of the remarks in the current issue of Bloomberg Business Week magazine. It's available on newstands, on the Bloomberg and at Bloomberg dot com Slash business Week. Also with us right now is Joel Weber, editor at Bloomberg Business Week. He's with us in the Bloomberg Interactive Broker Studio. Joel Ober, the editor of the magazine. Joel Um. The party well today notwithstanding um, but you know these are sort of characteristics

of bear markets. The party it's over? Do we know if it's over? I mean, we may have time. This article so perfect, guys are perfect with time man. So should We talked to Michael this week, and obviously this has been a really interesting week to watch things continue to fall. We've seen weeks of declines. Now everyone's kind

of looking for that bottom. And you know, in our business week way we were we were like, we're in the hangover right, Like this is It's been a decade long party, easy money, free money, memestocks, crypto, everything was just you know, so easy. And when we started talking to Michael about this, it's like, yeah, this is gonna it's there's a turn that's happening, and inflation, interest rates, all of these things is going to make it much

a much different, more difficult environment. And and when we talked to Michael about that, we were like, oh, yeah, that the hangover is here. Uh and maybe we're already on the other side of that hangover and more powering through on this Friday, Michael. But what were the elements that really stood out to you as you dug into writing this story. Well, I think what I've always enjoyed being a financial genus out for twenty years. It's like

you do get to make people during that journey. A lot of them has been around mother than I have and so people like David Drew a tro price and wha why not at research serious? You know, they've been sounding the quarter intel for some time. And so when I was thinking to them a year ago on other stories, they were currently, well, it's just things are too easy,

the mean stock to start phrase, cryptocurrencies. Everything suggested to them that things are getting very, very hot, and it was time to sort of raise cash and focus on values, focus on doing your homework and prepare for for rougher waters. And I think what you know, if you look back to what happened in two thousand, what happened before two thousand made a lot of the market turmoil you do get comes when the Fed Reserve decided you to start

raising rates. It has to tighten up the cost of money. And I think we've been through an extraordinary period since the pandemic. We didn't just get zero interest rate an enormous amount of bombying from the FED. We got it from other global central banks, some of whom did quantitative

easy for the those first time, such as earlier. And we also had a huge amount of fiscal stimulus that came the cities in the US, and that combination has given us a legacy of near double digit inflation, and you've suddenly got a federal reserve that has a dual mandate. It's looking there to make sure the employment market is strong but also price stability in the form of an

inflation rate around a target of two. At the moment, they're doing very well on the employment side of that dual mandate, they're not doing very well on the inflation side. So it's very reasonable as an investor be thinking, this is a FED that's really focused on one thing, and

that is getting inflation down. And this is why we keep hearing more and more references back to what poor volcadicament view was share of the said reserves in the late seventies and eighties, when he really did crack the wid and in the end got inflation down, but at the cost of a very hard landing for the economy. And I guess right now the market is called in this environment, is the said going to be able to secure a softer landing, and therefore evaluations will continue to

under pressure. But there's probably a time now to start scaling into some of the things you'd like and which do look cheap um. But the risk here is that we get a harder landing, so it could be for the Hall to come likely and credit. Michael, That's what's been kind of interesting to watch this. We have just talked NonStop about inflation, inflation, inflation, and so of course the FED has to be aggressive when it comes to

interest rates. I feel like that the conversation, especially in the last week or two, has aggressively and increasingly moved to a wait a minute, FED raising rates, what happens to growth? And that's what we're all focusing on that the now we're looking at probably some kind of slowdown, and who knows what kind of a slowdown and how

long it lasts, how deep and how long exactly. So I mean a lot of people are sort of looking at the template of team where the Fed raising said times rates around two and a half per cent, and we had an I guess, the tantrum in both equities and credit, and the FED stopped, but they also could

see that the economy was really staring down. I think what's problematic this time is that rent and shelter about a third nearly a third or how the US calculates consumer price index, and we've had an explosive housing market and that re announcing rent increases through big sings big cities such as New York and San Francisco really taking off. It's also happening in the areas of the country where people have moved to because they have a more flexible

work environment. They can work from home, so Florida, Austin, Texas. So you've not got to rent and housing price problem that's feeding through into CPI and could very well continue for much of this year. So you don't have a situation where growth is slowing that inflation remains high. We also still have a war in Ukraine, which is putting

pressure on commodity prices, particularly food. Now the flip side, of course, is that high super crisis tend to eat into people's into people's persons and walls to excuse the time, and therefore that will slow the economy. But I think it's a very clicky time and I think it's This is why when I was talking to investors, their sort of view was, I'm taking long term view and I'm going to scalely in the areas that I like. I'm not going full in, but I'm starting to scale in

because we've seen enough of a fall now. But they're also adopting a sort of our strategy here that there could very well be further drops, but from a sort of if you sort of take a three to five year time horizon there, it's usually these are these are the times to buy. You can hold in the next three to five years, you'll be You'll come out of that um looking far better. So the album, the famous album was start making sense? Do markets finally start making sense?

Michael really quickly? Like seconds? Um, I think a year ago we had what sixteen crew the negative eut in bonds. He is now down to about only about sup treally now, um, that's the word. Best thing that tells you that they're starting to make sense when we no longer have negative viewer in bonds. By you're paying someone so your money is ridiculous. I think that's the key. That's killer and

so perfect. After what a week, Bloomberg Business Week editor Joel Webber in studio, thank you, And of course that voice you just heard Bloomberg News Rates reporter Michael Mackenzie on the phone in New York City. That is the remarks. The new issue of Bloomberg Business Week out now. This is Bloomberg Radio you're listening to Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio.

Crypto though for equities, it's been a vault to work for a lot of asset classes, including the cryptocurrency markets, we have seen kind of a crazy week, to say the least. We've got a great voice to join us to talk all things crypto right now. Giante Sue is the co founder and CEO of alex It's a decentralized finance de FI platform for bitcoin. Santa, Good to have you with us. How are you, Hi, Carol, Hi Tiam. Thank you for having me join you today. Yeah, thanks

so much for joining us. I want to go back to something that Carol shared from our colleague Mike Reagan, senior Markets editor here at Bloomberg, about a story that he wrote earlier this week. One point eight trillion dollars is the value of cryptocurrencies that has evaporate evaporated since the market top to three trillion dollars in early November. That's more than fifty drop, according to coin get Go.

When I see numbers like that, I think to myself, this as Mike Reagan rights could be a turning point in the crypto industry. What do you think? Well, I think the overall my care team is that it is definitely undergoing a massive correction and largely due to you know, delayed fat high tried to curb inflation. And crypto is highly correlated with tech, which is an injurery sensitive sector. So we're interesting, right, you know the value of those

future and the is greatly discounted. Let's just face it. The macro environment is challenging on several fronts. The conflict UQUES, slowing growth in China, US and other central banks are tight or they are tightening. So all these are contribute to the pencil of were seeing not just incredible, but you know, the global market as a whole, So I would say the downside race to growth definitely dominates, with very very limited upside for crypto and for the whole

market as well. You say we shouldn't think about what's going on um with crypto right now as a Leman moment. Is that fair? Um? That's my personal opinion, Carol, because you know, interestingly, people does people do associate this, particularly the collapse of the terror stable point u S t with LIMA moment. Right, my prisents of personal opinion is the folling care is that first of all, you know, when we define LIMA moment, we think about the market suddenly.

I understood at that point that the government will not fail our Lima as it has already done so for Bear, Fannie and Freddie. In crypto, there has never been any talks that the other one would you know, save us or stabbing with spellouts. Um. So that's what I think. That is really not a Dima moment. But the only thing I would say is, you know, do you think investors understood the risk here? Uh in what is turning out to be and has been a very volatile market

with the you know, true possibility of losing everything. Yeah, I um, I appreciate this terror. I would say two things. Number one, this terror ust collapse. It is a it's supposed to be a stable coin, but it is turned out to be not to be a stable coin. Right, so when we talk about the terrors collapse, first of all, it is our recently stable coin and it turned out that it's not well designed, so it did not survive this.

A market fell up. But if you look at other stable coins such as U S d C. It's back one to one with US dollar reserve. It continues to maintain the very stable value. But also number two about crypto itself as a whole industrial sector. The value of cryptocurrencies depends crucially on our perceived likelihood of they becoming more widely used in the payment system, so that perception can fluctuate dramatically. Right, events like Terra's collapsed push the

likelihood further into the future. Yeah, well, I wonder if it's there's two sort of issues here. One is the lack of confidence that people might have because of what happened with Tera. I was talking about the reddit posts on uh the subreddit for terror Luna, and there are people who are in despair because of the money that they've lost, people who've lost their life savings according to

these posts. I wonder if it makes it less likely for cryptocurrency to be adopted widespread by financial systems around the world because of the volatility that we've seen because of the more than fifty draw down. And this is we've got what non inten cential banks exploring the possibility of creating your own digital currencies. I mean, it's moving ahead. Mmmm yes, by heart broken. You know when you reason treature and ready people lost your shags. They will even

talk about suicide. So you know, as a builder bitcoin in a defact protocol, I really really I am heartbroken, but I want to save this number one. UM you know yell and came out to come and some you know possible regulation, particularly on stable coins. I welcome professor yelling comment. Why because stable coins are supposed to be packed to the SIA dollar. And I believe cryptox industry as a whole welcome regulation that are clear but not

limiting the innovation of crypto. Right the cryptal practisers want to become from like myself, like our protocol alex build on people. We welcome regulations because greater clarity will accelerate the adoption of printle by retail and institutional investors. But it's just as important that this regulation they are not regressive. So trackonian that you know, us end up lacking itself out of this open crypto networks. Okay, UM obviously will

have to do more in the future. She anti su shes conancy of the fintech firm there are focused on crypto investing. It's called Alex. She was the global head of Quantitative Investment Strategy research over at Morgan Stanley h And what was a wild week, certainly when you think about stable coins. This is Bloomberg Moro Journal now. But let me drive. Oh no, no, no no, no, all right, please, I'll dovel. I want to drive. Its good question. This is the Drive to the Globe on blue Bird Radio.

Right just about thirteen minutes left in today's trading session, we're getting ready to trump wrap up the Friday trade. The week overall a volatile week and even a volatile day. We are bouncing around, uh, flipping back and forth here with just a few minutes to go here, but we're definitely off our worst levels of the session, near our highs. In fact, Yeah, the nasdak up more than three point six highed by two point three percent, in the Dow

hired by one point four percent. So we're seeing that rally maintain at least late in the day. Let's get into it with the Victoria Green, the chief investment officer at G squared Private Wealth. They've got five fifty million dollars in assets under management. Victoria joins us once again on the front from College Station Texas, Victoria today is it Is it better than yesterday because we're seeing more green on the screen. Well, yeah, I'm just hoping we

don't jing fit. Man, this last thirty minutes of the market has not been kind, so I'm kind of holding my breath here. I know we only have thirteen minutes to go, but I'm like, come on, baby, just hold onto this rally. Why is it important to you? Why is it important to you that this rally is held onto at the end of the week here. Yeah, well, so there's some important supports on the SMP five hundred around thirty eight hundred that held this week. Um, and

we kind of want to relief rally. You know, it hasn't if you look at the pattern every single day this week, it pifically didn't necessarily start off bad and you even have decent games sometimes through lunch and then we chiled off in the afternoon. So this will be kind of breaking this powder and of just four down days and pretty miserable week. You know, even with this relief rally to day, they're still looking at index is

down two to three percent on the week. You know, in the Nassas looking to line up their six straight weekly loss of most What are the important um, you said some important sup ports? It think holding? Did you say this week or just today? Uh? No, this week? So we were really a little nervous yesterday level on the SMP five that's a pretty big retracement level we

were hoping would hold. Uh and it did today. It's just kind of putting a little bit more room between us and and today is really one of the first times in a long time we've had a rally that's held, and that's just kind of as a nice little relief and kind of helps April go from down eight to six percent, you know that to now the week is is looking two to three percent, and that that just makes it a little less worse and a little easier

to take some time off this weekend. Well, I do I agree, like I would like to see some boy, I mean, listen, I'm not seeing what I would like. But you know, I've got a four o one K and unfortunately, well I understand that there are two sides to the market. I'm not trying to be just buried stuff in the backyard. I thought you exactly. You just you found the crypto and you buried it's all under my mattress. No, but you know in terms of I mean the thing is right now, we're trying to find

the bottom. We're talking about market capitulation. I mean Apple getting just decimated. You know, that was something we've talked about a lot this week, right, you know, officially in terms of how much it has fallen? Um, how much are you guys talking about market capitulation? What to you? Says? Market capitulation? Victoria. So unfortunately, I'm not to put a

damper on this lovely day to day. But typically you need to have a ninety percent down day, which we haven't had, as well as more breadth of selling if you look at the number of stocks trading below their ten other day moving averages, as well as value holding

up very well. It's it's not necessarily the indiscriminate sailing you typically see when you get a capitulation, because the capitulation is just people throw off their hands and say, Cathro if I'm done, like I gotta get out of here, and I just have to sail because I can't take it anymore. We are starting to see some of that, right, some We did see equity outflows this week and last week.

Then you are seeing you know, clients start to want to give up on some position and moving into bonds right into moving into bond funds, and talked about that or there. I mean you're still seeing, you're still seeing how you'll come out, I'd say selective bonds, treasuries. You know you're seeing that flight to quality to all about a twenty basis point drop in the ten year this week, uh, and which is is good signs. But if you look for the historical when is the bottom? You know, yes,

to support hell, but is it conpitulation? Not to sound bad, but typically it gets a little bit more ugly and then everybody just wants to throw up and give up,

and then that's that's the bottom. Okay. Um. Victoria helps settle something for for Carol and me because during one of the breaks we were talking about valuations off air, about price earnings ratio for the SMP five D. We're using the Bloomberg to pull up the PE ratio for the SP five in at twenty right now, um, which is the lowest it's been roughly since you know, the coronavirus pandemic recovery back in back exactly rely exactly two years ago today, but it's still historically high, right, So

is it fair to say that stocks are so expensive by at least this measure. Some stocks are still expensive, absolutely, but you also have to just count in the low rates we still have. And yes, rates are coming up, but come on, guys, we're not even able to keep a book free on the tenure if you look back at worically, this is not a high rate environment. And I think that's the debate is where's the peg and settle? Some of that ends up with how where a rate's

gonna settle? And with that discount looked like, and how much do we want to pay for that dollar earning? I mean, I think because this SMP five is so heavily capuated to tech stocks and growth stocks right now, um, it's probably a very reasonable valuation of considering where those have fallen and when with their growth trajectory looks like

it for the future. Uh. And because they're so heavily weighted to Teck versus I mean energies like what three percent of the SMP five hundred financial some of your more historical value stops, you know, I know, this is our broad base, this is the market. The SMP five hundred, but it's really not. It's very close to the nast back and the rustle or one thousand growth. And so I think someone is taking back and not to be existential. But what is the market, so you want to say,

is it fairly valued? Tech? Maybe not? Other barstood market absolutely and almost pricing in a recession at this point? What do you make of something like bank stocks which are down about twenty or so this year and more so, I'm just looking at the high here, oh one thirteen, doing some quick math here on the Bloomberg uh, and we're seeing them down even more so if I if we look at the high back in January. I mean my assumption was rates going up good for banks? Um?

But is that telling you the nervousness about the growth picture recession? Maybe lower loan demands slowdown? Is that what that tells you? So? I mean mortgage rights have certainly spiked. What is it five point through now that we've been so spoiled this last decade that five point three is like an astonishing number two was now you backed that out thirty years any one of us would have been

happy in get up five set mortgage right. Some of this stuff is all relative, but I think financials should do a little bit better. I mean, the kW Bank index is down from January this year. That's huge. Yeah, and some of that is you had the issue with Russia and sanctions. You had some write off and that hurts some of the financials. Then you had the curve not really doing what the curve does to help financials, and that ended up, you know, with the concerns on

inflation and what rates were going to do. The trajectory became so uncertain. They didn't really get this boost they usually get during a rising interest rate environment because trust me, you're only gonna still make your point. You're a one percent interest on your checking account, but they're definitely going to charge you a lot more on your loans. So they should be making more. Their margins should be doing better. But you also didn't see consistent results during earnings, right.

You saw them starting to shore up reserves. I mean, thanks did not sound super happy about the world. They were more you know, putting more in their reserved budgets and generally reducing risk, which is not necessarily a good songt But is that a canary in the coal mine. I think it's because they're so regulated now that they

kind of have to react. First, I think we have a much more cautious banking industry over here in the US than we used to ever have, right oh eight, I think forever is earned into everybody's mind in the financial industry. Um so slight canary in the coal mine. But I think it's also a little bit the way that their industry reacts now to potential bad news. I mean, remember what they set aside for the coronavirus sauces. They're very quick now they start raising reserves and moving a

little more conservatively. You don't really have over here aggressive banks anymore. You and then you look at what's happening, was like, say your credit poeee you Deutsche Bank that tend to be a little bit more aggressive what they they're doing, and they're struggling, But you know, I'll take a U S Bank over European Bank any day, Victoria.

So it does look like and here we are, you know, less less than about four minutes ago until the market closes, It does look like the rallies holding the nattack hired by three point six, the SMB five under hired by two point to the how high at one point three. So what's the message that today's rally is sending about how you're feeling about where we are in terms of capitulation. I still don't think we're there yet. Uh, you know, I'm not sure if we're not going to give this

back up next week. I really hate to be a Debbie Downer on a Friday afternoon. I kind of just feel like I should lie to you right now and be like, no, don't here at the bottom. So the vic the Vix, hey, you know, Victoria the vix being down three points on us today We're at twenty nights and just dipping below thirty on a day that was volatile. Again, Like, I don't get that. There's a lot of disconnect. Cryptocurrency

was supposed to offer that inflation. You know, they're all of these should haves in the market, and sometimes the market just is its own, its own beast, and it really has a mind of its own. And so that's why sometimes it's better to grin, embarrass and stay invested, because what is logical is not always what happens. I mean, some if you backed out and said, Okay, this is what's happening in the world, where do you think the markets would be I still think people would think we

were at a massive question at this point. So sometimes you have to remember the markets don't always react to news the way we think or rational um. And we definitely do not have a rational stock market right now, because you do have some indiscriminate selling of stocks that make billions of dollars and strong earnings and great balance sheets. It doesn't matter that most of them are going down hostefully.

If you're saying an apple, just quickly, just got about twenty seconds here, So next week for more FED speakers, a retail sales report, what's going to be on your radar just quickly? Yeah, I mean they gotta put seventy five bases points on the tables they got, they got a man up. They gotta get a kind of inflation. I don't think they're gonna do it, but in place

you know, the FED, don't fight the Fed. The Fed's tightening here, So you've got to realize, you know, up hill and a bowl market is running into a major FED headwind. All right, we're gonna leave it on that now. Always fine. Victoria gree And Chi's chief investment officer over chief Squared Private Well fifty million dollars in assets under management,

joining us on the phone from college station Texas. Got a man app although even yesterday Marketplace, even with that interview in Marketplace yesterday he reiterating it's not going to be so many five, but he could change his mind. He could change his mind. Still got a few weeks right before the next meeting. All right. Thanks for listening

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