Mattel President Sees Cross-Generational Growth

Bloomberg Business Weekend iTunes, SoundCloud, or Bloomberg dot Com. You can also listen to our radio show at two pm Eastern Time on the Bloomberg Radio or watch us on YouTube search Bloomberg Clovel News than keeping a watch on Mattel shares, by the way, or up about since a recent low last October, They're up six percent year to date. We've often checked in with the company CEO, and we've got another key member of the c suite. Our next guest, who we last caught up with about a year ago.

Great to have back with us at the president CEO of Mattel, Richard Dixon. He's here in our Bloomberg Interactive Broker studio. How are you. I'm well, Thank you for having me. It's good to see in person. And be here with everybody in person. It feels like it feels like a little bit more normal. It's definitely more normal, but out of out but the world not so normal for sure. Well, it's a new normal because it's changing

every every every day. So talk to us about this new normal, Like, what is it in terms of running a company in this environment where things feel like they keep coming at us from all different angles. And maybe just as we start to feel like supply chains so important to you guys start to ease, you know, then they get kind of upended again. So what's this like? Well, look, I think we're all dealing with lots of changes, both cultural, systemic political. You know, we're living in a day and

age where nothing is the same. There is a degree of excitement around it as well. When you're running a company, the pivots, the flexibility, the degree of speed and which we need to move and make decisions, Particularly for a company like Mattel, which is this storied, legendary toy company.

We've got, you know, an unbelievable portfolio of legendary brands that, as we look at them today, are probably one of the most you know, pop culture relevant conversations that are happening in the world, particularly in toys, but as we extend our brand into entertainment and content digital gaming, it's been a really exciting time for these storied brands to

become part of the pop culture conversation. And f t s and f t s are another part of our dynamically, you know, growing business and and most importantly, I think as you as you think about it today, purpose really does matter. You know, you hear a lot about that. In fact, that walked into the office of today and you have a big, you know, display of the purpose of Bloomberg. And I think in terms of toys and what they represent people's lives, um unlocky imaginations, cognitive, social

emotional development, creating relationships with parents through toys. It's a really important part of development that we feel a great degree of responsibility for it. This time, we've gotten to talk a lot with the non crisis CEO of Mantel over the last year or so eighteen months to understand the changes that you guys have had to make when it comes to supply chain and making sure that you are able to deliver on those experiences and on those

toys throughout the year. I know that you're doubling employment in Mexico right now, and I'm wondering if if you have start, if you've actually opened the plant there. If you have, m are considering making other moves to Mexico to help e supply chain challenges right now, So you know, it's it's a great question. And I think part of the strong performance of our supply chain this year is attributable to our scale, our expertise, and our flexible model.

We've spent the last several years through a capital light program consolidating our footprint geographically. We've re oriented much of our manufacturing footprint to be more flexible, and as you mentioned, recently expanded our facilities in Mexico, um and for a variety of reasons cost reduction, consolidation. Obviously, close to shore helps with shipping and speed to market um and in general, I think the supply chain for MATEL has been a

competitive advantage. You know, while the world is dealing with incredible challenges both in supply chain issues inflation issues, I think the performance that we've had in our supply chain has really proven that it's a competitive advantage. From attel, you guys were doing this prepad nemic, weren't you. We've been working on this for several years. It's part of

a capital light model, that's correct. How much of though the tensions the geopolitical this is one of the big macro rethinks that we're having right now about we're seeing it certainly the energy market, I mean energy oil obviously very important to plastics as we know. But how are you rethinking about kind of where you're getting things because you're like, you know what, geo politically, we can't say

globalization is going to cure all that helps us? How much of that is also at play in this that might make you do even more aggressive moves in terms

of protecting that supply chain. It's a really important part of our strategic roadmap, and I think as you've seen over the last several years, by example, you know, through consolidation as well as geographically expanding our footprint, UM offsetting if you will, any reliability on any particular market whatsoever, and in fact, m opening up various different plants in different countries for the same brand and gives us the flexibility, the nimbleness that we need UM to accommodate and to

always keep the business moving despite political issues that may be arising in local markets. It's proven incredibly effective, particularly our performance in one We're in a quiet period currently, but you can see the performance in large part due to our our ability to effectively get product to consumers and retailers on time. So if there's a problem somewhere, it's very easy to say, Okay, plant number A, you've got problems plant number eight, We're just gonna amp it up. Yeah. Well,

I wouldn't say it's that easy. Uh, but certainly it's not easy. But we have incredible expertise that have been with a company of a very long time and added new talent as well, but strategically made a concerted effort over the last several years. So you know, we didn't have to react in real time because we were already moving strategically. But did you say when that happened, You're like, man, we're waiting ahead of the game, because we would have

had to do some shift. We we certainly felt confident in our strategy and in the plans that we had and executing bar none within the industry besting class, and I think that continues to be a strength of Mattel. And we're building upon strength. Yeah, Richard, what about when it comes to rising commodities costs? This is something that affects every company, whether you know, not just companies that you know our airlines or oil companies. But the price of of h W T I is up more than

thirty five pcent just this year. Tell uses a lot of plastic you have to ship stuff. Uh. How does that hit margins? Well? Look, uh, you know, cost factors have been you know, a real issue in our business and in every business for that matter. We've had a couple of years of significant inflation and we do this year is different. This year is to hate to tell you there's a lot of plastic and toys there are working on that too. We've got a lot of sustainability

efforts in place. UM. But it looked through a combination

of pricing UH and cost savings. We expect to exceed inflation over time UM and to higher prices or better manufacturing or lower There's not a silver bullet, right, So, I mean there there are pricing adjustments and strategies that will take place across our portfolio, and there's also cost savings as well that we've been also sharing and enjoying as part of our structural simplification plans, the two combined, if you will mitigate inflation to some degree and contribute

to the margin expansion that we have UH shared over time. UM. Granted, we've we've spent a lot of time talking about the impact of inflation and supply chain, but as you can see from our results and from the guidance that we've given, particularly in a quiet period right now, but from our two thousand on the side, again, as we take as we take strategic price increases and look for cost savings.

The most important part of our consumer proposition is to make sure our consumers really do love and get the value and innovation that our toys provide. But you're confident that the consumer can handle price increases, that the consumer is willing to pay, that you have that pricing power

at Mattel to raise those prices. I believe that our brands resonate with consumers around the world, and I think it's going to be UM the innovation and the brand reputation and the quality that ultimately consumers judge UH and and jury UH in the in the toy industry, and certainly our brands stand the test of time. I also

think there's a reflection back on nostalgic brands. We have brands that mom, dad grew up with and are enjoying that relationship with their Alright, So I brought I brought a little that I actually have had on my desk. It's probably from one of either ian On or somebody coming coming to visit. Um grew up with Barbie, loved it, loved it. We're talking with Richard Dixon, he's president and chief operating off a certain mantel here with Tim and myself. Um,

these are iconic brands. UM, and my kids played with him. Are my daughter, I should say my one kid? Um? And I certainly did. Where is the big growth? Because we talked about you guys, I've talked with the folks at w W E. I mean, you have these partnerships, these alliances. You have older collectibles n F T s. I assume play into the older collector of Mattel Brands, content creation, Barbie movie, Like, when is that happening? Where's the real growth going forward? And answer it all in

two minutes? Well, I think you have to stay, take a step back and look at our our strategic roadmap, which has really been to be an i P driven high performing toy companies, very Disney esque. Well, it's it's it's very Mattel. You know. We we have a portfolio of incredibly strong i P many of which as you mentioned, and there are a lot of brands within our portfolio that have you know, stood the test of time and could be revitalized. Masters of the Universe is a great

example of that. A huge property in the eighties, ran dormant for decades and we brought it back. No, I didn't play with might might have missed my generation, I don't know, But anyway, it's back and it's it's arguably better than ever. Um. But I think that the growth strategy of Mattel is really to continue to expand our i P into verticals, digital gaming content and f t s as you mentioned. But is it the adult collector that's the real like, where where's the growth come from?

It's both. It's it's literally across the board. If you look at our performance, every category that we're in and we're in seven categories, all grew. We grew market share across the world. Our biggest most important franchise brands are all in growth mode. Barbie Fisher price, Hot Wheels, American Girl, Thomas, the Tank Engine, our games portfolio, you know, single largest card game in the world. You know, we've done a

lot of work. We vital in our brands with the Mattel Playbook that we take a lot of pride and innovation, cultural relevance and executional excellence have been the forefront of making our business successful. When you're thinking about communicating to potential customers, the marketing of this, how big of a play is nostalgia? I mean, I think about my dad is probably more into Hot Wheels than my three year old at this point, but he's yeah, he's been in

a Hot Wheels his whole life. So are you trying to reach him? Are you trying to reach my three year old? I think, first of all, that's that's a great example of what we believe our growth strategy offers us as a multigenerational appeal. You know, we obviously have a core based business with kids three to eight and some younger, some older, but as the brand of sells Hot Wheels, Barbie and others have have have affinity and emotional connection. We have a collector audience that's growing rapidly

and becomes an incremental part of our toy business. So again, when you look at our three trajectories, growth in our core franchises with our core audience, and then incrementality with adults and collectors, that are going to be really exciting going forward. Probably movie production start this month. It started. We're in second week in production. It is unbelievable. We might want to, I might want to. I can't disclose

all the information, by the way counter discloses. Being on set was absolutely magical, and it's going to be a pop culture conversation man the actors. Richard Dixon, thank you so much. Thank you any time with both of you. Great to have you here. Richard Dixon, he's the president, chief operating officer at Mattel here in studio. This is Bloomberg Business Week with Carol mass Her and Bloomberg Quick

Takes Tim Stinovic on Bloomberg Radio. So Florida wants to be known for more than a place to have some fun in the sun. They're already attracting. We know the financial types. We talked about that a lot, and just recently we talked about the surging retail sale industry. Retail sales or the retail industry in in Palm Beach, and then of course there's crypto. Crypto uh huge when it comes to Miami, or at least that's what Miami Mayor

Francis Suarez is hoping to make it. He's trying to do what Finance was in New York and what Web two was in San Francisco and Silicon Valley happened for Web three in Miami. Mr lane A Golfa Pulu is personal finance reporter for Bloomberg new She's with us in the Bloomberg in Ractive Broker studio, but she spent some serious time in Miami talking to the mayor and talking to others, uh, including people who are behind crypto firms there, missy Uh. Can they pull it off? Can Miami pull

it off? Can Miami become the center of crypto in the US. That's the million dollar question? Um. You know, I think that as someone who lives in New York. When I first visited Miami a couple of weeks ago, I wanted to see what this hype is about. You know, everyone talks about crypto in Miami, but is it there? Can you feel it? And the truth is you definitely can. I mean you walk around the street and you see pain bitcoin signs everywhere. You're seeing restaurants, nightclubs starting to

accept it as a form of payment. You're seeing n F team murals pop up everywhere around the city. And it's sort of like sliding into real estate as well. So if you want to put you know, money down for a down payment for an apartment, you can do so with crypto in Miami. And so the hype is the regular people or is it the you know, wealthy people who can throw crypto around. I don't think it's the regular people. I do think it's the piece people.

I'm a regular person too. I think it's you know what I mean, Like definitely, I think it's the people that moved down there during COVID and have been able to sort of form a community that really sort of embrace this crypto. But it is permeating throughout different aspects of life in a way that you don't see it in any other city. But is this going to be long lasting? Right? Because this is sort of coming off

of the back of what happened during COVID. A lot of people moved down there, A lot of rich people moved down there. So investors are plentiful in Miami right now. But will this last for a long time? We don't know. Okay, this is Bloomberg. So we like the data. We have the numbers. You got the numbers from pitchbook. This chart in your story, this INTERACTI chart to encourage evility to

read this online because it is interactive. Uh, missy, San Francisco and New York just blow Miami out of the water when it comes to deal value, whether we're talking one or so far this year. Yeah, I mean Miami crypto Starbucks have startups excuse me, have attracted a sliver of the money that San Francisco and New York have have attracted. We have them here. This is for crypto to like. So this is of Victor crypto exactly, but I mean throughout like the whole industry, and the difference

is way bigger. So this is wait, this is okay, This is tracking money going into crypto startups in Miami, and that number is compared to San Francisco, New York exactly. In Miami, that number is eighty eight million. In San Francisco, it's twelve point seven billion. In New York it's seven billies. The numbers don't lie. The numbers don't lie. But look at the year of her year increase that Miami stawped as I do, not as I say, like, I mean,

this is like really what's happening right exactly? But again the year of her year increase that Miami saw between one, I mean, it's crazy. They went from six million into crypto startups startups to seven hundred million into crypto start ups within a year, right, And so you see the growth there. It's gonna take time to reach the levels that New York and San Francisco are in, but we're

seeing this crazy growth. So when we think about crypto, like I do wonder about like how you create a crypto infrastructure world, right, I mean, are there other cities that are making moves to actually kind of provide an environment where it's easy and fluid to kind of move within crypto? Definitely, I mean New York is one of them. We saw Mayor Eric Adams go and I'm not doing anything in crypto. Yeah, it's definitely not seeing it's definitely

not happening in the way it's happening in Miami. I'll put it that way. I think it that sort of organizational sort of um campaign that the mayor brought forth really attractive people, and we talked still getting paid in crypto? I don't think so. Um. You know. We spoke to the blockchain dot Com CEO who moved his office down to Miami, and he told us that he was actually negotiating with several states when COVID hit to decide where

he would move his headquarters to. And when I asked him, you know why Miami, he said that the vision the mayor had really just convinced him to do it because for a company like blockchain dot Com, think about how much easier it is to actually retain talent and attract talent in a city where crypto is something that everyone

is sort of on board with. So for him, he was like, I can hire people here that I may not necessarily be able to hire other cities, thinking about you could be part of that lab in this experiment exactly. And he had the mayor come and speak to you know, on site at his company, to all the workers there, and so that kind of interaction between city officials and people having like a vision down there is really prevalent

in Miami. You did also right though, Missy about the governor of Florida, and how that in his policies could prevent people from wanting to live there and relocating from New York or San Francisco. Perhaps, Yeah, it's it's hard to separate Miami from the state of Florida, which it's based, you know, and politics down there are very controversial for a lot of people. Well, what I will say is it doesn't seem to matter for all those people that decided to move down to Miami during COVID, And I

think that tells us something. I mean, Miami in and of itself, I think has to really separated itself from the rest of the state. And if all these people are willing to move down there because nothing was shut down and because they had freedoms to do whatever they wanted in their day to day life during COVID, you know, it doesn't necessarily point to the fact that this is going to be a problem, at least for now. But

the state has other issues as well, right. I think we also speak in the story about how it doesn't have top tier if I educational institutions like San Francisco and New York, and so I think that might be something that we should keep our eyes onto it's important. Mister Laney got a poolly personal finance reporter for Bloomberg News with us in the Bloomberg INTERACTI Broker Studio. Check

out her story on Bloomberg dot com. You're listening to Bloomberg business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio in the upcoming issue of the magazine, a story that also happens to be among her the most read on the Bloomberg Today and Tim, it's about how an ultra type job market as employers from law of healthcare dropping some of those tough job requirements. Yeah, these job requirements are known in the industry as quote

unquote credential lane. It's not something that I had thought a lot about before reading this story, and it's not us doctors and lawyers that require this type of credentialing. Jordan do is US economics reporter for Bloomberg Economics. J Jordan joins us on the phone from Washington, d C. Jordan's story is featured in the upcoming issue of Business Week magazine. Check it out at the Bloomberg Terminal and of course, at Bloomberg dot com. Slash business Week as well.

Joe Weber is editor at Bloomberg Business Week. He's with us in the Bloomberg Interactive Broker Studio Joel. Credential NG obviously coming to a head right now because of a tight labor market, but it would seem that changes, Uh, we're we're kind of happening before the pandemic to or sort of on their way to happen, because it's part of a broader conversation about access. Do you have credentials to ask me such a question? Um, that's a good question.

I'm unfortunately, unfortunately I'm overqualified. Yeah, that's that's a problem that on another day. And boy is that over sorry over credential not overqualified? That that that does kind of sum it all up though, right, And what the pandemic did was allow a lot of people to say, wait a second, maybe we can't we don't need all these prerequisite things that we've always required it And so some of some people basically that that kind of threshold came down.

And now the question is do you raise the threshold again or does it make you just rethink everything? And in Jordan, what did you learn in your reporting? Well, what I learned. What was interesting for me here is is so much of this conversation historically has been about workers well, I guess you could say are sort of on the lower end of the labor market, or who work in fields that are sort of lower stakes, that have less interaction with people, So care dressers, even florists,

um plumbers. These workers are all subjected to different types of licensing requirements, and for many years a lot of policymakers across the spectrum have called for a reevaluation of these requirements. But I think what we're seeing in more recent years, really brought on by the pandemic, is this debate kind of broadening to include more white collar advanced professions.

So we're seeing it in law, We're seeing it in healthcare and education where you have either job shortages or you have you know, COVID causing disruption and causing us

to question the status quo way of doing things. You know, COVID has has upended so many conventions when it comes to work, when it comes to schooling, And it's interesting now that we're two years out to see what might stick um where, you know, and in which cases we might kind of snap back to how things were done historically, or if people will use this as an opportunity to kind of re evaluate, um, not just that ninth to five office routine, but sort of the path to getting there. Jordan,

There's a stat that really jumped out at me. In the nineteen fifties, about one in twenty Americans needed a license to work in their field. Now it's about one in four. What's happened so over the decades, there's there's absolutely been an explosion in licensing, and it's really across all different types of fields. So, as I mentioned earlier, um, you know some types of jobs and occupations that you

might not imagine. Florists is a good example. And these are state by state licensing requirements, and that's what historically a lot of this debate has been about that if you live in one state and if you you know, relocate to another, which is what we saw a lot of during the pandemic, um that it causes a lot of red tape because you have to go through all of the steps again to get re licensed in the

new state for doing fairly similar work. You know, where the require you know, the the nature of the work doesn't really shift much from state to state UM. And so over the years we've seen more and more of this thing, which is which is overseen by seen by states and state licensing boards, UM, you know, more and more of it UM. But I think what's what's different now is that the pressure is not just on those types of jobs where people where you know, there's there's

greater consensus about do we really need licensing here? We're now seeing that in these um you know, in jobs where people are working in courtrooms and schools and hospitals, where there is a lot of concern about you know, your your people's health is on the line, people's you know, you're representing clients and court rooms that the arguments and support of licensing when it comes to protecting public health

and safety are probably most pronounced in these professions. And so it's interesting that we're that that it's expanding in those areas as well. It's also interesting there is when what you're describing on a state by state basis, it just seems like there's got to be a way of you know, being used to generate revenue, right, and so how much of that has entered the conversation licensing as a way to boost state revenues. Yeah, I think I

think that's a lot of the arguments, for sure. A lot of the you know, the pushback against some of these regimes is that it is sort of self serving. The sense that you know, you're you know, the woman we spoke with, calls of our exam for example, like a gate keeping measure, and there's a sense that these restrictions serves the members that you know, if you can restrict the number of people entering the field, you can, those people are going to get paid more because there

are fewer of them UM providing their services. UM. Similarly, for the associations and the boards who are dolling out these licensing UM, these licenses, it is, it is the source of revenue and so UM. I spoke with a professor at the University of Minnesota who's done a lot on licensing, Morris Kleiner. He wrote a piece in two thousand eighteen approximating two hundred billion dollars up to two hundred billion dollars annually and what he calls misallocated resources

I'm connected to excessive licensing. Well, I gotta say, I want my electrician that to be licensed, because I really do care. He was over dent. You know that this feels like to what's going on with college is right the application process, you know, with the test option, because I feel like it's such a huge industry, there's so much money involved, but you're increasingly seeing college a step away.

But there's also a component to your story, Um, Jordan, when it comes to racial exclusion because of excessive licensing. UM just got about thirty seconds what you found out on that? Sure, Well, the Minneapolis Federal Reserve just put out research last month showing that is the case that across education levels, we see this gap when it comes to licensing, UM, where white workers are disproportionately more licensed.

And you know, in a lot of these and a lot of different sectors, obtaining a license is very costly and very time consuming, and it can be cost prohibitive. So people who have more money to begin with are more likely to break through those hoops, UM, And so we're definitely the data definitely supports that. Well, it's certainly a sign of the times. Um. We're gonna leave it there.

I really appreciate it. Jordan jordanad He's US economics reporter at Bloomberg Economics, joining us on the phone from Washington, and of course, thanks to Joe Weber, editor Bloomberg Business Week. Here in our interacted broker studio, can we tell everybody why you're dressed up? We got some national magazine awards tonight, a couple nice Joel good Lass. Maybe we come in tomorrow with the trophy here, So okay, fingers crossed it that plays out? All right? Check out this story to

the upcoming issue of Bloomberg Business Week magazine. It will be out later this week online though already and on the Bloomberg terminal. You're listening to Bloomberg Radio. This is Bloomberg Business Week. You're listening to Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stenovic on Bloomberg Radio. Alright, everybody, just about ten minutes left in the trading session in lo and behold. Remember we had a pretty hot m and a uh year last year, and we're continuing to

see stuff happening. Just to rehash, we heard it from Charlie Spirit Airlines making an off for our getting an offer from Jet Blue, a takeover offer, and we're seeing shares of Spirit up about it is a three point six billion dollar offering again, this is from the New York Times. Yeah, that offers a roughly premium over the offer that Frontier had made in cash and shares to buy spirit uh Jeff Police shares by the way down of just about eight percent. Yeah, no, no surprise, they're

right as the potential acquirer. All right, let's get to it. It's a different market day. We heard Caroline Hyde, one of our TV colleagues, saying very different kind of from what we had yesterday. So let's see what our guest has to say about the current environment because we have stocks pretty much at their lows. A Newgagar is back with us, global investment strategist for Commonwealth Financial Network. She is once again with us on the phone in Waltham, Massachusetts. Hey,

a new Uh, nice to have you here. Had a bunch of FED speakers out there, esther George mary Dale or Lale brainerd uh, And they seem to be pretty aggressive, or at least some of them, when it comes to what we might get out of the balance sheet in terms of reductions on that specifically come at main meeting, and that has put pressure about the equity trade and certainly the fixed income treasury market. Trade. Um, how does that factor into your market projections if we start to

see more aggressive moves on the balance sheet? O, Carol, thank you so much for having me. Great to be back here today with you. So you are correct. The market is pricing in a more hawkish bed, which includes not just rate heights, but also a more aggressive balance sheet normalization process and likely most sanctions impol John Russia with the derivative impact belt in the commodity markets. So

and an inflation globally. And Um, what we're seeing with the Fed, the more hawkish Fed is we saw the youth of in voting earlier this week, last week, So the youth gold seems to be signaling of upcoming recession? And is it is it productive to keep having this recession talk? I can't. I feel like at this point we all know that at some point Republic can get a recession. It might be equivalent. I mean, come on, I no, you don't know. I completely agree with you.

I mean, look at the last recession that we predicted. It predicted it in but the only reason the recession happened was because of COVID, which was not something in right, So is it at this point? Is there a more constructive conversation to have then, are we are not going to have a recession? You made a great point, and we actually do need to take a more holistic perspective on the inversion, uh, and also separate the correct co

relation from the causation. So historically there is about an eighty percent probability that a Nields in version is followed by a recession, and that is a strong core relation and explains why the market is so volatile. But the inversion in and of itself does not cause a recession, and the not give a good sense of the timing for a recession. So what would cause that? So it's not the inversion right that causes the recession? What would

cause our recession? So uh to uh, you know, it says that we need to look at the other economic data points and they have what we're seeing right now. In the economy, it's still it's on a very strong footing. There are more job openings than people looking for employment. Wages are growing, convealers are spending, companies are growing learning, and most importantly, household and copper balance sheets are quite strong. So, yes, as you said, recessions risk, it might happen. It's an

economic cycle. It goes up and goes down. So the session risk has risen and we have likely paschment cycle and it's possibly heading into late cycles. But this part of the cycle could last for as little as six to seven months and as high as three years before we hit recessions, so we can technically be out of it, and then we'll get the reports of hey, for cause we were in a recession. Right, yeah, that's right. It

could be just a shallow recession. Yeah, okay, So how do you how does our investing audience play the next six or twelve months? Yea. So it is important to note that even when when the years goes it work, it's really a poor signal for getting out of this gases such as equity because late cycle is not the end, not the same as the end of cycle, and equities

can continue to offer positive return. In fact, in the last six episodes of yields goes in version since nineteen seventy five, global equities have an aggregate written in the twelve month period after that version. But of course, under the surface there are shifts and leadership and that's where

we need to focus. Well, So and that's a really good point, and I think maybe that is and I know certainly we do this with our TV colleagues and beyond the bell um in terms of constructive conversations about right sector rotation, market rotation, like we we can see that that will still provide some momentum for the equities, but it's not just an all in rally, that's right.

So UM returns generally have been weaker in the post in version period U when we start looking at how to go state defensive sectors have typically outperformed the C clicking sectors in the twelve months period after the two ten englosion. And they should make into it of sense because if we are nearing late cycles, equities are probably expensive,

Copper learnings have peaked. We are already looking at UM earning expectations for two one twenty two of about four points seven six cents, which is UM much lower than what we've seen in the last several quarters. And UM the feeder raising rates, so all of these factors can damfinitely return MUM also, you know, so basically would be what I'm saying is you have to be more defensively positioned. And also if you look at the US versus non US,

US equally inaggregate book more attractive than not US. All right, It's it's tricky, hey, and you always feel like we have a very thoughtful conversation with you. So thank you so much for for coming out. Tim and I were both jotting notes furiously, typing pretty frantically um our drive to the closer that new gagar is Global investment Strategist are coming with Financial Network. Thanks for listening to Bloomberg

Business Week. Download the podcast on iTunes, SoundCloud, or Bloomberg dot com, and you can also listen to our radio show at two pm Eastern on Bloomberg Radio or watch us on YouTube search Bloomberg Global News