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This is Bloomberg Business Wait inside from the reporters and editors who bring you America's most trusted business magazine, plus gloom War, Business finance, and tech news. The Bloomberg Business Week Podcast with Carol Messer and Tim Stenebeck. From Bloomberg Radio.
And Video's impact on the epity trade today to the details behind and Video's earnings and outlook. That's where we want to go. As we noted, the superlatives continue the maker at the center of the artificial intelligence boom and Video shares topping one thousand dollars for the first time. We talked about the market cap a blowout quarter, So let's get to it. Back with us is Bloomberg News US Semiconductor and Networking reporter Ian King. He's in our
San Francisco bureau. Ian, you know the superlatives. We're watching the stock up above one thousand dollars for the first time, soaring in today's session. Walk us through all the number that showed Nvidia continues to deliver in your view.
I mean, obviously, the first place to start is with the revenue guidance analysts were looking for doubling year of a year in this current quarter. In Video said, yeah, we can do that, and we can do a bit more. So even though there were lofty expectations, they managed to set expectations even higher. The data center business is already bigger than Intel an AMD, and it's getting bigger quicker than people had projected more than four hundred percent a
year on year increase in that particular business. So all of the fundamental numbers that in Vidia need to show we're heading in the right direction, it was able to deliver on.
It's pretty again, incredible to see the stock reaction today. Shares hired by more than ten percent as we speak right now. Ian was I was a little struck, and Carol mentioned this by a couple of the things that they also announced the ten to one stock split coming next month, and then increasing the dividend. Curious if you have any thoughts on either of those things.
Well, I mean, you know, as you were just discussing with Bailey, I believe that the stock split is something that's aimed at retail investors, but it's also aimed at their internal audience as well. A certain percentage of the shares get bought by individuals. You know, they get like a discount slash, you know, allowance that they can buy at a certain point. So you know they want to want to keep their employees happily. Right, you need those engineers,
you need those that staff. That's that's you know, so invested in what you're doing. So that might be part of it as well.
Can I ask you though, because I did scratch my head a little bit about it.
I don't know.
I was going back and forth with a brother of mine who has been in an Nvidia for years, and we're going back and.
Got to get it your brother on.
The show, I don't know that.
Yeah, he's pretty smart, just really well read. But about the dividend, because I always feel like companies do that when maybe growth is slowing or something to kind of keep investors happy. Is there something, though, connected with that stock split that they raise the dividends so much?
I mean, for some in conductor companies which are massively capital intensive, even when they don't own their own manufacturing, that the question is how much are they spending as a percentage of their revenue on R and D, on design, on making sure that the next product's coming along? And you look, you know, Nvidia is one of the highest, one of the biggest spenders by any measure in the chip industry. So as long as they're doing that, I would say that most in Vidia watchers don't care. It's
just something nice to have. On the other side of.
Things, well, you talk about the R and D spend and it really, you know, certainly seems to be paying off for Nvidia. Having said that, talk to us about the development cycle, and I bring it up because I
was listening to Bloomberg Intelligence man Deep Seeing earlier. I think it was on surveillance this morning about how for Nvidia it's kind of a shorter time like almost every year, and that that is going to require companies who want to have the latest and greatest from Nvidia and in the AI chip world, that they're going to be adjusting
their CAPEX been to include that every year. So maybe you know, different from Moore's law, right that you know, the increase in terms of components on a circuit and processing ability doubling every year for ten years. So maybe something's different. I don't know. Is it is it shorter, is it a much more kind of you know, new development cycle for Nvidia that's going to keep these numbers growing. Sorry, I'm not being very eloquent because you're smarter less than I am.
Not at all. No, you're going to a good point here and within It has numerous aspects to it. Basically, what Jensen Lang, the CEO said, he said, Look, we were bringing new product market for this market roughly sort of every eighteen months or so. Now we're going to do it every year. We're going to do it every year for a number of reasons. He you know, put that the salesman routine. Look, we're helping our customers. This market is changing rapidly, so we need to bring soft
and market much much quicker than we were doing. To help support is to help bring these new capabilities. Everybody wins everything, you know, the pace of innovation increases. Flip side of that is, you remember earlier this year we were talking about what AMD's doing, what Intel's doing. You know, how are they going to get into the market. And what Jensen Wang has basically said to them is like that moving train that you are trying to catch is going even faster.
Good.
Look, So that's what's really going on on a competitive basis there as well.
And more's law I meant doubling every two years, So forgive me, yeah, so much faster here.
You know, Ian, I want to to that end of this of jumping on that train, I want to talk a little bit about margins, because the company said that margins for the gross margins will be seventy five point seven five percent in the current quarter. As you noted, this is more like a software company rather than a chip company. And you yesterday talked about Intel being in the low sixties at its height, when it really owned
the server market. What can history tell us about the duration and durability of margins like this for a chip company.
Yeah, I mean right now, their margins are what they want them to be because it's just really a case of, well, our prices a sky high, were sold out. We can essentially charge what we want, so obviously the pricing is very good for margins. On the flip side of that, as we just discussed, they can spend what they want. It's you know, how much do we want to spend on R and D, how well do we want to reward our employees. So the margins are sky high, but
they could make them artificially higher. The fact that they're spending heavily. The fact that they're able to charge a lot, that's something that's going to probably persist. So they're setting very high targets, but they could be even higher, So you know, as a measure of their health, it's pretty good.
Do you agree with Jensen's comment that the freight train is now moving faster and these companies will have a more difficult time, the AMDs and the like will have a more difficult time catching up with Nvidia.
I mean Jensen's racing. I mean that one of the things that comes across in pretty much any time he says something, he's constantly aware of the tension that exists in his business and his market, and he's consciously trying to shape post what his company does and his understanding of the relationships, where we are in the cycle, where we are relative to the competition, what the customers want.
He's trying to shape his narrative to fit that. He's very clever, and he's showing people that he understands what's going on and what he has to do to stay ahead, and that kind of institutional paranoia, that history of being the little guy still very much present in what he's doing.
All right, thirty seconds left here, So who is most likely to catch up to Nvidia? And when.
I mean for the talk to me this time next year, And there might be somebody, but right now it looks like everybody's just picking up the scraps.
Unbelievable and just a fascinating story. Ian, Thank you. I know it's been a busy twenty four hours for you,
so we really appreciate it. Ian King. Are Us Semikin, actor and networking reporter at Bloomberg News joining us from our San Francisco bureau as we mentioned, and VideA shares continuing to trade higher, still up about ten percent in today's session, and again you're now looking at a two point five almost two point six trillion dollar market cap company, so it is in the league of some of the largest market cap companies in the world.
So far this year, Carol, this was after yesterday's block yet last year's blockbuster year for the company in video shares are hired by one hundred and eleven percent.
Yeah, I think it's the third best performing group in the name in the S and P this year, after being number one last year.
You're listening to the Bloomberg Business Week podcast catch US Live weekday afternoons from two to five pm Eastern Listen on Apple card Play and then brought auto with a Bloomberg Business app, or watch US Live on YouTube.
Well for November presidential election in US, now less than six months away, there's a new variable to consider, and as far fetched as it may sound, the prospect of Donald Trump, should he find himself back in the Oval Office and then never leaving, is weighing big time on the minds of some voters.
The story featured in the forthcoming issue of BusinessWeek magazine, soon on newstands and now at on Bloomberg dot com and at Bloomberg dot com Slash BusinessWeek, also of course on the terminal with more on his story, Bloomberg businesswek national correspondent Josh Green. Josh the author of The Rebels Elizabeth Warren, Bernie Sanders, AOC and The Rise of the New Left. Also the author of the bestseller Devil's Bargain Steve Bennon, Donald Trump and the Storming of the Presidency.
Josh joins us from our Washington, DC bureau. Josh, what's going on here with the former president's rhetoric? What his advisors close to him? Are telling you, and the idea of taking him seriously but not literally kind of comes to mind when I read this.
Yeah, well, I've been talking to a Republican and Democratic strategist recently who'd mentioned that they were seeing something strange in the focus groups and polls they were conducting, and that is that a lot of swing voters were worried that Trump was going to declare himself president for life if he's reelected in November. And as I did some reporting on the source of these worries, basically this is
something that Trump likes to joke about. Of course, there was the January sixth riots that gave a lot of people pause. But it's a factor that I think isn't being paid a lot of attention to. But both Republican and Democratic strategists are seeing it and wondering if this is going to have an effect on the outcome in November.
You know, it's interesting and Josh, we don't certainly have to tell you, but this idea that former president Donald Trump will say something and people be like, well, that's Donald Trump, Like you know what I mean, They're kind of dismissive. Is there something though different? As he runs for a second go at the White House.
Yeah, I think there are a couple of things. I mean, as you mentioned, you know, the Trump people sort of laugh this office. This is just Trump being Trump. You know. He likes to say outrageous things to get a rise out of liberals. He's talked a little bit about will should I maybe serve three terms just this past weekend an our rally, for instance. But while a lot of people write off as just Trump being Trump, this particular group of voters seems to be listening to it and
worrying about it. And as strategists have kind of plumbed the reason for this, they've come up with some interesting theories, And the best one I heard was that it was really what was driving this fear was the Supreme Court's
decision to overturn Roe versus Wade. A Democratic strategist told me that what that did was convince a lot of ordinary voters that things they wouldn't have imagined possible, like Rovers's way being overturned or Trump abolishing term limit suddenly seemed real enough that these voters were worrying about it, and it seemed to be pushing at least some of them back into Joe Biden's camp.
Well, you get into the piece that the idea of president serving only two terms, whether consecutive or not, hasn't been in the Constitution since the days of the Founding Fathers by any means. It was ratified in the nineteen fifties after FDR served more than two terms. Can you talk a little bit about the history of presidents since nineteen fifty talking about the potential repealed the twenty second Amendment or at least alluding to the idea of serving more than two terms.
Yeah.
Absolutely, I mean, as I did a kind of a deep dive in this piece. What was interesting was almost immediately when the twenty second Amend, after the twenty second Amendment was passed, popular presidents and their advisors in both parties have kind of objected to it. Ronald Reagan said in nineteen eighty seven he would like to overturn it. Democrats in the House of Representatives twice, once during Bill Clinton's presidency once during Barack Obama's tried to push legislation
overturning it. So it's something that popular presidents sort of chafe at. But that being said, that the hurdle to actually get it overturned in abolished term limits is almost unthinkably difficult. It would require large majorities in both houses of Congress, that would require large majorities of state legislatures to approve it. So it's not something that's plausibly going to happen. And yet still people have learned that Trump
is a norm breaker. It's something that gives them pause and it's weighing on them as they make their decision on who to vote for in November.
Hey, Josh, there are focus groups, and then there are focus groups by those who have been doing them for some time that maybe you sit up a little bit straighter and take note, and is that kind of what's
going on? Because I am curious. I think it was the Democratic individual in your story from David Binder Research, who's been doing these focus groups for a long time, Like I just do wonder is there something that just makes everybody kind of be like, wait a minute, there's something different this time around, because you're like, as you said, it not the first president to maybe say yeah, I'd like another term.
Yeah, I think that's I think that's exactly what's going on. I mean, if you go back to twenty twenty and the January sixth, Uprising. It's sort of shaken a lot of people and made them realize that, well, maybe things aren't as smooth as we expect. The focus group guy that you were referring to has sort of said, you know, historically, when we conduct these focus groups and we throw out these kind of wild scenarios, val push back and say oh, that could never happen. But that kind of pushback now,
he says, has stopped in his focus groups. I was able to sit in on a couple of these and sort of see this myself, and people are just much more willing to believe that crazy things can happen, and that maybe one of those crazy things will be Trump declaring himself president for life. As implausible as that sounds, I think to most voters.
Well, it was struck by a woman who you spoke to who actually said that she would vote for Biden even if he is in a coma, despite the fact that back in twenty sixteen she voted for former President Trump during that election. Talk to me a little bit about her thinking, Josh, and how this could move the needle with the undecided voters.
Yeah, Well, the people I was focusing on in this piece really were that narrow group of undecided voters who are going to decide the election. A lot of committed Republicans like it when Trump talks about abolishing term moments. A lot of Democrats like to get upset about it, but their votes aren't really up for grabs on either side. So the focus of these focus groups and the voters that I talked to were people who had either been
former Trump voters former Biden voters, were now undecided. The woman you mentioned, Laura McCammon, is a grandmother in Wisconsin I talked to. Voted for Trump in twenty sixteen, but as she's witnessed January sixth, she's listened to, you know, maga media figures like Steve Bannon talk about multiple terms. It scared her into deciding that she wouldn't risk another vote for Donald Trump. And she told me, as you said, she's planning to vote for Biden in November no matter what.
Hey, you know, while we have you and one thing we wanted to ask you, and this was certainly a story that we've been talking about this week a lot, and this has to do with Donald Trump. A video posted to his social media account the report, Yeah, to his that referenced a unified Reich as a potential news headline if you won a second term. You know, Devil's Bargain bestseller, You know, you really got inside Steve Bannon and the road to the White House for Donald Trump
the first go round. How are you thinking about some of the terminology that's being used, the rhetoric that's being used by Donald Trump.
Well, this is something that we've seen going all the way back to Trump's first run in twenty fifteen and twenty sixteen, that kind of winking at the far right, either through phrases or memes or videos or what have you.
I don't know whether this was intentional or not, but you know, given Trump's background, given the praise he heaped on some of the Charlottesville protesters in twenty seventeen, another earlier controversy over anti Semitism, it's something that people in the press and people in the electro I think are
very alert. So something like this pops up in a Trump video, you see the media pouncing, you see the attention to it, and it's something that the Trump campaign, either intentionally or unintentionally, hasn't really managed to fix and bottle up. And kind of clean up their campaign. But I think we can see based on this it's something that we're going to have to keep an eye on going forward.
Right and certainly those undecided voters are keeping an eye on too. That maybe explains what you just talked about in your story. Hey Bloomberg, Bloomberg Business Week National correspondent Josh Green, Josh, thank you so much.
You're listening to the Bloomberg Business Week podcast. Listen live each weekday starting at two pm Eastern on applecar Play and and Royd Auto with the Bloomberg Business App. You can also listen live on Amazon Alexa from our flagship New York station, Just say Alexa Play Bloomberg eleven thirty.
Well, this graduation seasons over the next few weeks are months hopefully young people will be going off to their first post college jobs. Bloomberg opinion columnist Alison Schreeger covers economics, and she writes in one of the most read stories on the Bloomberg terminal about an interesting trend that she's noticed, at least according to one recent survey, and that's that more graduates are looking to job in the public sector.
They are Alison Schrager a Senior Fellow at the Manhattan Institute in addition to being a Bloomberg Opinion columnist. She jes us here in our Bloomberg Interactive broker's studio. So an important caveat. Some of your best friends work in the government.
Actually I don't have a lot of friends in government, but you wrote in the piece. Yeah, but you know, there's no shame. I mean, it's a reasonable, it's a respectable career path.
It is.
We all know people who work in the government. All right, tell us what's going on. I have a twenty one year old just get one more year in college, but I will say that working in the government is certainly on her radar.
Really, yes, well, because I was surprised because the survey, you know, did a lot of sort of hype about, ooh, government is up and tech is down. And then you saw the numbers and it was like up from five and a half to seven and a half percent and tech is down from twenty three to twenty one. So you're like, all right, well, mean, people still prefer tech.
But what really concerned me was that there was another like the listing of what you're looking for in a job, and the number one thing by far overwhelming was stability, and last was a fast growing company, which is just like when you're young. I mean, like if you get on a fast grown company path, like this is how you get like rich and successful.
Well, we love how you start the story, like in a week where we have been obsessed with Nvidia and still are that. Everybody's looking for their Nvidia, right, you want to be with that company that's going to be the hot new thing. Hopefully get in early, get options, and make a lot of money, like that's it.
Yeah, but no, they want stability.
I will I will say for my daughter, I don't know that that's it. She's gonna hate me that I'm talking about her.
She's not even a senior.
No, but they start early and there's a lot of pressure, but on way to doing something, probably in the private sector and possibly in the investment world. But that experience is certainly looked at highly.
I can be. I guess it depends on what you do.
I mean, I think what struck me about it is it's like.
There's been a downward trend of working in the government.
So of course, but we've had a lot of new policies in the last couple of years that aim to grow the government and grown many Facturing was also a big growth area in terms of job interest, So I mean these are policy priorities, So maybe it reflects that.
What does it tell you about the idea of stability in the way that some graduates might be looking for more stability rather than that path to being the next next Jets and Wong, Well.
I mean there is all this evidence, like Genie Twang's Generations that has all this evidence that young people are more risk averse, So I guess, I mean, I think that that would be the concern is that they're going to be less dynamic and less risk takers, which you know means less growth for the future, which you know, we need them to pay for all of our retirements.
So that's not good.
I've already worn my daughter.
But so I said, it could reflect that that like, hey, you know, I don't want to be at that fast grown company. I just want the stability, and that might reflect more risk a version. Also, I mean, this is a generation, this is a very tumultuous last couple of years, so I mean maybe the stability is just very appealing after you know, having their end of high school and honestly almost their entire college career.
Being credibly charel, I.
Will say, there's also this revolving door between the government and the private sector, and yes, it's pretty incredible to see, and especially with politicians in the House and Senate. Like ex politicians go from making what I think close to two hundred thousand dollars a year maybe as a member of the House, to like eight hundred thousand dollars a year being a consultant for some of the companies or
industries that they used to actually legislate. And I wonder if there's any sort of visibility there.
Well, you know, it's kind of weird to say, but I hope that's it. At least there's some ambition, because I think when I think of most people aspiring to work at government, especially where most of the government jobs are, it's like at the state and local level, Yeah, which is you know, more like parks and recreation. Yeah, so you know they're working for the SEC.
Which could be fun.
Yeah, just kidding, Yeah, it totally could.
Again, someone needs to make the world work. And when I posted the column on Twitter, so many people wrote and they're.
Like, excellent, it's great.
People of such a great sense of service, which I've then felt bad.
That's not what occurred to me.
That's that's interesting. Why do you think that didn't occur to you?
Because I've never worked in the government, actually not the US government, But I mean I always thought of it as being sort of like boring and stay safe, and I always want to like do something, you know, a little bit. But I mean that might be my bias. Maybe I also don't have a good sense of service.
I don't know that that is super interesting. And I do think that maybe there are like we've gone through some generations where it's like big government, what do they do?
It's those people there.
Forever and you know, you have to dust them off kind of thing. Forgive me not my view what people say, but I do like I am encouraged when I hear a younger individuals say I want to be part of government, like I want to help. I want to help, you know, create policy. I want to do that. And so I think that's kind of interesting.
You see, like a lot of these jobs are like the stay and local level. They're not glamorous, but they really are important and you know, we all need them to make the world go.
Round exactly one line I love in your column. What explains this shift? Perhaps they just feel grateful to be working because like this idea, and I've heard this from you know, very graduates, like it's tough the job market out there, which is amazing because we talk about it being tight and that there are jobs out there, but that many are finding it tricky.
I think I want to come about this a couple of weeks, or maybe it was last week that you know.
I think we often confuse.
Forget about the fact that we talk about generational strife. Yea that like your first job, getting that first job and getting that good first job and getting a foothold in your career is always hard, and it's hard for every generation.
It was hard for us.
Took me a year and a half to finally get something and not settle, to be quite honest.
Yeah, and we get into these generational ships. But I think it just doesn't change. It's just it's hard to become an adult and it's hard to make that transition into the like having a career and feeling stable in your career.
And it's never going to be easy for anyone because we don't want to be adults, Tip and I we're talking about.
This generation does though apparently like they're not looking to be like poets somewhere, they want the government job.
Yeah, at the end of the day, it's just one survey. Do we have to think about that a lot?
Well, you know, I would, that's you know, and it's a small survey. It's only like twenty three hundred people. I think the reason why I felt like it was worth writing about though, is it does seem in line with other surveys I've seen that put such a high premium on stability.
Yeah, such an aversion to risk.
So it's consistent with that, because yeah, normally you wouldn't be like, okay, five survey of twenty five hundred people like two percent more when working government, big deal. But
I do it does seem consistent with other things. And I was struck by they had an interesting chart where they did the correlation of where job opportunities are and it was a very sort of perfect correlation with you know, people feeling like disenchanted with finance and tech and more with government and manufacturing.
I will say that, you know, having covered a lot of different business cycles, that I do feel like companies are very very quick that if there's some pressure something, they'll cut jobs, they'll cut costs because that's what certainly they're publicly held, that's what Wall Street and investors want. So you know that can be pretty uncomfortable to be around.
Yeah, although we do think of government is more stable. But I mean, especially if you're working at the state and local level, I mean a stall finances, you're not good that actually you might be better.
Off in the video or maybe if you're in a part of a cabinet thousand.
Sorry sorry to throw water on your safety.
The presidential administration.
You never know what's going to happen, remember, really really fun column.
Something to think about though, And like I said, just talking with my daughter and some of her friends, like it's interesting that they are looking at this and kind of in it. They'll be grad school fortunately, Oh discuss Allison Schrager, Senior Fellow at the Manhattan Institute and Bloomberg Opinion Columns. Check out more.
I'd be go mac journal.
How about you let me drive?
No, no, no, no, who's going alright?
Please?
I'll gravelt.
I want to try.
It's a good question.
This is the drive to the clothes ung for me think. Well, on Bloomberg Radio.
All right, everybody, we're driving to the clothes. We're talking with Bill Maloney.
Because because he's a legend.
It's yeah, he's a legend, and it's also just kind of an interesting market and it's just you know, here, you think, and Vidi's going to come out of the gate, and it is doing. It is rallying in a big way, no doubt about it. But you're not seeing it translate across And even though we did see some enthusiasm out of the gate earlier, we were just talking about the
hot manufacturing data. We talked about that with Stuart Paul earlier, and it just is enough to push up yields hired and it makes everybody kind of rethink, all right, you know, where's our environment right now? Hen tick, he says, he's like just focusing.
SQUA on the Bloomberg terminal s qua. Yeah, that's how you get to audio squak and you can hear Bill Maloney all day.
Worth listening to, all right. Also worth listening to is Lauren san Felipo. She's senior investment strategist from Maryland Bank of America's private bank. Joins US Bank of America Private Bank, I should say she is joining us from New York City, Lauren, Good to have you here with us. I'm always interested because you guys have wealthy clients, those who deal with you in the private bank. What do they want to know about this environment?
Well, for sure, they want to be opportunistic here up ahead of the election. They're watching a market that just seems to be straight up into the right. And you know, I'd say what we're telling them on a sector level at least, is to buy energy here. We think it's a great place to put money to work. We're looking at some good balance sheets for energy valuation still attractive. You know, there's still that energy transition that's in front
of us. So you know, we try to be opportunistic with our clients.
Why is energy attractive?
Few?
So, as I said, they have those Fortress balance sheets. You know, I think another way to think about it though, some of these long arc stories, and I think this market likes narratives. We think about hard assets, hard power, and hard hats. We like hard assets that commodities tilts just as an inflation head, geopolitical risk kedge, hard power. We think about the fact that security the world we're living in, right, cybersecurity that's also included under hard power
and then hard hats. We have these massive legislative packages out there are they're being awarded now to companies, and you know, the spending stickets are clearly open.
So narratives I like it, And you said kind of like hard assets. It sounds like, what's interesting is AI in a day when we're focused on Nvidia, which is doing very well compared to the rest of the market, soaring in today's session, what's the AI narrative and AI investment play that you think makes the most sense? Is it the hard asset play if you will, like the power centers needed to power the data centers. Pull that line through for us, if you.
Would, Carol, Yeah, I agree. This is sort of a both story in the sense it's software and hardware. So AI. We still believe AI has a place in moor folios core holdings, right. I don't know if you buy it at this level today. Valuations have obviously run up, but you know, I think AI's impacts will be measured in years. It's not like a quarter to quarter type play. We're seeing though. Some real profitability comes through though on this
whole early innings of this AI revolution. So it's a hardware and software play for sure, and data center is certainly part of that story. Power electricity, GPUs, the whole, the whole sort of ecosystem.
Which part of the ecosystem are you most bullish on.
Right now? I mean utilities. It's it's kind of like the underdog story, right I mean, I think it's the tertiary sort of the fact that utilities are defensive. So he sort of saw utilities work really well last month April when we had that pullback in the market overall, But it's that power producer. It's the setup is right there. I mean, we need more electricity devoted to those GPUs,
the data centers. Then you start thinking about cooling equipment, and you know, there's just a lot of tentacles to the story.
Interesting, and I'm looking at utility is it's your third best major industry group out of eleven in the S and P five hundred for the year, up about eleven percent. Above it though infotech, which is up seventeen percent, communication services up almost twenty percent here, So investors, we know kind of what's been some of the trends here. I don't know, how do you look at this market more broadly in terms of I don't know, does it need a breather? Are you thinking about rates on a regular
basis and the implications of that. It just kind of feels like day to day a bit manic in terms of what we think might happen next manic.
It's probably a good way to put it, I'd say, though. There are plenty of reasons though, to still be positive on the market without getting tumnic about it. I mean, consumers are still spending, right, Businesses are still investing. There's a lot of capex. I mean, I think that's one great underlying thing we learned from earning season this quarter. Right, Businesses are certainly so investing, capics putting up big numbers
buy backs. I mean we even Atlanta fed GDP at an estimate of three point six percent, so and we're more than halfway through, right, I mean, we're closing in here on then to met here. So a lot to still be positive. I mean, try not to be too manic about it, but there's a lot out there we pullish on.
What out there concerns you though, Yeah.
So inflation sticky, I mean isn't that the obvious answer. It's going to be the predominant focus now for once we close in on the end of earning season, and then the focus for markets really will shift back to that macro data, So inflation for sure. You know, I think another risk, volatility is basically absent. I think volatility is already already on vacation right now. The VIX is super subdued. But you know, geopolitical flare ups, let's not
completely rule it out right. I mean, I know we temporarily see some price wings following some of those layer ups. We've seen that a lot this year. But you know, I think there's always that sneaky potential for geopolitics to matter.
Hey, Lauren, earlier we were talking about a story that's among the most read and about kind of private credits problem that they've got a lot of money to work, to put to work, and so they're have to do some interesting deals maybe you know, take down the rates in terms of when banks need to when companies need to do a deal with them, they're getting lower rates, which you know, obviously you think about in terms of returns for investors. Having said that, you are part of
the b of a private bank. How many of your clients are accessing private credit, are interested in doing private credit? That the private medit markets are what they're really interested in today.
A lot of focus actually has been devoted to this private credit sleeve, I'll say, And you know, it speaks a lot to clients here about this liquidity environment, right, and so immediately that's sort of like the intriguing factor. So private credit. Yeah, we are gonna have to do more in this space sort of through your end. And we're up against an election, so that's another consideration.
But I mean your private bank clients increasingly, you guys putting investments for them into private credit.
Yes, And I think that's an industry change sort of this year, right. I do think that we're sort of adding towards that. Yeah, this is the year.
All right, Gonna leave it there, Hey, Lauren, thank you so much. Lauren san Felipe. She's senior investment strategist for Merrill and Bank, a private a Bank of America private bank joining us here in New York City.
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