Advisors' Colyer: Tremendous Amount of Value in Nikkei (Audio)

one percent down. Industrials up nine a gain of point one percent. Naz stack up three points, a gain of point one percent. Ten yere yield one point eight four percent. Gold down to forty bence to twelve fifteen, a drop of two tenths of one percent. Crude oil up eleven cents one for a barrel of West Texas Intermediate crude. Again there of two tenths of one percent. I'm Charlie Pellett. That's a Bloomberg Business Flash, pelle It. Thank you so very much. It's time now for the e t F Report,

brought to you by Van Eck Vectors. E t F S expect more from your muni's target taxes and income by maturity and credit quality, all with lows cost e t f s. Visit vanek dot com slash Muni Vanek access the opportunities. For our e t F report, we turn to our own Catherine Cowtery. Crude oil has wrapped up its longest run of monthly games in five years, advancing for four straight months. Oil has surged more than eighty five percent since touching a twelve year low in February.

Yet investors in oil ets haven't seen the same returns. Here's Bloomberg Intelligence sandialist Eric beltunis, We've been talking for the last two years about all the flows that have gone into oil ETFs. For the past years, it added up. It's about twenty six billion dollars of people trying to call a bottom and oil well, obviously oil is rebounding this year. You know, the lottery ticket has come in. But unfortunately a lot of the e t f s that were being used to try to play the rebound

in oil have lagged. Spot Boltunist uses the United States Oil Fund e t F for USO as an example. It's up nine percent so far this here less than half they gain a spot oil. The reason is because US it doesn't track spot oil or a barrel oil tracts futures and you have to maintain a position, and there's role costs. We get into the weeds here, but it's a complicated situation and those roll costs corroded over time.

And that's your Bloomberg ETF report. I'm Katherine Cowdery. You're listening to Taking Stock with Kathleen Hayes and Pim Fox on Bloomberg Radio. Kind of mixed day if you look at the economy and the big reports out today. Auto sales looking not so hot if you're a big three auto maker, but US manufacturing looking like maybe it's not doing so badly in May after he got the I s MS Manufacturing survey. So where are are the markets going? And where should we all be putting our money? That's

we're gonna ask our next guests. Scott Colier. He is chief Executive Officer, CEO, Chief Investment Officer and c i O an advisor's asset management more than sixteen billion dollars of assets under management, usually in Colorado Springs, Colorado, but he is here in our New York studio today, home of Bloomberg eleven. So welcome, Thank you. So what is

your sense right now, Scott of the stock market. A lot of people are worried about valuations stretched, earnings have been weak, and they don't look like they're gonna get a lot stronger at time when sure you can buy stocks, but you have to buy them individually and very carefully. What's your view. I think my view would be more traditionally that the more people worried, the better I probably liked the market. I tend to be a little bit on the value side of things. Maybe I think consensus

might be a bit uh a bit off here. If you look, I think at thirty thousand foot view, the environment is very good for earnings to grow in the future. We had a bit of a dollar headwind last year. We don't have that this year. Actually, I think that becomes a little bit of a tailwind. I think the consumer, if you look at them, they may have not bought as many cars in April, but they're still buying cars at close to a record rate. Housing market looks to

be picking up, consumer credit is growing. I think we have a very healthy consumer. They're about us GDP. I'm very comfortable, probably where the markets are. And I think that that so many people are worried, it makes me actually feel better about it. Is the FED on your radar screen or would you just say, Hey, they can even raise rates two more times this year, doesn't make any difference. Well, I wish they the FED was more

on my my radar screen than they are. I think if they were threatening to to raise rates for times a year, that would be better for us. That would mean that we would have actually upward pressure on earnings, we would have upward pressure on wages, and it would give them a reason to worry about slowing us down. Right now, they're still worried about speeding us up. So we're just kind of trudging along. And I think the FED is going to I don't think they're gonna do

anything to upset the apple cart. Maybe one raise this year, but quite frankly bases points. I don't think anybody cares. Now. You said you look for value and one of the sectors that you are in favor of right now is energy. Is that because you say it's so beaten up and the bottom is in now is it time to buy? Well, it's not a timing call so much as what we've done is we've destroyed all the investment to find more of the stuff that we're depleting on a daily basis.

So what we're not doing is we've we've laid all of our rigs down. We're not looking for anymore. So quite frankly, if you have any growth in demand, which we're actually seeing growth in global demand, we're not finding anymore. We're actually sowing the seeds for the for the next upward push in oil prices. Do I think the bottom was put in? I tend to think it's put in,

not because we hit twenty six dollars. I'm not an expert in the oil industry, but what I do see or term structures that are going from a sharp contango which you're you're bidding for storage, to more of a well supplied market, but a more balanced market. So uh, I think the concern even that OPEC meeting is going to have tomorrow. They're not meeting because they don't know each other and they want to get to know each other. They're meeting because they're all concerned that they want to

support higher prices. You like industrials and manufacturing, Why I do, because they do well when we have economic growth, and I think the the environment in the United States as well as Europe and in Asia is very friendly to economic growth at this point in time. Financials banks, big banks, medium sized banks, regionals what well. I think regionals are

better than big banks. Big banks are quite frankly, quite overregulated, and they you know, they don't have really the earnings power they used to their more of a financial utility. So if you're talking about financials in the United States, I would pick the regionals over over the large banks. Precious metals gold different precious metal silver. Thus are they They've actually done quite well after a very long bear market,

so maybe four or five years. They Commodities really have been the worst performer if you look at the the chart of best performing parts of the market, and worst performing commodities have been on the absolute bottom for the last four years. Commodities do well when we see growth, When you see growth and demand, they tend to do well.

Gold and silver may have a different they may they're almost treated as a different class than than commodities, even though I would argue they've all pretty much bottomed together. Gold is is also a currency, and it's a currency that's universal and when we see central banks buying them in huge amounts like we do now, everybody's trying to

weaken their own currency. What do you think I think gold might not be a bad place to go alright, Scott call, of course, as I said, you're CEO and Advisor's asset management, You're based in Colorado Springs, and you have a very global outlook. You have a global overallocation. China, Japan, Europe, emerging markets. Let's start with Japan. I'm really focused on them today. You know, the Prime Minister decided he you know, he put up a lot of red flags. And yes,

they're not going to raise their consumption tax. They've done that in the past a couple of times and pushed their economy into recessions. But you like Japan. Why Japan is is a great amount of value. But they've been a great amount of value for quite some time, very cash rich companies that trade in in Tokyo, and they trade it at very low multiple. So to the extent that abeonomics could produce any type of growth whatsoever, we think there's a tremendous amount of value in the knee King.

And do you think that's gonna happen. Is it gonna produce ground? Well, I do believe that they will keep trying until they get it. One of the you know, if you're talking about delaying the consumption tax by two years, that is only one step that they've they've taken. Obviously they are they were kind of the first to go into the negative interest rate area after after the ECB tried it. I'm not really sure that that's going to

produce growth. But once again, if you're a business person globally, there has never been a more easy um environment for you to try to grow business. Okay, let's hit on a couple more of these real quick. Here. You like China and how would you invest there? How do you invest there? Well, I'm not I'm not quite uh brave enough to to wade into the red chips, so we would stay in the hangs saying that, you know, this is the Hong Kong market. These are the shares that

are are legally tradeable outside of outside of China. They tend to be the biggest of the blue chips, and I think I would stay uh in that area if I were going to try to trade China. Okay, let's see your emerging market picks. You've got Latin America, Russia, and India, Latin America broadly Mexico. Yeah, so well, Mexico is a is a good example. But you always you tend to buy Latin America and emerging markets when they

look the worst. But I would tell you that there is something going on in in in Latin America where we're having a change in governments. We've had a change in the Argentine government. We're now having a change in the Brazilian in government. The president has been impeached and she is now out for six months trying to defend herself. But also in Bolivia, they refuse to UH to rewrite their constitution to allow for a third UH term of presidency.

And you're also seeing what you know, Venezuela follow apart right in front of us. So I would suggest to you that the new governments are more pro business. This is the time you tend to want to buy those markets. We expect an upturning global growth and I think they benefit from that. Ten or fifteen seconds, do you like Russia, well, liking Russia or not liking Russia. I think Russia, Russia's economy is very much tied to commodity. So if I like the commodity story, I tend to like the future

of Russia. There's more political risk there, but I would suggest to you that you're probably being paid well to take the risk you like investing in rusting. I thank you so much. Scott called. Great to have you on the show today. Thank you. CEO Advisor's Asset Management. Colorado Springs is his bass season our New York studio today. I'm Kathleen Hayes. This is taking Stock on Bloomberg Radio. Yeah,