Twitter, China, And Crypto (Podcast)

director there and a senior equity analyst and a bowl. Um, I guess Dan, for you, this must be the perfect time to go in and buy right. We had a big drop on Friday, big drop today? Um are, Is there is there ever point at which you're gonna say, you know what? This is over for now and let's make Tesla, Apple, Microsoft all neutrals until m until the crash is over. Yeah. Look, the fundamentals dictated change and shift in terms of cloud, cybersecurity, electric vehicles, spending, like

we've done in many names. Then you turn cautious. But it's like me and you have talked about for for years. We're in the first second inning of what I view is the fourth in Dushia revolution. So I don't throw in the towel because of a macro and rates going higher. I view it is just a painful digestion period, but not the end of what I view is tex stocks in the long term movement higher. Dan, Here's what I don't understand. You're seeing to have the sensitivity to rates,

have the sensitivity to simply risk off moves. The heavyweights lead the SMP five hundred to records, they also lead the sell off and you can see that um really in any of these red days that we see. But I'm curious if the likes of Apple, Microsoft, Tesla essentially boast this ability to have very strong supply chains that whether a lot of these issues that other companies are having, then where's the problem? Why are these stocks selling off

so much? Look, I think you're seeing everyone head for the elevator at the same time, risk off scary headlines, reads moving higher in Fleah, So you're seeing the risk off track all at the same time. And that's why I like text doctors over sohow relative to growth that

I've seen the last six years. And you can't paint a Netflix, a Zoom, a Facebook Slash Meta with the same brush as an Apple Microsoft, cybersecurity and cloud and it just speaks like that's why this is the most important earning season probably the last seventy years in terms of proving that the quote unquote massive slowdown off of a cliff is not happening across the board. That's sort of our thesis here in terms as we go through

what's really a key week for tech. By the way, you don't cover Twitter that I know of, at least I can't see a rating on Twitter. Um, what are you think about the possibility of Elon must coming in and purchasing this company. Look, we've taught it's a game of highest takes boker, And bottom line is the board was looking at the altar, waiting for a white night, a second bidder. They never came. Then Must details his financing.

It's not antics. At that point clock Stock twelve board had to go to negotiation table, and that's why it looks like a deal is going to happen, and it just looked as a public company for dociary. I mean, they ultimately thought that a second bidder would come, and I think in the streetside it's very skeptical at first, but now you know, really like a glad path to get the deal done. Dan, speaking of Twitter, and I know it's not your coverage universe, but stick with me here.

One of the questions around Twitter when Jack Dorsey wasn't charged was when he also created Square now known as Block I believe, and one of the concerns from a lot of investors was it would essentially split his attention. He can't give one enough of his leadership, and that's perhaps why he moved from Twitter to Square now known as Block. You do cover Tesla? Is that a risk when it comes to Tesla? I think it's to perceive the risk and and it is a real risk relative

to how it does. Must dive and deep end to the pool with Twitter in terms of Issy a chairman, because we we've that would be more of the role. It's not gonna be CEO, who have others that would ultimately as a private company, really try to transform Twitter. But I think it does take attention at a time that we're really going through just such an important time for Tessa in terms of easy the shift among consumers.

You have the Giga factory build out in Berlin, Austin, you have some of the issues clearly in China, which is the hearts and longs, the Tesla story. And that's why long perception you have to sell Pestler's shares is why the stock down look as a testa holder. Your dream is not for Musque to buy Twitter. It's a negative. And I think that's why you see that reaction because again the eyes of many you're trading in caviare for a pretzel on Broadway descriptive. Yeah, I'm hungry. I like it.

But if he stays chairman, I understand. And you know, we've obviously seen him do a couple of different jobs with much greater success, arguably greater than Jack Dorsey. Right, SpaceX and Twitter at the same time. Dan, great to have you on. Thanks so much for joining us. Dan ives. They are Managing director Senior equity analyst at Wedbush Security, Andy Marsh plug Power, speaking of CEO and president of plug Power. But it's not it doesn't do what you

think it does. Andy, I bet you a million people think that you, um, you're all about e V technology, but you're really about hydrogen and fuel cell technology. Right, tell us our outline for us the difference, Well, I think the mayor Hi match great being here. I think The major difference matter is, and I would separate is it's be these and be these run on batteries or as the Corvette as a hybrid unit with batteries and there were, and a fuel cell runs on hydrogen and

plug power. With our recent deal with walmart's going to be generating twenty tons of green hydrogen too for them, and a you know, a kilogram is a thousand tons as one ton, and that's about thirty three to one hours of electricity. So we generate hydrogen, we provide the fuel cells which make vehicles run like last mile vehicles

and Class eight trucks. Yeah, that's another important difference, right not um, you're not gonna be well, who knows what happens and when Corvette comes out fully electric, but for now you're not powering corvettes. You're powering what fork lifts or trucks that get things, not the eighteen wheelers, but the final destination trucks. Right With our JB with Renault, which is called i DA, we planned it over the next four or five years deploy over a hundred thousand

vehicles and they will run on duel cells. They will be powered by fuel cells and batteries will be hybridge, and that vehicle will be will be provided will be powered by green hydrogen, which is generated by plug power. We're building out five hundred tons of capacity here in the United States as well as in Europe with our partner Acciona, which is the largest provider of renewable electricity, which will be used to create green hydrogen. So you

mentioned your deal with Smart. I'm curious, who's coming next? Great question. You know, if you look at our chart of customers, it includes people like Amazon, Home Depot and others. I would expect that, like any company, we leverage our present relationships to build out our business with new products, and today I would think they're probably the prime candidates to who comes next? If you have Amazon in Walmart, I mean who else is there that's You've got the

whole market tied up? Why? Andy? Why you know the stock has been in one sense beloved a darling the company. I'll say, Um, I remember when Matt Winkler put you guys in an op ed about the importance of what you do. And on the on the other hand, um, it's been a tough run for the stock for shareholders over the last year. You've come down, you know over the from the high year down about half. Why do

you think or what's the market getting wrong? Well, I think that one item I think that's really critical matter is that we have a very strong balance sheet. We have over four billion dollars of cash in the bank to build our plan. We won't be going to the market. I think then you take on fat top of that that there's three advantages to hydrogen. One is that the world is committed to producing their CEO two footprint, and the folks of Bloomberg believes hydrogeneral of it. The second

item is that you know, we're creating jobs. I've been sitting here with Mackenzie today reviewing the job creation that plug Power and us in the hydrogen industry will will produce. It's going to be significant. And I think the third item is that hydrogen and fuel cells are critical to national security. We're substitute for natural gas. I think that

in the market, opportunities are large. You know, we can survive this short term dip in the stock price because the prospects long term are extremely positive and we have the balance sheet to support it. Balance sheet to support it. Talk to us a little bit about your cash, your debt. One of the big I think rescuers maybe for lack of a better term, when it comes to stock prices right now, is the amount of cushion, the amount of

liquidity a company has talked to us about yours. Yeah, at the moment, we have over four billion dollars of cash. I foresee no need in the mid term to have to be going to the market at all for cash. And when I talk mid term, I'm talking three to four years, all right, So very interesting set up there. Um. Is hydrogen power fuel cell gonna be used for electric

corvettes eventually? Does it go beyond I mean not the corvette specifically, but Andy, you get my meaning, to to go beyond the last mile vehicles that you currently power. Absolutely and I think you know, Plug spend a lot of time looking at Class eight vehicles and just to give you a feel, Walmart has about ten thousand Class eight vehicles. Moving to a hydrogen power Class eight vehicles. We reduced their carbon output by two three tons per

year per truck. That's a big number. Is to help them reach their goal of one giga ton per year reduction. So yes, we'll be there, Andy, Thanks so much. For joining US. Andy Marsh there is the CEO and president of Plug Power and UH as we have been discussing. They deal with hydrogen and fuel cell technology. They put, for example, UM the power into lift trucks for Walmart and for Amazon and for a number of other big companies.

So UM plug Power. The ticker is p L Eugene right now is trading at twenty one dollars and nineties cents on the NAZ deck. Now let's talk China. I mean, this is the driver between everything we've seen happen today in equity markets, the fallout in commodities with oil down five per cent UM, even the UH fixed income markets. I mean, on Friday we were talking about which economists could predict more rate rises from the Fed, right, I mean, no Mura said fifty basis points now and then seventy

seventy five. Everyone else was saying fifty. Um. It was like a contest. And now investors are clamoring to buy ten year debt. I mean, if you think the Fed's gonna raise rates that much, do you want to buy today's paper? Um? I guess you do if you are looking at what's coming out of only if you're freaked out about the possibility that she Jin Ping is gonna stick to his COVID zero Paul to see the economy be damned. Damien sass Hour joins us now from Bloomberg Intelligence.

Is that what we're looking at, Damien, Well, look, I mean it's very difficult to kind of think about where US treasury yields are going. I mean, I don't put any stock and where anyone is saying the dollar or treasuries are going to go from here. But look, I mean if you just look at where we are relative only a few months ago, I could not model a scenario in which you're going to get a positive toll to return out of US fixed income. I just couldn't

do it. But today, given where yields are, it's definitely a lot more plausible. And so look, if you're looking for safe havens in a world in which there are none, met um U s treasury is the long end of the curve is starting to look a little bit appealing. I'm very curious about the mobility data coming out of China. This is something that I think a lot of uh Chinese strategist or China strategists like yourself, um are are

looking at. But what I don't understand is that if you have this mobility data that is really just a function of COVID lockdowns, what is the read through into exports for China, because that seems to be the ripple effect for the rest of the world. Well, I mean that you're hitting right on the screws. I mean, I'm cretty. I mean, if you want to talk about export data, this is the real reason that you want has come off.

It's because of the move in the Japanese yen, right, I mean, we saw the Japanese yen has gotten absolutely crushed this month. And what that does is it makes Japanese exports that's that much more attractive relative to Asian peers like South Korea, like China, and certainly our friends in Beijing took stock of this. And look, I mean twenty three big figure move on a dollar u on just this month. I mean that is a very very

big move. And this is an economy where they have made it an absolute mandate to keep the volatility of dollar yuan to to a minimum. And look they're they're they're basically repricing it, They're basically rerating it. And look this is nothing new for China watchers, It's nothing new

for emergeny market investors. This happens once every what three or five years, and you know, on the back of it you see something like China high yield debt basically lose fifty percent of its value, which we have, or the equity market lose of its value year to date. Look,

you have to you have to weather that storm. This is just the way it is when you're investing in and A. But look, if you are looking at the technicals and I hate to look at technicals and and use that as a as as a sort of a written with which to invest, I mean, you look at margin lending, it's it's it's at a very low level. If you look at um, if you look at liquidity levels, you know, I mean they're they're they're they're starting to improve. So you know, you're starting to see you know, some

people kind of bottom feeding into Chinese equities. But for me, you know, the risk is just not there. I mean, despite the light investor positioning, I mean, there's just so much risk behind it. And given what's going on here with the A d R listings in the US and the fact that many of then me get you know, pushed out to Hong Kong. It's just not a recipe

for success of them. I mean I read in a Bloomberg story a couple of hours ago that in Shanghai workers in hasmat suits fanning out over the weekend to install steal fences around buildings with positive COVID cases. Well, what's the imagery to me is shocking. But my question is how does the PBOC react, you know, how does the um fiscal stimulus piece uh coming sort of balance

that on the teeter totter of COVID zero versus economic growth. Well, China has been very successful with the total social financing and injecting fiscal stimulus into the economy and doing it

in the right way. But you're absolutely right this economy, I mean, investors have been waiting waiting for Godot I guess, waiting for the PBOC to come in and start cutting rates and for me, you know, what they have not been able to achieve is, you know, to really get in front of the curve, to really show that the monetary support is sufficient to offset the GDP decline. So what are we calling for, as we were calling for

last year, We're calling for more triple our cuts. I think we're calling for something on the order of seventy five BIPs of cuts this year. We're also calling for another thirty BIPs of cuts to the medium to lending, the medium term lending facility. This is all good, but certainly it just doesn't look like it's going to be enough. And if you just look at the reserves in China three point one three point two trillion, it's they've got

tons of cushion there. One would think that they'd rather not dip into that in order to supplement the economy, that they'd rather you know, in age and monetary easing in order to do it. But look, the verdict is still at right now you've got China U S yield differentials in verted. You should not see that. It's something we rarely see. It's obviously being driven by US treasury yields on one hand, but rest assured you know the dollar you on cross rate follows that. Very few I

think that bounces back by the way I do. I absolutely do. I think if if it's right now, basically ideas you can get more buying US tenure treasuries than you can buying ten year debt in China, I think I think that China's hand is being forced here by the market. I think they're going to have to slash rates in order to protect their economy. I mean, look, you know it's a very different economy, right, and so

you know it remains to be seen. But if you just look at all the health care signs, you look at the entre offshore are China un basis where at three hundred bits, that's like a two and two and a half standard deviation move or something like that. If you look at one month delta risk reversals on dollar you on, I mean they are screaming of dollar call buying. You know, you've got Cinepeg, You've got PetroChina. You know their big energy exporters all uh purchase protection against the

rising dollars. So you know, the concern is there, and I think Beijing is finally getting the getting the hints hopefully, Damien. Thanks so much for joining us, Damian Sassaur. They're from Bloomberg Intelligence. By the way, dropping a pop culture reference. You can't do that with Critty. She's only what have you seen waiting for good? But to class she hasn't seen Armageddon and she hasn't seen waiting for good. Have confused? Confused? Know what you're from Texas? That has nothing to do

with it. You know what I've seen top gun and that's all that matters. Point, fair point, Damian, Thanks so much for joining us. We had so much to talk about with Shinali Bastik. I was thinking about you this weekend because well I read your story The Mooch, which I loved, and then the plot can saga continues unbelievable.

If you don't know Gabe plotting is the I guess he is considered like genius hedge fund manager who ran Melvin Capital and got destroyed by Wall Street bets and the kind of uh bro vests on Reddit, and now he came out with the He had the gall last week to come out and say, you know what, I'm gonna start charging my investors more. Yeah, is that right? Basically, so he was going to reboot his fund and now

he's going back to the drawing board. He apologized. He said he we hear the phrase reboot a lot, but all I was reading was two and twenty. Yeah. Yeah, I mean that's the thing. You can't just reboot by pretending everything else didn't happen in the past. That that is, if I had to draw this down to one line, it's that. And the reason I wanted to kind of draw these stories together is that actually Anthony Scaramucci's firm, Skybridge was an investor in Melvin Capital. So yeah, really

that's cool. So yeah, well that's the thing. These companies are very intertwined. And when it comes to Gay plot again, he's the next generation of fund managers, right, it's him, It's stand sometime, it's all of these younger stars that are hitting their first big sets of issues. And if you look at Gay Platkin, he got caught up last year in that Reddit saga in the short squeeze, then this year in the market draw downs, a lot of pain among him and his peers. By the way, I

take back the term bro investors. That was not fair. There are a lot of good bros in the world, and I don't mean to to to smear their good name with bets. Well here's the problem. But the mooch fits I mean, right, well, here's the thing. I mean, there's some bros involved, yes, of course, but however, a lot of these are you know, privy fund funds that are privy to big institutional investors that are very unbrolike

and in fact don't love the bro behavior. So it is definitely like this idea that you know, I'll even read from our story Sussex Partners selects hedge funds on behalf of clients big institutional investors. He they set told Bloomberg that resetting high watermarks at new higher levels, it ain't gonna cut it right, So you can't just start over here after after some batt It's not hard for me to believe that Scaramucci and Melvin are in bed together.

I was shocked that when I first heard, I think a couple of weeks ago, that Assault was going to go down to the Bahamas and hang out with my boy Sam Bankman Freed. These two people don't seem like peas in a pod, right, Anthony Scaramucci, who worked for Donald Trump for eleven days, he was too Trump to stay with the Trump administration. He's getting together the opposite.

Actually super genius with this incredible like m I T Havenford, Loss, Sand Bankman Freed and by the way, liberal Biden donor, they's hanging out with the Mouci Yeah, this is interesting. I think that that's you know, because Anthony Scaramucci had spent some time in the Trump White House. There's this

concept that he is, you know, trumpy, I guess. But the thing is, now, in addition to setting up this new conference, you know, we know Sam Bank from Freed is a huge Democratic donor and a huge donor to politics. We know that Anthony Scaramucci actually is part of a pack that's actually donating money or contributing money to both Democrats and Republicans. I guess they all they all pay

off politicians on both sides of the Aisland. The idea here that they have is to really contribute to especially Democratic politicians who are pro crypto. They think it's going to be a single issue vote into the midterms, into the next set of elections. So you know, yes, they have their pack that's on the side. But in addition to that, this week they were going to have a

thousand people. Now it's closer to two thousand people heading down to the Bahamas in order to talk about crypto, pump up the crypto industry and really get more people excited about crypto. As Skybridge. By the way, he told me Anthony told me that Skybridge has really been gaining from cryptocurrencies as some of these other hedge funds don't do as well. They bought bitcoin at they're better than fire? Are you going to fight? What not to fire that already?

Are you are not? Going? So my furious because I'm going to milk in next week and so that there's a lot of conferences going on. You've got to wonder how long this goes on for. Remember, people are still worried about COVID. I'm checking to see if I need to good test which people are still worried about COVID investors, anybody that's meeting up in large groups right now? A lot of people are. And by the way, have you guys tried to get an uber in New York? It's

like seventy bucks to get forty blocks. So it is, you know, hard to get around because people are meeting in mass and you know, next week it's time to do that little COVID check to see how many people went to these confermes. You're going to milk in. You pretty you just went to this oil conference that I loved you at. What was that did a month ago? Sara week Sarah week. What's your next conference? Uh? TVD the powers that you have not told me. I'll be.

But do we not have anyone going to the Bahamas? I don't know. So no, no, But you know, frankly, like, here's the thing, my this is, this is a Twitter People communicate of course through Twitter messages, and so my my Twitter message inbox is chock full of everyone who's in the Bahamas. So I do feel like I'm getting by. I'll go, I'll be not the Tan. You should go. You have a crypto show tomorrow? Yeah, and what when does this conference kick off tomorrow? Oh? So maybe I'll

just fly in after your show, my show. Um, if anybody out there is listening with a private jet and you're on your way feeling a little generous, is it? Are we? Are we going to hit a crypto winter here? I mean we're off what we were off another three percent this morning. Now, it's a great question. There's a lot of questions about at the Lunar Project and the buying of cryptocurrencies. There's a lot of questions around what is the next leg, you know, what's going to push

crypto actually higher. There was so much adoption last year people are really excited about the Lightning network. We're talking to Jack Maller's later today of strike. That's a big form. You know, if I told you that payments volumes surpassed Visa on the bitcoin network last year, you don't see it in the price today. And so I just you

just reminded me about. Um. What I loved about your interview with Scaramucci is he pointed out that he was in a meeting like forever ago in Washington, d C. With somebody from Treasury who was like, we should think about doing the digital dollar, and he was like how and they said, put it on the blockchain and he was like, oh oh, that a wake up call for him. And I thought that was just a brilliant little blurb from that from that story, So I recommend uh you

all always read Shnali's reporting. Do you have a newsletter I do every Friday? And how do we subscribe to that? You can subscribe on the terminal and you can also subscribe on my LinkedIn and you can just email me I'll put you on the letter. All right, Very cool, many many options, Very very cool. All right. Snollie Bassett covers Wall Street for US. Thanks for listening to the Bloomberg Markets podcast, you can subscribe and listen to interviews

of Apple Podcasts or whatever podcast platform you prefer. I'm Matt Miller. I'm on Twitter at Matt Miller three. Put on fall Sweeney. I'm on Twitter at pt Sweeney Before the podcast. You can always catch us worldwide at Bloomberg Radio