SURVpodcast_12-01-22_1

Michael Wilson, chief US equity strategist at Morgan Stanley, was out front with a cute week to week talk about a bear market, and then up in June, down again, and now up again. An important conversation, John, why don't you lead off with Mr Wilson? I think we could have got to mix Chrystal Bull Mike. I think the code of the year wasn't the code of the start

of the year. It was that tactical rally, that buddish cool you made about a month or sub ago, and Mike were seen it play out, and I think we're all wondering whether you said it's much more upside from here. Well, thanks John, good to see you guys, And look, I I mean we talked about this the last time. I was on the tactical rally. I felt like the move to four thousand was was pretty much in the cards, and then we said, look, we don't know if we're

gonna get another level to this. If it's going to happen, we're gonna need rates to come in further. Uh. And that's what That's what's happening now, and it's gonna be probably led by you know, the NASDAC and also the you know stocks that are most heavily shorted as rates come down along duration plays and that's exactly what we saw yesterday. And so we have more confidence that this rally will continue into December. It's not gonna be easy because I want to make it clear, as we said

last time as well, it's still a bear market. Um, these things are tricky, but we have to try and trade these. When you get moves to go against you, you don't want to miss it. And sometimes we get it right. Sometimes we know this one we did. So we're we think it can extend here. Now, we think rates will go lower. We think you know, Polle's commentaries right in line with what we've been saying, which is

that they're going to pause probably in January. And the market is getting in front of that, and this is a this is a classic uh you know, kind of uh kind of bed pause stock market rally and then ultimately you think we get beaten around the head with Paul earnings as we got into three. Now, Mike, I'm going to read you a quote and it reads as follows. Previous slows and equity markets are likely to be retested as there may be a significant decline in corporate earnings.

We're inclined to think that this market decline could happen between now and the end of the first quarter of three. Now, if someone gave me that quote, Mike, I can't think it was you, except it wasn't. It was JP Morgan's Marko Kolanovich yesterday. Now, Mike, you like to be contrarian, you have been through much of this year. I have to say that view now of early twenty three earnings risk is almost consensus. Mike, How are you thinking about

it as we go into a new year. Yeah, I mean, like you know, you can say for other people too. Were all trying to, you know, stand out with something that's you know, insafeful or different, and you're right, I mean, our our call this year now has become pretty much concerned it's this that. But that's why we flipped in in October quite frankly, as we felt like that call, the fire and ice call right fed tightening into a

slowdown became consensus. Now we see kind of this idea that we're gonna make a lower low in the first quarter. I don't think that's quite consensus yet. But I tell you what's not consensus is this taxble rally, Okay, that we watched that you know, our competitors, we watch touch a lot of clients to try and get a sense for where that sentiment is. And I would say this is one of the most hated bear market rallies that

I can recall, even more so than this summer. So I think the right set up now is this rally will go further and we'll probably drag people back into thinking that the bear market is over, and then that will be part of the signal for us to kind of press on the other side again. Pushing again, staid perhaps Mike, and this goes to Allen Setner and maybe jobs day tomorrow is what inflation does, what the economy does?

What are your analysts and Morgan Stanley say about the mystery of revenue growth at the top line next year, and if you get better revenue growth because of high nominal GDP, how does that redound upon margins. Yeah, this has been an ongoing debate we've had with clients since really April. Uh, you know, we were out in front on earnings disappointing at some point into twenty three. And but it does contrast with this idea that we have

in a nominal world. Uh, you know GDP. Nomenal GDP is probably gonna stay positive next year, even if we have a recession. You know, Ellen's forecast next year is for not a recession, but basically zero percent real growth, So it's gonna feel like a recession. What's your point if you get you know, if inflation is still positive,

you can have positive revenue growth. We have that baked into our numbers time when in other words, our base case a D nine dollars next year assumes if we still have positive revenue growth about three percent due to you nominal GDP staying in positive territory. But it all

comes down to margins. And this is the part of the story that we think is underappreciated by a lot of investors, which is, you know, inflation is what drove profits higher, and so as inflation comes down next year, as we're forecasting we have inflation going back towards to two two three by the end of the next year. That's actually bad for equities, good for bonds, but bad

for equities because it's going to crush margins. And this is the story that we think is once again under appreciate the negative operating leverage that we're seeing in business models as companies scrambled for supply six eight months ago and over higher. That has to be you know, run through the income statement now and that's gonna be the that's gonna what that's gonna be what makes the low

in the first and second quarter. So I would say where people are maybe catching up on the earning story, I don't think they're bearish enough in terms of this

margin degradation. Mike, you said that there perhaps could be a trough of three thousand and thirty two hundred in the first quarter of next year as we do get that reality check from earnings, have the recent data with respect to the latest CPI, with respect to some of the other metrics that people are seeing a softening in and that we're hearing a change in tone from the rhetoric of J. Pow perhaps yesterday. Have you changed that view? Does that seem further away in terms of that fair

case scenario? Well, once in in, I mean the bearcase scenario assumes we have probably a modest recession next year. And in that scenario, all we're all that happens is revenue growth goes flat, maybe maybe slightly negative, but that will make the negative operating leverage even worse. And so that's a hundred eighty dollars and earnings next year. So with a hundred eighty dollars and earnings next year, you know, three thousand is not is not really a stretch. So look,

we don't you know, we don't have a crystal ball. Unfortunately, I wish I did. In terms of what I'm most uncertain about is the timing of this. You know, we thought it could have actually happened in the fourth quarter of this year, needing these earnings revisions, and that's one of the reasons we flipped positive in octobers. We felt like it's gonna be pushed out and that's what's happening. Couldn't get pushed out further into the middle of next year. Yes,

do we think we can avoid it? No, so we're you know, we think at a minimum will take out thirty sometime in the first half of next year. And yes, that bearcase, unfortunately is alive, and that's three thousand. In the meantime, let's get one final call from you. What would you buy and hold right now? Got into your rend? What would it be? And it could be a wife in the index she's how may Yeah, well, I think

it's bonds. I mean like we're you know, I think that that that if you think about bear markets that are punctuated by a either economic or earnings recession, we think we're gonna get at least one of those, the earnings recession, the CE. The sort of order of operations is very clear. You want to buy a cat, you want to be cashed first, then you want to buy treasuries long duration, then you want to buy credit, and you want to buy equities last. So you know, we're

already a lot already overweight cash. So front end cash or you own back end treasuries. Now for a trade, Okay, we think it's Nasdaq or you know, long duration stocks will will like that move in rates lower. It's but that's more speculative. That's for the training community, I think for the investment community and for asset owners it's basically bonds might just phenomenal. Thanks for your time and let's catch up before year Rent, Mike Wilson, what we news

dive into this with Joy and Rochester? G turn effect strategist number. I'm gonna ask one question here and how do you not lose money? And then John's going to pick it up and the currency dynamics you just mentioned. Jordan Rochester, you, like every adult out there, uses a

thing like stop losses. You've been enjoying being stopped out of trades right now explained to our audience why it's amateur our If you don't have stops, well, I don't enjoy being stopped out, Tom, but they're absolutely essential to your risk management. I think with the FTX scandal that I think the ANAMDA bragged that they didn't have stop losses, So that's quite clear what can happen if you don't. But look what's happening in the markets, Tom, how to

avoid losing money? Here is the markets looking at US energy prices. They've cooled off year on year, that leads PPI producer prices lower, that leads headline inflation with a lag lower. So it's quite hard to see reasons why the Fed would get suddenly more hawkish, especially after Chair Pal's speech last night signaling that slow down to fifty

basis points. You had a green light from the Fed chair last night to sell the dollar and by risk appetite, and that's why you've seen the NaSTA cup over four percent yesterday. In ffex Tom, the correlations between foreign exchange and interest rates have really dropped off a cliff. The most predominant fact that's driving everything right now is where global equities are going. So I'm currently long euro dollar.

We do have a stop on that round one oh one, one oh one seventy, but I think that's gonna go towards one oh eight. I think that's gonna be something that could go towards one ten in the new year because of what's happening in China, because the low energy prices we've seen over recent weeks in Europe as well, helping boost European production. So that risk on sentiment that

you see in equities feeds directly to the dollar. Now does that famous spider meme spider man meme on Twitter where everyone points at each other blaming each other surveillance. So as EFEX guys say it's equities driving everything, empty guys say it's effects. Well, I just the main point I would say is if you think that this risk on carry on in the SMP five hundred, it means the dollars will continue to weaken into your end and

you play that through the Euro. Where does Sterling fit in? Well, we had short Sterling Swiss on because we thought we needed some RV to hedge are sort of risk one position. Sterling Swiss had been less correlated to the equity market than of of acrosses. But you can't ignore that Swissy is a risk off hedge. So what's happen is we got stopped at that short Sterling Swiss, not because we had some amazing news out of the UK, but for

two reasons. One, everybody agreed with the trade, and that always tells you that everyone's position the same way as you. And to risk one, Sterling always does well when the equity markets rally. It's very rare that it doesn't. Only during Brexit. Really did we see that change in so for the likes of sterling, we think that you could climb towards one by the end of next year. And in these markets, guys, we're seeing big moves and dolly and for example, four four big figures in just twenty

four hours. You know, one is not that big of a push to see earlier if we have more good news. But based on what we know right now, it's gonna be a slow grind higher. It's hard for me to see any of this other than a big dollar story. And everyone else is coming along and rationalizing it in

some way or another. I mean, it was pretty much all of the major currency pairs were really big gainers in the past month versus the dollar, and our people getting ahead of themselves with this idea of fading inflation and a fair that's going to somehow respond to that. I mean, could this really whips are in the other direction? Based on positioning, I think it really cood li SA

But not now. That's that's problem markets. We could have a view about what could happen in Q two or Q three next year, but the markets don't trade that just yet. Sometimes, and I think the risks are for all my leading indicators for inflation in the US, they all point down. There's none of them pointing up. I can't really say, oh my god, watch out for this inflation risk. Look at this chart. They're all pointing to lower entery prices, lower inflation. Therefore, you can say CPI

has peaked, and it's quite clearly peaked. We're looking for no point three pc on the core again month on month. Namura was the only team, the economics team in the US to get that number right last month. So if they get that right again and we have another nor point three or even lower, it's kind of hard for the dollar to rally. But let's look to next year. We could have in Q two China's reopen. Q three we start to feel the impact of that in energy markets,

and the FED doesn't cut rates. Perhaps that's the risk we think they will, But the risks are we have a wave of energy inflation again next year in Q three as energy markets tighten up and demand comes back, and that could change the narrative quite a lot. So right here, right now, I don't think we're getting ahead of ourselves. I think the dollar can can continue to weaken against the euro at least and that should feed

free to risk on another G ten crosses toward. One reason why I love reading our reports is because you've got this confidence metric and you have, you know, three out of five, five out of five. I remember back when you were five out of five. Now you're three out of five. How much are you seeing a lack of conviction or pulling back or humility in some of the positioning that you're seeing across effects as you sort of sort out all of these uncertainties that are lying ahead. Well,

I think there's a lot of uncertainty. What we tend to have in this market is prices moving, make narratives. Narratives then drive research pieces, but fundamentals ultimately drive where prices will be. Right now, the fundamentals are that we could perhaps see software inflation therefore week or dollar. But we're getting to year end and a lot of accounts were sat long dollar for most of this year, including ourselves since February pretty much of of the year when

Russia invaded Ukraine. Why wouldn't you be along the dollars? So that trade is still being unwound in certain sectors, and that means perhaps everything we're seen right now is just position reduction and no one really changing their optimism for next year. For US, we think there's gonna be recession risks. Usually when there's a recession the dollars as well. The problem is we start we're starting to see signs of early rebounds in European p M mice for example,

China's credit impulses going up. So there are fundamental reasons why you could see this risk and be sustained. You just need hope to prevail. And we do have risk coming up. We've got OPEC next week, We've got the EU oil sanctions on Monday as well. That's twenty one of the e use oil imports from Russia being sanctioned from Monday onwards. I'm not sure where they're going to get that one of their total oil imports from in the next month, So there's there are certainly risks to

this outlook. Jordan, you've got twenty seconds. Are you more confident about your europe dollar call or England getting past Senegale later this weekend? I'm pretty comfroment the England team. I mean, we've had the US Gay game. USA game was a bit boring, was like watching paint dry, But what a fantastic Wales game and hopefully they'll bring that back to the pitch. Should Jack Grayler should be playing more? You're asking a Birmingham boy where the Jack really should

be playing more? I just already know what Jordan's going to say. I'm happy with him playing every game, at least in the second half. He gets a showing you know, you've got one of the goals as well in the first game of the World Cup. So this is fantastic for Birmingham. And it's not just greedish. Now I've got to betting into He's grillish is on the urge of Gareth. I mean, he gets on the field and things happen.

He's great, a really classy player, Jordan Ranchester. During you and World Cup, we're breaking it down city to city where these players come from. Tim, You'll get into another level, another level, thank you. I'm just doing it because of

our love. It's so deep. What we do every day is our guests, and it starts and ends with the research capabilities of vincent Reinhart, Assistant chair in green Span over many many years at the Federal Drive US Melon Holding Court and important writings in the pandemic about the state of our economy, vince Reinhart, just a general question of a two hour conversation. Do you buy the idea we're heading for recession? In your years with green Span,

were you able to predict a recession? Nobody really predicts a recession. What you can say is there's an elevated chance of it, just like you could say you have an elevated chance of infection if you go into bad places without a mask. Uh. There is an extremely elevated chance of recession. Uh. And if you had to place your money, I bet that within twelve months the economy

is in downturn. I look at this vents, and then I look at the parlor game of the FED, which is now different than when you were holding court at the Echos building. And the basic idea here is there gaming out a rate movement higher and then we are quote unquote going to figure out to pivot and guess when that occurs. Have you ever seen anything like this or is this mound territory? This? This is old style monetary policy right now. Monetary policy is hard but simple.

It's hard in the sense they have to inflict point pain on the economy to get inflation down. It's simple because the strategy is, if you don't know what the right neutral funds rate is, put it at a level you sure is restrictive, and then keep it there until you have demonstrable evidence that in flaition is going back to goal. So if you're not exactly sure how to calibrate policy, don't put it at a plateau next year and just wait. That's what cheer pal poll is yesterday?

Is that what he told us yesterday? Incidant, did you hear perhaps a little bit more of a concession around perhaps moderating their stance in order to avoid a hard landing. I don't get how most of the headlines came out of that UH remarks. Yesterday afternoon, he repeated his press conference UH characterization, you were raising rates till we get them to a level, and then we're going to keep them there. He dismissed a lot of data with regard. I don't don't want to be on the other side

of Mike's argument, but I think I have to be. Yesterday, Chair Pal said inflation moves around sometimes, UH, after good numbers, bad numbers come out, so I think that they would down down Wait the pce ace part of this, and then what he was saying was we've got to keep the pace of aggregate demand below that a trend, so he should be worried about the spending part about it. This is not a good morning for the Fed. Well vincent.

This is really the key point. A lot of people are saying that there is a downward shift in inflation and it's coming at a pace that's surprising analysts that this is good news, is going to allow the Fed to move away from some of the rate hikes and

even cut rights student than previously expected. Do you think people are getting ahead of themselves, that really those inputs are not declining quickly enough and that they could even re accelerate basis some of the rollover effects in areas, For example, I used cars, events always look bigger in the rear view mirror than they really are. I think there is a tendency to over over overweight this incoming information. Chare Pal said that yesterday. By the way, he said,

inflation ballattle. Sometimes after good readings, you get bad readings. He was basically telling us not to be so stressed about it. Do I believe inflation is off its peak? Absolutely goods price inflation has come off the boil because supply chains have been been improving and market economies work by bringing resources into sectors that are overheated. But it's spill over to service inflation. That's what you gotta worry about. That's what pals worried about, the durable part, part of

inflation that's still above the FED goal. Vincent reinhard Olivia, Blanchard reaffirmed higher level of inflation we can be comfortable with. He went from four percent in the crisis of oh eight oh nine down to something more like a three percent level. Is the new two percent without going into the details of the Blanchard essay and the ft, is he onto something here which we are going to rationalize

our way away from the two percent level. So yes and no. The the s part is back in the mid nineties when central banks settled on a two percent inflation goal, it's not like they had a great conversation about the costs and benefits of that long term goal. And we know more about problems with the zero lower abound and so we should have a serious discussion of what the right goal is In the United States. It's got to inconclude the Congress by the way, because it's

a Congress that's specifies price stability. That's my note part. I wouldn't want to have a conversation with the Congress about the federal reserves goals most times, certainly not in the next in the next two years. Moreover, it's one thing to redefine the goal when you're succeeding. It's another thing to redefine the goal when you're failing. That that's just base drift that you just can't do. It said,

that was really wonderful. Thank you, Meta net Reveala Ferokie joins US now Chief US Economist with Carl Weinberg at High Frequency Economics. Reveala, what is the distinction of what we're gonna hear Friday tomorrow at eight thirty What matters to you and Carl? Good morning, Thanks for having me. What we're really looking at beyond you know the usual you know the headline job numbers, at the participation rate,

its wages, right. The chair Poud made it very clear yesterday what they're focusing on in terms of the inflation uh, you know, dynamics, and that is what we're going to be looking at. We're looking for a very small deceleration but really very far above where the pre pandemic trend was, very far above with what the FED is saying is

consistent with the two percent inflation target. So you know, just definitely is going to be something we're focusing on, but not something that we're going to see, uh, you know, imminent imminent improvement on either. I want to dovetail with the academic site. Guys, it's out there Rebelia and this is the academic saying maybe the labor partition just like labor participation rate is not accurate because of the pandemic and older people retiring. Is this good math that we

see Friday? I mean, we've seen that this adjustment right post pandemic where you've seen access retirements. So we really shouldn't be looking for the participation rate to improve too much. But if you remember, you know, before the pandemic, when the labor market was strong, job growth was strong, but people were coming back into the labor market. So what is the dynamic here? Is growth going to slow off slow enough that people will want to get back into

the labor market. Are their savings going to diminish enough? Uh, you know, is the cushion from uh you know the income support that they've had, is that going to dissipate and they are going to be motivate do to come back into the labor market certainly a possibility, not our base case right now, not the first blase case certainly. You know, if you heard pout yesterday, that's not what

they are expecting to see. So I think those dynamics that that both pandemic distortion is probably going to last for some time. Really, you mentioned fed cher J. Powey in his speech yesterday. Some people, a lot of people thought that it was more devish than expected. At least he didn't come out with a hawkish rebud of some of the gains that we've seen in the equity markets. However, to your point, he talked about the labor market tightness and how significant of a concern this is for him.

How much geth view that that is causing the FED to raise rates higher than the market is currently pricing. And even after yesterday's rally, even after yesterday's perhaps shift slightly in tone from J Power. So you know, what I've heard from what he said yesterday is that higher for longer, right, rates have to rise further. They don't really know how restrictive because they don't really know where

that level is. But certainly we're going to move higher, you know, our base cases, they're going to go fifty, then another fifty in the first quarter, top out around five. But if the labor market does not start responding our base cases, it is right, I mean, five percentage points of rate heights. We don't see how the economy doesn't

respond to that. But if they, we don't see the type of improvement we need to see, and we don't see sustained easing ob wage pressures off of these levels, you know, four point seven percent to maybe three and a half is then yes, certainly the there's this risk that rates move higher. But I think what markets really need to understand is that the Fed does not want to overtighten now because then crash the economy and then come out on the other side and easy rates. So

they're going to go gradually. They're going to watch what's happening in you know, in response to what they've already done so far, and then they're going to see how long they need to stay there. We think that you know, they reach be great whatever that rate is in the first quarter, and then they stay there for the rest of the year at least to see that sustained, you know,

improvement in inflation from slightly restrictive policy stands. People would push back, including Ben Laidler, who says that if you look around, there is disinflation everywhere. Is there any area or that's not true? You're starting to see inflation starting to re accelerate. Well, I mean what we've seen is inflation readings right now are still not that far off peaks.

I mean, seven point seven on the CPI down from nine pound point one percent, quite substantial, but still way above target for pc accelerating, they're going to see a slight we expect to see a slightly sederation, but these are not levels that are consistent with you know, what the FIT wants to see. Yes, there are signs of disinflation, but on the good sides of this, inflation is still

very sticky. What Pow talked about in particular yesterday was that core services ex housing and that you know has a strong wage component to it. So adjustment in the labor market rebound, don't think it is necessary so that those which pressures can come under control, bitch will give them a little bit more room, you know, to sort

of justice see where we're going from here. For a man who set that wasn't spice for nuance at the last news conference, I have to say there was a lot of nuance yesterday had And why thought I didn't anticipate rebate a fantastic as always rebate Ferriki that of high frequency economics. Somebody that was there when Mao took over China was Robert Dahl. He's chief investment officer at Crossbark. He's been doing this a few years along with me,

and we're thrilled. He joins us in the studio. Uh, this morning, you got a little bit in your note there. For the first time in fifty years, we've been this gloomy. We've had this much gloom out there. And that's how I make the joke back. But part of that is years in my history is when inflation moves, it moves suddenly to disinflation. Is that where we are right now? I don't think we're quite there yet, Tom, unless you're going to call acceptable or disinflation three or four percent um.

I think we can get there with what we've done, but not to nowhere close to two Okay, But not to two, but then we're there, and that means I've got nominal g d P which helps corporate revenues. Yes, who are the survivors of a better corporate revenue? Given an inflation milieu that you and I are the only two that have ever lived. Given that we want some pricing power, you've got to go to places where people can raise prices. We haven't been in that environment in

a long long time. And I'm gonna tell Lisa You're gonna love this. I used to go up and down the elevator in Boston with the giant Philip Curay, who Bob and I worship, did I think four? And Mr Kuray would and it is Mr Kay. Mr Kay would talk about the bright lights of inflation. That's where we are now. So if we're gonna talk history, let's talk history, and let's talk a half a century ago, which was the last time that we saw three consecutive quarters of

stock and bonds losing value together? What does history say and is it instructive in terms of what that means going forward? Well, first of all, the reason that happened was the rapid adjustment. We had essentially zero inflation and zero interest rates not to exaggerate by much. Then all of a sudden it fits, Oh it's not transitory, and we got to get moving. And so we've had the most rapid increase in FED funds, and you guys said

it a few minutes ago. The lag is impossible to predict about the impact of that, and so we're going to have a slowing economy and that will help bring the inflation right down. The Fed's got it prey that the labor market quiets down. So one guest after another has talked about flooding into treasuries, flooding into duration. Even Michaelson and Morgan Stanley comes out, what would you be buying the equity strategistic bonds? Right? I mean how much do you lean into that versus step away and say,

maybe people are overestimating how much inflation can drop. I think, Lisa that um owning some bonds is just fine. It's zero at the beginning of the year. You didn't want any When treasuries approach four on the tenure, we say you've gotta be nibbling away bonds. And we're not that far from that now. So the old sixty forty is dead. That we all preached a year ago. Not true anymore. Bonds have a place in the portfolio, especially if you

believe inflation is coming down to three or four. Forget the two for the moment, my theme for next year. You're the only one breathing and remembers, especially coming up of years ago. Remember what is this to Bob and I remember whenever every wise guy in Manhattan said we got to roll up the chemical industry, remember this, we all want mental for eighteen months and turned it into

three companies or whatever. I'm talking about the great zombie roll up next year, where we de market between profit making and cash flow making companies and everybody else. Do you agree with that that there's going to be a demarcation? So agree? And what that means more broadly, as fundamentals matter. Again, when interest rates are zero row, they're artificially low, and you can't really say that the good guy wins from

a stockbright standpoint. How did Sears last so long? The answer is because they were given artificially low interest rates and that was tough for places like Target. Now in this environment, the Targets will do well and the Seares will struggle. Explain to people that under duress corporations adjust. How does that process actually happen. Yeah, it's slow because they've been so used to zero inflation and exactly and

got used to operating in that sort of environment. This is a different world now, and we come back to can you raise your price? Can you attract customers and keep them as your price rises? Look look at what's happening in the steel stocks, for example. You mentioned chemicals, early steeler poking their head up, and this is telling us where an environment where inflation is not going back to zero. I don't think the US steel is still x.

I haven't looked at that year. People are talking. People are talking about how the real economy is getting its revenge. That has been the theme for two and it's rearing its head, and that's why you're seeing the inflation under underpinning some of these commodity sectors. How much does that mean that the other areas that got bit up and thinking big tech in particular can't really come back in the same kind of way and won't necessarily drive indexes

to the same extent. I think you're onto it. We've obviously seen it this this past year, but I think going forward, going to the same sort of issues. If your company that is operating only on unit growth, your unit growth going to be really strong to get you through. And tech is mostly unit growth, I think they will be a lagging sector. Again, what are your clients? What are you cross mark out of Houston and you know a nationwide and all that? Are they loaded up their

eyeballs in cash? What are they actually doing with their money? Yeah? So people, people are asking a lot of questions. Too many people are frozen, um, but they're making investments. You have to hold their hand and draw them to the horst of the water and saying let go get something like that. It's something like that. But they're they're they're they're they're doing something. They're doing more get educated and buying some alternatives, Like we have an equity market neutral

product that's getting some attention. You have an equity market neutral product. Yes, Bob do all the great Optimus, Thank you so much with cross market all the best global investments. This is the Bloomberg Surveillance Podcast. Thanks for listening. Join us live weekdays from seven to ten am Eastern on Bloomberg Radio and on Bloomberg Television each day from six to nine am for insight from the best in economics, finance, investment,

and international relations. And subscribe to the Surveillance podcast on Apple podcast, SoundCloud, Bloomberg dot com, and of course, on the terminal. I'm Tom Keene, and this is Bloomberg.