From Marhart where Innovation of Money and Power Collie in Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde and Ed loved.
Love live from New York and San Francisco. This is Rumberg Technology coming up.
All eyes on Powell Markets on Edge and we watch the tech sector ahead of the FED.
Plus Microsoft and black Rocket teaming up planning to launch a thirty billion dollar AI investment fund.
And Google wins in court this time EU judges overturning the company's one and a half billion euro antitrust Fine, but first check in on these markets, I will Gail Doolittle.
Well, Caroline, we are just hours away from one of the most anticipated FED decisions in years.
Because of course.
It's all but likely that they will and backed cut at this next meeting for the first time in four years. But the big question is we'll be twenty five basis points or fifty basis points according to probability within the Bloomberg terminal. Right now, we are looking at a fifty seven percent chance of a fifty basis point cut. This would be one of the first times this has happened in a non emergency capacity, perhaps raising questions of what are they seeing Why are they going to make such
a big cut if it happens. Not so long ago, former Saint Louis FED president James Buller did tell CNBC he thinks the chances of a fifty basis point cut is actually overblown. So we have seen this probability coming in about five percent since those comments at the highs on Monday at seventy percent, but the main point is more than fifty percent. What has this done for stocks?
Well over the last couple of months, since we have seen some of the sectors, in particular technology peak, We have that magnificent seven in the bottom panel of this chart that we're looking at down about five percent, whereas you have some of the rate sensitive sectors utilities, real estate, staples, healthcare, defensive sectors doing better because their dividends will look less attractive. That is not the case though, since the FED started hiking.
Let's take a look at technology since that time period. It is clearly the top sector, up sixty percent. In fact, all of the sectors a nice rally except for real estate. Higher rates, of course lower the values on real estate. So that is the one loan sector over the last two years that has done poorly and then finally ed. This is mind blowing in a way. In Vidia, over the last two years since that FED hiking cycle had started, up more than seven hundred and seventy percent. We have
the likes of Meta up nearly three hundred percent. Microsoft and Apple not to be left out, both up about fifty seventy five percent, big, big rally for tech, but more recently, as we've had this rotation into other sectors, tech cooling off. But you can see those investors over the last couple of years doing quite well.
Bloomberg's Abigail Dolittle, thank you. Let's keep the discussion going with Megan Horneman's CIO of the Dense Capital Advisors, and we start by asking how significant is today's FED decision for the technology sector.
I think it's definitely very important for the tech sector as well as the entire market. I think that if the yields keep moving higher as we've seen here as of late, then that's negative for technology, and technology is rallying on the anticipation that we're going to get fifty basis points from the FED today. If that doesn't occur, I think that that's going to put at this rally and technology at risk.
There's a part of the mag seven story, Megan, where those names are performing in isolation of everything else that's happening in our world because of the commitment to invest in the infrastructure supporting AI. How closely tied are the two stories that and central bank policy?
Well, I think central bank policy and then the story around technology. They're separate things. The infrastructure with technology the advancements that we're going to see. This is going to evolve over time, but the valuations that you're seeing on these stocks is linked to interest rate policy and as
well as yields. If this interest rate policy does not deliver with what we're in, with what these heightened valuations are anticipating, then you're going to see some valuation correction in these names.
Is that limited to the big caps or more broadly across technology in and of itself, Megan.
I think it's broadly across technology and any even some of the communications services, any of these growth type of names that you've seen with these very high valuations. These high valuations are pricing in perfection. They're pricing in that the FED will come in deliver with these interstrate cuts. They'll come in and save the day like we've been used to over the past couple decades. And they're also
pricing in perfection for the economy these things. None of this is set in stone right now, so I think that there is still there's a big risk here for some of these growth and high pe level sectors.
Is that just in the US or do we see the wind taken out of the sales of European tactoo.
Megan, Well, well, we don't have as much technology in some of the European indices. They're not as tech heavy as the US is. But we have seen the correlation here. When we have the sell off in the growth or technology here in the US, it does tend to filter into overseas as well.
Megan, How important to you and the technology investor around the world is the path forward thereafter? We can't help ourselves, right, We've been waiting for September eighteen and we already ask then what increments do we have further rate cuts in the path from there?
Right?
That's a great question because they can do several things today at this meeting. They can deliver with twenty five basis points, which is why I think that they should do They should reiterate that they're can going to continue to monitor data, they'll act accordingly. It's meeting by meeting, and then if they could go with fifty basis points, they could come in and say this is a fine tuning. We're going to be on hold now, and then you're going to get the cuts that are priced into the
market for the rest this year move out. The most important thing today, whether it's technology or the rest of the stock market is what are they going to say from the dot plots going forward? What are they saying for the unemployment, their estimates that they're going to have to put out, What are they saying as far as inflation, because let's keep in mind inflation has come down significantly,
but it's still in certain areas is very sticky. So their press conference and the projections that they put out after the meeting, they're more important, obviously in fact, to us than whether it's twenty five or fifty basis points.
Today, Megan, there's whole other parts of the capital structure you can earn within technology. What does this mean for the debt corporate debt of Apple of some of the names that have just so much cash on the balance sheet, as well. Do bond markets feel the pressure in the same way that the equity side will.
I think bond marites do, they will feel the same way. I mean, let's be honest that the yields have come down quite a bit. They're backing up a little bit now, but yields have come down substantially. And then when you look at the longer term over the over yields and whether you're looking at long term debt, there's just this focus on treasury. There's a main there's a major issue from the treasury side of things, that is the deficit,
and there's not been anything to address that. And I don't see even with an election coming up, that there's anything that's going to change that. The amount of issuance on that long end of the curve. So anybody who's focusing on debt or has is debt heavy, and I've realized that technology sector is not as debt heavy as other sectors going to have an impact on these long ends of the of the yeal curve.
Megan, I'd like to end the conversation by trying to learn from the year that's gone about what might happen in the year ahead. And I use in Nvidia as the case study capital expenditures an investment. But the other phenomenon that's happened is retail investors have pied piled into in video as well. How does a change an interest rate environment just kind of change the fanfare of the market and the psychology of the market over the next twelve months.
Well, it all comes down what is the price of those stocks.
And when you look.
At stocks that have very high elevated price to earnings multiples, we saw what happened in twenty twenty two. If interest rates rise across the board and you see those high pe level stocks and that's technology specifically, they end up getting hurt by this. So going into next year, I still think the Fed has the flexibility to continue to cut rates. I just don't think that they're going to deliver the way that the market is pricing this in right now.
Burn and c IO, Megan Hornemann, it's great to have you today with thank you. Look what's interesting about these markets is perhaps you wish you had the investment vice or decision making prowess of well the investing elite ed think Warren Buffett, think Stanley droc and Miller think David Tepper and so many more. Today we understand and ETF is trying to promise just that sort of power of AI fintech startup Internigion Alpha. They're launching a chat pot
powered by chat Gemini Claude. They call them the Investment Committee. They're going to act like these hedge fund officionados to make decisions.
What do you think?
We know the obsession of the market of those names. But what I find astonished about the story is the simplicity of it that basically it's a strategy generated through a generative AI tool. You listed them, but you just go into it and ask what's the strategy here? What would Warren Buffett do? And you get a response and then.
The ETF trades off it.
I don't know, We'll see how this one plays out, but it's an interesting launch today.
Meanwhile, coming up, we've got so.
Much more to talk about, and of course there's a serious side to what's happening in terms of geopolitics, and it affects technology because pages and telecom devices are exploding in Lebanon more in the developing situation.
Next this is Blue Meg Technology.
An update from Lebanon More Pages and other telecommunication devices exploding in Lebanon, just one day after a series of similar deadly blasts. That's according to reporting by the state run national news agency. Bloomberg Television's Jamana Bassecci joins us with the latest. What do we know about the events of the last hour and what's happening in Lebanon.
Jamana, that's right, So it appears that another attack on Hesbala's telecommunication devices has occurred. Just in the last hour. We are hearing of handheld radio's walkie talkie devices against also exploding in people's hands, cars and across at homes. Even and this of course comes after yesterday the attack where more than two thousand pagers when off, simultaneously exploding
into the pagers that these Himbala operatives have been using. Now, it is important to note here that Israel has declined to take or has not commented on any of the attacks that have taken place or the incidents. But both Hezballah and the Lebanese governments were quick to point the finger at Israel, saying that Israeli intelligence would have been behind this very elaborate operation. But what is clear here is that this war that has been going on a
hot war, so to speak. Ever since October seventh on Israel's northern border has developed and transformed into a new type of warfare as cyber warfare, and lots of questions are being asked about how these specific devices have been compromised.
Can you tell us a little bit about the supply chain ultimately here, Jeman Or of what you say is an elaborate attack, the Taiwanese company gold Apollo has spoken.
Out yes, So the branding on the pages that were detonated yesterday can be pointed back to a very not well known Taiwanese manufacturer called gold Apollo, and they actually issued a statement saying that those sicular models that you were used for detonations yesterday were not ones that they manufactured themselves.
Instead, it was actually.
A company called BAC that were based in Hungary that had obtained the licensing to use the branding on devices that they manufactured. Now, Bloomberg did try to reach out to BAC for comments, We have not heard back from them.
But again, all of this is part and parcel of a very elaborate plan, and it seems to be the case that it's not just the pages that were compromised, but other telecommunication devices that Hezbollah militants have been using, and experts in the field say that the way this could have been done is by whoever tampered with the
devices putting in small quantities of explosive device. They ten explosive material ten to twenty grounds that would get triggered on a signal that would come through so that they would all explode simultaneously. The country is on high alert because this is the second such intelligence breach in two days.
Several parties involved and we're awaiting responses from others who understanding is that Lebanon and Hezbullah, which is a group the United States announces as a terrorist group, have accused Israel of being behind the attack. We haven't heard from Israel. What else do we know about the political situation?
Yamana, Yes, well, again it is fast moving and as I was just highlighting, within Lebanon, now there's major concern that we're moving to a new type of warfare and that in the past the war had been conducted solely on the southern part of the country in borders. But now what's happening is there's been a complete intelligence breach. People are very concerned about what this means for telecommunications within the country and the potential for further action or
further operations coming out of Israel. The background to this, of course, since yesterday the Israeli Prime Minister Benjamin Attaannapolos said that there is another new war objective now, and that is to return security to the northern border of Israel, so that citizens within the country can return back. They had been evacuated and had been forced to move dis plate ever since October seven, and so there is a focus from Israel and from the Israeli government to do
something about the situation on that border. The concern of ours is that in the absence of the diplomatic solution, we may be looking at something like a full scale invasion.
Risk of a serious, dramatic escalation is what the United Nations is currently saying. Jamana Bassecci, thank you so much for coming to us from Middle East. It is time for today's AI in action. Well bringing in Catherine Costareva. She is the CEO of Creatio. It's a no code platform enabling that the automation of workflows and CRN thanks to the power of artificial intelligence. Just announced two hundred million dollars in new funding over the summer. You've got
a one point two billion dollar valuation. The value of what you provide is well, less engineers and code is needed. I can build my own application using just creatia.
So true, And first of all, thank you very much for having me. I'm excited to be here today with you. And you know what, when we founded the company ten years ago, the biggest value we brought to our clients was time to value the ability to build your applications, not being a professional software developer. And right now we're doing that with the help of AI, and that's definitely the future.
In the world of technology.
I think we so ask ourselves about disruption versus what the incumbents are doing. And I've spent a lot of time with Salesforce and speaking to Salesforce executives and they would tell you, Catherine, they're doing exactly the same thing.
How do you respond to that?
Oh?
Love the question. So let's start with the evolution of coding. Right, if we go back into eighties, it was high coding. You basically couldn't build the application, not being a professional software developer, and then low code came. It's like rapid
application development industry and then no code emerged. So what Creation is doing different from our competitors is actually giving the ability to design your applications not being a professional software developer, which and not being in tech industry at all, which actually allows time to value, time to market to
be significantly faster. With the help of AI, you not only develop your own apps and automate multiple use cases, you actually replace people in multiple different rules like case resolutions, like sales management, like campaign management, and in comparison to Salesforce, the biggest difference at Creation is that you build those intents, you build those use cases, not being a technical person, so you define the use cases where AI is helping
you to automate tasks without being a professional developer. On the creation of platform, you.
Said replace people.
For many that is the key worry around artificial intelligence. Most people try to say they'll be augmented. Have you known that your clients replaced people?
I love.
Looking at it through augmentation, right, we actually empower our end users to do their job better.
But you said replace people. So have people been replaced at your clients?
Do you think partially yes? Like if we talk about call center like people are doing more intelligent work, so replaced in a very good way because basically AI is taken over routine tasks while more intelligent work is being done by people like let me give you an example with building workflows, building your own applications with the help of AI. AI does this work for you while you do more intelligent work, which is integration of workflow apply
keations into the ecosystem of your organization. So it does require more skills, which is a benefit for workers because they can grow in their professional skills.
We want to thank you for bringing the pros, the cons and indeed what you're building the creatio and your valuation.
CEO Kevin Custareva, thank you very much.
Indeed, now shifting to another part of AI, Blackrock and Microsoft, they're teaming up on one of the largest efforts to date to bankroll the buildout of data warehouses and energy
infrastructure behind the boom in artificial intelligence. This of course being a normous undertaking from an infrastructure perspective, and we want to be digging into some of the intricacies around this particular deal that has been struck between an enormous asset manager and indeed Larry Fink was posting on various platforms yesterday ed about how much they are seeing this whole seismic shift and the need for artificial intelligence, the shares scale of money needed.
But actually he seemed to think it was relatively easy to.
Come by, Lin Dahn and pleased to say, joins us more, Lynn, this is a massive amount of money and expertise coming from in video too.
It is, and thank you for having me. It sounds massive, doesn't it. Thirty billion dollars sounds massive, But it's just the tip of the iceberg. I mean, remember that even before this thirty billion dollar fund was announced, Microsoft had already had already signed a multi billion dollar contract with Brookfield just to build some renewable energy plants that would in turn supply the electricity for data centers that are
necessary for AI. And before this announcement, we had this scoop on how Sam Altman, the head of OpenAI, was working on his own plan for AI infrastructure and pushing for it here in the US. That would have also cost tens of billions of dollars. So we are in the end talking about hundreds of billions of dollars of AI infrastructure necessary to keep the boom happening, and this is just the latest announcement exactly.
So when I read this story by Boomberg Center, Rush and Dina Bass, it's all the same names really that we've been talking about. What's different a little bit about the black Rock and Microsoft initiatively seems to be there is a more micro focus on energy, but also deploying capital outside of the US as well.
That's right, and that is actually something that has been a big part of Sam Altman's push too, has been going out there abroad trying to attract foreign sources of money to fuel this AI boom. It was very interesting to see the Abu Dhabi Fund invested in this. But also, as you said, the energy part of it is the critical part. And when our very own Bradstone interviewed Sam Altman at Davos a year ago, he said something very similar.
He said, I don't think that the world has yet realized how big of an increase we are talking about in energy demands.
Because of the AI boom.
By our estimates at Bloomberg Intelligence, we're talking about possibly ten times more energy being put toward AI data centers by twenty thirty than today's levels. So for sure, the focus needs to be on the energy aspect of the equation.
Just briefly, we know that people were the administration at the White House last week talking about aim structure.
Is this the fruits of those labor That's right?
And I mean, I don't know if this fund is the fruits of those labors, but for sure, what came out of those conversations, as far as we know from sources, was an agreement for a task force that would look
at these issues together. And I think that a part of that, we'll be looking at all of the permitting and the regulatory hurdles that need to be cleared in order for these massive power plants and data centers to even be fathom for one to even fathom them being built in the US, just in terms of like the environmental permits and the space.
Blue Boslindann, thank you very much.
I'll come back to Bluebog technology. I'm Caroline Hid in New York.
Mamed Lalalo in San Francisco.
The day is here, ed fed day two pm.
Will we get a rate cut to the junior twenty five or fifty basis points that is what the market weighs and watches for and we currently just tread water basically on the Nasdaq one hundred.
We're off by a tenth of a percent.
Now there is some concerns the risk a version building is to what it means for technology once we get those rate cuts. Let's move on and look at the individual movers, because actually on the higher side, we have got Apple powering higher today and this is the biggest lift from a points perspective, or up one point seven percent. So all eyes on those mags seven names and where they can continue to run in the way that we've
been so used to even with a hiking cycle. We're looking at for you, ed Ubisoft, I do Star Wars Outlaws. There's been a lot of worries about this new game. And actually for once we've got bmo annas they're saying it is so cheap now this French name of maker of of course in the latest games that we've got to be buying in it jumps more than six percent. Remember it is down about fifty percent year to date though, And I'm looking at Alphabet just treading water also ahead
of the FED. But there's been some interesting micro news. Yes, there's a YouTube creator's event happening right here in New York and some unveilings there. But there's a key event that happened earlier in Europe and you got the details.
Yep.
Google won a court fight with the European Union over a one point seven billion dollar fine for illegally stopping rivals from placing ads on third party websites. The court cited key mistakes in the original twenty nineteen pro Bloomberg. Sam Stalton joins us from Brussels. So this is a positive outcome for Google. Explain the basics of the court's decision.
Yeah, so it is actually quite a rare win for Google in the European Union's courts. Here, it's important to say this is a win in the lower tier court as the EU General Court in Luxembourg, So the decision can actually be appealed to the European Court of Justice,
which is the bloc's highest court. Effectively, this one point seven billion dollar fine was slapped on Google in twenty nineteen after EU Antitrust Chief Magadeta Vestage said that it was illegally preventing rival search engines run by the likes of Yahoo and Microsoft from placing ads on websites like online newspapers, travel platforms and blogs, etc. But now, of course that one point seven billion dollar fine has been struck out by EU judges, who, as you've just said,
cited a number of errors in the Commission's investigations, including in their definitions of certain things like market definition and the duration of the alleged abusive behavior.
Yeah, I mean Google itself funnily enough, saying they're pleased with this response. They said it really factored on a very narrow subset of text only search ads, and basically they've gone back and changed the con tracks from twenty sixteen. But this isn't the only focus on ad tech and its power within that space, not just in Europe but also in the US.
Yeah.
Indeed, so you have too parallel I suppose fronts really on Google's advertising technology business. So the case today was really more about display advertising, but when it comes to advertising technologies, there's a much more if you like, existential risk to Google's long term sustainability in these types of markets.
You have the Department of Justice case that's obviously in broad in legal proceedings at the moments, but also in the European Union they have their own investigation open into Google's advertising technologies, which we assume could lead to an eventual breakup order potentially in the coming months. That's an
investigation that still needs to be concluded. That the European Commission is certainly making progress on what would be its fourth investigation into Google business and potential abuses of dominance.
Samas Dalton me, thank you so much on all things EU versus big tech. Let's talk about what's happening on the hill in big tech because tech firms will be the focus of a US Senate Intelligence Committee hearing on election threats. Executives from the likes of Google, but also Microsoft and Meta are all set to appear.
It emerges.
Jackie Davilas joins us from DC with more who expected to hear from today?
Jackie, Well, while everyone's tuning into the FED decision, I'm going to be on Capitol Hill at that Senate Intelligence Committee hearing, and we're expected to see executives like Google's Can't Walker, Metas, Nick Clegg, and Microsoft's president Brad Smith.
And really what the focus here today will be what is the role and responsibility of tech companies in detecting misinformation and disinformation online, particularly as it relates to foreign interference in our elections, and this has been a key focus for this bipartisan panel. It's chaired by a Democrat, Mark Warner from Virginia, and the vice chair is Marco
Rubio from Florida. This is an issue that both sides of the isle care about, and what they want to understand is what have companies been doing to fulfill their commitments to detect this kind of interference in elections online. Now, just yesterday, very timely, Microsoft published a detailed report that showed that Russia was actually spreading phony videos online that
we're targeting Vice President Kamala Harris's campaign. And this is just kind of the type of report that you've seen some tech companies come out and publish and say this is what we're seeing from our end of things. Open AI and May also released a similar report that says they detected some foreign interference from actors like China, Iran
in Israel in trying to change political discourse around the world. Now, open ai won't be present at the hearing today, but this is the kind of report and action that senators want to hear. You know that the companies are proactively doing to prevent this kind of disinformation from proliferating.
What the US voter Bloomberg Technology audience member might ask is, well, hold on, it's less than two months until the election. So is this great Senate hearing with these technology executives going to have a focus or an impact on the upcoming presidential election or is the idea it's bigger picture, the integrity of our election's longer term.
Jackie both ed and that's exactly right. I think Russia is such a focus for this committee on both sides of the aisle. They've clearly been trying to sway US elections even before this upcoming one in November. But what you're saying exactly, it's this integrity, you know, our institution in people's ability to believe that what they see online
is actually true. Now, we don't have a lot of time before the election, but as you know, things spread so quickly online, especially in this new age of generative AI, and so whatever they can to do to at least put the spotlight on companies so they can proactively move and detect and prevent this kind of stuff from making it onto our phones in a second. I mean, it's an effort, but will it be effective is yet to be seen.
Taylor Swift has had rather a lot to say about it. Of late Bloomberg's Jackie Devilos, We thank you and have we got coming out?
Some more news headlines from around the world. It's time for talking tech us up. Amazon named SAMMYA. Kumar is its new head of consumer business in India starting October first. Kumar joined Amazon in nineteen ninety nine and also leads the consumer businesses for the Middle East, South Africa and Turkey.
Plus.
JP Morgan's in discussions with Apple to take over their credit card portfolio from Goldman Sachs.
JP Morgan among a slew of.
Credit card issuers that have looked to take over the Apple card, which launched with Goldman five years ago and is now seeking to look elsewhere. And hackers behind a cyber attack of drug distributor Senkora were paid seventy five million dollar dollars.
That's according to sources.
The payment was made in three installments in bitcoin and is the largest known cyber extortion payment ever made.
Caroline Wow coming up twenty three and Me's entire board so Special Purpose Forward just quit in protest of the CEO's plans.
To take the company private. Details.
Next, this is bluem Meg Technology.
We're watching shares of twenty three and mes actually rebounding after well seven all of them. Independent board members resigned yesterday protesting CEO and Rajiski's plan to take the company private, and the directors said that there hasn't been any notable progress on presenting a proposal. Who most Leanna Baker has more on this. I mean it's only up two percent
and it has been under pressure. This is extraordinary. It was a special committee to analyze whether or not a deal would look good and clearly they're voting with their feet.
So it's an interesting situation. And Anne Rodjiski actually controls the company, she controls the vote, so it's all up to her what happens. But a special committee did form and they've been waiting for a fully financed offer to come in and that just hasn't happened yet. So it seems like they're frustrated. And some of these big Silicon Valley names are on the board, like Sequoia's role if the Botha has resigned in others, so we'll see what happens.
But Anne wojisk does so want to take the company private, and really the balls in her court because she has a control of the situation.
It's one hundred and eighty million dollars less than market cap company trading at thirty five cents a share, nowhere near it's seventeen dollars sixty five cents peak. Doesn't seem that hard. I mean, what do we know about the financing package. Who's going to be getting involved in the take private Leanna.
At this point, we don't know who would be involved, but we know that Wajiski has bid forty cents a share, which is above where the stock is trading, although it is sort of a penny stock. You remember that this company went public through a SPAC deal and it did have high profile backers before, like Richard Branson and other big names. But at that point it was worth several billion. Now it's just a fraction of that. And we'll see.
For now, the special committee has a banker. We're not aware if the company itself is exploring a sale, but Wojiski has said she is open to other offers. So it could make sense for this company, out of the limelight of the public markets, to sort of reset and potentially restructure to return to growth.
Blom Bose Leanna Baker, who leads our deal's team, thank you very much.
Just get some more news.
KKR and Goldman backed home renovation startup live Space is getting closer to going public. The platform connects customers we've designed for home makeovers in markets like India and Singapore. Expects its first net income in the first quarter of twenty twenty five. Live Space skits eighty five percent of its revenue from that India market.
Carol, Let's talk.
About someone who's probably eyeing the IPO market and indeed the venture landscape. Some with a lot of expertise, like Goreguaz with us Bryden Park Capital partner co founder just made a recent JO one and fifty million dollar investment, for example, in the ticketing marketplace Tippic. And you have significant expertise having run big tech businesses yourself. Mike, what do you think of the IPO landscape? Are we going to rev back up post election?
You know, I think it's a it's a strange environment where in order to go public now, I think there's a bigger burden for quality and I think that there's so many companies that have gotten to rule of forty. They're proven, the big can managed customers that they're SaaS companies,
they've been through several renewal cycles. I think we're going to see a lot of companies, you know, running out to an IPO, and there's a lot of investors that are looking for liquidity, So the pressure between the companies being stronger proven as well as you know investors looking for liquidity. I think you're to see a number of IPOs come out in the new year.
All of forty being and your revenue growth rate, profit margin being at least forty percent, so looking strong and resilient. Where then do you make your bets in the very early stages we just talked about how you assigning money to take pic to be able to take on the nights of oh cee Geek and other areas, to buy tickets to real life events where else looks at appetizing right now, Mike, I.
Think you have to have a philosophy and a thesis of where you want to invest in. You don't definitely don't want to be investing in what's happened in the
past or incremental solutions to legacy systems. You want to be into difficult, high ip hard problems to solve, and when you take a look at that, you know the areas that we think are soon exciting is anything to do with AI and being on the place of AI, where we're trying to help companies solve bigger problems that have never been solved before, or adding massive value to problems that currently exist, but doing it better, faster, or cheaper.
We have a handful of investments that we've done along that those ways. You take a look at a company, we have Corelogics. It started off as a logs company and they've added three new products that are massive tams. Silver Fort in the identity management space. If there's anything that you want to be paying attention to right now is zero trust and identity management. And when you take a look at how Silverfort solved that problem, they've done it in a way nobody else has ever been able
to do it before. You know they can solve you know, multi factor authentication, So the same thing that irritates us alve where you put in your password and they send you a text message. You can never do that for service accounts or for on premise systems, and silver Fort has absolutely nique technology to be able to do that that nobody else really has. So you want to be thinking of those types of things. How do you build a big company when you start with a company that's just got one product.
Having a focus on cybersecurities is not unique, Mike, But we have loads of people in the show that say it's right for disruption.
But it seems like a crowded field to me.
You're one hundred percent correct. I think I see two or three things happening in cybersecurity. You know, everybody's moving through this concept of XDR and the whole notion is we've been actually pretty good at detecting, we haven't been great at responding. And we have four million people in the cybersecurity world right now that have experience in cybersecurity.
We need eight million.
There's no way we're going to be able to get four million more people that are highly qualified in cybersecurity. So it's going to have to come through automation. And I think AI is gay play a significant role.
In making that happen, Mike, real quick, because I can't resist it's what's it like being on a cap table with Rory McElroy.
Well, Roy's a you know First of all, he is an absolute gentleman, and he's actually very good investor in You know, it's nice to have a celebrity like that, especially a quality person of his nature associated.
With your firm.
Mike Grebuire of Brighton Park Capitol, really good to have you on the program.
It's been more than fifty.
Years since an astronaut last walked on the Moon, but this decade could see a number of countries attempt to send humans back. So who's in the race and why now? Bloomberg's Tom Gibson has more listen to this.
America plans to send four astronauts into Luna orbit, including the first woman and first person of color, as part of the Artemist program. This will set the stage for the next artem mission to have people on the Moon in the next few years. But while Neil Armstrong only spent a few hours on the Moon, the Artemis astronauts will be there for much longer, spending at least six days on the lunar surface. China also hopes to have people on the Moon by twenty thirty.
Jane Tongo kum Jiang Kirk with a Triniatian.
Die and has achieved a series of impressive firsts. It was the first and so far only nation to land on the far side of the Moon and the first to send samples from there back to Earth.
Going to the fares side of the Moon is especially hard. Of course, it never actually faces Earth, and so communicating with anything on the farest side of the Moon is really really hard.
All this has America worried.
I don't want China to get to the South Pool first with humans and then say this is our stay out.
Bill Nelson, the NASSA administrator, has frequently referred to China's policies here on Earth, in particular the South China Sea, where China has said all these islands in the South China Sea, they belong to us. Bill Nelson has said in the same way that they did this grab in the South China to see their potential that they would try to do something on the Moon, and so we have to make sure to stop that.
You can catch the full episode at Bloomberg dot com. Now let's get back to the tech markets, because today or here on Earth, is fed Decision Day primposed Shinani Bassek. Look, you're looking across assets as you do on your show day in day out. But we want to shine a lens and what's happening with technology within the implication of the bill market.
For example, absolutely, let's take a look at what's just happened to the two year or for example, over the past month, and what it's meant for technology stacks and if there's been a relationship. The two year over the past month has drastically fallen in terms of the yield movement here more than forty basis points. If you could take a look at that, you are down now to three sixty five, with the market expecting that the Fed
would cut fifty basis points today. Of course you have economists more in disagreement there, but with that pricing moves, let's flip up the board and see what the SMP and the NASDAC have done over that timeframe as well.
And in fact you have.
The Nasdaq outperforming or the S and P five hundred rather outperforming the Nasdaq one hundred, but the S and P five hundred really rising marginally and the NASAK flat to lower. If you flip up the board one more time here, because this is where you actually see that move much more distinctly. The SMP equal weighted index, which had reached a record yesterday, is up more than three
percent over that same timeframe. This is really paying more attention to those companies outside of tech in a more equal way. With a mag seven down one point seven percent, even with that yield movement being so drastic on the move lower, this Philadelphia Semiconductor Index down five point six percent, almost five point seven percent, and only a handful of
stocks really in the green over that timeframe. So what does that say At the beginning of the year, when people have thought that a lower discount rate would really fuel these tech sacks, that has not happened in the past month. So what you really need then is a new narrative that is based on earnings, that is based on that AI payout and not as related to interest rates as we had expected in the past.
Caroline Shnali I looked up from my desk this morning, massive TV screen Bloomberg Open.
Interest, the show that you anchor.
Forwards fed's day, is here banner across the screen. How palpable is the excitement, tension, anxiety of all the investors you have on your show, particularly those that are focused on tech.
Listen, it's fascinating because on one hand, the AI story has dominated this market, has it not, And you felt that excitement to shift away. Actually for a moment this morning, ed away from that story about interest rates and towards that text story because it is still driving so much of the market. I think about what Kate Moore over at Blackrock said, and this idea that perhaps people are taking the chips off the table right now. They could be taking the chicks off for a little bit longer,
but that doesn't take away from today. The idea that we are on the precipice of a historic rate cutting cycle twenty five or fifty at the end of the day could cause some volatility, but the rate and the path forward is what really matters at the end of the day, complicated even more by an election in November.
Shanani Massek and thank you so much for talking us through it all. That does it for this edition of Bluebog Technology.
But look, as we expect that momentous decision, we're not doing all that much. And then as that one hundred by three tens percent, a little bit of anxiety ed.
I think that's what the market is called treading water anxiety. But we're very excited a lots recap in the show Away from the Fed recap the podcast.
You know where to find it.
On the Bloomberg platforms, on Apples, Spotify, and iHeart Big thanks to the team out in New York City. Big thank you to everyone here in SF. This is Bloomberg Technology.