Peak Everything with Gina Martin Adams

need to start exercising again. Uh so, Eric, A lot has happened in the last year and a half. Um, I'm really glad that we can see each other across the table from now. But we're not alone either. We have a guest and I'm really excited to speak with her. She's also here in person. Yeah, we're all in person for a change, and it feels good. And this guest, Um, besides being my boss, by the way, Um is the chief macro strategist and equity strategist for Bloomberg Intelligence and

so on our team. I always go to her listen to her about just what's going on. In the stock market, and not only that, what influences the stock market, things like inflation value versus growth. Um, how you know interest rates in the FED or are looking in earnings? Right, So I figured, given the markets had a long nice run since March, since the last time I saw you, we should check in on how everything's going from like

a macro strategist point of view. And then obviously E T F s or are ways to play those opinions and views, but sometimes it's good to just talk about the yeah about you know, four thousand foot view of the whole thing, and and so to welcome her, I'm going to do a thing and I'm surprised. I'm gonna surprise you with this thing. It's it's gonna be my stadium voice. You ready for it? I don't. I don't know, Gina Martin them, that's terrifying. Thank you this time on

Trillians Looking into the Crystal Ball with Gina Martin Adams. Gina, welcome back to Trillians. Thank you, thank you for having me. So good to see you in person. Yeah you, um so, I remember the last time we talked, and it was like you you went some places that I even you know, reading Bloomberg coverage all day every day you blew my mind. Well, thank you. So I want to talk about inflation. First,

you do a webinar called Inflation Nation. It has been a thing that has been very spooky to the market of late um and will remain, I think a source of concern for a while. So, so break it down for us. What what what's your perspective on it? And what are people what should people be watching out for? Yeah, so the reason we called the webinar Inflation Nation is is because it's our US equity outlook. So just isolating

the US in the global equity market. The US as inflation currently in the nineties percentile of history of the entire history, the biggest CPR or pp I print on record. Pp I was growing nine percent year over year as of the last print. We've never seen a number like that before. And everyone thinks that this is a one time deal. They think that because we're seeing inflation peak and it's going to come down, including the Federal Reserve.

As long as inflation is peaking now, it's going to settle at a lower pace and all it's going to be fine into the future. There's a word that gets around a little bit transitory. Yeah, this transitory notion, So we wanted to explore that. We talked through you know, what do you do in an environment where inflation is

peaking and coming lower. But also really I question this notion that we're going to settle at an inflation rate that looks like the last cycle for a lot of reasons um and most importantly in terms of implementing investment strategy around inflation. I think this is a critical turning point for cyclical sectors to continue to outperform defense sectors, for value sectors to really take the leadership baton over tech, consumer staples, large kept growth sectors. And it's because of

our sort of secular inflation outlook. I don't think we're going back to experience at all. I think instead the experience that we've had over the last couple of years is setting us up for a much faster pace of inflation into the long term outlook. So this whole transitory discussion really takes away from the implementation of an adequate investment strategy that can continue to perform well in an

environment where inflation is secularly shifting. It's not just about this transitory argument, which everyone's focusing on because of the short termism of markets in general. It's really about inflation is going to settle at a faster pace. What do you do because it's not the strategy that you had from two thousand nine to twenty or two thousand ten. And can you just explain why inflation being high would be good for those cyclical sectors? Um and you know

you said value small cap national stocks. Why is it good for those? So for a lot of different reasons, it's better for cyclicals because higher inflation is probably going to be driven as much by a faster demand cycle than we've experienced in the past. Why are we going to have faster demand growth? Why are we gonna have faster GDP growth? In my mind, we're going to have faster GDP growth partly because the private sector in the

United States is flush with cash. It's a completely polar opposite the experience we had coming about out of the Great Financial Crisis, when nobody had anything. Households were in complete disrepair, they had no cash, they were really struggling to get out from under extraordinary debtloads. Corporates likewise really didn't have a tremendous amount of cash. They were able to continue borrowing to fund growth, but they didn't have

all this cash stored up. As a function of the fact that we had the most extraordinary expansion in fiscal and monetary policy in US history, in households and corporates in the United States are sitting on more cash than they have ever had. The result of that, I think is a long term cycle of much faster demand growth. Everybody talks about the supply side. They talk about the fact that, oh, supply chains are in disrepair and they're

going to get better. What nobody's talking about is the fact that we're going to have faster GDP growth, probably for a longer period of time than anyone is seen in a long time. That is going to fuel a much faster cycle, which generally benefits the faster earners. The cyclical though, those segments of the market that are exposed to the cycle, right, So that's part of it. Also, when you have faster inflation, you generally assume the commodity

prices are on the up. Commodity sensitive sectors do particularly well. We've been through a period of time in which capital spending has been absolutely nothing. There's this coiled spring of pent up demand for capital spending. That should improve the outlook for industrial space. The big laggard in my mind and this kind of market is tech. Nobody wants to get out of their tech stocks. Everybody loves their tech stocks. But I think that that era is largely over environment.

Part of it is because tech effectively operates as a defensive strategy. Tech had faster growth when growth was slow, all of the all of the growth sort of concentrated in that one segment, right, And now that growth is more equally distributed across segments, is more cyclically oriented, is more industrially oriented. You have growth opportunities emerge in other spaces. Also, when you have those sort of grower when you have a very very slow growth environment, you're much more sensitive

two interest rates moving, You're much more sensitive to margins. Uh, and tech has ample amounts of ability to borrow. They also have higher margins. So they looked like the darlings of the last cycle from a secular perspective, I don't think they'll be the darlings of the next one. So that was a pretty um us central yes explanation. What about inflation elsewhere? Because um, you know, we won't be

alone if that ends up being the case. Yeah, So what's fascinating right now is inflation really is almost a US centric phenomenon. It is not happening at an above average pace in roughly half of the globe. In much of the globe outside of the United States, there's still this UM really a significant struggle with rates of coronavirus infection via this now next delta variant, also very low

vaccination rates. So the result is what happens in the US is we have much faster inflation because our demand growth is accelerating already. On top of that, you have much faster inflation because the rest of the world can't supply us with the goods that we've become so accustomed to getting from the rest of the world. So it amplifies the problem for the US. Really, the concentration of risk is in developed markets US, Canada, maybe Germany, where

you have pretty strong rates of vaccination. You also have some import dependence, some goods price sensitivity still UM and it's very concentrated. It's definitely not a global phenomenon. Most of Asia, for instance, has below average inflation prints still. So you just talked about these areas that were cyclical and and i'll I call them the bench players, value, small caps and emerging markets. They've been bad for ten years. At the beginning of the year they started to break out.

Your call was exactly right. In fact, listen this that those three areas and ETFs contributed about thirty three percent of the flows up through June, but since then only two the whole trade, all of those have just fallen off a cliff basically, and this sort of tech growth has re emerged, you know, ARC and that whole trade, the cues And that's been about six weeks now, right, You think that's just that's the head fake. It wasn't that the five months before was just another long head

fake from value. Yep. I think that the head it is the last six d eight weeks, and it may last for another six day eight weeks. It may last even longer than that. But it ultimately to me is we probably got a little bit too over inflated in our expectations near term for inflation to really break out in the short term. Inflation indicators peaked in the short term as of May June, and that took some of the window of the sales of the cyclical value trade.

That said, none of the long term charts have really crashed, especially for things like value and financials. Small caps is trading sideways. Emerging markets has been pretty poor, So it's the laggard in that grand scheme of things. But I attribute a lot of that to what's happening with vaccinations, and in my mind, the opportunity is still there. It's just a matter of time before the vaccination has become well distributed and those economies can start to make their

way back. But and to that point, um, you know, when you think of inflation going up, I tend to think interest rates would be correlated with that. But the again, the past six weeks, rates have dropped and so we've had a Russianto Treasury e t f S. Again. You think that is a temporary Yeah, I think it's a function of the fact that inflation expectations peaked in the

short term. Um, I think the Fed has played a little bit of a part in this as well, because the bond market is appears to be starting to get a little bit worried about the FED normalizing policy, and the bond market is doing what it does every time over the last ten years. Anytime the Fed's talked about normalizing policy, everybody ran into bonds. You know, there's just a big tantrum, and they they just think, oh my god, without the Fed, how can we possibly survive this? And

so everyone rushes back into bonds. And then we realize, oh, actually the economy is still fine. It's just it's just a matter of time. In my mind, is there's just a little bit of a freak out in the short term. I think it's great, frankly for the longevity of the trade that folks are so paranoid that it was a short term blip. The value rally was such a short term blip, and when we look at the long term charts,

it was barely even a recovery. Value factor is still extremely cheap relative to the rest of the factors, so I think, but you do have to have a view that you're going to settle into a longer term, a higher pace of inflation longer term, and that rates are ultimately going to go higher in order for the value trade to work. I think that the market is just sort of really struggling with that view right now. And in e. T. F Land, if you were gonna, you know,

take that thesis and run with it. Who who potentially looks like the big winners and breakout stars. Yeah so again, value ets have taken in fifty four billion dollars through me. Their old annual record is thirty so they're through half a year. They've broken the annual record by almost That's

the how crazy people got for value. I just worry, you know, in small caps too, although to a lesser extent, but value et f s in particular, a lot of the flows and e t F are off these models that have these signals, and a lot of them are

technically driven. And I do wonder because I've seen a couple little it's almost like spring leaks and the dam of flows out of the value et F And I'm wondering if value crushes between some moving averages, do the models get triggered and all of a sudden it's this downward spiral. And it's worse because it seems to be six weeks you start to get to a point where

the technicals break down though, yeah you do. And there's also this coincidence of value and momentum right now where if momentum breaks lower, it's going to be because value is breaking lower and vice versa. So there's some additional risk because value stocks became momentum stocks. In the short run, that's set. As long as they hold a long term trend, then the sky's the limit. There's so much head. But by the way, um there's an e t F called m t U M, which is the ires momentum. It's

the biggest momentum ETF in the world. Really, it only rebounces once every six months. And it went from all these tech and growthy sectors into financials and sort of more defensive areas. On May thirty one, literally the day later, the whole thing reversed. It was like it might be the worst rebalance in history. Although if Gina's prophecy turns out, it'll all work out. But that's the thing about rebalances that every six you know, summer quarterly, summer monthly somewhere,

but as semi annual, you're locked into those stocks. And you're right, momentum and value are kind of tied together for a while, right yeah, And and that's going to create that could create some turmoil short term, but it also could create a much longer term tailwind that everybody's ignoring, right momentum typically is a pretty good strategy. It just breaks every now and then. But longer term, if you're in if you're in the momentum stocks, you're generally outperforming.

We've been it's been a long time since we've been in a market where momentum and value together worked as well. But if you look over the long term history, those are the magic. That's sort of the magic sauce, if you will, is to have some momentum and value exposure in your portfolio usually outperforms a broader market and momentum. When the academics and the practitioners do it, they usually don't use the last month, Yes, and it's for this

reason because there's these noise and head fakes. Right, So again though we're now beyond a month, though, so we are getting into a point where it's possible he starts to show up. It does I you know, I think that it's it's a tricky market. Also because the delta variant has played a part of this. Right. We talk a lot about inflation expectations, but the fact that we saw infections rising around the world again did create a

flight back into defensive strategies. But when you see things like the big famig stocks, the biggest stocks in the SMP five, all tech centrics still commanding an extraordinary premium over the rest of the index. When you see the US still expanding, commanding a premium of the rest of the world, even though earnings are not going to grow faster than the rest of the world over the next twelve months, you know that there's some imbalance, and ultimately

these in balances reconcile themselves. Um. I think right now, you've gotta You're just at a point in time where very consistently, when infections are rising, US stocks outperform, and when infections are following, US stocks underperform. You gotta get to a point where infections peak again. It's so simplistic, but it just works, and people move defensively as infections are rising, and as soon as they peak, they start

to move offensively again. And I just think that's played a huge part of the last month, probably six weeks, maybe even eight weeks, where folks get worried about this delta variant and they play that strategy. But it's very short term. I mean, longer term, I think many of us feel pretty optimistic that ultimately we're gonna get vaccinated. We're going to figure this out and things are going to change. At the same time, you cannot ignore the

fact that policymakers are completely on your side. You know, there's just it kind of blows my mind, frankly, that we're this far into recovery and the FEED is still operating a crisis era monetary policy. We're still talking about spending more money out of fiscal policy, despite the fact that we're at all time high share of GDP in fiscal spending. Now, you know, I could go into my Boomarati theory right now, but why don't you ask about the FED? Bomerti is so tempting, But I mean, listen

to that. We're just gonna put it on a show. I'm trying to make this a thing. Yeah, we're gonna come right back to it. Okay. So, so the FED Chairman j Pal going to be probably uh at the FED a little bit longer, although you know, maybe maybe jury is still out just a little bit longer on that, But that will be a topic of conversation in the

coming weeks. What do we expect um from the FED and and like there will be some shake up, like not everybody in in the FED will be in the same places when they get done playing musical chairs, right, So so what can we expect. I mean, obviously, as you just said, we've had a really devish run. Is there any reason to believe that turns hawkish really quickly with inflation on the rise? No, you know, I think

that the FETE has made it really clear. They've they've started to move the needle on what will make them change policy as well, and they've started to basically guide the market to say, look, we're willing to tolerate much faster inflation than we have in the past. We want to resolve social inequities. This is not language that we've typically heard from the FED, maybe even since the nineteen sixties. This has not been a huge portion of of monetary

policy making. We're gonna use average inflation prints. Um, you know, the standard inflation measures are inadequate. So this is a lot to all of this to me, says this FETE is going to remain easy to force the hand of inflation to be higher than it has been in a very long time. And the FETE is very supportive of inflation strategies. Now, will they ultimately have to catch up and probably create a slightly more painful environment for risk taking. Yes,

but is it going to be within the near term. No, because, especially if you think about what's going to happen next week, what's your immediate thing to say. If you're a Federal Reserve chairman that wants to air on the side of dubblishness, you talk about the delta variant threatening growth, and you talk about how we're you know, we're not a certain that things are going to be better, so we don't

need to worry about easing policy. Um. So I think that the excuse wagon can go on for a very long time, especially if inflation rates are peaking in the near term. As long as those inflation rates are coming down, there's just no reason for them to get two concerned and and they've told us they're not going to be so there's no reason to air on, you know, any

other way. Now. Personally, I think they should be tightening like crazy already, because I think that the economy is absolutely on fire and no one wants to acknowledge it. For whatever reason. It's very unpopular to do. Um. But they're not going to well what okay, so let me drop the theory on you, okay, because are you going? I am so okay? The U S stock market is the since we went to four one K plans, all of our money is now in this in the stock market.

That's we don't have pensions anymore. And so isn't there a theory that the FED can't let it go down? And then if you think who owns the U. S Stock market? I don't know, number I think of. It is owned by boomers. First of all, only percent of the country owned stocks. So by the FED pumping up stocks, you are leaving behind. That's a whole another story, that's the wealth gap. But by keeping that, yeah, and by keeping the fifty up, you certainly are allowing the retirement

funds of America to be cool. And since the boomers have almost all of that money, and the boomers are totally in power, whether it's Trump or Biden, they're both boomers, whether it's Pal, whether it's the people leading the big asset managers, and a lot of them go and work with each other, like one person will leave the FED and go work at black Rock and vice versa. Is there what about this theory that I called the boomarati?

Maybe there's a better word for it, that that class of people in power will never let the stock market go down. They can't. It's their retirement money. Well, Mike dropped. I stumped her. She never thought of it's that crazy the mic has made of tinfoil um. So I don't think that that it's possible to never let the stock market go down. Right, the stock market crash and three weeks last year it crashed more times in the last ten year. We had more corrections in the last ten

years than in any ten years in history. Well, when I say crash, I mean like a real, a real good one, a one that rips your face off, Like we had a fifty percent crash in two thousand eight, another fifty percent crash in two thousand, two thousands. These have we have actually been through over the last twenty years. The reality of the situations were not the FED was not really coddling the market in those two crashes. Oh, they definitely coddled the market all the way through because

we had Scott Um. I forget the increasingly coddled the market. I will agree with you there, but they've they've coddled the market all the way through. And yet the twenty. The past twenty years, we've been in a bull market, but it's been a very volatile and frankly, extremely difficult bowl market to make money, and because you've had these

very frequent and very vicious corrections in the equity market. Now, I think that the equity market historically goes through massive bull phases and massive bare phases, and we just happened to be in a massive bull phase. Is it all because of the FED? I don't necessarily believe that. And you know, I do think that there are financial centers of power, and you know, I would love to glom onto a generational sort of battle, but I'm not sure. I'm not I'm just I'm just not sure that you

know that there is anything people too much. The FED does get very sensitive. To be fair, though, the FED does get very sensitive to corrections in the equity market, and the fact that they respond as fast as they do, I would suggest that they do believe the equity market

has something to say about the economic outlook. Let's just leave it at that from me, Yeah, And we asked the Janis twenty manager who was managing that fun in two thousand when the Internet bubble burst and it went down fifty, as you said, and we asked him in our interview, you know, did did you ever did do you go through your mind that the FED would step in and help? And he goes, no, I never had that thought. Now it's if markets now five percent off,

it's all time highest. People like, where's the FED? So I also think the investor base is now a little spoiled. Well, it's also the market is very correlated to what happens in the FED. The market is obviously clearly you know, bought into the idea that the FED is a credible driver of stock prices to some degree at least. I mean, every time they've tried to normalize the balance sheet, it's created turmoil for stocks. In both two thousand and eight and in as soon as the FEDS stepped in with

massive intervention, it created a new upswing. So it's very relevant for sure. One of the things that you tell me sometimes, and I also see people talk about on twitters who's leading? Who is the bond market leading the stock market or is the stock market leading the bond market? Um, I think a lot of the bond world is a mystery to most regular people too. I think stocks are more. I don't know in their face, but um, can you talk about that and where you think that stands right now? Um?

I do think the bond market generally leads the stock market. I mean, look, obviously, the cost capital is determined in large part by where interest rates are, so the bond market does matter. Where I think we lose the plot a little bit is in the long term perspective. So for the last twenty years, stocks prices and bond yields have been very positively correlated. So when bond yields rise, stock prices rise, and vice versa. The twenty years prior

to that, it was the opposite scenario. What's the big difference there? For the last twenty years, we've been contending with deflation disinflation. For the twenty years prior to that, the general psychology was we are inflation is a bad thing, right that that psychological shift or real economic shift even

created a very different relationship between stocks and bonds. And I think you want to keep your eye on this very carefully going forward, because in my view, we could be at a critical turning point where at some point rising bond dealds is no longer a good thing for stocks. It's not any time soon. Right now, we still need bonding.

We can still tolerate much higher bond dealds from where we are, and the bond market will likely lead the stock market because higher bond deilds is great, It indicates an improving economic outlook, improving sentiment toward risk. Lower bond deals is generally not so good. Generally leads to worsening economic conditions, and the bond market is usually pretty keen to forecast is correctly love that. Uh, as long as

we're talking about relationships, are there any other ones? This is what I'm talking about, like going big with Gina. Are there any other relationships like that that you you think a student investors should be watching going forward? There are quite a few. Actually. Um, that's the That's the big overwhelming secular relationship that I think is absolutely most

important to keep your eye on. Uh. The other thing that I think you want to keep your eye on really carefully as inflation expectations, because I think we've gotten accustomed to this notion that, um, any burst in inflation expectations are very short lived, kind of like the value story, any burst in value of performance has got to be shortlived because it hasn't happened, and they have not endured

over time. But we've gotten a number of new inflation prints over the course of the last six weeks, six six to eight weeks that have suggested that this inflation

may endure. We're starting to see signs in wages that suggests the inflation um conditions may endure, and a wage price spiral starts with consumers saying I think inflation is going to be higher for a longer period of time, going to their employer and demanding higher wages, and then you get a spiral, right, and then inflation stays stronger, and it just reads to me, the economic landscape reads to me right now that we may be at that turning point. So I think you want to watch inflation

and expectations really, really carefully. In the short run, everything is going to revolve around peak growth. We've got peak growth and inflation. In short term, peak growth and inflation, peak I s M surveys, peak earnings growth. It just peak everything this summer, and the sequence of momentum in in growth does matter for investment outcomes. I think it's the underappreciated story of what happened in the last six weeks, we've got peak everything. Where do we go from here?

We've got to absorb the idea that we're no longer going to see that persistent upward momentum in every indicator that we follow. So that's another thing that I'm watching, um um. And back to the bond thing, which is the connection there. When you talked to earlier about yields and stock prices, I want to just invert that and say that what you were saying is that bonds and stocks moved together lately. Yeah. Right, So if you have a sixty forty portfolio, which a lot of people do, Um,

what are you supposed to do with that? Well, it's more they both go down together. Well, the yield rises when stock prices rise, so bonds sell off when stock prices are rising. So that's typically right, that's what's happening now. Yes, over the past ten years, they they sometimes will start to move in tandem. Everybody just sells everything. That's what happened in March and crashes. What often happens is the bond market actually just absolutely rallies to the end of

the earth and the stock market crashes. Um. You know, the portfolio and part has worked as well as it has because of this relationships occurred over the last twenty years. There are a lot of people, you know, you talk about broader diversification, there are a lot of people really struggling with if I move into an environment in which stocks and bonds are no longer correlated to degree that they have been in the past, and inflation is a

very different concern, how do I structure my portfolio. I think this is one of the reasons, one of the other underappreciated reasons why people are pushing into crypto. It's an alternative asset. People are taking from their bond allocation and putting it into alternatives of any description, crypto being part of them, but private markets being the biggest chunk where they're saying, look, I can't tolerate an environment where the bond market in the stock market aren't correlated consistently

over time in my portfolio. What do I do in

that scenario? And it's one of the most critical questions for a longer term asset owner allocator In my mind, I have one that just is a little off topic, but it's I'm related, it's on topic, but I've been doing a lot of research into Jack Bogel, the Vanguard founder, for a book project, and in many of his books he talks about where returns come from for stocks um and I think it's a great way to sell an index fund, because if you buy an index fund, you're

sort of buying the internal rate rate of return of the whole Enchilada. It's not as average or basic as it seems. You're actually writing capitalism's coattails. What do you get? He says, there's two things, earnings, growth and dividends. That's really it. I mean, that's what you get in return. Then there's this third element that's a little bit of a devil, which is speculative return. That is where pees go up really high, and that's where people lose their

minds behaviorally. And I just was in his book and when I interviewed him last about five years ago, he said, according to my calculations, those two things earning growths and dividend dividends, we're only going to get four to six percent from the stock market over the next decade. Well it's been like triple that. So are we on living on borrowed time? Is there too much speculative return? I mean, how much do we have to give give back at

some point to be back on that math. Yeah, So I think that there's a lot there's a lot of nuance around this, right, because it's really free cash flow. It's really cash flow that you're talking about, because cash flow drives both the earnings growth in the dividend. If the company is acceller, is it creating positive long term cash flow. That's what's going to drive the both of those factors and drive the price. And cash flows have been relatively low, but you get an artificial inflation in

earnings growth even if cash flow is low. If interest rates are low and tax rates are low, and that's the environment that has cultivated a much stronger stock market return. In my mind, then you would have had just given if you were just looking at cash flow growth. You also, as a result of the fact that you have those low interest rates, you've had an inordinate period of time where buy backs have dominated, and buy backs change the

EPs calculation, so you don't have core earnings. But if you look at EPs that the company looks quite different because your share account is being reduced. So there are a lot of there are a lot of nuances around this. I do think ultimately that you derive the value of a share price via the cash flows of the company.

I totally agree with that, but I think you do need to discount those cash flows at a certain interest rate in order to get the the actual value um And I also think you want to pay attention though, because if we go into an environment where interest rates are rising over on trend and taxes are also increasing on trend, it creates a very different scenario for bottom line earnings then we've had in a long period of time. But maybe we can have faster cash flows to make

up for that, right, I guess that's the question. And that's also where you know the idea that inflation lifts rates, which would then you have some of these high flying stocks would sell off a little bit. Yes, why ARCS tends to be pretty correlated to rates. Lately, ARC has been like I don't know, it's like you've got the spy than the cues and ARCS really out there in terms of being into some of the reverly growthy names.

And then so there's a lot of people are looking at ARC as sort of a being sensitive to to rates because they buy a lot of those stocks that might not have the cash flow well, and they look like they don't have the cash flow necessarily, but they also, in an environment where growth is perilously low, look amazingly strong. Right.

If if you can sort of think about the theory of innovative companies, as these are the fastest growing companies in the world in an environment where there is no growth, they look amazing. Well, what happens in an environment where

growth is much stronger and more distributed across industries. Suddenly maybe that doesn't have quite the panache that it had in the past, Right, And I think that that's part of the part of the thesis that we have is when you're an environment where there is no growth to be had, Sure, a lot of these companies look amazing because the growth is all concentrated in their in their names,

and they have all the potential of the future. But if the future starts to look a lot brighter and a lot of other industries start to participate in that future, which has been sort of boxed out of the growth environment for so long, all of a sudden, your investment opportunities at bronze and you can think about buying an industrial company, You can think about buying a consumer company.

God forbid, you might even you know something else beyond tech. Um. I do think they're going to come out with like an E t F like stuff you need E t F. Like they're going to start to relabel staples and to catch your things stuf as T Yeah, I know you want. That's for the big one. One of the questions I have for you and the way you talk about growth and they and the economy and you and I discussed this a lot, which is being bullish, being optimistic. You're

generally gonna get wealthier. That's said as an analyst who's looking for readership and to make noise. It's tempting to be the bear, to be the top caller, to be the big, short, cool guy. Right. You obviously don't do that. You tend to generally look at the bright side. You find things in the data and if you're following you,

you've made more money than the person. Because we we know there are some who are constantly looking at what's going to go wrong, and it looks good, it looks sophisticated, looks like you're caring about the about everything. Um, and there's no opportunity costs. No one ever goes back to the bears and says, oh, you were wrong. I went yeah, whereas the bulls, God forbid, the market goes down there, Like Gina, you said, it was okay. So can you

talk about that idea of taking the optimistic road. It's very es right. I mean, it may be as a function of my age. I don't know, um, but I think it's I think it's due to just the popular psychology of the last twenty years, particularly in the equity market. Since the crash of two thousand, it has been very popular to look over your shoulder for that next crash. Anytime you can. You know, to the degree that you write an article or publish a thought peace on that

appeals to popular psychology, you're more popular. Unfortunately for me, I just don't care if I'm popular. I just want to be right. But you know that you could say the opposite was true in the nineteen nineties. I would imagine if you were writing articles of optimism, you were, you know, very popular. In the nineteen nineties. It was a very strong bull market condition where everybody had optimism

about the future of equities. It's just very different. It makes me feel great about the durability of the longer term bull market. You know, as long as it's very unpopular to be positive, it's probably the right call. Um. But in words, not everybody is so enthusiastic where you feel like, wait, everybody is losing their mind here in

a positive way, exactly exactly. As long as we're always looking over our shoulder for that next big risk, then you probably have a much more rational market in general. Is it's very healthy to constantly be looking for risk? In general? It's it's tough to be an optimist in that crowd and get attention. Nonetheless, Nonetheless, it's it's been the right call, So I'll stick with that. Okay, I've got a final question, which is it's mid year review

season here at Bloomberg House. Is there anything that that um, Eric needs to work on? Oh my gosh, I don't think I can possibly air that. Eric's been great. Do you know I got one other one for you? And I think I've asked you before. Oh, no, favorite et F ticker? Oh, I don't know that I have one. But I really like M TOM because I'm a technician. So the only reason I like it is, yeah, um, the only reason I like it is is because I do believe the momentum is, over the long term, a

very very viable equity strategy. So I would just buy momentum if I had to buy any individual factors. Good Nobody ever said that's a good one. Yeah, yeah, sorry, that's not that exciting. Geena Martin Adams, thanks so much for joining us on Trillions. Thank you for having me, Thanks for listening to Trillions until next time. You can find us on the Bloomberg Terminal, Bloomberg dot com, Apple Podcast, Spotify, and wherever else you like to listen. We'd love to

hear from you. We're on Twitter, I'm at Joel Webber Show. He's at Eric Falcuna's. This episode of Trillions was produced by Magnus Hendrickson. Princesca Levi is the head of Bloomberg Podcast. Bye.