Showtime with Scarlet Fu

and you guys are a little more mainstream. You're the Tony Romo to your Jim Nance. Yeah, exactly. That works well. You know, Scarlets like a kindred spirit of mine though, because she's not full. She's not an E T F junk, you're like full E T F. Absolutely, she's like half E T. I've pulled both you guys in pretty hard, Like there's some things you guys will pop out and I'm like, yeah, she's given in a little bit. You're

three quarters nerds. I'd say at this point. You're not like me and Todd or or you know that gang, but you're you're getting there. Um. But you know what's interesting is the show is nearing its hundredth episode and congratulations, thank you. And there's a lot of crossover with this podcast, the show, and also my research. My main job is writing research, but those it's funny, like the guests on the show will say something and it will get my brain going and then I might use it here or

in the research. And there's just nice synergy between all of these activities. UM and E t F i Q I think is a big part of it. And I think, um, it's different than this show because like, if I say something really crazy right now, we can just tell Magnus to edit it out. But on TV and there's no Yeah, they're a live Yeah. If you drop like an you know, an S bomb or something, it's so it's that's it.

So in the spirit of that, we're gonna have Scarlett come on today and actually talk about some of the learnings that she's had about E t F S and also some highlights from the show. Yeah, I mean, Scarlett is so good at broadcast. I can tell you from somebody who's not in the broadcasting world, and neither of us are, but she is and it's a lot harder than it looks, but most broadcasters like Scarlett make it look easy the good ones, and so it has been

a pleasure working with her. She's been very generous to just even let me hang around and be on the show every week. And we thought we'd go over some highlights of the first sort of one episodes that that stuck out to both of us. I get to watch it from time to time, but I've never actually asked you guys to to populate your favorite segments. I'm really looking forward to this one, and as we get into some of these clips, just know that from all different segments.

But the way the show is kind of designed is starts with like a look at the flows, and then the A block. The first one is a guest who's sort of like how to play something. Bloomberg News is on there, so a lot of the guests we've had on are also on that show. Um. Then we have Passive Aggressive, which is where we look at the shots fired and the active and passive battle. And then the last segment is called the drill down, where we take

one e TF throw it on the lab. I give my take, and then the issuers on there to sort of defend and get into, you know, the E t F and Y it's valuable little et dissection. This time on Trillions Showtime with Scarlet Food. Scarlett, Welcome to Trilliance. Thanks. I've been looking forward to this because I always hear about trillions from Eric on Mondays we have our conference call for E t F i Q, and he's always making references to trillions. So now I get to be

a part of it. For the record, I'm still waiting for my invite to E t F i Q, but you know I won't hold that against either of you. Well, now that we've done this, I think that's the next No,

don't don't. Let's let's keep it this way right. So, so, Scarlett, how did you discover the E t F Because you've been at Bloomberg longer than I've been at Bloomberg, I think, And how did this come to be that you got an interest in E t S. Well, I'd like to use a number of different functions to track what's going on in the stock market, and one of them is most us for and it looks at the most actively traded securities by value on any given day. And if

you don't screen out anything. If you don't filter out anything, a bunch of E t F s are always at the top, and you know, um, around the financial crisis, it would be the same ones, the ones that bet against the finance chols and double inverse against the financials. And it was always kind of fascinating to me that there were these e t F s and that they were so heavily traded, and I was convinced that someone

was losing a ton of money. I'm sure they were. Um. So I always had this idea that there's a lot more going on in the E t F world than we discussed, and every once a while we talked about it, but most of the focus was on individual companies, and at some point it seemed like we're missing the boat if we didn't talk about E t F and we only fixated on one or two companies. And how do you discover Eric? How did I discover Eric? That's a

really good question. Um. At some point I think I gave him a call to find out how some E t F worked, and then he very he started talking. But that's just like, oh, let me tell you about myself, Jesus Christ. Yeah, Um, yeah, I remember I don't remember the first time we met or what happened, but I

think I remember going on with you and Alex. You guys used to host a show in the afternoon or Yeah, Alex Steele and Um you were you guys were both pretty into it, like you would ask me back, because unless you're covering a company, it's very difficult to get asked on Bloomberg TV unless you're fed person or a company person. If you cover funds, it just doesn't come

into their mindset often. So I was, you know, kind of the squeaky wheel, and some were more receptive than others to having somebody come on talk E T S. I think when E T S had, like um, when there was a real problem in the market, I think sometimes that's when you could really see because I would come over the trading volume, and I think going over, like you said, the trading volume started to sink into people that while these things trade more than Microsoft, you know,

we really should incorporate them. So I I think I kind of maybe sold you a little bit. You were very nice to ask me back. Uh, you know, I think even said come back weekly at one point exactly what you said. So you start having an Eric on what what did you What did you learn about E T s um that it's a huge, vast world and there are a lot of crazy acronyms, and people say it in a way that you don't expect. So when

did that become normal for you? Because there's the thing about the E T F thing that I felt like was like all these things I didn't understand and didn't know, and then all of a sudden it was like, oh, maybe on the other side and I know more than I thought I knew. Yeah, when when the acronyms start making sense to you and when you can reel them off? And you know, Eric has his three amigos right a spy voo and it was the last one. Oh, let's test your nerd them here spy voo And god, what

is the last one? I can't remebv i vv Yeah, it's the three spfs. There's only three. I knew you you were deeper, more deeper in than you thought. The other the other day when she goes it was some kind of a I think it was the price competitive, the price ters ETF. She goes, this is a lot like mote, and I'm like, you know, that's dropping it, Yeah, dropping the knowledge. And also what's really amazing about Scarlett is especially in the B block, which is called passive aggressive.

I came up with that name. By the way. It's so perfect, I know, uh, And it's so perfect about passive people coming on and you know they are there's an aggressive undertone, but everything sticks to her brain, even minute things, and she'll just figure out a way to put it into this perfect sentence that comes right back out and it's an amazing thing to watch. Decades of

TV training at work. Okay, so let's go through a few of the different moments that you guys have had on E t F, I Q and and contextualize them so that there are some takeaways. So the first one you picked, um, we picked up about four or five. So you picked Ed Lopez talking about E s p O, which is the E sports to E t F. Why'd you pick this? Well, because thematic etms are fun and they're what makes sense to people. It's hard to explain a multi factor E t F to someone who doesn't

know what E t F s are. But if you tell someone, hey, there's an there's an E t F of that trades like a stock and it's made up of all these companies that engage in or the business of e sports and video games. People can get their head around that. It's like, oh, it's a mutual fun but it trades like a stock. Okay, that's interesting. The thing with this, of course, is that you know, as a parent of two boys and eric, you can relate. You know, you see how much time your kids spent

on video games. So you're thinking, there's definitely huge business prospects here. If you can isolate this segment of the market and just make it its own product, this thing will take off. You know. I think we're going towards the interactive media or this idea of a metaverse where

people get their social entertainment and entertainment in general. There might be perception problem, but a lot of the advisors that we have talked to they have clients that have kids, and they have kids themselves that are playing video games, and so they really that the idea really resonates with them. And also interesting on this one is a recurring theme, which is trying to figure out when a product should work and doesn't and and vice versa. So that's where

that came from. Because the video game ETF has just been an incredible warmer, but the assets haven't followed. Like with robotics and cybersecurity, the performances there and the numbers are massive. I mean I looked this up before I came on because I spent a lot of time prepping everything so that I don't sound dumb or look dumb on TV around podcasts. The video game industry was worth one thirty seven point nine billion dollars. The global film

industry is worth a hundred thirty six billion dollars. So video games is bigger business than global Hollywood. But we don't treat it that way, we don't talk about it that way. This is serious money. This is a serious business, and yeah, it deserves And the biggest complaint I've heard on Twitter from tweeting up questions of why is the most advisors say I just can't have something with video game in it on a client statement. That's why we

have to add that they're embarrassed about it. Yeah, career risk. Career risk of advisors, as you can tell, drives a lot of our contentment um speaking of esoteric and kind of unique theme products. The next I picked this one, which was John Bogel. We had yeah, rest in peace. Um we at him on and he obviously talks a lot about passive when he had when we had him on.

But I picked a clip here where he kind of talks about some of these wacky theme ETFs and it's fascinating he knows these things are launching, like these are some really tiny products, and he was aware of this. This was maybe a year ago. And when you get into e t S and their rapid growth, it's become kind of a well, certainly become a marketing business where new ideas. You've seen the new funds that are coming out. We now have one that is, let's see short retail

and long electronic marketing. Yeah, that's talk about the time of the product of the times. And we've got the Republican and the Democratic, a t S, drinkers, e t F, the distillers, and where it ends nobody knows. I love that he dropped the drinkers and distillers. That's the whiskey E t F. The fact that Bogel even knows that exists is fascinating because he is a legend and he's that that saw so interesting insight into just how closely watched watched it right. He had never lost a step

every time we interviewed him. He was acute as ever, sharp whenever we talked to him. And of course he invented the index one. He wasn't a fan of e TF so the fact that he knows all these obscure e t fs, including Whiskey, which ended up folding right, I mean it shut down later on, is pretty amazing.

My only regret about that interview is that we had all these technical difficulties and you know, Jack Bogel sitting in some room in Vanguard in Malvern, Pennsylvania, and the audio and kept cutting out, So we started the conversation that we had to stop it. We had to go to commercial break, we had to come back, and we started the conversation again, and then he disappeared again. It was a little bit of a technical snaffo. This was our third show or something, and I've been done segments,

but I've never dealt with something like this live. And I remember you we had to do something, so you just started asking me about the Democrat Republican ETF and we just shot the breeze on this for about three or four minutes, just because something had to get filled and he came back. Then we put Kathy Wood somewhere in there. The whole show was a bit disjointed, but Tim uh Andreacchi fixed it in post work. I think

it looked pretty natural when you saw it later. Yeah, the whole thing with live TV is that you kind of have to tap dance until someone tells you what to do, and the people who tell you what to do in the control room and they're trying to fix everything and they're talking to the directors, and until then you just keep talking. What's the secret to tap dance? You have to have a good co pilot. So you know, Eric and me up on the set, that was not

a problem. We could talk about something anything for hours, as long as you just keep going. He used to tell me the same thing. I sent some hostility, Okay. Next next I picked was Kathy would Um. We had her on the podcast recently. She is probably the guest we've had on the most. Yeah, how many appearances Remember on SNL when Tom Hanks was on and he he

called the five timer Club. Alex Baldwin was on more though, I think, Yeah, this was back in the nineties, that before Alec Baldman at all the show in our age. So I think she might be a four timer, like she's been on a lot. And the reason is because she's she knows how to say things that she's just good on TV and provocative and provocative, and her product is is a is a hit. You know that helps, but um, you know, to me, she's embodies what you want out of a guest. I picked a clip of

her calling Amazon deep value. We believe if you look at our portfolio and you do a correct analysis a long term time horizon discounted cash flows, that we actually are a deep value portfolio. I know that sounds crazy, but given the opportunities and these innovation platforms and the kind of growth they're going to generate during the next fifteen years, we think that market does is not pricing

our stocks even now efficiently. You know, I shouldn't have just said I shows that what that's kind of your version of that, Like usually I subdued that. I can do the mapping, and you definitely react did more than you did on that. I mean, anybody would have. She called Amazon at deep valley stock, which I don't think I've ever heard anyone to. I mean but he speaks to I think Kathy, who can make really bold things

and then sort of back it up with her performance. Well, the interesting thing about Kathy is that, and Eric and I were talking about this earlier, she's a bull. She's an unabashed bull. But it's hard to be a bull, and it's hard to sound smart when you're a bull. All the bears sound really smart, right, because you're poking in people's arguments. But if you're making the case and you're speaking with conviction and you're enthusiastic and optimistic, you get invited back to et f I Q that if

you're articulate. But also it's easy for people to to say to be to say you don't know what you're talking about, like that doesn't make sense, that doesn't make sense, and like tear you apart. In markets, if you know the market is going to go down eventually, and it's a tire wind for the naysayers, and it's a weak place to go in my opinion, and no one ever comes back and says, hey, you said the market was going to go down, and it's now five years later

it's up a hundred percent. My opportunity costs for listening to you is a lot. Nobody ever rates that article and hits the naysayers over the head with that. I don't know why Opportunity Costs is left it, but I agree with you it's harder to be a Kathy. What other thing about Cathy that's interesting to me is and

we talked about this a lot. If the person is at the top of the food chain of the company, whether that's a one person shop or bogel at like you know, thousands of employees, they're the best guests because they do not have anyone to answer to. It's the mid level they come in. You can see the lawyers in their head as they're answering a question. Now you can see the pr people on this side. They're literally

on the side. So that's what makes Cathy also good is that she's running the shop there and is very much looser with what she's saying. You can say whatever she wants. No one's gonna stop her. Next up, we have this is a good one. Remember x I V. We've talked about. We had the maker of x I V, Nick Turney, on the show two weeks before x I V imploded, And I'm proud to say we handled it with a lot of caution. We we use it in

the drill down, we talked, we showed the drawdowns. And then here's Nick answering Scarlett's question about, you know, how safe is this product so it holds up? It does? I mean, I wouldn't have if I'll be the judge of that, Nick, how dangerous is this et F going to be when the VIX spikes and stays high? Yeah, I mean obviously, selling volatility, as Eric mentioned, is designed for trading um. It's it's certainly not a buy and

hold strategy. If you want to look back in history, you can really the last real volatility event we had was two thousand eleven UM, and since then it's been pretty unexciting in the ball markets. Uh. In two thousand eleven, shorting Vic's futures with a daily reset you would have been down about but even if you bought at the peak just before that, you're up about seven despite that

draw down. So UM, there's very significant drawn risks in in shorting volatility, But as Eric mentioned, there's quite a significant premium that comes from rolling those futures and being willing to sell that. Two weeks later, the Eagles win the super Bowl and x I V goes away that you were out of work that day. I did. I took the Monday off after the super Bowl because I was gonna. I was up till four in the morning and I wanted to watch all the sports shows to

just relish and wop. And something happened. Yeah. I started to get a call from I think Luke Kawa emailed me to see if I could come, and I was like, what's going on? And then the whole rest of the week was like all hands on deck. I did get a lot of TV asks that week, because that's the good news about some of those emplosions, you know, high you know, I mean x I V did exactly what it said it was gonna do. It had the termination event written in there. You know, just because something goes

down doesn't mean it's bad. I think sometimes people associate that. That That said, and E t F is so easy to access. You just hit by and then now all of a sudden you own this highly complex, complex strategy. That is why X I V is why we came up with the rating system. So we think X I V s are okay, they just need to be rated R. Then then everybody can kind of feel for what they're getting into. But that's part of the argument. There is X, I V the E t F that your dad bought. No,

that was t VX that that's product. Also that bets on. Did your dad of a t VIX tattoo? Yet? No? I mean, poor poor t VIX has the opposite problem. On that day it did great, probably up six or something, um, But every other day it just bleeds money quickly. And dad had one of those. Yeah, he bought and hold it like an idiot, and I told him not to. Yeah, very clearly, Nick Turney said, this is not a buy and hold investment. UM. Next up is John Davy, who is a We've had him on a couple of times now.

He's the perfect A block guest. He's what they call an E t F strategist advisors and EF strategist invest in ETFs. So we have these issues on all the time, and of course they're just pitching and pitching and pitching. He comes in and all he does is pick ETF. So he he goes through he's like a you know, you ever go to the video store, editors employees picks these strategies will come on with products that are way beyond SPY and i WM, And that's why we like

having them. So they can talk macro about like oh the fed and then they can work in the products stuff at the same time. He he and other strategies are the only ones who can like spit out names of E t F and acronyms the way that you can. Others may not be able to do that. They can do it for their own E t F s, but you know, if you bring up other ones, they might

scratch your heads a little bit. Also, John Davy, by the way, told me his cousin is Robert Davy, who was one of the foretelling brothers in the Goonies movie. So yeah, which one not the other guys? Wow? Yeah, that was See this is some of the conversation you have before the show starts, when the guest sits down. Can you can we figure out a way to do a Goonies episode about et s? I mean it's got we got data rules. Yeah, yeah, totally. There's a little

organ in filmed on the Oregan Coast. I can come up with this. We can do this. Yeah, that's what that movie was. There's an anniversary figured out. Oh yeah, it's Oregan. Yeah, that's where I'm from. Oh, I love that movie. I watched it to say, I watched it maybe three times at the movie theater. It holds up. All right. Let's let's hear the clip from John. So, I think you know inflation, you know, on the margin is rising. This is a coal that we had earlier

in the year. And if you look at the New York Fed inflation gas, you know it's been taken up and so so calmed by is basically a third towards energy, a third towards precious metals, and a third towards agriculture. Um. So right now, commodities, Um, you know there's uh, we're in a period where there's we're in backguidation. So that's positive roll yal, It's a couple that would historically commandis

have had positive skewness. So you know, if there's a bad corn season, you know, corn kind of explodes to they upside. So different from equities which have like, you know, negative skewness. Um. So you know, we think that they're a play on inflation. They're very uncorrelated to equities. Um. Certainly you know against bonds. So I think you know, they work well in a multi asset portfolio. And when you heard him say calm B, he's not saying calm B, He's saying c O M B as a ticker. See

that's where he nerded out. I was I was impressed there. I was like, whoa, I actually call it comb because it's spelled c M course you do. Yeah, See that can be confusing that call it different things. So she's right. I think it's a it's a lesson that you should dwell on a little bit of like, you know, you're you're speaking in a language that the rest of the world doesn't always understand. This is why both of you are good to mix it to balance it out. Absolutely.

I mean, you know, I definitely on the highway we were talking about how ETF strategies like John are the perfect a block GAFT because they kind of set the scene and they can talk about what's going on and you have to unravel it and then you have to unravel it. But it's also a challenge to get these guys on a lot of the times. Eric can attest to this because the f O m C, the Federal Reserve meets on Wednesdays every six weeks and our show airs on Wednesdays as well. Our show is at one pm.

The f o MC announcement is at two pm. So we have to avoid talking about the FED and what it's going to do every six weeks on our show. And how do you avoid talking about the FED that the central influence on I'm not talking about God. I ship a weekly magazine Business Week every Wednesday. After not knowing, Yeah, I know, I know the pain that you speak of. Um.

Also this comes into play with the charting. So like when John speaks, I get tickers he's going to cover and I put you know, John's top five ETFs and calm By is right up there to help people understand and sort of map out what he's saying. That's the elements are a crucial part, and that's some painful to make, but it really helps. I think Eric is on top of all of that. He's like spitting out acronyms left

and right, and Tim is trying to keep up with him. Yeah. Well, I usually try to pick a chart or two that is going to wow the insiders, like a Nature Racey or a Todd Rosenbluth, something that just would be like even amazing to an analyst. Our goal is to get Todd to live. This is really I've I've learned to like it. We notice when he doesn't, Yeah, it feels a little little emptier. Where our fan Todd's been a great guest on the untrillion. He's he is so he

makes it fun. I gotta say he's very animated and and very good about it. But like and then some other charts are just give me something that's simple that somebody who's I don't know in Florida and retired can just like not be completely lost with. Okay, Next up is that we have the Assula's. This was really I think sometimes all kid with Scarlett and saying you do you went Mike Wallace on them where she goes like

sixty minutes. This was We had these people who track four or three B plans which teachers use, and we I think we were first nobody's had them on TV or and then Barons were in an article a couple of weeks later about this topic, which is blowing the lid off of how teachers are getting screwed over by these annuities. Why would you have a four oh one K plan and a four oh three B plan with

completely different rules. It makes no sense. The principle is to accumulate wealth for your retirement, correct, So how can you how how could you accumulate wealth if you're paying three or four percent in fees? It's virtually impossible after inflation. This is a common theme on the show, but this was an extreme case. I mean, it's funny sometimes we'll talk about flows going to a fund because it's two basis points cheaper. Now he's he's talking about three hundred

basis points and you forget that. The advisor world is definitely tuned into those bibs, but most regular people, a lot of them are definitely forget it, and they and they don't realize it absolutely, And that's why this thing is probably in the second or third inning only in my opinion. And he was in a unique situation because he was a former teacher. Before he was a teacher, he traded FX, so he clearly understood how markets worked,

he understood how fees worked. Then he went to become a teacher and he was looking at all these four or three B plans and thinking this is insane. I can't believe that they're trying to sell this to us, and there's what six two seventy vendors come ing to teachers and saying, my mind, my mind, my mind, and no one knows how to do it. So teachers would ask him and he took a closer look at it, and he was saying, this is this is crazy, this

is highway robbery. Were the perfect victim, and it was finds me those commercials you see, how would you like to make ten percent a year with no downside risk? And that those those are how those are pitched? This was this one was just interesting and to so many people, because a lot of a lot of my colleagues came up to me afterwards and said their spouses a teacher, and you know they would they would come home with these four or three B plans and not be able

to make sense of it. And you know, we finally laid it all out there. Why it's wrong, Why everything that goes into it is is flawed. Okay, next up, Scarlet, you picked this one. This is Jamie Catherwood. He is a millennial. He's very active on Finn twit Um. He's a financial historian by passion. He worked i think at Gallagher at the time. He's now at O'Shaughnessy Asset Management. He actually got his job at O'Shaughnessy because he was active on Twitter and hooked up with Jim O'Shaughnessy. I

think he found an opening. People are so caught up between eighty seven and today. Yeah, he tracked stuff that happened in like seven and figures out ways they are relevant today and no one was doing that, and it seems fresh and original, And he's kind of carved a Niche shot as the historian guy. What do you have to say. He's talking about passive investing in how it goes all the way back, the roots of it go all the way back to medieval Italy. And Jamie, what

about liquidity? In your essay you mentioned there was an iron chest with three different locks, so liquidity was an issue back then. Yeah. So for this unity to create Strength fund, once you bought shares of the mutual fund, those could be freely traded on a secondary market to other investors, So that was liquid. But the underlying securities, the actual bonds that the fund was invested in, those were held safe in an iron chest with three separate locks.

So if ever an active decision was to be taken three separate commissioners would have to come together agree on the you know, cell decision and unlock at the same time. So to me, rather than a quant fund, the fun represents an early kind of bond index fund because they're so little room to maneuver and make active decisions. Wow, that's awesome. It is you know, indexes every now and then change, but they do take that level of So that is just such a visual thing to think of

this three lock box. We're only going to get it out if we all three show up with our special gy. The amazing thing about all of that was no one called it a mutual fund. I mean, he referred to as mutual hunt because he said it's like a modern day mutual fund. But he went back in time and like went to some database and figured this all out and writes these long essays about it. And he also had the ancient roots of active investing as well, so he's got a whole series of this. I love the

tech involved to like going to the locksmith. So you're gonna make this thing, and you're gonna do it one way and then a different way in a different way, and the laxmith is like WHOA. I'm not gonna ask any questions. I'm just gonna do it. Also with Jamie Um, he what is I don't want to graduate from college? Maybe less than five years ago. He is easily the youngest guest that the show has ever had. And I mean just trying to have tomorrow stars on today. You know.

Um there's a show on MTV back in the day called dred and twenty Minutes and it was on that with Dave Kendall. It was on Sunday nights from like ten to twelve, and it's like maybe the late they play new wave music. They played um early alternative like the Cure Order all that kind of stuff, and then when grunge broke that became mainstream. So I kind of feel like the ETF industry definitely attracts younger people. A

lot of new hires go there. And I also think that, you know, the a lot of the people who are making these products is more assets come in, they'll they'll probably get more stature. So I feel like we are trying to catch them earlier. So we're gonna be a hundred twenty minutes. We're only thirty minutes. I know, we didn't we did another nine. Yeah, Tim is going to rip out his hair. He cares about this. Okay, Who's next?

Next is what we try to do once every six months, which is get big like a list guest, and um, Scarlett deserves all the credit here. Howard Marks. We got Howard Marks double two blocks, so he was like A and B and who's Howard? Just for people who don't know, he's a very well known investor, very well respected, very good track record, very very smart. Writes these really easy to understand investor newsletters that lays out what he's doing, why he's doing it, and he's a hedge fund manager

predominantly right. So and he's a billionaire I believe. Yeah, Well, I mean they all are, right, So we're talking about somebody who doesn't really need ETFs, but he wrote about them a couple of times, and he you know, had some issues with passive in general, called it called an autopilot. And then he's also talked about h y G liquidity, which has come up over and over um. But now Howard Mark says that it makes you know, the Financial Times Bloomberg people write about it attention. So we had

him on and we asked him about passive investing. Let's see what you have to say. They're good for investing. And I think that if if you and and they and most of them have low fees, which is a good thing, and if you want to invest in the kinds of things that the E t F UH invests in, then I think it's a good vehicle for you. Uh. The issue, Scarlett, in my opinion, the main issue is liquidity.

I think the people turned to e t f s and away from mutual funds because with a mutual fund you can only trade at the end of the day, uh and uh at the prices set at the end of the day. With an e t F you can trade any time. So it's easy to say, oh, it's more liquid, it's more flexible, I can do more things. Um. And that should be true. But on the other hand, as it should, so he brings up the the this this thing about e t f s being very liquid, and some of them track holdings that are don't trade

every day or less liquid. In this liquidity mismatch is a constant, recurring theme, and we've addressed it head on, and then we do this thing now because we can't get two people like on Fox news to just like argue. I'd love to do that. By the way, I don't think that that adds any value. I'm sorry you would anyway.

So because we can't get people on like together arguing, we'll take the clip of like Matt Tucker from Black Rock and play him talking about why you have nothing to worry about with HyG and get hit marks to react. Then when the next Black Rock persons on will play marksist clip. That's the best closest we can come to try to getting the debate in real time. Yeah, no, no, no no, I mean this is one of the limitations

of a thirty minute show. I mean, if you're going to have an argument or debate, that's going to take a good fifteen minutes, and there's half your show right there. Actually more than half because we have commercials as well. But yeah, this whole idea of liquidity everybody's favorite knock it is like, how many times have you talked? I think I figured that out like within the first sort of month of putting my head in the et F space. It's like with the knock oh liquidity and oh h

y G. I've heard this argument before. If you want to sound smart, just bring up liquidity and it's like literally like you can find yourself in a room full of et F nerds just be like you guys worried

about liquidity? You right now And it's logical. It's like you know, Wall Street evinced things that blow up all the time and I but time and time again, we've had these crazy, awful sell offs and the ETF does fine and starting to turn a little people, so say, actually, maybe the ad liquid We had Chrystom Money and Aaron Brown from a q R both came on and said, actually, at least you'll get a price in an ETF. You may not like it, but it's going to trade. And

so I think it's turning a little bit. I don't know. I don't I don't see it going away anytime suit either. I want to go back to what you're saying, which is how to sound smart in a group of nerds. Presidian, this is real. What's that non transparent active wrappers? Oh wow, what do you think of that? That is the biggest one up drop that in the room. And like Chrisidian, discuss what happened when you've done that? That will make you the hit of the cocktail party. I don't well,

I mean it's a little too nerdy. But because you want to warm up to that point, you gotta be careful with that because then the people flee from you. Yeah, they're a little bit like, wait, wait, why why are you saying this? Yeah, that's like like you can you can be like you know, fifteen minut it's into a conversation and then it's like, oh, well, I just did

myself a favorite into this conversation. Yeah, but I mean that one's another one that we we talked about quite a bit because Presidian is how Active is hoping to turn the tide, and um, that's obviously a huge debate point. So this stuff doesn't come up a lot on the rest of the network here and there. So Minus will dive into it. Get thirty minutes, so we'll go into

you know, how can Active make it? Because normally we have Active manager on Bloomberg Television, they're picking stocks, they're just talking about what they think of the fed in the market, and here we're gonna ask them like, what do you think of the prosidium? Are you going to use it? What do you think of ETF? You just added value to this this episode of True thank you,

thank you. All right. Next up we have West Gray, who is um a PhD out of Chicago, smart guy, ex military guy, but plane spoken, and his e t F q VAL is deep value. I mean he holds like like mall stocks. Right, we're talking p of like half the S and P and so we asked them how it's like to try to sell this to advisors. Well, it's scarce advisors because if if you look at the performance of say QVL last year, it got absolutely destroyed

by the SMP. So if I'm sitting here as advisor and I'm showing them this weird ticker called c VAL and how it owner performed index by whatever, I don't even know, ten twenty points, They're gonna be like, you're an idiot, You're fired. Right Where, it's much safer telling something that essentially closet index and has very low tracking er and it doesn't really ever deviate too much from the SMP. But I can still tell the story to my client, Oh, we own value. We're we're we're cool

like the other guys. But most people just realistically can't do or really I can't own c vouts. It's insane career suicide. Almost what he just said explains so much of the questions you have in flows and assets, like why would people buy a mutual fund that that basically gives it the SMP and it's very close to it's called closet indexing. That's why career risk of advisors is the answer to a lot of the questions where the

flows don't really seem natural. And not only was that a honest answer, most people would come and say, yeah, advisor should use Cuba. He's like, it's career suicide. Actually, I heard some people later go actually like that. I got interested in the product because he was so honest from Georgian opposite day, like just saying the opposite of what you should say. Um, so I actually think that might work for him. I liked it because his backstory

is fantastic. You said he was a former military guy who's in the Marine Corps, and we asked him about how he went from being in the military, or how does he have the intestinal fortitude to ride out the pain in years where c VOT does really badly and he keeps such a great answer. Being a marine is about being different and engaging in things that suck. If you can do that with a lot of discipline and outfight the enemy, you can win over the long term. Okay,

we got a kick, who's the last one? It's what? So at the end of every episode, we make these little videos that almost seemed like commercials, but we just make a one minute video called and this is your idea too, there's an e t F for that? Because I think a non e t F person is probably blown away time and time again, we're like, there's an

e t F for that. This was and this was from when Eric used to come on Alex Steele and My show and he would preface things by saying, and by the way, there's an e t F for blank blank blank. And it always kind of stuck in my head that they were always coming up with these ridiculous ETFs. You know, video games, which we've discussed is not crazy

at all and makes total sense. But you know, why not make this into an actual segment where you can say, wait, did you know there's an et F that tracks space companies even though there aren't any publicly traded companies that

dabble in space. Of all those videos, um, I have my favorites, but the one I picked was for the Global X Millennials e t F m I l N. And the reason I picked this one UM isn't because it's my favorite or anything, but because I asked UM someone in production to pull the download hits on all the videos, because every time we do a clipp it gets put on the Internet. Which ones have people like clicked on the most? And after all we just went

over all this hard hitting journalism. The Mike Wallace Moments the Millennial video is the most clicked on video the Global X Millennials. Thematic et F trades under the fitting ticker m i l N. The fund tracks US listed companies exposed to spending categories relevant to the millennial generation, those born between ninety and two thousand. The index is based on consumer spending data, consumer behavior, technology, and demographics. M i l N is weighted heavily in the Internet

and retail sectors. It includes names from Amazon, Into It, Facebook and Netflix, to Nike, Starbucks, and Home Depot. The fund has some eighteen million dollars in assets, cost fifty basis points and has returned almost since launching two years ago. It's outperformed the broader market by about five percentage points thanks to a big overweight in Netflix. M I l N gets a green light in the Bloomberg Intelligence traffic light system because what you see is what you get.

A long only basket weighted by market cap. I love the music and has three thousand clicks. Think, yeah, Scarlett has great voiceover abilities. Have you been approached for voiceovers? No? But I want that to be the thing I do after I retire. Yeah, I mean, like just sit back and like do voiceovers all day. I didn't Pixar movies or like anything. Yeah, call me. How about how about Eric just moves his mouth and then you can do voice over for that. By the way, did you like

the shout out to the Bloomberg Intelligence traffic lights? Did? I did? Eric, You've hit the big time. Scarlett's talking about your traffic light system on your own show. It's this is a good place for it. Though it's not crowbarted. I think it fits nicely there because usually we're covering some far outs. That's it's called product placement. You know.

Both of our kids come up with this one because the video because when this comes on the weekend occasionally will uh, my wife will watch it, and if my kids are around, they just they're bored, but sometimes the cartoon eight year old can can handle. He can actually, that was of Scarlett's voice. Yeah, well that's probably what it is. No, you know what it is. It's so funny.

Speaking of the Bloomberg Intelligence Traffic Lights System, My kids watch all the videos because I show it to them because you know, we're we're looking at them every Monday and Tuesday before the show airs on Wednesday, to make sure that the graphics are correct and everything. And they actually turned to me and they said, is there ever an et F that scores a red light in the Bloomerk Intelligence Traffic Light system because we only get the

ones that are green lights? And this is true. And I came back and we discussed how we can get some red light ones in. Yes, So the next week or the week after, we did fang D, which is triple leveraged. Uh, just the fing plus some of the stocks like Tesla, and it's it's inverse triple leverage inverse. It's this thing is hard read, I mean, so we went all out and just to prove that, hey, we do cover the red lights every once in a while. That was a cool one though. The red lights are

that's like the best ones. And by the way, shout out to the art design team when you see these that what they come up with is amazing. For the fang d they had this cobra and like Neon, it looked like there's stuck a club and add for a cool club. All week It's like, oh yeah, and now we get to do We did um and then we did another good one. I thought the video game one was amazing. That was the first one. And then VCR VCR and they did like an eighties looking kind of format.

We have a trip, We have a trip. Scarlett, thanks so much for joining us. Thank you, it was a lot of fun. Thanks for listening to Trillions until next time. We 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 Caltunist, and you can find Scarlet at Scarlet Food. Trillions is produced by

Magnus Hendrickson. Jessica Levy is the head of Bloomberg Podcast. Ye