Ragin’ Rates

and rates? And at what point does the equity market have to take serious notice? We discuss, and as always, we will close out the episode with our tradition the craziest thing we saw in markets this week? Uh, Sarah, another crazy week. I got a couple of good ones. I trust you do as well. I trust you have plenty good ones. Mike. Yeah. Um. And I'm excited this week.

I mean, I know I'm excited every week, but I'm especially excited this week for one thing, because You've managed to drum up a ridiculous amount of interest in my high school nickname among listeners. I did not expect the demand to be so robust. I think the joke is on you, Mike, though, because I think you're actually the

one who drummed up all this demand. I've just been going along for the ride, and here we are sitting knocking on the door of two hundred reviews, and that means that Mike's just gonna have to share his other other not as flattering high school nicknames soon. It backfired on me, It really did. I did not think. I did not think the demand would be that robust. But we're really up to one ninety seven now, so I

will not reveal the high value nickname. I might reveal a lesser valued nickname at the end of the show if you stick around. So there's that. But the other reason I'm excited, Sarah is this week's guest is a bona fide Philadelphian like myself, at least suburban Philadelphia, which means I may slip into my sort of Delaware Valley accent and talk about winter ice and stuff like everyone would love that. Everyone I know, at least our guest, Uh,

we'll understand what I'm talking about. And she is the chief investment strategist at P and C Financial Services Group, which manages the neighborhood of a hundred and fifty billion dollars. Her name is Amanda Gotti. Amanda, welcome to the show. Thank you so much for having me. I'm excited to be with you both today. Great and also I believe a loser if if my LinkedIn stalking is accurate. A Losern County native, or at least high school which is that?

Is that is really impressive? Yes, I'm a Dallas High school grad, Losern County. Yes, Harvey's Lake. You've swimming Harvey's Lake, I assume and uh oh absolutely, many many summers spend at Harvey's Lake, like you should never ever be ashamed of LinkedIn stalking. Yeah, it's what we do. It's what we do. It's what we do. I'm impressed. But my people came from Wolk Spara not too far away from there, and and many summers at Harvey's Lake too. I'd not

meet with them. But anyway, enough with all that, Amanda, I, as Sarah pointed out, the treasury market has really taken center stage this week. I guess, um, you know, it wasn't very surprising that we should see yields yields creep up the way they have. I think the rate of change is kind of what's alarming people how swiftly they've moved up. What is your thinking on that? You know, what are you telling clients about? This? Is it um you know to the moon? As they say on Reddit

for yields an hours? This is this just sort of an anomaly and should should this at least the rate of change in the increase settled down? Do you think? Well? I think there's a lot to unpack as it relates to what's happening with interest rates here. I think at the end of the day, this feels like about as high as we can see the ten year ago from a market driven perspective. Can talk a little bit about why that's the case. I think there's some issues at

the very short end of the curve. There's also some issues at the intermediate and longer end, and so when you combine those two things together, we're really seeing pretty dramatics deepening in the yield curve if I just take kind of the longer end as a starting point, So the tenure absolutely at the highest level of the pandemic um you know, really outsize moves more significant than even what we saw following the Georgia Senate runoffs and even

the Fiser efficacy um news around their vaccine back in November, and yet we really haven't had a lot of meaningful news, so fairly extreme moves here on basically this idea that we're going to get a ton of stimulus coming into the system and fast, and so, you know, I think this is the bond market's interpretation that that Congress is going to effectively pull off at one point nine trillion dollar stimulus package and then turn right around and do

another package, but infrastructure focused of the same magnitude or larger, just in a matter of a few months. And our take on this is that the bond market is obviously concerned about it, obviously fixated on it, but ultimately it's going to be very difficult to get all of this

done and rapid succession. I think it's pretty clear and well understood that the one point nine trillion can get done through budget reconciliation, not at all clear that we can get the same magnitude of stimulus done for infrastructure without raising taxes. And so I think that's going to be the key to the path forward in terms of the intermediate and longer end of the curve, I think

things are going to settle down a bit. We may not actually see rates fall back down meaningfully, but this rate of change has to slow down when you start to factor in UM increasing taxes. That's not going to be able to happen or turn on a dime US necessarily. The short end of the curve very different story, So much much more pressure on the downward side of the short end of the curve, and it's really a function

of treasury related accounting as I would describe it. UM. There's an adjustment there in terms of cash reserves as it relates to their funded status and as it relates to what they think is going to happen from a stimulus perspective, and so net net, they are creating some scarcity of supply there, and I think that that is

putting pretty significant pressure on short term rates. We've even seen REPO go into negative territory here again very recently, and so I think net net two very different forces applying a lot of pressure here on the yield curve, creating a lot of steepening UM. You know, the usual interpretation of steepening is that we're going to see this

massive acceleration and growth and potentially an inflationary spike. But I would say we need to slow our role here a little bit, just given kind of the forces that are at play, a little bit of a head fake, not necessarily expecting a full normalization, but I think that this is you know, very significant short term volatility that will start to slow down a bit over the weeks and months ahead, So so focusing on the longer end

of the curve. I mean, we heard from Jerome Powell this past week speaking to the Senate Banking Committee and which he said that you know what, essentially people shouldn't really worry about the backup and long and yield because it's a statement of competence and growth. And you mentioned that people kind of need to slow their role talking about this massive pickup and growth, possible worries about inflation

down the road. But what is the takeaway here and when you look at the data and the expectations for trillions of dollars of stimulus coming our way, what is the outlook for growth, what is the outlook for inflation? And therefore what does it actually mean for assets like bonds and equities. Well, again, there's a lot to unpack here in terms of the path forward, I mean, I think it's pretty clear that we are not out of the woods yet. In terms of the pandemic, you know,

case curves are definitely moving in the right direction. There is some progress on the vaccine front, but my goodness, things are moving a lot slower than I think all of us would like to see at this point, and so that really does pose some pretty significant challenges as it relates to the reopening and the path forward. You know, somewhere in the neighborhood of eight percent of US g d P is still in states that are under some

form of economic restriction or lockdown. So we got a long, strange trip ahead of us, right was a very long, strange trip in one is setting the stage very similarly long and strange trip to get to a reopening. And while we think in the short run things are likely to be a little bit choppy on the economic growth side of things, and also in terms of this market rally, as we moved towards the second half of the year, and certainly as a setup for two, a much more

bullish backdrop starts to come into focus. And so at the end of the day, it really comes back to the path forward very much being dictated by covid um and the pace or timing of getting this economy reopened, But certainly some fits and starts in the short run.

As to your question around inflation, you know, back following the financial crisis, there was a lot of concern sort of deja vu all over again, very reminiscent today of the concerns and fears back then following the financial crisis that we were going to see this big inflationary spike or inflationary accident, and ultimately none of that really did transpire. Now, I fully admit that we are in unprecedented territory as it relates to stimulus coming into the system, far and

away more today than what we saw back then. But we still think there are some structural forces in place that will keep a lid on inflation. So it isn't that we won't see some bouts of it here in the short run, certainly seeing it in terms of lumber prices,

healthcare costs, childcare a costs. There isn't certainly a short list um, but net net, we don't think that that's enough to cause any kind of long term damage to the economic recovery or frankly the market rally, and then longer term, when you think about the structural forces like demographics, which are clearly deflationary here in the US, um technological innovation which really has been disinflationary, deflationary how you want

to describe it throughout the pandemic, even before the pandemic took hold, and has really distinguished itself in terms of pulling away from the rest of the market pack. We think that technological innovation story is very much here to stay, and we'll also keep a lid on longer run um inflation measures. And then the one thing that had been pretty significant headwind to inflation, now we're seeing a little bit of a pop in it a certainly energy prices.

But again, if you think about where we are today versus kind of the next three months or so relative to last year, boy, we have some awfully easy comparisons relative to inflation. I mean basically bouncing off of record no activity, right, not record low, but record no activity. And so is it any wonder that we might start

to see a little bit of inflation pop here? No, But I think net net once the weather kind of normalizes in the middle of the country moves past the challenges they've faced over the last couple of weeks, we think that energy story is going to start to fade

a bit into the background. So we are obviously watching the inflation backdrop very very closely in terms of, you know, all the stimulus coming into the system and this economic mac recovery that's in the very early inning still, but we're not not particularly alarmed um that inflation is going to be strong enough to derail the path forward. I gotta say, Amanda, you won my heart there with the long,

strange trip, grateful dead reference. That's that's pretty good. She also Sarah referenced a door song break on through to the Other Side in a note which also in my I think we have the same record collection as as as kids have beended, but amazing. Yeah, you know, I have to I have to laugh one of the eye joke that it's one of the most important jobs that I have as the strategist for P and C. Other

people would say, you've completely lost your mind. But every year we try really hard to kind of pick a song of the year or a musical reference that we think is really going to define the next twelve months. Either from an economy perspective or from a market perspective, and so unfortunately or fortunately, I'm not sure, the musical reference was trucking bad. And you know, to start the year, we were actually seeing this really interesting and attractive cyclical

brightening of the backdrop. But then, of course, you know, everything fell apart with the pandemic that was not part of the musical reference by any means, was certainly not in our twenty outlook. And so it evolved from the cycle is going to keep on truck into my little long, strange trip. I love it so love worked. It still worked. I gotta say. I wrote a column years ago saying that the key to success as a strategist was how good your musical references were in the titles of notes.

So you win, I think you win. Yeah, that's the only metric I I really I really followed. But but I wanted to get back to that. You mentioned, you know that the notion of a head fake in inflation, and I think that's super important right now. Um, not only you know, looking at the stimulus in the pipeline, but also the sort of craziness in the energy markets because of the Texas situation. Uh, you look at commodities across the board, you look at copper, it's it's really

just going to the moon lately. Um. So I think that sort of uh colors the notion of the FED allowing inflation to run hot a little bit when you have such depressed base effects from the previous year, like like you you point out, Um, but I wonder, you know, if the bottom market could fall for that head fake and sell off even more aggressively. Um. And it gets to the notion of, well, what how does the FED respond?

Everyone's kind of worried about a tapering. Um. I wonder if that, you know, that could be the wrong worry and and maybe you know, we should start thinking about what with the the FED go the other way and maybe buy more on the long end and sort of really do an explicit type of yield curve control? Is that something? Is that a possibility? Do you think? Or if I have, I've been listening to the grateful debt

too much here and I'm going nothing. Well, you know, I don't pretend to be in the head of of the FED chairs and really kind of getting a sense of what they plan to do. I mean, I think it's certainly a possibility. Are base cases that you know the FED is going to continue not thinking about thinking about raising rates, right, A little bit of a riff there on on Powell's quote, you know, no major rate

increases for the next two or three years potentially. So we're not in the camp we've we've seen members of the streets start talking about pulling forward rate increases UM into the nearer term. Outlook, we are not in that camp. We we think that we're going to stand pat here for a while, um, and that the Quei story is just going to continue. I think the piece of the puzzle here that just doesn't get enough attention in terms of rate movements is really global interest rate differentials. UM.

There's that. We wrote a paper last fall talking about negative interest rates and the upside down world. That's a Stranger Things reference, not musical reference, but still ready for the next season. Totally totally obsessed with it, um. But we thought it was a really good analogy for the

upside down world of negative interest rates. And so I think you still have to take into consideration global interest rate differentials and how wide they are that giant sucking effect from negative interest rates that gravitational poll um that we're seeing it has to come into play here in capping or putting a lid on longer term interest rates. The ten years now the second highest interest rate across developed market, I think, behind Iceland if I did my

math right. Kind of fun fact there um and eight countries today in the developed world have a tenure with a negative yield. And so we really think that that is just going to continue to attract foreign investment into the US, really acting as that additional pressure on longer term rates, kind of creating this vicious or virtuous I guess, depending on how you want to look at it, kind of cycle. And so, yes, you know, the market can certainly take interest rates wherever they would like to. We've

we've seen that certainly in the last few weeks. But I do think that there is this gravitational pull um at the longer end that is going to eventually put the brakes on in a big way. The other thing that we haven't really talked about too too much is how much pressure the equity market is starting to feel from this rapid increase in rates that may very well also put some breaks on this um here in the

not too distant future. So what that said? I mean, I asked at the top of the show, at what point does the rising yield start to affect the equity market? And clearly we've seen some jitters this past week, and I feel like I've heard people ask this question over and over and over again, uh and pos in research reports left and right. Can't the point already be made, though, that we already have seen the bond market assert itself in the equity market when you look at the breakdown

of the returns we've seen this year. I mean, for example, this week, you had financials hit a record high, you had banks rise to the high since twenty two thousand and seven. At the same time, you have energy on pace for its best month versus the SMP on record, And yet we see the likes of Tesla and the r q t F, NASA one hundred of growth docks all coming under pressure. I mean, aren't we already seeing the repercussions of this? Oh? I think we absolutely are.

I think it will be a little bit more fleeting though than perhaps what the headlines suggests, and kind of what we're seeing in terms of regime shifts and market rotations and such I mean, if you think about the areas that are rallying on this this increase in rates here, it's really the value side of the equation. It's really

the go outside trade. And so and this has been the case for a while now, right post the fiser efficacy news back in November, that kicked off a firestorm of a rotation, and yet it really largely has been a sentiment shift. It has not been an underlying fundamental improvement and fundamental acceleration. And so we're really of the mindset that this is really getting pretty extended here in terms of this value rally in the short run, and

and this go outside trade. Not that we are of the mindset that we have to revert here and go back fully to the stay at home trade. But if you think about where the rubber meets the road, and it is in terms of earnings growth and fundamental improvement and profitability, the stay at home trade has really distinguished itself and continues to even as a function of Q four earnings season, such strong bright spots coming out of Q four earning season. It's still on that stay at

home trade side. And so even though valuations are pushing pretty elevated levels. Right, it's not a stretch to say equity valuations are indeed stretched, but we actually think the underlying fundamentals in many aspects of the stay at home trade, the growth areas in particular, justify evaluations and so on a growth adjusted basis, we actually think there's still room left. Um,

still much more of a hail Mary. I think in terms of this value rally, that we've seen markets starting to price for perfection on the value side of the equation when we know that we're nowhere near back to pre COVID you know, pre uh pre pre norms, and so pricing for a perfection in a backdrop that's anything, but that gives us a little bit of pause here at this stage of the market rally, you know, Amen.

I think one of the really fascinating things that's happened over the last year has been this new focus on sort of alternative data sets UH, sort of high frequency economic data, you know, whether it be open table reservations, UH, airline traffic on a on a sort of weekly daily basis. Um. I know you've looked a lot at this type of data. You even talk about moving I'm not quite sure what that is. I assume it's some kind of moving uh how much people are moving APP. But it's so moving

as a public transit from APP. And as a function of the pandemic, they actually started releasing data for major city usage and so that is actually, believe it or not, has become one of the key indicators for us in terms of the success or failure around reopening. And you called it out things like open table reservations, weekly retail sales data, even weekly airline passenger volumes. In pre COVID times, we would have never shortened up our line of sight

and looked at such noisy, high frequency indicators. We really would have been looking more at the traditional usual suspects like industrial production, monthly retail sales, and GDP. I mean today thinking about GDP growth and the GDP forecast. You know, three months lagged with a number of revisions. I can't remember what for lunch yesterday, let alone what happened three months ago. It's a blur, and so it's not really giving us the right line of sight in terms of

the path forward. And so no matter what indicator you're looking at on the high frequency side, any of these one that I've thrown out, um they're all still somewhere in the neighborhood of thirty to forty to fifty even seventy percent off pre COVID levels or even really year over year, given kind of where we are in late February here, and so I think it's just very helpful

in terms of gauging this path forward. The consumer may very well still be consuming to a degree, but clearly we're all still very much living in a stay at home world, and so it's also very reflective of this massive divergence between Main Street and Wall Street and kind of how which one hooks towards the other. Um, it's a key question that the jury is still a little

bit out yet, it's still pretty early on. Are actually very early on, but it seems like everyone's trying to game out how quickly people are going to feel comfortable going back to normal. And I'm just curious. I mean, considering that you track all this high frequency data in the early days of the vaccine rollout, have have we seen an increase in any type of this hyprecuncy data showing that some people are at least more comfortable. We

definitely have seen an improvement. So even though I'm saying we're somewhere in the neighborhood of thirty to seventy percent of such a wide wide range, but thirty to seventy percent off pre COVID levels. That is better than the depths of the lockdowns for sure, So we are definitely

moving in the right direction. I just think the market has started to price in basically a full reopening and back to business as usual and pre pandemic norms, and I think it's going to take a lot more time for the consumer and businesses and individuals to feel like things are back to normal. I think to two very recent data points that kind of reinforce that are on the sentiment side of the equation, So University of Michigan Consumer Sentiments Survey, worst reading since August of last year,

big nose dive relative to the last few months. Even on the business side of the equation, the n f I be Small Business Optimism reading all the way back to the worst level since last May. And I think that's still just very much emblematic or symbolic of the high degree of uncertainty that we still find ourselves in. In terms of the path forward, we are just hashtag not out of the Woods yet I'm gonna look up that hashtag. I think you just made that one up,

and then I don't know. I've been using that one for a while, and it's one of those things where if you use it and use it and use it, eventually maybe it catches on. It's kind of start saying it. I've already noticed in this episode that Mike's already said to the moon twice, so clearly Reddit has got into his head. It's rubbed off on me for sure, like

it or not. Need to throw in a win Lambeau here once, but but about it's kind of bottom line it for us here if you will, I mean to me, you sound, um, perhaps not risk averse, but but certainly cautious about uh say, equities and how you would position your your investments right now. You know, if I'm a P ANDC client and I get you on the phone, um or perhaps one of the advisors that that works for PNC, uh, what is the sort of allocation portfolio

allocation that you'd be advising at at this moment? Well, I think at this point in the market cycle and the economic recovery, you still have to be very picky and choosy. This is not an environment where a rising tide is going to lift all boats equally, and so on the equity side of the equation, even though I do believe that valuations are quite stretched, we still think

that there are pockets of opportunity. So the brightest star in the equity asset class universe as far as we're concerned as emerging markets, UM, we think, you know, from a from an investment thesis standpoint, it's just a really strong backdrop setting the stage here in on and beyond potentially at the very earliest stages of a major regime shift.

You know, the the baton tends to be handed off between the developed world and the emerging world every ten years or so, and we think this could very well be the start of that. When you look at the data as it relates to the pandemic UM they've done a better job managing through that up to this point, and it has enabled them to get their economies more reopened.

It isn't that they are fully reopened, but they are certainly ahead of the developed world, and so that has had really positive implications for the trajectory of earnings growth across much of the emerging markets world. And so it's the highest earnings growth projection across the equities fore and beyond, really significant, like thirty five percent. You're over your growth relative to just the S and P five D still still attractive, but up twenty four so a big difference

shoal there UM. So we think that that's a really interesting place to be. We also actually like the emerging market debt side of the equation. So from a policy stance, UM definitely many more levers to pull to the extent that they do run into a little bit of trouble or fits and starts around um an economic recovery and re acceleration here and then there's a fairly attractive yield

story as well. So so we're definitely very positive on all things emerging markets, other areas and equities that we do like very much. I'll throw it out there. It's a very controversial trade called the q q q H. It's very very much in keeping with that stay at

home trade. You know. They've really been able to, as we talked earlier, muscle through the pandemic and distinguish themselves in so many ways, and we think that will be used to their advantage in terms of the growth and yield star of world that we think we're still very much in and that lies ahead, so we're very positive

on that area. We also like global infrastructure, which is kind of an interesting one, a quasi fixed income like exposure, taking a little bit of cyclicality out of equities, but definitely jacking up the potential for yield and income. And again in a yield star world, you have to get a little creative about how you pick it up in a thoughtful way, and so we think that's also interesting,

like think like m LPs that type of thing. Well, I think what I would say is we we would avoid energy specific infrastructure, so it would be more traditional infrastructure airports, toll roads, rail, et cetera. That kind of you know, real asset type infrastructure investments as opposed to

commodity based. The commodity ones just given you know what's happening with w T I and a whole host of other commodity prices inject an awful lot of volatility into it, and so you don't really the end up with the ballast that we're striving for um in terms of that exposure. And then on the fixed income side, you know, if we think equities are stretched and expensive. We think it's

much more so in fixed income. If you look at the yield to duration ratio for investment grade corporates, even with the backup and rates that we've had, we're sitting at an all time high, handily favoring stocks over bonds, and so unfortunately, investors are being pushed a little bit further out the risk curve than they might otherwise like to try to pick up some yield, and we don't think that story is going to change too too much

over the next few years. So we do have exposures to leverage loans to high yield um and then, as I said in the beginning, emerging market that got to be really thoughtful about picking up those types of exposures. Though credit analysis is just so critically important in some of these below investment grade asset classes, and especially given the uncertainty in the backdropt you don't want to just buy a passive benchmark like exposure there. So those are

a few areas that we still think are attractive. Gave us a handful there, and now that Amanda's bottom lined it all for us, I think we should let Charlie Pellett tell us what time. It is like, stand clear of the craziest things we saw in markets this week? All right, it is indeed that time. Uh, Starry, let's start with you on I'm curious what you got for

us this week? Alright. So I've been on a roll with the names that sound like other names, so I figured why not just keep going with it this week? There is this one story on the Bloomberg this week that it was just funny almost the way it was written, And the headline was biotex that sound like cannabis stocks joined frenzy pot rally. Um. So I'll just I'll read

you part of this. Um. So it says drug makers that target the and I hope I'm pronouncing this right, the endocam, a binoid system which is believed to play a role in regulating body weight and controlling energy balance, have skyrocketed in. Then it says, well, those biotechs wouldn't necessarily benefit from any legislative push for the pot industry. Analysts say the stocks have jumped on the idea that

they would be associated somehow with cannabis. Then there's a sentence that just says and they are not so very very blunt there, but just to give you a couple examples of Corbus Pharmaceuticals has almost doubled this year. Our Tello by Biosciences uh is up a So some massive rallies from companies that are believed to possibly be beneficiaries of the new administration in Washington, d C. But to repeat that sentence, supposedly they are not. So that's pretty good.

That's pretty good. I see a lot of this these days. I'm gonna launch a spack that's like cannabis and blockchain unlimited. Uh, I'm sure it would do very well. Yeah, But all right, a man, have they prepared you for our sillyutrition? Here the craziest things we saw in markets this week? Do you do you have anything? First? I have one for you, And I don't know if I'm going out on a limb with this one, but I'm going going out on a limb is always good for them. I'm going NBA

top shots. I don't know about you all, but I feel like we've kind of started to enter the crypto kiddie phase of the crypto bowl market here. Um that ended in kind of epic disaster back in two thousand and seventeen. But I don't know what is up with these. They call them non fungible tokens. It's amazing to see that these things have been trading for over hundred thousand dollars a pop, and even just in the last week alone,

cumulative transaction value more than a hundred million dollars. To me, it's just mind blowing where we are in the cycle here. I'm convinced that NBA players are bidding up the prices of their own highlights. I think that's what's going on. I think we're gonna in a few years we're gonna read about NBA players who went broke because they spent their entire patient buying their own highlights on top shot, Mike,

you should start looking into this, I think. I guess you can't short them, though, I uh but and shout out to one listener also brought up n f p s. I forgive me, I did not write down their handle, but they pointed out The New York Times had a big story on n f t s and it is it's it's remarkable. I mean, it's it's just this feels like there's just oversupply of money in the world that's chasing anything like this that that you could possibly make

a buck off of. It's amazing. It's amazing and and some I mean a little bit different, but somewhat along these lines. Um Fred Hoffman, he's a professor at Rutger's Business School. He reached out and he showed a New York Times story basically just saying that there's two liber on James cards now worth seven million dollars. So again the alternative assets space, Mike, especially just looking at sports cards, I mean, through the roof to the moon, as you

would say, it's it's absolutely amazing. I cannot wrap my head around it. In a way. I guess maybe it it works as sort of a valve, you know, a release valve of sort of excessive speculation in the markets. But maybe that's a generous way to look at it. I don't know, but I'll give you, uh my crazy thing which I hate to go back to game stop, but of course we have to go back to game stop. And what what is a week without a game? It really is transfixed us all but the craziest thing about

this rally to me, this surge higher on Wednesdays. I looked up the it's a function on the Bloomberg called the quote recap, which tells you like, you know what exchange or was it a dark pool that it was

executed on, and the size of the trade. And during that run up there was a remarkable huge number of single share trades involved, Like the vast majority of trades were for for one single stock, which I think you know obviously that your sort of knee jerk reaction is, well, this is the Wall Street bets crowd, the retail buying one share at a time. I mean, maybe that's what it means to live in a commission free world, is you can you know, you can buy one shared at

a time. Others were saying, you know, maybe it's uh, it's an algou, which I to me and I'm no expert on algoes, but you know, maybe if there's someone out there as a listener who is, they could call us up and let us know what they think. But I always picture algoes as being trading you know, around lots of stock, in other words, a hundred shares at

a time. I I would surprise me again as a non expert, but it would surprise me for an algo to actually break up trading into single shares at it's time, because I was mostly on the lip markets, on the NYC and the NASDAC and it just doesn't necessarily make sense to me. Larry. I asked Larry tab of our our guru here on market structure at Bloomberg Intelligence. He was kind of dumbfounded too. He said, Yeah, there's definitely probably some retail they might be uh separate account allocations.

You know, some r I a putting people all their their clients into a little bit of game stop. I don't know, man, I don't know. If I don't know, if I can imagine any r I doing that with putting their clients in game stop, what do you think? I can't fathom it. Honestly, I would feel like that would be an epic breakdown from a risk management standpoint.

So yeah, that it wasn't us, It wasn't me. Well, well, if anyone out there listening was trading game stop share by share, give us a call and let us know. And then we also got a tweet from another listener that I want to share also give some numbers around this a bit. Her name is a Laundre Garcia at a Laundra g M, and she said the craziest thing I saw in markets this week was brought to my attention by matt Levin's Money Stuff and she said the

media and robin Hood account size is two. Meanwhile, the average account size is five thousand dollars, and of robin Hood traders trade options, so that gives you a sense. I mean, obviously the median account size at robin Hood is not so large, so maybe they are trading share by share, like yeah, that's boy. And the difference between

the average and the median is it's very big. Yeah, So mostly you know, I guess you conclude it's mostly small dollar accounts, but then there are a few really big ones in there that that pulled up pretty interesting. That's good. And by the way, matt Levine's column is a is a great source of crazy. It is. Oh

every column has something new and crazy in it. So you ever short of ideas, I'll admit some times occasionally I am can go and go check out matt Levin's Money Stuff com Now that you're back, absolutely well, Amanda Gotty, We're gonna have to leave it there. But thank you so so much for joining Mike and Iva Speak. Thank you so much for having me it was such fun What Goes Up. We'll be back next week. Until then, you can find us on the Bloomberg Terminal, website and app,

or wherever you get your podcasts. We'd love it if you took the time to rate and review the show on app podcast so more listeners can find us. And you can find us on Twitter, follow me at Sarah Ponzack, Mike is that Rey Anonymous, and you can also follow Bloomberg Podcasts at Podcasts. Also thank you to Charlie Pellett, the Bloomberg Radio and the voice of the New York City subway system. What Goes Up is produced by Topur Forehead.

The head of Bloomberg podcast is Francesca Levi. Thanks for listening. See you next time. Before