RUSH TRANSCRIPT 24 just ░░░░░░░░ at 24 10 all ░░░░░░░░ that s turning back ░░░░░░░░ the major averages joining ░░░░░░░░ now is Greg Swenson ░░░░░░░░ partner at brigham Greg ░░░░░░░░ broad take a ways ░░░░░░░░ how the market actually ░░░░░░░░ the day ahead of ░░░░░░░░ is they call it ░░░░░░░░ Thanksgiving Not really any ░░░░░░░░ surprise because you saw ░░░░░░░░ selloff the last few ░░░░░░░░ because of the higher ░░░░░░░░ rates so it s ░░░░░░░░ s it s not ░░░░░░░░ surprise that there was ░░░░░░░░ bit of a of ░░░░░░░░ buying opportunity I m ░░░░░░░░ sure that will last ░░░░░░░░ you know for into ░░░░░░░░ We re coming when ░░░░░░░░ come back into the ░░░░░░░░ on Friday But I ░░░░░░░░ the doesn t really ░░░░░░░░ the near term Analysis ░░░░░░░░ that long duration assets ░░░░░░░░ re going to be ░░░░░░░░ so I see some ░░░░░░░░ with tech because of ░░░░░░░░ higher interest rates and ░░░░░░░░ risks Speaking of inflation ░░░░░░░░ that s one of ░░░░░░░░ big factors kind of ░░░░░░░░ wearing and weighing on ░░░░░░░░ market right now I ░░░░░░░░ you re kind of ░░░░░░░░ the camp that doesn ░░░░░░░░ think that inflation is ░░░░░░░░ transitory break that down ░░░░░░░░ us Yeah look at ░░░░░░░░ m just amazed that ░░░░░░░░ the people that are ░░░░░░░░ that it s transitory ░░░░░░░░ sticking with that story ░░░░░░░░ that the numbers are ░░░░░░░░ higher than then they ░░░░░░░░ in that the market ░░░░░░░░ over the last few ░░░░░░░░ and it s also ░░░░░░░░ persistent righted it hasn ░░░░░░░░ been tempered are you ░░░░░░░░ taos favorite word Transitory ░░░░░░░░ you ll notice that ░░░░░░░░ even Powell didn t ░░░░░░░░ that word in his ░░░░░░░░ last month so you ░░░░░░░░ I think that even ░░░░░░░░ though those that are ░░░░░░░░ an argument have to ░░░░░░░░ it and you ll ░░░░░░░░ it you see it ░░░░░░░░ the administration who a ░░░░░░░░ of the a lot ░░░░░░░░ the you know but ░░░░░░░░ t President Biden are ░░░░░░░░ inflation much more seriously ░░░░░░░░ so I don t ░░░░░░░░ it s going it ░░░░░░░░ not transitory you know ░░░░░░░░ ve got way way ░░░░░░░░ much demand over over ░░░░░░░░ a of demand over ░░░░░░░░ last 8 18 months ░░░░░░░░ with the you know ░░░░░░░░ with dropping 4 trillion ░░░░░░░░ the into the money ░░░░░░░░ and and potentially another ░░░░░░░░ to 4 trillion It ░░░░░░░░ going to be misallocated ░░░░░░░░ the private sector and ░░░░░░░░ you ve got constraints ░░░░░░░░ the supply side so ░░░░░░░░ same people that argue ░░░░░░░░ it s transitory and ░░░░░░░░ s a surprising issue ░░░░░░░░ also the ones that ░░░░░░░░ suggesting we should have ░░░░░░░░ regulations more vaccine mandates ░░░░░░░░ know the bbb plan ░░░░░░░░ going to have some ░░░░░░░░ more sort of hostility ░░░░░░░░ job creator policies and ░░░░░░░░ know coming weather show ░░░░░░░░ from the energy a ░░░░░░░░ regime so I think ░░░░░░░░ is sticking around for ░░░░░░░░ while Given the persistent ░░░░░░░░ around inflation and then ░░░░░░░░ course the Fed minutes ░░░░░░░░ we did get today ░░░░░░░░ is your take on ░░░░░░░░ timeline when Powell and ░░░░░░░░ Fed will actually increase ░░░░░░░░ and do they speed ░░░░░░░░ the taper what is ░░░░░░░░ timeline look like Yeah ░░░░░░░░ s it s a ░░░░░░░░ question and of course ░░░░░░░░ s the great mystery ░░░░░░░░ and you saw them ░░░░░░░░ market is starting to ░░░░░░░░ if you look at ░░░░░░░░ short term futures It ░░░░░░░░ it looks like there ░░░░░░░░ an anticipation of possibly ░░░░░░░░ increases next year at ░░░░░░░░ that s what the ░░░░░░░░ and is telling us ░░░░░░░░ you know who knows ░░░░░░░░ mean the tapering even ░░░░░░░░ it s 15 billion ░░░░░░░░ month that still leaves ░░░░░░░░ Fed buying a 105 ░░░░░░░░ a month So I ░░░░░░░░ in the near term ░░░░░░░░ the market Stuart liquid ░░░░░░░░ will do just fine ░░░░░░░░ that with the continued ░░░░░░░░ easing essentially And I ░░░░░░░░ I don t I ░░░░░░░░ t imagine that that ░░░░░░░░ going to change but ░░░░░░░░ next year for sure ░░░░░░░░ can anticipate that because ░░░░░░░░ the inflation is not ░░░░░░░░ away you re seeing ░░░░░░░░ little bit more debate ░░░░░░░░ the Fed and that ░░░░░░░░ a good sign because ░░░░░░░░ s not a function ░░░░░░░░ of what I want ░░░░░░░░ to do it s ░░░░░░░░ function of what they ░░░░░░░░ do and I think ░░░░░░░░ might be changing You ░░░░░░░░ from inflation to valuation ░░░░░░░░ have seen kind of ░░░░░░░░ just shoot through the ░░░░░░░░ over the last year ░░░░░░░░ year to really and ░░░░░░░░ new arguing that maybe ░░░░░░░░ re the law has ░░░░░░░░ lot of companies a ░░░░░░░░ of equities over valued ░░░░░░░░ at high valuations I ░░░░░░░░ looking at your notes ░░░░░░░░ you guys point to ░░░░░░░░ at with these and ░░░░░░░░ that break that down ░░░░░░░░ as it compares to ░░░░░░░░ of the U S ░░░░░░░░ No it s it ░░░░░░░░ it s something that ░░░░░░░░ s a longer term ░░░░░░░░ he didn t hurt ░░░░░░░░ to longer term play ░░░░░░░░ the U S markets ░░░░░░░░ done so well in ░░░░░░░░ last 2 years with ░░░░░░░░ the you know the ░░░░░░░░ dose of monetary you ░░░░░░░░ got this huge price ░░░░░░░░ between the U S ░░░░░░░░ and the global markets ░░░░░░░░ us are in I ░░░░░░░░ argue the European markets ░░░░░░░░ attractive so so just ░░░░░░░░ a nominal price difference ░░░░░░░░ will be some convergence ░░░░░░░░ that and so I ░░░░░░░░ going to be much ░░░░░░░░ off going long or ░░░░░░░░ out of the U ░░░░░░░░ into the European equity ░░░░░░░░ you ve got the ░░░░░░░░ and that the p ░░░░░░░░ ratios the r a ░░░░░░░░ steep difference between the ░░░░░░░░ he and and global ░░░░░░░░ ex us right now ░░░░░░░░ s you know roughly ░░░░░░░░ times in the s ░░░░░░░░ p and it s ░░░░░░░░ 14 times in the ░░░░░░░░ indices ex us words ░░░░░░░░ that s 15 and ░░░░░░░░ half and 13 3 ░░░░░░░░ s the 20 year ░░░░░░░░ so we should see ░░░░░░░░ convergence both from nominal ░░░░░░░░ as well as as ░░░░░░░░ well as price earnings ░░░░░░░░ and then you ve ░░░░░░░░ you and dividends much ░░░░░░░░ in Europe and defense ░░░░░░░░ in the U K ░░░░░░░░ if you look at ░░░░░░░░ like bp is one ░░░░░░░░ always talk about I ░░░░░░░░ with with you you ░░░░░░░░ you 5 dividend yield ░░░░░░░░ s not going away ░░░░░░░░ their historically very good ░░░░░░░░ maintaining that and they ░░░░░░░░ increase their prices because ░░░░░░░░ re exposed to to ░░░░░░░░ so it s a ░░░░░░░░ inflation hedge There s ░░░░░░░░ companies like that in ░░░░░░░░ financials for example and ░░░░░░░░ the last point is ░░░░░░░░ equities are are much ░░░░░░░░ a much greater exposure ░░░░░░░░ cyclical so if you ░░░░░░░░ if you re still ░░░░░░░░ the rotation out of ░░░░░░░░ into cyclicals and you ░░░░░░░░ got you looking for ░░░░░░░░ hedges in financials and ░░░░░░░░ It s a great ░░░░░░░░ to be because it ░░░░░░░░ much more weighted to ░░░░░░░░ cyclicals and they have ░░░░░░░░ less exposure to tech ░░░░░░░░ again you know being ░░░░░░░░ to long duration assets ░░░░░░░░ I think that makes ░░░░░░░░ lot of sense Was ░░░░░░░░ to ask in terms ░░░░░░░░ how do you play ░░░░░░░░ and I think you ░░░░░░░░ of outlined there the ░░░░░░░░ sectors of the sectors ░░░░░░░░ you think of the ░░░░░░░░ what energy and banks ░░░░░░░░ for sure I mean ░░░░░░░░ financials and energy Both ░░░░░░░░ the U S and ░░░░░░░░ but I think there ░░░░░░░░ a lot more upside ░░░░░░░░ those sectors in Europe ░░░░░░░░ can even play then ░░░░░░░░ know just buying indices ░░░░░░░░ not necessarily individual stocks ░░░░░░░░ but also if you ░░░░░░░░ talking about you know ░░░░░░░░ mention regulatory burdens and ░░░░░░░░ re seeing much more ░░░░░░░░ that in the U ░░░░░░░░ There s there s ░░░░░░░░ risks that government policy ░░░░░░░░ going to do have ░░░░░░░░ real effect on sectors ░░░░░░░░ energy and financials where ░░░░░░░░ you know the European ░░░░░░░░ have already baked that ░░░░░░░░ they they ve had ░░░░░░░░ regulatory burden in your ░░░░░░░░ for you know for ░░░░░░░░ that s relatively new ░░░░░░░░ the U S in ░░░░░░░░ last you know 8 ░░░░░░░░ 9 months But but ░░░░░░░░ think you ll see ░░░░░░░░ that companies like bp ░░░░░░░░ total how the French ░░░░░░░░ giant They re way ░░░░░░░░ of the curve on ░░░░░░░░ to renewables and they ░░░░░░░░ invested a lot more ░░░░░░░░ renewables or in the ░░░░░░░░ the so called transition ░░░░░░░░ the U S majors ░░░░░░░░ so what weather that ░░░░░░░░ you know right or ░░░░░░░░ It doesn t really ░░░░░░░░ because it s the ░░░░░░░░ policies that are going ░░░░░░░░ dictate that so so ░░░░░░░░ think there s no ░░░░░░░░ of reasons to to ░░░░░░░░ into European equities right ░░░░░░░░ especially in the u ░░░░░░░░ You mentioned kind of ░░░░░░░░ hedges in that kind ░░░░░░░░ play that you are ░░░░░░░░ their I wonder what ░░░░░░░░ some other kind of ░░░░░░░░ hedges that investors could ░░░░░░░░ of consider are considering ░░░░░░░░ know that this inflationary ░░░░░░░░ to your point earlier ░░░░░░░░ you think is more ░░░░░░░░ than transitory Sure yeah ░░░░░░░░ mean of course you ░░░░░░░░ about you know these ░░░░░░░░ sectors that do well ░░░░░░░░ inflation Steve for yield ░░░░░░░░ higher interest rates but ░░░░░░░░ alternatives you know there ░░░░░░░░ I think you should ░░░░░░░░ in some floating rate ░░░░░░░░ funds stay away from ░░░░░░░░ duration acts Assets so ░░░░░░░░ would not be in ░░░░░░░░ fixed income instruments right ░░░░░░░░ But there are ways ░░░░░░░░ play if you need ░░░░░░░░ yield there are ways ░░░░░░░░ play that with tips ░░░░░░░░ with floating rate bond ░░░░░░░░ like bank loan funds ░░░░░░░░ adjust with us interest ░░░░░░░░ go up of course ░░░░░░░░ and Bitcoin it s ░░░░░░░░ off the highs you ░░░░░░░░ that we kind another ░░░░░░░░ correction here but remember ░░░░░░░░ few months ago was ░░░░░░░░ the got up to ░░░░░░░░ 60 s now to ░░░░░░░░ mid 50 s I ░░░░░░░░ did coin is a ░░░░░░░░ All those volatile It ░░░░░░░░ a great long term ░░░░░░░░ then private capital if ░░░░░░░░ know as as individual ░░░░░░░░ seem to be getting ░░░░░░░░ access to private capital ░░░░░░░░ know we like critical ░░░░░░░░ especially in emerging markets ░░░░░░░░ are uncorrelated 2 other ░░░░░░░░ but also tethered to ░░░░░░░░ prices so as inflation ░░░░░░░░ know it hurts other ░░░░░░░░ and devalues the currency ░░░░░░░░ ve got exposure to ░░░░░░░░ whether it s through ░░░░░░░░ infrastructure housing and any ░░░░░░░░ of critical infrastructure assets ░░░░░░░░ emerging markets that are ░░░░░░░░ to come and these ░░░░░░░░ they go up the ░░░░░░░░ of these assets go ░░░░░░░░ so that there s ░░░░░░░░ lot of alternatives that ░░░░░░░░ you can invest in ░░░░░░░░ you had a lens ░░░░░░░░ higher inflation As inflation ░░░░░░░░ a persistent concern among ░░░░░░░░ minds of many investors ░░░░░░░░ that we kind of ░░░░░░░░ there on the hedges ░░░░░░░░ inflation and certainly the ░░░░░░░░ in the European market ░░░░░░░░ always great to have ░░░░░░░░ on greg s when ░░░░░░░░ founding partner of brig ░░░░░░░░ I want to take ░░░░░░░░ break but coming up ░░░░░░░░ of today s top ░░░░░░░░ including a verdict in ░░░░░░░░ trial The 3 men ░░░░░░░░ of murdering Ahmaud Arbery ░░░░░░░░ with us.