RUSH TRANSCRIPT Very good ░░░░░░░░ I can thank you ░░░░░░░░ much just meant in ░░░░░░░░ pulse when you hear ░░░░░░░░ bloomberg interactive brokers studio ░░░░░░░░ s talk about the ░░░░░░░░ the bond market and ░░░░░░░░ not because again get ░░░░░░░░ in you couldn t ░░░░░░░░ 20 twenty two just ░░░░░░░░ you get crushed in ░░░░░░░░ question bonds four point ░░░░░░░░ percent in a two ░░░░░░░░ button seems pretty good ░░░░░░░░ me for the treasury ░░░░░░░░ definitely is especially after ░░░░░░░░ Last year To next ░░░░░░░░ s fed meeting look ░░░░░░░░ the swap traders pricing ░░░░░░░░ a roughly one third ░░░░░░░░ that we re going ░░░░░░░░ see that harkness yeah ░░░░░░░░ so that to be ░░░░░░░░ of my next we ░░░░░░░░ will have full coverage ░░░░░░░░ that particular that only ░░░░░░░░ think she s head ░░░░░░░░ investment grade credit strategy ░░░░░░░░ in and regal So ░░░░░░░░ what you think about ░░░░░░░░ trade American go put ░░░░░░░░ money in two year ░░░░░░░░ note I think that ░░░░░░░░ a great trade Paul ░░░░░░░░ I d advise even ░░░░░░░░ into corporate bond You ░░░░░░░░ five and a half ░░░░░░░░ so it s work ░░░░░░░░ minimal incremental with to ░░░░░░░░ into corporate so not ░░░░░░░░ ways the bond market ░░░░░░░░ us about the direction ░░░░░░░░ the economy At this ░░░░░░░░ in what it can ░░░░░░░░ for the vegetation next ░░░░░░░░ I think it s ░░░░░░░░ us that we re ░░░░░░░░ pretty good Caitlin seen ░░░░░░░░ pretty big rally Corporate ░░░░░░░░ are almost back at ░░░░░░░░ level of the beginning ░░░░░░░░ the year pre the ░░░░░░░░ crisis and we seen ░░░░░░░░ big recovery in both ░░░░░░░░ spreads and equities particularly ░░░░░░░░ the region That gives ░░░░░░░░ some confidence So any ░░░░░░░░ grade space natalie and ░░░░░░░░ of How are you ░░░░░░░░ about things Are you ░░░░░░░░ to sector by sector ░░░░░░░░ you focusing more on ░░░░░░░░ How are you guys ░░░░░░░░ the investigate space these ░░░░░░░░ Yeah it s a ░░░░░░░░ of items I definitely ░░░░░░░░ and we re seeing ░░░░░░░░ demand for the wrong ░░░░░░░░ of the curb even ░░░░░░░░ those the front and ░░░░░░░░ you mention is very ░░░░░░░░ We aren t sure ░░░░░░░░ long it s going ░░░░░░░░ last or some is ░░░░░░░░ wanna lock in these ░░░░░░░░ and 30 year yield ░░░░░░░░ these higher levels and ░░░░░░░░ corporate bonds are getting ░░░░░░░░ to six percent There ░░░░░░░░ receptor we do like ░░░░░░░░ technology We think banking ░░░░░░░░ a little bit more ░░░░░░░░ run protect early in ░░░░░░░░ of the regionals and ░░░░░░░░ are most attractive in ░░░░░░░░ front end up and ░░░░░░░░ at the curb What ░░░░░░░░ you hearing from clients ░░░░░░░░ this point as far ░░░░░░░░ what their concerns are ░░░░░░░░ maybe concerned maybe they ░░░░░░░░ at the beginning of ░░░░░░░░ year not so much ░░░░░░░░ this point Can the ░░░░░░░░ of the became the ░░░░░░░░ with the recession and ░░░░░░░░ were already pricing and ░░░░░░░░ cuts and that s ░░░░░░░░ gonna be the case ░░░░░░░░ don t think right ░░░░░░░░ they re concerned about ░░░░░░░░ of this treasury supply ░░░░░░░░ re likely to get ░░░░░░░░ the death that feeling ░░░░░░░░ people are talking anywhere ░░░░░░░░ five hundred billion to ░░░░░░░░ trillion of tito supply ░░░░░░░░ summer and they re ░░░░░░░░ that nadine crowd out ░░░░░░░░ and other places such ░░░░░░░░ corporate bonds So in ░░░░░░░░ one of the the ░░░░░░░░ for investors is trying ░░░░░░░░ get a sense of ░░░░░░░░ this economy really is ░░░░░░░░ So When you re ░░░░░░░░ come to you or ░░░░░░░░ come to with an ░░░░░░░░ Do ask them hey ░░░░░░░░ you run your recession ░░░░░░░░ and if so how ░░░░░░░░ this this credit fair ░░░░░░░░ is it top of ░░░░░░░░ for you guys Exactly ░░░░░░░░ though recession may still ░░░░░░░░ you know six months ░░░░░░░░ a year out if ░░░░░░░░ does come we are ░░░░░░░░ running our recession models ░░░░░░░░ are these companies going ░░░░░░░░ do Fortunately most companies ░░░░░░░░ been well parent prepared ░░░░░░░░ is the most that ░░░░░░░░ telegraphed recession potentially campaign ░░░░░░░░ they have started already ░░░░░░░░ cut their contacts or ░░░░░░░░ Dividends are hereby back ░░░░░░░░ necessary so many companies ░░░░░░░░ defensively position We ve ░░░░░░░░ seen a number of ░░░░░░░░ backed investment great them ░░░░░░░░ yield that hear such ░░░░░░░░ occidental petroleum recently when ░░░░░░░░ comes to this concern ░░░░░░░░ how the u s ░░░░░░░░ deal would potentially trigger ░░░░░░░░ one trillion dollar liquidity ░░░░░░░░ special we re looking ░░░░░░░░ what s happening in ░░░░░░░░ bond market What s ░░░░░░░░ take on that I ░░░░░░░░ maybe overblown because globally ░░░░░░░░ are still flush with ░░░░░░░░ We see that in ░░░░░░░░ corporate market where the ░░░░░░░░ are like five times ░░░░░░░░ scribe Yesterday we had ░░░░░░░░ us bancorp in the ░░░░░░░░ with three and a ░░░░░░░░ italian and they actually ░░░░░░░░ 18 billion of demand ░░░░░░░░ that deal So it ░░░░░░░░ like the market will ░░░░░░░░ able to absorb all ░░░░░░░░ this at Dulles you ░░░░░░░░ Gets kind of I ░░░░░░░░ to go of these ░░░░░░░░ of the new issue ░░░░░░░░ As a former banker ░░░░░░░░ I was like to ░░░░░░░░ deals the deal flow ░░░░░░░░ and who s coming ░░░░░░░░ mark and what kind ░░░░░░░░ pricing they re getting ░░░░░░░░ Even the rates are ░░░░░░░░ it seems like new ░░░░░░░░ is still pretty active ░░░░░░░░ your phone ringing off ░░░░░░░░ hook from our friends ░░░░░░░░ Wall Street Yeah absolutely ░░░░░░░░ new markets been very ░░░░░░░░ person There was a ░░░░░░░░ of issuance trying to ░░░░░░░░ ahead of the debt ░░░░░░░░ and the banks we ░░░░░░░░ kind of locked out ░░░░░░░░ the market for a ░░░░░░░░ while they re in ░░░░░░░░ and April Now that ░░░░░░░░ that killings over we ░░░░░░░░ thanks come back to ░░░░░░░░ you and 20 seven ░░░░░░░░ in this week though ░░░░░░░░ re still about forty ░░░░░░░░ under the rate of ░░░░░░░░ they had in two ░░░░░░░░ and 20 two so ░░░░░░░░ still expect to see ░░░░░░░░ lot more supply But ░░░░░░░░ that region also been ░░░░░░░░ to access the markets ░░░░░░░░ s we We think ░░░░░░░░ regions novels or start ░░░░░░░░ come and have about ░░░░░░░░ And when you see ░░░░░░░░ of these new deals ░░░░░░░░ they investor friendly in ░░░░░░░░ sense that the some ░░░░░░░░ covenants in their orgies ░░░░░░░░ a sense that it ░░░░░░░░ more the dilemma Judges ░░░░░░░░ on a part of ░░░░░░░░ issue where we in ░░░░░░░░ market right now Yeah ░░░░░░░░ investment grade there s ░░░░░░░░ not that strong covenants ░░░░░░░░ we are seeing Investors ░░░░░░░░ back on the high ░░░░░░░░ market to make sure ░░░░░░░░ covenants our little bit ░░░░░░░░ Here we are seeing ░░░░░░░░ concessions so in terms ░░░░░░░░ pricing and then in ░░░░░░░░ little bit on the ░░░░░░░░ so that these deals ░░░░░░░░ in the secondary market ░░░░░░░░ have to ask you ░░░░░░░░ the yield curve What ░░░░░░░░ you think this is ░░░░░░░░ Us about the economy ░░░░░░░░ s not a good ░░░░░░░░ It s doubly a ░░░░░░░░ indicator even though we ░░░░░░░░ t as inverted as ░░░░░░░░ weren t too tense ░░░░░░░░ but I also think ░░░░░░░░ you know that that ░░░░░░░░ s going to leave ░░░░░░░░ idea for longer probably ░░░░░░░░ two thousand and 20 ░░░░░░░░ and there is always ░░░░░░░░ risk that that that ░░░░░░░░ have broken something and ░░░░░░░░ really haven t had ░░░░░░░░ long enough timeline to ░░░░░░░░ all of these attack ░░░░░░░░ take place in the ░░░░░░░░ The Silicon Valley bank ░░░░░░░░ was definitely one indication ░░░░░░░░ that that may have ░░░░░░░░ too far Now now ░░░░░░░░ invest solely in the ░░░░░░░░ or do go outside ░░░░░░░░ us as well Now ░░░░░░░░ invest globally lots of ░░░░░░░░ markets We have a ░░░░░░░░ dedicated team here on ░░░░░░░░ A little bit let ░░░░░░░░ go there a little ░░░░░░░░ when you think outside ░░░░░░░░ the U s borders ░░░░░░░░ of How do you ░░░░░░░░ prioritize Where were you ░░░░░░░░ are looking We re ░░░░░░░░ at countries with stable ░░░░░░░░ we re also looking ░░░░░░░░ oil importers versus oil ░░░░░░░░ were following the election ░░░░░░░░ which is going on ░░░░░░░░ it s really k ░░░░░░░░ across markets and we ░░░░░░░░ talking about exporters versus ░░░░░░░░ for crude and things ░░░░░░░░ that Is it obviously ░░░░░░░░ correlation with what we ░░░░░░░░ seen especially with Oil ░░░░░░░░ in the u s ░░░░░░░░ around when you re ░░░░░░░░ about that sort of ░░░░░░░░ dollars threshhold there in ░░░░░░░░ that could mean for ░░░░░░░░ opportunities in those particular ░░░░░░░░ markets Luckily we do ░░░░░░░░ seventy dollars is close ░░░░░░░░ a floor so we ░░░░░░░░ t for seen a ░░░░░░░░ in oil so we ░░░░░░░░ the man is likely ░░░░░░░░ to hold up fairly ░░░░░░░░ but it also depends ░░░░░░░░ the guts though the ░░░░░░░░ if we got one ░░░░░░░░ many think about in ░░░░░░░░ markets are much in ░░░░░░░░ is equities It s ░░░░░░░░ s it s credit ░░░░░░░░ You think about China ░░░░░░░░ such a big part ░░░░░░░░ the embassy I mean ░░░░░░░░ How do you think ░░░░░░░░ emerging markets where where ░░░░░░░░ re you find opportunities ░░░░░░░░ you even think about ░░░░░░░░ or you cannot stay ░░░░░░░░ bit more close to ░░░░░░░░ Yeah China s a ░░░░░░░░ by vacated market cause ░░░░░░░░ s a very high ░░░░░░░░ end of the the ░░░░░░░░ where you have such ░░░░░░░░ the barbers and 10 ░░░░░░░░ good investment grade credit ░░░░░░░░ then you have the ░░░░░░░░ property market which were ░░░░░░░░ little bit cautious on ░░░░░░░░ it really starts to ░░░░░░░░ down to a name ░░░░░░░░ name basis even within ░░░░░░░░ emerging markets something I ░░░░░░░░ to get your take ░░░░░░░░ Because we re going ░░░░░░░░ get another update on ░░░░░░░░ see if tc did ░░░░░░░░ this afternoon around three ░░░░░░░░ and I noticed particularly ░░░░░░░░ the bond market when ░░░░░░░░ comes to the shorting ░░░░░░░░ s happening on the ░░░░░░░░ s 10 year it ░░░░░░░░ a very extreme position ░░░░░░░░ usually that happens when ░░░░░░░░ are thinking that yields ░░░░░░░░ betting that they would ░░░░░░░░ higher but such extreme ░░░░░░░░ when I ve talked ░░░░░░░░ some sources think that ░░░░░░░░ the opposite effect in ░░░░░░░░ pushing year olds