RUSH TRANSCRIPT Chicago All ░░░░░░░░ for you gaurav Chief ░░░░░░░░ officer palace capital advisors ░░░░░░░░ Gaurav good to see ░░░░░░░░ ramp in yields that ░░░░░░░░ ve seen right Yeah ░░░░░░░░ calm down overnight for ░░░░░░░░ versus 33 or so ░░░░░░░░ know in trade overnight ░░░░░░░░ lot of folks think ░░░░░░░░ s look pricing in ░░░░░░░░ stronger U S economy ░░░░░░░░ the folks that would ░░░░░░░░ look is pricing in ░░░░░░░░ Trump victory This is ░░░░░░░░ the bond market feels ░░░░░░░░ I think they don ░░░░░░░░ care either Either way ░░░░░░░░ it s Trump or ░░░░░░░░ it s going to ░░░░░░░░ more fiscal and they ░░░░░░░░ pretty happy with that ░░░░░░░░ think equities are fully ░░░░░░░░ You prefer private equity ░░░░░░░░ is this going to ░░░░░░░░ if the bond market ░░░░░░░░ if betting platforms Right ░░░░░░░░ we get higher yields ░░░░░░░░ rates mean it means ░░░░░░░░ this whole area the ░░░░░░░░ couple of years of ░░░░░░░░ a good time to ░░░░░░░░ the can have to ░░░░░░░░ longer That is true ░░░░░░░░ think we ve seen ░░░░░░░░ a rationalisation in private ░░░░░░░░ deals I mean you ░░░░░░░░ back to say 20 ░░░░░░░░ time period a lot ░░░░░░░░ them are debt finance ░░░░░░░░ are looking at most ░░░░░░░░ in 50 50 between ░░░░░░░░ and debt So that ░░░░░░░░ greater reliance on equity ░░░░░░░░ I think 10 year ░░░░░░░░ know I look tenure ░░░░░░░░ being roughly in line ░░░░░░░░ call it GDP So ░░░░░░░░ think most forecasts would ░░░░░░░░ the 10 year coming ░░░░░░░░ at about four and ░░░░░░░░ half to five as ░░░░░░░░ look out you know ░░░░░░░░ were about the GDP ░░░░░░░░ coming in for the ░░░░░░░░ number coming in tomorrow ░░░░░░░░ s going to come ░░░░░░░░ That probably very close ░░░░░░░░ a three handle as ░░░░░░░░ were saying So I ░░░░░░░░ most private equity firms ░░░░░░░░ thinking and recognizing the ░░░░░░░░ are going to be ░░░░░░░░ this four and a ░░░░░░░░ four and a half ░░░░░░░░ five handle on the ░░░░░░░░ year And I think ░░░░░░░░ private firms are expecting ░░░░░░░░ m a activity is ░░░░░░░░ to pick up And ░░░░░░░░ are the two factors ░░░░░░░░ we about making bets ░░░░░░░░ where markets are going ░░░░░░░░ be on a one ░░░░░░░░ five year horizon we ░░░░░░░░ look at public equities ░░░░░░░░ valued we ll look ░░░░░░░░ private equities because of ░░░░░░░░ these pressures and issues ░░░░░░░░ undervalued This is time ░░░░░░░░ think about that that ░░░░░░░░ Gaurav where specifically the ░░░░░░░░ equity space are you ░░░░░░░░ is it is datacenters ░░░░░░░░ it technology inevitably or ░░░░░░░░ you consider what we ░░░░░░░░ from alphabet possibly across ░░░░░░░░ space about capex and ░░░░░░░░ rational ization how does ░░░░░░░░ impact the private access ░░░░░░░░ and what you re ░░░░░░░░ at Look think that ░░░░░░░░ that capex move that ░░░░░░░░ with the chip sac ░░░░░░░░ Inflation Reduction Act that ░░░░░░░░ likely to run for ░░░░░░░░ years We re not ░░░░░░░░ concerned about marginal slowdown ░░░░░░░░ And there we re ░░░░░░░░ this for the long ░░░░░░░░ And we do like ░░░░░░░░ data centers We do ░░░░░░░░ we do like infrastructure ░░░░░░░░ that looking at utilities ░░░░░░░░ almost all aspects the ░░░░░░░░ capex landscape we really ░░░░░░░░ And just keep in ░░░░░░░░ that as you think ░░░░░░░░ construction jobs manufacturing they ░░░░░░░░ gone up dramatically since ░░░░░░░░ both the CHIPS Act ░░░░░░░░ those plants have still ░░░░░░░░ started producing anything Right ░░░░░░░░ there is a lot ░░░░░░░░ to run on on ░░░░░░░░ broad team Gaurav let ░░░░░░░░ bring in the politics ░░░░░░░░ if it is Trump ░░░░░░░░ he is the winner ░░░░░░░░ if he is in ░░░░░░░░ White House and if ░░░░░░░░ is going to rip ░░░░░░░░ the Biden Administration on ░░░░░░░░ CHIPS Act and Inflation ░░░░░░░░ Act or amend the ░░░░░░░░ change some then how ░░░░░░░░ is that going to ░░░░░░░░ the narrative with regard ░░░░░░░░ the data center out ░░░░░░░░ on what we are ░░░░░░░░ to see is I ░░░░░░░░ version of the division ░░░░░░░░ maybe he ll control ░░░░░░░░ and he ll have ░░░░░░░░ White House but he ░░░░░░░░ not have the Congress ░░░░░░░░ I think that some ░░░░░░░░ these things that are ░░░░░░░░ term project that are ░░░░░░░░ in construct and going ░░░░░░░░ I don t think ░░░░░░░░ you can slow these ░░░░░░░░ down or turn around ░░░░░░░░ clock The other thing ░░░░░░░░ keep in mind whether ░░░░░░░░ s a Trump Administration ░░░░░░░░ how this administration both ░░░░░░░░ them want to do ░░░░░░░░ more for manufacturing jobs ░░░░░░░░ them do want to ░░░░░░░░ something for the lower ░░░░░░░░ deciles So either way ░░░░░░░░ see the trend continuing ░░░░░░░░ in the long what ░░░░░░░░ you think about elections ░░░░░░░░ equity markets private public ░░░░░░░░ whatever you look at ░░░░░░░░ tend to move more ░░░░░░░░ that drive those things ░░░░░░░░ I think these trends ░░░░░░░░ t capex are going ░░░░░░░░ be strong for the ░░░░░░░░ term Okay gareth we ░░░░░░░░ pocket that we ll ░░░░░░░░ back to you later ░░░░░░░░ in the program Europe ░░░░░░░░ to implement higher tariffs ░░░░░░░░ China made electric as ░░░░░░░░ concluded its investigation aside ░░░░░░░░ standard 10 car import ░░░░░░░░ The EU will slap ░░░░░░░░ ranging from a 7 ░░░░░░░░ for Tesla to 35 ░░░░░░░░ for China s saic ░░░░░░░░ are expected to kick ░░░░░░░░ this week Beijing saying ░░░░░░░░ move will damage China ░░░░░░░░ China has been back ░░░░░░░░ its own tit tat ░░░░░░░░ into EU branding dairy ░░░░░░░░ pork imports Get back ░░░░░░░░ gaurav malik palace capital ░░░░░░░░ Gaurav have you got ░░░░░░░░ take on international markets ░░░░░░░░ that really seems to ░░░░░░░░ this tug of war ░░░░░░░░ between China and embarking ░░░░░░░░ this massive stimulus program ░░░░░░░░ the one side and ░░░░░░░░ and Japan on the ░░░░░░░░ side which have been ░░░░░░░░ favourites amongst Global funds ░░░░░░░░ know we still prefer ░░░░░░░░ and Japan relative China ░░░░░░░░ think that the policy ░░░░░░░░ that are needed in ░░░░░░░░ to stimulate consumer demand ░░░░░░░░ still didn t see ░░░░░░░░ the current stimulus it ░░░░░░░░ still going back to ░░░░░░░░ fashioned old fashioned investments ░░░░░░░░ hard assets Unless the ░░░░░░░░ starts occurring the consumer ░░░░░░░░ confidence is money into ░░░░░░░░ assets It s difficult ░░░░░░░░ see this rally going ░░░░░░░░ in lasting We do ░░░░░░░░ the dynamics on a ░░░░░░░░ term basis with both ░░░░░░░░ and with Japan the ░░░░░░░░ to shareholder friendly policies ░░░░░░░░ Is a beneficiary of ░░░░░░░░ know supply chain reconfiguring ░░░░░░░░ continues to be a ░░░░░░░░ quality with still very ░░░░░░░░ consumer demand looking really ░░░░░░░░ quite nice off and ░░░░░░░░ a kabuki theater that ░░░░░░░░ going on in Japan ░░░░░░░░ political undermine detract from ░░░░░░░░ longer term investment thesis ░░░░░░░░ Japan Japan Again it ░░░░░░░░ a little bit like ░░░░░░░░ question about about the ░░░░░░░░ right that these things ░░░░░░░░ short term impacts to ░░░░░░░░ but as you sit ░░░░░░░░ and look at know ░░░░░░░░ three year horizons equity ░░░░░░░░ to move more with ░░░░░░░░ and with how shareholder ░░░░░░░░ are and those I ░░░░░░░░ t see changing so ░░░░░░░░ can imagine the kind ░░░░░░░░ volatility is as high ░░░░░░░░ as we expect it ░░░░░░░░ around election season then ░░░░░░░░ the us But don ░░░░░░░░ see it lasting for ░░░░░░░░ long long gaurav I ░░░░░░░░ to ask here correlations ░░░░░░░░ know we re seeing ░░░░░░░░ odd things happen right ░░░░░░░░ dollar and gold which ░░░░░░░░ usually they move in ░░░░░░░░ directions They re tracking ░░░░░░░░ way right now dollar ░░░░░░░░ so is gold that ░░░░░░░░ obvious Right The other ░░░░░░░░ broken down is oil ░░░░░░░░ yields there moving in ░░░░░░░░ opposite direction How do ░░░░░░░░ see correlation is right ░░░░░░░░ and how strong need ░░░░░░░░ there for uncorrelated returns ░░░░░░░░ alpha there is a ░░░░░░░░ need for uncorrelated returns ░░░░░░░░ know to some extent ░░░░░░░░ you think about equity ░░░░░░░░ bond markets by themselves ░░░░░░░░ does act as a ░░░░░░░░ of a hedge in ░░░░░░░░ area and we do ░░░░░░░░ and keep it in ░░░░░░░░ in our pool of ░░░░░░░░ but increasingly we have ░░░░░░░░ turning back and looking ░░░░░░░░ all assets so funds ░░░░░░░░ again looking at some ░░░░░░░░ in private credit equity ░░░░░░░░ can at least us ░░░░░░░░ lower correlation and or ░░░░░░░░ place to hide as ░░░░░░░░ market bond market volatility ░░░░░░░░ out You know ball ░░░░░░░░ you look at economic ░░░░░░░░ bond market most dominantly ░░░░░░░░ wall has been very ░░░░░░░░ high So looking at ░░░░░░░░ assets know is where ░░░░░░░░ would I think a ░░░░░░░░ place for investors look ░░░░░░░░ and again for us ░░░░░░░░ tend to be gold ░░░░░░░░ these these aren t ░░░░░░░░ last thing mention in ░░░░░░░░ of this is that ░░░░░░░░ correlations so highly correlated ░░░░░░░░ with inflation right if ░░░░░░░░ inflation outlook is benign ░░░░░░░░ start seeing more normal ░░░░░░░░ equity and bond yields ░░░░░░░░ other assets But in ░░░░░░░░ period where inflation continues ░░░░░░░░ prey on investor as ░░░░░░░░ ve seen in the ░░░░░░░░ you do see those ░░░░░░░░ up All right gaurav ░░░░░░░░ Excellent talking to you ░░░░░░░░ the time Thank you ░░░░░░░░ keep safe that ll ░░░░░░░░ again very soon Gaurav ░░░░░░░░ there from palace.