RUSH TRANSCRIPT Though Katie ░░░░░░░░ can get her on ░░░░░░░░ technology at 11 00 ░░░░░░░░ M Let s keep ░░░░░░░░ conversation going Nancy it ░░░░░░░░ great to have you ░░░░░░░░ us There are a ░░░░░░░░ of crosscurrents over the ░░░░░░░░ couple weeks really the ░░░░░░░░ couple of hours I ░░░░░░░░ to get your sense ░░░░░░░░ where the rest of ░░░░░░░░ year goes The S ░░░░░░░░ 500 is up about ░░░░░░░░ 5 percent year to ░░░░░░░░ and there is an ░░░░░░░░ note from citi talking ░░░░░░░░ how this might be ░░░░░░░░ good as it gets ░░░░░░░░ do you land Nancy ░░░░░░░░ morning I think that ░░░░░░░░ longer term outlook remains ░░░░░░░░ positive but certainly we ░░░░░░░░ think about being a ░░░░░░░░ more guarded at this ░░░░░░░░ I think it s ░░░░░░░░ to note from a ░░░░░░░░ five years ago February ░░░░░░░░ before the pandemic to ░░░░░░░░ 2025 the S P ░░░░░░░░ up 80 or more ░░░░░░░░ NASDAQ is up over ░░░░░░░░ Bonds are essentially flat ░░░░░░░░ slightly negative While guarded ░░░░░░░░ think that the future ░░░░░░░░ is still positive But ░░░░░░░░ should probably expect the ░░░░░░░░ at this point and ░░░░░░░░ is so much going ░░░░░░░░ that could cause something ░░░░░░░░ unexpected Diversification I think ░░░░░░░░ important Although the S ░░░░░░░░ continues to reach all ░░░░░░░░ highs I m very ░░░░░░░░ that it is showing ░░░░░░░░ little more breadth at ░░░░░░░░ point not all technology ░░░░░░░░ it was the last ░░░░░░░░ of years I would ░░░░░░░░ some guardrails in portfolios ░░░░░░░░ You do expect inflation ░░░░░░░░ come down Nancy Of ░░░░░░░░ we ve just been ░░░░░░░░ the turn of the ░░░░░░░░ so maybe there s ░░░░░░░░ lot of noise in ░░░░░░░░ numbers we are getting ░░░░░░░░ January and even February ░░░░░░░░ how far down do ░░░░░░░░ expect it to come ░░░░░░░░ the Fed going to ░░░░░░░░ able to cut rates ░░░░░░░░ Where do you expect ░░░░░░░░ 10 year You expect ░░░░░░░░ to come down as ░░░░░░░░ Nancy We expect no ░░░░░░░░ than two more rate ░░░░░░░░ in 2025 according to ░░░░░░░░ Powell Inflation is proving ░░░░░░░░ be a little stickier ░░░░░░░░ everyone thought It will ░░░░░░░░ a little longer but ░░░░░░░░ are still adamant about ░░░░░░░░ target of 2 They ░░░░░░░░ thinking that they might ░░░░░░░░ reach that sooner than ░░░░░░░░ The original expectation was ░░░░░░░░ 2026 I think that ░░░░░░░░ are still on track ░░░░░░░░ is a new president ░░░░░░░░ are all kinds of ░░░░░░░░ things going on at ░░░░░░░░ I might add It ░░░░░░░░ difficult for the human ░░░░░░░░ to process all of ░░░░░░░░ and make some sort ░░░░░░░░ the determination for the ░░░░░░░░ term But I still ░░░░░░░░ long term is very ░░░░░░░░ and positive Sonali Earlier ░░░░░░░░ mentioned guardrails on a ░░░░░░░░ If you look at ░░░░░░░░ bond market it s ░░░░░░░░ more volatile than the ░░░░░░░░ market You look at ░░░░░░░░ stock volatility what are ░░░░░░░░ guardrails Is the bond ░░░░░░░░ a haven these days ░░░░░░░░ is it somewhere else ░░░░░░░░ It is one of ░░░░░░░░ certainly The starting yields ░░░░░░░░ proven to be the ░░░░░░░░ predictor of total returns ░░░░░░░░ bonds Today s yields ░░░░░░░░ a strong entry point ░░░░░░░░ longer term durations Remember ░░░░░░░░ are not coming off ░░░░░░░░ a very low interest ░░░░░░░░ anymore Now it has ░░░░░░░░ raised We had a ░░░░░░░░ more rate increases So ░░░░░░░░ prospects for that are ░░░░░░░░ That would be one ░░░░░░░░ and it is certainly ░░░░░░░░ myriad of alternative investments ░░░░░░░░ would provide some guardrails ░░░░░░░░ We don t have ░░░░░░░░ lot of time left ░░░░░░░░ I want to talk ░░░░░░░░ the cross asset landscape ░░░░░░░░ bond market has been ░░░░░░░░ volatile than stocks but ░░░░░░░░ s a relative statement ░░░░░░░░ you look at the ░░░░░░░░ index of bond volatility ░░░░░░░░ it s closest to ░░░░░░░░ lowest level of the ░░░░░░░░ It feels like the ░░░░░░░░ factor has gone down ░░░░░░░░ you consider the tariff ░░░░░░░░ that seems to be ░░░░░░░░ through the equity market ░░░░░░░░ bond market What do ░░░░░░░░ make of that What ░░░░░░░░ the catalyst driving these ░░░░░░░░ at this juncture Nancy ░░░░░░░░ is essentially uncertainty like ░░░░░░░░ This stock market will ░░░░░░░░ have uncertainty because we ░░░░░░░░ know what will happen ░░░░░░░░ will cause a black ░░░░░░░░ event for example Like ░░░░░░░░ mentioned earlier there has ░░░░░░░░ an enormous amount of ░░░░░░░░ on a daily basis ░░░░░░░░ dizzying speeds to decipher ░░░░░░░░ s going to happen ░░░░░░░░ what is not going ░░░░░░░░ happen is still yet ░░░░░░░░ be determined I think ░░░░░░░░ have to wait and ░░░░░░░░ how this shakes out ░░░░░░░░ with the tariffs We ░░░░░░░░ t know if that ░░░░░░░░ actually going to be ░░░░░░░░ positive or negative They ░░░░░░░░ very different than the ░░░░░░░░ tariffs from President Trump ░░░░░░░░ earlier presidency But we ░░░░░░░░ really don t know ░░░░░░░░ the effects will be ░░░░░░░░ are hoping for better ░░░░░░░░ but not without a ░░░░░░░░ deal of volatility in ░░░░░░░░ meantime Sonali Thank you ░░░░░░░░ your time Coming up ░░░░░░░░ will dive into auto ░░░░░░░░ Carvana disappointing Wall Street ░░░░░░░░ of results Details from ░░░░░░░░ next. This is bloomberg.