RUSH TRANSCRIPT Dream workspace ░░░░░░░░ lecom Strong day for ░░░░░░░░ following another tariff delay ░░░░░░░░ with may almost in ░░░░░░░░ books the question now ░░░░░░░░ to play the markets ░░░░░░░░ the summer Let s ░░░░░░░░ Richard Saperstein He s ░░░░░░░░ partners founding principal and ░░░░░░░░ Welcome back It s ░░░░░░░░ to see you Thank ░░░░░░░░ Speaking of so if ░░░░░░░░ look ahead to the ░░░░░░░░ and we use today ░░░░░░░░ a sort of a ░░░░░░░░ point are we supposed ░░░░░░░░ now by the bark ░░░░░░░░ to speak like by ░░░░░░░░ Trump bark about tariffs ░░░░░░░░ we don t believe ░░░░░░░░ the bite is actually ░░░░░░░░ to happen The bite ░░░░░░░░ happen But it s ░░░░░░░░ for investors to look ░░░░░░░░ the tariff turmoil and ░░░░░░░░ at the environment where ░░░░░░░░ ll have deregulation more ░░░░░░░░ think about the tax ░░░░░░░░ immediate expensing from a ░░░░░░░░ basis greater opportunities for ░░░░░░░░ a so the environment ░░░░░░░░ tariffs will be a ░░░░░░░░ environment for investing Now ░░░░░░░░ between that we have ░░░░░░░░ which could cause a ░░░░░░░░ in the next two ░░░░░░░░ So I think that ░░░░░░░░ doge cuts might have ░░░░░░░░ impact But I would ░░░░░░░░ to the environment post ░░░░░░░░ into 26 versus looking ░░░░░░░░ the immediate volatility So ░░░░░░░░ re looking through all ░░░░░░░░ it Yes That s ░░░░░░░░ you have to invest ░░░░░░░░ this period But what ░░░░░░░░ the back half of ░░░░░░░░ year Are you looking ░░░░░░░░ that too And just ░░░░░░░░ solely thinking about 26 ░░░░░░░░ we ve been adjusting ░░░░░░░░ allocations and we have ░░░░░░░░ cash We still maintain ░░░░░░░░ high equity positions But ░░░░░░░░ you know we ve ░░░░░░░░ purchasing a lot of ░░░░░░░░ bonds still Yeah Still ░░░░░░░░ opportunity is still there ░░░░░░░░ does that what what ░░░░░░░░ that opportunity The rates ░░░░░░░░ below the 10 year ░░░░░░░░ rate Right now it ░░░░░░░░ above the 10 year ░░░░░░░░ rate So you re ░░░░░░░░ over 100 of the ░░░░░░░░ rate in a tax ░░░░░░░░ security Second if the ░░░░░░░░ slows in the back ░░░░░░░░ of this year rates ░░░░░░░░ go down and those ░░░░░░░░ will outperform We re ░░░░░░░░ reducing adding to large ░░░░░░░░ tech because as you ░░░░░░░░ we ve been long ░░░░░░░░ holders of large cap ░░░░░░░░ So I know that ░░░░░░░░ reducing did you did ░░░░░░░░ miscalculate something with small ░░░░░░░░ Do think they re ░░░░░░░░ to do better than ░░░░░░░░ have Yeah You know ░░░░░░░░ we were you know ░░░░░░░░ across the cap table ░░░░░░░░ what we ve been ░░░░░░░░ in the last few ░░░░░░░░ is that small cap ░░░░░░░░ been underperforming probably for ░░░░░░░░ couple reasons meaning a ░░░░░░░░ of companies are remaining ░░░░░░░░ for a longer period ░░░░░░░░ time right now And ░░░░░░░░ then when they go ░░░░░░░░ they re not small ░░░░░░░░ They re they re ░░░░░░░░ billion dollar companies in ░░░░░░░░ large cap space Secondly ░░░░░░░░ small caps that are ░░░░░░░░ very well they re ░░░░░░░░ to become large caps ░░░░░░░░ we finding underperformance in ░░░░░░░░ small caps So we ░░░░░░░░ reducing exposure there We ░░░░░░░░ been gradually doing it ░░░░░░░░ we re actually re ░░░░░░░░ those funds into large ░░░░░░░░ tech Adding to our ░░░░░░░░ mean higher rates are ░░░░░░░░ issue too Right And ░░░░░░░░ s one of every ░░░░░░░░ rates go up Yes ░░░░░░░░ Russell goes down correct ░░░░░░░░ s inversely related to ░░░░░░░░ rates But that s ░░░░░░░░ to say that if ░░░░░░░░ get a slowdown in ░░░░░░░░ economy that s not ░░░░░░░░ for small caps either ░░░░░░░░ So there s good ░░░░░░░░ for us to be ░░░░░░░░ the context of an ░░░░░░░░ asset allocation portfolio reducing ░░░░░░░░ small caps What about ░░░░░░░░ in general I mean ░░░░░░░░ obviously are making the ░░░░░░░░ nervous every time they ░░░░░░░░ to back up Is ░░░░░░░░ still one of the ░░░░░░░░ important things that you ░░░░░░░░ watching Look for the ░░░░░░░░ few months all I ░░░░░░░░ hearing is the end ░░░░░░░░ American exceptionalism capital outflow ░░░░░░░░ crashing rates are going ░░░░░░░░ We re getting tariff ░░░░░░░░ inflation I don t ░░░░░░░░ any of that occurring ░░░░░░░░ no why not If ░░░░░░░░ re a large investor ░░░░░░░░ you re the norwegian ░░░░░░░░ wealth fund where are ░░░░░░░░ going to put your ░░░░░░░░ You re going to ░░░░░░░░ know the size of ░░░░░░░░ stock market is the ░░░░░░░░ of apple So where ░░░░░░░░ you going to put ░░░░░░░░ billion or 250 billion ░░░░░░░░ need the American markets ░░░░░░░░ liquidity And in terms ░░░░░░░░ exceptionalism where is their ░░░░░░░░ The growth is in ░░░░░░░░ States technology stocks Sure ░░░░░░░░ are some around the ░░░░░░░░ but for the most ░░░░░░░░ if you re a ░░░░░░░░ investor and you want ░░░░░░░░ you ve got to ░░░░░░░░ us large cap tech ░░░░░░░░ so then there s ░░░░░░░░ bid under these stocks ░░░░░░░░ the foreseeable future in ░░░░░░░░ because of that for ░░░░░░░░ periods of time Think ░░░░░░░░ this The S P ░░░░░░░░ cash flow is what ░░░░░░░░ 9 the eight stocks ░░░░░░░░ follow in the large ░░░░░░░░ tech space The operating ░░░░░░░░ flow is 5 7 ░░░░░░░░ it s virtually the ░░░░░░░░ as the S P ░░░░░░░░ why not own the ░░░░░░░░ that are growing the ░░░░░░░░ Why don t you ░░░░░░░░ nvidia Why don t ░░░░░░░░ answer your own question ░░░░░░░░ can t own every ░░░░░░░░ out there But come ░░░░░░░░ man that s the ░░░░░░░░ answer when somebody just ░░░░░░░░ it Well why aren ░░░░░░░░ you on that one ░░░░░░░░ because I m I ░░░░░░░░ long a lot of ░░░░░░░░ stocks that are benefiting ░░░░░░░░ data center growth and ░░░░░░░░ And think about you ░░░░░░░░ I ve got a ░░░░░░░░ overweight in some utility ░░░░░░░░ right Yeah And they ░░░░░░░░ vistra and energy and ░░░░░░░░ Yeah the two of ░░░░░░░░ And they ve proven ░░░░░░░░ be very correlated with ░░░░░░░░ center build out which ░░░░░░░░ probably part and parcel ░░░░░░░░ how nvidia is doing ░░░░░░░░ missed nvidia is that ░░░░░░░░ I missed nvidia That ░░░░░░░░ good That s why ░░░░░░░░ was just trying to ░░░░░░░░ you to say it ░░░░░░░░ I missed nvidia I ░░░░░░░░ you up okay Knock ░░░░░░░░ down a little bit ░░░░░░░░ s okay But we ░░░░░░░░ it We get our ░░░░░░░░ share of great allocations ░░░░░░░░ equities You do That ░░░░░░░░ why you re always ░░░░░░░░ the list of