RUSH TRANSCRIPT Go down ░░░░░░░░ or 2 I think ░░░░░░░░ perception is that things ░░░░░░░░ going to be better ░░░░░░░░ S P 500 and ░░░░░░░░ losing steam As we ░░░░░░░░ the S P still ░░░░░░░░ But we did hit ░░░░░░░░ all time highs again ░░░░░░░░ today Joining me now ░░░░░░░░ top ranked financial advisor ░░░░░░░░ partners Richard Saperstein to ░░░░░░░░ how he s advising ░░░░░░░░ clients When you see ░░░░░░░░ like this at at ░░░░░░░░ record high I know ░░░░░░░░ ve been pretty bullish ░░░░░░░░ invested in equities What ░░░░░░░░ you tell them to ░░░░░░░░ Well the current environment ░░░░░░░░ reinforces the the benefits ░░░░░░░░ holding stocks right now ░░░░░░░░ we have moderating inflation ░░░░░░░░ fed great q2 GDP ░░░░░░░░ earnings next year We ░░░░░░░░ going to have the ░░░░░░░░ of deregulation tax policy ░░░░░░░░ of permitting So stocks ░░░░░░░░ at highs to reflect ░░░░░░░░ lot of the benefits ░░░░░░░░ the investment climate So ░░░░░░░░ clients are fully invested ░░░░░░░░ an overweight in large ░░░░░░░░ technology right now What ░░░░░░░░ what about bonds Well ░░░░░░░░ own municipal bonds We ░░░░░░░░ been buying bonds for ░░░░░░░░ a while And you ░░░░░░░░ on an asset allocation ░░░░░░░░ when clients have stocks ░░░░░░░░ they keep growing and ░░░░░░░░ becomes a larger part ░░░░░░░░ their portfolio there s ░░░░░░░░ point where you have ░░░░░░░░ sell some stocks reallocate ░░░░░░░░ municipal bonds notwithstanding the ░░░░░░░░ that you know the ░░░░░░░░ s up 103 over ░░░░░░░░ last five years and ░░░░░░░░ earnings are up 95 ░░░░░░░░ a little bit stretch ░░░░░░░░ multiples But we think ░░░░░░░░ s an excellent market ░░░░░░░░ own stocks To stay ░░░░░░░░ stocks Absolutely And sector ░░░░░░░░ Well we re long ░░░░░░░░ holders of technology It ░░░░░░░░ very important to be ░░░░░░░░ that sector We re ░░░░░░░░ a in a Paramount ░░░░░░░░ to own technology stocks ░░░░░░░░ re seeing it today ░░░░░░░░ oracle But it s ░░░░░░░░ all technology I mean ░░░░░░░░ of the software stocks ░░░░░░░░ haven t kept up ░░░░░░░░ And look it s ░░░░░░░░ only software There s ░░░░░░░░ lot of peripheral names ░░░░░░░░ the primary data center ░░░░░░░░ So we own as ░░░░░░░░ ve said previously the ░░░░░░░░ power producers They re ░░░░░░░░ great need because we ░░░░░░░░ under electrified in this ░░░░░░░░ And so utilities and ░░░░░░░░ peripheral companies that support ░░░░░░░░ growth of data centers ░░░░░░░░ the electrification of the ░░░░░░░░ are sorely needed right ░░░░░░░░ Yeah I saw the ░░░░░░░░ costs were actually one ░░░░░░░░ the contributing factors in ░░░░░░░░ today and in the ░░░░░░░░ So I guess that ░░░░░░░░ continues around AI data ░░░░░░░░ Yeah Investment So the ░░░░░░░░ we own vistra nrg ░░░░░░░░ companies are generating nine ░░░░░░░░ 11 operating cash flows ░░░░░░░░ re 70 and 30 ░░░░░░░░ companies So they re ░░░░░░░░ but they re redeploying ░░░░░░░░ cash extremely effectively For ░░░░░░░░ vistra is retired roughly ░░░░░░░░ of their float since ░░░░░░░░ started buying it in ░░░░░░░░ So it s a ░░░░░░░░ allocation It s a ░░░░░░░░ play And it supports ░░░░░░░░ the periphery the growth ░░░░░░░░ data centers I noticed ░░░░░░░░ you recently trimmed some ░░░░░░░░ the asset managers to ░░░░░░░░ to technology Was that ░░░░░░░░ about the asset managers ░░░░░░░░ about the AI exposure ░░░░░░░░ So the asset managers ░░░░░░░░ to go because we ░░░░░░░░ we wanted to add ░░░░░░░░ ibm and Amazon So ░░░░░░░░ a fixed amount of ░░░░░░░░ we had to find ░░░░░░░░ you know a source ░░░░░░░░ it Plus the the ░░░░░░░░ managers haven t been ░░░░░░░░ well And you know ░░░░░░░░ want to reallocate to ░░░░░░░░ of a large cap ░░░░░░░░ overweight interesting Ibm is ░░░░░░░░ of the top picks ░░░░░░░░ I often wonder whether ░░░░░░░░ gets credit for the ░░░░░░░░ of expanding AI business ░░░░░░░░ it s built out ░░░░░░░░ t get enough Roughly ░░░░░░░░ of the revenue is ░░░░░░░░ They have 64 billion ░░░░░░░░ in revenue It s ░░░░░░░░ AI infrastructure software play ░░░░░░░░ do AI consulting And ░░░░░░░░ they re coming out ░░░░░░░░ their next gen mainframe ░░░░░░░░ ibm is one of ░░░░░░░░ sleepers that s down ░░░░░░░░ after they announced the ░░░░░░░░ earnings Probably a good ░░░░░░░░ Again peripheral right around ░░░░░░░░ core of data center ░░░░░░░░ And that whole technology ░░░░░░░░ Yeah And a software ░░░░░░░░ but not not necessarily ░░░░░░░░ the same way that ░░░░░░░░ workday is And salesforces ░░░░░░░░ on the on that ░░░░░░░░ So what would make ░░░░░░░░ what would make you ░░░░░░░░ less confident You sound ░░░░░░░░ bullish Yeah we ve ░░░░░░░░ fully invested for a ░░░░░░░░ time What would do ░░░░░░░░ It would be some ░░░░░░░░ know cataclysmic trade war ░░░░░░░░ the tariffs in April ░░░░░░░░ everyone got spooked that ░░░░░░░░ t that didn t ░░░░░░░░ you nervous They ve ░░░░░░░░ tremendously overblown because they ░░░░░░░░ t shown up yet ░░░░░░░░ the inflation I ve ░░░░░░░░ the end of American ░░░░░░░░ capital flight Everyone s ░░░░░░░░ to sell us dollar ░░░░░░░░ But the market got ░░░░░░░░ little jittery for a ░░░░░░░░ For half A minute ░░░░░░░░ Okay But look to ░░░░░░░░ example if inflation comes ░░░░░░░░ higher than expected right ░░░░░░░░ in the market fed ░░░░░░░░ is probably reflected in ░░░░░░░░ prices right now So ░░░░░░░░ know Three cuts this ░░░░░░░░ now is reflected right ░░░░░░░░ So you know if ░░░░░░░░ is a surprise to ░░░░░░░░ upside that could be ░░░░░░░░ tail risk event But ░░░░░░░░ now we re following ░░░░░░░░ Earnings have been growing ░░░░░░░░ flow is very strong ░░░░░░░░ you know that s ░░░░░░░░ s keeping us in ░░░░░░░░ game But do you ░░░░░░░░ about earnings and specifically ░░░░░░░░ which have been strong ░░░░░░░░ the last few years ░░░░░░░░ some of the absorption ░░░░░░░░ the tariffs that that ░░░░░░░░ are going to have ░░░░░░░░ deal with Margins could ░░░░░░░░ impacted The tech margins ░░░░░░░░ running 20 okay The ░░░░░░░░ tech in the S ░░░░░░░░ are 10 so that ░░░░░░░░ why investors should really ░░░░░░░░ about even though these ░░░░░░░░ are selling at high ░░░░░░░░ it s very important ░░░░░░░░ look at margins and ░░░░░░░░ cash flows And they ░░░░░░░░ using all that to ░░░░░░░░ back into their business ░░░░░░░░ take Amazon 163 billion ░░░░░░░░ operating cash flow They ░░░░░░░░ reinvesting 120 billion right ░░░░░░░░ And think about the ░░░░░░░░ of Amazon Whether it ░░░░░░░░ E commerce to distribution ░░░░░░░░ aws the cloud provider ░░░░░░░░ now we have kuiper ░░░░░░░░ they have 100 satellites ░░░░░░░░ airborne moving to 3200 ░░░░░░░░ So they re going ░░░░░░░░ be providing satellite based ░░░░░░░░ as a competitor to ░░░░░░░░ So you know we ░░░░░░░░ the margin expansion and ░░░░░░░░ operating cash flow in ░░░░░░░░ cap tech even though ░░░░░░░░ re at higher multiples ░░░░░░░░ right Well good day ░░░░░░░░ that rich Thank you ░░░░░░░░ much.