RUSH TRANSCRIPT Bubbles Maria ░░░░░░░░ back Time for if ░░░░░░░░ on Wall Street Top ░░░░░░░░ watching your money Join ░░░░░░░░ now is Brian bendig ░░░░░░░░ senior portfolio manager max ░░░░░░░░ Good to see you ░░░░░░░░ Thank you so much ░░░░░░░░ being here Brian as ░░░░░░░░ look ahead to the ░░░░░░░░ data for the month ░░░░░░░░ November we ve got ░░░░░░░░ ppi out this morning ░░░░░░░░ 8 30 A M ░░░░░░░░ We re expecting a ░░░░░░░░ of 7 and a ░░░░░░░░ percent year over year ░░░░░░░░ we get the consumer ░░░░░░░░ index CPI and the ░░░░░░░░ Reserve s final meeting ░░░░░░░░ the year next week ░░░░░░░░ and Wednesday What are ░░░░░░░░ thoughts What are you ░░░░░░░░ And do you think ░░░░░░░░ of this has been ░░░░░░░░ into the market Thanks ░░░░░░░░ Yes I think a ░░░░░░░░ of the inflation expectations ░░░░░░░░ far coming towards the ░░░░░░░░ of the year have ░░░░░░░░ priced into the market ░░░░░░░░ re expecting about a ░░░░░░░░ decline from last month ░░░░░░░░ ppi or the producer ░░░░░░░░ index and next week ░░░░░░░░ re expecting headline CPI ░░░░░░░░ come down to about ░░░░░░░░ 7s around 7 3 ░░░░░░░░ previously we were around ░░░░░░░░ 7 and this is ░░░░░░░░ dictated by the fact ░░░░░░░░ we are seeing across ░░░░░░░░ parts of the economy ░░░░░░░░ slowing economic environment primarily ░░░░░░░░ to the fact that ░░░░░░░░ know that the Fed ░░░░░░░░ to pump the brakes ░░░░░░░░ economic expansion by increasing ░░░░░░░░ rates and we do ░░░░░░░░ the Fed to increase ░░░░░░░░ rates by another half ░░░░░░░░ percent on December 14th ░░░░░░░░ next year probably still ░░░░░░░░ interest rates but stepping ░░░░░░░░ those rate increases to ░░░░░░░░ series of about 0 ░░░░░░░░ or 25 basis point ░░░░░░░░ and again it s ░░░░░░░░ we re still hovering ░░░░░░░░ inflation levels that are ░░░░░░░░ above their 2 target ░░░░░░░░ next year in yeah ░░░░░░░░ we all want to ░░░░░░░░ what this means for ░░░░░░░░ how to allocate capital ░░░░░░░░ the knee new year ░░░░░░░░ me get your take ░░░░░░░░ aseesing that Yesterday take ░░░░░░░░ assessing that We spoke ░░░░░░░░ Mike Wilson chief investment ░░░░░░░░ at Morgan Stanley Here ░░░░░░░░ what he s doing ░░░░░░░░ now going into the ░░░░░░░░ year Watch this So ░░░░░░░░ for the next year ░░░░░░░░ got to a tough ░░░░░░░░ for the markets Bonds ░░░░░░░░ like they bottomed the ░░░░░░░░ is closer to being ░░░░░░░░ So the Fed by ░░░░░░░░ it s good for ░░░░░░░░ it s good for ░░░░░░░░ Not good for stocks ░░░░░░░░ earnings come down the ░░░░░░░░ will do do 50 ░░░░░░░░ week They maybe do ░░░░░░░░ 25 that s our ░░░░░░░░ and then they cause ░░░░░░░░ don t cut necessarily ░░░░░░░░ year They will cut ░░░░░░░░ if we get a ░░░░░░░░ cycle That s what ░░░░░░░░ re waiting for Maria ░░░░░░░░ will t cut rates ░░░░░░░░ we get a labor ░░░░░░░░ where unemployment goes to ░░░░░░░░ levels Your thoughts in ░░░░░░░░ of what that looks ░░░░░░░░ for nature gets then ░░░░░░░░ Sure Definitely Maria I ░░░░░░░░ the question and the ░░░░░░░░ opportunity to answer many ░░░░░░░░ first of all I ░░░░░░░░ that the Fed what ░░░░░░░░ to change its tone ░░░░░░░░ once the Fed starts ░░░░░░░░ its tone hinting at ░░░░░░░░ a step back giving ░░░░░░░░ time for these rate ░░░░░░░░ to really move through ░░░░░░░░ economy I think that ░░░░░░░░ signal to the markets ░░░░░░░░ we are at thatnd ░░░░░░░░ actually I think stocks ░░░░░░░░ have an opportunity to ░░░░░░░░ on that news Now ░░░░░░░░ do you agree that ░░░░░░░░ over year looks like ░░░░░░░░ are oversold That is ░░░░░░░░ opportunity for next year ░░░░░░░░ we re still tinting ░░░░░░░░ toward dividend paying value ░░░░░░░░ stocks where cash flows ░░░░░░░░ strong margins are protected ░░░░░░░░ looking at a few ░░░░░░░░ of the technology sector ░░░░░░░░ that once we get ░░░░░░░░ the point where we ░░░░░░░░ like the economic slowdown ░░░░░░░░ baked in we actually ░░░░░░░░ the second half of ░░░░░░░░ year could be an ░░░░░░░░ for equities so I ░░░░░░░░ think staying broadly diversified ░░░░░░░░ he focused focus in ░░░░░░░░ portfolios is the right ░░░░░░░░ Mike s right in ░░░░░░░░ sense that earnings still ░░░░░░░░ t fully been adjusted ░░░░░░░░ the outlooks relative to ░░░░░░░░ increases and global demand ░░░░░░░░ around the world Maria ░░░░░░░░ somebody on the program ░░░░░░░░ week said when you ░░░░░░░░ at earnings growth there ░░░░░░░░ none away from the ░░░░░░░░ companies It s all ░░░░░░░░ oil companies and the ░░░░░░░░ beyond that We don ░░░░░░░░ see a lot of ░░░░░░░░ growth that s why ░░░░░░░░ will be coming down ░░░░░░░░ in 2023 Your thoughts ░░░░░░░░ First thank you for ░░░░░░░░ me We think that ░░░░░░░░ s still a little ░░░░░░░░ with the forward looking ░░░░░░░░ They re still priced ░░░░░░░░ roughly 17 times forward ░░░░░░░░ assuming a 225 on ░░░░░░░░ P earnings And we ░░░░░░░░ that s going to ░░░░░░░░ down probably to about ░░░░░░░░ So if you put ░░░░░░░░ 17 multiple on that ░░░░░░░░ think fair value in ░░░░░░░░ short term could be ░░░░░░░░ 3500 again Keep in ░░░░░░░░ that the market is ░░░░░░░░ cap weighted Large technology ░░░░░░░░ still heavily influence the ░░░░░░░░ We re dividend growth ░░░░░░░░ We think there s ░░░░░░░░ lot of opportunity in ░░░░░░░░ areas of the market ░░░░░░░░ it s healthcare auto ░░░░░░░░ whether it s defense ░░░░░░░░ If you look down ░░░░░░░░ the bottom up we ░░░░░░░░ it s time to ░░░░░░░░ in really solid companies ░░░░░░░░ dividends strong balance sheets ░░░░░░░░ that s how you ░░░░░░░░ going to navigate very ░░░░░░░░ market going into the ░░░░░░░░ half of the year ░░░░░░░░ the dividend payers certainly ░░░░░░░░ been the place to ░░░░░░░░ so far with interest ░░░░░░░░ moving the way they ░░░░░░░░ Brian max it s ░░░░░░░░ to see you both ░░░░░░░░ so appreciate your time ░░░░░░░░ come back soon Brian ░░░░░░░░ max thank you gentlemen ░░░░░░░░ break and then explosive