0:01

Welcome to Maren Talks Money, the podcast in

0:03

which people who know the markets explain the

0:06

markets. I'm Maren Suset where this week,

0:08

Jim Read, global head of economics and thematic research

0:10

at Deutsche Bank, joins me to discuss his latest

0:12

research which closely examines how US

0:15

tech stocks have soared so called

0:17

Magnificent seven American tech chants combined

0:19

market cap alone would make it the

0:22

second largest country stock exchange

0:24

in the world. We talk about whether this

0:26

level of concentration should be concerning for

0:28

global stock markets, and of course for you

0:31

I love for my conversation with Jim. Do say

0:33

tuned because Bloomberg columnist John Authors

0:35

is joining me for our weekly debrief. Jim,

0:38

Welcome, Thank you so much for joining us today.

0:41

Thank you pleasure to be here, Right.

0:43

Jim, I want to start with a

0:45

note you wrote recently called everything Poised

0:47

to a soft landing except for history. And

0:50

what I particularly like about this

0:52

piece is the very first slide

0:56

percent of Bloomberg articles mentioning

0:58

soft landing in total articles,

1:01

It says, and then there's a wonderful chart that

1:03

says that we tend to mention soft landings

1:05

a lot. Just before there isn't one. And

1:08

then there's another chart underneath that

1:10

that shows that we love to talk about recessions after

1:12

they've already started, so

1:15

they're not charts that really show us

1:17

journalists in the best of light. So

1:20

I wonder if we could start by talking about

1:22

why it is that we're usually

1:24

wrong about soft landings, and why it is that

1:26

we may well be this time as well, not me,

1:28

by the way.

1:29

Then it's a fun kind of icebreaker

1:32

for the pack. I suppose if

1:35

you think about it, if

1:37

you've got an economy that's operating in a

1:39

relatively normal

1:41

manner and then it overheats, and then central

1:44

banks types and policy to remove

1:47

some of that heat, data

1:50

will soften, and

1:52

therefore as it softens,

1:54

you probably get more and more people talk about

1:57

soft landing, and the news are

2:00

mentioned it spike, and then I suppose

2:02

you've got a question is that the

2:05

final destination or is it just the pathway

2:07

to a harder landing?

2:10

And I suppose the only problem with that graft

2:12

that I put in my piece is that there's only

2:15

thirty forty years of data, so you've only really

2:17

got three or four cycles, and therefore

2:19

you can't base a whole investment

2:21

thesis on it. But it's interesting that before

2:24

the last you know, three or four recessions,

2:27

you have had a soft landing talk

2:29

spike quite aggressively,

2:31

you know, six to eighteen months beforehand. So

2:35

it has happened in those cases. I don't think

2:37

we can say for certain it's going to happen again. But soft

2:39

landing has been all the raised

2:42

in the last two or three months and doesn't necessarily

2:44

mean we have one.

2:45

Well, let's talk about the case for a soft landing.

2:48

I mean that it is definitely the case still

2:50

that most people believe that not just the US, but

2:52

across the board there will be a soft landing. And even

2:54

you know, in the UK recently we have these numbers

2:57

dropping US into a technical recession

2:59

and everyone's said, gosh, don't worry. In fact, even

3:01

a doutsche Bank put out of you saying don't bank, it's

3:03

a short and small technical recession. I there's

3:05

nothing to see here, nothing to see here.

3:08

So what is the case for

3:11

a global soft landing?

3:13

Yep. I think the main case

3:16

probably rests on inflation

3:19

falling rapidly enough and making

3:21

enough progress towards two percent that

3:25

the central banks can cut

3:27

rate just in time to stop

3:29

the lag of policy

3:32

being too threatening to the

3:34

economy. And I think that is the key thing inflation.

3:37

Inflation has fallen quicker than virtually

3:39

everyone expected over the last twelve

3:42

twelve to fifteen months. Let's say even the most

3:44

pullish on inflation probably didn't see

3:46

inflation coming down as quickly as

3:48

it has done so. And I suppose that

3:50

the next point is does it go the last

3:52

mile towards two percent?

3:55

Is always the hardest bit, right, the last mile is

3:58

always the hardest bet. We guessed on

4:00

this show. Over the last year or so, we've looked at

4:02

the history of inflation once it's gone

4:04

to double digits or close to double

4:07

digits, and there are so many experiences

4:09

historically in developed economies of that

4:12

number coming down maybe you

4:14

know, four percent, five percent, but then

4:16

not being able to get through that last bed, and then quite often

4:18

you see you see it rearing its ugly head

4:21

again. So getting down to five

4:23

percent or four percent even feels like

4:25

the easy bit.

4:27

I think that's right. And look, a lot

4:30

of the models do say inflation it's going to return

4:32

to two percent within a reasonable

4:34

time frame, So that would

4:36

be what the soft landing basis is

4:39

based upon, and that's where I suppose

4:42

we can have the biggest debate is that going to

4:44

happen this time or not?

4:46

But that is definitely what the soft landing basis is

4:48

based around.

4:49

But we have slightly lots of confidence in models,

4:51

haven't we, particularly central bank models.

4:54

And I know there's lots of talk about her central bank is in

4:56

the Bank of England in this particular, is going to have a good

4:58

look at their models and improve them and changes,

5:00

etc. But there's not been time for that yet, so

5:02

they're still using the structures that

5:05

have been phenomenally wrong for

5:07

four or five years.

5:09

No, I think that's right, and I think the I

5:12

was shocked at how complacent

5:15

markets were, you know, two three

5:17

years ago about inflation, given

5:19

you've just seen the biggest money supply spike since

5:22

World War Two, And actually, if

5:24

you look at longer term data, you'd have to go back

5:26

about one hundred and fifty years to

5:28

the late nineteenth century to see a spike

5:31

in money supply bigger than the one that

5:34

we saw in COVID. So you

5:36

know, anybody who's got any kind of monetarist

5:39

leanings that had to

5:41

have brought proper inflation.

5:44

So yeah, the market and the

5:47

markets central banks hadn't really

5:50

covered themselves in glory on inflation in the last

5:53

handful of years, So you know, one

5:55

has to take that into account when you think about

5:57

predictions of inflation.

5:59

Yeah, do you have monagorist leanings, because if

6:01

you do, you have to believe that inflation is going

6:03

to continue on its way down, right, because we've seen one

6:05

of the sharpest sharpest contractions

6:07

in money supply in a long time.

6:09

Yeah, And I would say

6:11

that my biases are that inflation

6:14

is a monetary phenomena.

6:16

It's probably a slightly more complicated than

6:19

that. And I suppose one of the interesting things

6:21

at the moment is whether you the stock

6:23

versus the flow. So if

6:27

you were making a case that inflation might linger

6:29

a little bit longer, you would probably

6:31

say that the stock

6:33

of money in the system is still big enough.

6:36

You know, from that massive helicopter drop

6:38

till or three years ago, that even though

6:40

the flow of money is now contracting,

6:43

so money supply numbers are negative most

6:45

of the across most of the important parts of the

6:47

world, maybe that stock

6:51

of money, that reservoir of money from

6:53

the huge stimulus is still there. Kind

6:55

of around around the

6:57

system. So that's where it's confusing, and that's stock

7:00

versus flowing.

7:02

Yeah, and we keep thinking that people's savings are going

7:04

to run out, that that stock is going to disappear,

7:06

but it doesn't, does it.

7:08

No. Actually, in the US, where we probably

7:10

spent a bit more time analyzing this before

7:13

the revisions to GDP in September,

7:15

they do annual benchmark revisions. We

7:17

thought that the stock of excess savings would

7:19

run out by the end of last year, so you

7:22

know, six weeks ago. But with

7:25

the revisions that were seeing our cautpulations

7:28

meant that xcess savings had another

7:31

year, So that that again might

7:33

be one of the reasons why we

7:35

haven't had a recession yet

7:37

because there is that stock of excess

7:40

savings that lingers from

7:42

from the pandemic stimulus.

7:44

Yeah, and the labor market's still strong

7:47

pretty much everywhere.

7:48

Yeah, I mean, the labor market is a lagging indicator,

7:51

so one has to be careful. But

7:53

at the moment that another

7:55

big I suppose what most people who believe in

7:57

the soft land in the

8:00

police degree think is that, you

8:02

know, the miracle has been the central

8:04

banks have put the biggest hiking

8:06

cycle in forty years into the system

8:10

and it's dealt with inflation

8:12

and has had no consequence on unemployment,

8:15

and that you'd have to say that's true. But is

8:18

whether unemployment is a lag

8:20

and indicator or not on history says

8:22

it is, so you shouldn't take too much from

8:25

that.

8:25

And are they forgetting the believers

8:27

in self landings just how long the lag

8:29

of monetary policy can be. You

8:32

know, everyone for the last couple of

8:34

years has behaved. Is that central banks put up

8:36

interest rates, and that's that it happens immediately,

8:38

But in fact the lag is always very long

8:41

and conceivably could be longer in

8:43

this cycle because of the way people fix their

8:45

debt during the very low interest rate period.

8:47

Right, yeah, And I mean we did

8:49

a look at the last

8:52

thirteen US hiking cycles

8:54

over the last seventy years, and

8:57

apart from the Vulka FED INDIUCED

9:00

recession in the early eighties, the

9:02

earliest a recession that started

9:05

after the start of a FED hiking cycle

9:07

is nineteen months. I should

9:09

probably rephrase that and say, now the thirteen cycles,

9:12

the Volka recession happened eleven

9:14

months after the start of the hiking cycle, but

9:17

the next earliest was nineteen.

9:18

Months, okay, and that would take us to when

9:21

that.

9:22

Would have taken us to October last year, So a

9:25

very early recession would have happened in Q

9:27

four of last year basically. And

9:29

I suppose, well, if you look at history, a

9:32

lot happened kind of between

9:35

of nineteen and thirty months,

9:37

if that makes sense, from the initial hiking

9:40

cycle dark date. And that means that we're

9:42

kind of in that window. Okay, we're in that window

9:45

now effectively. Yeah,

9:47

this is where history would say, you

9:49

know, kind of sniper's alley of

9:52

recessions from a historical

9:54

point of view, is it's more probabilistic.

9:57

And actually, the interesting thing is, twelve

9:59

months ago, most

10:01

of the most analysts were thinking you'd get

10:03

a recession within you know, we were in

10:05

a recession, all close to it at that point, and that would

10:07

have been very early historically. Yet

10:10

nobody now is that worried, even though

10:12

now probabilistically you're

10:14

at more risk, okay.

10:16

And how worried are you when you when you

10:18

when you say, well, this is happening. Look at history,

10:21

we always talk about soft landings. These

10:23

this kind of soft landing data is no different

10:25

to how it's been in the past, just

10:27

before something nasty happens. How

10:30

worried are you about the nasty.

10:33

If I'm being completely honest, that's.

10:35

What I'm after, completely honesty, John,

10:37

the whole way through.

10:39

Only only between you and us. Tell anybody

10:42

else.

10:42

Won't tell anybody else.

10:44

Absolutely, if I'm being really honest. We

10:46

got the inflation call spot on. We

10:49

were very early on it. We got the bed call

10:51

spot on. We thought they would move it very aggressively

10:53

before anybody else. We've got the recession

10:56

called wrong so far. I

10:59

thought you'd been a recession by the end

11:01

of twenty twenty three,

11:03

so you know, a couple of months ago. So

11:06

I you know, I have to be I

11:08

have to look at you know, the things I've looked at and

11:10

think whether they're still valid.

11:14

I would say the thing that has probably

11:17

prevented a recession most has been

11:19

the excess savings in the system and

11:21

the fact that companies and entities

11:24

probably have less borrowing these than

11:28

maybe they would normally have at this stage of

11:30

the of the cycle. Now both

11:32

can't last forever, so excess

11:35

savings, even if we revised

11:37

our forecast based on the

11:40

revisions, they probably

11:42

will run out by the end of this

11:44

year, and you know, for most consumers sooner

11:46

than that, and there is a refi

11:49

wall coming in leavered

11:51

credit in commercial real estate, and

11:53

therefore that I think again the soft landing

11:55

narrative probably does need

11:58

the FED to be cut in rate this year

12:02

to just about get us over the line

12:05

before we have more difficult times ahead.

12:07

So we thought you'd be in a recession and

12:10

you're not. A history would

12:12

say that the risk is still going to be there

12:15

for probably the next year. And I suppose

12:17

the question is can the FED cut rates

12:20

quick enough and aggressive aggressively

12:22

enough that you get back to a more

12:24

normal kind of monetary position before

12:27

an accident happens.

12:28

That sounds like a really nasty situation, because if

12:31

we agree that inflation is still looking

12:33

a bit dicey, and we agree that it may be, as

12:35

you say, the stock rather than the flow that is

12:37

keeping inflation a little higher and more volatile

12:39

than people expected, then it gets very

12:42

hard for central bank. Is maybe

12:44

not so hard for the FED with its dual manddate, but certainly

12:46

hard with the legs of the Bank of England to

12:49

start cutting rates in time

12:52

for this to happen. The way you describe it, it sounds incredibly

12:54

precise. And one thing we do know is that monet people, I

12:56

see, it's very hard to make it precise for it, particularly

12:59

in this environment.

13:00

The way I think about it is that in

13:02

this last you know, three

13:06

four years or so, you've had two forces

13:09

in the opposite directions of just

13:12

once in a lifetime size. So you

13:14

have the kind of the once in the lifetime increase

13:16

in the money supply on

13:19

one side, which was ginormous around the

13:21

world, and then followed

13:23

by, you know, the biggest

13:26

hike in interest rates in forty

13:28

years and the biggest contraction in money supply for

13:32

the best part of eighty eighty years.

13:34

And to think that they can be perfectly

13:37

calibrated to kind of slowly

13:41

drift you back to two percent inflation and

13:44

two percent growth, it's not impossible,

13:46

but given the lag of policy,

13:48

that would also require a lot of good fortune,

13:50

I think, and the deutsch Bank house viewers

13:53

moved to a soft landing has been our

13:55

central case scenario, and that

13:58

clearly looks like like the

14:00

most likely scenario at the moment. But I would say that

14:03

probably the tails of that distribution are bigger

14:06

than the market expects. So you know, the

14:08

no landing scenario is probably a higher risk

14:10

than the market inspects. And I still think the hard land

14:12

in scenario probability is probably

14:14

higher than the market inspects.

14:16

Oh, let's talk about the no landing scenario.

14:18

How does that work?

14:20

Well? I think the no landing scenario is

14:23

one where the inflation data

14:26

just stalls enough that the FED either

14:29

can't cut rates, or

14:32

you know, maybe does a cut

14:34

and then has to stop, or even

14:36

contemplates Rizon again. And I

14:39

suppose where that would be an issue is if

14:42

that rates are quite restricted

14:44

now, so if you look at real rates in across

14:47

the world, they're pretty restrictive,

14:50

and therefore, you know, the probablity of an accident

14:52

does what accumulative

14:54

probability of an accident probably increases

14:57

steadily the longer you have rates at these sort

14:59

of levels. That's probably the risk of a no

15:01

landing.

15:02

Is there an argument that the central

15:04

banks are loathed to cut interest rates

15:06

because they're actually quite keen to get rates

15:08

back to long term historical levels. When

15:11

I say long term historical, I mean sort of five thousand year

15:13

levels rather than twenty year levels.

15:15

And so in an ideal world, they'd like

15:17

to be able to stay up at four percent or

15:19

so.

15:20

I suppose the way I like to

15:22

think about it is more from the

15:25

angle that you know, if you listen to central

15:28

bank speak, you're never more than

15:31

a few days away from a central banker

15:33

mentioned in the nineteen seventies trying

15:35

to ensure that we

15:37

don't repeat the mistakes of the nineteen seventies.

15:39

I mean the Unfortunately, the Arthur Burns

15:42

bed is not particularly

15:44

not held particularly well in academic

15:47

and central bank circles, and therefore

15:49

most central bankers really don't

15:51

want their legacy to be that they also

15:54

made similar errors. So I think on balance,

15:57

the central bank's probably main priority

16:00

is not to ease

16:03

too early. Doesn't mean to say that their priority

16:05

is not to ease if

16:07

the data is there.

16:10

I think, ingrained, it's almost like every

16:12

central banker has been to the virtual

16:15

nineteen seventies open university

16:17

course. They don't want to be seen to be making the

16:19

same mistake. And I think the

16:22

central banks have been saying this, but the

16:24

markets kind of between October

16:27

and January weren't listening to them

16:29

and didn't believe them. And I think in the last

16:31

you know, last two or three weeks, the

16:34

markets have kind of stood up and kind

16:36

of taken a little bit of that warning.

16:39

So there's a bit more balance in market pricing

16:42

now. But yeah, central banks, I mean, if

16:44

the US inflation data of the

16:46

last week isn't a one off, then

16:50

that seriously raises the question of whether

16:52

the BED can start

16:53

an easy in cipher law.

16:56

If they do start, how you know, they

16:58

probably wouldn't get very far in.

17:00

Saying And everyone I'm talking to at the moment about

17:02

various things is where everyone's listening to the same The

17:04

Rest is History podcast about the nineteen seventies,

17:07

right literally, it's at the forefront

17:09

of everyone's minds, and I reckon central bankers

17:11

are probably listening to that as well and thinking

17:13

to themselves, God, and the last thing I want to be is

17:15

one of the central bankers. You've got it wrong, particularly

17:17

haven't got it so wrong for the last four or five

17:20

years. Everyone wants to be remembered as a vulgank

17:22

lot of burns, and that may have impacts

17:24

for all of us.

17:25

Yeah, listening to the central bankers,

17:27

they're remaining on the

17:31

courtious side in terms of rate cuts.

17:34

I suppose what market will still

17:36

choose to ignore them if they believe that they have

17:38

a better insight into the data. But we've

17:40

probably moved a bit more in balance in the last few

17:42

weeks.

17:43

Yeah, okay, let's look at what

17:46

this idea that we're moving from a

17:48

into a soft landing scenario has

17:51

meant for markets.

17:53

Now, you wrote recently about the Magnificent

17:55

Seven, the Seven, the seven companies

17:58

in the US there are effectively driving US

18:01

markets, and in driving US markets, driving

18:03

global markets because the US is such a big

18:05

component of the global market. So we have these

18:08

seven companies that are basically

18:11

the drivers behind our pensions,

18:14

our ices, our assets.

18:17

What is going on with them? The US market is

18:19

now what nearly as concentrated as has ever

18:21

been in history, with these big companies taking

18:23

up most of the market, and time after time

18:25

after time we look at them, we say, this can't go on.

18:28

This is ridiculous. This never ends

18:30

well. But maybe it is going to end well.

18:33

What the first thing to say is I wish I did have them in

18:35

my eye, says I, with all

18:37

due respect, I wouldn't be speaking to you. I'd be on the beat

18:40

if I'd.

18:40

Have had you must have some of them

18:43

in your I say you must have a nice global tracker

18:45

or something, and Deutsch you must have given

18:47

you a nice pension which ought to enroll

18:49

you into some lovely US trackers.

18:51

Surely, maybe in those decisions that

18:53

I haven't had anything to do with, maybe there's

18:55

a little bit in the back

18:57

burner.

18:58

That's how it works for me as well, Jo, if I've got any

19:00

It's not a decision I made.

19:02

Yep, sadly, sadly for both of us. Look,

19:06

I think they are

19:08

astonishing in terms of their

19:10

size and their breadth. So the

19:13

US market is pretty much

19:15

the most concentrated it's been in history,

19:17

really, very similar to the where

19:19

it was in nineteen twenty nine in

19:21

terms of the weight of let's

19:24

say the top five constituents.

19:27

So top five make up about

19:29

twenty five percent of the market now, so that's

19:31

as big as it has been in

19:34

history. And look, as an economic

19:36

historian, I have

19:38

a bias to believe that

19:41

this is nonsense and doesn't make

19:43

sense and is warning

19:45

of us of a more difficult time

19:48

to come. Yeah, I suppose this is where you've got

19:50

to be slightly careful of history,

19:52

because we've probably never had a

19:55

situation in history where the

19:57

companies that make up that top five

19:59

per or a Magnificent seven, et cetera,

20:02

make as much money already. You

20:04

know, this isn't like two thousand, where there

20:06

was a lot more speculation

20:08

in companies that weren't profitable.

20:11

And just you know, a stat to throw

20:13

out out at you. If

20:15

the Magnificent seven were a stock market

20:17

on their own, if you exclude the US,

20:19

there'd be the third biggest stock market in the world

20:22

by profitability, so only

20:24

China and Japan would be ahead

20:27

of them.

20:27

Yeah, and they'd be the biggest by market cap.

20:29

I saw as well in your work. So they

20:31

would be that those seven alone

20:34

would be in taking out the rest of the US, would

20:36

be the biggest stock market in the world,

20:38

China coming just buying them, Japan to soft

20:40

there than India, France, etc. And then

20:42

you have individual US companies

20:45

Microsoft, Apple, which are bigger

20:48

as single companies in terms of market

20:50

captain than all of the UK markets,

20:53

all of the Canadian market, all of the German

20:55

market. I mean, it's just nuts.

20:57

It is, as I said, my natural inclination to

20:59

say this is crazy, and then you look at how

21:01

much money they make and it's

21:05

still expensive and

21:07

elevated, but it starts to become

21:10

you can start to build a narrative of some discript

21:12

So, for example, the amount of annual profit that Apple

21:15

makes is around sixty percent

21:17

of the entire listed stock market in France.

21:19

Yeah, no, I mean that absolutely extraordinary. I've got I've

21:22

got your chart in front of me, which

21:24

so if you look at it in terms of billions

21:26

for the profits Apple one hundred

21:28

and one, all of the UK,

21:31

all of it, two hundred and seventeen,

21:34

all of Canada one thirty six, all

21:37

of Germany one eighty eight, and then

21:40

you go to alphabet Alphabet, Alan seventy

21:42

four, Amazon alone thirty, etc.

21:44

Matter alone, though, it was absolutely extraordinary

21:47

how successful these companies are.

21:49

And as you say, once you start to look at it like

21:51

that, maybe these valuations

21:54

are.

21:54

Okay individually within the

21:56

seven there may be some that are look

21:59

a little bit more stretched than others. But I mean,

22:01

if you're talking about, you know, the lights of Apple

22:03

and Microsoft, you know these are very

22:05

profitable companies that probably will stay

22:07

profitable for a period of time. I'm

22:10

not a micro analyst, and I don't

22:13

understand the wizards,

22:15

et cetera. But I

22:17

would say as a minimum that these aren't

22:19

uber crazy valuations. It's just whether

22:21

you think that they are rich or

22:24

not.

22:25

Well, they are still high. I mean, if you look at the average

22:27

of this even again I'm looking at your chart,

22:29

the average trailing pee

22:32

for those seven stocks is thirty seven times.

22:34

I mean, it is high. It's not one hundred.

22:36

You know, this is not Japan in the middle of its great bubble,

22:38

but it's still high. And then you know, the

22:41

most expensive Nvidia on ninety. And

22:43

then you come back to the UK as a whole and

22:46

it's got an average pe

22:48

of seventeen. So they're

22:50

expensive, but not as expensive

22:52

as we've seen in previous bubbles.

22:54

Yeah, I think that's probably the

22:57

way to put it. And I suppose if you were trying to put it

22:59

into a historical context as

23:01

well, in this era

23:03

we live in today, we

23:06

probably have more globalization

23:09

that allows companies

23:11

to cross borders, maybe even more than it was let's

23:13

say the nifty fifty or obviously

23:15

people are talking a lot about the nifty fifty in the late

23:18

sixties early seventies, although

23:21

the company's sold products around the world, the

23:23

world was much

23:25

more localized back then, so you

23:27

know, Kodak, for example, although

23:30

it was a global company, wouldn't have the same

23:32

kind of global presence as some of the Magnificent

23:35

Seven. Today,

23:38

the Internet has also kind of been

23:40

a global phenomena, and therefore,

23:43

you know, the Lights and Magnificent seven can

23:45

access global consumers

23:47

in a you know, a press of a button

23:49

in the way that maybe we couldn't have done fifty

23:51

years ago, one hundred years ago, et cetera.

23:53

So the world has changed a little

23:56

bit to allow dominance of

23:58

individual companies more than they

24:00

would have in the past. But it's just what price

24:03

or you want to pay for that.

24:04

Yeah, and there is risk. And we talk about globalization

24:07

being one of the big drivers behind these companies,

24:10

and of course it has been, but one of the things we're looking

24:12

at now is a degree of deglobalization.

24:14

And it's never going to happen as fast as some people believed

24:17

it would. But this is not the world of

24:19

five years ago. It's a very different

24:21

world. And there are a lot of governments out there that are

24:23

increasingly controlling the Internet and increasing

24:25

they want to control the way these big companies

24:28

operation, in particular control their

24:30

profits and how those profits are taxed

24:33

and to control the information

24:35

that they can carry or not carry. So there's still

24:38

a lot of risk there when you think about

24:40

geopolitics, right.

24:41

Yeah, I know, and it's a good point. And

24:44

look, if you think about markets,

24:46

I mean, we make the point in the report that the

24:48

top five biggest companies over in

24:51

the US, for example, do change over time

24:54

and in fairly unpredictable ways that you

24:56

wouldn't have known maybe five ten years in

24:58

advance. They tend to be quite stable

25:00

in the short term, but quite they

25:03

move quite a bit in the medium term, if that makes sense.

25:05

So you know, the top five biggest

25:07

companies in ten years may be

25:09

a completely different cohort and because

25:12

of things that we don't know yet. So we don't

25:14

know if globalization is going to really

25:16

cause a kind of a schism

25:18

in the world order at some point in this decade.

25:21

You know, we don't know if there's a new

25:23

silver bullet that's going to come around that makes

25:26

some of the technologies redundant. We

25:28

just don't know, and that's part, you know, part of investing

25:30

is obviously trying to lean

25:33

against things that you don't

25:35

know if the price is

25:38

probably the wrong price, and that's

25:41

a feel that probably helps you in the long term,

25:43

but doesn't necessarily help you in the short term.

25:45

Yeah, shorter term though, I suppose we could

25:48

say that these are all growth companies. So

25:50

it is the expectation that

25:52

rates will fall reasonably soon that it's

25:54

been one of the drivers. I mean, obviously as AI

25:57

and this kind of thing, But it's

25:59

also so the idea that

26:01

rates will fall, and there's obviously give for growth

26:04

companies. So if we do see

26:06

rates not falling as expected, may

26:08

we see a sudden turn in the Magnificent

26:11

seven or is that too simplistic?

26:13

Well, I think if you'd have said that to me six,

26:16

nine, twelve months ago, I would have agreed.

26:18

But we've had some concern

26:21

about rates in the last month

26:23

or so, and actually it's the smaller stocks

26:25

that have suffered, So the Russell two thousand,

26:28

it's been much more sensitive to

26:31

the rate volatility

26:33

that we've seen in the last few weeks, whereas the Magnificent

26:36

seven have just powered on. So it

26:38

seems like, you know, the Magnificent

26:41

seven investors are saidler, under any

26:43

macro scenario, now we think these

26:45

are going to win. But if the

26:47

FED is going to raise rates, that's

26:49

not very good for the small caps in the US,

26:52

etc. So I think your proposition

26:54

is a fairly sensible one. But in recent

26:57

weeks, in recent months, it seems to be the

27:00

they are decoupling from that rate

27:03

expectation. Now, whether that can last is a

27:05

moot point. But for now they are Yeah.

27:08

So basically recovered from everything.

27:10

They've moved into their own little world, beyond

27:12

our world.

27:13

Beyond our comprehension, a bit like AI

27:15

that they are. Yeah, they have

27:18

superior intelligence to us.

27:20

I think, Okay, so you're not going to rush

27:22

out after US chat and buy more abusing

27:24

things for your ISA. Sorry, some of these

27:26

things for your ISO?

27:27

I am confused about it. In

27:29

doing this report, I've really

27:32

learned how great these most

27:34

of these companies are. I genuinely,

27:36

you know, I've been doing this job a long time and I look at

27:38

these stops as a macro man all the

27:40

time. But I genuinely learned a lot

27:42

about how great these companies are from

27:45

a profitability basis,

27:47

and it was really instructive to compare that

27:49

to whole countries stock markets.

27:51

Mate, whether I want to pay up for that, I'm

27:54

always somebody likes to see a bargain rather

27:56

than pay up for something on

27:58

the expensive side, if that is the wrong

28:01

trade, I tend to try to be a bit of a bargain

28:04

hunter.

28:04

Yeah, I'm with you there, Jim, and look and look what that's

28:06

got. I say, absolutely,

28:09

Let's talk about other markets then. I

28:11

mean, one of the things that we can see so clearly in

28:14

your chance about the Magnificent Seven is

28:16

just how lonely some of these European

28:19

markets, in the UK market in particular, are

28:21

valued at the moment relative to the US

28:23

market. I mean, obviously, if you take the Magnificent Seven

28:25

out of the US market, it's not nearly

28:28

as expensive as it is with them included, but

28:30

nonetheless there's still a US premium

28:33

in there. And when we look at the UK,

28:35

which we do relentlessly on this podcast,

28:37

because John and I are both both have a value

28:39

by us that we can't shake. When

28:41

we look at the UK, we keep thinking, well, surely that

28:43

that's the place to be, that's the place to be. Is

28:46

that a market that looks attractive to you.

28:48

Are someone likes of value, then it's

28:50

hard to say the UK is bad

28:53

it's bad value. I do think there's a legacy

28:56

problem. I think there's a fair proportion

28:58

of international investors that have kind of sides

29:00

that the UK post brexit, and

29:03

that has left the

29:06

market relatively cheap.

29:08

I spoke the one thing you say about the UK. I've

29:10

talked at length about how concentrated

29:13

the US market is, but I just looked actually

29:15

earlier, the top five names in

29:17

the foot see make up about thirty two percent

29:20

of it. So I approcate that's the

29:22

PUTSI one hundred rather than the S and P five

29:24

hundred, So not quite the same, but it is.

29:27

The UK market has always been concentrated to

29:29

kind of banks and commodities, and therefore

29:31

that there is a little bit of healthcare and there they're

29:34

obviously a little bit of what goes on in those

29:36

sectors probably overrides things.

29:38

But do you think that the numbers coming out of both

29:40

Europe and the UK are beginning to suggest

29:42

a foreign investors that, well, the UK isn't

29:45

exactly in the best of health. There's no

29:48

obvious indication in

29:50

the numbers that we're doing significantly worse than

29:52

the rest of Europe. So at some point you have to

29:54

look at it and say, well, I need to I need to get over

29:57

myself about this Brexit business and just look at

29:59

things as they are.

30:00

I definitely think you're seeing that a little bit from my conversations

30:02

I have with people around the world.

30:05

It probably needs a bit of momentum to

30:07

get it going. It's a bit like M and A. You know, once

30:09

once you get maybe a couple of big deals for overseas

30:12

companies buying cheap UK

30:15

companies, maybe there'll be a bit more activity.

30:17

And maybe for that you need the interest rate environment

30:19

to be a bit more stable across the

30:21

world. But yeah, I think, look, I think the UK

30:24

market does look pretty good,

30:26

good value. I've always

30:28

liked dividends, and you get quite a bit of dividends

30:30

in the UK market.

30:32

We keep saying to people John and I, you know, there's a lot

30:34

of cheap equities listed in the UK and if

30:36

you don't buy them, eventually somebody else

30:38

will. And you know, here we are with Curries

30:40

Curries earlier this week. Obviously the deal hasn't

30:43

been done yet, but you know it will be

30:45

beginning to see these companies that have done

30:47

nothing but see their share prices fall for years

30:49

and trading on very low valuations with potential

30:52

they are starting to get snapped up. And we

30:54

keep wondering just how many of them have to get snapped

30:56

up before other investors look at the market

30:58

and go, yeah, that'll do me.

31:00

From reading your work, you look at this a

31:02

lot more closely than me, So I would

31:04

bow to your kind of expertise

31:06

here.

31:06

But excellent, that's the kind that's the kind

31:09

of.

31:09

Guest we like. Yeah,

31:11

absolutely, Yeah, from from that corec

31:13

point of view, I wouldn't. I wouldn't

31:16

disagree with the kind of conclusions you come with.

31:18

Yeah, yeah, well, I think I think

31:20

we do keep looking at it, But John and

31:22

I don't entirely agree on that. We'll have to have another

31:24

conversation on that one. I did

31:26

want to ask you about if

31:29

you were, if you were coming into government

31:31

now as a new chancellor in the UK,

31:34

what would you do, given your knowledge

31:36

of economic history and your knowledge of how the UK

31:38

works, what would you do to make things better?

31:41

I think if I was chancellor and

31:44

I came in with a clean

31:47

slate, Look, we're in a difficult situation

31:49

in the decades ahead

31:51

because we do have a

31:54

lot of entitlements

31:57

that we've promised people that

32:00

that means the pressures on the government

32:02

coppers are going to go up and

32:04

up. So I think you have to try to find

32:07

ways of extending people's

32:09

working lifetime in a way that is

32:11

politically tenable. And

32:13

IM not sure I know how to do

32:16

that, but I think to be a success as

32:18

a chancellor you need to try to find

32:20

ways of doing

32:22

that. And I think you probably also need to

32:24

find ways of borrowing

32:27

money that you can invest to

32:29

make the economy better.

32:33

And although I'd like to pay lower taxes,

32:36

maybe maybe that's

32:39

not always the answer. Maybe in some cases it's

32:41

the answer, but you've got to find ways

32:43

of making what are still quite low

32:45

long term real rates work for

32:47

you as an economy. I mean, look, government debt

32:50

borrowing. There shouldn't be one

32:52

hard and fast rules. It probably should be

32:54

how attractive it is to borrow. So in eras

32:56

where rates and real rates are

32:58

very very low, government should be incentivized

33:01

to borrow in ways that

33:03

they can productively increase

33:05

the economy. If rates are high, real

33:08

rates are high, then governments shouldn't you

33:10

know, should be quite proval. So

33:12

I think you have to have an element of flexibility. I

33:14

still think real rates are relatively

33:17

low enough that you can

33:19

borrow more than what

33:22

might look to be prudent if you're

33:24

investing it in the right things.

33:26

Now, listen, there is one thing that I do have

33:28

to ask you about. I do have to ask you about before

33:30

we can finish up here. And I know that neither

33:32

of these things will be your area of expertise, but we don't

33:34

care. We just want an answer. We

33:37

ask everybody if we were

33:39

going to lock them away somewhere for

33:41

ten years, someone nice, By

33:43

the.

33:43

Way, Can I leave my kids at home? Can

33:45

I leave the kids somewhere else? Yes?

33:47

You can. You can, although we're

33:50

the entire audience is already judging you for

33:52

that, but you can.

33:53

You can.

33:54

And then once you're in this lovely place, before

33:56

you go sorry, you have to invest all your

33:58

money in every penny in one

34:01

of two things, either gold or

34:03

bitcoin. And you

34:05

don't have to tell us why you make the choice. You're

34:07

about to make all that as nicer if you

34:09

do. But what would it be?

34:11

Do you think I would say

34:13

gold? And I think the reason

34:15

I would say that. Look, I'm

34:18

someone that's broadly an inflationist.

34:21

As an economic historian, I know that

34:23

inflation is always there because in

34:26

democracies and the election cycles,

34:28

there is always going to be incentive to create

34:31

money, you know, at some point relatively

34:33

soon. Even if the macro models don't suggest there

34:35

will be inflation, there will always be a political reason

34:37

to create inflation, especially

34:39

in a world post Breton Wood

34:41

system where it be it money rules. So I'm

34:44

always an inflationist. So therefore I

34:46

do like things that protect you

34:48

against inflation. Now, to be fair, gold isn't

34:50

a brilliant hedge for

34:53

a lot of history, apart from if you've got inflation,

34:55

So to make gold work, you actually

34:58

do need inflation. Bitcoin.

35:02

I do think that in a

35:04

world where we're moving into

35:07

a digital world,

35:09

there will be kind of some digital demand

35:12

for store value. I

35:14

just don't know if bitcoin is that long term

35:16

winner or whether the regulators

35:19

will deal with it in a different

35:21

way than they have today. So I wouldn't

35:23

say bitcoin is a total disasters

35:27

investor investment. I just don't

35:29

know whether it's the winner, and I don't whether

35:31

know whether the regulators will clamp

35:34

down on it in years to come. I would

35:36

prefer gold, Okay, that

35:39

puts you.

35:39

In firmly in the

35:42

merin Talks Money podcast,

35:44

majority.

35:45

Is that a good thing?

35:46

I don't know. We'll find out when we're in a decade.

35:48

Jim, thank you so much joining us today.

35:50

Very kind, pleasure, lovely

35:52

to be invited. Thank you.

35:59

With me now reflect on what we just heard

36:01

from Dutchbanks. Jim read is fellow Bloomberg

36:03

columnist John Author's John, you are kind to

36:05

join us today.

36:07

It's a pleasure. Now.

36:09

I know that you've known Jim for a long time

36:11

and you've been reading his work for a long time.

36:13

Yes, when you listen to him speaking today,

36:15

did you think to yourself that man is absolutely

36:18

right? I agree with everything you said. Is that

36:20

how you felt?

36:22

I'm not sure I agree with everything he

36:24

says, but in general he's one

36:26

of the people who thinks in a very similar way

36:28

to me, and

36:31

that means that he's occasionally

36:33

been too bearish, just as I have been over

36:36

over the last couple of decades.

36:39

But in general, I think you're in pretty

36:42

safe ground following him.

36:44

He's got an incredibly acute

36:48

sense of history, which I think is always

36:50

very important, and he

36:53

has the rare ability to

36:55

combine big picture

36:58

thinking. What you heard that in this the

37:00

conversation with extremely

37:03

granular nerdy focus

37:06

on on data, and it's unusual

37:08

to have somebody who can who can actually

37:10

do both equally.

37:12

Well, okay, that's a that's

37:15

that's pretty positive.

37:16

Hm.

37:17

Now we talked a lot about something that I've

37:20

written about a lot, and I know you've written about a

37:22

lot, which is the concentration in the US market,

37:24

the Magnificent Seven. And you

37:27

know his statistics on this is just absolutely

37:29

extraordinary. That report on on

37:31

the Magnificent Seven, about them they're

37:33

in terms of market cap and profits being more like

37:35

countries than companies was wonderful. But

37:37

of course it rings every warning bell in the book

37:40

for bears like him and me and

37:42

you. Right, we look at that and we don't go, isn't this wonderful?

37:44

It's going to last forever. We love this. We look at and

37:46

we go, oh my god, this guy's going to fall in.

37:49

Yes, And but we also

37:51

have this painful thought that it's going to it's

37:53

going to look really embarrassing until it turns

37:55

because I just cannot cannot

37:58

justify jumping in at this level,

38:00

and that's going to look bad for a while.

38:03

Well, Jim said that as well, not

38:05

in his ISA.

38:08

Acid happens as it happens

38:11

at the precise moment we are,

38:13

we're recording this about

38:15

an hour after trading started in New

38:18

York on them on Thursday. So my factoid

38:20

for you is, after an hour of trading

38:23

following its results coming out, in Vidia's market

38:25

cap is up something like two

38:27

hundred and forty billion

38:30

dollars. The total market

38:32

cap of Intel is one

38:34

hundred and eighty billion dollars. So

38:37

our response to the

38:40

news the results that in Nvidia

38:42

have announced is to decide that they

38:45

are more than a whole Intel's worth

38:47

more valuable than we thought they were, which.

38:51

And also one of our other colleagues said

38:54

that it was also equivalent to the entire market

38:56

capitalization of Greece.

38:59

That makes sense, which, interestingly,

39:01

according to a chart from Jim

39:04

Reid, Thank you, Jim,

39:06

our hero, Our hero, Greece

39:09

is now now that Japan has

39:11

managed to take out it's all time high. Poor old

39:13

Grease is now in the lead

39:16

for the stock market that's

39:18

gone the longest since its last all time

39:20

high. Interesting, and Greece is cypress.

39:23

Yeah, Greece is going to turn into the measurement of stock

39:25

market units, isn't it? Like Wales is the measurement

39:27

of the scale of everything in the UK. It's

39:29

five wells as two Wales, as one Wales, etcetera.

39:31

We're now going to say it's worth five greases, ten

39:33

greases, forty five greases.

39:35

It's all a little because Greece has hit

39:38

bottom and is now turning into one of the one

39:40

of the safer places to invest in

39:42

Europe, which is just as well after all the pain it had

39:44

to go through to get where it is now.

39:46

But in terms of how far away it is

39:49

from it it's high, and how long ago it

39:51

is, it's got a lot of sledting to go.

39:53

It's yeah, it's in many ways

39:55

comparable to Japan. Anyway, Sorry, Jim,

39:57

Well.

39:57

Let's stick with Japan, because okay, there's not much

40:00

point in us talking much longer about how wonderful

40:02

we think Jim is and how he's absolutely right

40:04

on everything. Goodness me, what a man. So why

40:06

don't we talk about the other thing that

40:08

you and I are both fascinated by, which is

40:10

Japan and the new high

40:13

in Japan, which we've been waiting for a

40:15

long long time. I started my career

40:17

in Japan back when the nicket was roughly

40:19

where it is now, you know, and

40:21

I've been writing for a decade telling

40:24

our readers that you know it's going to turn.

40:26

It's going to turn. It's really it's going to turn. It's definitely

40:28

going to turn. There's a new high out there, and

40:30

now it's finally happened, and

40:32

you wrote a column about.

40:34

Yes, God's right, you wrote a column.

40:36

About this this morning, and

40:38

you think you think this can continue?

40:40

Right?

40:40

Not over yet, Mornia, and I moren

40:42

you highs ahead a new high every day.

40:45

I don't know that I would say that

40:48

this is definitely a more

40:50

solid high,

40:53

more of a foundation for further gains than

40:55

the last one, which is one of the safest

40:57

comments I've ever made in my life.

41:00

This isn't why we ask you on John, I'm going to have to raise

41:02

again.

41:03

So if you want just

41:05

to continue the

41:07

Japanese stock markets their

41:10

part in my downfall or whatever. My first

41:13

ever day at work for the Financial

41:15

Times was January the first, nineteen

41:18

ninety and the nick had

41:20

topped the day before. So

41:22

this is the first all time high

41:25

I have ever witnessed in Japan in

41:28

my thirty four and a half thirty

41:31

four years in financial journalism.

41:33

So yep, this is a this is a very

41:35

big deal. I do think

41:38

in this case What

41:40

matters is that corporate

41:43

Japan has sorted itself

41:46

out in a way that wasn't

41:48

true before in

41:51

terms that Jim Reid would approve of very

41:53

greatly if you, despite

41:55

having been at such

41:58

low levels for such a long time in

42:00

terms of interest rates, there are far

42:02

fewer zombie companies in Japan than

42:05

there are in the States. For

42:08

all that Japan's growth has been slower,

42:12

a lot of Japanese companies haven't

42:14

actually taken

42:17

the opportunity of low rates to just continue

42:20

their existence. There has been

42:23

some degree of necessary

42:25

pain and consolidation, and

42:28

the reforms that really got going over

42:30

a decade ago as part of our benomics to

42:32

improve corporate governance,

42:34

to persuade Japanese companies

42:36

to be nice to their shareholders

42:39

are beginning to have an effect. They're buying back

42:41

stock in a way they've never done before. Their dividends

42:43

are going up. So

42:46

that's on the fairly boring level.

42:48

I do think if you're a value investor,

42:51

if you're caring about the longer

42:53

term, I think Japan still looks like a

42:55

fairly decent bet.

42:57

If we then want to get into the macro surrounding

43:00

central banks, what might happen to the end

43:02

where the Bank of Japan goes next. Then there's all

43:04

kinds of very significant risks you could discuss.

43:07

Yeah, we can talk about that as

43:09

well, but you also put you put

43:11

a lovely chart in your column this

43:13

morning from sock Gen showing that

43:16

projections for two thousand and four two thousand and five

43:19

earnings pur chare have fallen across the world

43:21

with the sole exception of Japan. And

43:24

it's a great short, a great chart because over

43:26

the last however, many decades, every time

43:28

we look at a chart where something about Japan

43:30

is the sole exception, it's been in

43:33

a bad way, all right. So to see

43:35

a chart where it's Japan is

43:37

unique and special, but in a really good way.

43:39

It's kind of exciting.

43:41

Were again, it's this is why we

43:43

don't retire, why we carry on doing our jobs.

43:45

There are actually every so often there's something

43:47

you've never seen before comes up. But yes,

43:50

exactly like the macro trends

43:53

are such that I wouldn't I certainly wouldn't

43:55

say yes, definitely stick with

43:57

the stick with Japan. Fill your boots because there

43:59

are macro risks, But in terms

44:02

of the kind of investing

44:05

that is somewhat out of fashion, but which both of us

44:07

have spent a long, long careers encouraging

44:09

people to do. The

44:12

actual companies you're buying and

44:14

the cash flows they are trying to generate

44:16

for you that you buy when you buy their stock do

44:19

actually seem to be a

44:21

fundamentally much healthier place

44:23

than they have have been in decades.

44:26

And that

44:29

is relative to Japan being a disaster

44:31

for a long time. I'm not saying that proves

44:33

their better value than X y Z

44:35

and other countries, but it certainly suggests

44:38

that Japan is no longer the negative

44:40

exception. You've really got to be careful about.

44:43

It's got well managed. Companies

44:46

like Sony aren't as exciting as they

44:48

used to be, but they've never gone away. The Japanese,

44:51

the Japanese car makers never went away,

44:53

and so on. That there are

44:56

opportunities there.

44:57

And do you think that jaman has also taught us something

45:00

about GDP and how to look at GDP

45:02

because everyone looks at Japanese gd GDP

45:04

growth and says that's awful, this is terrible,

45:07

But no one ever takes into account the fact

45:09

that Japan has a static or falling

45:11

population and Therefore it's GDP per head

45:13

is really really just fine. Whereas we have our

45:15

own GP looks like it it's growing

45:18

it well, not exactly reasonable levels, but

45:20

growing, But our GDP per head

45:22

is absolutely shock exactly.

45:25

It's it's that that is a

45:27

very important point. I mean again, it's one

45:30

of the standard negative points, and with some

45:32

reason on Japan that it

45:34

has this aging demographic. But

45:37

yes, you looking around

45:40

Tokyo, I don't know some of the regions

45:42

of Japan. Looking around Tokyo

45:44

and you do not. It's nothing

45:47

remotely like a place

45:49

that's been in a slump for a quarter of a century.

45:51

It's an exciting, buzzing

45:53

place where people obviously still have a very

45:56

very pleasant standard of living.

45:59

And

46:01

I think, yes, that that is quite

46:04

quite easily easily forgotten.

46:06

It's you're not buying

46:09

the country. I suppose, if you're buying a domestic

46:11

Japanese stock, if the population is going down,

46:13

that that's some kind of a limit on there their

46:16

growth. But but generally speaking,

46:19

you're you're you're you're

46:21

buying a country that has

46:25

continued to have one of the highest

46:27

living standards in the

46:29

world and has continued to have a very

46:32

large economy and.

46:35

That's that's uh.

46:38

Allowing allowing the population

46:41

to to to skew

46:43

your judgment is is a mistake.

46:45

I agree with you, and possibly a lot

46:47

to teach the rest of us about Asian populations

46:49

and how to manage them. Suddenly

46:52

Japan is perfect, right, Suddenly this country

46:54

can be no wrong. Praising a

46:56

disguise, they can do everything.

46:58

Yes.

46:59

The other thing that interesting about Japan

47:01

that has changed over the years is

47:05

that at this point, career

47:08

is the other example of this. But Japan

47:10

is cool. My

47:12

kids are in their teens, they are

47:14

fascinated by Japan. They're fascinated

47:17

by manga, they're fascinated

47:19

by anime, jpop. That all

47:22

of this stuff is exciting

47:25

and interesting to them.

47:28

And you know, they are envious

47:31

when I go to you know, not that I go

47:33

to Tokyo anything like as much as I would like to,

47:35

but you know, I have to have shopping lists with

47:37

stuff to bring back because they are

47:39

so fascinated by everything Japanese.

47:42

That wasn't true at all from

47:44

what I recall. When Japan was

47:46

lasted as it's high we all

47:49

had to go around with a sony aukman or whatever.

47:51

But it wasn't as though, you know, Japan

47:53

was sort of enviably powerful and rich,

47:55

then it wasn't cool, It wasn't exciting, and

47:58

it's cultural significance

48:01

has grown quite significantly

48:04

during the years that its economy

48:06

has gone off the boil. You could incidently see

48:08

some parallel there with our own country, Britain.

48:11

You know, the nineteen sixties and seventies

48:13

were not a great time for the British economy, but the

48:16

Beatles and David Bowie or whatever, it became

48:19

a much cooler place, a much more

48:21

interesting cultural place during

48:23

the worst years of worst economic years

48:26

for Britain, and arguably something

48:28

similar might have been going on in Japan. Do

48:30

I think Britain is cool?

48:32

Ha ha.

48:34

I'm a little too out of contact

48:36

with it, generally speaking.

48:39

Generally speaking, my gauge

48:41

for this is where my kids

48:43

are on things. They are fascinated

48:46

by the Beatles and the Bowie,

48:49

not just my influence. I don't think they're

48:51

so fascinated by Dua Lipa or

48:54

whoever else We would say was that okay, So.

48:57

We can't hope that there'll be a cool Britannia

48:59

trigger for the UK market to suddenly

49:02

joined the Jeff Harry's market in this Harry

49:04

Styles.

49:05

Harry Styles, if he could get back together

49:07

with Taylor Swift, that could transform

49:10

the country. If you could actually

49:12

write a song about how wonderful it is to be

49:14

back with Harry, then then

49:17

that probably is the catalyst

49:19

that at that point you fill your boots

49:21

with the fill your boots with the foot Sea Absolutely

49:24

fantastic.

49:25

But do you know if you've heard it here first, keep

49:27

an eye on Harry Styles. We've been looking for a catalyst

49:29

for the UK market for a couple of years now.

49:32

That could be it. John, Thank

49:34

you so much, Thank you thanks

49:40

for listening to this week's Maren Talks Money. We'll

49:43

be back next week in the meantime. If you like

49:45

ours show, rate, review, and subscribe

49:47

wherever you listen to your podcasts, and of course tell

49:49

your friends about us. And finally, we have

49:51

our show email, so send along ideas,

49:54

questions or comments to Merin

49:56

Money at Bloomberg dot

49:58

net. The episode was hosted

50:00

by me Maren sumset Web. It was produced by

50:02

some Asadi, Additional editing by Blake Maples

50:05

and special thanks to Jim Reid and to John

50:07

Authors.