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Morgan Stanley 전략가 Mike Wilson이 2022년 베어 입장에서 틀렸다고 인정했다는 기사를 다룸. 발언자는 Wilson이 디플레이션/이익 침체를 말하지만 실제 역풍은 disinflation에 의한 매출 둔화라고 봄. 인플레이션에 의한 가격전가(fake pricing power)로 매출이 늘던 기업의 성장은 약해질 수 있어 필수소비재·방어주보다 실질 성장주와 잉여현금흐름이 탄탄한 기업을 선호한다는 입장. 유동성과 AI 테마는 선반영 가능성 언급. 중립적 분석 위주이며 구체적 종목 가격 예측은 드묾.
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Mike Wilson was heralded as one of the great economists declaring that hell of 2022 and being right time after time and time again in 2022 as stocks just hit New Low after new low after new low finally culminating in a painful end in December of 2022 for many stocks get now Bloomberg is nearly making fun of Mike Wilson suggesting that he's hit his mayakopa the I was wrong apology and that folks is exactly what we need to explore now why was Mike Wilson wrong and what does he now suggest is going to cause the next great headwind for the economy and stocks going forward well of course deflation yes Mike Wilson is now going from well inflation is not the problem to it's an earnings recession oh wait maybe it's not an earnings recession maybe it's actually a revenue recession that'll be driven by disinflation which will be the true headwind but he does admit in this piece that he was wrong so let's evaluate what's going on with Mike Wilson and let's give people credit where credit's due everybody can make mistakes so this is by no means a hit piece on Mike Wilson it's just to say I love seeing the Bears flip because now we can finally get all on the same page and we can start looking forward at what potentially is actually a headwind so is that disinflation and where is Mike Wilson say he was wrong well we'll get to that in just a moment quick reminder coupon code expiring tomorrow for the programs on building your wealth massive expiration we're looking at uh but it's a productivity course entrepreneur course you know if you're an employee it's great as well the goal is increasing your income right zero to millionaire real estate all these phenomenal programs the shadowing Property Management all of a massive price increase tomorrow after that coupon expires so stay tuned for that linked down below or so what do we have here this inflation is now eating into sales growth which means investors focus is likely to shift towards Top Line Growers rather than just companies exhibiting cost efficiencies so I wrote next to that hmm so like actual growth stocks and the reason I wrote that is because of my personal positioning and where my positioning has gone uh you know since since I sold in January of 2022 uh again I you know bought back in obviously throughout 2022 in various different by the dev sessions but the argument that I made back in 2022 is that eventually what we'll want to look for are companies with true quality growth and potentially even uh you know strong free cash flow that we would want to stay away from companies with low free cash flow or ultimately uh the you know a low ability to potentially survive a recession and some of that is exactly what we end up seeing Mike Wilson talk about in the story and I think it's interesting because it's a big flip from what we've been used to Mike Wilson saying uh much of what Mike Wilson has been focused on has been this idea of let's get into defensives let's get into Staples but it's really been the Staples that have benefited the most of just that headline Revenue growth based off inflation in fact if we take a peek over here it says what to own in Mike Wilson's piece as we head into the bulk of earnings season over the coming weeks we expect performance dispersion to rise and we recommend investors look for stock ideas with the following attributes how familiar does this sound ask yourself truly does it does this sound familiar to what I said you know a year to seven months ago High earnings quality strong free cash flow and improving earnings revision driven by sales growth really interesting because that's literally what we had talked about uh about positioning in contrast to this idea that oh Staples and defensives are where it's at which means if you want to counter trade Mike Wilson maybe is it now time to look for cheap defenses anyway so what do we have here so this gives us a little bit of a heads up here uh he does indicate advertising is has been pretty upfront weak in spending and this is true we've seen some weakness in advertising uh cyclical housing headwinds are reaching a peak globally and uh take a look at this this is where he indicates that uh you know or I should say this is where he breaks that oh look at this Jim Bill Jimbo's even talking about it everybody's look at that we were wrong Wilson higher valuations than expected yeah this is where Mike Wilson breaks down his reasons for why he believes he was wrong one of the reasons he gives is he argues that the debt ceiling being extended and adding basically a trillion dollars to to the US debt came as a surprise I wrote on the left side here really like it was pretty widely expected that we were going to extend the debt ceiling we knew it was dramatic but there was really no moment where people like oh yeah we're really going to default and at least on Wall Street certainly mainstream America a lot of people are like yeah Donald Trump says default get in there and throw the furniture around let's go let's default sorry uh then he talks about this idea that well you know be careful because soon 27 million people are going to have to start repaying student loans but there's actually an asterisk on this remember 27 million people do not have to start repaying their student loans they just start accruing interest again they actually don't really have to start making payments again until next year just also somewhat remarkable to consider he also talks about this idea which we've heard before about consumers willingness to borrow on credit cards to basically keep spending money and this is where again I love looking at this chart household Debt Service payments is a percentage of disposable income sorry folks the trend for the Bears is down you can see the trend line right here on the oh there we go now you can see the trend line there on the right the trend is down where actually if anything bouncing off of the trend line and continuing to Trend down we're way lower than where we have been on the uh over here we've got talk that well you know the Federal Reserve they injected liquidity through uh the banking crisis and that's not fair you know they gave us QE so there's sort of a lot of like lashing at explanations it feels like for why basically you know Mike Mike was wrong and and it's okay it's okay and these are not necessarily oh completely wrong I mean it is true that consumers at some point are gonna have to repay their student loan debt that can affect five percent of uh revenues that companies is an expectation but many have believed that markets are already pricing this in and again it's going to come A year later than we really expect this uh refilling of the treasury general account and the liquidity issue I mentioned over here that ended up being of course a giant nothing Burger which we expected because of the ample buffer in the federal reserve's repo facility which isn't actually mentioned here uh there is this talk though about liquidity Trends not being supportive of equity prices this is is an argument right so the yellow line here is the S P 500 this is roughly the average we're drawing here with a little laser and then of course you've got the blue line here showing liquidity you can see this massive gap on the right side where liquidity is actually relatively low relative to how much the stock market has rallied in my opinion while this is a red flag it is possible that liquidity expectations are being priced in up to 18 months to two years early where markets are of the belief that oh don't worry liquidity will come back from the FED we'll get there I mean I believe that I actually think we'll get back to quantitative easing certainly by 2020 five six and that might be pre-priced getting pre-priced in so uh Mike Wilson does warn that he believes that it's premature to extrapolate the benefits of artificial intelligence across everything for this year but does agree that AI in the future will be extremely constructive especially for companies like Nvidia and Microsoft here you can see that the upside move and Equity multiples on the back of the themes we've seen has has been a lot stronger and lasted a lot less a lot longer been more persistent than they anticipated that is we were wrong he says this is a pretty powerful piece on Wall Street right now and I expect to hear a lot of folks talking about it and it's nice to see the actual piece inflation is now falling faster than consensus expectations I thought this was also quite fascinating that Mike Wilson is basically talking about hey inflation is actually less of a headwind than we thought if anything is falling less than expected no reanimation of inflation though a lot of bears aren't arguing that inflation is really going to take off now they're arguing that the earnings recession and the cumulative effects of fat tightening are going to crush us into an earnings recession that'll lead the FED to stimulate again which could lead to inflation again it's unlikely that we'd see the inflation again that we saw in 2021 but it is possible that the bite of Fed rate hikes hasn't quite fully hit yet now here Mike Wilson argues that many companies had their sales grow solely because of price this is something that I've regularly argued especially when we look at sort of the rollover of inflation Dynamics which we regularly talk about It's always important to remember how these sort of price comparisons work easiest way to do that is visually so if we look at 2023 versus 2022 it's always worth remembering that most companies took their price increases in q1 of last year with some lingering price increases into Q three more of them really in the first half than the second half right that really actually means that if we compare 2023 back to 2022 a nine percent price increase taken in q1 will actually look like an increase in prices in Q2 in Q3 in Q4 in q1 and then you get roll off or if you didn't change prices again you'd be at zero that's where you'd eventually get roll off of course if you increase prices something more gradually and you said well you know we actually increase prices six percent then three percent then one percent then zero then you're looking at a six percent bump over here uh well actually let's let's go back a little bit zero and price increase over here let's draw the price at what what the inflation would look like quarter after quarter in this quarter it looked like you'd have a nine percent bump then a ten percent bump in pricing if you went for six in q122 three in Q2 one in Q3 zero in Q4 all of 2022.
you'd have this cumulative inflation effect right so you'd have six in q122 9 in Q2 22. 10 in q322 uh technically uh then you'd be flat but still 10 of an increase you get to q1 you're at a ten percent increase Now You're Gonna Roll the six off here's how how the roll-offs work assuming you didn't take any more price increases You're Gonna Roll Off that six that you had on the prior comparison and now you're actually only going to be four percent higher now we're going to roll off those three and then by Q3 2021 you're actually only one percent higher and then you're flat so this is kind of how that roll off looks and it's unfortunate because for a lot of folks who were reading this sort of headline news on you know Bloomberg or whatever where there was talk about hey uh there's there's this uh there's this massive fear that wait a minute we're going to end up with uh all of this uh this inflation all throughout 2023 because look Pepsi just raised prices in q1 or Domino's raise prices five percent in q1 no no they didn't those were year-over-year comparisons so if we draw this in for exactly what Domino's is saying here we're looking at expecting a 3.9 here 3.9 here and then we're getting down to two percent by that fourth quarter right so you're really getting this this uh you know more of a corrected View of how we should actually be looking at inflation roll-off when when we consider ah okay this is how roll-off is going to function unfortunately and more people realize that in the first quarter I think they would have invested in stocks more because we would have realized okay inflation is gone no that's exactly what we did at least myself because well in my opinion it was pretty clear inflation was going away but not because of lagging data coming to us from uh you know from from Bureau of Labor Statistics or the Census Bureau but rather my favorite way to look at leading indicators of inflation is actually determining what our companies actually doing and the best way to see what companies are actually doing is looking at those earnings calls and saying okay well how are they behaving relative to what uh what people expect the rollover of inflation Dynamics leads a lot of these stable companies whether it's Pepsi or otherwise to show more uh gains in and revenue growth then they are probably Justified to have now he indicates that those will be a material headwind if pricing power were to roll over for those companies now this is actually what I went on to call faux pricing power we coined this term somewhere around January and I said Pho pricing power is when sales are up because everybody's raising pricing it's during an inflationary time but in my opinion true PP true pricing power is increasing sales relative to the competition in other words in your class in whatever area or field that you're in are you able to maintain margins and increase sales better than your competitors that is true pricing power in my opinion it's relative pricing power compared to those around you a great example I think is you know Tesla of course is reducing prices but the entire industry is reducing prices which company however though still has the best margins or better margins or a better capacity to increase sales than other companies and quite arguably that is Tesla the same could be said about a company like apple where Apple might not be increasing pricing on the iPhone but they're still now expecting more sales than well a ever before and B compared to any competitor another pricing Power stock okay great so the inflation-driven boom we pointed to at that time uh is uh now leveraging in reverse and this is just a a warning again for those Staples and defenses which is the opposite of what Mike has been recommending even up up to potentially as recently as last week where he still reiterated and doubled down on Staples and defensives so something worth keeping in mind on this is a very big flip-flop that sort of box of uh you know here are the stocks we recommend uh you know this this chart actually uh is the chart that they've regularly pointed to uh they they have not find it incredible that they've kept it the same Healthcare Staples utilities uh and still underweight discretionary and cyclicals okay great well let's keep looking at a couple more a piece of items here from what Mike mitt Wilson has to say there are a few more things in here that are quite interesting so earnings revision breath has decelerated over the past two weeks and is now at negative territory uh in other words expect more potential uh downward outlooks from companies pessimistic uh forward-looking guidance I agree actually that guidance is going to be a big part of a stock moves over the next few uh a few months as we get through not only this sorting season but expectations for Q4 a lot of fear that Q4 will actually end up being where the yield curve finally bites and drives us into recession uh so here's some charts talking about those consensus estimates falling uh and uh what do we have here Consumer Finance net charge offs are increasing uh with the low end consumer being challenged card spending is slowing but loan growth is is still high because consumers are paying less of their loans off this is I put a little a here because it's again when we look at the percentage of disposable income it's not 100 true however it is true that there is a lack of price Discovery in commercial real estate because so few were deciding to sell that's actually one extra piece that I think is so interesting is so many folks are worried about the impact of potentially a commercial real estate crisis and some kind of collapse in the real estate market because of commercial real estate but what you're actually finding is because so few commercial real estate owners are selling it's actually really hard to realize that there's any kind of office or commercial real estate collapse why well because nobody's selling or very few were selling like you're getting some San Francisco properties trading uh very few otherwise because rates are quite High uh you know which obviously it doesn't justify uh buying some of these larger properties at this point unless you can get a really incredible deal but sellers are still holding on to not necessarily wanting to give up to their properties in commercial real estate uh for a great deal that will change over time but it's certainly coming a lot slower than expected and Mike Wilson has a good point here that you could really delay this commercial real estate crisis which we've already updated many valuations for these commercial properties for the equities just getting written down not to the point of actually calling for a debt crisis we talked about this the other day where basically you know if you have a 100 million dollar building and enjoy drops 40 in value and it's leveraged to 60 percent well then the bondholders or the node holders don't lose a dime it's just the equity investor that loses money uh anyway so I find that an interesting argument as well though from Mike Wilson here that hey you know everything's just going a lot slower than expected and things are just going better than I expected and therefore Mike Wilson says and admits that he was wrong so now we have to find a new bear to follow of course we'll still read Mike Wilson's pieces and see if there's any kind of new flip flop but I find it very interesting so that does it for this morning's me Kevin report I hope to be live a little bit later with more information and coverage so uh that is the Great meets Kevin report brought to you once again today sorry for not being here yesterday appreciate you I'll see you in the next one jumping over to the course member live stream now ]
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