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I mean it looks as though it's weakening yes I ask you what about technology and the contribution that the companies such as in Amazon such as a face book such as whether it be Apple all the tech heavyweights the contribution to the economy do you not see that it's very difficult to measure don't you believe it's there it is there and certainly the tech sector as is reflected in property prices on the west coast reflects that the marketplace knows that that's a sector of the economy that is doing well but if you look at the 330 million Americans the portion of Americans that are really involved in tech is very small and then if you look at China do you think there is no technology company in China we have lots of technology companies in Asia in India in China in Europe the same so this is universally a sector that has done very well until now will it continue to do well as you know the semiconductor industry is very cyclical like let's get back to sectoral calls on the consumer or domestically you talked about retail being soft but at the same time as a massive transition moving on to the productivity of online the Amazon sales all the online commerce going on you don't seem to be giving any credit to the consumer they're their preferences are changing it to how they buy absolutely that is true but if you look take total consumption it's relatively weak for this stage of the recovery then I have percent up maybe two in the next quarter that's we're all hoping for yes look I'm not dealing in one or two percents in India in Vietnam in China there has been a slowdown but we're still growing at six seven percent per annum easily suggesting that other markets cannot outperform remember they have underperformed the US market for ten years yes and it's about time and it's reasonable to expect that they might catch up that's different than saying that the US economy and the market is in a bubble and there's going to have a traumatic decline if we think just last point if we think about 1999 and 2000 and I managed to fund it fidelity then what we saw were infinite multiples on so much for the market the companies that you and I looked at those tech names they were ridiculously valued the companies were talking about today have lots of earnings and a lot of revenue and I believe that the situation is not comparable it may be they may be overpriced but it's not compromised you mean a lot of learnings like Tesla oh ok to share just want to mention I believe we had a bubble in Nasdaq in year 2000 in year 2007 we had a financial bubble and a bubble in real estate now we have a bubble in everything we have global decks as a percent of global GDP that is 30 to 40% higher than it was in 2007 in 2007 in 2000 we didn't have a pond bubble now in the US I still like Treasuries 2.2 percent on the 10 years is a huge yield compared to European and Japanese bonds at zero interest me that's your idea our bond yields as low as they are because it's it's a sign that the economy is weaker than people think or is it simply because of central bank intervention and still the sugar well in the US but haven't intervened but you see if you print money in Japan and by the ECB in Europe the money is printed by essentially the central bank's buying assets then I'm an insurance company I sell bonds to the ECB or to the BOJ or stocks they have liquidity now I see the dollar going up until recently until three months ago then I shift money into US Treasuries where I get the 2% yield advantage over local bonds so the printing overseas has actually helped the dollar until say the beginning of this year now I believe the money flows are shifting back and Europeans even more bearish than American Indian dollars where do you put it what are you putting him well I would put it rather in Europe and in emerging economies in angle you are in equities yes and in bonds not in European bonds credit or government debt mostly credit in other words corporate bonds in emerging markets I think there's still some opportunities they're hard to find and but I agree with you but look I'm telling you there is a bubble in everything there's nothing in a set price that that is very low and all of us and I also own lots of assets we're going to lose 50% either the government will take it away through taxation expropriation or there'll be a deflation in asset prices that is surprising most people on the downside between different sectors in the u.s.
the bubble is in the most popular stocks this may be great companies Amazon Netflix Nvidia and so forth but they are highly prized and don't forget October 99 to March 2000 the Nasdaq 100 doubled and then it went down 70% and NVIDIA which is one of the Millennials favorite stock declined in 2002 2002 by 95% and after 2007 it declined by 88% so these are very volatile stocks and I think that we are in a financial bubble not only stocks but also bonds and we have this liquidity bubble I would rather invest in Europe than in the US where valuations are lower and where the economy seemingly is improving that's what people think and I believe that there is an improvement also in Asia we have markets that are far cheaper than in the US so if you compare the US stock market compared to other markets in the world it is at the highest level ever compared to the rest of the world if I say ok improving economy in the US I mention that's what what do you say don't believe that no why I think the economy was mentioning well car sales are weakening this is an important industry also in terms of employment and I think that the retail sales tell you that the consumer he would like to spend but he's unable to spend because affordability is not there the Millennials the young people they earn less than their parents did the Boomers and have less money because they pay 50% of their income in New York and the Newport Beach and San Francisco and Los and so it's an affordability issue the Fed has been very successful in boosting asset prices but the wages haven't followed and so people don't have enough money spend and to invest burnings like Tesla Oh okay to shake but I just want to mention I believe we had a bubble in Nasdaq in year 2000 in year 2007 we had a financial bubble and a bubble in real estate now we have a bubble in everything we have global decks as a percent of global GDP that is 30 to 40 percent higher than it was in 2007 in 2007 in 2000 we didn't have a pond bubble now in the US I still like Treasuries 2.2 percent on the 10 years is a huge yield compared to European and Japanese bonds at zero interest me that's your idea our bond yields as low as they are because it's it's a sign that the economy is weaker than people think or is it simply because of central bank intervention and still the sugar well in the US by having intervened but you see if you print money in Japan and by the ECB in Europe the money is printed by essentially the central bank's buying assets then I'm an insurance company I sell bonds to the ECB or to the poj or stocks they have liquidity then I see the dollar going up until recently until three months ago then I shift money into US Treasuries where I get the 2% yield advantage over local bonds so the printing overseas has actually helped the dollar until say the beginning of this year now I believe the money flows are shifting back and Europeans are even more perished in american-indian million dollars where do you put it were you putting him well I would put it rather in Europe and in emerging economies in angle you are in equities yes and in bonds not in European bonds credit or government that mostly credit in other words corporate bonds in emerging markets I think there's still some opportunities there or define and but I agree with you but look I'm telling you there is a bubble in everything there's nothing in a set price that that is very low and all of us and I also own lots of assets we're gonna lose 50% either the government will take it away through taxation expropriation or there'll be a deflation in asset prices that is surprising most people on the downside I mean it looks as though it's weakening yes I ask you what about technology and the contribution that the companies such as an Amazon such as a face book such as whether it be Apple all the tech heavyweights the contribution to the economy do you not see that it's very difficult to measure don't you believe it's there it is there and certainly the tech sector as is reflected in property prices on the west coast reflects that the marketplace knows that that's a sector of the economy that is doing well if you look at the three hundred thirty million Americans the portion of Americans that are really involved in tech is very small and if you look at China do you think there is no technology company in China we have lots of technology companies in Asia in India in China in Europe there's the same so this is universally a sector that has done very well until now will it continue to do well as you know the semiconductor industry is very cyclical like let's get back to sectoral calls on the consumer or domestically you talked about retail being soft but at the same time as a massive transition moving on to the productivity of online the Amazon sales all the online commerce going on you don't seem to be giving any credits the consumer their their preferences are changing it to how they buy absolutely that is true but if you look take total consumption it's relatively weak for this stage of the recovery then I have percent up maybe two in the next quarter that's what we're all hoping for yes look I'm not dealing in one or two percents in India in Vietnam in China there has been a slowdown but we're still growing at six seven percent per annum easily that other markets cannot outperform remember they have underperformed the US market resolutely ten years yes and it's about time and it's reasonable to expect that they might catch up that's different than saying that the US economy and the market is in a bubble and there's going to have a traumatic decline if we think just last point if we think about 1999 and 2000 and I managed to fund it fidelity then what we saw were infinite multiples on so much for the market the companies that you and I looked at those tech names they were ridiculously valued the companies we're talking about today have lots of earnings and a lot of revenue and I believe that the situation is not comparable it may be they may be overpriced but it's not compromised you mean I think that we have to distinguish between different sectors in the US the bubble is in the most popular stocks this may be great companies Amazon Netflix Nvidia and so forth but they are highly prized and don't forget October 99 to March 2000 the Nasdaq 100 doubled and then it went down 70% and NVIDIA which is one of the Millennials favorite stock declined in 2002 2002 by 95 percent and after 2007 it declined by 88 percent so these are very volatile stocks and I think that we are in a financial bubble not only stocks but also bonds and we have this liquidity bubble I would rather invest in Europe than in the US where valuations are lower and where the economy seemingly is improving that's what people think and I believe that there is an improvement also in Asia we have markets that are far cheaper than in the US so if you compare the US stock market compared to other markets in the world
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