Ep.113: Nvidia's Blowout Earnings & Is The Bear Market Rally About To End?

Hello and welcome back to the Friday podcast. And I'm going to say Friday because any of the regular listeners, if they might have heard that we've got a new series running called The Deal Room, which is very much more corporate finance vibe where we talk about all things M&A, IPO, private equity deals, these sorts of things. And that's with our head of corporate finance, Stephen. One thing, Piers, I'm not sure if you caught the episode yet, but Stephen did say that he reckons he's gonna get more downloads than you. Just putting that out there.

He also said that, or maybe it was you actually, said that he's more attractive, a younger and more attractive version of me. Not sure how I feel about that.

But you feel like—

Knowing full well that both are very true.

You forget my job is to make you and Stephen shine. I'm just here, uh, best in both of you. So I'm gonna say the same thing, you're really the star here, Piers.

Let's be honest, keep talking. Um, but yeah, I thought it was very good. Yeah, if anybody listened, if you didn't catch that, it's gonna be every week. I think that's a really, really good new new show. Um, so yeah, looking forward to that every week for sure.

Yeah, so just in terms of routine, to be clear if you're new to the channel, we have a Global Markets Wrap-Up, which is Piers and I, and we talk about things like today you're going to talk about Nvidia, the stock market, the debt ceiling, these types of more top-level macro topics. But with Stephen, we drill really into the deal flow, uh, specifics, strategy, corporate side in much more detail. So hopefully if you're thinking about a career in all parts of finance, whether in asset management, PE, trading, we've got you covered. That's the point. So yeah, we'll have the trading room or the, the deal room on a Wednesday, the trading floor on the Friday. That's the setup.

Like it.

Um, looking at the stats though, just before we begin and I quickly give you an idea of what we're going to cover, um, I did clock that the majority of people who do listen regularly, um, are not actually subscribers. So if that is you, you're listening hit that follow button and then you won't miss out, um, on any of the future shows. And yeah, I know a lot of you are absolutely stressed at the moment with exams, so, um, yeah, you can go back, listen to them, get yourself up to speed if you're starting an internship or you're getting your head in the right place and focus for the next application season. Hopefully it helps. But yeah, let's get into it and give you a quick summary of what we're going to cover in the next half an hour or so. NVIDIA earnings Can't have missed that. They are up 25% and they've now become the 4th largest company in the NASDAQ 100. Bigger than Alphabet, bigger than Meta, bigger than Tesla. NVIDIA is right up there. So we'll talk about what happened, why. It's a really interesting story that's been underpinning their shares for a long time, in fact. Then we're going to talk about stocks in general. Um, we just keep going up despite A lot of risks out there. Um, the banking crisis cooled off, but that's obviously quite fresh in mind. Got the debt ceiling, will the US default, all these different things. And yet stocks keep going up, lots of bullish bets flooding into the market. And we'll discuss, um, what's the current status, but also what are the current risks at this point in time. And then we'll have a quick update on the debt ceiling saga as well. It still rumbles on, but we're getting very close to the cliff edge now. So what what's the latest there. So perhaps, um, Nvidia finished yesterday's session up 25%, earnings beat. Perhaps most significantly, Nvidia said they expected sales of about $11 billion plus or minus 2% in the current quarter, because remember it's backward-looking when they report their corporate earnings. The idea being that in the current quarter their expectation of $11 billion is more than 50— 5-0— 50% higher than Wall Street estimates of $7.15 billion. That I have not seen before.

Right. Well, I was going to say, that is just— I literally never seen anything like it. Just the most remarkable set of numbers. And yeah, you're right, it's all about this forecast. So they're a bit out of sync, Nvidia, which often— I don't know, if you're not tuned into earnings season and all the rest of it, it often catches you a bit by surprise because they— their quarters, the way they report, is out of sync with the sort of calendar quarters. So when we're talking about their forecast for the quarter we're in now, that's for them, that's the quarter to the end of July. So that's why they're reporting their quarterly earnings here in, in May. When most companies report them in April, they're basically one month out of sync of the usual timings. But, um, so analysts had forecast that in this quarter up to the end of July, Nvidia would generate sales of $7.2 billion, and they came in with, nope, we're going for $11 billion. And yeah, as you say, it's a 50% uptick on the Street's forecast. My favorite stat— I mean, obviously the share price just went, you know, stratospheric, went up 24%. We're not messing about here. This isn't a small cap. This is like one of— already one of the biggest companies, right? And for it to go at 24%, my favorite stat, it added $184 billion to its market cap. Which makes it the biggest one-day gain ever.

Is that right?

Yeah, the biggest one-day gain for a company's market cap ever. So that kind of puts it in perspective as to exactly how remarkable this move is. And they're kind of— it takes them up to just shy, I think, well, depends where they open today, I guess, but their total market cap post-rally, $939 billion. So just shy of that. Exactly. And as a reminder, who's in the VIP room? Well, the $1 trillion club: Apple, Microsoft, Alphabet, Amazon, and then Saudi Aramco. The, uh, the kind of—

yeah, must be an odd posse when you're in the club.

Yeah, there's definitely an odd one out. So yeah, they're, they're, they're nearly there. Yeah, so quite, quite extraordinary. Yeah.

And one of the things I saw, I mean, it's just been littered with stats obviously, again. Yeah. Nvidia is now 6 times the size of Intel, and yet I think it was, uh, Intel's revenue is double. Yeah. So that leads us to them.

So yeah.

Intel's revenues are twice Nvidia, and yet Nvidia is 6 times larger. So people are pricing in forward-looking potential here. So let's talk about that, because that's really what's driving the stock price. Just like you said, yes, it was the biggest move on record, but I— was the stat— there was how many multiple thousands of percent is Nvidia up over a 10-year period? This stock has been integral to the evolution through what the— even the, the chip that drove the mobile phone phase to the services products that came on the back of that and beyond. And now they're involved in so much more.

It's the changing of the guard. I think a good, uh, historical, uh, sort of analogy, sort of comparison would be Nokia and Apple. Be thinking about the mobile phone market where Nokia were absolute dominant kings, and then Apple came along with just the next generation. And, uh, slowly but surely, you know, the baton was handed over and the superpower status shifted from one to the other. It's exactly the same here with, with Intel and Nvidia. Nvidia are built for the future, and the future just all of a sudden the size of the market that's available, um, has just suddenly exploded, or, or it's accelerated. Um, because look, we're thinking that at the moment, in terms of— well, I will actually— let's just step back a sec before we get into the too finer detail, because I don't know, Nvidia, they're not, um— I, I always think they've kind of— they're kind of playing like the younger brother, if you like, to the big tech boys. I don't think they quite get the superstar status often that your other big techs— when you're talking about FANG indexes and all the rest of it, the N in FANG is not Nvidia, it's Netflix. And you're like, well, actually, that's ridiculous because it really should be Nvidia. So I always think they never quite got the credit they deserve. And often, I don't know if people quite fully understand what they do. I mean, obviously, they're— They're in the chip game, but they, they produce graphics processing units. That's their GPUs. I was reading, I actually asked ChatGPT, explain to me what a GPU is as if I was a 7-year-old. It gave me quite a good analogy. I'll read it out. Do you want to hear? So the analogy was, imagine if a computer is like a construction site, okay? The CPU, that's the central processing unit, um, that's obviously a key piece of kit in the computer. That's like the site manager, all right? So that's making sure everything's running smoothly, it's handling, handling a lot, lots of different tasks, okay? It's managing the whole thing. The GPU is like a skilled worker that's really good at one specific thing. So obviously In the case of NVIDIA's GPUs, it's creating and manipulating images. OK, so whilst the CPU is busy coordinating all sorts of general tasks, the GPU focuses on making sure all the visuals look great. Now, this kind of— why has NVIDIA all of a sudden just exploded is because really they were in the business of creating GPUs for the gaming industry. It's all about graphics, right? And fine, obviously the gaming industry has been growing, you know, very sharply over the last 10, 20 years, whatever, okay? And so obviously Nvidia have been on the rise, but all of a sudden, um, it is the case that, um, Nvidia are prime, perfect place to take advantage of the AI revolution. So the AI breakthrough— so the kind of latest AI breakthrough is the transformer model, okay? Talking about NVIDIA's products, their key one's something called the H100. And this is like the foundation for how large language models basically operate. So these— this kind of sudden AI explosion It's thought that, A, Nvidia have got the technology for it, and but most importantly— or no, equally as importantly— they've got the capacity to deliver on the massive spike in demand. Because it's all, it's all well and good having the product, but can you build enough, especially in this particular situation where the demand has suddenly just gone exponential? And Nvidia do have believed, the infrastructure to actually meet this increasing demand with a massive, you know, sharp uptick in supply. So that's kind of another key thing here.

Yeah. To give it some like commercial numbers. So their flagship AI GPU, that A100, that sells for around $10,000 at chip.

Is that right? Wow. I didn't know that.

$10,000.

Wow.

So, and that's the hardware of choice, as you said, for large language AI models. Now, a supercomputer, yeah, can use thousands of those chips at any one time. They're 10,000 a pop. Wow. So an AI supercomputer constructed by Microsoft, so hosts like OpenAI or something like that, that would be featuring tens of like thousands of these things. So you can imagine. And then, yeah, the H100, which is like the next evolution, um, that's then talking about cloud-based AI supercomputing.

Yeah.

Which is like then the next gen, if you like.

So, well, this product is insane. It's got, um, so the H100, it's a hardware accelerator, it's got 80 billion transistors on it. And they use this kind of manufacturing technology. It's called 4-nanometer manufacturing process. But basically the chip game is who can build the most powerful chip, right? Who can build a chip that can deliver the most powerful sort of power. And ultimately that's just a game of how many how many kind of transistors can you get, can you mount on a chip? And remember, the chip's got to fit into a bit of hardware, so size is key here. So can you make a super small chip that's got as many transistors on it as you can possibly fit? And this has been the game over the last decade, um, and NVIDIA are right at the forefront of smashing all the records and this 4 nanometer. So they're just able to mount transistors 4 nanometers apart, meaning they can get more— the transistors are smaller, they can mount them closer, and this is the game that they're in. And actually, I'll just— a quick, maybe a slight tangent, only briefly before we come back to the main kind of nuts of it, but this is quite— there's geopolitics involved here because back in August last year, Biden announced a banning of 4 major semiconductor technologies for export to China. So this is the key advantage that the US have over China in the chip race. It's, it's, it's, it's their ability to— this 4-nanometer manufacturing technology is only, only the US have cracked it. China's quite a long way behind here, so the chips they're producing are nowhere near as powerful. So Biden's aim is, right, let's cut off access, let's cut China's access to these more powerful chips, and in so doing let's slow down the rate at which their kind of whole technology stack is evolving. Okay, um, so there is a bit of politics in here. What was interesting to hear though, um, on the call, the, um, Nvidia CEO spoke very briefly about this, and he, he's anti-this. He was saying that, look, if China can't buy from the US, they'll just build it themselves. His view is that By banning the export of this stuff, it just will accelerate China's kind of—

100%. Yeah, so it's a classic, it's a classic kind of gaffe, that kind of corporate espionage. Like, China are the kings of that. And so if they can't get them, they will just take— get the information that's required to then— and we know that China have a pattern of that type of behavior.

So such a classic short-termist political gaffe.

Yeah, it makes me feel quite bullish Nvidia shares though, because if I was like the company in itself and its management, knowing the political context, yeah, and the pressure points of the current administration, they're going to be favorable surely. So when this is one of the things about being the drummer in the band and not the lead singer is that no one cares. No one wants to see me going to Tesco's to do my shopping and take a funny photo of me. They do that for the lead singer. That's your Apple, that's your Google. Yeah, I'm in the back, right? And I'm absolutely creaming it. No one knows who I am. And then I go to the club, not get bothered.

I like it. My life is the drummer.

I like at the same time the, um, the government you know, you're kind of— you've got the benefit of this whole crackdown on big tech doesn't really affect me, A, because politically I'm like the jewel in the crown, and then B, I'm not really that public with what we do. It doesn't really hit the mainstream in that same way. And so there isn't that like political kind of martyrship that you see when they come to big tech and talk about privacy and all these types of things. You're just a manufacturer of a product. So you're kind of shielded from a lot of that potential growth barriers that, that might hit other larger tech firms.

Yeah. Well, like all the kind of antitrust stuff, like blocking, like Microsoft, you know, trying to buy stuff and getting blocked by the antitrust regulators. Yeah, you're right.

And that's not even without talking about the fact that, you know, we've only talked about generative AI and stuff, but You know, before that, you remember everyone was going nuts over Web3 and Web3 being then accumulation of lots of different things. So virtual reality, graphics, cryptocurrency, i.e., mining.

Yeah.

On a huge scale. So all of these different things, these elements, they are critical, right, in multiple paths. So yeah, I mean, are they overvalued? Well, they're up 11,000% in the last 10 years.

Yeah, but okay, so if you think about the total addressable market, yeah, right, TAM, at the moment it's thought to be $100 billion, right? The, the kind of AI space in terms from the chip point of view. So Nvidia's total addressable market currently $100 billion, um, and that's kind of shot up, right? But they expect that to grow 39% AGAR, as we say. So, you know, um, annual— so the compound annual growth rate, okay, 39% per year, every year. So actually, by the 2030, that $100 billion becomes north of $1 trillion total addressable market. Um, so are they overvalued? I don't know. Here's one argument to suggest that this is a, a kind of— not, not a flash in the pan, that's wrong— but just a temporary blip higher, but it's temporary and it pulls back and people calm down a bit. Only because, as you've just been saying, right, OpenAI have just bought— I don't know how many of these H100 chips, but a lot. Because all of a sudden, obviously there's been a huge demand for their product, number one. But obviously, number two, you need cash to buy this stuff. Right? And oh, they just had $10 billion of cash just shoved into their account from Microsoft. So is there a temporary spike in demand that isn't sustainable? I'm not saying demand's not going to rise over the long term. I'm just saying maybe there's been a temporary acceleration in demand that's not sustainable, and the, the growth rate in demand might slow, maybe, as we track through the rest of the year. But so maybe, look, we might be in a bit of a short-term frenzy here, big spike. But don't get me wrong, the long-term, you know, fundamentals look phenomenal. Um, it's just be careful about a bit of FOMO here. Um, I think there's a bit of technicals as well because the spike on Wednesday did take them above the 20 2021 high. So the 2021 high was about $330. That got taken out in style. Um, so there might be a bit of technicals here. I smashed up to— what was it— $380, I think. So it's made a new all-time high.

So when was the— when was that high in '21? Feb?

That was November 2021, which was the kind of top of the— the top of the kind of COVID tech boom.

So that would have been as well post the for the one stock split they would have done a couple months earlier before that, right?

Yeah, if you go to— I mean, look, if you go to the start of 2021, they were trading at $130. By the end of the year, it was $320, $330. So yeah, they had a big 2021, like, like, like most of the tech industry, right?

And talking, um, FOMO, then let's talk about the broader stock market. Yeah, getting some data from Citi earlier this week, and all of these banks obviously are quite— have good visibility of flow coming from their clients. And they said investors have pumped $21 billion into US stocks. So despite this debt ceiling media frenzy, which has all been quite negative, um, the bank's data suggests then that it's all been parked into long S&P futures positions. And actually the longs now outnumber shorts 9 to 1, right, at this present point in time. So yeah, maybe you could perhaps explain a little bit about this idea of how they track the flow and what does 9 to 1 really represent in terms of—

if you're thinking about— well, if you're thinking about price, right, what moves price? What is buyers and sellers? And so, you know, ultimately at a fundamental level, you know, it's that perennial battle: how many buyers are there, how many sellers? And there's more buyers than sellers, well, then the thing goes up, right? And if there's more sellers than buyers, then it goes down. But the, the, the, the bigger the, um, the, the difference in, in size of those two camps gets, well, then, you know, if you're at 9 to 1, it means that you're kind of at very extreme levels. The point being, right, if 90% are buyers and they've already bought Well, who else is going to buy? I mean, how, how can the price continue to go up if everyone's already bought? So when it gets to extreme levels like this, it is a signal to suggest that the momentum to the upside is now perhaps running out, and maybe it's the top.

Yeah, so put the FOMO people aside. The other thing about breadth Yeah, um, right, difference between the previous market rally where tech was getting hit actually at that time as interest rates were pointing to be going higher. We're now on the other side of that. Markets are pricing rate cuts, tech's now rallying. However, it's very concentrated. So what— when people, when people read about breadth, what is it that they should take away from that?

So when you're thinking about an index And when it's going up, why is it going up? It's not that, like with the S&P 500, right? You've got 500 companies. So if the index is going up, that doesn't mean all 500 companies are going up. There are different components, right? And actually it is the case that this rally is a bit— it's very weird, this rally, in so much as— so if you take the top 10 stocks in the index, well, for starters, the top 10 stocks in the index of 500 companies, the top 10 make up 29% of the whole index, which is very high. Historically, that's a, that's a, that's a very high amount. It's not, it's not unusual for the top 10 to make up like 20%. I mean, the top 10 normally dominate, but not quite to the point— it's got to an extreme level here, right? So the top 10, like, who are the top 10? Well, Apple number 1. I'll list them in order, okay? Apple make up 6.6%, Microsoft 5.6%. They're the absolute 2 giants. Then you drop to Amazon that makes up 2.5%. Nvidia have now just smashed up this list big time, and they make up 1.7% now. They've literally jumped like 6 or 7 places on this list this week. Um, but Nvidia, then you've got Tesla at 1.6, Berkshire Hathaway 1.6, Alphabet are in there twice with their A and B shares. So they kind of together, I guess, Alphabet makes up, um, 3%. So they, they really are the number— Google are the number 3 on the list, if you like. And then you've got ExxonMobil. And UnitedHealth Group. Okay, so these are the stocks, right? But it's the big tech giants. So actually, the top 10 here, and certainly the tech within that, they, they've made up 70% of the rally year to date. 70% of the whole index rally is because of the top 10, and more specifically, the tech stocks. Um, so it's very narrow, right? The rally is being driven by a very small number of companies that are going up a lot. The majority of the companies in the S&P 500 haven't gone up this year. And so again, there it's— that's, that's historically a sign that the rally is not sustainable because it's not broad-based. And if you get any kind of signal that actually people might start to book a bit of profit on tech, well then this index is coming down rapidly. Now why might there be a trigger to book some profit. Well, the rally's been about, as you said, rate cuts, right? The Fed hitting the top of their hiking cycle and starting to cut rates as the recession starts. Except that that view is starting to look a little bit unlikely, right? Because the recession— here we are, we're not far off halfway through the year, and what recession? Okay, so far from are they going to cut rates, I think we're edging back towards the camp that they might continue to hike. So this might be a trigger to go, right, you know, I've had a good run here on this tech. This tech stuff's been fantastic for me, but you know what, I'm gonna book a bit of profit. And then that's where you're going to get your sell side volume increasing, and, and there aren't many buyers to hold up the wave of selling, right, because everyone's already bought.

Yeah. Well, look, let's, um, talk through a couple of the highlights on the other side then, because Mike Wilson, of course, has been pounding the street. He's a well-known US equity strategist at Morgan Stanley, biggest bear on the street, but he is actually, I think, the number one forecaster for the S&P 500. I think it was last year, so he's the most accurate.

Well, the year where it— the year where it went down. Yeah, for the first time in a decade, right?

Well, this is the same twice a day, but here, so there's— he's got 6 points. I'll quickly run through them and feel free to, to pop in on any, any one of these. So valuations are expensive. So that's the whole kind of mantra of his thing. Deep earnings, deep earnings recession is what he calls it, as a, as a total kind of packaged view. The median PE multiple is 18 times, and that's near the top decile in the last 20 years. Then second point, a healthy reacceleration is already baked into second half consensus earnings estimates. Number 3, exactly what you just said, markets are pricing for rate cuts, um, but they don't Morgan Stanley see that happening, um, not unless we definitively enter into a recession or the credit market deteriorates significantly, which isn't happening, as you were saying.

Yeah.

And 4, the presumption that the banking crisis will not worsen or become systemic. And while MS think that, yes, we're not going to get a rerun of the financial crisis of '08-'09, they're talking about, um, they do think that this banking crisis now will accelerate the credit crunch that was scheduled to begin by this year, given loan officer surveys, which they track on a regular basis. The fifth one was consumer resilience. That's been quite surprisingly strong across most areas actually in the Western world, in the US as well. But there's some signs emerging that that's fading because you can track various different discretionary spending indicators and even those at the high end of the spectrum of wealth. They're also pulling back a little bit, um, as a key sign. And then probably most interesting, US debt default or 11th-hour resolution. Their view, or his view, is that an actual agreement might be a bigger risk to markets. That statement in itself is a bit weird because you're thinking, hang about, you guys were just talking the last few weeks about how it's the end of the world and things like that if this thing actually does blow up. He's actually saying no, actually stock market is going to fall if this thing goes through. And this is, I guess, one of the things that is hard to really understand about markets until you see it, until you're in it. Because at the moment stocks are rallying partly because a deal is coming, right? So there's kind of the timing thing about markets are always forward-looking, pricing in the future. So at the moment, we're pricing in the, um, sidestepping the worst-case scenario. But then I guess what Mike is talking about is that what will happen here then, in short, raising the debt ceiling could decrease market liquidity based on the $1.2 trillion in Treasury bill issuance that they think we'll see in the next 6 months. His conclusion being that while many individual stocks and sectors have traded poorly this year, the major indices are priced for simultaneous good outcomes on multiple fronts, which they think the risks are elevated and increasing in some instances. That was his—

Yeah, I mean, I think if you track him and monitor him, he's been calling the top of the S&P every month, 2023, and he will continue to call the top every single month. Every single month so far he's been wrong. So is he wrong again? I don't know. But I would say, in my opinion, I'm not a believer in this rally in 2023. And I'm kind of, again, quite staggered it's still happening. So as the year rolls on, I do think it's more likely that he becomes right. It's quite a lot. I— with the debt ceiling thing, if you're so biased towards a view, you will take any scenario you want and you will fabricate an argument that matches your view, right? There's a little bit of that in his assessment here, that if a debt deal, a debt ceiling deal gets done, stock markets sell off. And I guess his point technically could be right, because he's saying, right, this will mean then issuance of new treasuries. So you're going to get a lot of new financial assets coming to market, new supply. And these treasuries are at decent yields now, certainly based on like the last 10 years, right? So you might find if you've got portfolio managers that have been long tech, they've got a lot of profit, they might go, you know what, yeah, the Fed might hike again. So you know what, I'm going to book profit on my tech stocks. And I'm going to buy some of this new supply of Treasuries that have come online. So it could trigger a rotation of assets out of stocks and into these new bonds. So technically, I mean, I kind of see what he's saying, but it does stink a little bit of him just being a slave to his own bias. But that being said, back to the fact it's a market rally that's incredibly narrow. Anything, anything, anything, anything that hints that tech is at a top, then fine, you're going to get this rally coming off quite sharply.

Yeah, I guess that was his takeaway point, that the market's pricing perfection on a number of different points.

Yeah.

And that never ends well. And we're not talking about a, you know, catastrophic fall in markets, just an end, um, I guess it's an end to the bear market rally, right? All right, well, look, quick summary then, just to wrap up last few minutes on the debt ceiling. So the latest, i.e., as of Friday the 26th of May, we're recording this— Republican and White House negotiators are moving closer to an agreement to raise the debt limit and cap federal spending for 2 years. That's according to people familiar with the matter. Under the terms of the emerging agreement, defense spending would be permitted to rise 3% next year, in line with Biden's budget request. Uh, the accord would also include a measure to upgrade the nation's electric grid to accommodate renewable energy, which is a key climate goal. So win for the administration. But on the flip side, they're also going to speed up permits for pipelines and other fossil fuel projects. Which the GOP favor. Yeah, that's just laughable. I mean, anyway, so should a deal be reached soon? I guess some of the key points here is timing. So Tuesday is emerging as a likely day for a House vote. So obviously they've got to make an agreement first, but the signs are they're getting close to this. And if that is the case, they've got quite a pressurized, um, schedule that they need to hit So Tuesday is emerging as likely day for the House vote. The Senate would then have to act quickly because it has to go through both chambers of Congress, land on Biden's desk before the 1st of June. And that's the date by which Janet Yellen, the Treasury Secretary, has said her department will basically run out of money.

Yeah.

The following day after, so 2nd of June, that sees a payment due to millions of Social Security beneficiaries. So this is what's putting a bit of pressure on the— to resolve the impasse at the moment.

Yeah, the noises coming out of the Rose Garden yesterday, you gotta say, it still looks like it's pretty much done. I mean, they were very positive. Like, if you were going to have a government shutdown, then you would need the two parties to still be a long way apart. And what they were talking about yesterday seems like seems like they're actually pretty much there. So, you know, obviously the litmus test comes when it tries to get through Congress, when the bill tries to get passed through Congress, but most likely they're not going to attempt to pass the bill unless they know they've got the numbers to get the votes, right? So yeah, I don't know. At the moment it looks, looks like they're, they're, they're pretty much there.

It's all a bit boring, isn't it?

Yeah.

Come on. I would have been like, you got to throw a Trump in at this point and just blow up the deal. Just say, no deal, duff.

But you could say— my final point— you could say a deal being done is negative for stocks because it means spending increases, which is inflationary. You could say government spending has been out of control, and that's why we got inflation in the first place. And here's Biden wanting to spend more and spend more and spend more. So you could say the deal getting done without any problems is inflationary, which means the Fed can't cut and maybe need to continue to hike. So maybe there is a negative argument to be spun out of a deal getting done here.

Yeah. Mike was speed dialing his hitman on you about 10 minutes ago. Now he's calmed down a little bit. It's okay, Mike. Just chill, he's fine. All right, so that's it for this week. Thanks very much for, for listening. As we said before, we'll have the Global Markets Wrap Up as per normal with Piers and myself every Friday. We've got the More of a Corporate Finance Spin with Stephen coming at you on Wednesday every week. So remember to follow the channel, hit the bell icon so you get notified when the new episodes come out. But have a wonderful weekend if you are in the UK. It's a long one again, so Enjoy the sun, and thanks, Biz.

Take care, have a good weekend.