Bloomberg Audio Studios, Podcasts, radio news. This is the Bloomberg Daybreak Asia podcast. I'm Doug Krisner. You can join Brian Curtis and myself for the stories making news and moving markets in the Apec region. You can subscribe to the show anywhere you get your podcast and always on Bloomberg Radio, the Bloomberg Terminal, and the Bloomberg Business app. Hillary Kramer, she is the CIO at Kramer Capital Research. Joining us here in the New York studio. Thanks for stopping by Sunday night us. Before we get into kind of the economics of what's happening right now, I'd like to serve a big picture here for a moment. I'd like to get from you first the profile of your average client and what you're hearing from that person right now, their concerns and how they're feeling about not only market action, but the economy globally.

Bloomberg Audio Studios, Podcasts, radio news. This is the Bloomberg Daybreak Asia podcast. I'm Doug Krisner. You can join Brian Curtis and myself for the stories making news and moving markets in the Apec region. You can subscribe to the show anywhere you get your podcast and always on Bloomberg Radio, the Bloomberg Terminal, and the Bloomberg Business app. Hillary Kramer, she is the CIO at Kramer Capital Research. Joining us here in the New York studio. Thanks for stopping by Sunday night us. Before we get into kind of the economics of what's happening right now, I'd like to serve a big picture here for a moment. I'd like to get from you first the profile of your average client and what you're hearing from that person right now, their concerns and how they're feeling about not only market action, but the economy globally.

My clients are are diversified internationally. Seventy percent are from non USA based, but all of them have a very similar profile interestingly, which is many are entrepreneurs, first generation professionals who have made money and with ancillary businesses, whether rolling up medical, surgical centers or lawyers that have become also doing roll ups or expertise in certain areas, a lot of manufacturing, a lot of export, especially in Asia. But the UF and the US profile is very very similar. Again, it's the professional who has made money. Very often in the US it's real estate based. They've bought their building, bought another building. So it's really important for me to be keyed into what they're thinking about. They come to me for equities, Okay, it's about stocks, not about wealth management or Portfoliolo planning or long term sort of wealth and generational interest. They want to know about stocks, what stocks to buy. That's my expertise. So what I'm hearing from them is concern about the stock market itself, especially my US based clients. There's so much concern about what's going to happen with tax policy based on who wins the election. Concerns that inheritance taxes are going to be one hundred percent of wealth, and there's a lot of geopolitical concern as well as concern about what the disasters might be. People are still traumatized by COVID and the unexpectedness of COVID.

My clients are are diversified internationally. Seventy percent are from non USA based, but all of them have a very similar profile interestingly, which is many are entrepreneurs, first generation professionals who have made money and with ancillary businesses, whether rolling up medical, surgical centers or lawyers that have become also doing roll ups or expertise in certain areas, a lot of manufacturing, a lot of export, especially in Asia. But the UF and the US profile is very very similar. Again, it's the professional who has made money. Very often in the US it's real estate based. They've bought their building, bought another building. So it's really important for me to be keyed into what they're thinking about. They come to me for equities, Okay, it's about stocks, not about wealth management or Portfoliolo planning or long term sort of wealth and generational interest. They want to know about stocks, what stocks to buy. That's my expertise. So what I'm hearing from them is concern about the stock market itself, especially my US based clients. There's so much concern about what's going to happen with tax policy based on who wins the election. Concerns that inheritance taxes are going to be one hundred percent of wealth, and there's a lot of geopolitical concern as well as concern about what the disasters might be. People are still traumatized by COVID and the unexpectedness of COVID.

It feels fragile it feels like investors are nervous, and you wonder whether or not the asset class is something that people feel much trust in. This has been, by some accounts, pretty amazing year. You have a killer app, you have a killer store, a trend in AI. We're still waiting to see how it plays out. But that's one good thing. We have the Fed now looking to cut interest rates, inflation coming under control, and the economy doing well. Why does it feel so fragile?

It feels fragile it feels like investors are nervous, and you wonder whether or not the asset class is something that people feel much trust in. This has been, by some accounts, pretty amazing year. You have a killer app, you have a killer store, a trend in AI. We're still waiting to see how it plays out. But that's one good thing. We have the Fed now looking to cut interest rates, inflation coming under control, and the economy doing well. Why does it feel so fragile?

Then?

Then?

It feels fragile because we're looking for bad news to give us good news. Right, So that job number on Friday, you know, the fact that there's a weakness in the in the growth in employment and jobs means that rates are going to be cut. But now it seems like did the Fed not do enough? You know, did they not act fast enough? Right, it's been four years since since we've had any kind of cuts, since twenty two, while we've had all these you know, this raising of interest rates. So I think there's this incredible concern that people are drowning in debt. And I just wish everyone would look at participation, labor rate, participation more to realize that we have this whole baby boomer generation here in the US born between nineteen forty six and nineteen sixty four. And the latter part of that, those that you know didn't weren't on the bandwagon fast enough, or the ladder was pulled up, you know, when it was their turn to climb. They don't have savings, they don't have a lot of money, and a lot of people are really leveraged up. And we're also in an equity market that's about you know, memes and gossip. And the problem is all the rules have changed.

It feels fragile because we're looking for bad news to give us good news. Right, So that job number on Friday, you know, the fact that there's a weakness in the in the growth in employment and jobs means that rates are going to be cut. But now it seems like did the Fed not do enough? You know, did they not act fast enough? Right, it's been four years since since we've had any kind of cuts, since twenty two, while we've had all these you know, this raising of interest rates. So I think there's this incredible concern that people are drowning in debt. And I just wish everyone would look at participation, labor rate, participation more to realize that we have this whole baby boomer generation here in the US born between nineteen forty six and nineteen sixty four. And the latter part of that, those that you know didn't weren't on the bandwagon fast enough, or the ladder was pulled up, you know, when it was their turn to climb. They don't have savings, they don't have a lot of money, and a lot of people are really leveraged up. And we're also in an equity market that's about you know, memes and gossip. And the problem is all the rules have changed.

So when you make a recommendation on the equity side, is it a defensive position.

So when you make a recommendation on the equity side, is it a defensive position.

Inherented I have, well, I buy fur kate it so much. I have my growth stocks, you know, and I try to get into them very very early. I often recommend that my clients sell way too soon, but that's because I want to. I want them to live for the next day. But of course we've been to this huge bull market. But I also love those stocks that are the stealth stocks, or the fallen angels as I call it. I mean, some of these fallen angels are actually very interesting. And now that I mean you've asked me, I can even give you an example to explain what I mean by the fallen angel. You have a company like newal Brands NWL. It's under ten dollars. Newell makes rubber Maid, Sharpies, paper Mate, Yankee, Candle, and Coleman for anyone that's camping equipment. For anyone who thinks we're going to end up all living in caves and using gold and only gold is our currency. I mean, this is a great company, it's a perfect takeover, but under ten dollars, nobody's buying it because institutional investors have these mandates they can only buy stocks over fifteen dollars or ten dollars. And yet there's there's actual growth maybe single digits, and there's a three point seven percent of in yield. So those are the kinds of things I find early at eight bucks that someone can turn around at sixteen or twenty and sell and have one hundred percent return.

Inherented I have, well, I buy fur kate it so much. I have my growth stocks, you know, and I try to get into them very very early. I often recommend that my clients sell way too soon, but that's because I want to. I want them to live for the next day. But of course we've been to this huge bull market. But I also love those stocks that are the stealth stocks, or the fallen angels as I call it. I mean, some of these fallen angels are actually very interesting. And now that I mean you've asked me, I can even give you an example to explain what I mean by the fallen angel. You have a company like newal Brands NWL. It's under ten dollars. Newell makes rubber Maid, Sharpies, paper Mate, Yankee, Candle, and Coleman for anyone that's camping equipment. For anyone who thinks we're going to end up all living in caves and using gold and only gold is our currency. I mean, this is a great company, it's a perfect takeover, but under ten dollars, nobody's buying it because institutional investors have these mandates they can only buy stocks over fifteen dollars or ten dollars. And yet there's there's actual growth maybe single digits, and there's a three point seven percent of in yield. So those are the kinds of things I find early at eight bucks that someone can turn around at sixteen or twenty and sell and have one hundred percent return.

You've got some companies that have been darling, some a certain crowd, Palentteer for instance, Mobile Eye. They're in they're in areas of the market that people find attractive, but there's a lot of volatility there. I look at Palenteer stock, I mean, it's pretty much from the lower left to the upper right. But with a lot of hurkey jerky movements. You know, are you are you? Are you willing to put people in some of these seemingly more risky companies.

You've got some companies that have been darling, some a certain crowd, Palentteer for instance, Mobile Eye. They're in they're in areas of the market that people find attractive, but there's a lot of volatility there. I look at Palenteer stock, I mean, it's pretty much from the lower left to the upper right. But with a lot of hurkey jerky movements. You know, are you are you? Are you willing to put people in some of these seemingly more risky companies.

Pallenteer one hundred, one hundred percent. Palenteer to me is the true AI company. You know, when when we talk about Nvidia and arm and Qualcom and all these other companies that are in AI, you're really talking about semiconductors. And those of us who've been around the block a few times, we know that semiconductors are always volatile, and that they always have a cyclicality and they always become commoditized. A company like Pallenteer is true, true AI. It's just that they had to be very secretive because it was it's data analysis. It's using software and artificial intelligence to understand sets of data. But it was really the equivalent of the cias and nsas all over the world that we're using that are using Palenteer. But now Palenteer is helping companies like everyone from you know, the railroad companies to you know, making sure Kellogg's is selling enough pop tarts and to the right people. So now that that information can be out there, we really see some upside and Palenteer and they have the talent. It's not just another AI story. And look there's a lot of interesting it's actually very interesting. There's a report from Goldman Sachs September fifth called AI to Buy or not to buy? That is the question. Well, I mean, when you're talking about a report that's thirty five pages long, you're realizing that, you know, it's the companies like Palenteer that are actually like getting the revenue, getting the numbers that you really want to be in. And in terms of Mobile eye, can I can?

Pallenteer one hundred, one hundred percent. Palenteer to me is the true AI company. You know, when when we talk about Nvidia and arm and Qualcom and all these other companies that are in AI, you're really talking about semiconductors. And those of us who've been around the block a few times, we know that semiconductors are always volatile, and that they always have a cyclicality and they always become commoditized. A company like Pallenteer is true, true AI. It's just that they had to be very secretive because it was it's data analysis. It's using software and artificial intelligence to understand sets of data. But it was really the equivalent of the cias and nsas all over the world that we're using that are using Palenteer. But now Palenteer is helping companies like everyone from you know, the railroad companies to you know, making sure Kellogg's is selling enough pop tarts and to the right people. So now that that information can be out there, we really see some upside and Palenteer and they have the talent. It's not just another AI story. And look there's a lot of interesting it's actually very interesting. There's a report from Goldman Sachs September fifth called AI to Buy or not to buy? That is the question. Well, I mean, when you're talking about a report that's thirty five pages long, you're realizing that, you know, it's the companies like Palenteer that are actually like getting the revenue, getting the numbers that you really want to be in. And in terms of Mobile eye, can I can?

I you can very quickly. I was going to ask you one other questions, Oh to ask So, if I've been or a client has been in megacap tech, let's say over the last year, what would your vice be?

I you can very quickly. I was going to ask you one other questions, Oh to ask So, if I've been or a client has been in megacap tech, let's say over the last year, what would your vice be?

Uh, don't try to catch a falling knife, because you might think it's a bargain to have Nvidia at something under one hundred bucks, which it might go under excuse me, one hundred dollars in this week. It's at about one hundred and three right now, down from one hundred and forty, and it was ninety in early August. But think about this, twelve months ago. It was in the forties and video was in the forties. So these are companies that you know, yes, you know, Tesla's down twenty two percent, but it can be down a lot more. I mean, these companies that are this mega tech companies. Don't ever think that you found a bargain or you're smarter than the market. You know, That's that's the key.

Uh, don't try to catch a falling knife, because you might think it's a bargain to have Nvidia at something under one hundred bucks, which it might go under excuse me, one hundred dollars in this week. It's at about one hundred and three right now, down from one hundred and forty, and it was ninety in early August. But think about this, twelve months ago. It was in the forties and video was in the forties. So these are companies that you know, yes, you know, Tesla's down twenty two percent, but it can be down a lot more. I mean, these companies that are this mega tech companies. Don't ever think that you found a bargain or you're smarter than the market. You know, That's that's the key.

Okay, we'll leave it there. Pleasure to have you on the program. Hillary Kramer see iowe it Kramer Capital Research joining us here on a daybreak.

Okay, we'll leave it there. Pleasure to have you on the program. Hillary Kramer see iowe it Kramer Capital Research joining us here on a daybreak.

Asia Luke Stone, portfolio manager at when Through Capital Management. Luke, So, we heard Yellen saying there are no red lights flashing in the economy, but the market interpretation of the jobs report seems a little bit of a different mindset for you. Is this a time to be cautious or to be opportunistic?

Asia Luke Stone, portfolio manager at when Through Capital Management. Luke, So, we heard Yellen saying there are no red lights flashing in the economy, but the market interpretation of the jobs report seems a little bit of a different mindset for you. Is this a time to be cautious or to be opportunistic?

Yeah, First, thank you very much for having me. I think Jones or Jenny Allen's remarks this weekend kind of flew in the face of the way the market reacted, just as you said. I mean, we're starting to see some deterioration in the macro economic landscape, with unemployment starting to tick upward and continuing to see job growth not only fall below expectations, but really growing in places that aren't the highest skilled or necessarily the most demanded jobs that we're looking for. So I think that there's a little bit of room for caution. Now when you translate that to FED activity, I think it gets a little difficult.

Yeah, First, thank you very much for having me. I think Jones or Jenny Allen's remarks this weekend kind of flew in the face of the way the market reacted, just as you said. I mean, we're starting to see some deterioration in the macro economic landscape, with unemployment starting to tick upward and continuing to see job growth not only fall below expectations, but really growing in places that aren't the highest skilled or necessarily the most demanded jobs that we're looking for. So I think that there's a little bit of room for caution. Now when you translate that to FED activity, I think it gets a little difficult.

Yeah.

Yeah.

I was struck by the fact that the Atlanta Fed's GDP now model is indicating third quarter real growth of around two point one. Yeah, that's down from roughly three percent just a few weeks ago, but it's not too shabby. I mean, given the fact that rates have been as high for as you know, as they have been for quite some time. I mean, I don't think it's recessionary territory. Are you getting that vibe?

I was struck by the fact that the Atlanta Fed's GDP now model is indicating third quarter real growth of around two point one. Yeah, that's down from roughly three percent just a few weeks ago, but it's not too shabby. I mean, given the fact that rates have been as high for as you know, as they have been for quite some time. I mean, I don't think it's recessionary territory. Are you getting that vibe?

No, I think that's a great point.

No, I think that's a great point.

I mean you're seeing what appears to be relatively robust GDP GDP growth in economic activity. So when you start to see like FED Governor's Fed Governor Waller's comments on front loading rate cuts, or you know, look three weeks ago, when we were facing the Japanese mini crisis, the larger majority of market participants were demanding even emergency rate cuts, I think that's a little off base, and you need to look at kind of where we are from a big picture standpoint.

I mean you're seeing what appears to be relatively robust GDP GDP growth in economic activity. So when you start to see like FED Governor's Fed Governor Waller's comments on front loading rate cuts, or you know, look three weeks ago, when we were facing the Japanese mini crisis, the larger majority of market participants were demanding even emergency rate cuts, I think that's a little off base, and you need to look at kind of where we are from a big picture standpoint.

When you cling to data dependence, as we heard Chris Waller mentioned there, it probably means you're going to be late that the horses have already bolted. Do you think that's the case now or no?

When you cling to data dependence, as we heard Chris Waller mentioned there, it probably means you're going to be late that the horses have already bolted. Do you think that's the case now or no?

Yeah, I think that's probably it's fair.

Yeah, I think that's probably it's fair.

But by the same token, I you know, I think that's just the mechanism of how this fed that a reserve is acting today. You know, I think they're largely concerned with the reputational risk that flew when we started to see inflation tick upward. And I think that's why we're starting to see demands for cuts so that we aren't really seeing so we won't see a huge economic slowdown coming up.

But by the same token, I you know, I think that's just the mechanism of how this fed that a reserve is acting today. You know, I think they're largely concerned with the reputational risk that flew when we started to see inflation tick upward. And I think that's why we're starting to see demands for cuts so that we aren't really seeing so we won't see a huge economic slowdown coming up.

So, given everything that you're describing, Luke, how do you approach putting money to work in the equity market right now?

So, given everything that you're describing, Luke, how do you approach putting money to work in the equity market right now?

Yeah?

Yeah?

In the equity space, you know, look, this is this is kind of a boring time, at least in my opinion. I think we look toward value. I think that we've seen some large contractions and year to date, you know, the S and P is still up well roughly eighteen fifteen percent year to date. I mean that that's still pretty strong. I think there's there's room there to kind of take some take some wind out and take some profits. So that's in the equity space, you know, I think we're starting to see more allocations into the fixed income world with rates starting to fall as they have. If we're expecting rates to continue to fall, that's we kind of like defensive names and duration.

In the equity space, you know, look, this is this is kind of a boring time, at least in my opinion. I think we look toward value. I think that we've seen some large contractions and year to date, you know, the S and P is still up well roughly eighteen fifteen percent year to date. I mean that that's still pretty strong. I think there's there's room there to kind of take some take some wind out and take some profits. So that's in the equity space, you know, I think we're starting to see more allocations into the fixed income world with rates starting to fall as they have. If we're expecting rates to continue to fall, that's we kind of like defensive names and duration.

The S and P five hundred down, you know, more than four percent last week, and I just happened to have the Wei function up and it's it's up thirteen percent now here today. So I'm wondering if we get any further downside, does that suggest that this year in aggregate, when it's all said and done, will be disappointing even with AI.

The S and P five hundred down, you know, more than four percent last week, and I just happened to have the Wei function up and it's it's up thirteen percent now here today. So I'm wondering if we get any further downside, does that suggest that this year in aggregate, when it's all said and done, will be disappointing even with AI.

Well, look, I mean it's it's it's hard to be excited when when you know, I think last week, like you said, the S and P was closer to twenty percent, and there's these you know, robust technologies that are starting to grow, you know, with AI, I don't think that the year is completely lost. I mean, I mean, look, we're coming off of a year where we.

Well, look, I mean it's it's it's hard to be excited when when you know, I think last week, like you said, the S and P was closer to twenty percent, and there's these you know, robust technologies that are starting to grow, you know, with AI, I don't think that the year is completely lost. I mean, I mean, look, we're coming off of a year where we.

Saw a huge detraction in the S and p. So you know, anything's good when you're.

Saw a huge detraction in the S and p. So you know, anything's good when you're.

Facing you know, we don't want to be here, right, I guess that's that's that's what I'm trying to say there.

Facing you know, we don't want to be here, right, I guess that's that's that's what I'm trying to say there.

How are you looking at marketsoft shore right now, particularly in Asia?

How are you looking at marketsoft shore right now, particularly in Asia?

Yeah, I think we're looking to China. And I feel like every time I'm on this program, I start to say that we're beginning to think about looking at China, and I.

Yeah, I think we're looking to China. And I feel like every time I'm on this program, I start to say that we're beginning to think about looking at China, and I.

Think that's that's still fair. I think China.

Think that's that's still fair. I think China.

Specifically has its own issues with inflation, which is almost on the other side of the coin. Right. You know, you're seeing deflationary pressure on the business side, and then you know, pretty meager inflation in their consumer price index, and you're starting to see more and more central bankers in the in the region and even some x Chinese central bankers start to almost plead for rate cuts or more accommodative monetary policy and and uh stimulating fiscal policy. So we'd like to ride that wave if we think that it's it's going to happen, But it seems like there's some reticency on.

Specifically has its own issues with inflation, which is almost on the other side of the coin. Right. You know, you're seeing deflationary pressure on the business side, and then you know, pretty meager inflation in their consumer price index, and you're starting to see more and more central bankers in the in the region and even some x Chinese central bankers start to almost plead for rate cuts or more accommodative monetary policy and and uh stimulating fiscal policy. So we'd like to ride that wave if we think that it's it's going to happen, But it seems like there's some reticency on.

The Chinese government side to provide that.

The Chinese government side to provide that.

Doug mentioned a few moments ago that Yellen maintained that she would welcome a meeting with her counterpart Holyphom in the United States. Is the climate right now for for that sort of visit or do you think that would be something that might happen later.

Doug mentioned a few moments ago that Yellen maintained that she would welcome a meeting with her counterpart Holyphom in the United States. Is the climate right now for for that sort of visit or do you think that would be something that might happen later.

Well, you know, the climate is is right right now, you know, depending on which administration we we see come to power in the following year.

Well, you know, the climate is is right right now, you know, depending on which administration we we see come to power in the following year.

I think that's probably fair.

I think that's probably fair.

I mean, I think, look, I think it benefits, but parties to welcome each other with open arms and bringing forward to a trade war or having any negative attitude is just harmful to both parties.

I mean, I think, look, I think it benefits, but parties to welcome each other with open arms and bringing forward to a trade war or having any negative attitude is just harmful to both parties.

So you open the door. How are you feeling about the election? We've got a debate tuesday. I think the stakes are very, very high. Do you have a sense of what one candidate may mean for the economy and the markets over the other.

So you open the door. How are you feeling about the election? We've got a debate tuesday. I think the stakes are very, very high. Do you have a sense of what one candidate may mean for the economy and the markets over the other.

Well, I think both have their own I'd say can of worms when it comes to fiscal policy, right, I think both of them are overly stimulative, stimulative to a certain extent, and when you couple that with dead policy that you know is supposed to remain independent, we might see the potential for inflationary pressures, whether that be through President Trump's potential tax policy. You know, if he completely wipes away the come tax and focuses on tariffs, that's even wilder. But then you know the Harris administration's proposals for you know, stimulus for first time home buyers, essentially putting twenty five thousand dollars in individual's pockets, I think that would cause significant price pressure in the housing market, which you know doesn't really have much room to go.

Well, I think both have their own I'd say can of worms when it comes to fiscal policy, right, I think both of them are overly stimulative, stimulative to a certain extent, and when you couple that with dead policy that you know is supposed to remain independent, we might see the potential for inflationary pressures, whether that be through President Trump's potential tax policy. You know, if he completely wipes away the come tax and focuses on tariffs, that's even wilder. But then you know the Harris administration's proposals for you know, stimulus for first time home buyers, essentially putting twenty five thousand dollars in individual's pockets, I think that would cause significant price pressure in the housing market, which you know doesn't really have much room to go.

You know, we usually think of inflation as a monetary issue, but are we learning through the past couple of years that it very much can be a fiscal issue as well. Yeah.

You know, we usually think of inflation as a monetary issue, but are we learning through the past couple of years that it very much can be a fiscal issue as well. Yeah.

Absolutely.

Absolutely.

I think when when you when you have an almost six percent deficit that you're running the GDP, I think that starts to flesh out some some true stimulative base on the on the fiscal side. So you know, whatever's going on on the on the monetary side, I think you have to reconcile that, you know, the government spending money is stimulative and has its implications for inflation.

I think when when you when you have an almost six percent deficit that you're running the GDP, I think that starts to flesh out some some true stimulative base on the on the fiscal side. So you know, whatever's going on on the on the monetary side, I think you have to reconcile that, you know, the government spending money is stimulative and has its implications for inflation.

All right, Luke, out of time unfortunately, but thank you for joining us here on a Monday morning in Asia. Luke Stone, portfolio manager at Winthrop Capital Management. Frank Lenz, founder and CEO of fi L to take a closer look at the US presidential election and also the debate coming up just in the next couple of days. Mister Lenz, thank you very much for joining us. We've had some recent polls showing that it's a neck and neck race. I'm curious if President Trump or former President Trump is losing more Republicans though too, Kamala Harris.

All right, Luke, out of time unfortunately, but thank you for joining us here on a Monday morning in Asia. Luke Stone, portfolio manager at Winthrop Capital Management. Frank Lenz, founder and CEO of fi L to take a closer look at the US presidential election and also the debate coming up just in the next couple of days. Mister Lenz, thank you very much for joining us. We've had some recent polls showing that it's a neck and neck race. I'm curious if President Trump or former President Trump is losing more Republicans though too, Kamala Harris.

He's losing some Republicans. He's been losing some Republicans since the very beginning of the race. But she herself is in our polling a percenter to a head. So the battle right now is really with the independence, the swing voters, the undecided. Roughly five percent of Americans have not made up their minds, which is actually incredible when the difference between the two candidates is wider and broader than any campaign that I've experienced in my lifetime, and the two of them have completely different personalities, they have different records, and it's surprising that people have still not made up their minds at this late point.

He's losing some Republicans. He's been losing some Republicans since the very beginning of the race. But she herself is in our polling a percenter to a head. So the battle right now is really with the independence, the swing voters, the undecided. Roughly five percent of Americans have not made up their minds, which is actually incredible when the difference between the two candidates is wider and broader than any campaign that I've experienced in my lifetime, and the two of them have completely different personalities, they have different records, and it's surprising that people have still not made up their minds at this late point.

Does it surprise you that this race is as close as it is.

Does it surprise you that this race is as close as it is.

Yes, it does.

Yes, it does.

I believe that Trump would have beaten Biden if Joe Biden was the Democratic nominee. I think that Kamala Harris has an advantage over Trump right now, and in fact, if the election were held today, I think she would win, but only by a percent or two. And remember the actual popular vote doesn't matter, and so any discussion of polling nationwide polling is really irrelevant. There are seven states in play. Those seven states is what matters. And it's fascinating to me that the most important issue isn't the economy. It isn't actually even inflation. It's affordability, and that is a Trump's strength at Harris weakness. But then you go to the personalities. You compare Harris and Trump, and Harris is more popular as an individual than Trump is, which is why this is such a close race.

I believe that Trump would have beaten Biden if Joe Biden was the Democratic nominee. I think that Kamala Harris has an advantage over Trump right now, and in fact, if the election were held today, I think she would win, but only by a percent or two. And remember the actual popular vote doesn't matter, and so any discussion of polling nationwide polling is really irrelevant. There are seven states in play. Those seven states is what matters. And it's fascinating to me that the most important issue isn't the economy. It isn't actually even inflation. It's affordability, and that is a Trump's strength at Harris weakness. But then you go to the personalities. You compare Harris and Trump, and Harris is more popular as an individual than Trump is, which is why this is such a close race.

It is extraordinary that the two candidates have such different positions. You would think that the former president Trump would mainly appeal to the core MAGA crowd. And so if you look at those seven states that you say are very much in play and will determine the outcome of this election, is mega particularly strong in those areas or.

It is extraordinary that the two candidates have such different positions. You would think that the former president Trump would mainly appeal to the core MAGA crowd. And so if you look at those seven states that you say are very much in play and will determine the outcome of this election, is mega particularly strong in those areas or.

No, it's a different kind of vote.

No, it's a different kind of vote.

For example, in Nevada and Arizona, the key is the Latino vote, and in that Trump is doing better than the average Republican does. It's a reason why he's tied even though he lost those states in twenty twenty.

For example, in Nevada and Arizona, the key is the Latino vote, and in that Trump is doing better than the average Republican does. It's a reason why he's tied even though he lost those states in twenty twenty.

Then you have to go to.

Then you have to go to.

The southern vote, where Trump had a significant advantage over Biden, but Harris's caught up or even moved ahead in some polls in Georgia and North Carolina. There the young African American vote, the young male African American vote, is going to be critical. Then you go up north to Pennsylvania, Michigan, and Wisconsin, and in those states the union vote matters. Now, make no mistake, Harris is winning the vast majority of government unions and teachers' union votes, but he's doing surprisingly well among the people, the trades, the people work with their hands, and it's one of the reasons. Right those three states, even though Joe Biden won them, those three states are too close to call.

The southern vote, where Trump had a significant advantage over Biden, but Harris's caught up or even moved ahead in some polls in Georgia and North Carolina. There the young African American vote, the young male African American vote, is going to be critical. Then you go up north to Pennsylvania, Michigan, and Wisconsin, and in those states the union vote matters. Now, make no mistake, Harris is winning the vast majority of government unions and teachers' union votes, but he's doing surprisingly well among the people, the trades, the people work with their hands, and it's one of the reasons. Right those three states, even though Joe Biden won them, those three states are too close to call.

Frank, imagine a world where you're involved in debate prep on both sides. What are the punches that Trump has to land? What are the punches that Harris has to land?

Frank, imagine a world where you're involved in debate prep on both sides. What are the punches that Trump has to land? What are the punches that Harris has to land?

Okay, I was expecting you to ask that question, so I've actually prepared an answer.

Okay, I was expecting you to ask that question, so I've actually prepared an answer.

Come on, turn the paper over and just speak off the cover.

Come on, turn the paper over and just speak off the cover.

No, because I actually want to get this right, and I suggest listeners write it down and you can do your own checklist of whether they succeed. Harris's she is doing very well, extremely well among young women. They back her overwhelmingly. They were disengaged in the election. I think she should appeal to them directly, look straight into the camera and speak to them about their future and how her future is tied to their future. Second, she needs a detailed plan of action because her criticism that Trump's been all over on is that she is changing, she's flip flopping, and she doesn't have any actual policies. Third, her greatest weakness is inflation. And yes it is down, as Bloomberg's been reporting for months now, but the Publicicey's prices is being significantly higher than twenty twenty. She has to have a specific answer to affordability. Fourth, she needs to ask a very simple question, which Kennedy's don't do them to do five for each one? Do you really want this chaos every single day because the public does not. And Fifth, and will only happen once when she gets interrupted, as Trump will inevitably do. She needs to say something like it's time that we had a president who respected mothers, daughters, sisters.

No, because I actually want to get this right, and I suggest listeners write it down and you can do your own checklist of whether they succeed. Harris's she is doing very well, extremely well among young women. They back her overwhelmingly. They were disengaged in the election. I think she should appeal to them directly, look straight into the camera and speak to them about their future and how her future is tied to their future. Second, she needs a detailed plan of action because her criticism that Trump's been all over on is that she is changing, she's flip flopping, and she doesn't have any actual policies. Third, her greatest weakness is inflation. And yes it is down, as Bloomberg's been reporting for months now, but the Publicicey's prices is being significantly higher than twenty twenty. She has to have a specific answer to affordability. Fourth, she needs to ask a very simple question, which Kennedy's don't do them to do five for each one? Do you really want this chaos every single day because the public does not. And Fifth, and will only happen once when she gets interrupted, as Trump will inevitably do. She needs to say something like it's time that we had a president who respected mothers, daughters, sisters.

And all women, even cat ladies.

And all women, even cat ladies.

That response will get tremendous attention.

That response will get tremendous attention.

Okay, you probably want to do the Trump side, but do it quickly. Maybe three important areas.

Okay, you probably want to do the Trump side, but do it quickly. Maybe three important areas.

Okay, he doesn't need to be nice, but he can't be mean. He doesn't need to be effusive, but he can't interrupt her again and again. Second, is showed the difference in crime, showed the difference in prices between himself and the Biden administration. And Third, he has to challenge her that she does a lot of talking, but she doesn't do.

Okay, he doesn't need to be nice, but he can't be mean. He doesn't need to be effusive, but he can't interrupt her again and again. Second, is showed the difference in crime, showed the difference in prices between himself and the Biden administration. And Third, he has to challenge her that she does a lot of talking, but she doesn't do.

A lot doing.

A lot doing.

You said that affordability was that number one issue, And I find it interesting that Trump is you know, he's talking about raising tariffs one hundred percent on quote unquote companies that don't want to do business with US dollar. Do people understand that that will drive prices up?

You said that affordability was that number one issue, And I find it interesting that Trump is you know, he's talking about raising tariffs one hundred percent on quote unquote companies that don't want to do business with US dollar. Do people understand that that will drive prices up?

They absolutely do not understand that. They do not understand the impact of trade, which is why there are a lot of Americans who back what Trump is saying, not realizing that the impact of what he's saying will actually cost them dearly. And it's something that Harris is going to have to explain because she doesn't get the benefit of it since the public doesn't know about it.

They absolutely do not understand that. They do not understand the impact of trade, which is why there are a lot of Americans who back what Trump is saying, not realizing that the impact of what he's saying will actually cost them dearly. And it's something that Harris is going to have to explain because she doesn't get the benefit of it since the public doesn't know about it.

I was looking at a New York Times Siena pol and one of the things that struck me that Takamala Harris still faces a sizable share of voters who are saying that they need to know more about her. Can you give me a sense of why the biography, why the messaging has yet to penetrate.

I was looking at a New York Times Siena pol and one of the things that struck me that Takamala Harris still faces a sizable share of voters who are saying that they need to know more about her. Can you give me a sense of why the biography, why the messaging has yet to penetrate.

Yes, it's because she hasn't talked about the issues. She's only done a single interview. I don't think foreign viewers realize that she's been the presumptive nominee now for forty five days, and they know we Americans know nothing about her because she hasn't engaged the public. And on the other side, and on the flip side, Donald Trump engages too much, he's too available, He's got opinions or comments on everything. So she hasn't told her details, she hasn't given her plan, and he doesn't know how to keep quiet.

Yes, it's because she hasn't talked about the issues. She's only done a single interview. I don't think foreign viewers realize that she's been the presumptive nominee now for forty five days, and they know we Americans know nothing about her because she hasn't engaged the public. And on the other side, and on the flip side, Donald Trump engages too much, he's too available, He's got opinions or comments on everything. So she hasn't told her details, she hasn't given her plan, and he doesn't know how to keep quiet.

Well, she did a little at the DNC in her speech. I'm curious whether you think you do Americans want to hear from her her great immigrant story, or do they want to hear more that she is a red blooded American.

Well, she did a little at the DNC in her speech. I'm curious whether you think you do Americans want to hear from her her great immigrant story, or do they want to hear more that she is a red blooded American.

I don't think either. I actually don't think either is important.

I don't think either. I actually don't think either is important.

I think they need to know from her exactly what she's going to do on the two issues. Actually, let's say it, the four issues that matter. Two of them benefit Trump, two of them benefit Harris. Affordability and immigration because we have a real problem with that in our country, at least a perceived problem. And then abortion, which is very good with her and younger women, and healthcare, which affects everyone. They want to know exactly what she's going to do, how much control of healthcare is the government versus private, what she's going to do to secure the border, what she's going to do with affordability. She's talked a little bit about it, but not enough. And with abortion, that's her strong point. And Trump himself has been trying to moderate his position from twenty twenty. But yes, the public does want to hear more from her on the details.

I think they need to know from her exactly what she's going to do on the two issues. Actually, let's say it, the four issues that matter. Two of them benefit Trump, two of them benefit Harris. Affordability and immigration because we have a real problem with that in our country, at least a perceived problem. And then abortion, which is very good with her and younger women, and healthcare, which affects everyone. They want to know exactly what she's going to do, how much control of healthcare is the government versus private, what she's going to do to secure the border, what she's going to do with affordability. She's talked a little bit about it, but not enough. And with abortion, that's her strong point. And Trump himself has been trying to moderate his position from twenty twenty. But yes, the public does want to hear more from her on the details.

Frank, very quickly, thirty seconds. When you hear the fact that Liz Cheney has endorsed Kamala Harris, her father has as well, does that move the needle in one way or another?

Frank, very quickly, thirty seconds. When you hear the fact that Liz Cheney has endorsed Kamala Harris, her father has as well, does that move the needle in one way or another?

It would have been interesting if the two of them had endorsed Harris at the same time, rather than Cheney going for Liz Channey going first. Does it really matter? Actually, I don't think so, and I think that Bobby kennedy endorsement of Trump is only worth half a percent. But with so many states so close, everything matters.

It would have been interesting if the two of them had endorsed Harris at the same time, rather than Cheney going for Liz Channey going first. Does it really matter? Actually, I don't think so, and I think that Bobby kennedy endorsement of Trump is only worth half a percent. But with so many states so close, everything matters.

Well.

Well.

A fascinating session. And by the way, should they either one of them talk about China, give you ten seconds.

A fascinating session. And by the way, should they either one of them talk about China, give you ten seconds.

You have to do it because it's new show that matters, and there's some really contentious points of view and they don't agree on China.

You have to do it because it's new show that matters, and there's some really contentious points of view and they don't agree on China.

Yeah, well, if they don't understand affordability and higher tariffs, I don't know if they understand a lot of policy orient and responses on China. But Frank, thank you very much for joining us here. Frank Lunz, founder and CEO.

Yeah, well, if they don't understand affordability and higher tariffs, I don't know if they understand a lot of policy orient and responses on China. But Frank, thank you very much for joining us here. Frank Lunz, founder and CEO.

Of FI L.

Of FI L.

Well. The thirty first CIDIC CLSA Investor Forum gets under way this morning at the Grand Hyatt here in Hong Kong. The event brings together some of the region's biggest and brightest industry names. One of them joins us now in our studios in Hong Kong. It's Christopher Thomas, Chairman of Integrated Insights to take a closer look at the Sino US chip war. Christopher, thank you for coming into our studios. We had an interesting line this morning out of the Commercial Times in Taiwan saying that Intel we'll entrust the production of all of its chips below three nanometers to TSMC. So this is interesting because I mean, that's obviously at the cutting edge of development chips that are below three nanometers, and since Intel has been trying to develop its foundry further, it shows that there's a lot of trust here with TSMC and TSMC very much at the heart of this sort of Sino US chip war. So I'm curious where do you think we are at this? Does it get worse from here or better?

Well. The thirty first CIDIC CLSA Investor Forum gets under way this morning at the Grand Hyatt here in Hong Kong. The event brings together some of the region's biggest and brightest industry names. One of them joins us now in our studios in Hong Kong. It's Christopher Thomas, Chairman of Integrated Insights to take a closer look at the Sino US chip war. Christopher, thank you for coming into our studios. We had an interesting line this morning out of the Commercial Times in Taiwan saying that Intel we'll entrust the production of all of its chips below three nanometers to TSMC. So this is interesting because I mean, that's obviously at the cutting edge of development chips that are below three nanometers, and since Intel has been trying to develop its foundry further, it shows that there's a lot of trust here with TSMC and TSMC very much at the heart of this sort of Sino US chip war. So I'm curious where do you think we are at this? Does it get worse from here or better?

Well, I think there's a few things to keep in mind as we look at this. First of all, despite the fact that we've had this name of the chip war over the last five years, actually the industry has been extremely healthy, highly profitable, and actually grown faster during the time of the chip war, So this may not be the negative for the chip industry that people laid out to be. Secondly, specifically looking at Taiwan again, there's this been this desire from all parties to de risk from Taiwan due to the geopolitical situation, But actually Taiwan's percentage share of the global semiconductor industry has risen.

Well, I think there's a few things to keep in mind as we look at this. First of all, despite the fact that we've had this name of the chip war over the last five years, actually the industry has been extremely healthy, highly profitable, and actually grown faster during the time of the chip war, So this may not be the negative for the chip industry that people laid out to be. Secondly, specifically looking at Taiwan again, there's this been this desire from all parties to de risk from Taiwan due to the geopolitical situation, But actually Taiwan's percentage share of the global semiconductor industry has risen.

During that time.

During that time.

The world is more leveraged all around to Taiwan than previously.

The world is more leveraged all around to Taiwan than previously.

Where do things go forward?

Where do things go forward?

I think I would harken back to a survey that I did with a global Semiconductor alliance of about one hundred and fifty semi conductor executives that we just published a couple weeks back, and eighty five percent of executives in the semiconductor industry, and this is a smattering of executives from China to Taiwan Island, to Japan, the USA, Europe, et cetera. They expect that both the US and China will continue to erect barriers and further separate their semiconductor industries from each other. So they expect the dispute two, as we say, get worse, and that same percentage basically expects that there'll be two separate and distinct semiconductor supply chains that are built out between the two countries. But at the same time, they expect it to take more than five to ten years for those supply chains to get built. This is a long run industry where changes like these don't happen overnight.

I think I would harken back to a survey that I did with a global Semiconductor alliance of about one hundred and fifty semi conductor executives that we just published a couple weeks back, and eighty five percent of executives in the semiconductor industry, and this is a smattering of executives from China to Taiwan Island, to Japan, the USA, Europe, et cetera. They expect that both the US and China will continue to erect barriers and further separate their semiconductor industries from each other. So they expect the dispute two, as we say, get worse, and that same percentage basically expects that there'll be two separate and distinct semiconductor supply chains that are built out between the two countries. But at the same time, they expect it to take more than five to ten years for those supply chains to get built. This is a long run industry where changes like these don't happen overnight.

Is there something that we can look to in the kind of interregnum, I mean, maybe a period within that five year time frame where Japan steps up in a way that to add to its capacity to take some of the stress out.

Is there something that we can look to in the kind of interregnum, I mean, maybe a period within that five year time frame where Japan steps up in a way that to add to its capacity to take some of the stress out.

Well, I think that we've already seen Japan's step up. They have their own internal leading edge manufacturing company of Rapidness, which is building out capacity. There are two Nangus and below, and TSMC has been quite successful rapidly ramping up its Kromoto fab and they've mentioned that they're going to be building more. So Japan is just one example of a country that's doubling down and sort of picking up the mantle and renewing its interest in semiconductors. But at the same time, even if if you just simply do the mathematics, even if Japan were to meet all of its objectives or share, even if we were to build out the TSMC and Intel factories in the United States as per their specs, we're still going to have a very large percentage of global leading edge capacity on Taiwan island for quite some time. I think that's will probably never get to a point where the world is totally de risk. It's just impossible and too expensive.

Well, I think that we've already seen Japan's step up. They have their own internal leading edge manufacturing company of Rapidness, which is building out capacity. There are two Nangus and below, and TSMC has been quite successful rapidly ramping up its Kromoto fab and they've mentioned that they're going to be building more. So Japan is just one example of a country that's doubling down and sort of picking up the mantle and renewing its interest in semiconductors. But at the same time, even if if you just simply do the mathematics, even if Japan were to meet all of its objectives or share, even if we were to build out the TSMC and Intel factories in the United States as per their specs, we're still going to have a very large percentage of global leading edge capacity on Taiwan island for quite some time. I think that's will probably never get to a point where the world is totally de risk. It's just impossible and too expensive.

So in this world that you describe with parallel paths forward in the chip industry, a key question I think for many is does China's development continue apace or does it slow?

So in this world that you describe with parallel paths forward in the chip industry, a key question I think for many is does China's development continue apace or does it slow?

Now in that scenario, well, I think that you have to agree that or understand that semiconductors is a collection of niches. You can't simply look at one technology, one chip and say this is advancing, this is declining. And what I would say is that in certain specific areas where the bearers are lower, where the market in China is a very large percentage of the global market, and where there's a strong independent or indigenous supply chain in China already, you're going to see rapid progress. You see this with some compound semiconductors such as silicon carbide and in the power space, and then in addition and lagging edge semiconductor, So think of them as twenty eight nanimeters in below. First of all, there's very little global restrictions on the ability of trying to access those technologies, and most of those technological supply chains or semiconductor supply chains can be built independently in China today with commodity equipment at the leading edge. I think this is a real debate. It's very clear that under the current regime, it will be increasingly difficult to go below five nanimeter to three nanimeter to two nanometer under the current restrictions on using EUV and we haven't or we have not been able to observe a path around that so far to date. But you never know what some genius engineer would be able to figure out. But I think the thing we need to keep in mind when you think about the performance of leading EDGAI systems is that it can't be brought down simply to a node on a semiconductor chain.

Now in that scenario, well, I think that you have to agree that or understand that semiconductors is a collection of niches. You can't simply look at one technology, one chip and say this is advancing, this is declining. And what I would say is that in certain specific areas where the bearers are lower, where the market in China is a very large percentage of the global market, and where there's a strong independent or indigenous supply chain in China already, you're going to see rapid progress. You see this with some compound semiconductors such as silicon carbide and in the power space, and then in addition and lagging edge semiconductor, So think of them as twenty eight nanimeters in below. First of all, there's very little global restrictions on the ability of trying to access those technologies, and most of those technological supply chains or semiconductor supply chains can be built independently in China today with commodity equipment at the leading edge. I think this is a real debate. It's very clear that under the current regime, it will be increasingly difficult to go below five nanimeter to three nanimeter to two nanometer under the current restrictions on using EUV and we haven't or we have not been able to observe a path around that so far to date. But you never know what some genius engineer would be able to figure out. But I think the thing we need to keep in mind when you think about the performance of leading EDGAI systems is that it can't be brought down simply to a node on a semiconductor chain.

It's really about the capabilities.

It's really about the capabilities.

Of the entire system, which is the advanced packaging, the logic to memory integration, the type of models that are being used, how the data center set up. So there's a lot of things that Chinese companies could do outside of having the most advanced semiconductor manufacturing processes in order to get close on the performance varrier of an overall AI system.

Of the entire system, which is the advanced packaging, the logic to memory integration, the type of models that are being used, how the data center set up. So there's a lot of things that Chinese companies could do outside of having the most advanced semiconductor manufacturing processes in order to get close on the performance varrier of an overall AI system.

To say nothing of high bandwidth memory in that South Korea for the most part, s k heinech Samsung very quickly. Can you imagine a world where one of those companies were to kind of expand beyond just memory.

To say nothing of high bandwidth memory in that South Korea for the most part, s k heinech Samsung very quickly. Can you imagine a world where one of those companies were to kind of expand beyond just memory.

Well, I mean I think that today.

Well, I mean I think that today.

You know, Samsung has a successful logic business and it's actually making chips for their own phones and has been taking a look at aichips et cetera.

You know, Samsung has a successful logic business and it's actually making chips for their own phones and has been taking a look at aichips et cetera.

So it's already happened. I think that.

So it's already happened. I think that.

And you see in the foundry space for Samsung, they have a relatively solid foundry process and they've shown some good things on the most leading edge logic processes.

And you see in the foundry space for Samsung, they have a relatively solid foundry process and they've shown some good things on the most leading edge logic processes.

So I think you're going to see that.

So I think you're going to see that.

I think I'm not quite sure how you would make a new entry into the space if you were just starting up today. Extremely expensive, it's crowded, and it's very difficult to get in, all.

I think I'm not quite sure how you would make a new entry into the space if you were just starting up today. Extremely expensive, it's crowded, and it's very difficult to get in, all.

Right, Christopher, thank you for joining us here and coming into our studio. As Christopher Thomas, Chairman of Integrated Insights.

Right, Christopher, thank you for joining us here and coming into our studio. As Christopher Thomas, Chairman of Integrated Insights.

This has been the Bloomberg Daybreak Asia podcast, bringing you the stories making news and moving markets in the Asia Pacific. Visit the Bloomberg Podcast channel on YouTube to get more episodes of this and other shows from Bloomberg. Subscribe to the podcast on Apple, Spotify, or anywhere else you'll listen and always on Bloomberg Radio, the Bloomberg Terminal, and the Bloomberg Business app.

This has been the Bloomberg Daybreak Asia podcast, bringing you the stories making news and moving markets in the Asia Pacific. Visit the Bloomberg Podcast channel on YouTube to get more episodes of this and other shows from Bloomberg. Subscribe to the podcast on Apple, Spotify, or anywhere else you'll listen and always on Bloomberg Radio, the Bloomberg Terminal, and the Bloomberg Business app.