James Bevin, J. P. Morgan, Bank America discussed on Bloomberg Surveillance
Bloomberg Television. Good morning in the heart of earning season mornings of seven now further earnings today, But John We all await Microsoft today to see what big technology does across this nation, then onto Apple tomorrow, then onto Amazon this coming Thursday, and that's where the earnings growth has been for a long Long time Tom. The story's changed, though it's about the year on year base effects on the base effects for the big tank place a little bit more complex than, say the base effects for some of the cyclical companies. But the story for me has been repeated by Morgan Stanley. Demand is good. Can we meet it with supply? Can we execute? And it's the execution risk that gets a little bit more interesting in the weeks to come, is these numbers pour in and what's so important about these numbers? John is what we saw with Apple yesterday. It's to America's. There's this America almost guilty from their prosperity. And another America in this natural disaster flat on its back political risk political risk around wages, political risk around the taxes you pay on. These companies want to put themselves out front as part of the solution. Part of the solution before anyone concludes the part of the problem. It does something about it. I think Washington D C parts of it. Tom have already made their mind up that they're part of the problem and they want to do something about it. And the Federal Reserve is doing get spit to keep things loose for a long, long time. While this government this administration's gonna start doing it's been a whole lot more to the president of the speech, and Jerome Powell the speeches press conference tomorrow, Lisa, I think one of the observations you bad in this stew of politics is simply the labor shortage that is here right now. We're hearing about that in earnings releases. And how does that translate into persistent wage growth, right? I mean, basically, people say it's Here. This is for you Town transitory, And they've continued to say that with respect to all of the inflationary pressures but going forward. Is this going to be transitory, Especially if there isn't a change in the immigration policy, John that is for you in order to get people here. Two of employees to work force for these companies that are saying they were sure used to let him have another drink. Any excuse? I mean the issue right now, when I'm with you, Lisa, I really am. Is it transitory? Is it persistent? Persistent? Will it be like that saying it is a transitory? Is it persistent? I loved her in this. But that is the issue right now for the Federal Reserve to can we meet that demand with supply And to what degree has the entitlement spending the fiscal effort? How bank that supply Just choke things off a little bit. When do we start to bite that in the months to come to and then the other thing is to have the courage to be in this is get through the day and we've got a wonderful guest to begin here on the courage to be in the equity market. Given all of the transitory themes we speak of, John, help me out here. I've got green on the screen. I mean, I'm sorry. It's an equity market with a bid. Yeah, but he's doing okay. Tell my pull most attentive 1% the S and P 41 83 years under 17 by better basis. 170.1 57 90 too intense and you're a geologist totally unchanged. 1 2086. I think Lisa mentioned something. Additionally, this morning. In addition to all the great things that Lisa talks about is just the lack of response in this equity market to some of the big beats so far that we've seen and I can say safely that ups is in. One of those names this morning was just deliver some really nice numbers, and it's absolutely charging on some higher. Fremont Jonah Story for May. I want to get to it right now. That's what we do with Bloomberg Surveillance and you see it in the London metals Exchange. The LME. John and I adored. I particularly endure their their annual convention that they have in London at the Dorchester and John. I'm sorry. Copper. 10,000 is cause for celebration the high since March, 20. Leavitt for Copper. That story continues higher prices. The miners are doing better off it better demand outlook and trying to supply maybe the issue there to want to bring in checks. Bevin of CCF Investment Officer James You like the miners right now in Europe. Oh, I absolutely do. I think there's some great quality opportunities and what I would said. Interestingly, is the ratio between the copper price on the gold price suggest to me that 10 Year U. S Treasury you should know being around 2.5 Cent. Now we know it's not that principally because Japanese investors have bean buying facing almost zero yields within their own market, But I would have a side bet with you, but we will see the 10 Year Yields Act 2% by the end of the calendar year. And that's a better city. Big move. Given that we only got through 1% on the first trading day of the current county here. Is that a move that looks like the movie starring Cuba. Wanna move this accompanied by better banks. At a bank stock performance. Better cyclical performance, but a small cap performers to the cyclicals perform in line with that move higher on twos on tens, So to me, I don't think they do. I think interesting and very different time. I would observe the bites on our war wash with overnight posits that extremely bad news banks seeking tol lend on What they want our time deposits. They want long term deposits that it wanted Honey's and I think, therefore that the banks have had their day in the sun. I would only in the case. States want to be invested in J. P. Morgan and Bank America, both of which I think have excellent opportunities. Cough support. Long time return the middle Bank ranking banks or, however, again really, really struggle and that I would say is going to be one of the challenges for Was writ large. They discount a lot of bad years when I'm looking at six because today I'm looking at the best quality defensive suit to someone telecommunication companies. Some drinks companies like the energy, which I still think it's too cheap. James Bevin. I want you to rationalize 35 Times earnings might want estimated. Microsoft is the 12 months. Forward view is 35 times earnings justify owning Microsoft right now. Let let me rationalize it by talking about the earnings yield. Rob Price earnings multiple because, of course, the earnings Hell, these the price earnings multiple reversed don't earnings fields of 3% needs to.