00:00If we are concentrating back and forth between deficits and trade, it's really hard, Kate, to understand whether this is all good for duration or bad for duration.
00:10Because presumably, it tears back on recession. I want to go buy bonds. But if it's recession plus higher deficits, can you?
00:18Well, let's take a look at the global picture here, too, because all aspects of this kind of also hinge on what international buyers and global investors might do, right?
00:28You know, if we are putting pressure on all of our trading partners, if it's a really difficult environment for global asset allocators, and they're asking this question, how much should we own in the U.S.?
00:39That's going to have an impact. So it's not just, you know, our own growth prospects or our own policy, but also decisions that global pension funds are making about whether or not they want to own long-duration assets,
00:50whether or not they want to add incremental risk to U.S. equities, even if they're the highest quality in the world.
00:55So there's this other element that we're trying to factor in, in terms of positioning and sentiment and technicals, all while we're getting, you know, policy headlines one by one by one.
01:05And this is what I will say. You know, we have been neutral on equities. We prefer to stay in kind of the large cap space when we can.
01:11I'd say that's, like, very close to benchmark. It's very conservative on that front.
01:16And I would love to be in a place where I could say, like, let's buy. It's time. I just don't see...
01:20That would be great for you and your job, wouldn't it?
01:22It would be. It would be much better than saying, hey, like, hold steady. We don't want to add to risk right now, which everyone gets really tired of hearing me say.
01:29But it feels like the prudent thing to do for a, you know, diversified multi-asset fund.
01:34Is there anything, though, that you love? Like, is there any strategy that you wake up and you're excited about?
01:39If somebody comes to you and says, Kate, I have to invest this million dollars now. What should I do?
01:45Yeah. I'm an AI lover. I mean, that feels a little bit consensus, maybe a little bit less consensus than it was at the end of 2024.
01:52But I believe that any company that doesn't invest in AI and technology and software, training their people, is going to face, you know, an incredible threat to their performance and their competitive standing as we move forward.
02:06And so I believe this is going to be like a durable place of spend. And companies that benefit from that spend are going to have more consistent earnings in this period of macro volatility.
02:16So, you know, I get a little bit less fussy around valuations of these companies that have incredible tools and platforms, because I just don't think any individual or any company can afford to step away from making these technology investments in this environment.
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