BlackRock's Li Sees US Equities, Corporates as 'More Exceptional'

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Transcript

00:00When you say we stay risk on, what does that mean in today's market?

00:04It means positive on U.S. equities and corporate in terms of credit over U.S. government bonds.

00:11I think what we have seen so far this year, especially this week, is that greater uncertainty

00:18doesn't mean greater certainty of a bad outcome. People make false equivalents between the two,

00:23but there is a huge, huge difference. So when we talk about kind of U.S. debt arithmetic,

00:28when we talk about supply chain dependency, this will govern how quickly decoupling can happen,

00:34if at all, which is why we were able to stay risk on despite elevated uncertainty in terms of policy

00:42making. I would also say we talk about U.S. equities recovering year to day. U.S. equities

00:48more than recovering the drawdown since April 2nd, but U.S. government bonds haven't.

00:55TermPremia went from 35 basis points on April 2nd to 70 basis points. Dollar hasn't recovered fully.

01:01So there is something more exceptional about U.S. equities and U.S. corporates,

01:05and this is what we are focused on in terms of our risk on strategy.