00:00Europe continues to have huge opportunity.
00:02We feel very strongly about that.
00:04And we actually are optimistic about Europe.
00:06It represents 9 to 10% of the global population.
00:09It's 10, 15% of global GDP.
00:12But it requires Europe to operate in that capacity as Europe,
00:15not as 27 separate member states.
00:18And so what are we focused on?
00:20We're focused on that goal, and it's a simple goal.
00:22We really want Europe to operate in a cohesive fashion.
00:25You know, what you just heard from your prior speaker
00:26around this technology fund,
00:28that's an enormous opportunity.
00:30I think they are leaning into two simple goals,
00:33which is consistent with our philosophy.
00:35Number one, we need to make it easier
00:37for business to operate pan-Europe.
00:39We can't have local jurisdiction, local regulations,
00:43and local admin.
00:43You really believe that?
00:44Because we've been talking about it for a while.
00:46Yeah, we do believe it.
00:47We do believe it.
00:48Look, we think it's going to take some time.
00:49We think you have to be patient.
00:51You think you have to be persistent.
00:52But I think European leaders and regulators
00:54get the need to make Europe an easier place
00:57for people to operate cross-border.
00:58And they also get the importance
01:00of having a deep, unified capital market
01:03so that actually when those corporates,
01:05when those startups scale up to a sensible place,
01:07they can access a proper capital market
01:10that has the depth and liquidity
01:11of both the U.S. and Asia.
01:12Look, there's just a lot going on in markets,
01:16and it's AI.
01:17It could be the AI trade.
01:18How do you see the risks
01:21over the next six months in markets?
01:23It doesn't feel like the Middle East
01:25is getting any better,
01:26but I guess businesses have also a way
01:28to adapt and adjust.
01:29Yes, so global stock indices, of course,
01:31have really been strong,
01:33many of them at now all-time highs.
01:36As you point out, AI has been a dominant theme.
01:38There is very narrow breadth
01:39when you really look at that outperformance.
01:41The U.S. has really led this retracement
01:44post this conflict starting,
01:46but it is quite concentrated.
01:48And you're now starting to see some wobbles since Friday
01:51where the momentum trade is starting to turn,
01:54but it has really been a big structural trend.
01:57The market is, of course,
01:59looking at earnings coming out like NVIDIA, etc.
02:01It's a really path forward.
02:03I'd say what we see from our own business
02:04and our own clients
02:05is real commitment to continue to scale.
02:08Now, some of that is just down
02:09to the insatiable demand for compute
02:11and really this race for capacity.
02:14But I'd also say from a corporate level,
02:16people are really starting to see the benefits
02:18from a productivity lens of this technology.
02:21So we do think that structural trend
02:22is there to continue.
02:24Of course, there'll be bumps along the road.
02:26We can have a debate on AI
02:27on whether the value is going to accrue
02:29with the chip player,
02:30the infrastructure layer,
02:30the mobile layer,
02:31the enterprise layer.
02:33And a lot of that is going to remain
02:34to be seen over the cycle,
02:35but it's clearly a place
02:37that our clients are focused.
02:39Now, of course,
02:39one of the disconnects we get, though,
02:41is the fact that stock indices are at the high,
02:43but the price action in bond markets
02:45is obviously problematic
02:46on a global basis.
02:47Thus far, most of the sell-off
02:49we're seeing in bond markets
02:50is because of the inflationary impact
02:52of the current conflict.
02:53But there's a vicious cycle
02:55where the raising interest rate
02:56starts becoming a fiscal problem,
02:58and that's when things can sour and turn.
03:01I'd also say that right now,
03:02the markets focus on inflation
03:03and those impacts from the war,
03:05less the growth impacts.
03:07Now, that can bite too.
03:08We've survived thus far up to May
03:10because inventories
03:11and commodities were higher.
03:12There's been some substitution,
03:14but at some point,
03:15those stockpiles can run dry.
03:17So if we don't get resolution
03:18when opening up at the straight,
03:20of course,
03:21that can start to have
03:22a real supply-side impact,
03:24and that's when the confluence
03:26of these things
03:26can become more problematic
03:27for markets.
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