00:00Bailey, you lead our IPO coverage. We're going to talk about SpaceX and the fantastic reporting
00:06that you and the team have done around it. Before we do that, though, as we just heard
00:10from Charlie, we're seeing a major sell-off today with some of the chip names really leading
00:14the charge lower. Your view on this equity market, especially as tech has been leading
00:20the way, giving back some of these historic gains. I mean, Tim, I go to Italy for about
00:25two weeks and the market's at an all-time high. We missed you. On no news, though, Tim. No news
00:29happens. The market goes up. No one bats an eye. We see two days of weakness and all of a
00:33sudden
00:33the sky is falling. I just want to call out the fact that, yes, the Philadelphia Semiconductors
00:38Index is down more than 9.5% right now. It's up 74% year to date. If anyone told
00:43you that,
00:44that would be the case sitting here on June 5th. I think they would take that. NASDAQ 100,
00:48of course, down 5% from its all-time high on Tuesday. It does seem like a bit of consternation.
00:53I think the big question when I talk to investors is, what's the next move for the Fed? And it
00:56does
00:57seem increasingly that the logical answer has to be a hike, whether that's later this year,
01:01whether that's early next year. Obviously, we'll see how the economic data play out.
01:05But it does seem like kind of a natural way to take your foot off the gas pedal going into
01:10a
01:10weekend. Obviously, we're still living in breathing everything that comes from the White House. But the
01:16big question at the end of the day is, is this a market that did nothing but go up for
01:19a number of
01:20weeks, if not months, for no real reason and what kind of lies ahead? And obviously, there's going to
01:26be a big IPO next week that'll be interesting to track as well.
01:30You know, having said that, Bailey, I do feel like this is a moment in time where there's just such
01:35a
01:35FOMO trade, especially when it comes to AI and tech and even some of these IPOs, which we're going to
01:40dig
01:40into in just a moment. We talked with John Flood over at Goldman Sachs earlier, you know, and he tracks
01:45hedge funds and institutional investors and did talk about the hedging that these folks are doing
01:51so that they're not all in on everything. Do we see any of that? Do we see a rise in
01:57short
01:57positioning at all? Do we see anything that kind of says, all right, people are enthusiastic, but
02:02they're also playing this smart? I think there is kind of that sense when you look at some of the
02:06data
02:06that we see in others track, it does seem like dips are being bought in the sense that some of
02:11these
02:11memory stocks are being added to. Today, we did see people taking protection over the last few
02:15weeks as it relates to some of those higher flyers. But Carol, it still is an interesting market where
02:20you do see certain short positions rising, but in other pockets of the market, you're still seeing
02:26exuberance or even just shades of exuberance as it relates to what the future could hold. So
02:31we're seeing a lot continuing to play out. The big thing has been this is a market that when I
02:35look
02:35back over a few days ago, even, I expected to see a sharper pullback. And coming into today,
02:41we were down, you know, 80. So I just want to point.
02:44NASDAQ. Sorry. Yeah, no, don't be sorry. It's like a lot coming at us. We're looking at if we
02:50look at the chart, kind of a slope down on all these major equity averages, and we are now
02:54down about four and a half percent or more than four percent on the NASDAQ 100. So we continue to
03:00see
03:01selling into the close here, Tim. Yeah. Bailey, does it change? Does it? I know one day does not
03:06make a market, and especially given the rapid move higher going back to the end of March that
03:12we've seen, especially with tech. As I mentioned earlier this week, the NASDAQ 100 was up more than
03:1730 percent just from March. The Sox was up more than 90 percent earlier this week, still up, as
03:23Carol mentioned, more than 70 percent. Does it change? I'm not going to say does it change the timing,
03:28but does it change the environment that SpaceX goes public in? I think anyone who says that the
03:35NASDAQ 100 down almost five percent in a single day doesn't matter is probably lying to you. But I
03:42do think, listen, this is, I'll give you the summary that I've been giving people. It's been five months
03:48ago we and others reported that SpaceX wanted to raise $75 billion at a 1.75 to 1.8, maybe
03:55$2 trillion
03:56valuation. That was five months ago. Here we are in June and it's happening. They set a fixed price
04:01a few days ago for this IPO. If there ever was a deal that has been as transparent or the
04:08worst kept
04:08secret, it's this one. So anyone who's now all of a sudden saying, you know, the NASDAQ 100 is down
04:13four and a half percent. I actually can't cut the check to SpaceX that I thought I could a week
04:17ago.
04:18Well, where were you when the stock was, the market was in a bit more turmoil? And I think that's
04:23just
04:23one thing that I think people have to keep in mind that we've been talking about this for months. This
04:27isn't a deal that came out of left field. It's not a deal that started with a price range that
04:32was
04:32north of $2 trillion and they have to sell investors on that notion. This is something that bankers in
04:37the company have been, at least through our reporting and others, it's been pretty open and very clear
04:42about. The demand that we're already seeing right now for this IPO next week, how would you
04:49characterize it? It's expected. I mean, 75 billion. So nothing off the charts, nothing surprising?
04:55No, I think this is, again, we know that the company did one-on-one meetings at Starbase with
05:00some of the biggest portfolio managers in the world back in January. Does it need to do that?
05:04Everybody sees what the rockets do. Everybody knows who Elon Musk is. Tim, I'm going to direct you to
05:10some of our reporting and say that this is a company that a year ago was a space monopoly. And
05:16now
05:17they're pitching a $26.5 trillion AI market. This is a company that when you look at the sell side
05:23models that we were able to get our hands on, analysts are penciling in AI to bring in $755
05:30billion in sales in 2031, according to Evercore ISI research analysts. That was $3.2 billion last
05:36year. So there's a lot of excitement. There's a lot of hopium. But this is a company that before the
05:41XAI merger was strictly a space company. And now we're seeing the magic of Elon Musk,
05:46or at least people being excited about what AI could bring and what orbital data centers could
05:51bring. And I tuned into that conversation Musk had with Jamie Dimon yesterday talking about making
05:56Star Trek reality. Yes, this is all Elon Musk, but this is something we saw play out with Tesla.
06:01And we're going to see it play out with SpaceX. Well, as people reminded us at the Bloomberg
06:05Technology Summit yesterday, Bailey, never count Elon out. Just about 30 seconds. I think it's
06:11going to be... Yeah, that was Trey Stevens at Anderil with his conversation with Ed Ludlow. He said,
06:14don't bet against Elon. Exactly. What will be key, though, is how this stock, once it IPOs,
06:19trades in the months right after. Just quickly. Yeah, it'll be critical. And I think even day one
06:24will be closely watched. If 30% of this does get allocated to retail north of $20 billion,
06:29we've never seen that. So it's going to be key for markets and for the company, hands down.
06:34Gotta say, it is a fun time to be covering markets, right? Yeah, don't go back to Italy next
06:38week. Yeah. I came back and all of a sudden everything was still going crazy.
06:44Yeah, I agree that you can kind of disappear, come back, and crazy still exists.
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