00:00So this week we'll hear from Home Depot, we'll hear from Target, we'll hear from Walmart as well.
00:04You'll hear from those names across Tuesday, Wednesday and Thursday.
00:07Retail sales was really, really soft.
00:09How do you expect these companies to guide around the consumer into your end?
00:12So look, I think the commentary we've been continuing to hear is value-seeking behavior,
00:17you know, sort of the pressures from the low end creeping up to the middle end.
00:21You know, I think largely what we've seen so far from companies has been consistent with this narrative
00:26that we've gotten, you know, kind of over the last few quarters.
00:29But there were some cracks, right?
00:30And if I look at the travel companies, I've been reading those on the team.
00:34We split everything up.
00:35And, you know, what we've seen is maybe some inconsistent discussions in terms of how resilient that consumer is.
00:40So that was one crack we started to notice.
00:42And then we had a big restaurant a couple weeks ago say they had actually seen some slowing.
00:46So, you know, we're going to have to see what we get.
00:48But I would say that the kind of theme of resiliency, I think that's going to be a hard one
00:52to break,
00:52even as companies are acknowledging, you know, maybe some cracks happening.
00:55Do you think we could continue on two slightly different tracks,
00:57where we've got this massive corporate earnings boom on one track
01:00and then this moderating economic macro backdrop on another?
01:03If you look back to 2015, 2016, right, we had the industrial energy recession and the consumer was very strong.
01:09So you kind of had two tracks.
01:11And I would say we're seeing more and more of that over the past, you know, kind of decade or
01:15two,
01:15where things are not necessarily, you know, syncing up across the board.
01:192022 and 2023, 2022, we had a tech earnings recession.
01:23You know, we had weakness in the rest of the market the following year.
01:26So the idea that things can get on different paths isn't that actually unusual for the last decade.
01:31A few weeks ago, people were once again talking about maybe sell America's coming back.
01:35Are you still very committed to the United States?
01:37So, you know, we had seen basically, if you look at U.S., non-U.S., forward PE, like global
01:42developed markets within that context,
01:44back at the beginning of February, U.S., or end of February when the war broke out, U.S. got
01:48cheap.
01:49And so you had kind of a buy the USA trade.
01:51And we've seen that flip back and forth a couple times.
01:53We're basically back to the five-year average.
01:56We don't look expensive in the U.S. yet.
01:58I do think we still have that war resiliency narrative.
02:01I think the AI trade is back in vogue.
02:03And when growth outperforms, you tend to see the U.S. outperform.
02:06So I would say things are not as screaming a buy as they were, say, four to six weeks ago
02:10for the U.S. versus non-U.S.
02:12But I don't see any impediments right now.
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