>> THIS IS BLOOMBERG TECHNOLOGY.
>> LIVE FROM SAN FRANCISCO. THIS IS BLOOMBERG TECHNOLOGY.
THE GLOBAL EQUITY ROUTE INTENSIFIES.
FROM NVIDIA TO ROBIN HOOD AND MICROSOFT, THE NAMES HIT
HARDEST. HE WILL HAVE FULL COVERAGE ON APPLE, AS BERKSHIRE
SLASHES ITS STAKE. IT IS AN UGLY DAY, BUT WE ARE
OFF SESSION LOWS. START BECOME ASIA, TO THE EUROPEAN, AND NOW
THE UNITED STATES. LOOKING AT THE S&P 500, 3%
DECLINE. ON THE TRACK FOR THE BIGGEST
DROP SINCE SEPTEMBER. THE CHIP STOCKS FEELING I
TAOPBGS SITE. YOU SAW THE TWO-YEAR TREASURE
BELOW THE 10-YEAR FOR THE FIRST TIME SENSE 2022.
THE CRYPTO MARKETS ARE INTERESTING.
SHOW ME BITCOIN AND LOOK AT THE

SEVERITY OF DECLINES.
WE ARE IN AN ASSET CLASS TRADING 24-7. IF WAC BRING THAT
UP, THERE’S IS TECHNIQUE ANXIETY IN
THE SINGLE NAMES. YOU LOOK AT BITCOIN DOWN 8.8%,
24-7 TRADING. APPLE AND NVIDIA OFF SOME
THINGS LOWS BUT FAMOUS LEADING DECLINES FROM A MONTH
PERSPECTIVE OR PERCENTAGE CHANGE DRIVE.
WE HAVE OUR REPORTERS HERE. I THINK THIS DATA ON FRIDAY
STARTED THEN THE NEWS THROUGH THE WEEKEND AND HERE WE ARE
THROUGH THE ASIA, EUROPEAN AND U.S. SESSION. >> STARTING FRIDAY WE HAD WE
CAN JOBS DATA SO IT FEELS UNDER PRESSURE BUT OVER THE WEEKEND I
WAS TRYING TO FIGURE OUT WHAT WAS GOING WRONG AND WE HAVE NEW
YORK TO LONDON AND KNOCK YO S&P

500 FOR THE WORST SINCE 2022.
WITH 95% IN THE RED. I READ A NOTE. IT IS BETTER TO
ASK, WHAT DIDN’T GO WRONG. WE HAVE A RATE HIKE FROM JAPAN,
PERCEIVED FAILURE BY THE FED TO COT RATES.
WARREN BUFFET SELLING APPLE AND BLOOMBERG STORYTELLING TRADERS.
MAYBE IT IS A CAUSE FOR PANIC, BUT SOME PANICKING. BUT LAST
UNWIPEDING OF THE HIGHLY POPULAR YEN, WHERE WE ARE SEEING
PRESSURE THERE, WHERE YOU BORROW. I DON’T KNOW TO INVEST IN THE
HIGH FLIES REASONS, BUT IT IS A SLEW OF REASONS. >> MIKE MCKEE OR POLICY AND
ECONOMICS CORRESPONDENT. THE MARKET EXPECTATION FOR THE FED
ARE A BIG PART OF THIS. THE MARKET PRICING IN 60% CHANCE OF
EMERGENCY RATE CUT THIS WEEK.

EXPLAIN THAT TO ME. I CAN’T REALLY EXPLAIN IT,
EXCEPT FOR PANIC. IT WAS IN ASIAN MARKETS WHERE
THE VOLUME IS LOWER, AND PEOPLE DON’T UNDERSTAND THE FED
PERHAPS AS WELL. IT IS REALLY COME BACK AT THE
MOMENT. ONE WEEK SWAPS ARE PRICING IN A FIVE BASIS POINT
MOVE, NOT EVEN A REAL RATE CUT. SO AT THIS POINT, YOU CAN’T
REALLY SAY PEOPLE THINK THE FED IS GOING TO BE GETTING INVOLVED.
IT IS MORE WISH BEING THE FATHER, IT THE MAN IN THE
MARKETS ALWAYS LOOKING TO THE FED WHEN SOMETHING GOES WRONG, BUT
THERE’S SOME RIGHT WITH WHAT HAS HAPPENED FROM AN ECONOMIC
STANDPOINT IN THE SENSE OF I.S.M.
SERVICES NUMBER. GOOD AND YIELDS FALLING. WE ARE SEEING MORTGAGE
RATES FALLING AND SEEING

GASOLINE PRICES FALLING, AND THOSE THINGS COULD BE STIMULATING THE ECONOMY. SO THE FED WILL SAY, YOU ARE LOSING MONEY IN THE EQUITY TRADE BECAUSE MAYBE YOU DID THE WRONG TRADE, BUT IT IS NOT SOMETHING WELCOME FIX. YOU GAVE THIS GLOBAL PICTURE OF WHAT HAPPENED IN EQUITIES MARKETS. ONE QUESTION I HAVE BEEN GETTING IS BITCOIN. THOSE SAYING YOU KEPT TELLING US IT WITH BEHAVE LIKE A HAVEN ASSET IN AN AOEURPLT LIKE THIS. IT SEEMS TIED TO THE FED NARRATIVE. THAT IS THE THING; IT HAS BEEN MORE OF A BAROMETER OF RISK, AND WE SEE THOSE EDGING HER. WHAT IS INTERESTING IS THE E.T.A. AND ETHEY ARE E.T.S.

BALLS. WE’VE NEVER SEE THIS ECONOMIC CLIMATE WITH THIS PROSECUTED. SOME COMPARE IT TO THE GREAT FINANCIAL CRISIS. WHERE WE ARE GOING TO KEEP TRACK OF THE STORY FROM ACROSS THE ASSET TEAMS. AND NOW WE SEE THEY ARE UNDER SOME PAIN. SO IT WILL BE INTERESTING TO SEE HOW BITCOIN AND ETHEY ARE E.T.S. IN THIS FORTUNATE OR UNFORTUNATE SITUATION. WE SAY WITH TECHNOLOGY THE HIGHER RATE TEMPERATURE. THE TECHNOLOGY INVESTORS TRACK WHAT THE FED WILL DO. I WAS LISTENING IT BLOOMBERG SURVEILLANCE AND THEY WERE TALKING ABOUT THE DISTINCTION BETWEEN THE FED LESSER FOCUS ON RESTRICTIVE POLICY. WHAT HAPPENS NEXT? I KNOW THAT IS IMPOSSIBLE TO ANSWER BUT GO AHEAD.

>> THAT IS SORT OF AN IMPOSSIBLE SET-UP BECAUSE THE FED WILL NOT WANT TO DO ANYTHING EMERGENCY AND REACT IT STOCK MARKET UP-AND-DOWNS. THE DATA HAVE TO SHOW THE FED THAT THERE IS A SIGNIFICANT SHIFT IN THE CHECK OUTLOOK BEFORE THEY WOULD CONSIDER A 50 BASIS POINT CUT OR MOVING MORE CLOSER TO ACCOMMODATIVE. THEY ARE ON TRACK FOR 25 IN SEPTEMBER BECAUSE AT THE FEEL LIKE THEY NEED TO NORMALIZE AND GET BACK TO A CLOSER THAN NEUTRAL RATE. I DON’T THINK THAT WILL CHANGE IN THEIR MINDS UNLESS WE SEE DATA COMING IN BADLY AND THE FIRST DATA THIS I. THE M.S. WERE BETTER THAN EXPECTED ACROSS THE BOARD SO THE CAUTION WILL BE DEPENDENT ON THE DATA AND THE DATA AT THIS POINT ARE

NOT TELLING THEM THEY NEED TO DO ANYTHING. >> LET’S GET MORE ON THE MARKETS WITH THE SENIOR STRATEGIST AT EDWARD JONES. I’M ALWAYS ONE FOR A DATA POINT AND THINKING OF THE MAX 7. ED A ONE POINT IT FEELS THE BIG EX-DROP ON RECORD. >> WE SAW THE MARKETS WERE LED BY THE MAGNIFICENT SEVEN AND IT HAS BEEN THE MAGNIFICENT SEVEN IN THE WEEK SPOT. I THINK THAT IS THE COMPANIES AT THIS POINT TO DELIVER OUTSIZED EARNINGS GROWTH. THE BAR FEELS VERY HIGH. AS A RESULT, WE DID SEE SOME DISAPPOINTMENTS. THESE WERE TRADING AT THE HIGHEST P/E RATIOS SO WE ARE TALKING ABOUT INVESTING IN OTHER ASSETS AND WITH THE YEN THEY ARE SELLING SOME OF THOSE ASSETS AND NO

DOUBT SOME OF THEM ARE THE MAGNIFICENT SEVEN STOCKS. SO WE’VE THE HIGH PAR, EARNINGS BROADENING TO OTHER SECTORS. FOR INSTANCE, WE HAVE SEEN THE BIGGEST EARNING SURPRISES FROM DEFENSIVE CENTERS AND NOT THE GROWTH SECTORS WE WERE USED TO THE LAST COUPLE OF EARNING SEASONS. >> LET ME JUMP IN. THE FUNDAMENTALS HAVE NOT CHANGED IS WITH YOU SAID. WE MADE A BIG DELVE THE GAIN IN THE S&P 500 THE FIRST HALF OF THE YEAR, 14% OR SO LARGELY FROM MAGNIFICENT SEVEN. IN YEARS WHERE THE S&P 500 GAINED DOUBLE DIGITS IN WONE AGE, IT USUALLY GOES ON IN TWO AGE. HOW MUCH OF A DEPARTURE IS THIS FROM THAT HISTORIC TRENDS? >> I THINK THERE’S GOOD THINGS GOING ON.

ONE IS THE TECHNICAL PICTURE,
WHICH IT IS AN OVERREACTION THAT POTENTIALLY MOVING HER.
PRESENTS AN OPPORTUNITY FOR THE REMAINDER OF THE YEAR. THEN THE
SECOND PART IS, IS THERE SOMETHING FUNDAMENTALLY BROKEN?
ARE WE HEADING TOWARDS A RECESSION BECAUSE A LOT OF THAT
NARRATIVE HAS BEEN AROUND THE GR GROWTH.
IT IS SLIGHTLY BELOW LOOKING AT THE G.D.P.
IS SLIGHTLY NORTH OF 2%. WE GOT THE I.S.M. SERVICES. THAT WAS WELL INTO EXPANSIVE,
AND EMPLOYMENT COMPONENT SOME REASON FOR OPTIMISM.
EVEN FRIDAY THE JOBS REPORT WE GOT. SO WE DO NOT THINK THAT THE
U.S. ECONOMY IN A WEEK’S TIME IS GOING TO FALL OFF.
WE HAVE TO STAY STILL, RISING WITH PROFITS, CONSUMERS, AND I
THINK IT FITS INTO THE

NARRATIVE OF BROADENING MARKET, AWAY FROM THE OVERALL POTENTIALLY OVEREXTENDED TECH. SO WE STAY POSITIVE FOR THE REMAINDER OF THE YEAR, BUT DON’T THINK THE MAGNIFICENT SEVEN WILL BE ONCE AGAIN THE ONES EVERYONE GRAPH STATES TOWARDS. WHAT YOU JUST OUTLINED IS NVIDIA. IT IS DOWN NOW AND AT ONE UPON THE 15%, WHICH FOR A COMPANY THAT SIZE IS A BIG DROP. THERE WAS A REPORT SAID BLOCKWELL, THE NEXT GENERATION AI ACCELERATOR FACED ISSUES WITH DESIGN. THEY GOT BACK TO US AND SAID IT IS STRONG, BLOCK WPL IS STARTING. YOU JUST SAID WE MOVE FROM THE CONS IT’S OF LEADERSHIP, BUT WE’VE IT WAIT UNTIL THE 28TH OF THIS MONTH TO GET NVIDIA EARNINGS.

THAT IS QUITE A LONG PERIOD OF TIME. WHERE THE MARKETS COULD HAVE ANXIETY. BUT FROM WITH HAS BEEN A LEADER. WHAT DO YOU MAKE OF THAT? >> NVIDIA IS THE LAST OF THE MAGNIFICENT SEVEN. IT REPORT EARNINGS. THE THING SO FAR EVERYBODY IS EXCITED ABOUT. THE SKEPTICISM THE LAST COUPLE WEEKS. INVESTORS ARE GETTING INCREASINGLY IMPATIENT. IT SEE THE SPENDING TRANSLATE INTO PROFITS. WHAT WE HAVE BEEN HEARING FROM. THE REMAINDER OF THE MAGNIFICENT SIX OF THE SEVEN IS. THEY HAVE BEEN EXPANDING. SO THAT HAS CONTINUED TO BE A WIN FOR ENVIEDIA. I THINK WHAT WE’RE TALKING WITH. HERE IS THE HIGH BAR OF EXPECTATION. WE YOU HAVE A STOCK. NOT SO MUCH THE LAST COUPLE YEARS AND THE RECENT PULL BACK. NATURALLY THAT

CREATES TENSION POINTS WHENEVER
THE NEWS. LIKE WE HAVE BEEN GETTING THE LAST COUPLE WEEKS,
BUT WE CONTINUE TO BE POSITIVE. NOT ONLY FOR THIS YEAR BUT THE
NEXT FIVE TO 10 YEARS. THAT IS IMPORTANT. >> THANK YOU.
WE SAID THAT THIS ALL STARTED IN THE ASIAN SESSION.
IT FEELS THE WORST DAY IN 57 YEARS AFTER SHARES PLUNGED 9.8%,
A RECORD DAILY DECLINE. MORE THAN 0% OF IT, WHICH CLOSED
DOWN 8.4%. JAPAN AND SOUTH KOREA ALSO FELL
SIGNIFICANTLY IN THEIR MONDAY SESSIONS.
COMING UP, WE WILL HONE IN ON APPLE.
SAYERS PLUNGE AND BERKSHIRE SLASHES ITS STAKE IN THE IPHONE
MAKER. OFF SESSION LOWS, A SIGNIFICANT
DECLINE. THIS IS BLOOMBERG TECHNOLOGY. >> LET’S LOOK AS SHARES OF
ANLE OFF SESSION LOWS BUT ONE

POINT DOWN MORE THAN 10%, WHICH WAS A WORRYING WAY TO START THE U.S. SESSION ON A MONDAY. LET’S BRING IN MARK. ONE OF THE NEWS FLOW ITEMS WAS BERKSHIRE HEART WAY SLASHING ITS STAKE IN ANLE TO GENERATE CASH, BUT THEY HAVE BEEN URGED TO KEEP CALM IN SPITE OF WHAT HAPPENED. ELSEWHERE CONCERNED ABOUT GROWTH. THE APPLE SIDE OF THIS STORY, PLEASE. >> WHEN YOU HAVE DECLINES OF THAT MAGNITUDE YOU MENTIONED 10% IN THE EARLY HOURS OF TRADING NOW DOWN TO 3%. THESE ARE MORE MACRO RELATED ISSUES WITH THOSE BIG SWINGS IN VOLUNTEERS. THERE’S NOTHING APPLE NECESSARILY DID, NO NEWS ITEM RELATED TO APPLE’S ACTIONS OF PRODUCT. A LOT OF IT HAS TO DO WITH MACRO CONCERNS, THE SITUATION

IN THE MIDDLE EAST, EN ISN’T
SURROUNDING THE ELECTION. PEOPLE WANTING TO HOLD ON TO
CASH. BUT AS YOU MENTIONED, THE WARREN BUFFET BAKER SHIRE NEWS
OVER THE WEEKEND. COMPARED TO THE BEGINNING OF
2024, BUFF FIT’S STAKE IN ANLE IS HALF WHAT IT WAS.
HE STILL HAS ABOUT AN 84.2 BILLION STAKE, SO A HUGE STAKE
REMAINING IN APPLE. BUT WHEN YOU GET HEADLINES
ABOUT WARREN BUFFET SELLING THAT MUCH APPLE OVER THE LAST
SECTION TO EIGHT MONTHS, COULD BE CONCERNING. COMBINED WITH
SOME OTHER CONCERNS, GREATER CHINA, ART TPERBLG INTELLIGENCE
GROWTH. IPHONE MOVING FORWARD. ALL OF THAT IN ADDITION TO THE
MICRO FACTORS. IT IS RETPHBGTED SOME OF THE
RUN-UP HAS BEEN ABOUT FAITH.

THAT APPLE INTELLIGENCE WOULD DELIVER. YOU WROTE OVER THE WEEKEND AFTER THAT WITH APPLE INTELLIGENCE THERE’S A LONG WAY TO GO. WHAT WERE YOUR ARGUMENTS? APPLE INTELLIGENCE IS GOING TO BE A BIG ISSUE FOR ANLE MOVING FORWARD. THEIR MARKETING IS HEAVILY ON THE CALL. I DIDN’T GET AN OFFICIAL COUNT, BUT AT LEAST MENTIONED 15 TO 20 TIMES THEY HAVE BEEN ASKED ABOUT IT. BUT I DON’T THINK THE INITIAL FEATURE SET IS SOMETHING THAT WILL DRIVE IPHONE UPGRADES FOR THIS CYCLE. IT WILL PROBABLY DRIVE UPGRADES IN FUTURE CYCLES. I DON’T THINK THERE’S A CONNECTION BETWEEN REALIZATION OF WHAT THE PERFORMANCE OF ARTIFICIAL INTELLIGENCE AND THIS DECLINE. IF YOU LOOK AT THE REST OF THE MARKET, THEY ARE IN DECLINE AS

WELL, SO IT IS LARGELY MORE MACRO FACTORS THAN ANYTHING VERY SPECIFIC. >> THANK YOU. LET’S CHECK IN ON TODAY’S TRADING OVERNIGHT. IT STARTED IN ASIA. A BIG PART IS INDEX LEVEL DROPS IN EXCESS OF 12 PERCENT BIGS SINCE 1987. ONE NAME THAT HAD A BIG CONTRIBUTING FACTOR IS SOFT BANK DROPPING THE MOST SINCE 1998 DOWN 18 BY 7%. THAT IS A SIGNIFICANT DECLINE. WE WILL KEEP TRACKING THESE MARKET MOVES. THIS IS BLOOMBERG TECHNOLOGY. >> TIME TO TALK TECH. TIKTOK HAS BEEN SUED BY THE U.S. GOVERNMENT FOR ALLEGEDLY COLLECTING DATA ON CHILDREN. IN A SUIT FILED FRIDAY, THE JUSTICE DEPARTMENT CLAIMS IT HAS ALLOWED MILLIONS OF KIDS

UNDERSTOOD 13 TO CREATE
ACCOUNTS WITHOUT THEIR PARENTS’ KNOWLEDGE OR CONSENT, IN
VIOLATION OF AN ONLINE PRIVACY ACT. TIKTOK PREVIOUSLY REACHED A
SETTLEMENT IN 2019 WITH THE F.T.C.
ON CONCERNS RELATED TO CHILD PRIVACY.
PLUS, ONLINE TRADING PLATFORMS FROM ROBINHOOD TO FIDELITY AND
CHARLES SCHWAB HAVE BEEN SUFFERING OUTAGES IN A SURGE OF
VOLUME. MORE THAN 14,000 USERS REPORTED
AN OUTAGE AT SCHWAB AT 9:50 A.M. IN NEW YORK, ACCORDING TO DOWN
DETECTOR. THE FIRM DIDN’T IMMEDIATELY
RESPOND TO REQUESTS FOR COMMENT, BUT A COMMENT SAID THAT SOME
CLIENTS MIGHT HAVE DIFFICULTY LOGGING TO SCHWAB PLATFORMS. THE
UPCOMING CHIPS WILL BE

DELAYED THREE MONTHS OR MORE DUE TO A DESIGN FLAW. AN NVIDIA PERSON SAID THE DEMAND IS STRONG. PRODUCTION IS ON TRACK TO RAMP IN 2H. BEYOND THAT, WE DON’T COMMENT ON RUMORS. THEIR EVALUATION IS NOW $2.8 BILLION. IT FOCUSES ON BUILDING GOES A.I. INFERENCE TECHNOLOGY. WE BRING IN THE C.E.O. WE WERE SPEAKING LAST WEEK ABOUT THE MOVE FROM TRAINING TO INFLUENZA. IT IS A SIZABLE CHUNK OF CHANGE YOU RAISED. WITH WILL YOU USE THE CASH FOR? THE FIRST THING IS WE WILL BUILD OUT ABOUT 108,000 OF LANGUAGE PROCESSING UNITS. TO PUT THAT IN PERSPECTIVE, YOU MENTIONED HOPPER LAST YEAR THEY SHIPPED ABOUT 500,000. SO THIS IS ABOUT 20% OF WHAT THEY SHIPPED LAST YEAR.

WE INTEND TO HIRE
SIGNIFICANTLY. BUILDING OUT A LOT OF FEATURES
AND OFFERING A SERVICE WHERE PEOPLE CAN USE THE HARDWARE
WITHOUT HAVING TO BUY IT. THEN WE’RE LOOKING AT SOME
ACQUISITIONS GOING FORWARD AS WELL. >> STRATEGICALLY, WHEN DID GROQ
SAY INFERENCE NEEDS TO BE OUR FOCUS AND HOW IS IT HELPING YOU
GET AHEAD. THERE’S BEEN LOTS OF DISCUSSIONS ABOUT START-UPS AND
COMPANIES WORKING ON TRAINING MANY LANGUAGE MODELS TO SMALLER
MODELS. YOU HAVE A MORE NARROW FOCUS. >> WE HAVE FOCUSED ON INFERENCE
FROM THE BEGINNING. THE REASON IS TRAINING AT THIS
POINT IS A WELL-SOLVED PROBLEM AND WE KNEW IT WOULD BE.
MY BACKGROUND, I STARTED AT GOOGLE TPU CHIP.
WE STARTED WITH INFERENCE

BECAUSE WE COULD TRAIN THEM, BUT COULDN’T PUT THEM IN PRODUCTION. WITH YOU SPEND ON TRAINING, YOU WILL CONTINUE, BUT YOU WILL SPEND 10 TO 20 TIMES PUTTING IT IN PRODUCTION. YOU MAKE YOUR MONEY WITH
INFORENSIC STANDS. IS A SCALE GAME. IS WE’VE BEEN FOCUSED ON THIS SENSE DAY ONE. >> THERE’S SORT OF A RELATIONSHIP IN TALENT CONVERSATION TO BE HAD. ONE IS GOING TO BE YOUR NEW TELL ADVISOR. WHY IS THAT IMPORTANT TO YOU? >> IT IS A LEGENDARY PERSON IN THE INDUSTRY WINNING THE WEIRD FOR ONE OF THE THREE ALGORITHMS THAT MAKE IT WORK AND VERY CEN CENTRALLY POSITIONED IN TERMS OF AI AND PUSHING HEAVILY FOR OPEN SOURCE MODELS, AND THIS IS SOMETHING IMPORTANT FOR THE

INDUSTRY.
GROQ WOULDN'T EXIST TODAY IF NOT FOR ONE SOURCE.
WE BUILT THE BEST CHIPS, BUT IF WE DIDN’T HAVE THE SOFTWARE, WE
WOULD NOT BE ABLE TO DEMONSTRATE THAT.
SO THE MODELS ARE THE LEFT-HAND KNOCKS OF THE GENERATIVE AGE,
ENABLING PEOPLE TO GET INTO THE AI BUSINESS WITHOUT
NEEDING TO TRAIN THE MODELS THEMSELVES. THE C.E.O. OF G.R.O.Q.
WE HAVE TO GET BACK TO PUBLIC MARKETS. WE ARE OFF SESSION LISTS.
THERE ARE STILL SIGNIFICANT AND SEVERE DECLINES AT THE INDEX
LEVEL. WE TALKED ABOUT APPLE, NVIDIA,
S&P 500 UP 2.3%, NASDAQ SIMILAR.
SEMICONDUCTORS ARE A PLACE WHERE THIS PARTICULAR ANXIETY
IS, AND WE TALKED ABOUT THE TFMC’S AND ALSO FEELING THE
PAIN.

A PART IS ECONOMIC DATA AND PART GROWTH, AND MAYBE THE FED DOES SOMETHING SOONER THAN SEPTEMBER. ALL THEY THE SWAPS MARKET HAS PARED BHAKTA BET. THIS IS BLOOMBERG TECHNOLOGY. ED: WELCOME BACK TO BLOOMBERG TECHNOLOGY. I WILL GO STRAIGHT TO THE NASDAQ 100. WE ARE ALL SESSION LOWS, DOWN 2.3% OR SO IN THE SESSION, BUT WE REMIND OURSELVES ABOUT SOMETHING WE TALKED ABOUT ON FRIDAY. THE NASDAQ 100 CLOSED FRIDAY WITH 4 STRAIGHT WEEKS OF DECLINES. SO WHAT IS HAPPENING RIGHT NOW IN THE MOMENT, THERE IS ANXIETY IN GLOBAL FINANCIAL MARKETS, BUT IT HAS KINDA BEEN HAPPENING OVER A LONGER PERIOD OF TIME IN TERMS OF THE DOWNWARD PRESSURE.

ON TECHNOLOGY STOCKS IN PARTICULAR. IN TERMS OF SINGLE NAMES, SPECIFIC ASSET CLASSES, NVIDIA IS UNDER PRESSURE BUT OFF OF SESSION LOWS. APPLE IS ACTUALLY NOW DOWN 4% AND ITS DECLINES ARE STARTING TO ACCELERATE BUT NOWHERE NEAR THE 11% DROP AT THE OPEN. BITCOIN, $54,000 U.S. PER TOKEN, BUT DOWN 8% IN THE CURRENT U.S. SESSION. THERE IS A LOT TO DISCUSS. DELIGHTED TO BRING IN SONALI BASAK. I THINK YOU PROBABLY DISCUSSED ALL MANNER OF THINGS, THE BASICS BEING A MOVE INTO THE BOND MARKETS, THE SAFETY OF THEM, BITCOIN NOT BEHAVING LIKE A HAVEN ASSET, AND EQUITY INVESTORS ARE EITHER VERY WORRIED OR COMPLETELY SANGUINE.

REFLECT ON SOME OF THE CONVERSATIONS YOU HAVE HAD. SONALI: A FEW THINGS. TO YOUR POINT YOU MADE, LOOKING AT THE THIRD DAY OF DECLINES IN THE S&P 500, AND IN THE NASDAQ 100, IT IS THE THIRD DAY OF DECLINES OF MORE THAN 2%. FRIDAY, YOU SAW THE NASDAQ 100 FLIRT WITH THE CORRECTION TERRITORY. OVER THE WEEKEND INTO TODAY, YOU SAW THE ASIAN TRADE JUST REALLY, REALLY SELL THROUGH THE GROUND HERE. YOU SAW HISTORIC MOVES IN JAPANESE EQUITIES, FOR EXAMPLE. AND WHAT YOU SAW WAS AN UNWINDING OF A GLOBAL CARRY TRADE. THIS IS WHAT INVESTORS ARE BORROWING UNDER CHEAP CURRENCY AND REALLY PLOWING THOSE ASSETS NOW INTO HIGHER-YIELDING AND U.S. ASSETS, PARTICULARLY STOCKS IN

THIS INSTANCE, WHICH IS WHY YOU
ARE SEEING THE UNWINDING NOW. THE QUESTION IS, HOW FAR DOES
THE UNWIND REALLY GO? ON TOP OF THAT, THERE ARE VERY
FEW PLACES TO HIDE. TO YOUR POINT, BITCOIN FLIRTING
WITH $55,000, HAD FALLEN BELOW $50,000.
USE OUR GOLD DROPPING THIS MORNING AND OIL DROPPING. YOU
SAW GOLD -- YOU SAW GOLD DROPPING THIS MORNING AND OIL
DROPPING AS WELL. THE ISM DATA GIVE A LITTLE BIT
OF A SIGH OF RELIEF. THE SEVERE BID IN THE BOND
MARKET STARTING TO TAKE ITS FOOT OFF OF THE PEDAL HERE.
STOCKS TAKING IN THE EVENT OF A BREATHER ALONG WITH IT.
STILL DOWN ON THE DAY BUT NOT AS SEVERELY AS WE STARTED THE
DAY LOWER.

THOSE SMALL CAP EQUITIES ALSO
TAKING A MAJOR HIT TODAY AS WELL. REMEMBER, RECENTLY, A LOT OF
TRADERS PLOWING INTO THAT RUSSELL 2000 ROTATION, REALLY
FEELING THE PAIN COMES UNDERNEATH THE SURFACE, A LOT
OF PAIN. I WILL ALSO SEE IT TAKES A
COUPLE DAYS TO SEE THOSE MARGIN CALLS ALSO START TO COME
THROUGH. BIG QUESTION HERE ABOUT WHETHER
THERE IS MORE PAIN WHEN YOU SEE THOSE CALLS START TO COME
THROUGH THE MARKET. ED: STARTING MONDAY WITH A
DISCUSSION ABOUT MARGIN CALLS. HAPPY MONDAY TO YOU. THANK YOU.
LET'S GET THE INVESTOR'S PERSPECTIVE.
NANCY IS HERE TO TALK MARKETS. WITH RESPECT, YOU HAVE BEEN IN
AND AROUND THE MARKETS A LOT

LONGER THAN I, BUT I JUST WANT
TO GO BACK TO THE POINT I MADE. THAT THE NASDAQ 100 HAD FOUR
STREET WEEKS OF DECLINES. BITCOIN TRADED LOWER THROUGH
THE WEEKEND OVER MULTIPLE DAYS. WHEN YOU WAKE UP TO A DAY LIKE
TODAY, IS IT ANXIETY OR IS IT WE SHOULD HAVE SEEN IT COMING A
LITTLE BIT? >> YES, THANKS FOR HAVING ME.
I THINK WE KIND OF DID SEE IT AS EARNINGS STARTED.
THE PENALTY THAT ALPHABET RECEIVED FOR CAPEX SPENDING, AND
SOMEWHAT WEAKER MARGINS IN THE NEXT QUARTER, SEEM OUTSIZED TO
ME. IT IS OFTEN WHAT HAPPENS WHEN
VALUATIONS GET A LITTLE BIT LOFTY.
AND THEN EVERY BIT OF NEWS, EVERY BIT OF HEADLINE NEWS
DRIVES THE MARKET BECAUSE

ALGORITHMS ARE READING THE HEADLINES. THE HEDGE FUNDS ARE TRADING OFF THE HEADLINES, SO YOU GET THESE BIG OUTSIZED MOVES. IF YOU PUT IT IN THE PERSPECTIVE OF THE 40 PLUS YEARS I HAVE BEEN DOING IT HISTORICALLY, THIS HAS BEEN A TIME. I HAVE BEEN DOING IT HISTORICALLY. THIS IS A TIME WHERE YOU WANT TO BUILD A LIST OF NAMES YOU OWN. AND AS THE MARKETS SETTLE IN, VIX COMES DOWN A LITTLE BIT, THIS IS AN OPPORTUNITY. THE LAST THING I WILL SAY ABOUT THIS IS THE ONE ECONOMIC NUMBER THAT HAS BEEN LITTLE DISCUSSED AND GONE UNNOTICED WAS THE IMPROVEMENT IN PRODUCTIVITY IN Q2. CAME IN MUCH HARDER THAN EXPECTED, UP 2.3%. THE PREVIOUS QUARTER WAS REVISED UP ALSO.

AND I THINK PRODUCTIVITY IS GOING TO BE THE KEY, THE MAGIC BULLET, WHATEVER YOU WANT TO CALL IT FOR ECONOMIC GROWTH IN A LOWER INFLATIONARY ENVIRONMENT. ED: TAKE WHAT YOU JUST SAID ABOUT PRODUCTIVITY AND I WILL POST THE QUESTION. WHAT SHOULD THE MARKET DO ABOUT THAT? MIKE MCKEE WAS ON THE SHOW EARLIER TRYING TO EXPLAIN WHY THE SPORTS MARKET WITH THE FED DOING AN EMERGENCY RATE CUT THIS WEEK AND THAT SEEMS MORE TIED TO THE EQUITY MARKET RATHER THAN WARDING OFF A RECESSION OR NOT. I AM TRYING TO TIE MACRO AND MONETARY POLICY WITH THE MARKET'S BEHAVIOR RIGHT NOW. NANCY: YEAH. YOU CERTAINLY KNOW ABOUT THE BOND VIGILANTES, BUT THIS IS WHAT IT FEELS LIKE TO ME.

THE MARKET HAVING A TEMPER TANTRUM BECAUSE THEY THINK THE FED HAS WAITED TOO LONG. THEY PROBABLY HAVE WAITED TOO LONG. THEY HAVE BEEN BEHIND THE CURVE SO THE SPEAK ALL THE WAY THROUGH THIS PROCESS. THIS NOTION OF BEING DATA DEPENDENT IN A WORLD WHERE YOU NEED TO BE LOOKING FORWARD AND WHERE THERE ARE 4 HUNDRED PLACE PHD ECONOMISTS -- 400 PLUS PHD ECONOMISTS FORECASTING MODELS. THEY HAVE MADE IN MY ESTIMATION AN ENORMOUS POLICY ERROR. THAT SAID, STOCKS ULTIMATELY SHOULD TRADE OFF OF HER EARNINGS. I THINK WE GET A CUT BUT NOT AN EMERGENCY CUT AS THE MARKET WOULD LIKE. I THINK THAT WOULD BE BAD BECAUSE WHEN YOU LOOK AT THE ECONOMIC NUMBERS, THE ECONOMY IS JUST FINE.

THE JOBS NUMBERS ARE REVISED DRAMATICALLY EVERY MONTH. SO, I THINK YOU HAVE TO STEP AWAY FROM THAT AND SAY, WAS THAT AN ABERRATION ON FRIDAY? WE KNOW THAT CAP MARKET IS SOFTENING, BUT IS IT COLLAPSING? I DON'T THINK SO. THIS IS AN OPPORTUNITY FOR LONG-TERM INVESTORS ONCE THE DUST SETTLES BECAUSE THEY WILL PROBABLY BE A FEW MORE RUNS TO THE DOWNSIDE, AND THEN I THINK YOU STEP INTO HIGH-QUALITY NAMES. ED: NVIDIA REPORTS ITS EARNINGS AFTERMARKET ON AUGUST 28. HOW UNCOMFORTABLE ARE THE NEXT THREE WEEKS GOING TO BE? NANCY: I THINK THEY ARE GOING TO BE UNCOMFORTABLE. AND REMEMBER, WE HAVE SEEN THIS EVERY YEAR, 2022, 2023. WE WERE TOLD IN THE SUMMER SOON

THE TECH TRADE WAS OVER. BUT REMEMBER, THE SPAN. THAT ALPHABET -- THE CAPEX SPEND. THAT ALPHABET HAS BEEN PUNISHED FOR. IT IS SOMEONE ELSE'S REVENUE. WE HEARD FROM LISA. THAT IS A NAME WE HAVE BEEN ADDING. I THINK IT IS GOING TO BE A CATALYST FOR SOME OUTPERFORMANCE AND STABILIZATION. ED: IF YOU ARE ABLE TO, PLEASE, CAN WE LOOK AHEAD TO THE SECOND HALF OF THE YEAR? WE TALKED ABOUT HOW IN YEARS WHERE THE S&P 500 REGISTERS A DOUBLE-DIGIT PERCENTAGE GAIN IN ONE AGE, IT OFTEN PERFORMS WELL IN THE SECOND HALF OF THE YEAR. I THINK THE NASDAQ 100 HAS SIMILAR PRECEDENT OR HISTORY. IS THAT YOUR EXPECTATION OF WHAT IS TO COME? NANCY: YEAH.

BASED ON WHAT I HEARD FROM THE COMPANIES FROM AN EARNINGS STANDPOINT, YOU ARE HEARING AND MOST OF US ARGUING IT HAS NOT BEEN A GOOD REPORTING SEASON SO FAR. BUT THERE HAVE BEEN VERY MEANINGFUL BRIGHT SPOTS. COMPANIES RAISING GUIDANCE. COMPANIES EXPANDING MARGINS. I THINK THAT YOU HAVE TO AGAIN, AS ALWAYS, LET THE MARKETS WORK THROUGH THIS STUFF. BUT THE SECOND HALF, BASED ON WHAT WE HAVE SEEN AS A COMPANY LEVEL, SHOULD BE BETTER AND UP IN OUR VIEW. SEASONALITY IS IN OUR FAVOR IN AN ELECTION YEAR. THAT IS NOT ALWAYS WORK, BUT WE THINK WE WILL CERTAINLY BE HIGHER BY THE END OF THE YEAR AND EVEN INTO 2025. IF THE TECH TRADE IS OVER, PEOPLE NEED TO BE MUCH MORE WORRIED ABOUT THE REST OF THE MARKET BECAUSE TECHNOLOGY IS

EMBEDDED IN EVERY ASPECT OF
MANY COMPANIES' DAY-TO-DAY, AND THEIR FUTURE EARNINGS AND
MARGIN GROWTH. ED: THAT IS THE ARGUMENT THAT
BLOOMBERG INTELLIGENCE LITERALLY WROTE THIS MORNING.
NANCY, THANK YOU VERY MUCH. COMING UP ON THE PROGRAM, WE
WILL BE JOINED BY MATT FROM WELLINGTON PRIVATE INVESTMENTS
TO GET HIS TAKE ON THE PRIVATE MARKETS LATE-STAGE INVESTING,
BUT THERE ARE ALWAYS PARALLELS WITH WHAT IS GOING ON AROUND
THE WORLD, EVEN WITH PUBLIC MARKETS AND PUBLIC EQUITIES.
I AM REALLY LOOKING FORWARD TO THIS ONE. THAT IS NEXT.
THIS IS BLOOMBERG TECHNOLOGY. THIS IS BLOOMBERG. RIGHT BACK TO FINANCIAL MARKETS.
WE WILL TAKE A LOOK AT THE BLOOMBERG INDEX, WHICH TRACKS
THE MAGNIFICENT SEVEN.

THESE ARE THE BIGGEST MEGA CAP TECHNOLOGIES. AT ONE POINT IN THE SESSION, THE BIGGEST DROP ON RECORD. WE PAIRED THAT. THAT IS THE STORY OF THE SESSION SO FAR, DOWN 3.4%, 3.5% ON THE MAGNIFICENT SEVEN. WE HAVE OUTLINED ALL THE CONCERNS SO FAR. PART OF IT IS THE WORRY ABOUT GROWTH. AND WE CAN WAIT UNTIL NVIDIA'S EARNINGS ON AUGUST 28 TO CARRY ON THAT CONVERSATION ABOUT GROWTH, PARTICULARLY AROUND THE CONTEXT OF GR THAT. LET'S TALK ABOUT THE INVESTMENT LANDSCAPE WHEN IT COMES TOO LATE STAGE PRIVATE TECH COMPANIES. ALSO, IPO TECH ACTIVITY I SUPPOSE WITH MATT WITHEILER, CONSUMER AND TECHNOLOGY LEAD FROM WELLINGTON PRIVATE INVESTMENTS.

ALSO JOINED BY MY FRIEND HEMA PARMAR OF BLOOMBERG NEWS. GOOD MORNING TO YOU, MATT. WHEN YOU WAKE UP TO A DAY LIKE TODAY, YOU ARE LARGELY FOCUSED ON GROWTH STAGE INVESTMENTS. THERE ARE DIFFERENT FACTORS YOU ARE ATTRACTING, BUT HOW DO YOU REACT? HOW DOES IT MAKE YOU APPROACH YOUR DAY-TO-DAY WORK? MATT: THE SHORT ANSWER IS THAT ON A DAY-TO-DAY BASIS, THE FLUCTUATIONS AND VOLATILITY IN THE PUBLIC MARKET DON'T REALLY IMPACT THE LATE STAGE PRIVATE MARKET WHERE WE FOCUS. THERE IS OBVIOUSLY IMPLICATIONS IF THIS PERSISTS WHEN IT COMES TO EXIT OPPORTUNITY WITH RESPECT TO IPO'S AND VALUATION CONCERNS, BUT THE DAY-TO-DAY VOLATILITY DOES NOT REALLY IMPACT THE PRIVATE MARKET

UNLESS IT'S THE -- UNLESS IT
SUSTAINS. HEMA: WHEN YOU LOOK AT AI, GOOD PART
OF THE PAIN PORTION IS IN THE AI STOCK SPACE.
DOES THAT INFORM HOW YOU LOOK AT AI INVESTING WHEN IT COMES
TO LATE-STAGE GROWTH INVESTING AND ARTIFICIAL INTELLIGENCE?
MATT: AGAIN, I WOULD NOT CHARACTERIZE
THE PUBLIC MARKETS AS HAVING A HUGE IMPLICATION IN THE
SHORT TERM ON THE LATE-STAGE PRIVATE MARKET, BUT I WOULD SAY
WITH RESPECT TO AI YOU KIND OF HAVE TO THINK ABOUT AN ADDRESS
TWO QUESTIONS. QUESTION NUMBER ONE, IS AI A
TRANSFORMATIONAL SHIFT IN TECHNOLOGY PLATFORM?
YOU KIND OF HAVE TO ANSWER THAT. THE SECOND QUESTION YOU HAVE TO
ANSWER IS, WHERE ARE YOU WITH RESPECT TO AI-BASED
TRANSFORMATION OR AI-LED

TRANSFORMATION? THOSE ARE THE TWO QUESTIONS YOU HAVE TO ANSWER AS A PRIVATE INVESTOR TO THINK ABOUT WHERE YOU SHOULD BE DEPLOYING, IF AT ALL, AND WHAT THE LANDSCAPE LOOKS LIKE. NOT OVER THE NEXT MONTH OR TWO OR QUARTER, BUT OVER THE NEXT LONGER TIME. HEMA: SO AS YOU LOOK TO INVEST, WHERE IS THE BIGGEST OPTION FOR YOU RIGHT NOW? MATT: I THINK I COULD NOT BE ON THE SHOW AND TALKING TO BOTH OF YOU WITHOUT TALKING ABOUT AI AND AI-LED DISRUPTION. WHEN YOU THINK ABOUT FUNDAMENTAL TRANSFORMATIONAL SHIFTS IN TECHNOLOGY, WE THINK THAT AI IS A DISRUPTIVE TECHNOLOGY THAT WILL BE A GENERATIONAL SHIFT IN HOW TECHNOLOGY IS ULTIMATELY DEPLOYED AND ADOPTED BY ENTERPRISES. BUT TO THE SECOND QUESTION AROUND, HOW FAR ALONG ARE WE IN THAT TRANSFORMATION?

I THINK WE ARE VERY EARLY.
WHEN WE CANNOT OPPORTUNITY SET, WE THINK ABOUT AI.
WE ARE LONG-TERM BULLISH ON THE OPPORTUNITY.
YOU THINK ABOUT SHORTER-TERM, WHERE WE ARE IN THE GAME OF AI,
GIVEN HOW EARLY WE ARE, I THINK ONE OF THE QUESTIONS WE END UP
ASKING OURSELVES WITH RESPECT TO AI IS, WILL TODAY'S WINNERS
BE THE WINNERS THAT PERSIST OVER A LONG TIME?
YOU LOOK HISTORICALLY AT TECH-LED DISRUPTION. WHEN IT COMES TO
GENERATIONAL SHIFTS LIKE THE INTERNET, LIKE CLOUD, LIKE
MOBILE, THE EARLY WINNERS OFTEN TIMES ARE NOT THE LONG-TERM
WINNERS WHO END UP GETTING MULTIBILLION-DOLLAR COMPANIES.
ED: YOU SAID THAT NEAR-TERM OR DAILY VOLATILITY DOES NOT
REALLY IMPACT THINKING IN THE

HERE AND NOW, BUT IT IMPACT SENTIMENTS TOWARDS MARKETS. AND THEREFORE, WE NEED TO ASK ABOUT IPO'S. WHERE DO YOU SEE THE REMAINDER OF THIS YEAR WITH SOME OF THE LATE-STAGE COMPANIES THAT ARE WAITING IN THE WINGS TO GO PUBLIC? MATT: I THINK AS YOU TALK ABOUT THROUGH THE SHOW, ED, THE LANDSCAPE HAS CHANGED PRETTY DRAMATICALLY OVER THE LAST TWO TRADING DAYS. ABSENT THOSE TWO TRADING DAYS, I WOULD HAVE SAID THAT THE IPO MARKET IS PROBABLY ON THE REBOUND, LIKELY TO START ACCELERATING THROUGH THE BACK HALF OF THIS YEAR AND EARLY NEXT YEAR. AND GIVEN THE NOISE, THE VOLATILITY WE ARE SEEING TODAY, WILL IT CAUSE THE COMPANY ON THE MARGIN THINKING SHOULD I GO PUBLIC OR NOT TO REASSESS AND

MAYBE DELAY UNTIL EARLY NEXT YEAR? MOST LIKELY. THAT BEING SAID, IF YOU GO BACK NOT OVER THE LAST FIVE OR 10 YEARS OF IPO DATA, BUT IF YOU LOOK BACK AT THE LAST 50 YEARS OF IPO ACTIVITY LEVELS, GENERALLY, THE IPO WINDOW, IN OTHER WORDS, THE AMOUNT OF IPO'S COMING OUT, TENDS TO BE DRAMATICALLY BELOW THE NORM OR THE MEAN FOR ONE TO THREE YEARS. WE THINK ABOUT WHERE WE SIT TODAY, AND WE ARE KIND OF IN THE MIDDLE OF YEAR THREE, THE FIRST QUARTER OF Q3 OF IPO ACTIVITY BEING MEANINGFULLY DOWN COMPARED TO HISTORIC PERIODS. BASED ON THAT, I WOULD GUESS WE MAYBE HAVE ANYWHERE BETWEEN ZERO AND 12 MORE MONTHS BEFORE WE SEE A REBOUND IN IPO.

ACTIVITY.
AND WE ARE STARTING TO SEE IN THE BENEFIT TODAY.
IF YOU LOOK AT LAST YEAR, WE HAD THREE TECH-LED IPO'S GOAL
LAST YEAR -- GO PUBLIC LAST YEAR.
THIS YEAR, ALREADY FIVE SO AN ACCELERATED PACE. ED:
MATT WITHEILER, CONSUMER AND TECHNOLOGY LEAD FROM WELLINGTON
PRIVATE INVESTMENTS, AND BLOOMBERG'S HEMA PARMAR.
WE WILL TAKE A LOOK AT ANOTHER -- WE WILL TAKE ANOTHER LOOK AT
THE MARKETS. WE GO IN-HOUSE WITH BLOOMBERG
TECH INTELLIGENCE. THIS IS BLOOMBERG TECHNOLOGY. ED: BACK TO MARKETS.
LET'S BRING IN GINA OF BLOOMBERG INTELLIGENCE.
GINA, I AM GOING STRAIGHT TO YOUR BIO ON THE BLOOMBERG
TERMINAL THIS MORNING.

I WILL SUMMARIZE, BUT YOU ARE BASICALLY SAYING LOOK AT EARNINGS IN AGGREGATE ON THE S&P 500 AND STOP BLAMING EARNINGS. BLAME SOMETHING ELSE. WHO ARE YOU HOLDING RESPONSIBLE FOR WHAT IS HAPPENING? I THINK THAT IF WE LOOK AT A SEQUENCE OF HOW THE MARKET HAS MELTED DOWN OVER THE LAST COUPLE WEEKS, IT HAS BEEN PREDOMINANTLY ABOUT TECH AND A LOSS OF FAITH IN TECH. I THINK IT IS IMPORTANT TO CONSIDER WHERE WE HAVE BEEN AS WELL. WHEN WE LOOK AT THE BROAD MARKETS, WE DROVE A COUPLE OF NOTES LAST WEEK THAT ARE PRETTY TELLING. THE FIRST IS WE IDENTIFY 4344 REASONS WHY TECH FACED IMPOSSIBLE EXPECTATIONS. THOSE REASONS ARE BASIS POINTS AND VALUATION MULTIPLES. 4000 BASIS POINTS ABOVE

LONG-TERM AVERAGE OR FIVE-YEAR AVERAGE WOULD SUGGEST THAT EXPECTATIONS PROTECT COMPANIES WERE EXTREMELY HIGH COMING INTO THE LAST WEEK. YOU HAD A COUPLE OF KEY HEADLINE MISSES, BUT FOR THE MOST PART THEY SATISFIED SECOND-QUARTER EXPECTATIONS. IT WAS ABOUT THEIR GUIDANCE, AND THIS IS THE TRIGGER THE MARKET PLAYED ON. THEN YOU PILED ON TOP OF THAT SEVEN KEY MACRO INDICATORS OF THE ISM, THE EMPLOYMENT NUMBERS THAT WERE NOT AS STRONG AS MANY HAD HOPED FOR, AND YOU HAVE A FULL MELTDOWN ON YOUR HANDS. BUT THIS IS REALLY AT THE FOOT OF TECH AND INVESTORS EXPECTATIONS. TECH WAS FAR TOO HIGH COMING INTO THE EARNINGS SEASON. WE ARE NORMALIZING THE EXPECTATIONS AND THAT IS CREATING A BIT OF A PANIC IN

THE MARKET. ED:
INVESTORS' EXPECTATIONS ARE INTERESTING.
I THINK ABOUT MICROSOFT, FOR EXAMPLE, AS JUST ONE CASE STUDY
WHERE THEY MISSED ESTIMATES ON CLOUD GROWTH BY A PERCENTAGE
POINT, BUT STILL REGISTERED 29% TOPLINE GROWTH IN THE MOST
CRITICAL UNIT. IS IT JUST SORT OF
IDIOSYNCRATIC, OR IS THIS BROAD-BASED ANXIETY FOR
INVESTORS THAT SOMETHING WILL GIVE WAY ON THE GROWTH
NARRATIVE OVERALL? GINA: YEAH, I THINK IT IS A GREAT
QUESTION. IT IS DIFFICULT TO TELL SO FAR,
BUT OVER THE LAST WEEK, WHAT WE HAVE SEEN IS JUST SEVERE
PUNISHMENT OF ANY TINY NUANCE, AS YOU CORRECTLY HIGHLIGHT WITH
MICROSOFT. VERY STRONG AGGREGATE GROWTH,
BUT A TINY NUANCE MISS WAS

ENOUGH TO REALLY CREATE A LOT
OF UNCERTAINTY AROUND THAT STORY.
YOU ARE SEEING A LOT OF THE SAME EMERGE WITH AMAZON.
SIMILAR SORT OF REACTIONS, EVEN TO ALPHABET.
SO ACROSS THE TECH AND TECH-ADJACENT SPACE, WE SAW VERY
SIMILAR REACTION FUNCTIONS EMERGE.
I THINK INVESTORS GOT AHEAD OF THEIR SKATES.
WE WERE EXPECTING TECH TO NOT ONLY BEAT BUT TO RAISE
EXPECTATIONS, BEAT ALMOST PERFECTLY. THAT WAS EMBEDDED IN
VALUATIONS, AND NOW WE ARE NORMALIZING THAT.
THIS IS TOUGH BECAUSE AT THAT POINT IN TIME, IT WAS IMPOSSIBLE
FOR TECH TO KEEP CREATING STRONGER AND STRONGER MOMENTUM
IN EARNINGS. WE ARE NOW GETTING TO THE POINT
WHERE THIRD-QUARTER, SECOND-QUARTER EARNINGS OF THIS
YEAR ARE FACING INCREDIBLY

TOUGH COMPS.
TECH EARNINGS. EVEN IN THE BEST CIRCUMSTANCES, WILL SHOW
DECELERATING GROWTH RATES OVER THE SECOND HALF OF THIS YEAR
FOR THE FIRST TIME IN QUITE SOME TIME.
THEY WERE THE ONLY STORY OF ACCELERATING GROWTH IN THE
MARKET IN 2023 AND EARLY 2024. NOW THEY ARE SHOWING SOME
DECELERATING AND GROWTH. THE REST OF THE S&P 500 IS
ACTUALLY SHOWING GROWTH ACCELERATION, BUT WE ARE
IGNORING THAT BECAUSE TECH HAS BEEN SO KEY TO THE MARKET
PERFORMANCE SO FAR THIS YEAR. ED:
YOU CAN ALSO SORT OF PICK AND CHOOSE YOUR DATA POINT.
IN THE FIRST HALF OF THIS YEAR, THE S&P 500 ROSE 14%, LARGELY
ATTRIBUTABLE TO THE MAGNIFICENT SEVEN. GINA: RIGHT. ED:
THE OTHER DATA POINT IS THAT IN

YEARS WERE THE S&P 500 REGISTERED DOUBLE-DIGIT GAIN IN 1H. IT DOES WHILE THE SECOND HALF OF THE YEAR, SO WHICH ONE DO YOU PUT EMPHASIS ON, THE INDEX, OR THE NAMES THAT DROVE THE GAINS INITIALLY? GINA: I THINK IT IS A CULMINATION OF BOTH. I HATE TO WIGGLE AROUND YOUR QUESTION, BUT I THINK IT IS A COMBINATION OF BOTH BECAUSE IF TECH CONTINUES TO SELL OFF, IF WE STILL HAVE WEAKNESS IN TECH, IT IS ALMOST IMPOSSIBLE FOR THE INDEX TO OVERCOME THAT. BUT THE TEXT SELLOFF IS REALLY ABOUT RIGHTSIZING EXPECTATIONS, AND THE REST OF THE INDEX IS PRODUCING GROWTH. THIS IS ONE MAJOR NUANCE WHEN WE COMPARE 2024 TO 2023 IS IMPORTANT TO ACKNOWLEDGE. WHEN TECH SOLD OFF IN THE THIRD

QUARTER OF 2023. REMEMBER, WE
HAD A 10% CORRECTION THIS TIME LAST YEAR AS WELL, BUT WHEN
TECH SOLD OFF IN THAT INSTANCE, IT WAS BASICALLY A ONE-FOR-ONE.
AS TECH SOLD OFF, THE S&P 500 SOLD OFF JUST AS MUCH.
THIS TIME, THE S&P 500 IS DOWN JUST ABOUT HALF AS MUCH AS TECH
BECAUSE YOU HAVE SOME NATURAL STABILIZERS THAT HAVE EMERGED
IN 2024 WITH THAT EARNINGS RECOVERY THAT IS EMERGING IN
THE REST OF THE INDEX. DOES THAT SUSTAIN ITSELF?
CAN IT GATHER MOMENTUM AND ATTENTION?
THAT IS A REAL KEY QUESTION WE SHOULD BE ASKING RIGHT NOW. ED:
YES, THANK YOU SO MUCH THIS MONDAY.
THAT DOES IT FOR THIS EDITION OF BLOOMBERG TECHNOLOGY.
WHAT A DAY TO RECAP ON THE

Tech Selloff Deepens: Nasdaq 100 Faces Worst Drop Since 2022 | Bloomberg Technology

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