MARIA: STOCKS ARE EFFORT IN A
RALLY AS WE LOOK AHEAD TO RETAIL
EARNINGS, DOW INDUSTRIAL
15-POINT S&P UP SIX AND A
QUARTER AND THE NASDAQ RIGHT NOW
HIGHER BY 18, REVERSING EARLIER
YESTERDAY’S LOSSES, BURLINGTON
BEST BUY, DOLLAR TREE, DICK’S
SPORTING GOODS ALL REPORTING THE
QUARTERLY RESULTS BEFORE THE
OPENING BELL.
AS YOU CAN SEE THE BIGGEST
MOVER, YOU BURLINGTON UP BETTER
THAN 3%, ABERCROMBIE AND FINCH DOWN BETTER THAN 2%, JOINING ME
DOWN BETTER THAN 2%, JOINING ME
PROCHAIN CAPITAL PRESIDENT
DAVID, IT’S GREAT TO SEE YOU
THANK YOU FOR BEING HERE WE WANT
TO GET YOUR TAKE ON THE MACRO
STORY AND WHAT YOU’RE EXPECTING
FOR THE RETAIL SECTOR IN YOUR
ASSESSMENT OF WHAT YOU HEARD SO
FAR REGARDING THE CONSUMER.
>> THE CONSUMER IS CAUGHT
BETWEEN INCREDIBLY HIGH PRICES
AT THE GROCERY STORE AND THE
DESIRE TO GET BACK OUT THERE
AFTER YEARS OF COVID AND LIVE A
NORMAL HOLIDAY SEASON, THERE’S
GOING TO BE ATTENTION THERE
HOWEVER, THE WILLPOWER OF THE
CONSUMER IN THE SPENDING DESIRE
IS GOING TO WIN OUT AND WILL SEE A MODERATELY POSITIVE SPENDING
A MODERATELY POSITIVE SPENDING
SEASON ALL AROUND RETAIL TODAY.
MARIA: THOUGHTS ON 2023, WE’VE
BEEN TALKING ABOUT A POTENTIAL
FOR A REAL STRIKE THIS MORNING,
NO DOUBT THAT PUSHES INFLATION
HIGHER.
>> CERTAINLY, BUT BEFORE WE GET
TO THE REAL STRIKE REMEMBER ALL
THE SPENDING IS GOING TO NEED TO
BE FINANCED AND WEEKS IN CREDIT
CARD DEBT SKYROCKET AND
CERTAINLY NOT KEEPING PACE WITH
WAGE INFLATION AT ALL AND REAL
INCOME AT ALL, THEREFORE THERE’S
GOING TO BE A RECKONING OF THE
CREDIT CARD DEBT AT SOME POINT
INDIGO START TO STEER PEOPLE STRAIGHT WITH LOSING JOBS BECOME
STRAIGHT WITH LOSING JOBS BECOME
THE REALITY WE START TO SEE A
BUNCH OF CUTS MOSTLY AROUND
TECHNOLOGY COMPANIES, WE WILL
SEE THEM IN EARNEST GOING INTO
2023.
WITH RESPECT TO THE REAL STRIKE,
CERTAINLY THIS COUNTRY DOES
NOTHING EXCEPT IN TIMES OF
EMERGENCY WE NEED TO SEE SIRENS,
HEAR SIRENS BLARING AND WE NEED
TO SEE THE RED LIGHTS FLASHING.
I DON’T THINK WE WILL HAVE A
STRIKE ALTHOUGH WERE AT THE
PRECIPICE OF ABSOLUTE DISASTER
AS WHERE WE ARE RIGHT NOW.
I DO BELIEVE WILL GO AHEAD AND
GET SOME RECONCILIATION WITHIN
THE NEXT COUPLE OF DAYS.
MARIA: YOU HOPE SO, THE UNIONS
HAVE ALL THE LEVERAGE NOW, THE
LAST TIME WE SPOKE WITH THE
UNIONS THEY SAID THEY WANTED SIX
DAYS, PAID SICK TIME AND THAT
WAS NOT IN ANY DEAL, THEY KEPT
PUSHING BACK IF WE GET SICK WERE
NOT PAYING FOR SICK DAYS, THAT
WAS ONE OF THE STICKING POINTS,
THEY HAVE A RAISE OF 24%.
WHATEVER HAPPENS A LOT OF OTHER
UNIONS ARE GOOD WANTED 24% RAISE
IF IN FACT THAT DEAL STICKS.
DO YOU SEE THIS AS A CATALYST
FOR OTHER LABOR UNREST?
>> CERTAINLY WE HAVE SEEN
UNIONIZATION HAPPENING ACROSS
THE BOARD AND PLACES WE NEVER
SAW BEFORE LIKE AMAZON AND
STARBUCKS SO CERTAINLY THERE IS
A RENAISSANCE IN ORGANIZED LABOR
AND HAVING BEEN AN INVESTOR IN
THE NUMBER OF COMPANIES THAT
WERE UNIONIZED IN TERMS OF THE
EMPLOYEE-BASED AND MULTIPLE
UNIONS AT THAT IN MY HISTORY AS
AN INVESTOR, CERTAINLY THESE ARE
NOT EASY NEGOTIATIONS, CERTAINLY
WHAT THE UNIONS ASKED FOR ON
PAPER SOUND INCREDIBLY
SYMPATHETIC SO THEREFORE IS
OFTEN VERY HARD AT TIMES TO GO
TO RECONCILE AND FRANKLY YOU PUT
ON A IMPORTANT POINT THEY ASK
FOR PREDICTION FOR THE FUTURE
WELL INTO THE FUTURE THEY’RE
ASKING FOR REASONS GOING FORWARD
FOR A NUMBER OF YEARS AND WE
DON’T KNOW WHERE A LOT OF THESE
INDUSTRIES ARE GOING TO GO,
ESPECIALLY THE OLD-LINE
INDUSTRIES WHICH ARE BEING
REPLACED BY TECHNOLOGY SO
THEREFORE THE BASE OF EMPLOYEES
IS NOT GROWING OVER TIME IT IS
ACTUALLY SHRINKING SO THEREFORE
GOING TO BE HARDER AND HARDER TO
KEEP UP ESPECIALLY WITH THE
PENSION BENEFITS THAT ARE
DEMANDED BY THE UNION GOING
FORWARD.
MARIA: A GREAT POINT, LET ME GET
FOR A FEW MORE NEWS ITEMS, ROBERT IGER WASTED NO TIME
ROBERT IGER WASTED NO TIME
RESTRUCTURING THE DISNEY SINCE
HE RETURNED CEO 24 HOURS AGO, HE
TOLD EMPLOYEES WE WILL BEGIN
IMPLEMENTING ORGANIZATIONAL
OPERATING CHANGES WITHIN THE
COMPANY IT IS MY INTENTION TO
RESTRUCTURE THINGS IN A WAY THAT
HONORS AND RESPECTS CREATIVITY.
HIS FIRST STEP WAS LETTING GO
THE MEDIA AND ENTERTAINMENT AND
THAT WAS HIS PREDECESSOR’S
RIGHT-HAND MAN KAREEM DANIEL,
ANY THOUGHTS ON DISNEY, STOCK IS
DOWN PRETTY SIGNIFICANTLY YEAR
TO DATE BUT HAD A BOUNCE ON THIS NEWS.
>> I THINK THIS DISNEY IS A
RISKY SITUATION.
THEY PAINTED THEMSELVES IN THE
QUARTER WITH THE WEB WOKE
ACTIVITY AND BAD PRESS REGARD TO
THE PARKS AND IT’S BEEN A VERY
DIFFICULT OPERATING ENVIRONMENT
FOR THEM.
I THINK ROBERT IGER HAS MASTERED
THE MEDIA BUT AT THE SAME TIME
HE WAS A LEADER AT A VERY
SPECIFIC TIME AND CHAMPIONED
THAT TIME TO GO AHEAD AND PLACE
A BET ON ROBERT IGER TO TURN
THIS AROUND IN A VERY SHORT
PERIOD OF TIME AND HIGHER
SUCCESSOR IN A SHORT PERIOD OF
TIME, I THINK THE LEVEL OF
EXECUTION RISKS IS TOO HIGH I
WOULD NOT BE A BUYER OF DISNEY
AT THIS POINT.
I THINK IT’S GOING ROBERT IGER
HAS NOT BEEN ONE WHO HAS A
SUCCESSOR IN THE PAST TWO SAYS
HE’S GOING TO DO IN A CHARM.
OF TIME NOW AND WHILE THE
COMPANY IS UNDER FIRE.
IT IS NO DOUBT ONE OF THE MOST
VALUABLE FRANCHISES IN THE WORLD
MOST RECOGNIZED BRANDS BUT I
THINK THIS IS GOING TO BE A TALL
TASK.
IT’S KNOCKING TO BE IGER WHO
TURNS AROUND THE COMPANY IS
GOING TO BE HIS SUCCESSOR.
I FEEL LIKE IF DISNEY IS GOING
TO FIND A SUCCESSOR, FIND IT NOW
WHY WASTE TWO YEARS OF IGER
MUCKING THINGS UP BEFORE FINDING
THE REAL SUCCESSOR TO TAKE THIS
COMPANY FORWARD.
>> IT’S INTERESTING TO SEE HIS
ONLY GUY THAT CAN DO IT.
DAVID REALLY CLICK ON OIL YOU
ARE SO SPOT ON OIL GOING TO 100 THIS MORNING HITTING A NEW LOW
THIS MORNING HITTING A NEW LOW
FOR THE YEAR FOLLOWING REPORTS
THAT OPEC IS CONSIDERING
INCREASING OUTPUT OFFICIALS WILL
DISCUSS THE CHANGE OF THE OPEC
PLUS MEETING HAPPENING NEXT
MONTH, THE PRICE OF OIL AT $80 A
BARREL RIGHT NOW, WHAT ARE YOUR
THOUGHTS ON WHERE OIL IS GOING
IN THE FACE OF ALL THESE
DIFFERENT MOVING PARTS LIKE NEW
COVID CASES IN CHINA AS WELL AS
OPEC CHANGES IN PRODUCTION.
>> RECESSION, RECESSION,
RECESSION IS GOING TO PUSH THE
PRICE OF OIL LOWER LIKE IN THE
SHORT TERM.
IN THE LONGER TERM OR
MEDIUM-TERM OPEC IS IN FULL
CONTROL.
I THINK THE MOST SAD PART OF
THIS NARRATIVE HAS BEEN AND WILL
CONTINUE TO BE DIVIDED
DIMINISHED RATIONS FAILED
ATTEMPT TO GO AHEAD AND CURRY
FEVER WITH THE SAUDI’S WHEN THEY
COULDN’T CARE LESS ABOUT OUR
ADMINISTRATION, THEY HAVE BEEN
OFFENDED TO THE POINT OF NO
RETURN AT THIS POINT.
I THINK THEY ARE SURE WE INVITED
NO MATTER WHAT HE DOES THAT THEY
ARE IN ABSOLUTE CONTROL OF WHAT
HAPPENS WITH THE PRICE OF OIL,
THE PRODUCTION OF OIL AND SELL
ONE AND SO FORTH, IN THE RELATED
PARDON IS JUST -- IT IS TELLING
INCREDIBLY.
BY THE WAY, LAST THING ON THIS
POINT IT IS INCREDIBLE TO ME
THAT WE WILL LOOK, WE’VE BEEN
THE PRESIDENTIAL ADMINISTRATION
OF THE COUNTRY WILL LOOK FOR OIL
EVERYWHERE ELSE IN THE WORLD NO
MATTER HOW DIFFICULT THOSE
COUNTRIES ARE RATHER THAN
SUPPORTING THE PRODUCTION OF OIL
AT HOME.
IT IS CRAZY TO ME. MARIA: IT IS CRAZY, OIL PRICES
MARIA: IT IS CRAZY, OIL PRICES
ARE UP RELATIVE TO WHEN HE
STARTED SELLING OIL TO THE
STRATEGIC RESERVE.
WHAT KIND OF A POLICY IS THAT TO
THE SAUDI’S IN VENEZUELA TO PUSH
THROUGH THE CLIMATE CHANGE
AGENDA HERE AT HOME.
REAL QUICK BEFORE YOU GO HAS THE
FTX SITUATION DESTROYED THE
OPPORTUNITY TO LOOK AT CRYPTO AS
AN INVESTMENT, WHERE ARE YOU I
KNOW YOU WERE LOOKING FOR
REGULATION THE LAST TIME WE
SPOKE.
>> HELL NO, HELL NO, FTX IS NOT
DESTROYED CRYPTO.
IT WAS JUST A MIDDLEMAN FTX IS
JUST AN EXCHANGE AS CENTRALIZING
AUTHORITY, NEVER PUT YOUR MONEY
IN THE HANDS OF PEOPLE THAT YOU
DON’T KNOW ENOUGH ABOUT, DON’T
HAVE TRANSPARENCY ON AND
POTENTIALLY DON’T TRUST, THAT IS
THE RULE AND THAT WAS A LESSON
LEARNED FROM FTX OBVIOUSLY A
VERY COSTLY LESSON FOR SO MANY
UNFORTUNATELY BUT CERTAINLY THIS
IS NOT THE END OF CRYPTO
BITCOIN, ETHER, HAVE NOT BEEN
BROKEN IN ANY WAY THEY WILL
MARCH FORWARD AND THEIR
DOMINANCE WILL GO AHEAD AND
CONTINUE TO GROW.