MARIA: WELCOME BACK, LET'S CHECK
MARKETS, EUROPEAN INDICES MIXED,
CAC QUARANTE IS FLAT AND
INVESTORS ACROSS THE WORLD WATCH
BRITISH PRIME MINISTER THERESA
MAY AND EXIT FROM EUROPEAN UNION
SOME CALLING VOTE OF CONFIDENCE,
JOINING US STRATEGISTS DIRECTOR
MARTY, GOOD TO SEE YOU THIS
MORNING, THANKS FOR BEING HERE.
>> THANKS FOR HAVING ME, GOOD
MORNING.
MARIA: WE SAW THE BRITISH POUND
FALLS AND A HALF PERCENT
YESTERDAY.
A LOT OF DRAMA AROUND BREXIT,
WHAT IMPACT DID YOU SEE FROM
THERESA MAY'S PRESS CONFERENCE
AND THOSE PARTNERS OF HER THAT
IS RESIGNED, OFFICIALS FROM
GOVERNMENT?
>> WHAT WE ARE LOOKING HERE IN
THE UNITED STATES IS A BUFFER
MOST OF WHAT YOU'RE SEEING, WHEN
IT WAS FIRST ANNOUNCED THE BANKS
AS WELL AS THE MARKET AS A WHOLE
TOOK IT ON THE CHIN AND REALLY
THOUGHT OF UNCERTAINTY, RIGHT
NOW WE ARE WORKING THROUGH
DETAILS.
EVENTUAL THEY'LL GET TO SOME
CONCLUSION HERE BUT WE'VE SEEN
BUSINESSES CONTINUING AND IT
REALLY IS JUST TRYING TO GET TO
FINALITIES AND WHERE THEY
WANTING TO.
MARIA: WE HEARD FROM BILLIONAIRE
INVESTOR JONES HE SPOKE AT HEDGE
FUND CONFERENCE YESTERDAY
COMMENTING ABOUT GLOBAL DEBT AND
SAID FROM 50,000 FEET VIEWPOINT
PROBABLY IN GLOBAL DEBT BUBBLE,
GLOBAL DEBT IS GDP AT ALL-TIME
HIGH, HE SAID THAT WE COULD SEE
THIS BUBBLE BEGINNING TO POP, HE
SAID THAT THE TRUMP
ADMINISTRATION'S CORPORATE TAX
CUT FROM LAST YEAR COULD HURT
INVESTORS IN THE FUTURE AS THE
FED CONTINUES TO RAISE RATES,
MARTY, YOU HEARD THE COMMENTS
YESTERDAY, HOW IMPORTANT WERE
THEY IN THE MARKET AND WHAT WAS
YOUR REACTION?
>> AGAIN, WHAT WE ARE LOOKING AT
HERE IS A WAY AND AN AVENUE,
BANK LOANS ARE ACTUALLY A LOT
LESS THAN WHAT THEY'VE BEEN IN
THE PAST, ONE OF THE BIG
COMPLAINTS IS WE HAVEN'T SEEN
LOAN GROWTH, A LOT OF IT THIS
STUFF HAS MOVED INTO DEBT OR
CAPITOL AREA, WHAT WE HAVE SEEN
IS REALLY THE TAX REFORM HAS
CREATED A LOT OF CASH FLOW SO
THAT CASH FLOW FROM THESE
ORGANIZATIONS AND BUSINESSES
GIVES THEM THE ABILITY TO PAY
BACK THAT DEBT AND PAY BACK SOME
OF WHAT WE ARE SEEING IN THE
LENDING SIDE, WHAT WE SEE IS
STABILITY THERE.
MARIA: MICHAEL BLOCK, LET'S TALK
ABOUT THIS FOR A SECOND, DEBT IS
AN ISSUE, IT'S NOT AN ISSUE SO
LONG AS CONFIDENCE IS STRONG BUT
WHEN DO MARKETS START FOCUSING
ON THE CORPORATE DEBT LEVELS AND
THE FEDERAL DEBT, IS THAT AN
ISSUE MORE MARKET?
>> GREAT INVESTOR AND THERE'S
ANOTHER GREAT INVESTOR WHO
WEIGHED IN RECENTLY AND SIGNS TO
DEBT BUBBLES, GEORGE SOROS HAS
WRITTEN IN THE PAST.
THERE'S A SON IF THERE IS
HIGH-DEBT SERVICE LEVELS THAT
CAN'T BE MET AND KEY ENTITIES
AND A LOT OF TALK ABOUT GE AND
U.S. GOVERNMENT DEBT THERE, WE
HAVE TO ASK IS U.S. DEBT MAKING
THEM STRUGGLE AND AT THIS POINT
THE ANSWER IS NO AND WITH GE WE
WERE TALKING ABOUT THIS EARLIER
FOR A LONG TIME.
WE CAN'T READ INTO THIS.
COULD WE HAVE A CORPORATE DEBT
CRISIS DOWN THE ROAD, IF THAT'S
WHAT HE IS TALKING ABOUT, HE HAS
A GOOD POINT.
>> DON'T YOU THINK THERE'S
INCREASE IN DEBT LEVELS AND
INCREDIBLY LOW INTEREST RATES
FOR A LONG TIME.
THIS IS NOT A SURPRISE, IF YOU
KEEP INTEREST RATES NEAR ZERO
GLOBALLY, COMPANIES WILL RESORT
IN RAISING DEBT WHICH IS WHAT
MARTY IS SAYING, BASICALLY THIS
IS A CHOICE THAT COMPANIES HAVE
MADE AND NOW AS INTEREST RATES
GO UP IT'LL CHANGE.
>> WELL, I THINK THAT IT IS
EXACTLY RIGHT AND WHAT WE ARE
SEEING IS CASH BALANCES EXPANDED
AS WELL.
>> RIGHT.
>> THE ABILITY TO REPAY IS STILL
STRONG AND WE ARE NOT SEEING A
TIPPING POINT AT THIS POINT AND
HOUSEHOLD DEBT IS ACTUALLY
PRETTY GOOD, SO WHAT WE ARE
SEEING THERE IS A VERY STRONG
HOUSEHOLD SECTOR KIND OF
WEIGHING IN AS WELL.
BRIAN: MARTY I'M SURPRISED SEE
TUDOR BLAME TAX CUTS, IT SEEMS
TO ME WE NEED THE GROWTH FROM
TAX CUTS IN ORDER TO BRING RATES
BACK UP TO SOMETHING LIKE A MORE
NORMAL LEVEL, ISN'T TAX CUTS
LEADING TO GROWTH PART OF THE
SOLUTION TO THE DEBT PROBLEM?
>> WE SAW THE NUMBERS, 4.2% IN
SECOND QUARTER, 3 AND A HALF IN
THE THIRD.
>> WELL, THE GDP GROWTH IS
EXACTLY THE CURE FOR THAT IS THE
GROWTH.
WE HAVE -- INTEREST RATES ARE
TILL HISTORICALLY LOW THAT THE
DEBT BURDEN AND THE SERVICE FOR
THIS DEBT IS VERY DIGESTIBLE,
YOU KNOW, AS WE ARE MOVING RATES
UP, WE ARE NOT -- EXPECTING FOR
RATES TO GET BACK TO WHERE THEY
WERE AT LAST PEAKS, WE HAVE A
LOT OF ROOM HERE TO SEE RATES UP
ANOTHER 75 BASIS POINTS, 100
BASIS POINTS AND STILL STAY AT
LOW RATES AND AFFORDABLE LEVELS.
MARIA: REAL QUICK BEFORE YOU GO,
BANK STOCKS, DOWN 4% IN THE
MONTH OF OCTOBER, WOULD YOU BUY
FINANCIALS HERE?
>> WE WOULD, YES, WE THINK THAT
FINANCIALS ARE THE KIND OF THE
CANARY IN THE COAL MINE WHEN YOU
THINK OF THE RECESSION FEAR THAT
GRIPS LATE-CYCLE FEARS, THE
BANKS GET HIT THE HARDEST, IF
YOU LOOK AT FUNDAMENTALS,
EARNINGS ARE CONTINUING TO MOVE