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00:00Much of your calculation headed abroad, is it to do with what's happening with the Fed and a very red hot labor market? Very we think the stock market, particularly in the United States, is too focused on the inflation story and isn't paying enough attention to what could be happening with recession. And so the stock market here has been up about 15 percent since the end of the third quarter of twenty twenty two to us. That was a great opportunity to trim our stocks. We've been doing rebalancing and in some of our portfolios, we've been actually moving some of our allocations in stocks back into bonds, which we had lightened up on ahead of 20 22. So we think investors should be looking ahead. We think the story is really about a possible recession. Inflation is coming down. That's great. A lot of folks are making predictions about what's going to happen with the Fed in terms of backing off from further rate increases later in the year. That could happen to us. It doesn't make any sense to make any strong calls with the Fed with inflation or even with processing, for that matter, because it's hard to get those calls correct. It's hard to give them time. Right. And we're telling our clients who are corporate executives, family business owners and entrepreneurs to stay diversified. So when you say non U.S. stocks and you're going abroad, does that mean advanced or emerging markets? Both of we have we are favoring emerging markets with China opening back up after the pandemic through the early days of the pandemic. We see opportunities there. There's less macro risk in the emerging market currencies. And we're seeing in the developed market currencies, valuations are a lot more attractive. So we think over the long term and we're looking out 10 years as opposed to 10 months, we think emerging markets are the place to be. But also, we like Europe and Japan. So we're being broadly diversified overseas. Sandy, will you take a look at emerging markets and what's going on with the Dani Burger? Now, what are the elements of caution that you might be exercising? Because this is obviously an not uncommon theme given we've seen similar episodes with some of the big Chinese conglomerates, Heidi. Diversification is key not just across broad equity asset classes, but within those equity asset classes as well. So when we are making investments in emerging markets, we're looking at a broad diversification of countries and companies, and we're really focused on companies with relatively low valuations and good fundamentals. And so we think being broadly divide versus buy there is going to help. So far, the Johnny situation does seem to be contained, but the diversification will continue to help us out if if it does get a little if it unravels a little bit more. Do you find value in tech right now or in the ongoing months? If we do see even more of a moderation? The tech stocks have definitely sold off quite a bit. We're looking for deeper value. We do like some of the tech names. Microsoft, Apple and Google are certainly a few cult quality companies. And we do like those, but we're looking for deeper value, more in consumer products and also in financials and in materials as well. Also considering the bond yields trajectory from here. It is so interesting right now the stock market is signaling a soft landing here in the US. The bond market with its inverted yield curve is signaling a recession. Despite all of that were we're more aligned with the bond market right now. Our concerns about recession are real right now. The 10 year yield is below the three month yield that's happened eight times before and all of those eight times it's ended in recession. All of that said, we do like bonds in twenty twenty three coming off their double digit declines in twenty twenty two. We are expecting them to deliver attractive returns this year and help bolster volatility in the overall portfolio. So we haven't been backing off of them, but we're keeping 30 to 40 percent of our allocations in bonds and we think that's a good place to be.

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Aspiriant's Bragar on Investment Strategy, Economy

Sandi Bragar, Managing Director at Aspiriant, discusses her investment strategy and particularly the opportunities Aspiriant sees in non-US equities. Bragar speaks in "Bloomberg Daybreak: Australia" with Shery Ahn and Haidi Stroud-Watts. (Source: Bloomberg)

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