Odd Lots - What's Been Happening With the Iranian Stock Market

Episode Date: November 13, 2023

Back in 2020, we spoke with Maciej Wojtal, a London-based fund manager who specializes in Iranian stocks. This market is one of the most unfamiliar in the world and most investors can't even look up where the country's shares are trading given ongoing sanctions. Of course, there's also constantly changing geopolitical risk, which has only picked up in light of the Israel-Hamas war. In this episode, we find out what's been going on with Iranian stocks in the midst of the recent upheaval and dig deeper into its overall economy after years of isolation from the Western world.See omnystudio.com/listener for privacy information.

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Saturdays and Sundays starting at 7 a.m. Eastern. Make us part of your weekend routine on Bloomberg television, radio, and wherever you get your podcasts. Hello and welcome to another episode of the All Thoughts podcast. I'm Tracy Allo. And I'm Joe Wisento. Joe, have you looked at the Tehran Stock Exchange recently? I have not. Let me look that up right now. I know what's going to happen. Oh, nope, I can't find any data for it.

Yeah. We have actually recorded... Oh, do you know what happens when you look on the Bloomberg? Do you get a warning? I bet you do. Yeah. So if you look, if you're on the Bloomberg terminal and you want to see what it's happening on the Tehran Stock Exchange, you actually get a red bar. And it said sanctions may apply to this instrument and you can't get the data. Yeah, that's exactly right. And we have actually done an episode on Iranian stocks before. And one of the reasons this particular market is interesting is because it has to be the most unfamiliar equity market out there, I think, for the vast majority. of investors. Because of sanctions, you can't access data on it. You're not going to see a lot of news stories on what's going on with Iranian stocks. It's just really hard to get a sense at any single point in time of what this market is doing, what it's comprised of, and basically any information on it

at all. That's right. It's very strange. It exists. There are plenty of stocks on it. You know, it's always sort of interesting, I guess, to be reminded that stock markets exist. exist in all these far-flung locations. Iran, of course, is a relatively big middle-income country, but because of the sanctions, it's just so unplugged into the Western financial system. You never, it just doesn't even come up in any conversation. I mean, you hear much more about, say, the Saudi market or something like that. Absolutely. And I'm almost kind of surprised when I read the numbers behind how big the Iranian economy actually is. Because, again, it's just one that people don't really talk about that much, except maybe in the context of oil exports. But anyway,

as I mentioned, we did an episode on the Iranian stock market a couple years ago. And obviously, Iran is back in the news. There's always been a degree of geopolitical risk in this market for obvious reasons. We already mentioned sanctions. But geopolitical risk has just kicked into high year given the conflict between Israel and Hamas. And so I thought it might be interesting to bring back our guest and just try to take a look at what's happening in this extremely unfamiliar and sort of opaque market. That's right. And obviously right prior to the start of the war, you know, obviously there had been talking, we talked about this with Gregory Brew, actually. There had been this easing, not of the sanctions, but it seemed of the enforcement of the sanctions. And so a lot of

Iranian oil has been flowing out of the country despite the sanctions. And of course, there was that money that the Biden administration had unfrozen and then since refrozen. And so there had been some macro moves happening Iran. Whatever trajectory Iran may have been on is probably on something different now. Absolutely. So we are going to be speaking with our previous guest. It's Matche Voital. He is an investor in Iranian stocks. In fact, I think he's the only, or he runs the only foreign institutional investor that is actually investing in Iran. So again, not a very crowded market and certainly an unusual one. Matcha, thank you so much for coming back on all thoughts. Hi, thank you for having me. So maybe just to begin with, you could sort of give us a reminder of what it is that you and your fund actually do.

For listeners who weren't listening to Oblots back in 2020, what's your mandate? Right. So really like a brief description of what we are doing and why we are doing this. So we run an equity fund. It's a proper mutual fund registered in one of the European jurisdictions. And our mandate is to buy stocks listed on the Tehran Stock Exchange. So Tehran Stock Exchange is the biggest stock market that no one has ever heard of. And it's a proper market. It has around 600 companies listed. More than 50 different industries are present on the market, so it's not a proxy on oil prices. It's around 250 billion dollar market cap and decent liquidity.

So if Iran was properly integrated into global financial markets with no sanctions on it, you know, Iran would be definitely one of the members in MSCI emerging markets indices, or would be the biggest member of MSCI frontier markets indices. But because of all those difficulties that you mentioned, related to sanctions mainly and capital controls, there are no foreign investors there. We got interested back in 2016 when it became legal to start doing anything with Iran. Well, as long as you're not an American investor, Americans still cannot touch the market, but it became legal for everyone else pretty much. But still, you know, half of our work is doing

due diligence and actually, you know, working on operations to make it possible to invest there. But what's interesting why we are doing this is that, you know, you mentioned that it's that you were surprised how big Iran's economy is. And I would say that no, it's actually very small comparing to how big it could get. Because Iran, you know, it's around 90 million people, the largest combined oil and gas reserves in the world. and they properly developed and diversified economy, well, thanks to decades of sanctions, they didn't have a choice. They had to develop all different parts of the economy.

And all this, in terms of GDP, is around, depending how you calculated, but it's around $200 billion. Now, when you look at Turkey, which is a similar size of the country in terms of population and geographical size, but no natural resources, Turkey is around $800,900 billion.

If you look at Saudi Arabia, which has no other, pretty much no other sectors except for, you know, oil and some petrochemicals, the GDP over there is around $1 trillion. So in some, you know, super optimistic, very, very positive scenario, if everything went well for Iran, Iran could become basically the combination of the two, which is anywhere $1.8 to $2 trillion. So the upside for the economy is eight times from where it is right now. So this is the potential. This is the optionality that is in the market. And on top of that, once the country starts to open up,

obviously there is a long list of things that would have to come in place. then we expect to see a lot of capital flowing into the market. And right now it's only domestic capital and us, which means that because there is not enough capital, the, you know, local assets are valued at very low levels. So we, what we are seeing in the market is, you know,

we are buying stocks at four to five times forward net earnings. Those earnings are growing, they are paying dividends, dividends, the average or the median dividend yield, you know, for the top 100 companies is probably close to 15%. So, you know, strong double digit dividend yields, valuations at such levels that, you know, they cannot really fall further as long as those earnings are growing. So investment risks are pretty small, pretty limited. You have different sort of risks. You have geopolitics, exactly as you mentioned. I mean, you know, those those equities basically are priced for war. And obviously there is a reason. It might be a reason for that because it's because it's the Middle East.

And it's amazing how the narrative, you know, the region reminded everyone that, you know, the situation and the perception of the region can make a U-turn overnight. Because a month ago, it was not only what you mentioned in the introduction that, you know, there was some sort of arrangement between Iran and the US, which led to the prisoner exchange, which was very important because historically, prisoner exchange was usually the first step to something bigger. And then on top of that, you know, Iran is selling a lot of oil. So obviously, sanctions are probably, you know, not enforced very, very strictly and so on. But the bigger story a month ago was in the whole Middle East.

where Iran basically signed a, you know, you can call it a peace treaty with Saudi Arabia after many years of not having diplomatic relations. Then what followed were, you know, discussions and restoration of diplomatic ties between Iran and, you know, Egypt, Ukraine, all Saudi allies and so on. You know, I obviously want to talk about the trajectory of the country. But to back up for a moment, obviously the country, as we said in the intro, the country's entire financial system extremely cut off to the point that you can't access the data. Can you talk about how just remind us, for those who haven't listened to the episode,

which I think was late 2019 or early 2020, the mechanics of how you access the Tehran Stock Exchange from where you are? Okay, yeah. So look, you have to access Tehran Stock Exchange website, which actually sometimes you're not able to access it from IPs from outside of Iran. We subscribe to local services, price services like mini Bloombergs in Iran that offer a very decent way of going through the data. So you can not only follow the prices, stock prices, but also it's a good database in a nice

format of historical earnings, quarterly earnings. monthly sales data, corporate announcements, charts or different types of charts, like price charts, fundamental charts, historical valuations and so on and so forth. So this is all available in Iran. You have to find those suppliers subscribe to those services. It's much, much easier if you have people on the ground. So we have an office with three full-time analysts who you know who help with not only you know research but also getting things done because you know some things you actually have to do manually there for example companies pay very high dividends dividend yield is very high in the market but they try not to pay for as long as possible why because

interest rates are high so they try to get this you know interest for as long as possible so you actually have to chase them to pay it right you call them you send faxes right you stuff stuff like So you need someone on the ground to do it on your behalf. This is Caroline Hyde. And I'm Ed Ludlow inviting you to join us for Bloomberg Tech, a daily podcast focusing exclusively on technology, innovation and the future of business. Every weekday, we bring you the top headlines from the world's biggest tech companies. From finance to defence, AI to entertainment and from startups to the magnificent seven.

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And I'm Ed Ludlow in San Francisco. Subscribe today wherever you get your podcasts. Okay, another really basic question on that note. And again, we are unable to access any sort of data. But what has been going on with Iranian stocks recently? Right. So on 7th of October, I believe that it was the case for the whole region that the currency, local currencies sold off and local stock markets went down, obviously.

What happened was that over the, so initially everything went down for the first three weeks, the index, local equity index, measured in dollar terms, was going down with the lowest point around 10% in terms of, you know, the correction. Since then, it started bouncing back. In local currency terms, the equity index is actually at the level from 7th October. So it made up for all the losses. The currency is still down. So from a foreign investor, who is measuring the P&L in dollar terms, you are still roughly 3% down. So it's actually not that bad,

given the circumstances, given that the risk for local markets, and especially Iran, which is involved in everything that is going on, you know, the worst case scenario is that potentially there is a military conflict war and, I don't know, Iranian refineries or petrochemical plants or military targets and so on.

So, then, there was, and people were quite scared, we could see this. Some of the sectors went down in the meantime by about 20% bounced back since then. But mainly that was happening due to very low liquidity. So what was the biggest impact actually we could see was on liquidity. Normal liquidity is around $150 million per day and it went to as low as 30, 40 million. what was going down the most is actually the most illiquid stocks or illiquid industries. So when I look at sectors that really were hit the most, it's textile producers,

confectionaries, you know, so things that are not related to war or geopolitics at all, but they are basically illiquid. And, oh, one thing important to remember. So the stock market is driven by retail investors. 90% of daily trading is done by retail. So, you know, it's very emotional. It's very shorter momentum, I would say. So they are selling or buying, depending on the, you know, recent price action. So they were driving the share price direction, basically. So when you say performance hasn't been that bad, I'm kind of curious what the basis of comparison is because, you know, in a frontier market or an emerging market, if you're looking at, you know, Kuwaiti stocks or something like that. I imagine you would look at the wider benchmark or other

members of like the MSCI emerging market index or something like that. And that would help you gauge relative performance. But for something like Iran, because it's so unusual, it feels difficult to benchmark its performance in one way or another. Yes. And the thing that is most volatile in Iran is the currency. So the stock market is much less volatile in the local currency than when measured in dollar terms. The local stock market is actually well hedged against the currency depreciations because the majority of the biggest companies are actually exporters. So they benefit from currency depreciation. But share prices react with a lack. So for a foreign investor, you initially, usually when something is happening, you usually get hit, see a drawdown due to a big currency,

volatile currency move. And then the stock market usually rallies because, you know, people realize that exporters will start showing better earnings and, and what, share price eventually will always, you know, follow EPS. And the lag is because the market is driven by retail. So, you know, in the US, everything would be, you know, any currency move would be priced in, you know, real time into, share prices of stock that are sensitive to currency moves, right? And in Iran, it sometimes takes, you know, a month or two months, right? So it's actually a big opportunity that you have time to position yourself correctly. But also what you can compare it with is, okay, there are two interesting facts about the

performance of the market. So first of all, when I looked at the last 15 years and big geopolitical events, For example, like previous conflicts with Hamas in Gaza, or there was a situation between Iran and the US where people were saying that this was close to a military conflict when Iranian general Soleimani was killed and then Iran retaliated by firing some missiles at an American base in Iraq. When I looked at the performance of the market,

it never went down more than 10% in dollar terms, actually. So what happened right now, I think the bottom was almost 11% was pretty much in line with those historical geopolitical events that were also presented a big risk for the local market. But another way of looking at the Iranian market is the historical performance. And this is very interesting,

because if you look at the performance of the benchmark equity index. It's called Tet Picks Index, total return. For the last 15 years, so since the inception in 2018, the annualized return in dollars is around 11%, which I think is quite amazing because it's pretty much the same as for S&P 500, maybe 12% for S&P 500. So it's the same ballpark.

And the environment was completely different. I mean, couldn't be more different because over the last 15 years in the US, you had, you know, technology revolution, those mega caps, you know, appearing on the market. Interest rates, you know, initially going to zero. The top of the cycle, you know, margins, operating margins on top of them, you know, top of the top of the cycle, basically evaluations. And in Iran, you had two episodes of currency. depreciation of more than 75%. You had some crazy presidents. You had US sanctions, UN sanctions. And still, at the end of the day, when you measure the performance, compare the performance over the last 15 years, it's pretty much the same. Obviously with much bigger volatility,

because in Iran, the volatility was probably around 40% or something. But that shows you that, you know, when you're buying assets had very, very low valuations, and I'm talking about, you know, there's four times net earnings, let's say, and the economy and those companies are actually naturally hatched against the currency volatility or big depreciation, then, you know, even in those countries where things are going really bad, you can still make money. And, but what is more important is that if in better, At times you were still averaging 11% per year. You know, just think what you can make, what you can expect when, you know, things finally go the right way for Iran and the country opens up and so on.

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wherever you get your podcast. You certainly ask interesting questions. Talk to us about perhaps the signs of a thaw in the several months leading up to October 7th between the prisoner exchange, the expanded flow of oil from the perception of a lower enforcement of the sanctions, Was that showing up in the market in a clear way? And just to sort of emphasize that further, would their way to see that in the sectoral breakdown? So, for example, if there is more oil flowing out of Iran or if there was, was that redounding to the benefit of oil-related, listed Iranian stocks? Good question.

So the question about oil, the answer is no, because oil is not listed. the only oil-related smoke that you can find our local oil refineries that produce you know, produce you know, petroleum.

So they don't benefit from further export. They are correlated to crack spreads because their domestic formula for the price at which they're buying oil from the government is a function of regional

crack spread. So nothing to do with it. But there was one instrument that showed perfectly the higher oil sales is the currency. The currency which I've been talking about that it's so volatile this year it's been super stable around 500,000 real per per dollar and it's been going oh I don't know what's the volatility I haven't checked it but it's you know comparing to the previous couple of years like nothing is going on with the currency. And this is, and this is, this is a clear signal that there are enough reserves,

um, that, you know, central bank of Iran is accumulating. Um, that, you know, the pressure is gone. I mean, it's, you know, it's still very complicated because, you know, bank transfers don't really work, uh, or at least not easy with, with Iran. So whenever Iranian exporters are selling something, whether this is oil, um, or some more formal exports, uh, or some more formal export, and more transparent exports, very often they don't get the money back to Iran. It's somewhere there they get paid to, I don't know, accounts in China or whatever, and it's lying on those accounts. And then money from those accounts can be used to finance imports,

but it's not really coming back to Iran. So it's helping because Iran has probably needs to spend roughly $20 billion per year to finance some essential imports, right? And this is like the minimum amount. If this is missing, then, well, Iran will have to buy dollars at any price. And this is when big depreciations happen, right? Because they need to buy some food, some pharmaceuticals and so on. So they will buy it at any price.

So when this is covered, then on top of that you have budget deficit. But this is again, maybe 10, maybe $15 billion. a billion dollars. So altogether, if Iran manages to get 30 to 40 billion dollars per year from oil sales, things are pretty much sorted in terms of stability, in terms of financing, imports, in terms of, you know, budget deficit and so on. In normal circumstances, you know, countries opened, well integrated with the rest of the world and so on, they will see every month inflow of, you know, several billion dollars that will put pressure actually on the, on the appreciation of the Iranian currency, of the Iranian real.

So, yeah, so that's important. So you could see this change last couple of quarters exactly in the exchange rate. And it's astonishing how, you know, how volatility went down on the effects. So I take the point about the market itself being influenced by currency movements and things like that. But you already described how, the players in Iranian stocks are mostly retail investors. I'm going to assume mostly domestic retail investors too, but you can correct me if I'm wrong. Can you maybe give us a little bit more color about what drives retail sentiment around Iran and inflows? Because I imagine, correct me if I'm

wrong, but like to me it must be kind of a macro story. But maybe people get excited about individual stocks or the prospects for individual companies, but just give us a little bit more of a sense of what drives that sentiment. Yes. So it's, I think, pretty, pretty easy. So it's the dollar, so the exchange rate of the dollar. It's the momentum. So if stocks are showing momentum, then they start chasing momentum. And interest rates, local interest rates. So maybe not central bank interest rates, but whatever the deposit interest rate is. There are several asset classes in Iran for retail investors. So real estate is the big one, the biggest one.

But it's a high ticket item. So not everyone can trade in and out of apartments. It's a well-understood asset class as everywhere. That's why it's a bit less interesting for us. So if Iranians have any spare cash, they will buy real estate. From what I heard, 30% of apartments in Tehran are actually empty

because they are basically used to as a store of value just to park somewhere, you know, assets savings. And they are not even rented out. They are just empty. And also just bear in mind that in Tehran, in the best places, best neighborhoods of Tehran, prices are quite expensive.

So in the north of Tehran, if you want to buy an apartment, you have to pay around $10,000 per square meter. So, you know, a 100 square meter of apartment, I don't know, three bedrooms will cost you, you know, a million dollars or something right in Iran, which is a poor country. So this is real estate. Real estate is number one asset class. Then a very important asset class are used cars. So people trade use cards because they are again a hedge against inflation, against the currency depreciation because car manufacturers will always adjust prices based on inflation. Some of them have to be, some of the components have to be imported, which is not easy.

So they produce more than 1 million cars or actually closer probably to 1.5 million cars per year. but this is not enough. So the demand is much higher. So they're trading used cars and there are platforms that help you trade use cars. It's a proper asset class. And yes, and every Iranian is actually a currency trader. Because, you know, the currency has been so volatile historically that it's very important that you know what's happening to the dollar, right, or to the local currency, you know, against the dollar.

So everyone is tracking, you know, the exchange rate. and it's not easy to buy and sell dollars. There are quotas for individual Iranians due to capital controls. So that's why instead of buying dollars or to buy or to get a bigger position, they go to those proxy asset classes like used cars or real estate. And also interest rates, so you can buy, sell treasury bills, treasury bills up to, you know, two years maturity. they pay around 25% yield to maturity, maybe a bit more right now. So interest rates are high.

And that's another thing. Look, when you look at Iran, there is not enough capital there. There's basically not enough money, not enough credit doesn't exist. I mean, you cannot get a mortgage at 25%, right? I mean, you cannot finance anything at 25%. And because of very volatile macro, people also tend to, you know, postpone

investment decisions, whether these are individuals or more importantly, companies, right? Everyone is looking like six months ahead, maybe 12 months ahead, right? And managing a crisis, because there is always some sort of the crisis, right? So when you think about it, for example, I don't know, every company is running big inventories just in case, just so that they have enough, you know, material to, to manufacture their products. So they are not optimized, organized in this very efficient, you know, lean way. They are organized, you know, just to survive. Survive basically, you know, war, conflict, currency depreciation, sanctions, trade disruptions, whatever. Right. Match, this is exactly what I wanted to ask you, because when

you mentioned, you know, people investing in real estate as a speculative play and the idea of a certain proportion of apartments standing empty in Iran. The example that immediately sprang to mind was China. And in China, there's a lot of money that's sort of trapped and recirculating in the economy. I used to call it China's great ball of money because of capital controls. And I imagine maybe there's a similar issue in Iran where there's not enough capital, but there's a lot of domestic savings that are sort of are unable. to get outside of the Iranian economy.

Is that the right way to think of it? So my understanding is that it used to be the case, that Iran, when you looked at household savings, was top of the list when you look at emerging markets, at least in like purchasing power, you know, parity way of looking at this. However, last couple of years have been really tough for Iranians due to sanctions. So when sanctions were reintroduced in 2000, they haven't heard manufacturing. They haven't heard exports companies that much to be honest. I mean, because, you know, people find a way. I mean, companies that export in the region, they are not really affected by sanctions. Big exporters that used to send, you know, products to Japan and so on. Yes, they were affected, but they felt other routes. And manufacturers, you know, sanctions cost one thing. I mean, sanctions caused the currency volatility. So the big depreciation.

of Rial and manufacturers who have costs in Rial, but they either sell in hard currency or at prices linked to some regional benchmarks that are in hard currency, their margins actually expanded. Look, it's an interesting thing that the highest earnings growth that we've seen over the last couple of years was one year after the 2018 sanctions. is this is crazy because this is you know not not as intended i would assume right and and who got heard by sanctions well households because they are price takers so when the inflation shot up because of the currency depreciation um they their spending power went down massively right and and and and they were able to survive and that it was actually quite interesting that they were holding up quite well

and this is because of those savings right of the high high savings that iranian households had i'm I'm not sure was the situation right now because they've been, I think, you know, on a net basis, those savings have been decreasing over the last couple of years because they had just had to spend them. But yes, that's what helped them, you know, survive the inflation. I just have one more question, I think. I mean, when we talked about this a few years ago and obviously earlier on the chat just now, and you were talking about comps within the MSCI or perhaps expectations that one day there would be a proper easing of relations between Iran and Western capitals and that that would open up markets, etc. Presumably a lot of that is the expectations are going to reverse.

But could it be that that never happens and that the future is just a much bigger sort of Chinese-centric sphere of financial, influence in the region, exports across Afghanistan, more trade with Russia, and that Iranian companies end up benefiting from the emergence of basically separate. You know, people talk about the bricks, for example. This is the de-globalization idea. Yeah, that basically instead of it one day becoming plugging more into Western financial system, that it never does that. It just plugs into another large emerging financial system but to the benefit of Iranian companies. This is what's happening right now. Absolutely. This part of the regionalization trend in terms of globalization. Iran is being accepted to all those organizations like like Bricks,

like Shanghai Corporation Organization, which doesn't mean much because these are just political organizations. But on the other hand, it means that, you know, it's not isolated there, right? that the country is welcome and will be part of those, you know, potentially different systems, which can be, I don't know, financial systems or economic ecosystems. So yes, absolutely, this is happening. However, there is another big factor that will be driving Iran's direction in the future. And it's the population. It's demographics.

Look, 90 million people live in Iran and two thirds of them were born after. the revolution in 79. So they can't really relate to any revolutionary slogans. They have their own vision for the country idea. They basically have their own vision of their lifestyle that they want to have, right? And this is the same trend that is happening in other countries like Saudi Arabia and Saudi Arabia is liberalizing a lot of areas of life. And, you know, it's a very good decision, but I think that actually they don't have any other choice because, you know, whichever country we're talking about, the local regime, the local government, you know, at the end of the day, wants to stay in power, right? So they need to adjust to basically have, you know, their population

happy and accept the status quo in terms of, you know, the power and the regime and so on. So they have to change. And this is driving countries. I mean, same with, you know, protests that you could see at the beginning of the year in in Iran, women protests. This is all changing the country, even if it's not visible immediately. It's a massive force. And I think this will also affect the direction of the country. All right, Matcha, thank you so much for that really interesting conversation on a market that we don't often hear a lot about. Thanks for coming back on all thoughts. Yes, great. It was great. Thank you so much. Yeah, that was great. Thank you so much. Really appreciate it. And great to chat with you again. We'll chat with you again in three years.

Right, right. Yeah. Iran teaches you patience, right? Yes. It opens up very, very slowly. So, Joe, that was really interesting. And we'll have to talk to Matcha again in, I guess, three years' time to see what's been going on. But I thought the mention of apartments and used cars as speculative investments, I had never heard that before for Iran. That was super interesting. And again, his point that it was. was sort of like China, but actually now a lot of personal savings have been run down. I guess that makes a lot of sense given the situation recently. I thought that was an incredibly fascinating conversation because, yeah, I mean, there are some sort of basic macro principles that apply regardless of the situation the country finds it's in this idea that corporations in Iran operate with higher stockpiles of raw materials and other inventories, the opposite of lien, which of course It's the corporate side of the personal savings rate, right? Like you have to build your own cushion.

Yeah, right. In extreme uncertainty, you're not going to operate with sort of minimal. Obviously, American investors want to see, oh, get your inventory levels down. Get your cash levels down. Efficiency. Right. That's not the way any company is going to react in a country that's constantly buffeted by various geopolitical forces and sanctions and many unexpected things. the idea that there is this sort of beginning of increased relationships, maybe just political so far, but plugging into China and the bricks, et cetera, and maybe it just never happens. I thought it was a very interesting conversation. Yeah, I liked your last question because I think, you know, maybe a couple decades ago, there would have been an assumption that a country like Iran would be absorbed into the global

economy. You know, you have this booming population and the line of globalization was always going up. But I think in 23, there's certainly a question mark around that. And it does seem like we're heading more towards those sphere of influences, as you mentioned. Yeah, a few big spheres of influence rather than an expectation that it all sort of funnels into one one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, one, let's leave it there. Let's leave it there. Let's leave it there. Okay, this has been another episode of the Oddlots podcast. I'm Tracy Allaway. You can follow me on Twitter at Tracy Allaway. And I'm Joe Wisenthall. You can follow me on Twitter at the stalwart. Follow our producers, Carmen Rodriguez, at Carmen Armin, Dashel Bennett at Dashbot and Kale Brooks at

Kail Brooks. Thank you to our producer, Moses Ondom. For more Oddlots content, go to Bloomberg.com slash odd lots, where we have transcripts, a blog, and a newsletter that comes out every Friday that Tracy and I write. And check out our Discord. Discord.org.G. slash Oddlots, where listeners are chatting with each other 24-7 on a range of topics. Really fun place to hang out. And if you enjoy Odd Lots, if you find it interesting when we do deeper dives into more unfamiliar

markets, then please leave us a positive review on your favorite podcast platform. Thanks for listening. On April 4, 2023, around 2 in the morning, a man was fast. stabbed multiple times on the sidewalk in downtown San Francisco. Hey, we did this to you. What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16.