Asking how shaky earnings outlook.
Jonathan Ferro
Jason Draho
Guidance going into Q1 good; revisions optimistic; tech/semi results good; 11% EPS growth not in jeopardy abstracting Middle East.
Setup going in is good despite high bar.
Asking if situation so bad it must get better like 2022.
Jonathan Ferro
Jason Draho
Don't underestimate economy's resiliency; supply chains create problems but also opportunities; US economy can solve problems.
Economic conditions not as strong today but still resilient.
Asking if supply shocks accelerate AI capex.
Jonathan Ferro
Jason Draho
AI capex strong but other investment weak; companies will move toward supply chain resiliency but hard to invest with uncertainty.
Not key driver for next quarter or two.
Asking about hedging optimism.
Jonathan Ferro
Jason Draho
Inflation shock from oil/commodities hard to hedge; can use commodities exposure or de-risk; stay front of curve on rates.
Ultimately inflation shock really hard to hedge.
Asking if markets prepared for serious escalation.
Jonathan Ferro
Jason Draho
If serious escalation, markets transition from inflation shock (Fed hikes) to growth shock.
Status quo bad enough with tight physical markets and shortages.
Noting Max Kettner view that less bad news is good enough.
Lisa Abramowitz
Jason Draho
Key is oil flowing through Strait of Hormuz; status quo without improvement is problem; markets assume improvements in next 1-2 months.
If no improvement, prices go higher, growth marked down.
Noting blockade escalation today stopping remaining oil.
Jonathan Ferro
Jason Draho
Oil tanker or two vs 30 normal flow marginal change; administration may be preparing to improve oil flow with military security.
Positive for markets not being discussed.