>> welcome to bloomberg markets. i'm matt miller. a rally that drove stocks to a series of all-time highs running out of steam a bit today but the trump trade is still on. if you take a look at where the markets are trading, we have the s&p 500 off a third of 1% but we are at 5980 and we did cross over 6002 close higher than that yesterday for the 51st or 52nd record high this year. we typically see 18 record highs

on average going back to the 1950's so we are well above that level. the nasdaq coming down a third of a percent over 21000 and the dollar at the strongest level we have seen since november of 2022. if you read the scott besson piece either wall street journal, you know the day after donald trump was elected we got one of the strongest rallies in the dollar. the third strongest we have seen over the last 10 years. real conviction behind that should the 10 year yield coming back up almost 13 basis points. this is something we saw the week of the election. the 10 year yield rallied from 428 almost two 450. back down to 428 again. now we are getting back in terms of the yield for 43 on the 10-year. -- yield for for free on the 10 year. >> after seeing bitcoin trade as

high as i thought it doesn't dollars for bitcoin, we have seen a pullback from that. the last time i looked, down 7/10 of 1%. the little bit of a breather weakness taking off some steam from some of these stocks. marrow holdings -- mara holdings yesterday. most of these stocks up 20% yesterday. continuation of the trump trade rally. the expectation the trump administration will be friendly to crypto. the first administration for president-elect trump, that was not the case. the shift here but the bitcoin and crypto bulls are liking it. we are seeing a pause for the shares of tesla ceo elon musk president-elect trump's biggest fans. the stock into today out of the election had been up 30 to 40% up five days straight. there is some anticipation perhaps regulation around ai or those robotaxis could be helped

out. we don't know if that is the case. that could be a big piece of the 30 to 40% rally into today. live nation, we have shares higher up 4.8%. adjusted operating income was better than anticipated. morgan stanley saying the view ahead is good and a lot of this driven by concerts. roughly 8% short interest on the shares of live nation so some of today's move higher could be a short squeeze. matt: abigail doolittle looking at some of the stocks moving in this market. we are watching all the details we can get from the coming trump cabinet. it is beginning to come together in washington. one of his likely picks for treasury secretary is key square capital founder scott besson who wrote the wall street journal op-ed and spoke with bloomberg on election day.

>> we have had a real-time experiment. we had a trump presidency that delivered low inflation, high we'll wage growth and -- hi real wage growth. we also have an experiment with vice president harris and joe biden where we had the highest inflation in 40 years. the bottom 50% of workers are getting crushed and i call it the three i's. inflation, interest rates and immigration. matt: for more we are joined by salai on mohs and. . she is live in washington, d.c. treasury is one of those positions where there are a lot of names in the hat but it does seem like scott besson is one of the front runners. >> i don't know if he is a front runner but i can say most of trump's key advisors are backing

him for the job of treasury secretary. we don't know when an announcement could come. we are expecting it sometime this week and we have had a lot of announcements quickly over the last few days from the trump campaign which is headquartered in the transition efforts and interviews and nomination and appointment news from mar-a-lago in florida right now. matt: if you type on the bloomberg ws l space election, you can see the betting odds and polly market which has a substantial amount of volume in treasury has nine potential candidates with scott getting 80% odds to at any terms of the betting market, it does look like he is a front run or. in terms of secretary of state, it looks like marco move rio -- marco rubio be in the running. what to we know about that? >> we know marco rubio -- as it was first reported by the new

york times marco rubio is expected to get the job of secretary of state but that it has not been formally announced it secretary of state and treasury are the two plummy us to posts when you're looking at a transition team the bill. we have seen a couple other announcements come through which were a little surprising. you can see where the president-elect's focus is for the next administration so let's see if we get a secretary of state and treasury announcement later this week. matt: do we know anyone for certain? what do we know from president-elect trump himself? saleha: we don't nose or terry of or treasury for certain. we know white house chief of staff is the first female to hold that spouse -- that post, susie wiles. we have had a number of other announcements. you and ambassador and epa picks paired national security, we have michael waltz coming from the house side and we are still waiting on state and treasury. matt: and of course senate majority leader could be

politically one of the most important posts here. donald trump has said he once whoever wins this position to allow him to point cabinet members during recess. do we know if anyone has a lead there? i know rick scott has got his hand up and has run in the past. what to we know about that? saleha: it is important to be careful any of these because well in presidential race where public race, you can have a front-runner based on polling but these are private decisions. president-elect trump make his own decisions who his cabinet pixar ship same goes for the senate who the majority leader is going to be. that is going to be done in secret beliveau. all the aims you mentioned, those are in the -- all the names you mentioned, those or any the mix. matt: working around-the-clock to determine the next government

under president-elect donald trump. here is some of what the financial leaders around the world have and saying about donald trump's election victory. >> he cares about market discipline. if bond yields go higher and the stock market correct, bond vigilantes and markets saying your policies are unsustainable. > we don't set our business plan based on political agendas. look at the fundamentals and making sure the investments we are making our advantage for the rest of the industry. >> we see tariffs as being disruptive of market forces. the world is going towards less of a free market environment so we will manage within the tariff structures put in place. >> don't expect any near-term response from the fed but in the longer term if trump does what he said he is going to do, it is going to be a difficult economic ride. let's watch his actions, watch his deeds and work with him onyx

letting why these things are good for american businesses, european businesses and everybody else. is a former constructive way of engaging with this administration. matt: joining us with his take on the trump -- his take on the trump when in the markets is the president, partnering cofounder at hollow brook wealth management. he joins us from florida. thanks for your time. let me ask you about the amazing valuations. we have reached new heights on the snp. over 6000 at yesterday's close. what we are seeing in investment grade credit markets with spreads tighter than they have been all this century. >> we all thought markets had priced in trump victory but it turns out they did not. look where the markets are. we were at 25 times earnings. if you look at price of sales ratios, price-to-book values, these are levels we have only seen back in 1999 during the dot-com bubble.

credit spreads are as tight as they are since right before the financial crisis in 2007. part of this is concerning and makes one wonder how tall can the trees grow but there is a lot of optimism built into this. we have had a republican trifecta win here and there is a lot of economic optimism. matt: one of the leaders we were listening to was the ceo of exxon. it does seem like energy although that industry has benefited spectacularly in terms of production and stock prices under the biden administration is poised to do even better. where are you looking for the most gains? philip: it is a very good point because if you look at america's energy production particularly oil and gas, we have done incredible things over the last decade under either

administration. we are over 13 million barrels a day in production which far eclipsed is saudi arabia. i think the investment that is very interesting as you pointed out, we need oil and gas. we are not getting off oil and gas anytime soon. the energy transition is an area that has been underinvested. i'm not talking about wind or solar. talking about nuclear lng exports. trump has talked about that. and a tailwind from this. these are all sectors that have seen a lot of underinvestment the last decade and despite that, the end up in has performed. matt: we don't know who will be in donald's cabinet or what he is going to do in terms of tariffs, taxes, legislations. what are some of the safer bets in terms of industry investment? what are some of the changes we are going to see in the business world as a result of republican

troll of the house, the senate and the white house? philip: one thing we really have to realize here is there has been a ton of liquidity put into the financial system from the prior administration. we had the chips act. we have the inflation reduction act. all of this is still out there sloshing about and pushing valuations higher. there is a lot of money on the sidelines. there is a lot of sectors of industries that will benefit. we talked about energy and the energy transition area. innovation, venture capital is an incredibly interesting position under this trifecta scenario of the republicans. credit could be very interesting depending on how the yield curve behaves. things like farmland, great inflation hedge or even well card easing. these are not gently things fine

in the public markets. these private type investments have a strong tailwind under this scenario. matt: you have made the important point about volatility we are seeing not necessarily in the markets but in politics. over the last we have had nine in which the voters have kicked out the incumbent and that makes it difficult to do business even in a world where asset prices looked to be going in the right direction. how do we deal with that or how do you deal with that as a business leader? philip: this is a super important point and not a lot of people have talked about this. jason traynor who sits on the research board pointed out this fact. if you look at the election since 2006, we have had nine changes of parties in power. this has not happened since reconstruction after the civil war. what that means is political volatility translates into uncertainty for businesses,

health care policy, tax policy. what that means as a investor come as a steward of assets for families come individuals, you have to take a long-term view. just because the dow is up at record highs today, if we were to see a 30% correction in markets, i don't think anyone should be surprised but this is long-term. if you look at the markets behavior over these nine different terms of swaps from republican to democrat back to republican, markets have endured that and continue to go northward. matt: thanks so much for joining us philip richter, president, partner and cofounder at hollow brook wealth management. coming up, home depot reported results today and we are getting into the nuts and bolts of it. this is bloomberg. ♪

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matt: this is bloomberg markets. time now for our stock of the hour. home depot reported earnings this morning notably lifting its forecast for outdoor product sales. the stock is lower today but you can see the stock is up nearly 18% year to date. we are joined by loop capital markets managing director laura champagne. let me ask about the results we saw and the outlook. i would have thought the hurricanes are good for business at home depot in the quarters coming up but maybe not the reporting quarter. >> normally hurricanes like this are very messy so we would have expected more disruption in this

quarter and benefits in the quarters to come and they are guiding for a little bit of that but we don't think the big ticket remodelings and repairs, we don't think there are expectations over the next few quarters. matt: you have a buy on the stock and i look at the sales over think a quarters, they are already. why are you thinking this is a good stock to own? laura: we made that call a month ago. we were not there for most of those two years. we downgraded the stock in october of 2021. now that rates are headed lower and we have had these two lousy years for the big ticket sales which were more profitable, we think they're more likely to turn the quarter. markets will anticipate that in the next six months. matt: we have had 75 basis points of rate cut so far. if the fed continues on this path, it starts to shake up the housing market. can people go out and do the

remodeling projects they have been waiting for? laura: there are two factors that can drive more remodelings. the first is lower rates in the second is time. people's lives change at some point. we must see existing home sales that turnover should improve just as people go through the natural stages of life. at some point kitchens and baths will need to be remodeled. at some point those quick fixes we did during covid, it will be time to refresh again. matt: are there any concerns about tariffs? president-elect trump has said he was to put tariffs on china toe 60%. 10 to 20% on every buddy else including europe. . i would have thought if i had not into it this morning home depot was carrying a lot of chinese products. laura: they do carry a lot. they like to find this loophole of they don't source directly more than 5% of what they sell. most of what they sell is domestic. there is a much higher than 5% percentage points they carry from china. they will have to find

alternative sources. tariffs are going to be tough across the board home depot has an advantage given its scale. matt:matt: you cover a wide variety of companies from costco to whirlpool, t.j. maxx, wayfair . are all these companies in your never starting to worry about potential tariffs? laura: all of them except those manufacturers. will, largest emetic manufacturer does some of its tooling in the u.s. they should be well-positioned. i cover mohawk, the largest a matching -- the largest domestic floor manufacturer. tempur sealy, the largest american domestic betting manufacturer. those companies are well-positioned. the retailers have negotiating to do. matt: i want to ask about lows because i think may be determined by where you live but some people have a favorite store. does home depot win out in that competition? are they up and down? who is the better big box home

repair retailer? laura: home depot in june bought a company called srs. srs caters to big pros who do roofing, landscaping, they have thousands of salespeople. this is a new skill set for home depot. probably pushes home depot's growth a few percentage points ahead of lows for the next three to five years. matt: great having you in the studio. laura champagne is capital markets managing director at loop. coming up, elliott investment management has built a more than $5 billion position in honeywell. it is elliott's biggest position ever and they are pushing honeywell to breakup the business. the bloomberg reporter who broke that story joins us next. this is bloomberg. ♪

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matt: >> >> activist investor elliott has built a $5 billion stake in honeywell. it is urging the company to breakup its business. during us is one of the supporters who wrote the story. what a fantastic scoop. obviously a market moving piece of information. what. does elliott want honeywell to do? >> basically to break the company in two. honeywell aerospace and honeywell automation which is everything else that is not aerospace. it is a thesis very possible from activists to industrial conglomerate which honeywell is one of the last. it is a story about streamlining suffocation's and unlocking values like the higher value assets such as aerospace. matt: because honeywell has not had great performance. . i read on your story the stock is only up 25% over five years. the industrials index is up 75% and the s&p is more than couple -- more than double paired crystal: if you look at their

peers, ge famously did a breakup in three ways. you have dupont that broke itself up in many pieces. it is a popular thesis within industrials and should not come as a surprise to management or any investors. matt:matt: they have done a spinoff of advanced materials. are they likely to be receptive to elliott? crystal: the spinoff was announced last month. we have not heard whether the company is engaging with the company. based on the statement this morning, they were notified of elliott's presidents today. there will be a lot of work between elliott and honeywell. what we will know is this is not a surprise to most of the investor space given how this thesis has played out over and over again amongst different conglomerates. matt: it has been the way the pendulum is swinging for now. crystal from the deals team. we are looking at a market that is near all-time highs but giving back some of its gains.

we were up over 6000 on the s&p yesterday. you can see the 10 year yield at 443. that does it for bloomberg markets. i'm matt miller. this is bloomberg. ♪ it's our son, he is always up in our business. it's the verizon 5g home internet i got us. oh... he used to be a competitive gamer but with the higher lag, he can't keep up with his squad. so now we're his “squad”. what are kevin's plans for the fall? he's going to college. out of state, yeah. -yeah in the fall. change of plans, i've decided to stay local. oh excellent! oh that's great! why would i ever leave this? -aw! we will do anything to get him gaming again. you and kevin need to fix this internet situation. heard my name! i swear to god, kevin! -we told you to wait in the car. everyone in my old squad has xfinity. less lag, better gaming! i'm gonna need to charge you for three people.

>> from the world of politics to the world of business, this is balance of power.

live from washington, d.c. joe: trump 2.0 begins to take shape. welcome to the festa show in politics is more jobs are filled in the next trump administration as the lame-duck session begins in congress. we are back in washington. glad you are with us here on the tuesday edition of balance of power. tomorrow is going to be something. donald trump will be back in town only to meet with joe biden i the oval office but he is going to the hill as well. kailey: going to be meeting with house republicans assuming the republicans are likely to retain the majority. first he will talk with lawmakers, game plan for what happens when the 119th congress begins before he heads to the white house on his own. no melania trump with him for this meeting. joe: the optics are going to be something. i'm assuming they sit down and do