00:47:11 · Jordi Hays, John Coogan
[00:47:11] S1: Modine Manufacturing. [00:47:13] S0: Okay. I I'd be interested to know what he's thinking about in the in the energy side on the the gas turbine side. Right? Isn't that what semi analysis was drawing the most attention to? Feels like they've been very ahead of the curve on identifying Yeah. Companies that are basically already supply constrained. And if you just look and if you look deeper into what's going on in their book of business Yep. They're about to flip to incredibly high margins. Because once once everything goes out of stock, this company can just all of a sudden say, yeah. Actually act actually, we need 60% margins. People will be like, yeah. No problem. Like, you're the [00:47:56] S1: I I want to buy as much [00:47:57] S0: as possible. [00:47:57] S1: Yeah. So the story from situational awareness is like all the neo clouds have sold off a ton Yeah. Where we've [00:48:03] S0: Situation room here. Hiring. Saying Satya unloaded his risk onto the neo clouds. It's a game of sort of, I don't know, musical chairs. Yeah. And so that's Yeah. [00:48:14] S1: Like the deal with the deal with Microsoft [00:48:17] S0: Yeah. [00:48:18] S1: Just wasn't it like seemed to be like little to no margin. [00:48:23] S0: Yeah. [00:48:24] S1: But anyway, so if you so the Neo Clouds have also sold off, but Lumentum Holdings is up 46% in the past month, which he added. Western Digital up 25% and Seagate up 14%. So Yeah. He's making up for it.
00:48:24 · Jordi Hays, John Coogan, Stacy Rasgon
[00:48:24] S1: But anyway, so if you so the Neo Clouds have also sold off, but Lumentum Holdings is up 46% in the past month, which he added. Western Digital up 25% and Seagate up 14%. So Yeah. He's making up for it. [00:48:40] S0: Yeah. Yeah. It's it's the birth of a new of a new bond. It's just like it's it's the very, very hot part of the cycle. I think everyone's wondering, like, how big will this be in a decade? That's a that's a big question. It's a it's it's a very exciting time and but you gotta stick the landing. And I think people are I'm sort of rooting for him. I think he's I think he's gonna do it. [00:49:05] S1: Yeah. The question is like, are like, is it gonna be a true hedge fund? Like, he gonna make money [00:49:11] S0: In a down market? [00:49:12] S1: In a a in [00:49:13] S6: a correction. [00:49:15] S0: I mean, yeah. I bet we're gonna open up one of these 13 f's and be like, wow. He's short everything now. Okay. And then and then you're see everything sell off, and it'll be like, wow. Another That [00:49:25] S1: would be much higher signal than PT in a in a, you know, $75,000,000 fund.
00:49:31 · John Coogan
[00:49:31] S0: Oh, totally. Totally. Yeah. Yeah. Yeah. There there there's some Blue Owl news in the Financial Times. Blue Owl investors faced hefty faced hefty losses as credit fund blocks exit ahead of merger. Blue Owl has blocked redemptions in one of its earliest private credit funds as it merges with a larger vehicle overseen by the asset manager in a deal that could leave investors with large losses. They could lose about 20% of their holdings. The deal underscores the risk that retail investors have taken in pouring hundreds of billions of dollars into private debt funds carrying limited liquidity rights. It comes as scrutiny builds on the valuations and returns on private credit funds, which have caused publicly listed debt funds to sell off and trade at steep discounts to the stated value of their assets. And so we we we talked about this, I think, on Friday, but Blue Owl has been selling off this year, and they said we should be performing better than everyone else. But it feels like a little bit of the narrative might be around liquidity here. Earlier this month, Blue Owl told its shareholders that it planned to merge Blue Owl Capital Corporation two fund, which has a billion dollars in assets, with its OBDC fund, which has 17,000,000,000 in assets. BOCC two investors are being asked to exchange their shares in the private share private fund for shares in OBDC at the stated net asset value of both funds. However, OBDC trades on public markets at a discount of about 20% to the stated value of assets because of the liquidity problem.
00:51:04 · Jordi Hays, John Coogan
[00:51:04] S1: Well and because it's possible that [00:51:07] S0: the People [00:51:07] S1: are it doesn't feel like they're pricing the assets correctly. [00:51:10] S0: Potentially. [00:51:11] S1: There's some discount.
00:51:11 · Jordi Hays, John Coogan
[00:51:11] S1: There's some discount. [00:51:11] S0: Gotta see what's in there. Redemptions in BOTC BOCC two have climbed to a level where it could event where it would eventually be forced to restrict investor redemptions. Its investors pulled out a 150,000,000 in the first nine months of this year, a 20% increase from the same period last year according to security filings. Redemptions in the third quarter nearly doubled to 60,000,000 or 6% of its net net asset value. Jonathan Lamb, chief financial officer of OBDC, acknowledged that at current prices, investors could take a potential haircut on their investments, but he said the merger came with significant benefits, such as the ability to own more liquid shares in OBDC. The trading price of OBDC has been hit by souring sentiment on private credit markets that was not backed up by the performance of Blue Owl's underlying loans, he added. If shareholders were to vote down the deal, BOCC too may be forced to limit redemptions. So good luck if you're hanging out in Blue Owl Capital. Sundar Pichai has more news in the data center world. She says, today, we're announcing a new $40,000,000,000 investment in Texas through 2027 to build cloud and AI infrastructure and support thousands of new jobs. Yeehaw. This includes new data centers in Armstrong and Haskell Counties and a major investment to strengthen energy resilience and abundance. We're also providing funding to more than double the projected pipeline of new Texan electricians [00:52:44] S1: There we go. [00:52:44] S0: To power the AI era. With the
00:52:44 · John Coogan, Jordi Hays, Healey Cypher
[00:52:44] S0: To power the AI era. With the [00:52:46] S1: golden age of being, the golden electrician age where you [00:52:51] S0: get blown around in [00:52:52] S1: private jets to different data centers. [00:52:54] S0: Yeah. You do. You do. That's right. So $40,000,000,000 investment, thousands of new jobs. That feels like a higher ratio than what what was the other example you kept quoting? Something like 500 jobs for some anthropic Yeah. [00:53:07] S1: It was [00:53:07] S0: data center or something? [00:53:08] S1: It was the anthropic data center. They were like, we're investing $50,000,000,000 How many jobs did you create? [00:53:13] S0: Twenty twenty jobs. It was I mean, that's not like goal of this stuff. 800. The jobs should not necessarily be created in the data center. [00:53:19] S3: No. I [00:53:19] S1: I I just brought I I just always brought that up because you have to understand what people outside of tech, their reaction Totally. To Oh, great. You're investing $50,000,000,000 yeah. In some cases, this doesn't create jobs. A good article in the journal on on BlueOut as well. I think it also ties into Abilene, Texas. Yeah. Might might be a good moment to to cover some of this. Yeah. Pull it up. In the journal yesterday, Wall Street blows past bubble worries. Oh, yeah. It's a supercharged AI spending frenzy. And they say firms such as Blue Owl Capital have raised trillions in investing firepower. The AI build out is a perfect match. The warning signs are flashing. Not long ago