Cathie Wood - Truly disruptive innovation started declining in February of 21, while the market soared to all time highs and 21. And now the rest of the market is, is suffering as well. So vaccine, people going back to work, supply shock, there's the businesses had shut down wondering if they would ever reopen their doors, right. The shutdown, at the same time governments around the world were stimulating aggressively. So we had a supply shock, especially because demand actually was so much stronger than anyone expected. It's learned. Could I have dreamed a technology investor that supply chain issues would have lasted more than two years? No, I never thought that for a second. I thought we would be over that in in a year, and certainly couldn't have predicted Russia's invasion of Ukraine. So the question is, is this 70 style inflation, which is how the markets are treating it right now, and why our strategy has been decimated? And most growth strategies have been hurt very hard. We don't think it is. I think the markets pricing is pricing innovation, as though we have a bad inflation problem that's going to take interest rates up even higher. We don't think so. We think actually, the greater risk and opportunity is deflation. I think we're going to start seeing deflation on a month to month basis. We're already seeing commodity prices come down. They've broken down many of them. That's the That's upstream at the top of the pipeline at the bottom of the pipeline around the world. We're seeing a massive inventory overhang. As we're heading into the holiday season, how will they clear that discounts? So I think cyclically, we're going to see deflation, we're already seeing it in the pipeline. secularly we will also see deflation. It's we spend all of our research time focused on disruptive innovation, technologically enabled disruptive innovation that is inherently deflationary. But that's good deflation, because as prices for electric vehicles continue to come down, we will see a continued boom in electric vehicles, it will hurt the internal combustion engine cars, but it will help the innovators.

So I think we're going into a deflationary period, much like much like the late 19 teens, so 1918 World War One ended, Spanish flu also hit so think about that war, flu, very similar dynamic, right. And the other similar dynamic was three major innovation platforms that were going to transform the world, telephone, electricity, and automobile, they were all scaling exponentially, and took us into the roaring 20s. So supply shocks took inflation back then to 15%. But within a year and a half, two years, they saw that inflation started dropping and it ended down I'm sorry, the inflation was 12%. The ended down deflation 15% Roaring 20s I'd like to think that's what we're going into now. And there's a high probability we are okay, so that's the deflation call. So you're also making the call that growth has bottomed now that this is the opportunity to get greater exposure to growth that we are seeing the bottom now in terms of the sell off the tech. So it's interesting to watch our strategy as fears about fed tightening and more fed tightening continue. Our on many days when the markets down, our strategies are up. Now that is what tends to happen. I'm not promising This is where we are my compliance department wouldn't ever let that happen. But in the later stages of a bear market, our strategy starts to outperform even even, it may just be that we're down less than the market. Some days were up when the markets down. Why? Because during the later stages of a bear market, the new leadership shows up and starts performing were the new leadership we always are. And many people think, Oh, I've got myself covered with the NASDAQ NASDAQ 100. No Look deeply into those indices. We are the new NASDAQ. And most of our stocks are not in those indexes. We haven't owned the fangs in our flagship for quite some time. That's not the new new anymore. Tick tock has come along and destroyed a lot of a lot of models. So yes, I think that we're seeing the early stages of a bottoming process. At the same time, many people are saying we're going into a recession. Now we think we've been in a recession. And that that the negative numbers will reassert themselves after this positive third quarter, mostly because of the inventory overhang. And we need to clear that out. I think many forecasters may say, Oh, this is gonna last forever this recession through, we think is just a major inventory correction. And then we'll be on our way again. So a short lead recession is what you're forecasting? Well, we start with believe it started at the beginning of this year.

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