Welcome. We get some insight into how the credit markets will perform with paulg to start lampert. Me now. With su, investors i know pulling perts fund lamperts fund. Anythingspinoff change for him . Theres a couple of things going on here. We can get to the money being pulled. Redemptions with submitted a year ago. Newshe spinoff very big today and impacts investors going forward. The funds main investment, has started to struggle as lands end remains here. , is the theme the spinoff is subject to approval by the board according to a filing today and would allow investors to not only share in more profit but separate a strong band, analysts say, from sears now struggling image. Of course, sears suffered 27 straight Quarterly Sales declines. Analysts say, again, its a good thing for investors and because end byds end has been weakened association with shares and could do better down the road. That is despite the fact that own struggle. Its its income has dropped some 63 hase 2008 and its revenue fallen about 4. 2 . So the bigger story here is a for retail. Nment as for these redemptions, people close to the matter say it has everything to do with the fiveyear redemption or lockout theod and could be a bet on retailer going forward. And whats happening there, subject . Re on the well, most of all of this this 3. 5 billion being pulled from the fund relates to capital efforts raised by Goldman Sachs in 2008 when both the fund and sears, for that matter, were cylinders. Goldman raised roughl roughly 3. 4 billion as new esl partners. The fund requires investors to keep their money invested for years, an unusually long lockup. According to our source, these theytors signal that intended to redeem under terms of the fund according to the source, esl has a full year to pay out the money. And thats whats happening here. Large unusual, it was a chunk of change that went in five years ago. It is now a very large change coming out. The fund had about has about about 5 billion. Thank you very much. Well, speaking of hedge funds as a group, theyre headed for performanceannual if you compare to the u. S. Stock Market Performance since 2005. November hedge funds returned 7 . But if you compare that to the yeartodate return, obviously less. Hedge funds are going to be about 50 billion in Management Fees this year. And when asked about under performing stocks in general, managers citing a few reasons the fed Stimulus Program record low Interest Rates and declining trading volumes. The hedgeg to stay on fund scene because the trustee firee San Jose Police and plan. The richest municipality in the u. S. Also leading the country in reform. The pension as money is shifted into hedge funds. Heres why. Is a very challenging aspect for a pension because a pension you have to have a fiduciary that signed on the line for these recommendations. So youre using a consultant. Consultant generally to other pensions. Theyre all big, write big tickets. So you are generally finding towards very large funds. So the big funds are getting bigger. Much bigger. Mediumsized hedge funds deserving of the capital arent getting it. Yeah. Very hard time getting passed that consultant layer. Tried to be as proactive as we can in trying to push that we want smaller funds, up with a lot of large funds. So we have two pension plans, ones 2 billion, one 3 billion. Roughly inllion hedge funds. Then about another 100 million sox. More or less more or less forced to work with the bigger hedge funds. Lower on fees . M so, thats a real hotbutton issue right now. Of inquiries a lot from all over, members of these that, sponsors, from media wants to say, hey, you know, youre putting a lot of money highfee funds. Youre going from a 40 basis to now two and 20. We find that we can negotiate in some cases. The best when were able to is whenbest leverage the consultant will say, hey, we got 10 pensions that will be putting in, 500 million into your fund. Pass on breaks can you to these clients . Because 10 times 500 is not bad for that hedge fund. Is sticky money, money that a lot of friction. Investor. Eal this is permanent capital. Or about as permanent as you can get. Dating relationship. Its a marriage. Theres tremendous due diligence. Once a fund is select the, you are in for at least three years, five years. Interview with sean bill, trustee of the San Jose Police and fire retirement plan, leading the countrys reformulater in the hour hour. Reform later in the hour. Meantime, tommy settled with u. S. Regulators and is now banned from the securities industry. Orderedc. Commission them to pay. Frauding. Charged with investors in two hedge funds. John thomas also facing allegations of penny stock fraud industryfinancial regulatory authority, the new yorkbased firm reaped more th in commissionson over its sixyear history before. Losing in july we turn the page away from hedge funds back to macro issues. Were going to get you down to d. C. Because budget notions working through the weekend, deal to avoid a new government shutdown. Avoiding tough issues but even a narrow agreement looks very unlikely. Youre chief washington cook with me peter me. Whats likely to happen this weekend . Be closer to a deal than first appeared. Im told that paul ryan and murray, the two negotiators for that house and senate respectively are on a path way to a deal. Still remaines over the details. Progress is being made is the last word i got. Bigger question is to whatever agreement they might be ite to come up with, can pass muster with their colleagues in the house and senate . Thats an open question. The two are going to be at it weekend communicating with their staffs, working directly in washington trying to resolve some of the differences between them. Deadline is next friday, december 13. But the real deadline they face is january 15. The government, once again, runs out of money. The key components of the deal theyre looking at, it would set spending levels for one or two years for the federal government. Theyre preferring two years it would replace those automatic spending cuts, the sequestration through a mix of savings and some newas and revenue. But it would noint involve any any new taxnvolve increases or title reforms. They are avoiding some of those flash points in order to reach a deal, even a smaller deal but even that proving to be a challenge. Its not a done deal yet. What are the main stumbling blocks . Issue is if you dont use taxes and you dont dos with entitlements, how replace those sequester cuts . Lots of ideas on the table, but each has its own issues, critics. Some of the ideas, for example, Aviation Security fee for passengers every time they get plane. Airlines dont like that. Passengers dont either. Some lawmakers call it a tax. Aftere trying to go federal, woulders, make them contribute more to their retirement plans. Withdoesnt sit well democrats. Democrats also hoping to extend emergency unemployment benefits. More time they want that part of the mix. Republicans dont like that idea. They think the emergency benefits should be canceled at this it point. John boehner hasnt closed the door completely on the issue, but its one of the stumbling blocks. And after the report, deirdre, sell. Ld be a tougher what if theres no deal . Whats plan b . Both sides are saying we want to avoid anything we can to not have a government shutdown. John boehner has said that there would be at a minimum, by the lawmakers leave for the holidays on friday, at least a temporary spending measure that would kick this can down maybe march. Nobody likes that idea, but it is better than the alternative. Again, thats a shipdown shutdown threat hanging over the the newperiod into year. Thats plan b at a minimum, but even that has potholes as well. Always, our chief washington correspondent peter cook. When we come back, a Credit Fund Manager with 9 billion in assets under management tells us how she sees investing environment next year. And saving an ancient city art. Gh we will tell you what Pablo Picassos grandson is doing to was once partich of the alexander the great empire. We are back in a few minutes. Welcome back to money moves on Bloomberg Television and on yourg all day long tablet, phone, and bloomberg. Com. Some argue the fed will reduce this month sooner than previously thought. Credit specialists just one paying extra close attention. Credit Hedge Fund Manager recently shared her insights as the environment. She wrote a book as well, investing in credit hedge funds oz. As she says, everyone is exposed to credits whether they realize not. The most interesting for me is the fact that the credit evolve. Ontinues to and sitting on the seat, you know, on the front row managing actual portfolio for Institutional Investors when i look at where we were coming out of the credit crisis up to today, its amazing the speed with which the market has evolved and also the expense of the fed intervention since then. Thend i know that one of reasons that you actually wanted to work on the book is because you were the one who pointed out it or not, ifow it youre in a pension, if you somea 401k, chances are at level you are exposed to the credit market. Absolutely. You have a lot of exposure to credit market and a lot more people also have exposure to hedge funds through, for their 401k. So, you know, whether you like it or not and the risk of rate rising is here. And its here with us whether you like it or not. The new look ahead to year, if it theres one thing to keep in this mind for credit it . Stors, what is so continued search for yield. Investors will have to continue juggle two seemingly contradictory goals which is to the on generating for portfolio and the other is to manage their Interest Rate risk. The bestw do you see ways to do that . There are few opportunities in the market that i think investors should focus on. One is in order to reduce their duration rate risk is to rotate away from Long Duration assets duration or short floating rate assets. And a lot of people are example, about, for but what about potentially theres a bubble in the credit market . Strong. Amentals remain so in order to invest, its possible that well see credits spread stay where they are right now. But in order to generate additional yield for the portfolio, there is currently a credit markethe where most of the money has gone to the biggest and the most creating thes, haves and the havenotes in credit. So if you are the kind of investorinvestor who can do youe work and look at smaller that have been somewhat neglected and sort of unloved, you can generate additional for your portfolio. So it sounds like youre saying that the credit market is tessly overheat not necessarily overheated as long as you know where to look. Exactly. Saying its cheap, but there are pockets of opportunities. And tainly the smaller offering attractive relative opportunities at the moment. Corporate, forin example still manageable . Still manageable. As measured by, for net debt is still in reasonable amounts. Also, the interest cover which issuers ability to manage debt. Geographies go, we know there have been distressed debt teams on the ground in europe forthe past two or three and not able to do too much, but theres a lot of people saying that is going to begin to shift what is your take . We are starting to see the opportunities shifting in europe. Waited, asors have you alluded to. And i think two to three years expected that to come. So theres nothing to do and theres a lot to do and then of it tapered out, which is what happened in the u. S. Consideringeurope, how culturally things are different and the reliance on market, wending expect this to be a gentler slope and a gentler slope. Gentle slope down. So this means that the opportunity is starting to heat up. Of asset sales now coming out of bad banks. And the opportunity will be with us for some time because sourcing is key. And european banks themselves to deal witherage so they are going to have to sell some assets. Yes. Exactly. One thing that the Investor Community has learned from slightly and this is counterinteintuitive, is the fat that banks dont sell when they need to, banks sell when they can. And in the depth of the crisis they couldnt afford the markdown. So right now as things start to the both fundamentally and e. C. B. Also has commitment has voiced a commitment to sector ine financial europe, they are able to slowly work out some of these bad sheets. Ff their balance the question is, whats the . Mount we think where it is right now, potentially returns in the mid teens, pretty conservative assumption. Thats pretty good. Theres not much else out there. Is there anything to monitor asia . Ticular in currently asia is sort of a steady eddy right now. Thatnow, one of the things we continue to monitor is just the health of the real estate asia, particularly in relation to chinese real estate. And one thing that the chinese come outt has recently is that it has joined the Global Quantitative of easing. They dont call it that, but generally the tone from the has been veryment doveish. And in asia, whether you have directly to china or indirect exposure to china, when china sneezes, everybodys impacted. Its one thing were watching. Pasquali, 9 billion in assets under management. When we come back, the c. E. O. Of realtime marketing platform called shift. Some of the clients include verizon,express, unilever, walmart. List. Long find out what they want most from the c. E. O. , with us next. Imagine the possibilities. Good advice for and a half gating through life directly investing and the very essence of options trading. Brokers. Ve i tell you a practical way of thinking about options without complicateds mathematics. A few of the clients on a platform called shift. Borrow with me. Shift is a realtime marketing platform. Brands,ave ad agencies, vendors, all working together. And the idea here, to execute time. In real so how are you changing the way that all of these groups Work Together . So with shift were Building Software that allows all of these stakeholders to Work Together. Differents really because its a crossorganization its across organizations. Tyingcial is about together the content and the media buyers. Iswhat were doing facilitating those connections and sharing data across these organizations. Result is they can get much better performance across facebook, twitter and linkedin. Facebook has almost 2 billion believe theirou data, twitter the few hundred millions. What kind of opportunity is that you . Its a massive opportunity. These platforms are really the way that you can reach people across any device. So you look at facebook almost a way for, there was no advertisers to reach out mobile. Now thats a multibillion dollar business. This is a huge opportunity to reach people wherever they are. And this is great because it while theyrebe on their tablets, on their phones, their laptops. We have think longterm it will while theyre watching television, as well. We think its changing the way that you can interact with these mechanisms. What, james, do your clients you . Most from i think they want to see how sales. Es instore the beauty of social is you can tie together online and offline. And thats something that hasnt past. D in the so i think for advertisers right now, theyre trying to see how this noise interaction online is actually lead being to real sales leading to real sales, whether its american veeriz verizon or even unilever. Obviously its a great idea, youre not alone in doing it. How are you protecting and increasing,owing, your competitive advantage . Yes, so our big advantage is breakhelping these brands down these silos. Traditionally our competitors are focused on giving software that just help internal groups. What we decided is that the best is for all the stakeholders to be able to Work Together no matter what. People workping across continents, across organizations to make sure that everyone is aligned to deliver possible results. And by doing that, weve been able to really do a lot of damage against our competitors. Now we are a Small Company going up against a lot of big fish. We think thats really our big, competitive advantage. Thanks very much for the time. James borow. Thank you so much. Cofounder and c. E. O. Of shift. Past the hour. S that means it is time for bloomberg on the markets. Oure going to get you to newsroom. Onie will have the latest trades. Were seeing a rally today after five down days for the market. That jobs report better than estimated this morning with enough to give stocks a boost. And a big one at that. Trading higher by 20 points. The dow gaining about 186. The nasdaq up by about 32 on the back of these numbers. Stocklooks like that investors are happy for growth here, even if it does mean that Federal Reserve will be tapering. Back in 30 minutes with more on the markets. This is money moves where we focus on innovatival alternative investments. We want to get you caught up on our Bloomberg Top headlines. Unemployment rate dropped in november. It is now down to 7 compared to october. U. S. Pay rolls rose by 203,000. Wasgain in u. S. Employment the biggest in three months. An ice storm hitting the southern part of the u. S. Is power lines and of flights. Ousands flights across the country canceled. Utility companies are getting ondy with crews to work anticipated power losses from texas to arkansas. President th African Nelson Mandela will be buried on december 15 in his rural home of nationter a period yallal mourning. National mourning. His body will lie in state at governments executive headquarters in south africas capital, victoria. Died yesterday at the age of 96. He had been ill for about a the hospitalout of to treat a lung infection. Focusingmore locally, on detroit, a federal judge has approved detroits bankruptcy filing. Says pensioners may be taking a haircut along with other creditors, but as to how this will affect investors, we bring in bob rice from Tangent Capital Partners to explain. We know there are two types of inys that people can invest general Obligation Bonds, Revenue Bonds. Right. How is this going to shake out . A couple of points here. One is that the Revenue Bonds are secured by collateral. Have a nice little graphic we can show how this breaks down for you here. Yup. Go. Here we so youll see here, here are the key differences between g. O. s and Revenue Bonds. General Obligation Bonds are backed by the full taxing power the municipality whereas Revenue Bonds are only backed by specific assets and revenues. Generally speaking in typical environments in that thatd row there, we see they have theyre considered safer and therefore have lower yields whereas Revenue Bonds are riskier and have higher yield. But, but, the key thing that on thatteaches us is third line. However, in a bankruptcy situation the general Obligation Bonds are Unsecured Creditors so theyre subject to a haircut the like we now see pensioners are subject to a haircut in detroit. Whereas the Revenue Bonds are collateralized by specific assets or revenue areams and, therefore, secure and therefore have more protection in bankruptcy than that people bonds typically think of as safer. So are there broader implications . We take anything, extrapolate anything, from the detroit situation to the general hewny bond market . Yes. I think you can. One of the things is if youre going to invest in municipalities that look a little bit riskier, you might want to gravitate to the Revenue Bonds so you will have are looking atou municipalities that will have incentive. Especially post detroit to file, because they think theyre going to restructure their pension plans, their unfunded pension plans. Again, Revenue Bonds may be safer. Is thatthird point because Revenue Bonds typically do carry higher Interest RatesObligation Bonds, there are going to be more theyre going to be more protected against Interest Rate risk than regular g. O. Bonds are. Which is all the more sal today. We have the jobs report. You have people say being maybe the fed is actually going to to taper this year, which is a lot sooner than march. Exactly. And whats really important todays jobs number isnt just that the number went down the 7. 3 to 7, its that Labor Participation rate went up. And that hasnt been happening. Up onfewer people giving finding jobs. Right. Exactly. A that is very thats nondeflationary indication. That yourens likely to look more at infacingry periods periods, rising Interest Rates, and therefore, munis inherently with higher Interest Rates will be more protective in that environment. And detroit still must prove vent. Ts insell right . This is the sort of Bigger Picture for a municipality for a bankruptcy. Right. Its not alley alley oxen alialioxenfree. But it is a fair point that there will be more incentive as ruling, of that detroit that, indeed, pensioners can. Lso be subject to haircuts for municipalities to consider that, because a lot of them lyally do have profound underfunded plans and dont know what to do about it. It seems like hitting a brick numerous cities across the country. Thank you, as always. From Tangent Capital Partners with the latest on the situation in detroit and its implications for the hew muni market. Picassoead, the ainting that could be yours for for 135. Not a typo. Pablo picassos grandson telling back. When we come welcome back to money moves on Bloomberg Television and streaming all day long on your tablet, phone, and at bloomberg. Com. We were just speaking about detroit and the implications for muni market and after the bankruptcy filing. Sean bill is the trustee of the fireof San Jose Police and retirement program. San jose with the Silicon Valley pull is the richest municipality the u. S. And its leading the country in pension reform. Rulest, it may change the for the rest of the country. Statecalifornia, the constitution mandates that half the board be represented by half thef the plan and board be represented by the. Ponsor san jose is the first plan in california to say the sponsors will betatives independent citizens of the community. So if you look at the josesition of the san board, a majority of the board, actually by one, comes from background. Generally speaking with the Financial Experience either in the hedge funds san jose is the richest municipality in the whole country, right . Basically its Silicon Valley totally. Country. Ncome in the budgets about just unde under 900 million. Pension costs have gone from about 50 million t to 250 million over the last 10 years, taking up roughly just budget,quarter of the lets call it. So whats happened is that has crowd out services in other areas. So you had policemen, fire, opened,fired, parks not libraries not open. Yeah. 10 salary cuts twice. Libraries had been built by developers that we didnt have the money to staff them. That led to the mayor and the city council saying we need to toto the voters and we need change some of the rules in terms of the benefits for the forward. Going which is essentially what detroit is going through. Correct. So its pretty sticky, im sure, as far as discussions go because theres a lot of at least from iewn yonsz and im unions and im sure numerous other parties. Is, howe real mission do preserve the benefit without bankrupting the sponsor . What san jose has done is said, ok, you cant work for 30 years and then be refired for 40. To work, you know, a little longer. Increased. Has been beenhe benefit has reduced. So its not 3 at 50 per year of 2. 5 . E, its now and by having employees work longer and draw from the funds shorter period and by reducing the percentage, youre able to get the numbers back balance. And to be fair, what youve been working on with san jose is that basically the people who under the old system are more or less grandfathered in. This is for new City Employees forward. Will. Well, all employees are grandfathered in. Any benefit that theyve earned. Going forward the benefit can existingven for employees. And thats a big difference from some other pension reform seen. Es that youve for example, governor browns thesenitiative made changes just for employees that are new, that are coming in new. O the systems so san jose, thats a very big difference. Existing employee has vested all their benefits on a backwards looking basis. But going forward, those benefits may be changed. Moving from your sunny weather pattern up north, canada is actually a country a lot of things right as far as pensions go, including, quite frankly, paying yourself. H as because youre paid like a Public Sector worker even though you have a huge responsibility. Yeah. Will that change . Are you try fog pioneer that change trying to pioneer that change as well . One of the things weve looked at is weve hired a consultant. We asked, how do we improve the governance of our system . Because canada does have best systems. The canadian boards are composed independents with some representatives from the plan. So what their recommendation is have a board with about 75 of the board is composed of independent representatives. Half would be selected by the sponsor. Half would be selected by the members. The members can use half of allocation, have a member sitting in that seat so they would have a quarter of the the otherhen for quarter they would have to find an outside, independent qualified financial professional. Sean bill, trustee of the city of San Jose Police and fire plan. Ment from munis to fine art, a valued atinting 1 million could be yours for just 135. Grandson, olivier picasso, is raffling off the work to benefit the president racing of an ancient city in lebanon. Bloombergs julie hyman reports. Ideathought it was a good to promote and to help the city bytion to save the offering for the First Time Ever a painting. Painting, a drawing from my grandfather, pablo in new york. Y 100nd the tickets only cost euros. Youre selling 50,000 of them, the cap on how many tickets youll be selling. Is this drawing actually worth . Today on the market its a 1 million artwork. What is your relationship with the international to save the city . What is your interest in helping cause . Rticular a good friend of mine nor a tvg time in france, a producer when she came up with the idea to organize not the Charity Dinner as usual but to raverle and to ravel and to offer people the opportunity to win a picasso artwork, i was suspicious. I was thinking, maybe. Biggest problem would be to find the right artwork. And when she came back a few this beautifulh wast on paper, i thought it a great, great choice. This is a Museum Quality artwo artwork. Its also the cubism of my grandfather. Second phase about cubism, which is here on the canvas. It was a good choice. The familyome from selection . In fact, my grandfather kept life. Rtwork all his my grandfather kept a lot of artworks. A was for him a mission, humanityo leave to the proof of his talent. Death this was part of the picasso estate. And then it was sold by one of our members to a big gallery. So now its the gallery that offering it up . , a loan forhe city the acquisition of the artwork a donor. Guarantee of its really aver certified operation with all the the yougiven by know, a raffle is a monopoly. You need authorization from the government, from the minister of finance, minister of culture, and everything has been really, way. Y done in the best do think that there will be more raffles either of your artwork or do you think that this could set a precedent for other types of raffles . Besides the complexity to raffle, i would say it would be quite funny and exciting that instead of getting to get anheck, artwork. Hope this will be an example the drawing of picassos the man with the opera hat will place december 18 at sothebys in paris. When we come back, really personalized gift cards. The cofounders of giftbar will here. They started in chicago, new york. Theyre expanding nationally. Well tell you how local highend stores are connecting with shoppers even in different cities. Bringing a local luxury feel to gift cards. Jennifer morris are the cofounders of gift bar. They started in chicago, now in york, expanding nationally. Sales of gift cards topped topped 110 billion last year, but many say, well, theyre still impersonal. Toguests are frying change trying to change the look and feel of that. Welcome. Thank you. Thanks for having us. The idea . Was how did you get started . Ill start with you. So the idea was really to gift cards to independent retailers easer easier. The personal experience of trying to buy a gift card. Wasnt easy to come by and aalized there had to be better way. If you look at the gift card malls that exist, they are ly big box gift cards. There are, despite how easy get everything everywhere, there still are some local boutiques which have offerings. So, jennifer, how did you decide that this was a need that the marketplace you could meet the marketplace and make money . Yeah. We spent a lots of time doing a concept for about a year and a half. And we interviewed both merchants and consumers. Overwhelmingly the merchants i was going to say the merchants must have said this is a godsend. Kind of the audience we were going after the affluent consumer was saying i want box,hing better than a big something more personal. What we learned through that experience also was that they wanted to be able to upload photos, send unique messages. Thats what we kind of took the component allowed us do that. So what is the sales motto . How do make money . Us a fee toants pay be on the platform. Then we take a percentage of all gift cards sold. Kinds ofen what boutiques do you find are most willing to work with you . Is there a range . I imagine clothing, curated gifts. Right . We actually get a wide of different merchants which has been nice. If it you look at the categories home, our website, its beauty, you know, womens clothing, mens clothing, accessories. You just did a recent fundraise. What are you doing with the money . Round ofsed our first funding in august of last year. We are currently raising our next round of funding. Are now soon to be in seven markets across the country, we plan on expanding our reach. To open in other cities as well as Digging Deeper markets. Isting as far as the way the word is social . G, is it more how are you finding that the word is getting out . A combination of the two things. Our merchants have spent a lot of time let being their consumers know, too. Our merchant into relationships, theyre a Distribution Channel as well. Much. Nk you very cofounders of gift bar. We have a very quick break to take. After were back, a full update on trade. Stocks are higher across the board. After that jobs report this morning. For more on the markets we get you out to the newsroom. Our senior markets correspondent julie hyman is there with 56 past the hour. Everything you need to know on trade. What are you seeing . Recouping almost all of the losses that they had seen in the prior fivesession 500. G streak for the s p its now up about 1. 1 . As you said on the back of that strongerthanestimated jobs report. If it you look at the treasury can see some of the fallout there with yields moving higher. Not a huge move higher but a move higher nonetheless. Because, of course, when you get this economic data, it feeds fed willnto what the do next in terms of tapering its stimulus. Ted and many investors, because they are bracing themselves for gettingates, have been into a type of mutual fund, i in fixed income thats a little bit different. Its been a growing area. Unconstrained or nontraditional bond funds. According to morning star, pulled 65 billion from intermediate term bond through the year ended october 31 and deposite deposited 48 billion into these types of nontraditional strategies. If you remember yesterday, i had the chance to speak with the ceo of western asset management, one of the countrys Largest Bond Fund managers. He talked about the appeal of type of strategy in rising rate environments. If you look at the most itsnly used bond index, got a duration just over five years. Its only got a yield of about 2. 3 . So when you look at that in2ke678 index and the growth treasury component of it, which is the most Interest Rate sensitive part of that index, people just dont believe for thegetting paid amount of Interest Rate risks that theyre taking. So these new unconstrained types when they come under many different monikers, have been very popular where can go short in the index, in terms of duration, you can get negative duration, and sectors that you like, you can take a much more aggressive position in the like. S that you you dont have to worry about being tied to the benchmark as a reference point. Hishman like many fixed income investors says you want those treasuries with to that move expected continue once the fed does taper its stimulus. Here are the other areas he talks about as appealing for those unconstrained bond fund managers. That like the areas provide yield enhancement and will enable us to buffer a weing rate environment if see one. Fair values. High yield. Short duration high yield is not us. Lar area for probably one of our most popular investments at the moment where get 85 of the yield of the high yield index with about half the duration. Mortgages we think are particularly attractive underhere, right now, valued a lot of room to run. Until the case of many westerns products they have outperformed the market. Take a look the western asset total return unconstrained fund. Can see for the yeartodate it is down slightly. Ofever, thats beating 92 its peers over the fiveyear term. About 94h4 of its terms 94 of its peers. Universal. Been for example, just yesterday we learned that pimcos manager of unconstrained or its main unconstrained fund, i should say, was stepping aside for a sabbatical. Head of the firm is taking over temporarily. So well be watching the growth in those types of funds to see how they perform versus the world. Fixed income well be on the markets once again in 30 minutes time. Next. Is street smart is next. The schizophrenic market is back. A solid jobs report triggers a market surge after five days of decline. Well explain when good means good and when good means bad. Ecommerce the pioneer, is now going brickandmortar. We used to think in terms of either youre chopping digitally or youre shopping in a store. Mobile technology is enabling is that line to blur. C. E. O. E talking to the about the companys big investment in hightech. Torefronts then, for the final day of bubble week, were looking at biggest bubblehe of all,