June 30, 2025 • 18 mins
Watch Paul LIVE every day on YouTube: http://bit.ly/3vTiACF.
Bloomberg Intelligence hosted by Paul Sweeney and Norah Mulinda
-Anurag Rana, Bloomberg Intelligence Technology Analyst, discusses Oracle signing a single cloud deal worth $30 billion in annual revenue — more than the current size of its entire cloud infrastructure business. That revenue is expected to start flowing in the fiscal year 2028, Oracle disclosed in a regulatory filing Monday, without naming the customer.
- Stephanie Diaz, BNEF Senior Associate discusses how nuclear power, after decades of being the clean energy pariah, is now the industry’s darling as it seeks out clean, dispatchable power. With rising power demand, regulatory overhauls and ambitious timelines, the US advanced nuclear industry is changing quickly.
- Michele Martin, President of Prosperity– An EisnerAmper Company, recaps 2025 H1 and then provides her outlook on H2 2025.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news. You're listening to the
Bloomberg Intelligence Podcast. Catch us live weekdays at ten am
Eastern on Applecarclay and Android Auto with the Bloomberg Business App.
Listen on demand wherever you get your podcasts, or watch
us live on YouTube.
Speaker 2 (00:24):
Here's some news out on the tech side that got
my attention. I got the attention of the marketplace Oracle,
our good friends therea They signed a cloud service deal
that could be worth thirty billion dollars a year. I said,
we got to get on Ograno on this because this
cloud story, this AI story, is just a story that
continues to give to investors on Rograna, Technology analyst for
(00:44):
Bloomberg Intelligence Joints is here ONROK tell us about this
Oracle deal. Here. What's happening?
Speaker 3 (00:50):
Yeah, I think it caught everybody by surprise. Now, we
knew that this was going to happen sometime over the
next six to twelve months, but we didn't know what
happened so quickly. We think this is part of the
Starfate contract. This is something that's going to flow from
open Ai. You know, the combination between soft Bank, Oracle
and open Ai. So if you remember, there was a
big deal, you know, just I think a day or
(01:11):
two after the president took office where Larry Allison and
you know, got on TV and talked about it. I
you know, we think this is a byproduct of that.
Speaker 4 (01:21):
How is Oracle matching up with its competitors? I mean,
I know it's gained traction for renting out computing power
over the Internet, and of course it's been targeting a
lot of its clients that are focused on AI there.
But how does it look in comparison to peers?
Speaker 3 (01:37):
Yeah, I think you know, it was really I mean
go back a few years. It was, you know, to
be honest, non existent about three years ago. So the
revenue was, you know, just a handful of billion dollars
or so compared to you know, somebody like an AWS
which is now running at a rounderd of over one
hundred billion dollars. So, but this, if you look at it,
in last year alone, oracles infrastructure as a service business,
(02:00):
which is what we look as the proxy for their
cloud infrastructure business, had revenues off about ten billion dollars.
So and then here comes a contract that in three
years and you know, they will have thirty billion dollars
annually from one just one customer. So you could see
just the overall what's happening with AI? What does really
need so much of computing power to run these models?
(02:23):
And this is you know again they are going everywhere,
But Oracle is you know, one of the bigger beneficiaries
over here.
Speaker 2 (02:29):
Rich go rich, the world's richest people. Larry Ellison of
Oracle clocks in a number four two hundred and twenty
nine billion dollars, up thirty seven billion dollars year to date,
the stock is up fifty two week high, an A
rackets at an all time high. What's the bookcase for
Oracle here? It's just just another way to play cloud
(02:53):
slash AI.
Speaker 3 (02:55):
Yeah, so that's the bookcase. Definitely on that end, you
could see the gro thrates are going to pick up
so much more than any of the other cloud providers,
and partially because they're you know, the numbers are too small.
As I said, they're only at about ten billion run
rate or so in this case at this point. So
that's one. But on the other side, you know, they
will have to spend a lot on capex right now,
(03:15):
so that capex number is going to go up margins
are going to most likely take ahead. But frankly speaking,
in this market right now, it's all about market share
gains and which of the companies can actually benefit from
all these large language model training or inference. Basically, you
know they are you know, they're going everywhere. I mean
look at for example, code Weep their growth rate. The
(03:36):
SAME's the case with Microsoft, Azure or EWS. I mean,
everybody in this particular ecosystem is going to make lots
of money.
Speaker 4 (03:43):
We know, expectations remain high for a lot of these
tech firms, especially as we think about the AI push.
What do investors want to see right now? What's the
next step for Oracle?
Speaker 3 (03:53):
I think a lot of this would become to execution
in this case, because you know, this is we are
assuming flawless execution in terms of data centered expansion. But
what if they are not able to get enough power
in there out there? I mean, what if we get
into a shortage in that area. So there's going to
be a lot to you know, I would say ups
and downs, not just for article, but everybody in the
equation where maybe the project gets delayed some funding issues.
(04:17):
Right now, everything is fine when it comes to funding
for these particular projects, but you know, those are the
things that we will watch for. But other than that,
I think the future is pretty bright for all the
cloud providers because of the workloads that are coming in.
Speaker 2 (04:31):
And Rok Rana, thank you so much. We appreciate it.
A Ron Rana. He's a technology analyst for Bloomberg Intelligence.
Joining us via zoom from Chicago.
Speaker 1 (04:42):
You're listening to the Bloomberg Intelligence podcast. Catch us live
weekdays at ten am Eastern on Applecarplay and Android Auto
with the Bloomberg Business app. Listen on demand wherever you
get your podcasts, or watch us live on YouTube.
Speaker 2 (04:56):
All right, we all know about the AI story. The
tech industry is spending get jillions of dollars building up
their computing power their data centers. But you know what,
Apparently you have to power those data centers and that's
a huge demand on the grid. So everybody's trying to
figure out how are they going to do that. One
topic is nuclear, Believe it or not, Nuclear is being
considered heavily as a source of power for a lot
(05:17):
of these data centers. Our next guest is an expert here,
Stephanie Diaz, Senior Associate at BNF Okay, I was alive.
I was in high school with three Mile Island blew
a gasket and we had to go home from boarding
school talk to us about nuclear Where are we as
a country today with nuclear power and how can that
perhaps be a solution to some of the energy needs
(05:39):
of AI.
Speaker 5 (05:40):
Yeah, So, currently we have roughly one hundred gigawatts of
nuclear installed in the US, and we haven't been building
much nuclear. We've built a couple of nuclear reactors in Georgia,
those are the last two, but we currently don't have
any under construction here in the US. Their hopes is
that that would change. The Trump administration, for example, has
an ambitious target to basically quadruple our nuclear fleet by
(06:04):
twenty fifty. Getting there will be quite challenging, though, considering
we really haven't built up the capacity to build on
that sort of scale yet.
Speaker 4 (06:13):
So where are we in comparison to outside of the
US right now? Because I know we don't have a
lot of nuclear here, he mentioned.
Speaker 5 (06:20):
Well, when we say we don't have a lot, I
think we actually have one of the biggest nuclear fleets
in the world. If I'm not mistaken. It's more of
a we haven't really been building much so it's really
hard to see how we all of a sudden start
flexing that muscle to build on that sort of scale.
Speaker 2 (06:35):
I'll tell you what I like for the nuclear I've
heard this story a few times is a modular nuclear
things little? What are they and how do they work?
Speaker 5 (06:43):
Yeah, so one of the a couple of well, there
are dozens of startups out there that are trying to
come up with new nuclear technologies. The majority of the
fleet that's out there globally is these large light water reactors.
What you're talking about is small modular reactors. And the
idea is that we can make nuclear reactors that are
much smaller, with the hopes that we can one require
(07:03):
less capital to build a reactor and two maybe be
able to do it faster and therefore overall be able
to deploy on a much bigger scale. The companies that
are doing that, I mean, there are dozens of them
out there, and they're currently trying to work with the
US Nuclear Regulatory Commission to get their designs approved so
that they can start constructing these as well.
Speaker 4 (07:22):
So can you speak a little bit more about Trump's
ambitious plan here in regards to pushing this forward? Is
that different than the previous administration.
Speaker 5 (07:31):
It is different from the previous administration. Biden already had
what we have been considered an ambitious plan for increasing
nuclear and Trump's school of four gigle or four hundred
giggawatts by twenty fifty is even more ambitious. One of
the things that the Trump administration has done is at
the end of May they issued for executive orders all
(07:52):
aiming to help bring nuclear online much more quickly in
a couple of ways. Mainly it's by expediting the regulatory
review of nuclear reactors. So currently you can take three
to six years to get through that regulatory gauntlet, and
the administration wants to bring that down to eighteen months
for all the different pathways. How they actually go about
doing that remains to be seen, though it's one thing
(08:13):
to say we can do this in eighteen months. It's
another to actually do it. You need to rewrite some rules,
you need to have staff who can review these applications
as they come in. So it remains to be seen
how they want to do it. But there's definitely a
significant push from the Trump administration to bring nuclear online.
But of course it's not just having push from government.
We also need pull from markets. We need to see
(08:33):
more customers sign firm commitments to make sure that these
reactors get built.
Speaker 2 (08:38):
So if when a Microsoft says they're going to spend
a jillion dollars on data centers, is any of that
allocated to powering these data centers or is it? Are
they relying upon utilities and existing grid and all that
kind of stuff.
Speaker 5 (08:50):
No, we've seen not big tech companies. So Microsoft, Google, Amazon,
Metal all announced partnerships with different nuclear companies in order
to have power for all of these data centers. And
it's not just them, it's also lots of data center
providers of names that we often don't know, but they're
the ones who build data centers that other companies use Together,
(09:10):
they've been announcing something like thirty two gigawatts of nuclear
that they want to bring in here in the US
for context, thirty two gigawats in the US for just
data centers. Supposedly in the world currently we have sixty
five giggle watts of nuclear reactor of nuclear reactors under construction,
so they're talking about building a lot. So there's definitely
(09:33):
lots of them thinking about a big time companies thinking
about how they're going to power all of this, but
like I said, it still remains to be seen how
much of it actually comes online. Like I'll be more
excited when I see a construction permit get issue.
Speaker 4 (09:44):
So where do clean energy advocates fit into this whole conversation?
Has there been a push against this at all?
Speaker 5 (09:52):
Yeah, it's been interesting because nuclear for so long has
kind of been the pariah of clean energy, right of
like we know we can do it, but we haven't
done much of it. What we've seen in the last
couple of years has been a big shift towards thinking
more about clean base load power again, and that's why
nuclear and also geothermal have come back into the conversation.
Speaker 2 (10:10):
Power.
Speaker 5 (10:10):
Baseload power is basically think of it as like round
the clock power, So unlike solar and wind, which are
inherently intermitt and this is the stuff where like we
know we can run it as long as we want
to run it, right, like you take it down for
maintenance or something like that, but otherwise it can run constantly.
Speaker 2 (10:25):
Interesting, So is nuclear considered a reliable from that perspective,
reliable source of energy?
Speaker 5 (10:31):
Correct? Because it runs constantly basically.
Speaker 2 (10:33):
And where's it like Norra suggesting it. Has there been
any I haven't heard any pushback from the anti nuke
people out there. Are they just kind of capitulating that
we're going to need all kinds of energy going forward?
Speaker 5 (10:43):
Or I mean, I don't, I don't know about that.
I think maybe it's it's a little harder to I
don't know, be against something when we're well, like I said,
we're still in the announcement stage. We we have a
lot more work to do before we get to seeing
what actually comes online when plans get built and all
of that.
Speaker 4 (10:59):
I mean, are there also just concerns when we think
about nuclear waste? You know, I think that when you
think about a lot of people pushing back, especially on
some of the bills that President Donald Trump is trying
to push and whatnot, how does that kind of come
into play, especially as you think about that against this
ambitious plan.
Speaker 5 (11:17):
Yeah, so nuclear waste is honestly not something that I've
spent too much time thinking about. More than anything, Like
I said, we are still here focused on like can
we even build it? Can we build it cheaply? Like
one of the things that we saw with the two
plants that we most recently built in Georgia was that
they came in significantly over budget. If we want to
build more nuclear in the US, like, one of the
big things we're going to need to do is bring
(11:39):
those costs down before we see any massive scaling in
this industry. Oh yeah, it's much more expensive.
Speaker 6 (11:43):
Ya.
Speaker 2 (11:44):
It's definitely great stuff. Thank you so much for We
appreciate its. Technie Diaz Jus, a senior associate at b
n EF. Those are the folks that have all the data,
all the analysis within Bloomberg about the energy transition that
this country and this world is going through. So they've
they're experts in that stuff.
Speaker 1 (12:01):
Right now, you're listening to the Bloomberg Intelligence Podcast. Catch
us live weekdays at ten am Eastern on Applecarclay, and
Android Auto with the Bloomberg Business App. Listen on demand
wherever you get your podcasts, or watch us live on YouTube.
Speaker 2 (12:17):
Well, I think it seems like forever that leadership of
the stock market has been led by technology. Big tech
has been the leader. We've had a lot of volatility
this year. What if that's still the case? Michelle Martin
joins US president for the firm's name Prosperity. It's an
Eisner Airport Company joining us from Minneapolis via zoom. So,
Michelle's we think about the volatility we've experienced just so
(12:40):
far this calendar year, is Tech still the leader for
this market?
Speaker 6 (12:48):
Hi? Paul, nice to be here. So Tech is actually
not the leader as it relates to where we're at
on a year to date basis. So what a difference
six weeks makes? Right? YEP? With the pullback that we
saw in April and all the uncertainty around tariffs, we've
actually seen value stocks and international in particular IFAH really
(13:10):
pick up momentum, and we're we're actually seeing a market
rotation here, uh, with a move towards international value stocks.
The Magnificent seven is is not the only game in
town anymore.
Speaker 4 (13:23):
So you said the Max seven is not the only
game in town. We're seeing a bit of a rotation
toward international and value. Where are you advising that your
clients be.
Speaker 6 (13:32):
We're we're maintaining some some core allocations to domestic and
obviously growth is not gone, but but we are broadening
our allocations uh to international, Uh, primarily UH, Western Europe.
We're seeing Germany breakout. We're we're really seeing an investment
(13:54):
in defense, a little bit different look on policy, and
then we're also paying attention to alternatives and really making
sure that we have a lot of diversity in our
fixed income as well. So this is this is really
about maybe scaling back a bit on some of the
(14:15):
growth overweight and the SMP overweight and just looking at
a broader market allocation Michelle.
Speaker 2 (14:22):
And in terms of fixed income here, you know you
can sit there with a two year treasure and get
three in a court three point seven three percent. Is
that a place to be or should you be taking
credit risk with your fixed income allocation?
Speaker 6 (14:36):
We still have some credit risk. We've we've scaled back
on credit risk a little bit, Paul, because we are
seeing some potential for slower growth, which which obviously means
there's there's a bit of credit risk, but we're not
seeing big red flakes at this point. The duration that
we're seeing and what we're maintaining in our portfolios is
(14:57):
about five years. We actually went out in duration last
year and have maintained that we think that the longer
duration allows us to pick up more yield. And in
many instances with our clients, we're holding individual bonds, so
so that volatility in uh, in the bonds is not
(15:19):
as as not as real. We're also looking at more
broader managers for fixed income where they can be more nimble,
take advantage of opportunities in the market duration, interest rate differences,
just just really be a bit more nimble. So that's
another area where we're seeing opportunities.
Speaker 4 (15:39):
We talk about investment opportunities, uh, more broadly, where are
you advising clients be are we thinking equities fixed income effects?
Where are the opportunities right now?
Speaker 5 (15:52):
Really?
Speaker 6 (15:52):
You know, from from from the FX perspective, I think
you pick up something when you expand your international exposure.
That's a real simple way to do it. As we
see pressure on the dollar with the tariffs, just by
expanding your international exposure, that's a way to pick that up.
On the fixed income side, I think because we're looking
(16:15):
we're actually looking at fixed income as a pretty stable
You know, you can get four and a half to
five and a half percent on core bond portfolios, very
high quality corporate bonds. So when you're looking at potentially
seeing a relatively slow growth in the second half of
the year, this is something that's a pretty strong ballast
(16:35):
to portfolios.
Speaker 2 (16:37):
Michelle, you mentioned alternatives. What do you guys like in
alternatives and what do you think a reasonable allocation should
be to alternatives.
Speaker 6 (16:47):
So, Paul, we typically for our portfolios, and again it
depends on the client and kind of what their liquidity
needs are, but anywhere from ten to twenty percent in alternatives,
about half of that allocation we look at, and liquid
alternatives things that have hedge funds or hedging buffers, even
(17:09):
buffer ETF strategies can work really well to protect. On
the downside, and another area that we're seeing opportunities and
dislocation in the real estate market, there's very strong opportunities
just because of the rise and interest rates over the
last couple of years. Some developers and properties were kind
(17:32):
of caught flat footed, didn't forecast that. So we're seeing
real buying opportunities, particularly in the multifamily space and as
well in the industrial space. So that those are those
are areas where again taking advantage of dislocations in the
market and then producting on the downside is where we're
seeing the primary use of alternatives.
Speaker 2 (17:53):
Hi, Michelle, thank you so much for joining us. Really
appreciate getting a few minutes of your time. Michelle Martin,
President over at Prosperity. Turn us from Minnea Apples.
Speaker 1 (18:01):
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Listen on demand wherever you get your podcasts, or watch
us live on YouTube.
Speaker 2 (00:24):
Here's some news out on the tech side that got
my attention. I got the attention of the marketplace Oracle,
our good friends therea They signed a cloud service deal
that could be worth thirty billion dollars a year. I said,
we got to get on Ograno on this because this
cloud story, this AI story, is just a story that
continues to give to investors on Rograna, Technology analyst for
(00:44):
Bloomberg Intelligence Joints is here ONROK tell us about this
Oracle deal. Here. What's happening?
Speaker 3 (00:50):
Yeah, I think it caught everybody by surprise. Now, we
knew that this was going to happen sometime over the
next six to twelve months, but we didn't know what
happened so quickly. We think this is part of the
Starfate contract. This is something that's going to flow from
open Ai. You know, the combination between soft Bank, Oracle
and open Ai. So if you remember, there was a
big deal, you know, just I think a day or
(01:11):
two after the president took office where Larry Allison and
you know, got on TV and talked about it. I
you know, we think this is a byproduct of that.
Speaker 4 (01:21):
How is Oracle matching up with its competitors? I mean,
I know it's gained traction for renting out computing power
over the Internet, and of course it's been targeting a
lot of its clients that are focused on AI there.
But how does it look in comparison to peers?
Speaker 3 (01:37):
Yeah, I think you know, it was really I mean
go back a few years. It was, you know, to
be honest, non existent about three years ago. So the
revenue was, you know, just a handful of billion dollars
or so compared to you know, somebody like an AWS
which is now running at a rounderd of over one
hundred billion dollars. So, but this, if you look at it,
in last year alone, oracles infrastructure as a service business,
(02:00):
which is what we look as the proxy for their
cloud infrastructure business, had revenues off about ten billion dollars.
So and then here comes a contract that in three
years and you know, they will have thirty billion dollars
annually from one just one customer. So you could see
just the overall what's happening with AI? What does really
need so much of computing power to run these models?
(02:23):
And this is you know again they are going everywhere,
But Oracle is you know, one of the bigger beneficiaries
over here.
Speaker 2 (02:29):
Rich go rich, the world's richest people. Larry Ellison of
Oracle clocks in a number four two hundred and twenty
nine billion dollars, up thirty seven billion dollars year to date,
the stock is up fifty two week high, an A
rackets at an all time high. What's the bookcase for
Oracle here? It's just just another way to play cloud
(02:53):
slash AI.
Speaker 3 (02:55):
Yeah, so that's the bookcase. Definitely on that end, you
could see the gro thrates are going to pick up
so much more than any of the other cloud providers,
and partially because they're you know, the numbers are too small.
As I said, they're only at about ten billion run
rate or so in this case at this point. So
that's one. But on the other side, you know, they
will have to spend a lot on capex right now,
(03:15):
so that capex number is going to go up margins
are going to most likely take ahead. But frankly speaking,
in this market right now, it's all about market share
gains and which of the companies can actually benefit from
all these large language model training or inference. Basically, you
know they are you know, they're going everywhere. I mean
look at for example, code Weep their growth rate. The
(03:36):
SAME's the case with Microsoft, Azure or EWS. I mean,
everybody in this particular ecosystem is going to make lots
of money.
Speaker 4 (03:43):
We know, expectations remain high for a lot of these
tech firms, especially as we think about the AI push.
What do investors want to see right now? What's the
next step for Oracle?
Speaker 3 (03:53):
I think a lot of this would become to execution
in this case, because you know, this is we are
assuming flawless execution in terms of data centered expansion. But
what if they are not able to get enough power
in there out there? I mean, what if we get
into a shortage in that area. So there's going to
be a lot to you know, I would say ups
and downs, not just for article, but everybody in the
equation where maybe the project gets delayed some funding issues.
(04:17):
Right now, everything is fine when it comes to funding
for these particular projects, but you know, those are the
things that we will watch for. But other than that,
I think the future is pretty bright for all the
cloud providers because of the workloads that are coming in.
Speaker 2 (04:31):
And Rok Rana, thank you so much. We appreciate it.
A Ron Rana. He's a technology analyst for Bloomberg Intelligence.
Joining us via zoom from Chicago.
Speaker 1 (04:42):
You're listening to the Bloomberg Intelligence podcast. Catch us live
weekdays at ten am Eastern on Applecarplay and Android Auto
with the Bloomberg Business app. Listen on demand wherever you
get your podcasts, or watch us live on YouTube.
Speaker 2 (04:56):
All right, we all know about the AI story. The
tech industry is spending get jillions of dollars building up
their computing power their data centers. But you know what,
Apparently you have to power those data centers and that's
a huge demand on the grid. So everybody's trying to
figure out how are they going to do that. One
topic is nuclear, Believe it or not, Nuclear is being
considered heavily as a source of power for a lot
(05:17):
of these data centers. Our next guest is an expert here,
Stephanie Diaz, Senior Associate at BNF Okay, I was alive.
I was in high school with three Mile Island blew
a gasket and we had to go home from boarding
school talk to us about nuclear Where are we as
a country today with nuclear power and how can that
perhaps be a solution to some of the energy needs
(05:39):
of AI.
Speaker 5 (05:40):
Yeah, So, currently we have roughly one hundred gigawatts of
nuclear installed in the US, and we haven't been building
much nuclear. We've built a couple of nuclear reactors in Georgia,
those are the last two, but we currently don't have
any under construction here in the US. Their hopes is
that that would change. The Trump administration, for example, has
an ambitious target to basically quadruple our nuclear fleet by
(06:04):
twenty fifty. Getting there will be quite challenging, though, considering
we really haven't built up the capacity to build on
that sort of scale yet.
Speaker 4 (06:13):
So where are we in comparison to outside of the
US right now? Because I know we don't have a
lot of nuclear here, he mentioned.
Speaker 5 (06:20):
Well, when we say we don't have a lot, I
think we actually have one of the biggest nuclear fleets
in the world. If I'm not mistaken. It's more of
a we haven't really been building much so it's really
hard to see how we all of a sudden start
flexing that muscle to build on that sort of scale.
Speaker 2 (06:35):
I'll tell you what I like for the nuclear I've
heard this story a few times is a modular nuclear
things little? What are they and how do they work?
Speaker 5 (06:43):
Yeah, so one of the a couple of well, there
are dozens of startups out there that are trying to
come up with new nuclear technologies. The majority of the
fleet that's out there globally is these large light water reactors.
What you're talking about is small modular reactors. And the
idea is that we can make nuclear reactors that are
much smaller, with the hopes that we can one require
(07:03):
less capital to build a reactor and two maybe be
able to do it faster and therefore overall be able
to deploy on a much bigger scale. The companies that
are doing that, I mean, there are dozens of them
out there, and they're currently trying to work with the
US Nuclear Regulatory Commission to get their designs approved so
that they can start constructing these as well.
Speaker 4 (07:22):
So can you speak a little bit more about Trump's
ambitious plan here in regards to pushing this forward? Is
that different than the previous administration.
Speaker 5 (07:31):
It is different from the previous administration. Biden already had
what we have been considered an ambitious plan for increasing
nuclear and Trump's school of four gigle or four hundred
giggawatts by twenty fifty is even more ambitious. One of
the things that the Trump administration has done is at
the end of May they issued for executive orders all
(07:52):
aiming to help bring nuclear online much more quickly in
a couple of ways. Mainly it's by expediting the regulatory
review of nuclear reactors. So currently you can take three
to six years to get through that regulatory gauntlet, and
the administration wants to bring that down to eighteen months
for all the different pathways. How they actually go about
doing that remains to be seen, though it's one thing
(08:13):
to say we can do this in eighteen months. It's
another to actually do it. You need to rewrite some rules,
you need to have staff who can review these applications
as they come in. So it remains to be seen
how they want to do it. But there's definitely a
significant push from the Trump administration to bring nuclear online.
But of course it's not just having push from government.
We also need pull from markets. We need to see
(08:33):
more customers sign firm commitments to make sure that these
reactors get built.
Speaker 2 (08:38):
So if when a Microsoft says they're going to spend
a jillion dollars on data centers, is any of that
allocated to powering these data centers or is it? Are
they relying upon utilities and existing grid and all that
kind of stuff.
Speaker 5 (08:50):
No, we've seen not big tech companies. So Microsoft, Google, Amazon,
Metal all announced partnerships with different nuclear companies in order
to have power for all of these data centers. And
it's not just them, it's also lots of data center
providers of names that we often don't know, but they're
the ones who build data centers that other companies use Together,
(09:10):
they've been announcing something like thirty two gigawatts of nuclear
that they want to bring in here in the US
for context, thirty two gigawats in the US for just
data centers. Supposedly in the world currently we have sixty
five giggle watts of nuclear reactor of nuclear reactors under construction,
so they're talking about building a lot. So there's definitely
(09:33):
lots of them thinking about a big time companies thinking
about how they're going to power all of this, but
like I said, it still remains to be seen how
much of it actually comes online. Like I'll be more
excited when I see a construction permit get issue.
Speaker 4 (09:44):
So where do clean energy advocates fit into this whole conversation?
Has there been a push against this at all?
Speaker 5 (09:52):
Yeah, it's been interesting because nuclear for so long has
kind of been the pariah of clean energy, right of
like we know we can do it, but we haven't
done much of it. What we've seen in the last
couple of years has been a big shift towards thinking
more about clean base load power again, and that's why
nuclear and also geothermal have come back into the conversation.
Speaker 2 (10:10):
Power.
Speaker 5 (10:10):
Baseload power is basically think of it as like round
the clock power, So unlike solar and wind, which are
inherently intermitt and this is the stuff where like we
know we can run it as long as we want
to run it, right, like you take it down for
maintenance or something like that, but otherwise it can run constantly.
Speaker 2 (10:25):
Interesting, So is nuclear considered a reliable from that perspective,
reliable source of energy?
Speaker 5 (10:31):
Correct? Because it runs constantly basically.
Speaker 2 (10:33):
And where's it like Norra suggesting it. Has there been
any I haven't heard any pushback from the anti nuke
people out there. Are they just kind of capitulating that
we're going to need all kinds of energy going forward?
Speaker 5 (10:43):
Or I mean, I don't, I don't know about that.
I think maybe it's it's a little harder to I
don't know, be against something when we're well, like I said,
we're still in the announcement stage. We we have a
lot more work to do before we get to seeing
what actually comes online when plans get built and all
of that.
Speaker 4 (10:59):
I mean, are there also just concerns when we think
about nuclear waste? You know, I think that when you
think about a lot of people pushing back, especially on
some of the bills that President Donald Trump is trying
to push and whatnot, how does that kind of come
into play, especially as you think about that against this
ambitious plan.
Speaker 5 (11:17):
Yeah, so nuclear waste is honestly not something that I've
spent too much time thinking about. More than anything, Like
I said, we are still here focused on like can
we even build it? Can we build it cheaply? Like
one of the things that we saw with the two
plants that we most recently built in Georgia was that
they came in significantly over budget. If we want to
build more nuclear in the US, like, one of the
big things we're going to need to do is bring
(11:39):
those costs down before we see any massive scaling in
this industry. Oh yeah, it's much more expensive.
Speaker 6 (11:43):
Ya.
Speaker 2 (11:44):
It's definitely great stuff. Thank you so much for We
appreciate its. Technie Diaz Jus, a senior associate at b
n EF. Those are the folks that have all the data,
all the analysis within Bloomberg about the energy transition that
this country and this world is going through. So they've
they're experts in that stuff.
Speaker 1 (12:01):
Right now, you're listening to the Bloomberg Intelligence Podcast. Catch
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Speaker 2 (12:17):
Well, I think it seems like forever that leadership of
the stock market has been led by technology. Big tech
has been the leader. We've had a lot of volatility
this year. What if that's still the case? Michelle Martin
joins US president for the firm's name Prosperity. It's an
Eisner Airport Company joining us from Minneapolis via zoom. So,
Michelle's we think about the volatility we've experienced just so
(12:40):
far this calendar year, is Tech still the leader for
this market?
Speaker 6 (12:48):
Hi? Paul, nice to be here. So Tech is actually
not the leader as it relates to where we're at
on a year to date basis. So what a difference
six weeks makes? Right? YEP? With the pullback that we
saw in April and all the uncertainty around tariffs, we've
actually seen value stocks and international in particular IFAH really
(13:10):
pick up momentum, and we're we're actually seeing a market
rotation here, uh, with a move towards international value stocks.
The Magnificent seven is is not the only game in
town anymore.
Speaker 4 (13:23):
So you said the Max seven is not the only
game in town. We're seeing a bit of a rotation
toward international and value. Where are you advising that your
clients be.
Speaker 6 (13:32):
We're we're maintaining some some core allocations to domestic and
obviously growth is not gone, but but we are broadening
our allocations uh to international, Uh, primarily UH, Western Europe.
We're seeing Germany breakout. We're we're really seeing an investment
(13:54):
in defense, a little bit different look on policy, and
then we're also paying attention to alternatives and really making
sure that we have a lot of diversity in our
fixed income as well. So this is this is really
about maybe scaling back a bit on some of the
(14:15):
growth overweight and the SMP overweight and just looking at
a broader market allocation Michelle.
Speaker 2 (14:22):
And in terms of fixed income here, you know you
can sit there with a two year treasure and get
three in a court three point seven three percent. Is
that a place to be or should you be taking
credit risk with your fixed income allocation?
Speaker 6 (14:36):
We still have some credit risk. We've we've scaled back
on credit risk a little bit, Paul, because we are
seeing some potential for slower growth, which which obviously means
there's there's a bit of credit risk, but we're not
seeing big red flakes at this point. The duration that
we're seeing and what we're maintaining in our portfolios is
(14:57):
about five years. We actually went out in duration last
year and have maintained that we think that the longer
duration allows us to pick up more yield. And in
many instances with our clients, we're holding individual bonds, so
so that volatility in uh, in the bonds is not
(15:19):
as as not as real. We're also looking at more
broader managers for fixed income where they can be more nimble,
take advantage of opportunities in the market duration, interest rate differences,
just just really be a bit more nimble. So that's
another area where we're seeing opportunities.
Speaker 4 (15:39):
We talk about investment opportunities, uh, more broadly, where are
you advising clients be are we thinking equities fixed income effects?
Where are the opportunities right now?
Speaker 5 (15:52):
Really?
Speaker 6 (15:52):
You know, from from from the FX perspective, I think
you pick up something when you expand your international exposure.
That's a real simple way to do it. As we
see pressure on the dollar with the tariffs, just by
expanding your international exposure, that's a way to pick that up.
On the fixed income side, I think because we're looking
(16:15):
we're actually looking at fixed income as a pretty stable
You know, you can get four and a half to
five and a half percent on core bond portfolios, very
high quality corporate bonds. So when you're looking at potentially
seeing a relatively slow growth in the second half of
the year, this is something that's a pretty strong ballast
(16:35):
to portfolios.
Speaker 2 (16:37):
Michelle, you mentioned alternatives. What do you guys like in
alternatives and what do you think a reasonable allocation should
be to alternatives.
Speaker 6 (16:47):
So, Paul, we typically for our portfolios, and again it
depends on the client and kind of what their liquidity
needs are, but anywhere from ten to twenty percent in alternatives,
about half of that allocation we look at, and liquid
alternatives things that have hedge funds or hedging buffers, even
(17:09):
buffer ETF strategies can work really well to protect. On
the downside, and another area that we're seeing opportunities and
dislocation in the real estate market, there's very strong opportunities
just because of the rise and interest rates over the
last couple of years. Some developers and properties were kind
(17:32):
of caught flat footed, didn't forecast that. So we're seeing
real buying opportunities, particularly in the multifamily space and as
well in the industrial space. So that those are those
are areas where again taking advantage of dislocations in the
market and then producting on the downside is where we're
seeing the primary use of alternatives.
Speaker 2 (17:53):
Hi, Michelle, thank you so much for joining us. Really
appreciate getting a few minutes of your time. Michelle Martin,
President over at Prosperity. Turn us from Minnea Apples.
Speaker 1 (18:01):
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ten am to noon Eastern on Bloomberg dot com, the
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