YouSaid · the spoken record

Sonal Desai

lines on the record: 68
first: 2025-07-24
most recent: 2025-07-24
sittings or episodes: 1
sources: podcast

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“You know, the biggest thing, I'd say, is that nothing while in the moment it feels like the catastrophe is going to end the world. Number one, it won't. Number two cycles end. I would have had a lot fewer sleepless nights if I could have just calmed myself down and said OK, this too will pass. And so I think I think that there is an element of just knowing that this is a part of what we do.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“There's that part of it, and I think The other piece I would say is it's very hard, I know, but try not to be too impatient. If you can't go through a few market cycles, it's very difficult to really understand markets, right? So I don't believe in time and grade. I'm all for people jumping ahead. But sometimes nothing substitutes for actually living through different market cycles in our business.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Number one Be extremely curiously curious I would note that learn to do research. I'm not talking about research. What I'm saying is especially today with gen AI I think one of the worst things is immediately having answers because if you don't learn to spend the time to dig really really deep into different areas, I don't think you're going to find answers. You're not going to be able to find the answers all written in the first three lines of a Google search. Actually, I do think that”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“So it's a series of books, The Protagonist is called Kate Daniels, and I think the first one was Magic Bites or something like that. It's set in a dystopian Atlanta where you have a mixture of various types of supernatural elements and things like that. It's really cool.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, so some of my favorites, I've got an enormously varied, the only thing I don't read is horror of any kind. It scares me too much. My imagination is too real. But if I think about things I always go back to, I will throw out, there's the master in Margarita, which is Mikhail Bulkakov, which was the first book which I actually seen, it was transcendental, I think. Love, pride and prejudice. I love the Lord of the Rings. And currently I'm reading Urban Fantasy. It's called The Author's Names are Ilona Andrews, Kate Daniels. It's very escapist. It's about as escapist as anything I think you would watch on Netflix. It is absolutely fantastic.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“And I still find myself using hand gestures that I've learned from him and I still find myself doing this. How amazing is that? Because now you're talking about a very long time ago. And he definitely shaped how I work in the workplace.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“So, you know, my earliest mentor, I'd have to say, is my father. I grew up in India. In India, the path that I followed is not very traditional. And I have two brothers and my father always treated me exactly the same as my brothers. And so in a sense, when people ask me even today, how do you get more women into the workplace? And I get asked this question around the world when I go to our different offices, I tell everyone. You know, encourage your daughters, your sisters, your wives to be in finance, and they will be in finance. My father did not encourage me to be in finance. He did encourage me to think exactly the way, frankly, my brothers were thinking in terms of what the future held. So he was my earliest mentor. Second mentor, I would have to say is one of my first mission chiefs at the IMF, Paul Thompson, who subsequently actually led missions to Greece and became the director of the European department. He was my first mission chief, and he is an amazing negotiator.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Which implies we won't fall into a recession, but I do think at some stage there needs to be some change in policy which reduces that deficit meaningfully. And I'm not sure you can do that without actually reducing growth. This is an additional reason why I don't think the Fed should go too far today. Are we, and I think this is a long way of saying, there's almost nothing that we don't talk about. It is a question of the timing. I think today we're probably looking at most of the important things that need to be looked at.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“So that's a really excellent question. In this day and age, I think you can't talk about what's being overlooked without talking about time horizon. I think that we are all talking about fiscal, but in very vague terms. And the mistake we are making is acting as if we suddenly got a fiscal deficit. We have been running ridiculous deficits for the last close to five years now, and it's very much like the excesses we saw with QE in the sense of monetary policy, which lasted long after it should have been withdrawn. And we're seeing that now. I don't see any desire on either party's side to do something serious about that deficit.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“No, actually, I don't think they're messing up. This is a very dovish fab, by the way. Everyone says that all markets will panic if we get a dovish fed chair. Hello, the last non-dovish fed chair we had was Paul Volcker. We haven't had a hawkish fed chair in an enormous amount of time and I don't see it happening now. It's not in the Fed's DNA.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Barry, look, we talked a little bit about what I thought a reasonable Fed funds rate was when I call it neutral, I mean the economy is neither falling into recession or overheating i. e. inflation accelerating. I think that number is 425. Given where rates are right now, last year, before all of these ups, downs and ins and outs, I thought the Fed had within its gift around 125 to 150 basis points of rate cuts in all. And they did 100 basis points already. So I think there isn't an unlimited amount that the Fed really or should do, will they do more? Probably, you know, I don't know whether it's this fed or next year. At some stage, they can. It won't be catastrophic. I don't think it's particularly wise to cut rates dramatically. Are they messing up right now?”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it could be, but the only thing is the multiplier for defence spending is one of the lowest multipliers you have. Your highest multiplier is going to be what we did, which was to helicopter drop checks during COVID to everyone. That has a very high multiplier eventually. But if you look at defenses, the multiplier is 0.4. It's a low, low, low multiplier. Separately, you have other issues which I think are not discussed enough. I think it will make its way. I don't want to come across as being overly negative. I think it's very positive that the Europeans are taking their own defense in hand. I think we and markets need to be cautious in terms of the speed at which we think this will show up.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Me have a certain degree of I'm not going to go as far as saying skepticism, but caution in terms of how quickly this money will actually show up.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“So that happened, and then you had Liberation Day. You had three sets of reasons and the European equity market had been lagging so much, more than even the Nikkei in Japan. It was obviously a good time for people to go put money back there. And I think there's a little bit of catch-up going on. So I don't think it's anything deep and amazing. And quite frankly, if I look at European growth, European growth is not yet showing. German growth is not yet showing any impact from the one trillion tenure dollar spend. It's not yet showing up. I personally think that perhaps it's going to be a bit too far because if I look at funds which had been approved during COVID time, they still have not been able to deploy them. The Europeans are tied up in red tape at a level which makes”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“You made out like a bandit. If you were smart, you took some profits, right? As soon as you got deep sea happening, in short order afterwards, you got the Germans suddenly talking about 1 trillion euros over 10-year period in terms of spending. So the last fiscal man standing, like I like to say, goes toppling down and we all go, yay, yay, yay, that happened. But more seriously, it meant that potentially European growth would not look as lackluster, frankly, as it has been for a while.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Do you know that since the Plaza court, I didn't realize we're talking about the absolute strongest levels in trade-weighted terms in something like close to 45, 50 years, really strong. Then what happened? We came into this year, and the first thing that happened, frankly, was deep-seek. You know, deep seek burst, and somehow, oh my God, the US is not exceptional. And people were putting US exceptionalism hand in glove with the Mag seven, I think. However, if you were a European investor, right, last two years, you got 54% just on the S&P and then you got, what was it, 10, 15% in dollar appreciation?”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“So, you know, the euro area, so if I look at the equity markets, I think you can't really talk about the equity markets without talking a little bit about the dollar. And that actually impacts EM as well. And I see a lot of discussion again, and it's somewhat related to our previous comments on geopolitics, that somehow the dollar is no longer fit to be the world's reserve currency. It is the end of US exceptionalism, etc., etc. I think it's mixing up a whole bunch of things. Number one, when we entered this year, in trade weighted terms, the dollar was at its strongest level since the Plaza Accord.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“And so I do think that in the early days of this administration, certainly early days post-liberation day, there was a thought that somehow you have a complete realigning of the geopolitical environment with the US not being credible or dependable. I think that was overstated. The US is more important than any one administration or any one single set of policies.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Then they have over a very long period of time. So that's a positive. I think the issue of China, you have different geopolitical stress points. You have the trade tensions, but then separately there's the eternal question of what happens with Taiwan. And that is always going to be a part of the backdrop. And I think a lot of people take a great deal of comfort from the fact that the Chinese authorities are extremely, extremely careful. And so we don't anticipate shooting from the hip, so to speak. So this is something which we will continue to see stress points go up and down.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“We all thought this was going to be a short period and geopolitics became very central to everyone's thinking. It's gone on for three years. It's not unclear when, if ever, it's going to go away. And I think what's happening is that geopolitical uncertainty has become so much a part of the backdrop that you can't actually manage your portfolio to that geopolitical risk. You can, when risks get sharply higher, you can try doing something, but you cannot position your portfolio for these geopolitical risks. So what are the geopolitical stress points? The Middle East is, frankly, it was a forever geopolitical stress point which has to give this administration its due come markedly lower based on what we have seen so far. I think actually things are looking a lot better in the Middle East.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“I think the interesting thing about geopolitics is that Increasingly, it's become a backdrop, and I think that markets are not capable of remaining in a heightened state of panic and anticipation indefinitely. What I mean is when Russia went into Ukraine,”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes. Four to seven. No, I'd say it's shorter, right? I'd say it's shorter than four to seven. So I'd say I'd stay a little bit shorter right now because, like I said, we're at 440. I don't think it would take us very much. Over here. And then, if you've taken on a lot of duration, it will hurt you. Now, if you're taking some of that credit risks, should you be hedging it out? That is something which you can consider. But outright simply going long. I wouldn't do too much. In terms of we actually still think That there is an enormous amount of cash still sitting on the sidelines and everything from money markets onwards, and perhaps one of the best things to do is to at least dip your feet in and get at least to ultra short, get yourself comfortable with ultra short so you can start moving out the yield curve.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Clearly, there are many areas of uncertainty, and these are the reasons why from my perspective my baseline on the fundamentals economic fundamentals is no recession, but given how assets are priced right now, I would not go overboard loading up on risk at current levels. There are many reasons to anticipate, for example, additional corrections, including on the equity markets, frankly, just from a macro perspective, which we don't have right now.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it actually makes it a little bit more difficult. We talked earlier about the issue of pricing risk. When you have this much of liquidity, those spreads, people will get forced into riskier products. You can't stay out of the market because you need to clip that coupon. So you are present, but Like I said, you're not getting massively over your skis in terms of adding on extra risk, because things are priced to perfection in a market like this one. So what I mean by this is my baseline is that we don't get a recession, as we spoke about it. Nobody has perfect foresight into what this looks like. You could get anything coming out of left field. COVID came from somewhere none of us anticipated. Very short recession, but it had very meaningful consequences.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Ballast in your portfolio when your equity market delivers equity like returns. And that is the future state that I anticipate for fixed income.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think it's a good time for fixed income from the following perspective you're getting yield from fixed income and I think you'd probably sell off a bit more. You're getting income from fixed income. Let's put that way. And again, talking about generations of people who were used to getting two and a half percent for their, you know, there was a point where given where inflation was and given where tenure treasuries were, we were paying the government in real terms for the privilege of lending the government money, which is what you're doing every time you buy a treasury. But at least we're not there anymore. We're getting positive real returns. I think it is a constructive environment for fixed income, but you can't expect equity-like returns from fixed income. And again, because of liquidity flows and so on, people have become a little bit married to the idea of fixing income delivering massive outperformance. And what it should really be doing is giving you boring returns. You know, boring returns, it should be the”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“At this very abnormal, unorthodox monetary policy for a large part of this period. And I look at the decades prior to that Neutral Fed funds was around four hundred fifty five percent. That was what this economy took. What does that neutral Fed funds rate consist of, inflation, and what you think productivity growth is going to be? I think inflation has around 2%, two and a quarter, and productivity growth, we're kind of cruising back towards that 2%-ish level that we were, gives you your Fed funds”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Is this a screaming by? Should you be jumping in because you think that treasuries are going to rally massively? And the answer is actually no. I would call myself aggressively neutral. I'm stealing that term from a colleague of mine. Aggressively neutral at this range. I think fair value for U.S. treasuries actually is probably today at between $475 and $5. So in fact, I think there's more for U.S. treasuries to sell off. And thus, this is the backdrop. Now, why do I think this? I think all these complaints about where the Fed is, you know, the Fed should cut rates, cut rates, cut rates, well, I think the neutral Fed funds rate is actually between 4 and 425 or so. So I don't think the Fed has that much room to cut rates. Why do I think it's 4%? Is this a magic number? Well, if I again abstract from these post-GFC 15, 17 years that we're looking at”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Terms for a high yield or a risky bond for a high yield corporate. Now this I think remains reasonable if you are active. I wouldn't buy passively into this because when you have way too much liquidity, clearly some excesses are bound to creep up. And I think that probably they have. We are active managers, so we're literally doing bottom-up picking company by company and I think you need to do that. So what do you do? I look at tenure treasuries and I look at Fed funds and I try to decide at 440, 450 where range trading right now”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“So I'd say the implication is when you're looking for let's call them risky assets within the fixed income space to invest in it's quite difficult. Like I said, typically risk assets, you look at the premium you get for taking the risk over the risk-free asset, which is of course the treasury. And the reality is there's clearly enough to the point of complacency, I would say, comfort around what is going on within the economy and what the expectations are from the Fed, that those spreads, if I again I point to something like high yield, they're nowhere close to what I think would be reasonable. Nonetheless, you are getting close to 7%, 7.5%, depending on the day you're looking at it, not in spread terms, but an all-in.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“And you can make it. And I'm an immigrant, I'm a naturalized American, and I have to tell you, that's what I bought into, and I really believe in it. I love that about this country.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“It is. You know, there are trade offs on everything, right? So we could have an entire philosophical discussion in terms of the choices people make, and everyone doesn't make the same choices. Can and is a lack of innovation, which you see across the board because there is no Europe. The desire of a risk taking. And that's what permeates the entire American dream, so to speak. You know, you work really hard. You can be entrepreneurial. You go out there. You do great things.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“And again, I'd come back to the idea that these are choices made by democracies and there are no right and wrong answers. So it's wrong for us to say get rid of your VAT. They made the choice to have that VAT.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“The Europeans aren't consuming not European stuff and not American stuff. And we have some of the lowest taxes in the world, and everyone, we consume everybody's production, so we are supporting global GDP via our desire for consumption.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“And they also export outside, right? So they're very, very dependent on what the winds of the rest of the world are because they need, here's the reality of it. You know, every time the administration talks about VAT as a trade barrier, any economist will tell you, that's just plain wrong. It's a trade adjustment. No, no, basically, it's not a barrier because what we call a border adjusted tax. So, you know, we export a car to Germany. Absolutely. You have to pay VAT there, but you'll have to pay the VAT on the BMW. Doesn't matter. Whatever you're going to consume, you're paying VAT. So that's just wrong. However, if you want to take, again, that 20,000 foot up in the air view to this, there is an economic model, which I think the Europeans have chosen to follow, which is to penalize consumption in Europe with the”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Imports are 10-12% of our overall GDP because we import around 4.5 trillion of goods and services, three and a half of just goods, four and a half trillion out of a 30 trillion economy, call it 12, 13%. That is where we are looking in terms of our imports and you compare this to a German. Germany, including its exports to the rest of the euro area, it's around 44% of GDP.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Small percentage. Exactly. I think you're totally right, you know. And here's the thing. Should we be manufacturing more in the US? This is actually a political decision and people vote for this. And anybody who says that's a crazy idea, well, Germany does it, Japan does it. It's a choice. It's a choice. It's a political choice. And I think that it is up to the people of our country to decide which direction do they wish to go in. There's no right answer. It's a democracy. People need to choose. However, it is an incredibly wealthy country. And therefore, when we talk about imports and exports, I look at exports, which is how our GDP gets impacted via tariffs or trade or anything.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Of raising revenue, they're distortionary because they randomly hit some products relative to other products. I don't love tariffs. I just don't think that they are as catastrophic for the US as they are for the rest of the world. The rest of the world, yeah, it is a big problem. The US, it's a huge economy which is essentially a large closed economy. Closed the economy.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“All of this huge economy size, and I say okay, they're talking about putting tariffs, you know, let's assume tariff revenue ends up being three hundred billion a year. It's not, you know, it could be much lower. $300 billion, if I were to spread this out over all goods and services like the Europeans do using a VAT, that's a 2% tax. Would we all be jumping up and down saying vibe session if magic happened and the federal government did something very intelligent and put just a small consumption tax on the economy to lower the budget deficit, we wouldn't. So I guess what I'm trying to say is I don't love tariffs. Please, tariffs are a highly inefficient form.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Everybody, yeah, you know, I really never bought the vibe session idea on tariffs. I mean, let's, can we talk about tariffs? Sure. I mean, it's been talked to death, but why not? Let's talk about tariffs briefly. Here's the thing. I look at our country and I'm going to use big round numbers here, right? We're about a 30 trillion economy. Okay, 29, call it 30 trillion economy. 70% of our economy. Is consumption. Okay, so you get to around 2021 trillion. 70% of consumption is services. Guess what? Services aren't really impacted by tariffs. Now I go to, okay, I've got around six, six and a quarter trillion of consumption of goods. How much of this is actually imported around three point four trillion of goods are imported. So I'm looking at 3.4 trillion against.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Absolutely. Huge. And I think that the speed of the new cycle, the need for clickbait style tweets, headlines, whatever it is, I think that exacerbates Every sentiment, however, people still seem to be relatively sensible in terms of how they actually behave because we're not hearing about people massively cancelling their European vacations, which according to Delta we're taking in record numbers, right? It's so funny.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“Remotely liked. I have to say that I'm looking a little bit less at some of these indicators. I think they need to be leavened. We need to now do more digging. Our country has become very polarized and that feeds into people's sentiment. It doesn't feed into their shopping habits. That's the reality, right?”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that is a fair statement because here's the thing you know in the first few months of this year we saw sentiment tank and everyone said well hard data will follow I wasn't so sure because sentiment was moving on something which was unusual it wasn't moving on the back of weakness and labor markets or people feeling uncertain about their jobs it was weakening on the back of pronouncements you know on top of policy pronouncements I'd say the execution of that stuff was really bad and continues to not be particularly good in terms of tariffs that impacted sentiment however people continued to spend they didn't stop spending as you said and I'm not suggesting that this economy's recession proof I'm just saying so far we haven't got whatever we need to push us right”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“I haven't been. I haven't been. I'd say that I can proudly say that it's been, you know, I'm on record. So I think it was in probably early 2021 when inflation started picking up that I was saying this isn't looking so good. This transitory stuff isn't looking so good. And most importantly, it wasn't at all clear to me why we were expanding fiscal while we also had this massively easy monetary policy and how that could possibly result in a recession. And we've been having recessions which are two quarters out now, I think rolling two quarters out for the better part of something like three and a half years. And I will say We've not bought into that. I think it's a very strong economy.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“This to me means that while people like to talk the talk of recession, what they're really saying is cut rates. We want more liquidity because we're not getting rid of all of our assets over here, the risky assets, which should sell off if people truly expected a recession.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“six hundred, six hundred fifty even higher We've never gotten there still very tight no today we are close to record types right we're only looking at a few hundred basis points we're sub 300”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“It is the fact that when financial markets started moving out along the yield curve, out along the risk spectrum, I've even seen the IMF talk about Orwell markets need to price risk correctly. Well, hello they were forcing us into those positions explicitly when the first set of QE one two threes happened, it was explicitly there to get financial markets to take risk again. QE1 definitely, QE1 and 2 maybe markets had frozen up. We needed to liquefy frozen markets. And to me, if I look at that, that made sense. Problem is we hung on to it for too long. If I look at high yield credit, let's talk about fixed income markets, high yield credit. Typically in a recession spreads of high yield credit over treasuries, equivalent treasuries should be at around 1%.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“The Fed put eventually it was a fed put, then people thought there was a trump put, and quite frankly over the last four or five years we've had a fiscal policy put, we have puts all over the place. And I think that what happens in that environment, you know, when I said that we need price, risk, start remembering again how to price risk appropriately”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“What I mean by that is I said more than it's I'm looking now since the global financial crisis and Barry we just talked about the fact that there are entire generations of people who have never lived in a world where liquidity was anything other than hyperabundant. And by the way we're still in that world. You look at the Fed's balance sheet. You're still enormous. I think it's very hard for people to even realize that the Fed sat on a minuscule balance sheet prior to this. We were not in a situation where Essentially there was always a get out of jail for free card out there in the club.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source
“A lot of hindsight bias. Yes, and there's also what just happened and therefore why it should continue happening. And I think that's something which I never realized how deeply ingrained it is and how difficult it is to break people out of that way of thinking.”
2025-07-24 · Masters in Business · Franklin Templeton's Sonal Desai on Fixed Income · IDENTIFIED FROM THE TRANSCRIPT · source