The MIT Website, Newsletter and Market Wrap

In this Market Wrap Alan brings you through the latest in the Middle East, Private Credit, the Hungarian election loss for Viktor Orban and a preview of the amazing interviews guests this week including Professor  Donnacha Ó Beacháin.

Transcript

SPEAKER_00 0:00

So Donald Trump has said, you know, he wants Canada to be the 51st state. He wants Greenland and indeed has made all sorts of threats to Denmark and indeed you might say Europe collectively and his NATO allies, who he constantly refers to as them or they, it's not we. He talks about getting Panama back. You know, he is certainly looking for at least hemispheric in you know dominance. And, you know, they constantly emphasize that they are the preeminent economy, they have the largest military, so that hemispheric dominance is a prerequisite for global dominance in many respects. And this comes, of course, at a time, as we know, when the US economy has been in relative decline for some years. So you might say this is a desperate gamble on their part, alienating allies and adversaries at the same time.

SPEAKER_01 0:43

His world, as he's, as you say, collapsed around him.

SPEAKER_00 0:46

How scarred was Putin from that experience? He was very scarred. In Dresden, you know, he was there was the Stasi, which was the East German secret police, and then there was the KGB element of which he was a part. And, you know, as the popular mobilization, the democratic impulse took hold. His instinct was, of course, as a man who had made his career hunting down dissidents, people essentially who are interested in democracy or overthrowing the regime, his instinct was to use force to suppress this popular mobilization. And he he contacted Moscow looking for more or less the green light to do this. And this is also the title of an episode that was out recently on the Cold War. The response that he got is Moscow is silent. Moscow isn't saying yes, Moscow isn't saying no, Moscow's just not responding. Because Moscow had been signalling to the regimes in Central and Eastern Europe, those dictatorships which had been established by the Kremlin, that you are economically and politically, and militarily most importantly, perhaps, you're on your own. He has some superficial, I guess, comparisons with Joseph Stalin in this one respect, in that Stalin was always underestimated. People always thought it was going to be Leon Trotsky, for example, or other luminaries in the Politburo who would succeed Lenin. Stalin was seen as a predictable, reliable, but unimaginative apparatchik. And that was very much how Putin was perceived as well. He wasn't a guy that people noticed in the room when they entered it. And that makes his rise all the more, I think, illuminating and remarkable. He delivered for those he served under until he was serving under no one else but himself.

SPEAKER_01 2:17

So the voice you just heard there was Professor Dunica Blackcoin, and I finished an interesting conversation with Dunica just now, and that will be released this week. So coming to you a little later than usually planned, usually released this on a Friday, but events in the Middle East and a couple of announcements relating to the channel meant that we just delayed it slightly. So stay tuned for some very interesting announcements in relation to the newsletter and also the rollout of our new website specifically for the most important thing podcast. So you're gonna want to stay tuned for that. So Professor Donico Baccoin is an expert in post-Soviet politics and a number of other issues. He is a professor at the DCU School of Law and Government, and our conversation was very deep across several topics. Vladimir Putin, interestingly enough, featured quite a lot, and any discussion around financial markets, global economy, geopolitics, he features very centrally in all of that. So Dunica won an essay competition and he ended up in eastern Germany in 1989, a few months before the Berlin Wall came down. He ended up in Dresden, and interestingly enough, Vladimir Putin was in Dresden at the same time as Dunica was. So that was something that was uh interesting that came about. So stay tuned for more of Dunica later in the episode. But what I want to talk to you about now is of course what's going on in financial markets, and to do so, I'm going to use the newsletter. So, what I want to say to people is first of all, I'm going to click on to share my screen, click on to the website where you can access the newsletter. Okay, so you should now be able to see uh the most important thing podcast website, and there's a few very famous names, as you can see, the best and the brightest in economics, finance, geopolitics, and there's going to be lots and lots of resources. You can click on subscribe up here, and that'll bring you on to uh our newsletter. You'll also get a hundred-page document. This is this uh hundred-page document here, learning guide that includes all of my recommended books for beginners and professionals, and also a documentary guide. Uh, I hosted a recent AI summit with some of the best and the brightest in Ireland and globally, I would argue, and we've got the summary of that and loads, loads more. So just register there and you get all of this information for free. We have the uh episodes, the podcast episodes, individual resources there where you can click on and see the podcast episodes. So by the time of release, uh the website should be live, and I hope you find that useful. What we're going to go to next is looking at this week's newsletter. The point of the newsletter really is to summarize, synthesize the core readings, core things that I think are interesting in financial markets, global economy, geopolitics, but it's not going to be very dense. So we're all really time poor these days. So what we want is a 15-20 minute max kind of summary synthesis of what's actually happening, what's going on in financial markets. So let's take a look at the newsletter. And when you register on the website, you'll be on our uh weekly newsletter list, and we will send it to you. Okay, so let's share my screen again. Okay, so you should be looking at the weekly market research report. Now, this is going to come out every week, and what it is top of mind market insights for investors who care about signal. Remember, so far, the reason we've been speaking to experts is we're trying to cut through the noise. There's so much bloody noise out there, right? We're trying to cut through it and get to the signal, the signal as in uh giving us the real information we need that's perhaps not priced into markets. Remember, we're looking for stuff that's not priced in uh because that's what we're gonna hopefully get rewarded for. What's it for? It's prepared by me and the MIT podcast team for serious investors, operators, and capital allocators, right? That sounds very definitive, but it's not. It's really for anybody that's interested in financial markets. Lots of students have contacted me, by the way. And yeah, absolutely, students, retirees, uh, professional investors. Okay, so the table of contents, and this is going to be rigid every week. You've got your executive summary, the macro pulse. That's looking at a dashboard of financial indicators. Uh, we're just going to look at the s the markets today. The chart you can't ignore. Uh, a market insight, a voice of reason. That's typically something, a good article I've read or a book uh from the podcast looking towards this week to see what's going on. A final thought in the week ahead. So, a gentleman that was in the news this week was obviously Pope Leo the Fourteenth, and for all the right reasons I would say. Uh, in fairness to the man, he's not going to sit back, he's an American, so he's ruffling feathers, and he is um not afraid to speak his mind. And fair play to him, I say. So this week's image is of Pope Leo. He's pushing back against uh what he sees as tyranny of a few handful of global leaders. It's difficult not to support his views. So I actually wrote this report on Friday. It's now Sunday, okay, because as I said, we were slightly delayed given uh the launch of the website and a couple of other things. So I wrote this on Friday. Another Friday, another peace deal. How long will it last this time? There does appear to be a bit more substance to this most recent ceasefire agreement between the US and Iran. It also appears that President Trump has grown impatient with his friend Benjamin over in Israel. The Iranians appear to have got what they wanted and ended Israeli attacks on Lebanon. Just two problems that we can see. One, the Israelis are saying that they won't pull out of southern Lebanon, and two, Trump is saying the US blockade of the Hormouth Strait stays in situ. As expected, stocks rallied, bond yields fell, and oil plummeted. From a political perspective, it may be too little too late for Trump, as poly markets continue to indicate that the White House is in for battering in November. Expect the older concerns relating to AI bubble concerns and private credit to re-emerge from the shadows if, and I said that's a big if this thing holds together. Now, literally a couple of uh hours you could say later, uh we had a breakdown in this whole thing, and we're back to kind of uh not square one, but we're back to you know disruption again. Uh the Iranians saying they're going to uh close the strait and there's been attacks on tankers forced to turn back. It's a mess, it's a complete mess. And you have to make one very important observation, and that is that the Iranians weren't attacking uh oil tankers before all this started, and they've got real leverage now on Mr. Trump. So looking at the global, what is this? This is a macro scoreboard looking at global stock indices. So the top I've got the US markets, the ticker, and priced as of close of the market on Friday, and it's a sea of green. And you have to ask yourself a question, as I've been saying, and it sounds like a broken record. We've got two things going on that we haven't seen before. We've got the biggest oil crisis, energy crisis ever. I'm not talking about in the last 10 years ever, and we've got the highest trade tariffs in the US since the 1940s, and yet we've got US markets at all-time highs. Well, it's SP 500 at all-time highs, okay? Uh, actually up for the year. If you look at the SP 500, up four percent year date. And that is really uh kind of telling about number one, the market is looking through geopolitics as it always has, and number two, there's definitely an economic disconnect. There's an economic disconnect somewhere. Is it AI? Uh is it the economy? Some structural issue with the economy that is making it less connected to uh markets. I'm not sure. Um, but there's some rich pricing data obviously in uh this macro pulse that would be sent to you. Looking then at bond yields, we can also see we've got global bond markets, and again, as we would expect on Friday, we saw yields fall, bond yields fall, and we saw oil fall. Obviously, we'll look at commodities in a second. So, previous during the turmoil, we had bond yields repricing because they're priced off interest rate in expectations, inflation expectations. And if there's going to be a commodity shock, if oil prices are going to rally higher, you're going to see uh a reluctance on central banks to uh cut interest rates, and the bond market is going to reprice on that. That's why we saw yields higher. Interesting to look at if I zoom in a bit, the European experience of bond yields. Looking at the the difference between what you might call the more stable, more secure uh European bond market, the likes of the northern European countries, there is a premium being priced in to European sovereign bonds at the moment, as you would expect. You've got the northern European countries, Austria, Belgium, Denmark, uh maybe hovering around three high twos, and then you've got uh France, obviously, huge uh debt problems, total debt very large. Um, we can see Hungary, we'll talk about Hungary shortly. Um Italy, 3.7%, France. Okay, so you've seen that bit of a premium price then, and bond yields. We're you it's important to keep an eye on uh European sovereign bond yields in terms of what markets are going to price in uh to with all this uh global uncertainty. Oil prices, commodities, the key commodities to look at. Uh we saw a fall in oil prices, expect oil prices to rally again uh given you know we've had a bit of a breakdown. Gold is having a good recovery. We said that, we said that um gold had uh gone up too fast too soon, and it's moving fair a fair clip now at the moment as well. But you know, it's all maybe this is just speculation, but gold this is not advice, I should say, this is information and education, infotainment, I think they call it. Uh, but gold is interesting if you're looking at it in the context of a portfolio diversifier, uh, but you really need to be careful because gold is volatile, as I said with my interview with Ronald Peter Stefler. Ronnie uh is an expert in gold, he he produces the In Gold Report We Trust report, and I would recommend going back looking at that. But the reason I've included other agriculture other commodities, you know, you've got industrial, agricultural commodities, because you know, agriculture a lot of people focusing in on agriculture at the moment, and you know, the nature of our global economy, the people that suffer the most are the poorest, and there is concerns, somewhat maybe alarmist about um drought, uh food, huge food shortages arising from this energy crisis, but there's definitely concerns uh in relation to this. In terms of the chart, you can't ignore. I'm moving quickly because I'm already behind time. But we saw a release from the index of consumer sentiment from this is uh a survey done by the University of Michigan Consumer Sentiment. What is it? They go and survey 500 US households and they ask him a couple of questions, qualitative questions about how do you feel about the economy, what's your uh expectation, what's your confidence level with retail consumer sentiment, and the upshot of it is that it's the lowest uh reading on record. And you might look at my chart above and say, okay, well, it's that's just going back ten years, but this data series actually dates back um to the 1950s uh from from memory. So if I scroll down, see this data is coming from uh University of Michigan via the Fred database, the Federal Reserve Economic Database. And you can see going all the way back, this is the current reading, going all the way back, 1970s, never been lower, even through all previous oil crises, the 2008 financial crisis. So that really tells you something about the lack of confidence in the US. Remember, the US economy is predominantly a consumer-based economy, so you would have to worry about that. The other chart I couldn't refuse putting this up, the great disconnect. Remember earlier I spoke about how this SP 500 is just looking through what's going on in the globe, what's going on in the US economy? So the blue line is the SP 500, just that march higher, and whereas the green line is US job opening. So we can see US job opening starting to trend significantly lower and a fair decent clip down, but we just see this constant march up. What is driving this? Is it something structural in the economy? Is it AI related? We know that uh AI saved the day uh in last year's market, but is there something where productivity gains, concentration of wealth in corporates, and the uh worker is going to lose out eventually? That is going to have implications for inequality, something that's already a serious problem. Now, market insight, moving on, we talk about private credit. Private credit has been in the news an awful lot lately, and there has been some concerns about is it a systemic risk? What's the issue? First of all, what is it? It's non-bank lending, and you could say non-bond market lending. So typically, when a company needs to raise debt, they may go to the corporate bond market uh or they may go to a bank. Uh so this is a situation where post the financial crisis in 2008, we got a situation where the banks were in dire straits, government bailouts, etc., QE, and you had banks, a combination of banks being reluctant to lend, and also companies not looking for cash, trying to deleverage. Well, you had a new player step into the to the breach in terms of private lending, and that's where companies, large asset managers, so-called shadow banking, started lending to these mid-sized companies. Okay, that all sounds pretty fine and well, but what you have is when you have a private, unlike publicly listed instruments, private is a bit more opaque, you don't know what the uh terms are, you're unsure of the credit quality of the borrowers, etc. etc. And who owns uh a lot of uh these loans. Now, so so the situation is that everything was going fine, uh the the the sector had grown enormously post the uh pandemic. The the most famous example of this was the uh firm Blue Owl, uh, which has a number of these private credit funds, assets under management grew from 50 billion to 300 billion in in four to five years. So phenomenal growth, and anything that grows that quickly is always gonna uh there's always gonna be concerns about you know underwriting, quality, loan quality, that type of thing. So the situation is that there was claims on redemption claims where basically uh investors wanted their funds back, and uh given the scale and quantity of the claims, a lot of these companies uh started to put gates or redemptions moratoriums on client funds taken. Now, this is the old story in in markets. If investors require compensation above the risk rate, there's a trade-off. The trade-off is going to be perhaps liquidity. Maybe you can't get all your money out when you want. Also, you have to realize most of the some of these investors, sophisticated investors, institutional type investors, they're going into this stuff with their eyes wide open. The problem was, from my reading of the situation, this expanded out into more retail investors. That's a bit more flighty, uh, a bit more nervous. Uh, in uh, if there is a stressed environment, which we had with the energy crisis, uh using in a crisis, you don't sell what you want, you sell what you can. So, again, it's not a good look when you get uh institutions telling investors you can't have your money, right? So, what we can see is that the scale of the redemptions, something like uh 20 billion redemptions over a short enough period of time. Big players like Cliffwater, Blue Owl, uh, what this chart shows is that uh the redemptions honored versus the unmet redemption. So the likes of uh BlackRock, uh I think Blackstone, I'm not sure. BlackRock definitely um just gave all their gave all the money back to investors. Uh Oak Tree, for example, was another one, but then the likes of Apollo, Arez, um Blackstone Blackstone actually gave the money back as well, but Blue Owl had redemptions of over four billion, and I think approximately twenty-five percent of those have been met with the others then into some type of moratorium. So the bottom line here is from looking at the pie chart above whether this is systemic, the question of whether something like this is systemic is what is the exposure of the systemically important banks, those big commercial banks, to this sector, and it's low. It looks like loans to private equity funds, private credit is around three percent each. So most most of most of the banks have learnt their lesson regular uh post-financial crisis, and most of their asset books, their loans is commercial real estate. Again, that could be a problem, but uh uh residential real estate loans, commercial industrial loans. But the sector exposure to uh private credit appears to be low. Now, who am I? I'm not I'm not an expert in this, and you need to do your own homework on this, but based on what I'm looking at, it looks like this could be contained, but it definitely is gonna have an impact on sentiment. Uh, one person's asset, another person's liability. You get write downs, you get defaults, you're gonna have ripples, and you know, definitely gonna add to uh a negative market when it already doesn't need an excuse to probably sell off. Moving along, we're looking at the voice of reason this week is talking about geopolitics. This is a quote from Eswar Prasad, Professor Eswar Prasad. Uh, he has a new book out, uh put a link to this uh the Doom Loop. Sound sounds really uplifting, doesn't it, for a Sunday evening, Monday morning. But Eswar Prasad is a serious player, Professor Cornell, a senior fellow at the Brooking Institute, and his quote is but the harsh reality of our imperfect world is that the absence of a dominant currency. Would risk making bad situations worse. Those who seek regime change should be careful what they wish for. This is really in the context of the book. And I I saw a recent interview with Professor Prasad and he talked about he initially started writing the book as a positive story, but ended up when he actually started looking and reading, uh realized that it's it's far from positive and it is negative. It's it's worrying. Um he talks about the 1990s, we had the unipolar world. This is where the US emerged uh following the collapse of the Soviet Union, the fall of the Berlin Wall, as I mentioned earlier, and for most of the 1990s, the noughties, the US was the dominant power from an economic, a financial, and a military perspective. Today it's much more evenly distributed in terms of economic power. So the original idea of his book was that he would have he thought of this period, yes, we're in a state of flux, yes, we've got populist politics, but trade wars, um, deglobalization. But the view was that this was perhaps a transition period of instability and temporary and was only temporary in nature. But based on his readings and his research, he identified a number of headings that have led him to the conclusion that it's much more serious than that and it is potentially a negative feedback loop or a doom loop. What is it? What is the doom loop? It's the combination of economics, domestic politics, and geopolitics creating this negative feedback loop. How? Okay, so we all know about globalization. What was it? It was perceived this positive thing where countries would cooperate on trade, and he frames this in the terms of a positive sum versus a zero uh sum game. Globalization was seen as this positive thing where uh other countries would compete with each other, as I said, trade or trade with each other, but natural competition would be good, good for the consumer, good for uh perhaps global equality, etc. etc. But as I've said in previous interviews with the likes of Louis Vincent Gav and a lot of other people, that China's ascension to the WTO in 2001 laid the groundwork for the likes of Trump, laid the groundwork for politicians like uh Nigel Farage, Marie Le Pen, I could go on and on and on, Victor Orban who lost his uh seat, uh lost his position in power last week. So but this leads to this politics of resentment or othering economics infected by domestic. So what so what is if we look at the US, and this can be mirrored across the world really, if we look at the United States, hollowing out of the middle class in the US, the export of all those manufacturing jobs, this has led to a crisis in domestic politics in the US, the emergence of Trump, that has fed into politics into economics, which has then fed into geopolitics. And we can see this, uh CP, what do you mean? We can see look at look at the post-World War II institutions such as the World Bank, the IMF, look at the E look at the UN, look how weak that looks today. And we see these other institutions, the uh Asian Infrastructure Investment Bank, I think it is, National Development Bank, uh, and these are these are Asian banks, the Asian in uh institutions that are that were created perhaps to challenge the Western uh influence. Because we know so much of the United States influence is structural in nature, vetoes of 17% when you need an 85% majority. This stuff, you know, but the the paradox that he talks about is that a lot of the these a lot of these uh new institutions have the same level of control from China this time as opposed to the US. So there is a bit of a contradiction there. He talked about two speeches uh at Davos this year. Trump's speech was this pre rambling nonsense, uh divisive, and we had Mark Carney, who uh is very impressive, obviously, uh you know, clever guy, uh former central banker, knows his brief, but he spoke about the middle powers and how it's up to the middle powers to perhaps uh be a guiding light and uh but use a pragmatism more practical, pragmatic form of politics. And he had a negative view on technology as a destructive force uh in terms of creating mistrust and it wasn't really uh a very I I have the book, I haven't read it yet, but it wasn't really a very uplifting um picture he painted. But it's time really we took the blinkers off. I think it's time we realize that it is uh it is a very precarious position that we're in. This week on the podcast we have, as I said, Professor Dunka O'Bakoin and a fascinating interview. He's a leading Irish scholar of post-Soviet politics, international relations. He's known for his incisive analysis of Russia's influence across its near abroad. That near abroad is a special uh term which we talk about. He's based in Dublin City University, serves senior roles within the School of Law and Government. His work combines rigorous field research with a keen eye for the political dynamics of contested and unrecognized states. And his particular form of his research focused on Eurasian geopolitics, democratic backsliding, and the complex realities of de facto states. So he's very recognizable for people uh you know, he appears regularly on TV, beyond academia. Uh Obakoin is a regular voice in public debate, offering measured authoritative commentary. So Donica has lived in Central Europe, uh, you know, lived in these far-off places, Uzbekistan uh lived in Georgia pre-the-war there. So he's a real credible vice, and I was very keen to speak with him, and I hope you find the interview useful uh or and interesting. Now, this is my uh attempt at a bit of humor. There's just one more thing. So if anybody who remembers of a certain age, um the detective Columbo, just when people thought they were out the door and they were got away with it, uh Frank, I think Frank was his name, Columbo, would say uh just one more thing. And we one more thing this week is the end of Victor. So Victor Orban has left the room. In fairness to him, he left uh he he left without a fight, uh uh, unlike others, other more autocratic leaders, you could say. Um but anyway, he's gone. Uh Peter Magar uh is the new man, and there's a lot of optimism about this guy, but me and my half my glass half-empty hat. Uh we have to look at the other side of it. This guy was in Orban's party uh just two years ago. He's a bleeding heart liberal, he definitely is not, he's a nationalist, and we have to see what he does. Now uh Van der Leyen, uh Ursula von der Leyen has said that there's you know EU funds ready to go there if he plays ball on unlocking that 90 billion for Ukraine, which he's expected to do. But how's this gonna play out with with Russia? Now we know, and this is two points I would make, the counter-argument, Hungary is very reliant on Russian energy. So how's that gonna play out? And also I have written here who will who will now be Europe's mudguard. Orban was a controversial guy, but he did act as a mudguard for anybody that was say under the radar in their less uh enthusiastic support for Ukraine and the funds that were going there. So this may in a kind of a strange way uh reveal some objection to all to the support for Ukraine uh in Europe. Maybe, maybe not. In terms of what to watch this week, this is our uh economic calendar uh looking at I talked about the consumer. Uh we've got March retail sales uh in the US on Tuesday. Uh we've got the Fed hearing, I think that's Wednesday and Tuesday or Wednesday, the new Fed share. Be interesting to hear uh what he's what he speaks about in terms of Fed independence, initial jobless claims, and we've got the March and that Michigan consumer sentiment. So we do expect these to be uh under pressure, obviously, because the uh March should capture some of that negative uh feedback from the war in Iran. So they're the main bits of uh economic news to look at. What I'll say in terms of finishing this out, as you know, there's there's a there's a significant amount of time and effort obviously that goes into producing the podcast. We really hope that you're finding value from it, and we would appreciate uh your support. How you support it is by giving us a rating on Spotify or Apple Podcasts. Uh the algorithm, the way algorithms are, the higher the rating, the you know, the higher up the the chat the rankings you go and allows us to reach out to uh bigger and and better guests for you. So we appreciate every every rating. Um the website is there. Uh I would strongly recommend subscribing. Subscribe for free. Uh we'll send the weekly research. Uh there's going to be lots more to come. And please reach out as well if you've got any guest suggestions that you have uh or if you have any recommendations. I should say, and this is important, all the information that I give here, that we give on this podcast, is uh for educational purposes and for information purposes only. It's not to be construed as financial advice. Please speak with your financial advisor, your tax advisor, uh your investment advisor, certified financial advisor, whoever that is, because they are the person that are aware of your unique circumstances. I do run a wealth management firm and the managing director of a wealth management firm in Dublin. So for Irish-based investors, delighted to speak with you or to help you if I can. So anybody else that is consuming this content, speak to your own advisor. Okay, so that's enough for me this week. If I want to leave you with some more words from Professor Dunico Bakcoin. Hope you enjoy it and stay tuned. But looking at perhaps a bright spark, we had what we would describe as the illiberal democracy of Viktor Orban in in Hungary. And we're recording this on the 17th of April. And we were a week since Peter Magarth won the election in Hungary, his TISA party. But what struck for me was that there was a huge turnout, 80%, something like 80% turnout, number one, which was really impressive. And number two was the scale of his victory. So there's two things that jumped out for me. What's your reading of it?

SPEAKER_00 33:19

Yeah, I mean, obviously it was the result that we were hoping for in a two-horse race. Nobody, uh, I think in in Democratic Europe wanted to see Victor Orban returned for another term. But I wouldn't be as optimistic and euphoric as many of the commentators and political leaders have been. I mean, Peter Magier is is is not a liberal opposition figure in the traditional sense. He joined Fidej Orban's party when he was twenty-one. He has spent his entire adult life a member of Fidej. He left it only two years ago. So his his political maturity was very much and and l and loyalty and he thrived in Fidej. I think that he probably made a rational assessment of his prospects within Fidej. Uh I can't speak about his, I guess, personal motivations with any degree of conviction. He's still a largely unknown quantity. His own objectives are quite uh modest. So, for example, I think he'll remove the veto that Hungary uh had applied to the ninety billion package going to Ukraine. I mean, that's the least that could be expected. But Hungary won't contribute or participate uh in that uh alone itself. He, on many fundamentals, is uh at one with Orban, for example, on things like migration. He's talking about, of course, uh reversing some of those democratic that democratic backsliding that had occurred under Viktor Orban. Of course, that's in his own interests. For example, he gave a speech on state television last night or the other night, uh, where he more or less said that state television was going to be completely reformed, it was fake news essentially, and that it had been conspiring against him, it was like North Korea. You know, that's great to hear because state television was indeed a propagandistic tool of the regime, but at the same time it's also in his interests to to reform it in that way. So I I don't see him as kind of like a major icon of the democratic movement. I think we're we are still in a very precarious situation. We have many uh mini trunks in Europe, and they are, you know, Russia has been supporting them for many years, financially, politically, diplomatically, and now we have a US administration which is reaching out to uh like for example, Alternative for Deutschland in Germany, the the the very far right party, and and of course they tried to help Orban. That was one of the the silver linings. But just going back to the election result just briefly, I think also that uh we can't underestimate that people want to change after sixteen years, and uh that it was uh natural that they would look for an alternative that you know wasn't a huge risk, but wasn't more of the same. Uh but uh the global picture is is still rather dark. The European picture is rather dark because we've seen the damage that a country like Hungary can inflict on the European Union project by the use of the veto. In my book, for example, I g I give the salutary lesson of the Polish-Lithuanian Commonwealth of the 18th century. Uh this was you know a very powerful regime uh stretching from the Baltic Sea almost to the Black Sea, and they had a very democratic, for its time, uh political system which allowed a veto for any parliamentarian in the same, which was the name of the parliament. And and what happened was, of course, is that the Russians began to buy individual parliamentarians, the Prussians also, but the Russians were particularly good at it, and they would veto the legislation and it paralyzed the Polish Lithuanian Commonwealth. And then through a number of annexations in the late 18th century, the Polish Lithuanian Commonwealth was no more. It was divided up between the rival uh dictatorships, the the empires, the Prussians, the the Austro-Hungarians, and the Russians. Now, the European Union, you know, with this kind of need for unanimity and consensus, surrounded by Trump's US, Putin's Russia, and of course Xi's China in the background, you know, will have to consolidate. I mean, there's a lot of power in Europe, but I think there's not a lot of confidence.