August 19, 2019—US 30-Year Bond Falls Below 2% For The First Time Ever While Other Countries’ Yields Go Negative. Why Are Interest Rates Falling?
Office Space Company WeWork Unveils Paperwork For its IPO. How Do Its Financials Look?
CBS Announces $30 Billion Merger With Former Subsidiary Viacom. What Was The Strategic Rationale?
U.S. Looks To De-escalate Trade War With China As it Delays Some Tariffs On Chinese Goods. What Is Their Strategy?
Air Canada Raises Its Friendly Offer For Transat By 38% From $520 Million to $720 Million. Why The Massive Increase In Purchase Price?
Welcome investors to the Absolute Return Podcast. Your source for stock market analysis, global macro musings and hedge fund investment strategies. Your hosts Julian Klymochko and Michael Kesslering aim to bring you the knowledge and analysis you need to become a more intelligent and wealthier investor. This episode is brought to you by accelerate financial technologies. Accelerate because performance matters. Find out more at www.Accelerateshares.Com.
Julian Klymochko: Welcome, ladies and gents, to episode 27 of The Absolute Return Podcast. I am your host, Julian Klymochko.
Michael Kesslering: And I am Michael Kesslering.
Julian Klymochko: Today is Saturday, August 17th. A lovely day out there, but we got a lot to touch on this week in the markets. It was a real volatile week. On Wednesday, we had the biggest drop in the markets of the year. Dow was down 800 points, but we had a lot of volatility and S&P finished down like 1 percent, so you had a lot of ups and downs. Argentina’s main market crashed nearly 50 percent on Monday on some political issues going on there. But what we’re going to touch on this week, off the top.
- Interest rates. The U.S. 30 year bond fell below 2 percent for the first time ever, and other countries, yields are going negative. Why are rates falling? And what is going on here?
- Some IPO news. Office Space Company WeWork unveils IPO paperwork for its IPO. We are going to chat about its financial position and its financial performance. In addition to what we view as egregious corporate governance.
- New deal in the M&A space, CBS announced a 30 billion merger with former subsidiary Viacom. We are going to chat about the strategic rationale and some history behind that deal.
- Quick update on the trade war as U.S. looks to de-escalate this trade war with China as it delayed some of the tariffs on Chinese goods this week. What is the strategy behind that?
- Lastly, quick M&A update on Air Canada Transat deal and what happened there.
Want to touch on some interest rate news here. As the U.S., 30-year bond fell below 2 percent. The yield on it for the first time ever, and a lot of other yields throughout the world, especially in Europe and Japan, they are crashing through zero, going to negative. There has been a substantial rally in government bond prices, as you know. Prices move opposite of yields, and so yields have just been plummeting as investors rush to the safety of government bonds getting pricier and pricier, leading to lower and lower and now negative U.S. yields going below 2 percent for the first time now. What this did is it drove 10-year U.S. yields below that of the two-year yield, now this is known as an inversion. The reason why this is important is that an inverted yield curve is probably the most recognized recession indicator and everyone knows about it. Everyone pays attention to it. When either the 10-year yield drops below the 2 year or the 10-year yield drops below the three-month Treasury yield, that’s a big warning sign to all investors that, hey heads up a potential recession is could be happening in the near term. We want to express some caution around those thoughts because markets tend to keep moving higher immediately following a yield curve inversion. We have some precedents here of past yield curve inversion. Since 1978, the S&P 500 has actually risen 13 percent on average from the first time. The spread inverts on a closing basis to the beginning of a recession.
Some average performance of the S&P 500 following an inversion of the 10 and two-year Treasury yields, which just happened this past week. S&P 500 performance in the next three months is positive, 3 percent on average of six months, positive, 5 percent one year out. It is about 13 and a half percent. Two years out, 15 percent. Finally, three years out, 17 percent. Those are all positive figures.
We really just want to caution investors regarding, you know, freaking out, and selling everything here. When this inversion happened on Wednesday, the Dow tanked 800 points and its biggest drop of the year, so market is really freaking out about this. You know, it is obviously something you want to be wary of, something you got to be concerned about. If you are concerned about a recession hitting and your stocks tanking 20, 30, 40 percent, and then perhaps you should take a good look at your asset allocation. Make sure that you are comfortable with, but what are your thoughts. On the real rally and safe haven bond prices causing yields to tank and the 10 minus two-year Treasury yield inverted?
Michael Kesslering: Yeah, with regards to the yield curve inversion, is that what matters? Is not the fact that it inverts is that, as you mentioned, is not really that great of an indicator, but what to look for is how long it inverts for as the duration that it inverts for does matter a lot. And in this example, as was a couple of months ago, when it inverted before is it just immediately bounced back again the next day and bounced off the bottom. Although there still is not much of a spread, it still is not inverted anymore, and one other thing that we had discussed in the past was that this actually is not that good of an indicator elsewhere outside of the U.S. A good example of that is in the U.K. is that their yield curve is inverted currently as well. But it’s not as strong of an indicator as in the U.S. And keep in mind that both in the U.S. and in the U.K. as well as across globally, there is a lot of quantitative easing going on that really distorts the read through that you can have on any signal of the yield curve. It just distorts the actual mechanics of a yield curve.
Julian Klymochko: Right, and that quantitative easing, what central banks are doing, they are actually going out into the market, buying bonds to push yields lower. One thing to think about is, is the yield curve such a reliable indicator as it used to be when back then, you did not have all the central bank intervention, but now you have central banks going out, buying bonds, pushing those yields down. And so is this inversion being caused on the long end of the curve by all that central bank buying?
Michael Kesslering: Yeah, and just a stat for that in particular to the U.K. is the Bank of England actually owns about 33 percent of all gilt. Which is a higher proportion than both the Fed and ECB for their respective jurisdictions. That is just a lot of manipulation that is going on within that yield curve, so it really takes away from any way that you can use it as an indicator right now.
Julian Klymochko: Yeah, and you mentioned other yield curve inversions globally. I mean, it has been completely useless as an indicator in Japan. I know in Canada there, has been a number of false alarms where the yield curve did invert and we did not have a recession. That has happened a number of times. Have some additional data points here on market action around an inversion. The biggest S&P 500 increase three years following the start of an inverted yield curve was tied to a December 9th, 1988 inversion. Now, in this scenario, the S&P continued to post gains and three years later, it ended up almost thirty-seven percent higher. So by no means is this like a real solid indicator. But what its saying is, you know, look, be cautious out there. You know, don’t be levered long or perhaps just be really comfortable being in the market long term. Right, because this does, as we saw this week, lead to some near-term volatility. Now, looking back at the 10-yield curve inversions, back to 1956. The S&P continued to go up, but topped out within approximately three months of the inversion six times. Then the S&P 500 took eleven to twenty two months to peak after the other four inversions.
Getting back on to the Central Bank topic. Now the Fed is getting the blame for this recession, warning more so on the short end of the curve. Some view it as a policy mistake in terms of them raising rates too aggressively last year or perhaps not aggressively cutting enough when they got back into an easing cycle just last month. It is a really interesting thing to look at, not just the Fed, but I mean, more than 20 central banks globally are now easing interest rates and cutting rates around the world. It is really a trend that we are seeing globally is rates declining yield curve inverting. And what’s that saying is that markets are expecting a slowdown.
Michael Kesslering: And one thing that we were talking about off line with regards to the absolute level of interest rates over the last number of years. Is that over the last few decades for macro hedge funds, one of the most popular trades and most successful trades has been long duration, just a very simple long duration, so that’s also been interesting.
Julian Klymochko: Right, so many macro funds are doing very well this year by being very long of bonds, as you said, being long duration, long 30 year bonds, which rally significantly as the yields decline. I saw Austria has a 100-year bond, which is crazy in itself, but the yield has declined all the way down to near 1 percent and that bond is up about 75 percent year to date.
So the joke is that you now invest in stocks for income and bonds for capital gains because you’re seeing crazy moves out there. I view it as you are kind of on a razor’s edge because at this point, with yields so low. Just cause tremendous volatility in the bond price, and I believe in my opinion, consensus view is that U.S. yields may go down to zero or even negative, follow Europe and follow Japan. That seems to be the consensus view. If you take into the case where yields go up. I mean, 30 years ago, you got the 30 year at 2 percent now, but 30 years ago is at 9 percent. So a lot can happen over 30 years. If yields start to go out, those bond prices are going to plummet. Nonetheless, the craziest thing that I see nowadays is now 16 trillion of debt globally has negative yields. That is not just on a real basis, but also on a nominal basis. You have to pay Central Banks and even Corporations to hold your money, so it is just madness out there.
Speaking of madness, we got some big IPO news this week. When office space company WeWork. They unveiled the paperwork for its IPO, which could happen as soon as next month to make their official debut in the public markets. WeWork released its much-anticipated prospectus for its upcoming initial public offering, some financial performance. The company reported a net loss of nearly one billion for the first six months of the year, which is just crazy. They are racking up an insane amount of negative profit or losses. The WeWork IPO could happen as soon as next month and it is expected to raise approximately three to four billion dollars, one of the biggest IPOs of the year, certainly. It was recently valued in the private markets as high as forty seven billion after Softbank, the big Japanese conglomerate who runs a vision fund. A massive hundred billion dollar venture capital fund. Softbank is the biggest backer of we were; they invested an additional 2 billion dollars in the private market financing back in January. Now, what WeWork does there, they are a 9-year-old real estate company that rents long-term real estate, commercial real estate, renovate it, and divides it into like small offices and sublease it to say entrepreneurs or anyone else looking to have a little office space and that sort of environment. Since its founding nine years ago, it has raised almost thirteen point four billion, largely from Softbank vision fund. Couple of highlights of the IPO filing, their membership base has grown by triple digits over 100 percent every year since 2014. It took them seven years to achieve one–billion-run rate revenue, but then only one additional year to reach 2 billion, 6 month to reach 3 billion and run rate annual revenue. Got about 520 Offices across one hundred and eleven cities globally. Another interesting aspect of the filing, it details that the CEO and his wife, who also works for the company, which is a bit sketchy in my opinion. They promised to donate 1 billion to charitable causes, which is pretty noble of them. That is some lowlights of which I believe there are many here. Many sort of things that make you scratch your head or
Michael Kesslering: Red flags.
Julian Klymochko: Definitely red flags. The filing details hundreds of millions of dollars of real estate deals and personal loans involving WeWork and its CEO, Adam Neumann, in addition to his super voting status and a big bonus tied to taking the company public. He can cash in even more. I mean, his stake is worth billions of dollars here and he’s cashed out a lot, but he can make even more money on top of what he has. If the company does well in its IPO, the other huge red flag that I see is that CEO Adam Neumann, who actually acquired a bunch of real estate privately himself, in which he then goes and leases back to WeWork, which is obviously a huge conflict of interest. He also has a credit line of up to half a billion dollars. That’s five hundred million dollars pledged by his WeWork shares. As we have seen, this can be probably problematic. One example of this, where a CEO is levered to the hilt on margin loans tied to the stock was Valeant Pharmaceuticals. I know Michael Pearson got blown out of a lot of stock as it tanked and he faced margin calls and the banks backing that loan or forced to sell the shares into a declining market. The last thing I wanted to flag is that a multiple of the CEO’s family members also worked for the company. There is a lot of red flags to be very, very wary about this upcoming IPO. What are your thoughts on the WeWork filing here?
Michael Kesslering: So first, I will just add a couple more red flags, and then I will get a bit into the fundamentals. As well, the founders did acquire the We company trademark as WeWork has now rebranded to we company. They acquired that trademark prior to the company’s rebranding. Then the company paid the founders five point nine million dollars for the trademark, which is just optically, it is not a material amount for WeWork in terms their valuation. Their last valuation was forty seven billion. That is not a material amount, if Adam Neumann needed six million dollars; they could very easily just structured a bonus plan or something of that sort.
Julian Klymochko: Yeah, that is just greasy and I mean he trademarks The We Company. It is not like that was a different business. It was clearly for WeWork, no other reason.
Michael Kesslering: Yeah, and if he was an individual that wasn’t a part of the company and WeWork sued for that, this trademark would likely get thrown out in court as it would just be clear, trademark trolling, so I found that interesting. As well J.P. Morgan, the leader of the IPO or the elite underwriter in the IPO is the lead bank on his personal loan. There is a bit of a conflict of interest there as well, but getting into the unit economics, their actual united economics are trending in the wrong direction. Their costs per member are increasing at a high double-digit rate, while their revenue per member is actually decreasing. They have a 10 percent contribution margin, but they plan to grow that to a 30 percent contribution margin, which in their line of business is just think of it as really like their unit level margins taking out the GNA. Subtracting OpEx, but this is reliant on them increasing their occupancy from 87 percent where it was 83 percent a couple of years ago to one hundred percent.
Julian Klymochko: That is crazy.
Michael Kesslering: Which is just obviously impossible, but as well. When they are discussing the revenue per member decline, they do mention that this is due to them expanding into lower price point cities. However, that only makes sense if their costs are declining as well. As well, just on that on that topic, it is unlikely for them to continue to increase their contribution margin to the point where it’s up to 30 percent when they’re moving to a lower price point cities. By definition, lower revenue and getting up to 100 percent occupancy is just very unlikely as well.
A couple other things I wanted to bring up was just on trading dynamics and how this IPO will be priced, is the company did sign already. They signed a commitment letter with their banks for six billion dollars in additional debt financing. Now that is contingent on them raising three billion dollars in the IPO. The price dynamics of this will likely be that they are not very sensitive to price, that they just need to make sure that they raise three billion dollars. So that forty seven billion dollar valuation that they last raised at, their IPO valuation will likely be substantially lower than that. That is interesting, throughout the S-1, their growth is kind of like a result of other tech companies growth as there is a number of popular tech companies that lease from WeWork. Think of like Slack, Lyft, and Salesforce. They all use WeWork, so you could almost think of WeWork as like a second derivative of the overall tech industry growth. The problem is that as some of these companies grow and become larger customers of WeWork that increases their bargaining power with WeWork. The likelihood that they are actually looking at a reduction in revenue per member from those large companies. I think that is a very realistic scenario, so overall looking at the company and just the dynamics of this IPO and all of the red flags, it really just seems like something to avoid.
Julian Klymochko: Yeah, it makes you think the company has been around for nine years and they take out these long-term leases and then rent them out on a short-term basis. They never actually been through a recession. You talking about current occupancy, well how are things going to happen? How is that occupancy going to look when the economy goes into a decline and recession and people don’t have the money to spend on office space. Instead, they go to their basement or they go to a coffee shop, instead of renting that WeWork. That is something to consider as they are booking massive losses like a billion dollar loss in a very good economy with relatively high occupancy rates. How are things going to turn when the economy is not doing so well? So you got to think about the potential sustainability of this business. The other thing is, in my opinion, no competitive advantage. We are seeing so many copycats come to the market with the exact same offering, you know, short-term office space.
Michael Kesslering: There is plenty in Calgary.
Julian Klymochko: Oh, certainly, and any other big city you go to, there is so many of these. The other thing you touched on, the valuation is just insane like 46-47 billion. Although you did mention the IPO, it is going to be lower, but at the end of the day, this is a real estate company. Masquerading as a technology company, but you look at the economics and there is like nothing technological about it. They are just booking massive losses. Sure, they are growing pretty significantly, but anyone can grow selling a dollar for 50 cents. The last thing I wanted to mention is just the egregious corporate governance here. It is definitely something to be cautious on and we would definitely warn investors against participating in this IPO. Like say more red flags than a Chinese communist parade, so like I say, be cautious on WeWork IPO. But it’ll be an interesting one to watch.
Big news in the M&A space with media companies CBS and Viacom. They are once part of the same company. They again agreed to merge in a 30 billion dollar deal. Under the deal’s terms, Viacom shareholders are going to receive zero point six shares of CBS. So an all share deal, no cash involved. CBS has a market cap of 18 billion; Viacom has a market cap of 12 billion. Combined they will be a 30 billion dollar media behemoth. I mean, they will have the largest market share in U.S. television, 22 percent and combined revenue of 28 billion dollars. Some background on the companies. CBS owns the CBS television network obviously, CBS News, a bunch of TV stations throughout major markets in the U.S. as well they also own the Showtime and the Publisher, Simon and Schuster. Now, Viacom, they own a bunch of different properties. Basically BET one of the big ones, Comedy Central and MTV, along with the movie studio Paramount.
Interesting history between these two companies. Now, Viacom and CBS first merged in 1999 during the dot com bubble, and that deal was valued at thirty five point six billion at the time. Now, 20 years later, they are merging at 30 billion. There has been actually six billion in value destroyed over those 20 years, and after that deal, the company split in 2005. Now, 14 years later, they are re-joining again. Since 2005, Viacom shares have been flat, no performance in the stock market from Viacom shares. They certainly have been struggling. What are your thoughts on this deal here?
Michael Kesslering: At first, I would like to point out that there are some Viacom shareholders that are a little bit disgruntled because of the no premium in this merger that was given to Viacom shareholders. One of the obvious reasons for this is that the Redstone family owns 79 percent and 80 percent of CBS and Viacom, respectively, and the family has agreed to vote in favour of the deal as they are controlling everything in this company and deal.
Julian Klymochko: Yes, so it is pretty much a done deal.
Michael Kesslering: Absolutely, and the other thing I would like to bring out. Is that the deal is actually being done at an expected a forward EBITDA multiple of seven times. Just for context, in 2017, they were trading at almost 10 times. This is kind of in the lower range of that historical valuation, but the other thing to keep in mind, as you had alluded to, is that their business is deteriorating substantially. During that same timeframe, they started that timeframe with an 18 billion dollar market cap. Now they are at 11 billion dollar market cap, so there has been a lot of value destruction.
Julian Klymochko: Right, especially Viacom is so reliant on cable TV. As we know, consumers are cutting the cord. They are going to streaming, which we have talked about a lot over this many episodes in the podcasts. Viacom It has really been the poster child on the struggles of cable channels such as MTV, BET. They are seeing massive year over year declines and they have for a number of years, and you are even seeing it with Disney and ESPN. They thought that they would always have effectively infinite growth growing users every year. Now even ESPN is declining, which is why you are seeing Disney come out with a really brilliant streaming strategy. But CBS and Viacom, you know, they are struggling. They are combining to try to get through it together and perhaps get into the streaming game in the future.
Michael Kesslering: And the biggest thing is just the synergies of the deal. There is 500 million of expected synergies, so really just try to squeeze out some of that value.
Julian Klymochko: Quick update on the U.S. China trade war as the U.S. blinked this week in its trade war with China. As President, Trump announced that it would delay the latest round of tariff increases until December 15th. These were supposed to kick in, I believe, September 1st. That leaves time for items to be shipped to the U.S. ahead of the holiday rush. Trump’s strategy behind this, allegedly, was that these tariffs would not affect the Christmas holiday season. Obviously, tariffs, and he is effectively admitting that China does not pay the tariffs, as he claims, but the U.S. consumer does. A lot of these items, they include cell phones, laptops, video game consoles, computer monitors, holiday lights and some types of toys, shoes and clothing, effectively all the things that are manufactured in China. Now, U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin held discussions with Chinese vice Premier Liu He on Tuesday morning, and another call will take place in two weeks. So these parties are in continuous discussions as they have been for, you know, how long is this trade war been going on? At least a year. They continually have meetings, so there is a dialogue there. However, we are not really seeing any progress. We have a quote here from Andrew Hunter of Capital Economics. He stated that, “the three-month delay to the imposition of tariffs on more than half of the 300 billion of Chinese imports originally scheduled to take effect next month in September. It is obviously designed to avoid a politically damaging rise in consumer prices ahead of the holiday season. It should not be misinterpreted as a sign that trade tensions are easing.” Nonetheless, the S&P 500 was up one point five percent on the news for the day. What are your thoughts on this latest move by Trump in the trade war?
Michael Kesslering: Yeah, you mentioned that the S&P was up on the news as well. The news was positive for retailers for their share price, although it’s really not going to affect any of the retailers from a fundamental standpoint, perhaps if there’s any sentiment flow through that could affect them. But all the retailers had taken steps to hedge or mitigate any issues with tariffs. I believe we also mentioned that just in terms of the order cycle, they were ordering and walking in prices well before this. I would just mentioned that this is just the classic Trump strategy of a large flashy announcement and then walking it back over the next couple weeks or a couple months. And also with regards to the comments of this being in time for Christmas season, as you mentioned, completely, you know, in a way a agreeing with everybody that, yes, it’s the ultimate end customer that pays for this, but it really it’s just political rhetoric. He is already campaigning.
Julian Klymochko: Right, despite what he always says is that China is paying the tariffs. But here with this action, effectively admitting that the U.S. consumer ultimately pays the cost in terms of increased goods, these tariffs. Nonetheless, we really want to caution investors on trading, investing based on any trade war headlines. You never know what is going to happen next. One day, Trump comes out with a crazy tweet. The next day he walks it back, so it is completely unpredictable and market goes up and down on it. Ultimately, the best thing you can do, as an investor is largely ignore it. I mean take it into account, but don’t base any major asset allocation decisions on it and maintain a long term view.
This week was pretty much Christmas Day for merger arbs as Air Canada raised its friendly offer for Transat by a stunning 38 percent. They added two hundred million on top of 520 million to improve its friendly deal for Transat to seven hundred and twenty million dollars. Market leader Air Canada, they are going to buy the number three player Transat. They had previously struck a deal, a friendly deal at thirteen bucks a share, but many investors were not too happy with that price, despite it being north of 100 percent premium. Prior to the deal, Transat was trading in the six-dollar and change range. Now this improvement from 13 to 18 makes the premium well above 200 percent, which in terms of historical M&A in Canada over the past 10 years. It is definitely top 10, one of the largest and that is out of hundreds and hundreds of deals. A real Christmas present for a merger ARBs, got to be happy with that if they got a big position in it. Now with this 30 percent bump in the purchase price. They get the backing of Transat largest shareholder who controls 19 percent of the shares. Now, this shareholder indicated that they would vote against the previous deal at thirteen bucks a share.
You did hear grumblings in the market that some shareholders were looking for 15, 16 bucks a share, but to see them bump to 18 is really just a jaw dropper.
Some market action. Transat is actually trading at sixteen dollars and 63 cents, which happens to be a seven point six percent discount to the 18-dollar price, representing a nice double digit annualized return 17 percent IRR under our calculations. The reason being is that this is still a conditional deal. Investors are really concerned on the regulatory aspect. It requires approval of Transport Canada, but the big one being the anti-trust approval, the Competition Bureau and this is a real tough one because you have a combination of the number one and the number three player. That is major market power, major consolidation there, and they are going to control north of 60 percent on some airline routes, which is a huge concern from an antitrust perspective. It is really tough one to call from that perspective, which is why you’re seeing Transat trade at. Pretty, significant spread to the deal price here but nonetheless, what are your thoughts on this deal?
Michael Kesslering: First, you mentioned. That some other funds were making some grumblings about valuation. One of those funds was Pender Fund, which they owned 4 percent of Transat, and they said that they had valued Transat at fifteen dollars a share. Although they have not announced that they are in a lockup agreement to vote for the deal, I would imagine that this valuation more than appeases them. I would think that they would be on board with that as well. Well, you had mentioned the spread that the deal is trading at, and right now, the market is pricing in an 11 percent chance of deal break. So just in terms of context, when looking at the issues with Competition Canada, that is kind of, what the merger arb search are putting in here as well. I just wanted to mention Group Mach, prior to this this announced deal, they had been offering 14 dollars a share and they were looking to acquire about nineteen point five percent of the company with the goal of voting that block against the deal. I cannot really see anybody tendering their shares at 14 dollars anymore, so unless they are going to increase their consideration offered, it looks like that that is over.
Julian Klymochko: Yeah, M&A this strategy of Air Canada is known as a knockout blow. They just crushed Group Mach here. They got all their shareholders onside, and it’s a really tremendous price that honestly, no one’s going to vote against 200 percent plus premium shareholders getting eighteen dollars per share and a massive 38 percent bump on the previous agreed to 13 dollars per share deal. Yeah, Transat shareholders merger arbs got to be super happy about this one.
And that’s it for episode 27 of the Absolute Return Podcast. Hope you enjoyed it. If you did, you can check out other episodes on absolutereturnpodcast.com or any other listening app out there, whether it be Apple, Stitcher, Spotify, and YouTube. You can check us out on all other platforms. But until next week, have a good trading week and we will chat with you soon. Cheers.
Thanks for tuning in to the Absolute Return Podcast. This episode was brought to you by Accelerate Financial Technologies. Accelerate, because performance matters. Find out more at www.AccelerateShares.com. The views expressed in this podcast to the personal views of the participants and do not reflect the views of Accelerate. No aspect of this podcast constitutes investment legal or tax advice. Opinions expressed in this podcast should not be viewed as a recommendation or solicitation of an offer to buy or sell any securities or investment strategies. The information and opinions in this podcast are based on current market conditions and may fluctuate and change in the future. No representation or warranty expressed or implied is made on behalf of Accelerate as to the accuracy or completeness of the information contained in this podcast. Accelerate does not accept any liability for any direct indirect or consequential loss or damage suffered by any person as a result relying on all or any part of this podcast and any liability is expressly disclaimed.