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Cathie Wood isn’t worried about inflation impacting ARK tech bets

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Yahoo Finance Live’s Brian Sozzi discusses the reasons why Cathie Wood isn’t worried about inflation derailing ARK's tech innovation holdings.

Video Transcript


- Cathie Wood for one not worried about inflation affecting her investing thesis. In an interview with Goldman Sachs, Wood said, quote, "We are on the other side of the inflation problem." Her hot take is where we find Sozzi's hot take in reaction to her hot take.

BRIAN SOZZI: My hot take is this. Let me just turn my head to the side because that's like, really, that's my vibe off of this and hat tip to Goldman Sachs. This is really a long, extensive interview with Cathie Wood. I have a full written piece on this one on the Yahoo! Finance home page now, but I'll hit the high points.

What is not, she says, overly concerned about inflation and as she views deflation. She thinks inflation is now past its peak and she sees deflationary forces starting to take hold. Not sure where, but if she is watching this and knows where to find it, please do let us know.

And then last, she really fought back against a lot of the critics out there. I mean, Cathie Wood rose to fame in 2020, 2021 with strong performance for ARK Innovation ETF and with that popularity comes a lot of critics on Twitter and in various media forums. She says, look, these criticisms are good because they suggest a lot of negative news is priced into her stocks.

Now she owns some of the buzziest tech names out there. The Teladoc stock has went right down the drain year to date. Tesla's been under pressure, Zoom under pressure, Roku been under pressure, but Cathie Wood sees this negativity as now being potentially priced into her portfolio. And you see right there in the screen into some of her top holdings. My take is very simple, perhaps unsurprising giving my tone around this.

Really, Cathie. Really, I look-- I love talking to Cathie Wood. She's been on this many times. I think she's abs-- I think she's brilliant. She, of course, knows what she's talking about, but her portfolio has been obliterated this year. And in large part, that is because of I think changes to Fed policy, but also more changes to policy that are coming down the line and you have to at least, I would think, acknowledge that this has happened. You can't live in your own world.

- She's acknowledged it. She's definitely acknowledge it, but she also has a three to--

BRIAN SOZZI: Well, you talked to her in April, right?

- She also has a three to five year time horizon so when-- yeah, it's anyway. We won't go-- we don't need to go full deeply into it.

- So on a three to five year time horizon then, where does some of that innovation start to net out? Because you still need the capitalization for those companies to make it through this wave as well in order to have a pathway to profitability or just operations.

BRIAN SOZZI: Well, here-- let's use Coinbase because Coinbase is the name that she's been buying. This week they laid off, or they announced they're laying off 18% of the workforce, what does that do for the culture inside of Coinbase? And then if that does impact the culture, what does that do to the longer term outlook for Coinbase, their innovation cycle? Where are they in five years? Unclear. Unclear.