obviously well see you still through sort of the thick of it when it comes to earnings at this point are you a little bit more optimistic than perhaps other pockets of the market that are pricing in rate cuts as we get into the end of the year good morning cautiously optimistic through this cycle trying to look through the correction thats ahead of us in the slowdown but just to reinforce aggregate earnings in the us consistently better than expected the obviously sharp slowdown versus the corresponding period last year but theres a resilience in aggregate corporate earnings and resilience in the economic data and the week by week data profile that central banks are looking at and were looking at as well as we try to be predictive of 20 20 24 earnings and credit conditions sympathetic with putting in rate cuts because inflation is doing the right thing its a little bit sticky in the core component and very difficult to get it that 3 percent level anytime soon but nevertheless sympathetic to people trying to put in rate cuts as they tried to say in evidence that they looking through the data worsening in the second half of the year and theyre saying the sharp slowdown for that to happen in their credit conditions to really sharply slowdown in north america and the private sector which may result weve just got to watch it and be data dependent again theyre pricing and credit conditions in 24 and earnings in aggregate and 24 were seeing a rough patch but not as bad as some people are flagging and have been flagging for three months george would you take a look at the markets and might see a bit more support when it comes to economic momentum is australia one of them obviously we had the return to surplus albeit it might be a fleeting one the ties to china as patchy as that recovery might look at the moment is it going to end up being favourable for australian assets at the federal level with very favourable obviously australia and china that number one trading partner having said that supplying words 70 economies in the world the number one trading partner is china its very important for us but quite clearly the energy transition lng materials metals theres going to be an alignment there and remember southeast asia has been a beneficiary very quickly of china as a day investment from china all things being equal from the trade wars into southeast asia the beneficiaries there and diversification but australia is always going to be the beneficiary and maintaining its triplea rating status its the state governments got a debt issue to be resolved and hence i got that double notch downgrade some of those out last year but at the federal level very reasonable banks are in very good shape and theyve protected the net interest margins versus american however its very difficult to make the case if youre a global fund manager to buy up banks but nevertheless they seem reasonable shape but the sovereign is in a good situation at the moment from the trading perspective george saying were trying though we do have a tech earnings starting with jb that commandant ali baba and so forth now thats been the sector thats been really pressure is this chart on the bloomberg shows our viewers are banks you talked about in australia a different picture in china they have rallied recently but i think the issue with investing in china still remains the regulatory uncertainty what is there anything you like in that market very difficult to be investing with long duration exposure into china for many different reasons that all started from the march quarter 2021 therefore what do we do we pragmatically play it by europe as rally versus a us given they are aligned to that and obviously exporters and producers into china again lng bulk commodities and metals thats how weve been playing it even with funds that have been heavily involved in china for over 20 years again since that march 21 very difficult to make the case to have long duration investments in china for what its worth they need to attract finite capital and in size in the decade ahead im not going about in the right way just yet and thats why i get weve been playing the derivatives europe and rts exporters and importers but theres lots of lots of opportunities in there but theres had to be short term and most people will probably be playing it out of hong kong going forward but there is a there is a divergence in investment attitude towards long duration investments into mainland china but how do you play that and again the european economy has been the link so far but people be taking profit from that trade in recent weeks no doubt and china is an economy where regional debt is really an issue right that youve been talking about in australia but its not just about china is it i mean once we get inflation under control how much distress could we see in these developing economies on the fiscal side of things yes spot on i think this time next year the language will be emerging market debt distress at record levels i think provincial so china will find its own methodology in its own way i mean theyve been cutting rates that have an inflation problem but they do they are getting over one of the biggest property bubbles weve ever seen and they need to work through the different i suppose in equivalence in mainland china and they have to resolve that its gonna be quite difficult but everyones going to have that same problem but next year the emerging economies southeast asia both protected from revenues but theres emerging economies of the big dispersion across the different continents but china has to resolve that as with everybody else but pressure on emerging government debt and the world bank imf will be stepping in for assistance but i would think that were coming out of this big spend that weve had over the past three years and inflation lowering at an increasing rate behind us and remember issuers of debt inflation helps you lower inflation and youve got high levels of debt its very difficult to operate going forward relative to a high inflation environment of the past two years