Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene. Along
Speaker 1: with Jonathan Farrell and Lisa Brownwitz Jay Leye. We bring
Speaker 1: you insight from the best and economics, finance, investment and
Speaker 1: international relations. Find Bloomberg Surveillance and Apple Podcast, Suncloud, Bloomberg
Speaker 1: dot Com and of course on the Bloomberg Termament. He
Speaker 1: is a former mayor of Boston. He is a Secretary
Speaker 1: of Labor of the United States of America. Marty Walsh
Speaker 1: here with our John Farrell after this interesting jobs report
Speaker 1: again the Dow up a hundred nineteen points, New York.
Speaker 1: I'm place to say, joining us now on TV and
Speaker 1: on Bloomberg Radio on the payrolls report. First reaction from
Speaker 1: the White House with US Labor Secretary Marty Wall. Secretary Walls,
Speaker 1: great to catch up with you, sir, as always, how
Speaker 1: me with this one, because we've all struggled with this
Speaker 1: labor market report this morning. How would you characterize the
Speaker 1: state of the labor market right now? Sexually? Welsh? In
Speaker 1: the United States, I would say, if you look at
Speaker 1: what's happened since President Biden's Tacond office, you dropped two
Speaker 1: points off the unemployment numbers, I'd say we have a strong, strong,
Speaker 1: strong market moving forward. Obviously, we have job openings that
Speaker 1: we have to work on, and we still have people
Speaker 1: out of work. And as you mentioned in in the
Speaker 1: in the words before I came on here, we're still
Speaker 1: dealing with the coronavirus. We're looking at the new variant
Speaker 1: now to see what the impacts that will have. But overall,
Speaker 1: we feel good. I feel good about where we're going
Speaker 1: as an economy here. Obviously you brought out inflation up
Speaker 1: as well. You know, the President made a moves this
Speaker 1: week with with the oil reserves and also you know,
Speaker 1: creating an economic plan. We're seeing people with with more
Speaker 1: opportunities and more more money in their bank accounts than
Speaker 1: this time last year or pre pandemic. I guess I
Speaker 1: should say. So, you know, we still have work to do,
Speaker 1: there's no question about it, but but I feel good
Speaker 1: where we're headed. Let's talk about that work and the
Speaker 1: work we still need to do. As you know, we
Speaker 1: talked a lot about where wages are close to five pc,
Speaker 1: the low ware inflation is currently and going into next
Speaker 1: week up leave a lot of people in this economy,
Speaker 1: in this market on wall straight. Secondly, walls looking for
Speaker 1: something closer to seven on c P I, do you
Speaker 1: still see the benefits of running this economy? Halts? Secondly, well,
Speaker 1: so the benefits to doing that as you see things well, well,
Speaker 1: you know one of the things that's want to talk
Speaker 1: this week, I went out to Los Angeles. I was
Speaker 1: out at the ports in Los Angeles and Long Beach,
Speaker 1: and when you think about the economy, you think about
Speaker 1: people coming back to work. One of the things when
Speaker 1: I was out there, you know we have the long show.
Speaker 1: I'm in working seven, not every day, but but the
Speaker 1: ability to work seven. We're seeing the ships come in
Speaker 1: with seeing the ships unloaded. And there's an issue with
Speaker 1: truck driving. And when you think about when you think
Speaker 1: about this economy and we think about all the different aspects,
Speaker 1: we really we have to be more intentional now and
Speaker 1: focus in certain areas and how do we create better opportunities.
Speaker 1: So truck driving is one of those areas that we
Speaker 1: have to create better pathways to bring more people back
Speaker 1: to work. When you look at this report, you see manufacturing, uh,
Speaker 1: the numbers are high. You look at transportation, the numbers high.
Speaker 1: You look at hospital care and healthcare, the numbers on
Speaker 1: as high. So we have to we have to start
Speaker 1: the focus now intentionally in different different actors of the
Speaker 1: economy to make sure we get we get people trained
Speaker 1: out and get people back to work. So this is
Speaker 1: not about a broad based effort to run an economy.
Speaker 1: Hall you think this is about specifically targeting certain sectors.
Speaker 1: Is that right? Right? Well, I think we have to
Speaker 1: target certain sectors now to bring those sectors back. I mean,
Speaker 1: we look at some of these numbers hospitality this month. Uh,
Speaker 1: the numbers are kind of when I don't want to
Speaker 1: say flat, but we didn't see growth on hospitality. We
Speaker 1: didn't see growth in construction. We saw growth in construction
Speaker 1: in the sector. We didn't see any growth actually job
Speaker 1: loss in the government sector. So we really have to
Speaker 1: start looking at these different sectors and see what the
Speaker 1: supports they need. And that's quite honestly why in the
Speaker 1: Build Back Better Reconciliation plan the President has put out there,
Speaker 1: there's twenty there's a couple of I think almost twenty
Speaker 1: billion dollars in job training, workforce development money that will
Speaker 1: allow us the opportunity here at the Department Labor to
Speaker 1: kind of focus on other sectors to help create and
Speaker 1: build them up. The reason I asked this question is
Speaker 1: because there was a big effort to get us back
Speaker 1: to where we were before the pandemic. And one measure
Speaker 1: of that one metric was the employment of population ratio,
Speaker 1: which is back to about fifty nine before the pandemic,
Speaker 1: make it was at about sixty one. And secondly, what
Speaker 1: was the federal reserve? The administration has talked about getting
Speaker 1: back to where we were. Do you think that's achievable?
Speaker 1: How dependent do you think this really is on just
Speaker 1: the virus? Is there's something else going on here in
Speaker 1: this labor market? Well? Yeah, I think we have to.
Speaker 1: I think we have to be realistic about the labor
Speaker 1: market and look at what is the future going to
Speaker 1: look like. I think that the pandemic has changed the way,
Speaker 1: or at least had conversations about the way the office
Speaker 1: looks people working, teller working. We've seen thirty percent I
Speaker 1: think last month if I get the number correctly, increase
Speaker 1: in entrepreneurship in this country. So you know there is
Speaker 1: an evolution and a change going on to some degree,
Speaker 1: I think that measuring measuring the way we do our
Speaker 1: economy back to February of I don't know what if
Speaker 1: they look like that when we get beyond the virus.
Speaker 1: But I definitely think that with the President and the
Speaker 1: administration staying focused on creating opportunities, five point almost six
Speaker 1: million jobs created since president by the Tacond Office. Four
Speaker 1: point two percent unemployment rate today, which is a good number.
Speaker 1: We obviously wanted to continue that number of going down.
Speaker 1: We've seen better participation in the black unemployment rate drop
Speaker 1: the whole percent women put unemployment rate four percent. We're
Speaker 1: starting to see some games here now, we do we
Speaker 1: still I think we have to continue to acknowledge his
Speaker 1: work to be done. Do you personally have more work
Speaker 1: to do in the seat you're in right now, Secretary Walsh,
Speaker 1: No question about it. I mean we have a lot
Speaker 1: of work to do. We have to work on making
Speaker 1: sure that we implement the unemployment insurance UM work that
Speaker 1: we're doing and kind of reorganizing unemployment insurance two million,
Speaker 1: two billion dollars. We have an office created job Force
Speaker 1: workforce development training money. I really want to look at
Speaker 1: changing the way we train workers. I think we want
Speaker 1: to make sure we're training workers not just for the
Speaker 1: jobs of today, but the jobs of the future, and
Speaker 1: thinking about more creating more pre apprentice programs. We have
Speaker 1: a lot of work to do here at the Department
Speaker 1: Labor the reason, so it's not a personal attack. There
Speaker 1: was just some news this week that maybe you might
Speaker 1: be interested in the seat that Charlie Baker might leave
Speaker 1: empty in the coming here. Do you want to respond?
Speaker 1: Do you want to sponsored? You'll put that right over
Speaker 1: right head. I wasn't even paying attention as I said,
Speaker 1: I have a lot of work to do here at
Speaker 1: the devironment of latter, Lady Kelly says, you're weighing the run.
Speaker 1: Is that true or false? Well, listen to the governor
Speaker 1: myself have a great relationship. You know, we were partners
Speaker 1: for seven years, six years in Boston. I was one
Speaker 1: year of Governor Patrick. We did a lot of work.
Speaker 1: We we what we started the pandemic together. We've got
Speaker 1: the city of Boston, the Carmalton, Massachusetts at least through
Speaker 1: the beginning days of the pandemic. And for the last
Speaker 1: week I've been I've been out in l a long beach,
Speaker 1: all over the country here in Washington today. So I'll
Speaker 1: leave it at that. Should I take a signal from
Speaker 1: your refusal to answer that direct question? There's no signal.
Speaker 1: I love my job here. Secondary Welsh will let you go, sir,
Speaker 1: I know you've got a busy morning. Thank you, thanks
Speaker 1: for being with us. The US Labor Market Secretary Marty
Speaker 1: Welsh that it's not much here to steer the feed
Speaker 1: away from what they've discussed all week. When they get
Speaker 1: together on December fifty and this real you have sizes
Speaker 1: of me, John, They're just gonna wait for more data.
Speaker 1: With two different reports there and a lot of people partists,
Speaker 1: including Jeffrey Rosenberg, portfolio manager of Systematic Multi Strategy Fund
Speaker 1: at black Rock. Jeffrey, when you get ambiguity like this,
Speaker 1: what do you do well, it's a really interesting report.
Speaker 1: I think you guys have broken it down well that
Speaker 1: it may not be so ambiguous when you when you
Speaker 1: look behind the headline. The headline is the disappointment on
Speaker 1: to ten. But as Mike McKee just went through, a
Speaker 1: lot of that looks like seasonality and the impact of
Speaker 1: seasonal flows coming in lower than what the seasonal factors
Speaker 1: would otherwise expect, and so you get some disappointment on
Speaker 1: the headline. As Jonathan just went through, the initial market
Speaker 1: reaction is all the machines looking at that headline number,
Speaker 1: give it a minute and you look at what Lisa
Speaker 1: talked about, which I think is the much stronger message here,
Speaker 1: that decline in these unemployment rates, the impact of labor
Speaker 1: force participation finally coming back. This is the strength of
Speaker 1: the underlying labor market that is speaking here. And I
Speaker 1: think when you look at the market reaction kind of fading,
Speaker 1: that initial disappointment is spot on, and that's really the
Speaker 1: bigger message. And Tom to your last point, I don't
Speaker 1: think this report really changes anything from the from the
Speaker 1: FED with regards to the labor market, but it is
Speaker 1: obviously the cross currents between the headline and the underlying components.
Speaker 1: I think the underlying components here are much stronger. Jeff,
Speaker 1: we got to talk about the FED when they get
Speaker 1: together on the fifth. It's not just about the type
Speaker 1: of conversation. Let's discuss their fullecast year and next year
Speaker 1: they've got unemployment at three point eight percent. Jeff, were
Speaker 1: almost there at full point to how much of an
Speaker 1: adjustment do we need to see in a couple of weeks. Yeah,
Speaker 1: we could certainly see the adjustments come down. Uh, you know,
Speaker 1: as they keep pace with how rapidly the labor market
Speaker 1: is is improving. I think they're closer on the on
Speaker 1: the jobs front than the other forecast, which is of
Speaker 1: course the big topic, which is their their inflation forecast,
Speaker 1: and I think that's going to be the driver into
Speaker 1: December fifte And of course, you know the other big story,
Speaker 1: the elephant in the room here is that this report,
Speaker 1: you know, doesn't have any of the COVID, any of
Speaker 1: the O Macron issues that we still have in front
Speaker 1: of us. So over the next ten days we're going
Speaker 1: to find out a lot more. That's going to drive
Speaker 1: that debate into the FED meeting on the fifteen. Jeff,
Speaker 1: I would agree with you that the underlying components are
Speaker 1: much more interesting and point to a very strong report.
Speaker 1: Aside from that headline, Miss I am though confused by
Speaker 1: average hourly earnings and how much we're seeing wages increase.
Speaker 1: That was a disappointment and to me it actually fell
Speaker 1: in terms of the pace of wage rises from month
Speaker 1: to month. What do you make of that? Yeah, it's
Speaker 1: hard exactly to to know what's going on there. A
Speaker 1: lot of the month to month variability, Lisa is confu
Speaker 1: using based on the shift in the underlying mix of
Speaker 1: who's coming in, who's coming out. So when you look
Speaker 1: at average hourly earnings as opposed to other measures like
Speaker 1: employment cost index UH, what you end up seeing is,
Speaker 1: you know, a measurement of two things, what's the change
Speaker 1: in who's coming in and out and what's the change
Speaker 1: and what they're getting paid. And so when you have
Speaker 1: more lower wage workers entering the pool relative to higher
Speaker 1: wage workers, it can push down what you see in
Speaker 1: average hourly earnings. Even if what we think of is
Speaker 1: kind of a fixed pool of workers, wages are going up.
Speaker 1: The message on those fixed pool UH metrics have been
Speaker 1: for a while now clear that we're seeing pricing power
Speaker 1: come back to wages. And I don't think this disappointment
Speaker 1: on average hourly earning should be overly interpreted as as
Speaker 1: kind of challenging that story. I think it's still a
Speaker 1: strong labor market, with strong labor market racing and wage inflation.
Speaker 1: Fifty minutes away from the up and in Bow States
Speaker 1: side features up eighteen up four tents of one percent
Speaker 1: on the NaSTA and NaSTA one hundred features of six
Speaker 1: tenths of one percent. Counting down to the up and
Speaker 1: in Bow will be catching up with Muhammad al Arian
Speaker 1: of Rick Reida, Mike Collins, and Anastasia Amarosso Tom to
Speaker 1: really break down this job to report and get first
Speaker 1: reaction as well from the White House in about fifty
Speaker 1: minutes time. The reaction as well of a market lifting up.
Speaker 1: I note the nas deck one after all this up
Speaker 1: six tenths of a percent, and the VIX is a
Speaker 1: key statistic for me really escaping the thirty and twenty
Speaker 1: eight level in the twenty six point one eight Again,
Speaker 1: Jeffrey Rosenberg with us with black Rock, Jeff, I I
Speaker 1: want to talk about systematic and your responsibilities of black Rock,
Speaker 1: and I don't want to care about I don't care
Speaker 1: about systematic the twelve thirty one or even out in
Speaker 1: the January. How are you managing an allocating capital outter
Speaker 1: the middle of next years, say the July FED meeting. Yeah,
Speaker 1: this is a really good question, Tom, because what we're
Speaker 1: really debating is, you know, the bigger picture away from
Speaker 1: today's report is the FED is talking about accelerating the
Speaker 1: pace of tapering, which is so that they can accelerate
Speaker 1: the pace of tightening. Uh. And you know markets have
Speaker 1: priced that in so so a lot of that changes
Speaker 1: with us. The bigger change that we all have to
Speaker 1: contemplate is the impact on real interest rates. You've had
Speaker 1: a spectacular level of support for acid inflation across all markets,
Speaker 1: whether they be financial markets or otherwise, from exceptionally low
Speaker 1: levels of real interest rates, and the FED is basically
Speaker 1: saying it's time to change that outlook. So we should
Speaker 1: expect a very different financial market outlook in an environment
Speaker 1: where FED policy is reacting to the exceptionally accommodative UH
Speaker 1: settings of negative real interest rates. And so that challenges
Speaker 1: a lot of investment returns that you've seen investment portfolio
Speaker 1: UH strategies, and so we're looking at, you know, where
Speaker 1: are their vulnerabilities and where are their opportunities in a
Speaker 1: rising real rate environment. I just want to point out
Speaker 1: that as we speak and as traders passed through this report,
Speaker 1: two of your treasure yields have turned positive or turned
Speaker 1: positive on the day. I should say, uh, once again,
Speaker 1: zero point six people assessing the underlying components here and
Speaker 1: seeing a very strong report. Jeff, with respect to FED hiking,
Speaker 1: how many rate hikes can this market withstand and not
Speaker 1: be disrupted from a risk asset performance perspective? Really great question,
Speaker 1: because look at what the bond market is telling you
Speaker 1: with this massive curve flattening, right, So it's a very
Speaker 1: clear message from the bond market that it can't withstand
Speaker 1: that much increases. So what you see priced into bond
Speaker 1: markets is an expectation that the Fed is going to
Speaker 1: do what they're telling you increase the pace of of
Speaker 1: rate increases. We've priced in from one hike in two
Speaker 1: thousand twenty two to two hikes, so it's not a
Speaker 1: super aggressive increase. And when you look further out, you
Speaker 1: see that that pace of pricing in of interest rates
Speaker 1: by the Fed starts to fade relative to the feds
Speaker 1: dot plots, and that is reflective of the expectations that
Speaker 1: the market, financial market conditions tightening, the impact of rising
Speaker 1: real interest rates just can't handle as much of a
Speaker 1: normalization of interest rates as the kind of full trajectory
Speaker 1: of Fed normalization and the dot plots otherwise would say.
Speaker 1: And that flattening of the yield curve, you know, is
Speaker 1: a message that we should pay attention to. It's basically
Speaker 1: saying as you move into an aggressive FED tightening policy,
Speaker 1: that the impact is going to slow the economy, tighten
Speaker 1: financial conditions, and is A is A is a warning
Speaker 1: of a recessionary indicator. Whether the FED goes there will see.
Speaker 1: But that's what the bond market is saying. Okay, I
Speaker 1: agree the bond market is saying that very quickly. Or
Speaker 1: Jeff Rosenberger, as we move on to the equity markets,
Speaker 1: the ambiguity of today's report. Does it change the path
Speaker 1: or the belief the cadence of taper to titan. I
Speaker 1: don't think it. I don't think it does. I think
Speaker 1: that and as Lesa just highlighting, you know, the turnaround
Speaker 1: in the two years. I think the market figuring out
Speaker 1: that this isn't gonna this is not a disappointing a
Speaker 1: playrole report that takes the FED out. So I think
Speaker 1: the pace is as the market the narrative is is
Speaker 1: still the same pricing in the acceleration. Now how far
Speaker 1: the market gets ahead of the Fed, or whether the
Speaker 1: market can push the FED to go even further than that.
Speaker 1: It's kind of the next phase. You know, we've priced
Speaker 1: in basically, you know, two hikes in two accelerating that
Speaker 1: first tike to June or July of next year. You know,
Speaker 1: will will we get more? I think we're gonna have
Speaker 1: to see more data, more worries from the Fed on inflation,
Speaker 1: and a willing this to be more aggressive before we
Speaker 1: get there. Jeff Rozenberg, thank you so much for the
Speaker 1: treatment this morning, on this job's report, right now, on
Speaker 1: this economy digestingness of employment report, and of course markets,
Speaker 1: A Dow up eighty three points, a lift not like
Speaker 1: the futures lift we saw off of a thirty, but
Speaker 1: nevertheless up here the VIX point five five a state
Speaker 1: of the American economy. Tiffany Wilding joins us with Pimco,
Speaker 1: their chief US economist. Tiffany, your excel spreadsheet into twenty two.
Speaker 1: What's the biggest economic plug in on your spreadsheet? What's
Speaker 1: the biggest mystery? Um? Well, with the labor market report today,
Speaker 1: I mean I think I would I would just point
Speaker 1: out the participation rate UM is going to be I think,
Speaker 1: really key UM, and how much labor supply you know,
Speaker 1: we do get back because you know, I think that,
Speaker 1: as Marty Wall sort of hinted at when he was speaking,
Speaker 1: I think the labor market post pandemic, you know, could
Speaker 1: look different in many aspects than it is pre pandemic. UM.
Speaker 1: You know, it's it's obviously been talked about that we
Speaker 1: we've had a lot of retirements as a result of
Speaker 1: this pandemic, and I think those people probably won't be
Speaker 1: as quick to come back to the labor market. But
Speaker 1: in addition to that, I think that there there's more frictions,
Speaker 1: um in this labor market now and and those have
Speaker 1: to do with, um, you know, the types of jobs
Speaker 1: that people prefer are changing and where jobs are are located,
Speaker 1: where they're demanded versus where the labor is supplied. That's
Speaker 1: also changed as a result of telework and people moving
Speaker 1: out of large cities. UM. So it's I think the
Speaker 1: question is how long do these things kind of take
Speaker 1: to resolve themselves. Um. And of course that's gonna that's
Speaker 1: gonna matter for the participation right next year. Yesterday Mark
Speaker 1: Kisel joined alber Intelligence Credit Panel and talked about how
Speaker 1: he was glad to see the FED changing its rhetoric
Speaker 1: and that the Federal Reserve is way behind the curve. Uh.
Speaker 1: Does that represent your view as well, and does this
Speaker 1: labor market really feed into that? Well? I mean, I
Speaker 1: think that are certainly a risk. Uh. You know that
Speaker 1: we have higher and more persistent inflation that than the Fed. Uh.
Speaker 1: You know or or other forecasters are projecting um. But
Speaker 1: but ultimately, though, I do think that the FED is
Speaker 1: managing the risk of of higher inflation by you know,
Speaker 1: by talking about the fact that they're probably you know,
Speaker 1: that they're going to increase the pace of tapering. We
Speaker 1: think they're now going to get the asset purchase programs
Speaker 1: done by March. That gives them more room this year
Speaker 1: to hike rates earlier, um than than we're previously thinking.
Speaker 1: We you know, we now think they probably hike in June.
Speaker 1: So I think the FED is is moving towards met
Speaker 1: or has moved towards managing these upside inflation risks, you know.
Speaker 1: And and ultimately, although inflation has proven to be more persistent, um,
Speaker 1: you know, we have to remember that we had the
Speaker 1: delta variant and the the COVID cases that have been
Speaker 1: more elevated, I think for longer than many expected as well,
Speaker 1: and that had you know, implications for not only US
Speaker 1: inflation but also global inflation. So our you know, our
Speaker 1: own view is still that inflation does moderate next year,
Speaker 1: you know, And that and that the FED really isn't
Speaker 1: behind the curve. But I think there's certainly a growing
Speaker 1: risk of that and a risk that the FED has
Speaker 1: to manage. There's also a growing risk that the FED
Speaker 1: is going to have to tighten conditions to deal with
Speaker 1: inflationary impulses that do not relate to monetary policy. The
Speaker 1: idea that Ellen Zentner raised of Morgan Stanley this morning
Speaker 1: that perhaps the Fed's response to omicron is to actually
Speaker 1: tighten sooner rather than later, simply because you see some
Speaker 1: of the supply chain disruptions persist. What's your view on that, well,
Speaker 1: I think one of the reasons, one of the things
Speaker 1: that have contributed to the elevated inflationary princes is the
Speaker 1: fact that we've have seen people substitute away from services
Speaker 1: towards goods um and that overall, you know, obviously the
Speaker 1: um you know, the post pandemic stimulus that we've gotten,
Speaker 1: you know, has boosted consumption of goods and in the capacity,
Speaker 1: and that's run up against a clear capacity constraints. So
Speaker 1: if you know, if if if a macron, uh, you know,
Speaker 1: you know, basically prolongs this very high, high high pace
Speaker 1: of of goods demand that we've seen over the last year,
Speaker 1: We're still going to have these sorts of capacity constraints.
Speaker 1: That we're running up against because it does seem like
Speaker 1: on the supply side, it's much less inelastic. In other words,
Speaker 1: it expands much less than we had fought, you know.
Speaker 1: So I think I think that there is room for
Speaker 1: the Fed to try to alleviate some of that demand
Speaker 1: a little bit until the supply can catch up. Um.
Speaker 1: But but you also have to remember here that it's
Speaker 1: tricky because monetary policy works through long and variable legs,
Speaker 1: and so the tightening that the Fed does today, you know,
Speaker 1: that really starts to uh, you know, filter through the
Speaker 1: economy in a more meaningful way, you know, a year
Speaker 1: to maybe even two years out. So um, you know,
Speaker 1: they have to be a little bit careful here. Is
Speaker 1: inflation going to come down by itself without the moving um,
Speaker 1: you know, or or is it going to be more persistent?
Speaker 1: I think that's really the key question. Let me circle
Speaker 1: back the one final question, which I guess takes us
Speaker 1: back six months. Is tapering tightening? Well, I mean I
Speaker 1: think it depends on what the market had priced in previously, right,
Speaker 1: because I mean it's about market expectations. So if the Fed,
Speaker 1: you know, is announcing a faster you know that they're
Speaker 1: going to uh, you know, likely announce a faster pace
Speaker 1: of the per or tapering. Excuse me, you know then
Speaker 1: then I think that that's a you know, it could
Speaker 1: be a surprise to the markets. Markets have to price
Speaker 1: that in and that implies, you know, some of financial
Speaker 1: conditions tightening. The other thing that's important here is the link,
Speaker 1: even though the Fed has tried to delink it, the
Speaker 1: link between tapering and rate expectations. You know it definitely
Speaker 1: if they get that purchase programs done sooner, it allows them, um,
Speaker 1: you know, the opportunity or or the option to to
Speaker 1: hike sooner as well. You know, so certainly that's tightening. Tiffany,
Speaker 1: thank you. Someone a Tiffany Welding a brief here from
Speaker 1: PIMCO right now on a Friday, as we plan for
Speaker 1: the weekend, as we try to stagger through this holiday season.
Speaker 1: With delta, amicron and the other Greek letters, I can pronounce,
Speaker 1: we gain perspective for Andrew PEKOFS. He's professor virologists JOHNS.
Speaker 1: Hopkins Bloomberg School of Public healthon of Chrise. Mr Bloomberg
Speaker 1: has a modest interest in this TV and radio platform
Speaker 1: as well. Dr PEKOFS, I want to talk about the
Speaker 1: reality of Johannesburg, pretoria and the rest. And I want
Speaker 1: to look at Adrian Puran, who's an internationally acclaimed virologist
Speaker 1: in South Africa. Tell us the back and forth this
Speaker 1: weekend in South Africa as they inform pros like you
Speaker 1: about amicron. Well, it actually starts before Thanksgiving. UH. Sequences
Speaker 1: were being distributed through the research networks that are focused
Speaker 1: on COVID nineteen before Thanksgiving, So we saw these sequences
Speaker 1: and of course they registered to US as being on
Speaker 1: of significant concern on paper. But then the Thanksgiving Day
Speaker 1: announcements of the spread of this virus through South Africa
Speaker 1: really gave the entire world a headstart. I mean, my
Speaker 1: lab is ready this week to do omicron specific experiments
Speaker 1: and it's only because the South African public health, US
Speaker 1: and scientific community shared all of their information about sequences
Speaker 1: as well as case numbers UM. So early the world
Speaker 1: got a head start and we are better prepared now
Speaker 1: to handle this because of their efforts. When will we
Speaker 1: see results from labs such as yours. Two things that
Speaker 1: I'm really looking for now right now Next week will
Speaker 1: be important to follow surges and hospitalizations in South Africa,
Speaker 1: because that's about that two week window post the emergence
Speaker 1: of this virus where we expect to see the hospitalization
Speaker 1: rates move. Remember, hospitalization rates lag behind case rates. And
Speaker 1: then as soon as we get icelets and we have
Speaker 1: islets in the US right now, UM laboratories will be
Speaker 1: telling us how well the antibodies from vaccine and infection
Speaker 1: UH CROSS react to all macron and that will be
Speaker 1: that first hint about how widely we expect this virus
Speaker 1: to be able to transmit dr Packosh. Until we find
Speaker 1: out that information, it's hard to know whether we're underplaying
Speaker 1: or overplaying this whole new variant. What would your recommendation
Speaker 1: be As people head to Christmas parties, as people go
Speaker 1: into the office, they want to engage with other people.
Speaker 1: Do you think that it is time to actually restrict
Speaker 1: activity a little bit more or do you think that
Speaker 1: people need to go about their lives and act as
Speaker 1: though this is just another kink on the way to recovery.
Speaker 1: Right now, I would suggest two ways to be proactive
Speaker 1: in a in a positive way. Number one, vaccines, Go
Speaker 1: out and get your booster. Go out and get your
Speaker 1: vaccination if you haven't gotten it, If you've been infected,
Speaker 1: go out and get your vaccine, because we know that
Speaker 1: that increases your immunity. Right now, we've got a window
Speaker 1: of time where we as a population here in the
Speaker 1: US can increase our immunity. And even if some of
Speaker 1: that doesn't cross react to all macron, the more immunity
Speaker 1: the better, and it will it will protect us against
Speaker 1: severe disease uh if omicron doesn't been to spread. And
Speaker 1: then the second thing is to think about testing protocols.
Speaker 1: One of the critical things in the Biden plan that
Speaker 1: may go under people's radar screens is the use of
Speaker 1: at home tests. That is an incredibly powerful tool for
Speaker 1: us to really intervene and stop people who are potentially
Speaker 1: trans going to transmit the virus. And utilizing those at
Speaker 1: home tests is going to be very, very critical to
Speaker 1: really controlling this omicron surge. And let's not forget the
Speaker 1: delta surge that we're still in the middle of Andy.
Speaker 1: Because your laboratory is working specifically on O macron, what
Speaker 1: is your sense of its VIRU lens. I know that
Speaker 1: we're going to get the actual data next week, but
Speaker 1: on a preliminary basis, a lot of people have found
Speaker 1: that yes, vaccines do prevent a severe illness, and it
Speaker 1: does seem like perhaps you're not seeing as much of
Speaker 1: a surge in hospitalizations yet as you would might expect.
Speaker 1: What's your sense of what the reality is? Yeah, I
Speaker 1: think we really need to wait one more week. You know,
Speaker 1: the vaccination yet, you know travel US are the primary
Speaker 1: people that have been picked up now with UM with
Speaker 1: with a macron, they have a tendency to be of
Speaker 1: more highly vaccinated population. So some of the data we're
Speaker 1: seeing now from the US and from Europe is really
Speaker 1: skewed to vaccinated populations. In the next week, UM in
Speaker 1: South Africa will be the lead on this. We'll be
Speaker 1: starting to hear how the various populations are doing with
Speaker 1: respect to infection and disease of varry. So that's really
Speaker 1: going to be the critical thing, and they always great
Speaker 1: to catch up with. He said, let's get to hear
Speaker 1: from you, Andrew Pekosta of John's Health Kids. This is
Speaker 1: the Bloomberg Surveillance Podcast. Thanks for listening. Join us live
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Speaker 1: the terminal. I'm Tom keene In. This is Bloomer