Speaker 1: Welcome to the Bloomberg Penl podcast. I'm Paul swing you.
Speaker 1: Along with my co host Lisa Brahma Waits. Each day
Speaker 1: we bring you the most noteworthy and useful interviews for
Speaker 1: you and your money, whether at the grocery store or
Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple
Speaker 1: podcast or wherever you listen to podcasts, as well as
Speaker 1: that Bloomberg dot com. There's a huge focus right now
Speaker 1: on the fate of small businesses. Is their hard hit
Speaker 1: by the shutdowns from the coronavirus pandemic. Someone who's very
Speaker 1: clean clued in to exactly how these businesses operate and
Speaker 1: how they can survive and thrive going forward. As Jim mccalvey,
Speaker 1: co founder of Square, that incredibly popular payment system electronic
Speaker 1: payment system used by many small businesses, also the author
Speaker 1: of a new book, The Innovation Stack, Building an unbeatable business,
Speaker 1: one crazy idea at a time. He has a former
Speaker 1: glass blower who ended up founding one of the pre
Speaker 1: eminent mobile online payment systems. Jim, thank you so much
Speaker 1: for being with us today. I wanted to start with
Speaker 1: just anecdotally, given your conversations with small businesses, how hard
Speaker 1: hit have they been from this whole episode? Oh my god, Lisa,
Speaker 1: They've been tremendously hard hit. UM, and everybody knows it
Speaker 1: it's uh, but nobody knows the extent of it. We
Speaker 1: are watching, uh, some businesses closed, We're watching employees and panics. UM,
Speaker 1: It's it's bad. And I'm actually still in the art
Speaker 1: world and I still run a small studio and my
Speaker 1: staff was terrified, UM, because we had to shut down.
Speaker 1: So why is this time different than other times when
Speaker 1: you talk about financial downturns? So this is the first
Speaker 1: time there's been a voluntary shutdown of a healthy economy.
Speaker 1: So I'm also a director of the St. Louis Federal Reserve,
Speaker 1: and so I get to see the economic data almost
Speaker 1: in real time. And we had a very healthy economy
Speaker 1: going in UM, and we elected to voluntarily closed down, uh,
Speaker 1: the economy to solve a medical problem. Uh. This is
Speaker 1: different than most recessions. Most recessions just happened because there's
Speaker 1: some structural problem in the economy. There was none in
Speaker 1: this case. What happened was we had this medical emergency
Speaker 1: and to fight the disease, we had to close the economy.
Speaker 1: But it's different. So yes, you you do run an
Speaker 1: art studio and you are a glassblower, I believe based
Speaker 1: on your bio. Yet you did also found co found Square,
Speaker 1: which is one of the key technological advances for a
Speaker 1: lot of small businesses. And I'm just wondering the role
Speaker 1: of tech at this moment when so much business is
Speaker 1: going online. How are you seeing this sort of transformative
Speaker 1: moment for small businesses in the relationship with their tech infrastructure. Well,
Speaker 1: they're super defended on the tech infrastructure. As a matter
Speaker 1: of fact. Square has been rolling out new products almost
Speaker 1: every day to help small businesses adapt, and we're putting
Speaker 1: new products in their hands. Uh, you know, probably one
Speaker 1: a week now, allowing restaurants to turn to a delivery
Speaker 1: and pick up, uh, making our software free for companies
Speaker 1: that need it, and basically look um, this in some
Speaker 1: ways helps companies that have modernized their processes to use
Speaker 1: electronic payments, to use electronic record keeping, to use electronic meetings,
Speaker 1: to use distributed workforces, and it's forcing a lot of
Speaker 1: other companies to get with the program going forward. I'm
Speaker 1: just wondering, do you expect a lot of these smaller
Speaker 1: businesses to go out of business completely or do you
Speaker 1: think that they'll just be a sort of transformation as
Speaker 1: far as weeding out the most successful successful ones. Well,
Speaker 1: I mean, there's certainly going to be a winnowing down
Speaker 1: of companies that were not well prepared for this, But
Speaker 1: the real tragedy is that there were a lot of
Speaker 1: healthy businesses that are getting caught in it. The government's
Speaker 1: trying to step in. One of my great concerns is
Speaker 1: that the government is doing a lot of their aid
Speaker 1: through uh sort of antiquated paper based systems, and it's
Speaker 1: not going to get the money to the people that
Speaker 1: need it and the businesses need it fast enough. So
Speaker 1: at Square we're working diligently to try to give them
Speaker 1: the tools for instantaneous or near real time um action
Speaker 1: if the government chooses to do that. Wait. So, in
Speaker 1: other words, you're working with the government right now to
Speaker 1: try to make these payments electronic. Yes, so, I'm Jack
Speaker 1: said a tweet about this a couple of weeks ago.
Speaker 1: But basically, our whole company stands ready to give whatever
Speaker 1: aid we can because we've had the electronic rails working
Speaker 1: for several years, and they work with millions of businesses
Speaker 1: and scaling for millions to tens of millions or hundreds
Speaker 1: of millions is not as difficult as scaling from nothing
Speaker 1: to you know, project number one. Jim McKelvey, thank you
Speaker 1: so much for being with us and for sharing your insights.
Speaker 1: Jim McKelvey as co founder of Square based in St.
Speaker 1: Louis author of The Innovation Stack, Building an Unbeatable Business,
Speaker 1: One Crazy Idea at a Time, a new book that's out.
Speaker 1: He also is a glassblower, which I really love as
Speaker 1: somebody who used to do sculpture a long time ago.
Speaker 1: One of the key questions for markets going forward is
Speaker 1: whether inflation will actually start to pick up this time. Typically,
Speaker 1: in the past, the idea has been theoretically, when governments
Speaker 1: print money that leads to inflation. It didn't happen in
Speaker 1: two thousand nine. People are expecting it not to happen again.
Speaker 1: But are they wrong. Maria Murphy joining us now vice
Speaker 1: president and portfolio manager at Lomas Sales, which oversees nearly
Speaker 1: three hundred billion dollars and is based in Boston. Mara
Speaker 1: Maura there This to me is one of the most
Speaker 1: important debates at a time when people are basically shrugging
Speaker 1: off the concept of inflation. Going forward, even as governments
Speaker 1: and central banks unleash some of the biggest financial packages
Speaker 1: ever to hit markets. Do you think this time is
Speaker 1: different the two nine financial crisis and that this actually
Speaker 1: will spurf inflation? Hi, Lisa, thanks for having me. Um.
Speaker 1: You know, it's certainly different this time, and that the
Speaker 1: pace and the size that the FED is is going
Speaker 1: and buying right now is drastically different than any of
Speaker 1: the other quei's we've ever seen. They're really doing this
Speaker 1: at what I'd call a sprint pace, and we need
Speaker 1: to get ourselves into this marathon mindset rather than the
Speaker 1: frint we've been in, because they need As you see
Speaker 1: this week, they're already starting to taper the pace of
Speaker 1: their purchases and we'll see how the market responds to that.
Speaker 1: So far, as you mentioned that break evens are off
Speaker 1: their lows um which suggests that the market is no
Speaker 1: longer pricing that real fear of deflation or disinflationary risk,
Speaker 1: but we're still well off the levels of being afraid
Speaker 1: of inflation to come. I think the thing to watch
Speaker 1: that will be key to see if we do good
Speaker 1: inflation this time with all the easing, is what happens
Speaker 1: with the dollar. We need to watch for that excess
Speaker 1: dollar liquidity in the market, and given the amount that
Speaker 1: we've seen with increased swap lines from the FED, a
Speaker 1: weaker dollar would finally perhaps give us that impotence for
Speaker 1: inflation pressure. But I think that's a lot further down
Speaker 1: the line, and right now we need to be focused
Speaker 1: on the pace of the seed byon Alright. So, I
Speaker 1: guess inflation is sort of a hard concept to to
Speaker 1: get your mind around because there are a lot of
Speaker 1: different components to it, and there are a lot of
Speaker 1: potential scenarios in terms of whether the financial package from
Speaker 1: the FED continues to accelerate or if it does slow down.
Speaker 1: As you talked about, there is a much more concrete
Speaker 1: issue of bond yields, and we're looking right now at
Speaker 1: tenure yields at at three quarters of a percent, and
Speaker 1: you're seeing people expect that rate to actually go down
Speaker 1: over time, even as the US prints unprecedented amount amounts
Speaker 1: of these securities. At what point will that increase in
Speaker 1: supply lead to higher yields. That's the ultimate question here,
Speaker 1: right is timing on all of this, And I think
Speaker 1: unfortunately we still have too many unknown to really have
Speaker 1: a good sense of when that actually might occur. The
Speaker 1: Fed is talking about issuing T bills right now for
Speaker 1: um supply to pay for this stimulus, but eventually they
Speaker 1: may need to issue on the back end of the curve,
Speaker 1: which I don't think we have a lot of natural
Speaker 1: demand there right now with levels as low as you mentioned,
Speaker 1: because people are starting to step into some of the
Speaker 1: new I G issuants rather than to day in the
Speaker 1: safe case incursory assets, but volatility remains really high in
Speaker 1: this asset class. The set has improved liquidity, but ball
Speaker 1: is still there. And so I think, you know, given
Speaker 1: that we're likely to see bigger move in per day,
Speaker 1: and the range of yields that we're going to be
Speaker 1: in will likely be wider than we've been used to.
Speaker 1: So when we used to trade in a range of
Speaker 1: twenty to thirty basis points on ten or thirty year yields,
Speaker 1: now I think that range could be a lot wider
Speaker 1: while we try to figure out where the right level
Speaker 1: is based on the supply that's coming and based on
Speaker 1: the buying that's happening. The volatility has pretty significant consequences,
Speaker 1: not only for the Treasury, market, but also for credit.
Speaker 1: And I'm wondering what this does for investment grade bonds
Speaker 1: even as they're back stopped by the Federal Reserve, given
Speaker 1: the fact that they're more sensitive than ever to the
Speaker 1: fluctuations in the volatility and treasury yields. Yeah, one of
Speaker 1: the patterns we've seen over the last week is that
Speaker 1: all of this new ig issuance that's come to market, Um,
Speaker 1: you have deals that are highly oversubscribed. Um. I'd liken
Speaker 1: it to all of us right now, rushing to get
Speaker 1: that online order. We all wake up early and we're
Speaker 1: trying to, you know, secture that online delivery for our
Speaker 1: groceries every day. And are you are you actually succeeding,
Speaker 1: by the way, are you? Are you? It's so hard,
Speaker 1: isn't this? I have I've failed every single day. I
Speaker 1: actually have to go out, get get geared up in
Speaker 1: my hasmat suit and go to the grocery store. But
Speaker 1: carry out please. So you know, if we think of
Speaker 1: it like that, we have this rush for everyone going
Speaker 1: to the same space right now because that's where the
Speaker 1: FED is supporting. So you know that old adage of
Speaker 1: don't fight the bed persist here. So you want to
Speaker 1: be in i G and that UM demand for these
Speaker 1: high quality, large deals is really persisting and I think
Speaker 1: that will continue UM and we've only probably just seen
Speaker 1: the start of that, and I think to strengthen the
Speaker 1: secondary will be the next order of operations after all
Speaker 1: of this new issue. So it sounds like you're overweight
Speaker 1: investment grade? Is that right? Yeah, We're We're constructive on
Speaker 1: the new issuants here, and we like the level of
Speaker 1: yields after the backup, and I think given the natural
Speaker 1: buyer and the stead it's a place we definitely like
Speaker 1: and we'll be adding to What about high yield UM,
Speaker 1: it's a little bit harder to source high heeled paper
Speaker 1: right now. Uh, We're we're having we're seeing that UM
Speaker 1: i G with that excess supply is a little bit
Speaker 1: easier for us to be buying right now UM in
Speaker 1: a high yield. I'm just not sure we have a
Speaker 1: good sense yet, UM. Given the unknowns with the recovery
Speaker 1: of you know, how how long will this last? We
Speaker 1: how fast can company is really resume normal operations and
Speaker 1: how big and how you know, what's the magnitude of
Speaker 1: this recession and not knowing those unknowns, it's hard to
Speaker 1: really assess recovery values and highlo companies, and so I
Speaker 1: guess we're just not ready to say that the uh,
Speaker 1: the bounce is real here yet, so we're not adding
Speaker 1: to their respectors at the mall. That's really compelling to me.
Speaker 1: You said it's difficult to source paper. In other words,
Speaker 1: has a dramatic move that we've seen been largely on paper,
Speaker 1: and nobody really wants to solidify their losses by actually
Speaker 1: selling the underlying bonds. Is that is that what you're saying.
Speaker 1: Liquidity is definitely improving across the board across most markets,
Speaker 1: but I think it's it's perhaps not necessarily people stepping
Speaker 1: in to buy yet in large size. UM, this this
Speaker 1: sell off has happened very quickly. I think, you know,
Speaker 1: less than a month, or just about a month is
Speaker 1: how long it took for us to hit the bottom
Speaker 1: here if we did hit the ball them, And that's,
Speaker 1: you know, the fastest pace we've seen in a long time. UM.
Speaker 1: Back in eight seven, it took about seventy five days
Speaker 1: for the peak to trough to occur, and this time
Speaker 1: it took less than thirty. So given that it just
Speaker 1: happened so quickly, I'd be shocked if there isn't more
Speaker 1: downside to come, and I think in light of that,
Speaker 1: it's it's unwise to be stepping into risk here. Maura Murphy,
Speaker 1: thank you so much for being with us. Mor Murphy,
Speaker 1: vice president and portfolio manager at Loomis Sales with almost
Speaker 1: three billion dollars under management, based in Boston. I'm Lisa Abramoy.
Speaker 1: It's by co host and colleague Paul Sweeney Off today
Speaker 1: from New York. This is Bloomberg Markets. There's a keig
Speaker 1: question in the transformation of the US economy right now
Speaker 1: that's going on in the heels of the coronavirus, and
Speaker 1: that is what is the state of the consumer? Will
Speaker 1: they be able to maintain the recovery that we saw
Speaker 1: that will have to happen yet again and may not
Speaker 1: happen yet again for another couple of years. Joining us
Speaker 1: now is David Coudla, chief executive officer and chief investment
Speaker 1: strategist at Mainstay Capital Management. David, this has been a
Speaker 1: sort of key talking point for years that the American
Speaker 1: consumer is very strong. Right now we are seeing an
Speaker 1: absolute demolition in confidence among American consumers. How pivotal are
Speaker 1: they in the recovery from this period of time that
Speaker 1: we're looking at, it will be very pivotal highly. So
Speaker 1: the you know, the consumer is two thirds of the
Speaker 1: U S economy. And how the consumer uh comes out
Speaker 1: of this in terms of their UH, purchasing habits, the
Speaker 1: consumer sediment, consumer confidence, how soon consumers are willing to
Speaker 1: re engage the economy, how unemployment affects their behavior coming
Speaker 1: out of this, how pay cuts because some of the
Speaker 1: you know, there are different impacts on different parts of
Speaker 1: different demographics across the US. We have some that are
Speaker 1: going to be unemployed for a certain period of time,
Speaker 1: and the fiscal stimulus packages addressing some of that, uh
Speaker 1: in a meaningful way. UH. There are others that are
Speaker 1: going to just have haircuts in their pay A lot
Speaker 1: of the automotive industry here in Michigan have pay deferrals
Speaker 1: um that or pay cuts just straight pay cuts that
Speaker 1: will go on for months, and so that's going to
Speaker 1: be affecting, you know, consumer discretionary activity. So UH, it's
Speaker 1: yet to be seen, you know, so much of this
Speaker 1: is unknown, but it will be key and how the
Speaker 1: consumer behaves coming out of or on the other side
Speaker 1: of the coronavirus restarted the economy. Yeah, I was looking
Speaker 1: at a story out of the Financial Times, the survey
Speaker 1: that they conducted this. It came out today that nearly
Speaker 1: three quarters of Americans say that coronavirus pandemic has reduced
Speaker 1: the family's income nearly a quarter. So their household income
Speaker 1: had been cut very significantly, according to this poll. And
Speaker 1: you're very much at the epicenter of that when you
Speaker 1: look at the auto industry in Detroit and how much
Speaker 1: has just come to a complete halt. How much long
Speaker 1: term damage will that do? I mean, that's sort of
Speaker 1: a key question. I'm wondering how quickly can people revive,
Speaker 1: not just from a balancee perspective, but from a confidence perspective.
Speaker 1: Is there any kind of historical precedent. I don't know
Speaker 1: that there is. You know, this is the first recession
Speaker 1: that's been brought on by um, a pandemic that's been
Speaker 1: brought on by any kind of disease or virus. So
Speaker 1: it's unknown in that regard um. You know, we have
Speaker 1: some predictability and that you know, we came into this
Speaker 1: with a really an economy on pretty good footing in
Speaker 1: terms of being at fifty year unemployment, we had rising wages,
Speaker 1: we had a strong relatively strong consumer coming into this,
Speaker 1: and then the economy didn't shut down or slow down
Speaker 1: under normal business conditions are a normal business cycle. It
Speaker 1: was an artificial restraint. We the government actually shut down
Speaker 1: the economy and we're then we're going to fire back up.
Speaker 1: But there's some natural things or natural or human factors
Speaker 1: that have to happen for that to reoccur. So there
Speaker 1: are a lot of unknowns in that. As an investor,
Speaker 1: how do you trade around this? Well? I think for now,
Speaker 1: I think that you know, these last two days, there
Speaker 1: is a lot of optimism about you know, what we
Speaker 1: saw over the weekend in New York City, the improvement
Speaker 1: of the last several days in Europe, specifically in in
Speaker 1: France and Spain, in Italy, um, and so there's confidence
Speaker 1: about the number of new cases slowing. But uh, you know,
Speaker 1: we know that there we have a long way to
Speaker 1: go here and the economic impacts are still to be realized.
Speaker 1: So I think that investors need to be careful about
Speaker 1: thinking that this is this is behind us, and we
Speaker 1: think that it's still important to have, you know, some
Speaker 1: defensive posturing in play, some hedges, in place in your portfolio,
Speaker 1: because there's there's still volatility ahead. We still got some
Speaker 1: some pretty bad ecademic numbers to come out, and uh
Speaker 1: first quarter earnings and even second quarter earnings that are
Speaker 1: gonna be pretty abysmal. So do you think that you'd
Speaker 1: be uh selling this rally and that you expect the
Speaker 1: US equity markets to test new lows. I don't know
Speaker 1: I full test new lows, but I think we've certainly
Speaker 1: got a down draft, uh more of a down draft
Speaker 1: from from some point here. I don't know how much
Speaker 1: further this rally can go. We're seeing it fade a
Speaker 1: little bit as we get into trading today. You know,
Speaker 1: very strong rally yesterday, Futures were strong again this morning,
Speaker 1: started to fade a little bit. It's it's it's uh,
Speaker 1: you know, come and go today through trading this morning.
Speaker 1: But um, you know, we we see, you know, we're
Speaker 1: in a what we're calling right now an event driven
Speaker 1: bear market, not a not a secular bear market, not
Speaker 1: a you know, we don't think that this is a
Speaker 1: more than too an O eight O nine top type
Speaker 1: of bear market, that this is still just an event
Speaker 1: driven beer market that will just last a few short
Speaker 1: months and not a couple of years or or or
Speaker 1: uh a year or longer. We think that we're coming
Speaker 1: out of this and by the end of the year
Speaker 1: the economy and stock market will be on pretty good
Speaker 1: footing again. Um, that's yet to be seen, but that's
Speaker 1: that's our forecast right now. The economy and the stock
Speaker 1: market are two very different things. And there's a feeling
Speaker 1: that the stock market might recovery, but the economy the
Speaker 1: economic hit. Very few people at this point are are
Speaker 1: putting conviction behind a V shaped recovery in the economy.
Speaker 1: What gives you confidence that this will just be a
Speaker 1: couple of months and then all those jobs will come back.
Speaker 1: I guess it's it's it really comes down to, and
Speaker 1: we don't know right it. It comes down to how
Speaker 1: long the social distancing needs to go on, um, how
Speaker 1: the data coming in relative to the number of new cases.
Speaker 1: And then what we talked about earlier on how uh
Speaker 1: the consumers re engage the economy, how people get back
Speaker 1: to work. Um, the the uh you know, continuation of
Speaker 1: or the continuation of unemployment for a period of time.
Speaker 1: The longer goes, the more businesses to go out of business,
Speaker 1: the more people that are suffering that much longer makes
Speaker 1: it that much harder to restart the economy and and
Speaker 1: starts to manifest into longer term effects. That's the that's
Speaker 1: the risk. So the sooner we restart the economy, and
Speaker 1: I'm not suggesting we do that, it's got to be
Speaker 1: health and safety first. But the sooner we restart the economy,
Speaker 1: the less the effects will be. If you look at
Speaker 1: China as a model, um and as much as we
Speaker 1: believe the data and the recovery, but there's you know,
Speaker 1: there's measurements that we're taking that are being taken to
Speaker 1: to see that what the real recovery rate is there
Speaker 1: and how much factories are actually running and so forth.
Speaker 1: But they really did have somewhat of a V shaped
Speaker 1: recovery in a matter of a few months from the
Speaker 1: time they went down to come back up. They're not
Speaker 1: running it full production now. It's questionable as to what
Speaker 1: market sign ship too, but you know there's a model
Speaker 1: where it all happened literally in a few months. Yeah,
Speaker 1: David Couldla, thank you so much for being with us.
Speaker 1: David Couldla, chief executive officer and chief investment strategist at
Speaker 1: Mainstay Capital Management with nearly three billion dollars joining us
Speaker 1: from Michigan. There's a question right now about the progress
Speaker 1: of the coronavirus and some of the measures put in
Speaker 1: place to limit a limited spread in Europe. They appear
Speaker 1: to be working. However, we did see an increase in
Speaker 1: the number of deaths in Spain, and there is a
Speaker 1: question right now around the leadership of the United Kingdom.
Speaker 1: Is Boris Johnson, the Prime Minister is still in the
Speaker 1: hospital and in an intensive care unit being treated for
Speaker 1: the coronavirus. For some insight on what we should take
Speaker 1: away from this episode, let's bring in to raise Raphael Bloomberg,
Speaker 1: opinion editor covering European politics and economics. Trace, of course,
Speaker 1: our thoughts are with Boris Johnson, hoping that he does
Speaker 1: recover from the virus. On a bigger level, though, is
Speaker 1: there anything that we can take away in terms of
Speaker 1: the leadership of the United Kingdom throughout this epidemic as
Speaker 1: well as beyond and what the future brings in terms
Speaker 1: of Boris Johnson's government, Well, the UK does not, like
Speaker 1: the US, have a vice president or vice prime minister role.
Speaker 1: There's no constitutionally designated number two at present. Foreign Secretary
Speaker 1: Dominique rob a cabinet member and one time rival to
Speaker 1: Boris Johnson, has been designated as his stand in for
Speaker 1: day to day policy meetings, and the cabinet is says
Speaker 1: it's taking decisions by consensus now that can continue for
Speaker 1: a while. Should Johnson become UH seriously incapacitated, should he
Speaker 1: sign UH, then it's a different process. The Cabinet would
Speaker 1: then choose a member to recommend to the Queen to
Speaker 1: become prime minister. There's no acting prime ministerial role in
Speaker 1: the UK constitution. They would simply become prime minister. But
Speaker 1: I think that's sort of getting ahead of ourselves. Johnson,
Speaker 1: the news out this afternoon is in good spirits and stable.
Speaker 1: He's not on a ventilator, as you said in your introduction,
Speaker 1: so the hope is that he will be able to
Speaker 1: return to full work. Um whether that will happen in
Speaker 1: a few days or much further into the future isn't clear.
Speaker 1: And Soris forgive me for being I don't want to
Speaker 1: say cynical, but cynical. We got communication out of the
Speaker 1: United Kingdom the forest Johnson was totally fine, they were
Speaker 1: mild symptoms. Then we got information that he was just
Speaker 1: brought to the hospital for a precautionary check. It was
Speaker 1: just a precautionary measure. Stopped getting your nose. A lot
Speaker 1: of joint about it. It's no big deal. Then we
Speaker 1: hear he's in the ICU, but he's not an a ventilator.
Speaker 1: He's fine in everything is copasetic. Is there a trust
Speaker 1: issue here or you know, is this just sort of
Speaker 1: a protocol for a leader of a nation. Yeah, I mean,
Speaker 1: I wish I could answer that with any great certainty.
Speaker 1: There are moments when it has felt a little bit um,
Speaker 1: you know, like uh, you know, like watching the old
Speaker 1: Soviet leaders and wondering what's happening. I think what we
Speaker 1: have to bear in mind is that this virus um
Speaker 1: operates in in sort of strange and mysterious ways. There
Speaker 1: are cases where a COVID nineteen uh suffer will the
Speaker 1: experiencing fairly moderate symptoms that persist and within hours it
Speaker 1: gets much worse. So it may be that uh, the
Speaker 1: the Downing Street was putting a positive spin on things.
Speaker 1: And it may also be that the Prime Minister, who
Speaker 1: we know, uh, you know, we know from his biographer
Speaker 1: that he doesn't believe in illness. He tends to work
Speaker 1: through illnesses. He doesn't really tolerate it in his staff
Speaker 1: that he may have just been pushing himself, not being
Speaker 1: quite um, you know, as as uh as careful about
Speaker 1: you know, looking after himself and resting, and things might
Speaker 1: have deteriorated quite quickly. I think we're not going to
Speaker 1: know that for a while. The Downing Street is going
Speaker 1: out of its way right now to say that they
Speaker 1: are being transparent. They're updating the media regularly. Um. But
Speaker 1: that's a legitimate question and many here are asking it.
Speaker 1: Just shifting gears to the continent of Europe, there is
Speaker 1: some talk about reopening parts of certain economies as the
Speaker 1: virus does appear to be plateau ing when it comes
Speaker 1: to the account of deaths in new cases in certain hotspots,
Speaker 1: I'm wondering what the latest is on that. Well, the
Speaker 1: epidemiological curve is at a different place, or let's put
Speaker 1: it at this way. Different countries are on a different
Speaker 1: places on that curve, and those that have taken earlier
Speaker 1: measures or whose um death rates and infection rates are slowing,
Speaker 1: are now starting to contemplate um loosening those measure us.
Speaker 1: But it's a very uh, it's a very finally balanced
Speaker 1: decision because there is no vaccine. As we know, there
Speaker 1: won't be a vaccine most likely for a while, and
Speaker 1: there's always a risk that in loosening UH controls you
Speaker 1: see another surge of infections, and then it then becomes harder,
Speaker 1: as the a team that advises Boris Johnson keeps saying,
Speaker 1: it becomes harder to re reimpose those controls after people
Speaker 1: sort of you know, get a taste of of having
Speaker 1: some freedom. So I think we're likely to see this
Speaker 1: progressing by fits and starts. Perhaps some schools will reopen,
Speaker 1: or certain um you know, still fairly essential businesses will
Speaker 1: be allowed to operate, not but people will still be
Speaker 1: encouraged to work from home and that sort of thing.
Speaker 1: There's also discussion of issuing immunity passport, so those who
Speaker 1: have tested positive in the past, have had COVID nineteen
Speaker 1: or who antibody tests show UM have had it, even
Speaker 1: if they didn't experience symptoms, would be given so kind
Speaker 1: of certification so that they could use public transport, return
Speaker 1: to work, and communicate to you know, to anyone that
Speaker 1: they are not UM, that they are not infectious. But
Speaker 1: that depends on getting the disease being a sort of
Speaker 1: one and done rather than something that can you can
Speaker 1: be reinfected within a short period afterwards. Torereas Rafael. We
Speaker 1: are all living in a science fiction novel at Toreas Rafael,
Speaker 1: Bloomberg opinion editor covering European politics and economics. It does
Speaker 1: feel like it is a scene out of some sort
Speaker 1: of surreal science fiction when everybody is being tested for
Speaker 1: their immunological defense mechanisms to this virus going forward. Thanks
Speaker 1: for listening to the Bloomberg pen L podcast. You can
Speaker 1: subscribe and listen to interviews at Apple Podcasts or whatever
Speaker 1: podcast platform you prefer. Paul Sweeney, I'm on Twitter at
Speaker 1: pt Sweeney and Lisa A. Bramoids I'm on Twitter at
Speaker 1: Lisa A. Bramoids one before the podcast, you can always
Speaker 1: catch us worldwide. I'm Bloomberg Radio Monty