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Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside

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Speaker 1: my co host Matt Miller.

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Speaker 2: Every business day, we bring you interviews from CEOs, market pros,

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Speaker 2: and Bloomberg experts, along with essential market moven news.

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Speaker 1: Find the Bloomberg Markets Podcast on Apple Podcasts or wherever

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Speaker 1: you listen to podcasts, and at Bloomberg dot com slash podcast.

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Speaker 1: I mean, today's tape basically unchanged. It kind of feels

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Speaker 1: kind of like where we are overall in these markets

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Speaker 1: here feels range bound, as we've heard from some guests

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Speaker 1: kind of to suggest, and the question is, you know,

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Speaker 1: kind of what moves you out of that range. Maybe

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Speaker 1: our next guest has some thoughts here. Joe Mazzola, he's

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Speaker 1: over at Schwab. He is the managing director of Trading

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Speaker 1: Education at Charles Schwab.

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Speaker 3: I mean, Joe, you're at Schwab.

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Speaker 1: You guys see everybody, You see everything out there because

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Speaker 1: you have so many clients out there. What do you

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Speaker 1: feel like investors are kind of the biggest issue for

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Speaker 1: investors right here.

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Speaker 4: I think there's probably three things that investors that are

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Speaker 4: really kind of keying on right now, you know, interest

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Speaker 4: rates being number one, you guys just kind of let

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Speaker 4: into that, you know, back around four and a half percent,

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Speaker 4: four point five to five and the tenure. I don't

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Speaker 4: think it's it's the it's the move itself. It's the

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Speaker 4: magnitude and how quickly it moved. I think that's shaken

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Speaker 4: markets up quite a bit. I think the second thing

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Speaker 4: is the political landscape, and you know, there is more

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Speaker 4: risks around a government shutdown. We you know, I think

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Speaker 4: maybe we sit back and say, wow, you know this

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Speaker 4: this will work itself out, but there's real risk that

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Speaker 4: this could this could carry on for a while and

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Speaker 4: could have some economic impacts. I think the last thing,

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Speaker 4: and probably maybe front and center and investors' minds, is

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Speaker 4: inflation data.

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Speaker 5: It did seem like it was subdued over the summer.

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Speaker 4: It seemed like, you know, people were kind of able

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Speaker 4: to kind of get ahead of it and see the

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Speaker 4: end in sight.

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Speaker 5: But we started to see it kind of tick back up.

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Speaker 5: We get PC data.

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Speaker 4: On Friday, so it'll give us a little bit more

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Speaker 4: of an indication on where we're at. But that's absolutely

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Speaker 4: front and center for our investor's mind.

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Speaker 2: Gabagail do little, Abigail do a little looks at the

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Speaker 2: technical analysis and she thinks we could float down below

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Speaker 2: forty two hundred on the S and P five hundred.

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Speaker 2: I guess I would imagine that retail investors look at

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Speaker 2: these yields and find them attractive, especially versus stocks. Right now,

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Speaker 2: how are your clients trading it?

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Speaker 4: So we look at a couple of things, right we

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Speaker 4: look at the S ANDP earnings yield versus the tenure yield.

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Speaker 4: Then you look at that spread, and we're back at

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Speaker 4: levels that we really haven't seen since prior to the

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Speaker 4: Great Financial Crisis. Meaning look that whole Tina talk that

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Speaker 4: we've had for what fifteen years? I mean, that's out

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Speaker 4: the window. There is an alternative, there's an alternative. And

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Speaker 4: fixed income, there's an alternative. In money markets. A lot

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Speaker 4: of investors are comfortable just kind of sitting in five

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Speaker 4: percent yield and waiting for the market to work itself out.

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Speaker 4: I agree one hundred percent. And looking at some of

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Speaker 4: these technical levels right now, it does seem like, you know,

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Speaker 4: we've moved into a bit of a lower range. And

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Speaker 4: the reason I say that is because you know, we

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Speaker 4: broke that forty three to fifty range. I think we

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Speaker 4: have some some room to potentially go maybe down to

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Speaker 4: about forty two to ten, where you might see a

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Speaker 4: bit of a bounce. That's kind of that intersection of

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Speaker 4: where the two hundre day moving average is sitting right

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Speaker 4: around forty two hundred. But we also have a Fibinacci

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Speaker 4: retracem the level from the one year highs right around

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Speaker 4: that level as well.

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Speaker 6: Two.

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Speaker 4: But a couple of things that I've been paying attention to,

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Speaker 4: and you know a lot of our traders and investors

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Speaker 4: been talking to us about, is this idea of the

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Speaker 4: market breadth and.

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Speaker 5: How it's really weakening.

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Speaker 4: We're just not seeing a bounce, and we're not seeing

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Speaker 4: it across the whole spectrum, if anything. Really, the only

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Speaker 4: sector that's held up well is energy, with about ninety

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Speaker 4: percent of its components in the S and P five

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Speaker 4: hundred up above its fifty day moving average. But when

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Speaker 4: you look at the S and P five hundred as

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Speaker 4: a whole, we're around twenty five percent of the S

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Speaker 4: and P five hundred up above its fifty day moving average.

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Speaker 4: And that's just not it's not at a level that

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Speaker 4: supports a bounds. Now, what I'd like to see is

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Speaker 4: I'd like to see a little bit more of a washout.

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Speaker 4: I'd like to see us get down maybe around that

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Speaker 4: ten or twelve percent level to see if we get

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Speaker 4: a bounce from there. At that point, maybe you know,

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Speaker 4: some of that polishness kind of fades from the market.

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Speaker 4: You might start to see some you know, that that

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Speaker 4: washout occur where buyers might start step back in.

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Speaker 1: Hey, Joe, you know when you when you talk to

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Speaker 1: the bloom the shrub customers, what are some of the

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Speaker 1: sectors that they like right here? I mean it was

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Speaker 1: if you just kind of look back at this year

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Speaker 1: to date, if you owned you know, the Magnificent seven, boy,

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Speaker 1: this has been a great year. What are they most

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Speaker 1: bullsh on at this point? Or maybe what are they

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Speaker 1: most concerned about?

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Speaker 4: Yeah, as rob customers for sure are looking at really

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Speaker 4: two sectors right now, Energy and they've done well in

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Speaker 4: that over.

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Speaker 5: The last couple of months.

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Speaker 4: I think, you know, if you look at a sector

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Speaker 4: as a whole over the last month, it's over double

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Speaker 4: digits and then information technology. So it so they continue

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Speaker 4: to be buyers there. They're looking for opportunities on selloffs

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Speaker 4: to kind of step in and buy at those levels.

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Speaker 4: But those are the two right now that they're really

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Speaker 4: looking at the ones that they are really shying away

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Speaker 4: from our real estate utilities.

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Speaker 5: Those are the ones that they're very pay or shoun

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Speaker 5: right now.

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Speaker 7: In terms of real estate.

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Speaker 2: Is it a problem, you know, with these higher rates,

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Speaker 2: with higher mortgages, with refinancings coming to I mean both

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Speaker 2: on the retail and sorry residential and on the commercial side,

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Speaker 2: there are some big question marks there now.

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Speaker 5: I think you hit a nail on the head.

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Speaker 4: I think when you're starting to look at a thirty

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Speaker 4: year fixed mortgage up above seven percent, you know, seven

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Speaker 4: point one, seven point one five percent at this point

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Speaker 4: right now, I mean, just look at look at what

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Speaker 4: we've seen in existing homes. I think ninety percent of

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Speaker 4: the US has a mortgage under five percent. What's the

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Speaker 4: impetus to move to a new home. I think they're

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Speaker 4: kind of sitting still, and that's cut down on supply,

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Speaker 4: which you know, to a certain extent, is held housing

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Speaker 4: prices in check. It hasn't. We haven't really seen a

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Speaker 4: big decrease in housing price. At the same time, it's

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Speaker 4: just not really providing the catalyst for people to move now,

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Speaker 4: until you start to see a real break there. I

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Speaker 4: know there is some pent of demand and supply apply

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Speaker 4: is starting to hit. We've seen that on the new

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Speaker 4: home sales exceeding existing home sales, and we've seen that

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Speaker 4: spread continue now for basically a year. But until you

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Speaker 4: start to see those mortgage rates kind of take back down,

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Speaker 4: I don't think you're going to see a lot of

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Speaker 4: buying momentum there.

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Speaker 1: So, Joe, the good folks at SCHWAP, are you, guys,

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Speaker 1: is it your base case that we're going to have

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Speaker 1: a recession and if so, when or what do you

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Speaker 1: think we can skatee past one?

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Speaker 4: Well, I could tell you what our investors and what

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Speaker 4: our trade is telling us about sixty nine percent of

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Speaker 4: them do believe that a recession is coming.

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Speaker 5: But they do believe that it'll last.

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Speaker 4: Less than a year and it might not be as

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Speaker 4: deep as as maybe some are predicting. I think that

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Speaker 4: the belief is that, you know, it'll happen in twenty

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Speaker 4: twenty four, and they're kind of they're constantly looking at

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Speaker 4: this battle between the soft landing a scenario in a recession,

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Speaker 4: and I think they're probably skewing a little bit more

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Speaker 4: towards recession side at this point.

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Speaker 2: So do people back up into these rates do you buy, uh,

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Speaker 2: you know, treasuries and even maybe go along a little

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Speaker 2: bit duration if you're if you're worried about a recession.

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Speaker 5: Well, I'm not a fixed income guy, but I can

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Speaker 5: tell you, you know what our traders are.

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Speaker 4: Telling us, and they have been bearish on but they,

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Speaker 4: let me rephrase that, they've been a little bit more

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Speaker 4: bearish on bonds and then than they were in Q two.

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Speaker 4: So the Q three survey, they pull back some of

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Speaker 4: that excitement towards bonds. But I think that what we're

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Speaker 4: starting to see now is maybe a little bit movement

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Speaker 4: back into that into that sector. And we're starting to

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Speaker 4: see it, of course on the money market side as

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Speaker 4: well too, as people are kind of waiting for a

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Speaker 4: correction in the market. I think the thing that's frustrating

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Speaker 4: for investors right now is it's kind of a slow

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Speaker 4: grind down, right. I mean, we're not really seeing a

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Speaker 4: big pop in the VIX. You know, we're still below twenty.

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Speaker 4: We haven't really seen a big pop in the move

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Speaker 4: index on the fixed income side, which is showing that

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Speaker 4: you know, investors and traders not they're not comfortable at

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Speaker 4: this level.

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Speaker 5: But at the same time they're not panicking either. That's

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Speaker 5: why I talk about that wash out.

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Speaker 4: Until we see that wash out, I think we just

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Speaker 4: can continue to see this grind down within this lower range.

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Speaker 1: Hey, Joe, thanks so much for joining us. Really appreciate it.

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Speaker 1: Joe Mazzola. He's a managing director and trading education at

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Speaker 1: Charles Schwab.

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Speaker 8: You're listening to the team Ken's are Live program Bloomberg

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Speaker 8: Markets weekdays at ten am Eastern on Bloomberg dot com,

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Speaker 8: the iHeartRadio app, and the Bloomberg Business App, or listen

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Speaker 8: on demand wherever you get your podcasts.

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Speaker 3: Jackie Bowie joins us.

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Speaker 1: She's a managing partner and head of e m EA

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Speaker 1: at Chatham Financial. Jackie, you know investors here and folks

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Speaker 1: here in the States, we kind of feel like our

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Speaker 1: economy's okay. You know, inflation with like inflation to come

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Speaker 1: down a little bit more. Higher rates are hurting, like

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Speaker 1: if you want to go out and buy a house.

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Speaker 1: But generally things are okay.

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Speaker 5: Here.

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Speaker 1: People feel like I think generally things are kind of

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Speaker 1: in a right direction, but Europe not so much. Talk

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Speaker 1: to us about kind of the the economic backdrop that

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Speaker 1: European investors and investors that invest in em mea over

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Speaker 1: in Europe and emerging markets, what are they dealing with?

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Speaker 9: Well, I guess the trends are very similar around you know,

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Speaker 9: higher inflation, higher interest rates, and a concern that those

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Speaker 9: interest rates are starting to impact the real economy. I

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Speaker 9: think the differences in Europe and in the UK is

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Speaker 9: that getting inflation under control has not been quite as successful,

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Speaker 9: you could say, as the Fed have managed to do.

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Speaker 9: And there's also a huge divergence within the economies. So

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Speaker 9: we think about the EU as a you know, one

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Speaker 9: geographic zone, but in fact, if you look at the

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Speaker 9: economic performance of Germany for example, in recession, very industrial

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Speaker 9: economy not doing well, versus like Spain and Ireland who

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Speaker 9: are showing decent growth. So it's hard to make a

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Speaker 9: uniform statement across the board, and certainly a lot of

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Speaker 9: divergence between the individual country performance.

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Speaker 2: How difficult are higher commodity prices? You know, last year

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Speaker 2: we were really worried about Germany and continental Europe as

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Speaker 2: gas prices rose up. They managed to avoid taking a

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Speaker 2: huge hit from that by storing enough.

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Speaker 7: But is it still a concern?

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Speaker 9: Definitely, and I think it's a real concern right down

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Speaker 9: to the consumer level in terms of perception, because as

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Speaker 9: soon as the headlines start to come through, you particularly

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Speaker 9: about the oil price, everyone realizes how much that really

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Speaker 9: impacts what they payple for energy and also the cost

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Speaker 9: of fuel at the pump here in Europe in the UK,

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Speaker 9: which is much higher than it is in the US.

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Speaker 9: So I think there's a bit of a concern that

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Speaker 9: if consumers start to see that, they will then start

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Speaker 9: to renin spending as they prepare for perhaps another win

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Speaker 9: to significantly higher energy costs in Germany.

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Speaker 1: I mean, I guess there's such an I guess the

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Speaker 1: importance of China as a trading partner, and the China

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Speaker 1: reopening has been disappointing relative to I guess maybe the

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Speaker 1: beginning of the year expectation. How is Germany and its

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Speaker 1: economy dealing.

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Speaker 9: With that, well, if you look at the headline numbers

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Speaker 9: of the GDP levels, you could say not very well.

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Speaker 9: So as you imply, Germany is obviously a big expert

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Speaker 9: economy and pretty much reliant on a lot of those

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Speaker 9: overseas markets. China is being just one of them, you know.

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Speaker 9: And if we think what happened through the pandemic where

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Speaker 9: we had supply chain issues, which was then impacting growth,

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Speaker 9: and now we have it on the demand side. So

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Speaker 9: we've gone through a full cycle with none of the

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Speaker 9: upside of the upcycle because you've had a bit of

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Speaker 9: a double whammy on either side of that. I mean,

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Speaker 9: there are other things that are specific to the German economy,

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Speaker 9: a whole other topics around the green agenda and the

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Speaker 9: cost for businesses to try and comply with what Germany

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Speaker 9: are trying to do around sort of green and sustainable policies,

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Speaker 9: which is definitely impacting the economy as well.

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Speaker 2: Is that not Is the green transition not going to

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Speaker 2: be a driver of growth down the road? I mean,

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Speaker 2: I look at expectations for the German economy and their law.

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Speaker 2: Obviously we're looking for a contraction this year and only

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Speaker 2: zero point six percent GP growth next year. But is

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Speaker 2: the green transition going to be a driver there? Or

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Speaker 2: is Germany going to be penalized by its reliance on

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Speaker 2: the internal combustion engine industry.

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Speaker 9: Yeah. I think if we were to look ten years

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Speaker 9: ahead and then look retrospectively, you might be able to

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Speaker 9: say that the transition to green overall created jobs, created growth.

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Speaker 9: I think the pain comes in the transition period. If

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Speaker 9: you look at the number of people who are still

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Speaker 9: employed in industries around fossil fuels, around the automotive industry

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Speaker 9: as in you know, few powered cars, not electric cars.

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Speaker 9: It's huge and you don't just get an automatic replacement

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Speaker 9: of them, you get a displacement which impacts the economy

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Speaker 9: before call it the new green economy starts to take off.

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Speaker 9: And I think there are more concerns that the short

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Speaker 9: term pain of pushing towards sustainable policies. The same in

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Speaker 9: the UK, and you know, our prime ministers now starting

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Speaker 9: to rein that in a little because they realizes that

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Speaker 9: the transition period will be painful.

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Speaker 7: By the way, how's Brexit been twenty sixteen?

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Speaker 8: Right?

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Speaker 7: Was that twenty sixteen?

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Speaker 2: So seven years on are you are you just reveling

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Speaker 2: in the benefits of independence? I mean, has it been

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Speaker 2: just an amazing weight lifted from your shoulders, the freedom

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Speaker 2: of doing it on your own, all.

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Speaker 7: The incredible trade deals that you've made. I mean, what courage,

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Speaker 7: What courage that took.

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Speaker 5: Yeah.

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Speaker 9: So I think the idea of Brexit was had lots

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Speaker 9: of very positive components. The challenge for the UK government

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Speaker 9: was in the execution plan and circling through for prime

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Speaker 9: ministers in that time to try and execute the plan

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Speaker 9: in the middle of a global pandemic meant that getting

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Speaker 9: those big trade deals done was definitely more of a challenge.

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Speaker 2: And of course you're partying right, they shouldn't have partied

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Speaker 2: so much.

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Speaker 9: Got to let their hair down. And I think the

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Speaker 9: issue now, you know, just coming into the political cycle.

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Speaker 9: I know it's the same in the US as we

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Speaker 9: come into twenty twenty four that we're starting to see,

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Speaker 9: you know, really big shifts in the sort of left

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Speaker 9: to right movement or wherever way you want to look

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Speaker 9: at it, in the direction of travel. Where you know,

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Speaker 9: in the UK the leading party in the polls is

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Speaker 9: making very clear signs about a much closer relationship with

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Speaker 9: the EU Again, so just as businesses have got used

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Speaker 9: to the new operating environment, you start to sort of

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Speaker 9: inject more of that uncertainty back in. So we'll see

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Speaker 9: how the politics shape up next year.

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Speaker 1: Jackie, thanks so much for joining us. I really appreciate

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Speaker 1: it getting your views. Jackie Bowie, Managing Partner and head

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Speaker 1: of E M e A at Chatham Financial based in London.

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Speaker 8: You're listening to the tape Cat's are live program Bloomberg

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Speaker 8: Markets weekdays at ten am Eastern on Bloomberg Radio, the

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Speaker 8: tune in app, Bloomberg dot Com, and the Bloomberg Business App.

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Speaker 8: flagship New York station. Just say Alexa Play Bloomberg eleven thirty.

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Speaker 1: Former colleague device Callie Cox back in the studio, US

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Speaker 1: investment analyst with E.

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Speaker 7: Touro, So, Kelly, what do.

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Speaker 1: You make of this market? I mean there's people lass,

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Speaker 1: you know, four or five weeks, people have gotten very

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Speaker 1: nervous here about this whole interest rate environment and what

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Speaker 1: it may mean a how to risk assets perform in

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Speaker 1: a higher for longer environment. But does that really bring

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Speaker 1: back onto the table recession? How do you guys think

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Speaker 1: about that right here?

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Speaker 10: Yeah, well, we see people building a wall of worry

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Speaker 10: and we think that's a good thing. And I'm not

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Speaker 10: trying to be overally optimistic here, but if you think

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Speaker 10: about this list of worries that we're going through, student

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Speaker 10: loan payments restarting, if you think about you know, higher oil,

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Speaker 10: higher yield's, potential government shut down, there's a reason why

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Speaker 10: people are nervous. But put them all together, and I

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Speaker 10: can only count a few of those as actual systemic

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Speaker 10: risks to the economy. So that's what we're telling customers.

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Speaker 10: Keep an eye on oil, keep an eye on yields,

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Speaker 10: even though yields are telling us a good thing. Still

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Speaker 10: pressure on the economy and markets, but everything else might

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Speaker 10: just be a distraction.

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Speaker 1: All right, So I'm sorry, but you sound still pretty

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Speaker 1: constructive on these markets here.

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Speaker 10: We're I hate this phrase, but cautiously optimistic. We're constructive,

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Speaker 10: but we're also asking people to really tread carefully and

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Speaker 10: pick up quality risk, don't go all out here. I mean,

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Speaker 10: we are in a bull market until proven otherwise, until

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Speaker 10: we see that recession or that crisis. Right now, there

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Speaker 10: are a few signs of that, but at the same time,

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Speaker 10: we don't know what cracks could be forming underneath the surface.

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Speaker 2: So how worried are you about the government shut down

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Speaker 2: which is very likely to come this weekend? The strikes,

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Speaker 2: the UAW strikes being prong I mean, is this a

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Speaker 2: factor in your analysis?

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Speaker 10: Yeah, So we think about the strikes and the shutdown

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Speaker 10: a bit differently. Even though the strike the shutdown is

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Speaker 10: kind of like a like a four strike from government employees, right,

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Speaker 10: So the UAW strike, of course, is front and center

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Speaker 10: of our minds, especially because we have a lot of

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Speaker 10: investors who own auto stocks, and this is a big

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Speaker 10: deal for the auto industry. I mean, luckily, we're talking

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Speaker 10: about US production here, and US production is just a

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Speaker 10: small share of global car production. I mean, US consumers

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Speaker 10: use a lot of cars, but they don't exactly produce

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Speaker 10: a lot of them, so we think global production could

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Speaker 10: fill the gap there. But at the same time, I mean,

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Speaker 10: this is another worry to lop on top of an

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Speaker 10: economy that's under a lot of pressure. Government shutdown again.

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Speaker 10: I mean, if you look historically, they haven't made much

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Speaker 10: of a dent in either the economy or markets. It's

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Speaker 10: usually just a distraction. But going back to systemic risk,

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Speaker 10: I mean, we don't know what's happening underneath the surface,

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Speaker 10: and you know, we're encouraging people to not freak out

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Speaker 10: too much, but understand that this is just another you know,

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Speaker 10: piece of pressure. Sure that you know investors have to

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Speaker 10: think about.

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Speaker 1: Well, why don't I just sit my two year treasury

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Speaker 1: at five point one percent? That's pretty good.

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Speaker 10: I mean a lot of people are doing that.

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Speaker 1: I mean, is that something you guys I mean, is

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Speaker 1: that something you guys are seeing from your clients or

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Speaker 1: hearing from your clients, and what are you telling them

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Speaker 1: about that?

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Speaker 7: Oh?

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Speaker 10: Yeah, we hear it all the time. We did a

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Speaker 10: webinar with clients yesterday and that was one of the

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Speaker 10: first questions that came up. And it's a very fair question.

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Speaker 10: I mean, that's the five percent is the most you've

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Speaker 10: been able to get on money in thirty years. So

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Speaker 10: we frame it like this. I mean, timeframes matter a

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Speaker 10: lot when it comes to considering whether to go into

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Speaker 10: cash or go into equities, or basically when you're determining

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Speaker 10: how much risk you're taking on here, because cash at

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Speaker 10: five percent is great for short term goals. But remember

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Speaker 10: that yields are probably not going to go much higher

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Speaker 10: from here. The economy is probably going to slow down

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Speaker 10: from this five percent annualized pace. People think we're growing

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Speaker 10: out in the third quarter. And if that's the case,

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Speaker 10: if the Fed starts cutting rates into next year, you know,

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Speaker 10: that's the rate that you're getting paid on your cash

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Speaker 10: and you know, on your bonds, unless you, of course

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Speaker 10: hold them to maturity. So you know, we have a

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Speaker 10: lot of longer term investors on the platform well.

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Speaker 2: If you get five percent, you know on a twenty

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Speaker 2: year you're getting that for the next two decades plus

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Speaker 2: the appreciation. If yields go down, your capital is then

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Speaker 2: worth more.

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Speaker 7: Yeah.

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Speaker 10: Yeah, and it's tempting, but you also have to remember

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Speaker 10: the S and P has a seven percent average annual

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Speaker 10: return and that compounds as well over the years. So,

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Speaker 10: you know, with younger investors, with a lot of millennials

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Speaker 10: and Gen zs on the platform, we tell them to

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Speaker 10: think about the fact that they have time on their side,

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Speaker 10: so cash is good, but you know, you really have

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Speaker 10: to think in the gray area as.

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Speaker 3: When who is a typically TURO client customer.

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Speaker 10: So we we skew towards the you know, older millennials

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Speaker 10: and the Gen x's, but we do have a younger

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Speaker 10: investor base when compared to other traditionals.

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Speaker 1: And did they invest differently, did they think differently or

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Speaker 1: do they just or is it just simply hey, you

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Speaker 1: guys are young. You need to think longer term, and

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Speaker 1: over the long term stocks outperform most other asset classes.

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Speaker 3: Is that kind of the base message, Well.

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Speaker 10: They're a little more complicated than that. A lot of

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Speaker 10: our customers are those long term investors, but they have

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Speaker 10: that active account on the side. They're interested in crypto,

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Speaker 10: they're interested in investing with a community.

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Speaker 1: Because we never talk about crypto anymore. It seems like

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Speaker 1: it was almost every day, and I used to quote

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Speaker 1: it all the time.

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Speaker 3: Is but now we don't talk about it.

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Speaker 2: Why bother it's just twenty six thousand without looking let

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Speaker 2: me see, I I haven't looked today, but you're probably

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Speaker 2: pretty close. And I mean twenty six I think it's

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Speaker 2: more interesting to talk about investing with the community.

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Speaker 7: So what exactly does that mean?

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Speaker 2: Somebody has a model portfolio, you might like it, and

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Speaker 2: you can then clone that portfolio like like tracking an index.

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Speaker 10: Yes, so we offer that for crypto, Matt. We call

442
00:20:41,080 --> 00:20:44,000
Speaker 10: that are not our smart portfolios. But you know, being

443
00:20:44,040 --> 00:20:46,399
Speaker 10: able to follow somebody and being able to invest if

444
00:20:46,440 --> 00:20:49,320
Speaker 10: you like the crypto, their crypto that they're investing in.

445
00:20:49,560 --> 00:20:51,720
Speaker 10: I mean, that's what we're trying to promote here. We're

446
00:20:51,720 --> 00:20:55,159
Speaker 10: trying to promote the transition of ideas. You know, the

447
00:20:55,200 --> 00:20:57,720
Speaker 10: ability to talk about what you're investing in and the

448
00:20:57,760 --> 00:21:00,280
Speaker 10: ability to see what other people are investing in as

449
00:21:00,440 --> 00:21:02,520
Speaker 10: a track record type thing. You know, these are my

450
00:21:02,640 --> 00:21:05,439
Speaker 10: returns this is what I have in my portfolio. You know,

451
00:21:05,480 --> 00:21:09,120
Speaker 10: if you see yourself as a similar investor, then you know.

452
00:21:09,119 --> 00:21:11,439
Speaker 7: Maybe is it only for crypto? I mean, can I not?

453
00:21:11,920 --> 00:21:14,320
Speaker 2: Like if Paul goes on there, can he put you know,

454
00:21:14,400 --> 00:21:18,040
Speaker 2: his munis and all of that sort of baby boomer

455
00:21:18,040 --> 00:21:20,000
Speaker 2: stuff on there, and I can say I want a

456
00:21:20,040 --> 00:21:23,439
Speaker 2: boomer account, so I just clone his account and do

457
00:21:23,560 --> 00:21:24,080
Speaker 2: the same thing.

458
00:21:24,800 --> 00:21:27,760
Speaker 10: Not in the US yet, but we're hopefully working toward that,

459
00:21:27,880 --> 00:21:29,720
Speaker 10: and Paul, if we get there, I would love to

460
00:21:29,720 --> 00:21:31,560
Speaker 10: create a baby boomer portfolio just for you.

461
00:21:31,680 --> 00:21:32,119
Speaker 3: There we go.

462
00:21:32,160 --> 00:21:34,800
Speaker 2: See he's the tail end, he's the last, he's the

463
00:21:34,880 --> 00:21:36,720
Speaker 2: last month of baby boomers.

464
00:21:36,920 --> 00:21:38,439
Speaker 3: Literally, he's set.

465
00:21:38,359 --> 00:21:41,800
Speaker 1: For sixty three, John Tucker, he's more firmly asconced.

466
00:21:41,600 --> 00:21:45,080
Speaker 3: Within the you're closer, would you reach over and just smash?

467
00:21:46,280 --> 00:21:46,560
Speaker 5: All right?

468
00:21:46,600 --> 00:21:48,520
Speaker 1: So if I can do that, Kelly, what's kind of

469
00:21:48,520 --> 00:21:50,200
Speaker 1: the big issues that are coming up from your clients

470
00:21:50,240 --> 00:21:51,000
Speaker 1: you had the webinar?

471
00:21:51,920 --> 00:21:52,760
Speaker 7: What are they worried about?

472
00:21:52,800 --> 00:21:54,919
Speaker 3: What are they excited about? Your your clients?

473
00:21:55,359 --> 00:21:57,560
Speaker 10: Yeah, well they're worried about a recession. But the funny

474
00:21:57,560 --> 00:22:00,200
Speaker 10: thing is they feel really good about their financial situation

475
00:22:00,400 --> 00:22:02,960
Speaker 10: right now. They say I don't have a reason to

476
00:22:03,000 --> 00:22:05,560
Speaker 10: really change up my portfolio, but I'm frozen, you know,

477
00:22:05,640 --> 00:22:07,919
Speaker 10: I'm not quite sure what to do here, especially because

478
00:22:08,040 --> 00:22:11,000
Speaker 10: things just don't feel good around me. So we're encouraging

479
00:22:11,000 --> 00:22:14,240
Speaker 10: them to again focus on their whys, understand what they're

480
00:22:14,240 --> 00:22:16,359
Speaker 10: different accounts are for. You know, if they want to

481
00:22:16,359 --> 00:22:19,200
Speaker 10: be active, there are plenty of opportunities in this environment.

482
00:22:19,200 --> 00:22:20,960
Speaker 10: You just have to be careful. And on the long

483
00:22:21,080 --> 00:22:24,199
Speaker 10: term side. I mean, we're you know, we're quite optimistic

484
00:22:24,240 --> 00:22:27,480
Speaker 10: on the US economy over ten twenty years. Everybody is,

485
00:22:27,560 --> 00:22:29,560
Speaker 10: but you know, when you look over the next year,

486
00:22:29,920 --> 00:22:32,400
Speaker 10: you might have some chances to, you know, jump back

487
00:22:32,440 --> 00:22:33,160
Speaker 10: into a strong room.

488
00:22:33,160 --> 00:22:33,800
Speaker 3: Our ETFs.

489
00:22:34,280 --> 00:22:36,639
Speaker 1: I mean, you guys even recommend mutual funds or talk

490
00:22:36,680 --> 00:22:38,640
Speaker 1: about mutual funds or it's just ETFs now.

491
00:22:38,840 --> 00:22:41,119
Speaker 10: So we have ETFs on our platform, and we're actually

492
00:22:41,160 --> 00:22:44,000
Speaker 10: noticing that ETFs as a share of volume is growing.

493
00:22:44,080 --> 00:22:48,280
Speaker 10: Investors are looking toward diversifying their portfolios or looking toward

494
00:22:48,320 --> 00:22:51,320
Speaker 10: broader market and sector trends. So that's a trend that

495
00:22:51,320 --> 00:22:53,720
Speaker 10: we're watching closely. I feel like everybody is, but it's

496
00:22:53,760 --> 00:22:55,959
Speaker 10: something that the average investor is picking up on.

497
00:22:56,560 --> 00:22:58,520
Speaker 1: I can't even imagine like the future of the mutual

498
00:22:58,520 --> 00:22:59,040
Speaker 1: fund business.

499
00:22:59,080 --> 00:22:59,879
Speaker 3: I mean, if you.

500
00:23:00,040 --> 00:23:03,280
Speaker 1: Nless it's in a retirement account, why wouldn't you just

501
00:23:03,400 --> 00:23:04,520
Speaker 1: I don't really well.

502
00:23:04,440 --> 00:23:08,280
Speaker 2: But we haven't seen the continuation, not at last year's

503
00:23:08,320 --> 00:23:11,119
Speaker 2: pace of conversions to ETF right, which I don't know

504
00:23:11,160 --> 00:23:12,160
Speaker 2: why that slowed down.

505
00:23:12,160 --> 00:23:13,840
Speaker 7: In fact, that's a real conversion.

506
00:23:13,520 --> 00:23:14,720
Speaker 3: Of a mutual fund into an ETF.

507
00:23:14,800 --> 00:23:17,040
Speaker 2: Yeah, last year that was huge, right, and the beginning

508
00:23:17,080 --> 00:23:19,200
Speaker 2: of this year as well, it's kind of slowed down

509
00:23:19,240 --> 00:23:22,520
Speaker 2: a bit. But I can't imagine why you would want

510
00:23:22,560 --> 00:23:27,000
Speaker 2: a mutual fund rather than an ETF, other than you know,

511
00:23:28,359 --> 00:23:31,360
Speaker 2: you're not allowed to have ETFs in certain investment cases.

512
00:23:31,080 --> 00:23:32,719
Speaker 7: So you have to use mutual funds for that.

513
00:23:33,080 --> 00:23:35,240
Speaker 10: Yeah, that's the only case I can think of too.

514
00:23:35,280 --> 00:23:38,879
Speaker 10: I mean, as an investor myself, it's I have no

515
00:23:38,920 --> 00:23:40,440
Speaker 10: reason to use mutual funds.

516
00:23:40,160 --> 00:23:40,640
Speaker 3: All right, Matt.

517
00:23:41,040 --> 00:23:44,080
Speaker 1: Yesterday was the beginning in basketball preseason practice. So my

518
00:23:44,160 --> 00:23:48,359
Speaker 1: question to Cali, being a proud alum of that trade

519
00:23:48,400 --> 00:23:52,440
Speaker 1: school in Chapel Hill, North knowing it, I knew it.

520
00:23:52,920 --> 00:23:53,760
Speaker 7: She's a tar heel.

521
00:23:54,000 --> 00:23:56,320
Speaker 10: How is basketball season when you're talking to a Duke fan?

522
00:23:56,480 --> 00:23:59,040
Speaker 3: Yes, So what's the outlook for Chapel Hill this year?

523
00:23:59,520 --> 00:24:02,240
Speaker 10: Oh man, We've had a lot of turnover on our roster.

524
00:24:02,480 --> 00:24:05,680
Speaker 10: We have bay Cod, he's a big guy. He's really good.

525
00:24:05,720 --> 00:24:08,119
Speaker 10: But quite honestly, I mean the turnover we've seen it.

526
00:24:08,160 --> 00:24:10,119
Speaker 10: I think it's going to be really hard to tell what's.

527
00:24:10,000 --> 00:24:13,639
Speaker 2: Just historically in these conversations though, Kalie, don't you say, like,

528
00:24:14,000 --> 00:24:15,760
Speaker 2: I guess what Jordan didn't play at Duke?

529
00:24:16,119 --> 00:24:16,359
Speaker 7: Right?

530
00:24:16,560 --> 00:24:19,800
Speaker 10: I mean, that's the thing we can hang over your head, right.

531
00:24:19,920 --> 00:24:22,320
Speaker 1: Well, we always say the only person that can guard

532
00:24:22,520 --> 00:24:25,200
Speaker 1: or keep Michael Jordan down is Dean Smith, the coach.

533
00:24:25,400 --> 00:24:27,600
Speaker 1: He's the only one that could keep Jordan from doing

534
00:24:27,680 --> 00:24:30,680
Speaker 1: amazing things, Dean Smith by limiting, you know, the type

535
00:24:30,680 --> 00:24:31,200
Speaker 1: of playing that.

536
00:24:31,160 --> 00:24:31,520
Speaker 3: He could do.

537
00:24:31,680 --> 00:24:33,879
Speaker 10: But Jordan did amazing things. He's the greatest of all.

538
00:24:33,760 --> 00:24:36,000
Speaker 1: Time, of all time, and then he got that in

539
00:24:36,359 --> 00:24:38,960
Speaker 1: the pros. But anyway, so I'm a you know, it'll

540
00:24:38,960 --> 00:24:41,920
Speaker 1: be interesting because what's the feeling about your coach Hubert?

541
00:24:42,560 --> 00:24:42,720
Speaker 4: Oh?

542
00:24:42,760 --> 00:24:45,120
Speaker 10: I love Hubert now part of the family.

543
00:24:45,000 --> 00:24:47,960
Speaker 1: Now, but does that still hold within the alumni base?

544
00:24:48,040 --> 00:24:49,800
Speaker 1: And this is he still really well supported?

545
00:24:49,880 --> 00:24:52,040
Speaker 10: I think so he's on thinner ice than he was

546
00:24:52,160 --> 00:24:54,560
Speaker 10: you know, of course last year. And he's done a

547
00:24:54,560 --> 00:24:57,159
Speaker 10: really good job recruiting. But it's putting different pieces together

548
00:24:57,440 --> 00:24:59,560
Speaker 10: on a team that's not used to playing like the

549
00:24:59,560 --> 00:25:02,560
Speaker 10: three ball. Basically. Yeah, we're very big into getting into

550
00:25:02,600 --> 00:25:05,800
Speaker 10: the middle and you know, grinding in right below the basket.

551
00:25:05,880 --> 00:25:06,119
Speaker 5: All right.

552
00:25:06,160 --> 00:25:09,120
Speaker 1: Then chop Hill also has a good football team this year.

553
00:25:09,280 --> 00:25:09,760
Speaker 11: We do.

554
00:25:09,840 --> 00:25:12,240
Speaker 10: I would love to talk about football here. Yes, apparently

555
00:25:12,359 --> 00:25:15,000
Speaker 10: Duke is good, very good now a lot.

556
00:25:15,119 --> 00:25:18,640
Speaker 1: It doesn't happen almost any time. You know, they beat

557
00:25:18,680 --> 00:25:21,240
Speaker 1: Clemson this year at Duke. The last time they beat

558
00:25:21,280 --> 00:25:23,320
Speaker 1: Clemson was when I was a first year business school

559
00:25:23,359 --> 00:25:26,320
Speaker 1: student in nineteen eighty nine, beat Clemson. I was at

560
00:25:26,359 --> 00:25:26,720
Speaker 1: that game.

561
00:25:26,760 --> 00:25:27,640
Speaker 3: It was pouring rain.

562
00:25:28,000 --> 00:25:29,840
Speaker 1: I was the only one for my study section because

563
00:25:29,840 --> 00:25:32,040
Speaker 1: we had a big exam on that Monday. Everybody else

564
00:25:32,119 --> 00:25:33,959
Speaker 1: was doing a smart thing and studying for the exam.

565
00:25:34,320 --> 00:25:36,879
Speaker 1: I was out in the pouring rain watching Duke beat Clemson.

566
00:25:36,960 --> 00:25:37,960
Speaker 1: John So that's kind of how.

567
00:25:37,840 --> 00:25:38,400
Speaker 3: I put you through.

568
00:25:40,160 --> 00:25:41,600
Speaker 1: It was a long road to dig out of that

569
00:25:41,640 --> 00:25:43,879
Speaker 1: hole I started myself in, but you know it was

570
00:25:43,920 --> 00:25:44,400
Speaker 1: worth it.

571
00:25:44,840 --> 00:25:46,400
Speaker 3: Yeah, exactly, I passed. It's all good.

572
00:25:46,480 --> 00:25:48,600
Speaker 1: The historic moment it is, so it's all good. Kelly Cox,

573
00:25:48,600 --> 00:25:50,639
Speaker 1: thanks so much for joining us. Kelli Cox, us investment

574
00:25:50,680 --> 00:25:53,520
Speaker 1: analyst for e Toro and a proud graduate of the

575
00:25:53,640 --> 00:25:55,119
Speaker 1: University of North Carolina.

576
00:25:56,960 --> 00:26:01,320
Speaker 8: You're listening to the Team Canser Live Programloomberg Markets weekdays

577
00:26:01,359 --> 00:26:05,080
Speaker 8: at ten am Eastering on Bloomberg dot com, the iHeartRadio app,

578
00:26:05,119 --> 00:26:08,040
Speaker 8: and the Bloomberg Business App, or listen on demand wherever

579
00:26:08,080 --> 00:26:10,639
Speaker 8: you get your podcast.

580
00:26:10,680 --> 00:26:15,399
Speaker 1: Bank Great dot Com. Thirty year US fixed rate mortgage

581
00:26:15,640 --> 00:26:18,600
Speaker 1: seven point seven eight percent. I'm not going to complain

582
00:26:18,600 --> 00:26:20,840
Speaker 1: about my six percent mortgage anymore. And you've got the

583
00:26:21,040 --> 00:26:21,840
Speaker 1: three something.

584
00:26:21,680 --> 00:26:22,560
Speaker 7: Yeah, well three and a quarter.

585
00:26:22,680 --> 00:26:23,280
Speaker 3: Yeah, there you go.

586
00:26:23,359 --> 00:26:26,120
Speaker 1: So I mean, how can I know if you look

587
00:26:26,119 --> 00:26:27,960
Speaker 1: back like a gajillion years, that's pretty much in line

588
00:26:27,960 --> 00:26:30,040
Speaker 1: with the average. But still that that hurts. But let's

589
00:26:30,040 --> 00:26:32,240
Speaker 1: talk to somebody who does this stuff every day. Odetta Kushi,

590
00:26:32,880 --> 00:26:37,359
Speaker 1: Deputy Chief Economists at First American. Adetta, what's your thirty

591
00:26:37,359 --> 00:26:40,920
Speaker 1: thousand foot view of this residential real estate market? I mean,

592
00:26:40,920 --> 00:26:43,040
Speaker 1: nobody wants to get out of their house. Nobody wants

593
00:26:43,080 --> 00:26:44,920
Speaker 1: to sell. If I want to buy, I got to

594
00:26:44,960 --> 00:26:47,480
Speaker 1: pay this huge mortgage. It's kind of tough out there,

595
00:26:47,520 --> 00:26:49,119
Speaker 1: isn't it.

596
00:26:49,119 --> 00:26:51,520
Speaker 12: It is very tough out there, a lot of headwinds

597
00:26:51,520 --> 00:26:53,960
Speaker 12: in the housing market, but it's resulted in some really

598
00:26:53,960 --> 00:26:57,240
Speaker 12: interesting dynamics. The first of which is that we're seeing

599
00:26:57,240 --> 00:27:00,640
Speaker 12: a reacceleration in house price growth. You know, you've got

600
00:27:00,680 --> 00:27:05,040
Speaker 12: demands still surpassing supply and that's putting that's econ one

601
00:27:05,040 --> 00:27:07,359
Speaker 12: to one right for house price growth, and so we

602
00:27:07,400 --> 00:27:11,600
Speaker 12: saw the SMP case Shiller reaccelerate. We've seen it up

603
00:27:11,640 --> 00:27:14,000
Speaker 12: on a year over year basis after declining for three

604
00:27:14,000 --> 00:27:17,240
Speaker 12: months in a row. And that's pretty broad based across

605
00:27:17,320 --> 00:27:20,520
Speaker 12: most markets, of course, with some regional differences. And the

606
00:27:20,560 --> 00:27:23,960
Speaker 12: other dynamic here is because there are so few existing

607
00:27:24,000 --> 00:27:26,480
Speaker 12: homes on the market because of that rate lock and

608
00:27:26,520 --> 00:27:29,520
Speaker 12: effect that you alluded to. You know, people are going

609
00:27:29,560 --> 00:27:33,159
Speaker 12: to the new home market because builders are offering incentives,

610
00:27:33,520 --> 00:27:37,680
Speaker 12: they're buying down rates, and so the new home market

611
00:27:37,720 --> 00:27:40,720
Speaker 12: has actually fared better than the existing home market this year.

612
00:27:41,720 --> 00:27:43,959
Speaker 2: So what does that mean for affordability? I mean, prices

613
00:27:43,960 --> 00:27:47,320
Speaker 2: are up, you know, rates are up. Is this a

614
00:27:47,400 --> 00:27:51,360
Speaker 2: market that is just you know, deadly for first time buyers.

615
00:27:52,480 --> 00:27:54,639
Speaker 12: It's really tough out there for first time buyers. As

616
00:27:54,720 --> 00:27:58,080
Speaker 12: you mentioned, you know, affordability is a function of home prices,

617
00:27:58,280 --> 00:28:02,119
Speaker 12: interest rates, and incomes, and home prices are up again,

618
00:28:02,800 --> 00:28:07,240
Speaker 12: interest rates are moving higher, incomes are increasing, but it's

619
00:28:07,280 --> 00:28:10,040
Speaker 12: not enough to offset the impact of higher rates and prices.

620
00:28:10,080 --> 00:28:12,359
Speaker 12: So it's tough out there as a first time home buyer.

621
00:28:12,560 --> 00:28:15,320
Speaker 12: But we are seeing them look to the new home

622
00:28:15,359 --> 00:28:19,440
Speaker 12: market because again with rates at seven percent, builders are

623
00:28:19,560 --> 00:28:22,840
Speaker 12: buying down rates to six percent, sometimes even five percent,

624
00:28:23,400 --> 00:28:26,720
Speaker 12: and oftentimes also cutting prices on homes, and so the

625
00:28:26,760 --> 00:28:31,480
Speaker 12: new home market is actually more affordable than the existing

626
00:28:31,480 --> 00:28:34,080
Speaker 12: home market, which is not traditionally the case.

627
00:28:34,600 --> 00:28:36,840
Speaker 2: How are builders able to do that? I've been hearing

628
00:28:36,880 --> 00:28:40,680
Speaker 2: this too, and I find it fascinating. And how long

629
00:28:40,880 --> 00:28:43,040
Speaker 2: will they be able to hold to keep that up?

630
00:28:44,240 --> 00:28:45,040
Speaker 10: I think it'll be tough.

631
00:28:45,040 --> 00:28:46,920
Speaker 12: I mean, we saw the new home sales number come

632
00:28:46,960 --> 00:28:51,040
Speaker 12: down in August, rates at seven percent, over seven percent,

633
00:28:51,120 --> 00:28:55,120
Speaker 12: really biting into affordability and cutting down demand. And builders

634
00:28:55,160 --> 00:28:58,200
Speaker 12: have had the margins to be able to buy down

635
00:28:58,200 --> 00:29:00,760
Speaker 12: the rates. But the higher that moreage rates go, the

636
00:29:00,800 --> 00:29:01,560
Speaker 12: more difficult that.

637
00:29:01,400 --> 00:29:01,880
Speaker 9: That will be.

638
00:29:03,040 --> 00:29:05,360
Speaker 1: Oh, I'll just you know again on that bank rate

639
00:29:05,520 --> 00:29:09,120
Speaker 1: thirty or mortgage seven point seven percent. That's the highest

640
00:29:09,160 --> 00:29:14,880
Speaker 1: sense two thousand, just extraordinary. So I guess the question is,

641
00:29:14,880 --> 00:29:16,720
Speaker 1: is there a rate out there that you think is

642
00:29:16,760 --> 00:29:19,840
Speaker 1: a clearing rate for lack of a better word, where

643
00:29:19,840 --> 00:29:22,120
Speaker 1: it might kind of loosen things up in buyers will

644
00:29:22,720 --> 00:29:24,880
Speaker 1: be willing to take that mortgage sellers, we'll bring.

645
00:29:24,720 --> 00:29:26,960
Speaker 2: About the great reset a lot, as a lot of

646
00:29:26,960 --> 00:29:29,360
Speaker 2: people have called it the expected event.

647
00:29:30,840 --> 00:29:34,360
Speaker 12: Well, you know, more than ninety percent of existing homeowners

648
00:29:34,400 --> 00:29:37,680
Speaker 12: are locked into rates below six percent, So I think,

649
00:29:37,720 --> 00:29:40,800
Speaker 12: certainly if we could start approaching six percent, we'll start

650
00:29:40,800 --> 00:29:42,880
Speaker 12: to see a lot of activity. There's a lot of

651
00:29:42,880 --> 00:29:47,880
Speaker 12: buyers on the sidelines. There's a whole generation of millennials

652
00:29:48,360 --> 00:29:50,840
Speaker 12: that that are out there looking for that first home

653
00:29:51,240 --> 00:29:54,120
Speaker 12: and you know, on the sidelines waiting for that mortgage

654
00:29:54,160 --> 00:29:56,160
Speaker 12: math to work for them. So I think if we

655
00:29:56,160 --> 00:29:59,040
Speaker 12: can start to get rates heading lower, you know, approaching

656
00:29:59,040 --> 00:30:02,160
Speaker 12: that six percent, certainly that that would bring some folks

657
00:30:02,160 --> 00:30:02,920
Speaker 12: off the sidelines.

658
00:30:03,400 --> 00:30:06,320
Speaker 2: What about adjustable rate mortgage is how popular had they become?

659
00:30:07,880 --> 00:30:11,400
Speaker 12: We start to see adjustable rate mortgages, you know, the

660
00:30:11,520 --> 00:30:15,080
Speaker 12: use of those increase as rates increase, So we've seen

661
00:30:15,080 --> 00:30:17,719
Speaker 12: them come up a little bit over the last year

662
00:30:17,760 --> 00:30:20,360
Speaker 12: as mortgage rates have increased, but there's still a smaller

663
00:30:20,360 --> 00:30:21,160
Speaker 12: share of the market.

664
00:30:21,640 --> 00:30:23,360
Speaker 3: If I want to go get a mortgage, can I

665
00:30:23,440 --> 00:30:26,600
Speaker 3: even get one here? And how is the mortgage origination market?

666
00:30:28,240 --> 00:30:32,360
Speaker 12: Mortgage standards have been tight, right, so not even just

667
00:30:32,400 --> 00:30:35,760
Speaker 12: this year, but generally speaking, and certainly compared to you know,

668
00:30:35,760 --> 00:30:38,280
Speaker 12: the early in mid two thousands, lending standards have been

669
00:30:38,320 --> 00:30:42,560
Speaker 12: significantly tighter, and so it's probably tough route there to

670
00:30:42,560 --> 00:30:45,880
Speaker 12: get a mortgage, certainly tougher to get a jumbo mortgage

671
00:30:45,880 --> 00:30:49,080
Speaker 12: if that's what you're in the market for. And so

672
00:30:49,280 --> 00:30:53,080
Speaker 12: that's that's sort of another headwind to the housing market.

673
00:30:53,120 --> 00:30:56,320
Speaker 1: What's the regional factor here? I mean, it just seems

674
00:30:56,400 --> 00:30:58,400
Speaker 1: like we just heard so many stories during the pandemic

675
00:30:58,440 --> 00:31:01,280
Speaker 1: of everybody you know, owing to the Sun Belt going

676
00:31:01,320 --> 00:31:05,280
Speaker 1: to Texas, Florida, Tennessee for crying out loud. I mean,

677
00:31:05,360 --> 00:31:08,160
Speaker 1: is it I don't even know where there's where they're

678
00:31:08,160 --> 00:31:10,959
Speaker 1: putting those people. But are those markets appreciably stronger? Are

679
00:31:10,960 --> 00:31:13,240
Speaker 1: we seeing more activity there than maybe other parts of

680
00:31:13,240 --> 00:31:13,720
Speaker 1: the country.

681
00:31:14,440 --> 00:31:14,880
Speaker 7: That's right.

682
00:31:14,960 --> 00:31:18,400
Speaker 12: In the latest SMPK shild report, the markets that experienced

683
00:31:18,400 --> 00:31:20,479
Speaker 12: the strongest growth were in the rest belt, and then

684
00:31:20,520 --> 00:31:23,040
Speaker 12: you also had New York. So it was really the

685
00:31:23,080 --> 00:31:26,800
Speaker 12: Midwest the Northeast that are outperforming, and then the West

686
00:31:26,840 --> 00:31:32,080
Speaker 12: Coast traditionally more expensive markets that really have experienced the

687
00:31:32,120 --> 00:31:36,160
Speaker 12: strongest price declines. So you know, you've got your San Jose,

688
00:31:36,360 --> 00:31:39,880
Speaker 12: San Francisco, you know, have had a tougher go in

689
00:31:40,200 --> 00:31:41,480
Speaker 12: a rising mortgage rate environment.

690
00:31:41,560 --> 00:31:44,680
Speaker 2: So I imagine you know, workers there are still in

691
00:31:45,360 --> 00:31:46,320
Speaker 2: strong demand.

692
00:31:46,920 --> 00:31:48,000
Speaker 7: Construction workers.

693
00:31:48,280 --> 00:31:52,320
Speaker 2: Are builders able to get everything they need, land, permits, labor.

694
00:31:53,560 --> 00:31:54,280
Speaker 10: It's still tough.

695
00:31:54,320 --> 00:31:57,800
Speaker 12: The supply chain headwinds, the supply side headwinds for builders.

696
00:31:58,400 --> 00:32:00,880
Speaker 12: You know, some have eased, some of the material supply

697
00:32:00,960 --> 00:32:04,320
Speaker 12: side challenges have eased, but there is still a chronic

698
00:32:04,360 --> 00:32:08,840
Speaker 12: shortage of a skilled construction workers. And so you know,

699
00:32:08,880 --> 00:32:12,000
Speaker 12: the construction industry is still contending with some of these headwinds.

700
00:32:12,520 --> 00:32:14,680
Speaker 1: So do you guys at your shop, do you have

701
00:32:14,720 --> 00:32:17,680
Speaker 1: a view on mortgage rates kind of where you think

702
00:32:17,720 --> 00:32:19,280
Speaker 1: they're going to be six months from now, twelve months

703
00:32:19,320 --> 00:32:19,680
Speaker 1: from now.

704
00:32:20,800 --> 00:32:25,040
Speaker 12: Mortgage rates are notoriously difficult to forecast because they're tied

705
00:32:25,080 --> 00:32:27,960
Speaker 12: to you know, the ten year treasury, which can be

706
00:32:28,040 --> 00:32:33,160
Speaker 12: influenced by everything from you know, geopolitical tensions to your recession,

707
00:32:33,280 --> 00:32:36,440
Speaker 12: to of course inflation. But I will say that the

708
00:32:36,480 --> 00:32:39,200
Speaker 12: Fed has maintained its hawkish stance. They've made it very

709
00:32:39,200 --> 00:32:42,640
Speaker 12: clear that they intend to stay keep rates higher for longer,

710
00:32:42,920 --> 00:32:46,240
Speaker 12: and that means continued upward pressure on mortgage rates. I'm

711
00:32:46,240 --> 00:32:49,560
Speaker 12: certainly not seeing mortgage rates, you know, getting back to

712
00:32:49,680 --> 00:32:50,880
Speaker 12: I think one of you said you have a three

713
00:32:50,880 --> 00:32:53,440
Speaker 12: percent mortgage, and I'm not seeing that happen anytime soon.

714
00:32:53,560 --> 00:32:55,040
Speaker 7: Thank goodness, that was me.

715
00:32:56,160 --> 00:33:01,360
Speaker 2: So if you have I guess slower household formation because

716
00:33:01,960 --> 00:33:06,480
Speaker 2: affordability is off the charts, does that also mean consumers

717
00:33:06,520 --> 00:33:11,560
Speaker 2: are spending less money, you know at I don't know

718
00:33:11,560 --> 00:33:16,240
Speaker 2: where people go these days, you know, restoration, hardware, create

719
00:33:16,320 --> 00:33:20,280
Speaker 2: and barrel, you know, furnishing places, putting things together.

720
00:33:21,440 --> 00:33:24,480
Speaker 12: I mean there is a multiplier effect on the economy,

721
00:33:24,520 --> 00:33:28,440
Speaker 12: certainly from from from demand sort of subsiding for housing,

722
00:33:29,240 --> 00:33:33,120
Speaker 12: you know, and of course if construction slows further, that

723
00:33:33,200 --> 00:33:36,080
Speaker 12: will have a multiplier effect on you know, durable goods,

724
00:33:36,760 --> 00:33:42,120
Speaker 12: housing services. So certainly reduced demand for housing due to

725
00:33:42,120 --> 00:33:46,840
Speaker 12: the affordability environment can impact demand for furnishings and all

726
00:33:46,880 --> 00:33:47,280
Speaker 12: of those.

727
00:33:48,200 --> 00:33:48,880
Speaker 7: All right, Odedda.

728
00:33:48,880 --> 00:33:51,440
Speaker 1: Thanks so much for joining us at Debtakushy, Deputy Chief

729
00:33:51,480 --> 00:33:53,520
Speaker 1: Economists for First American.

730
00:33:54,840 --> 00:33:58,000
Speaker 8: You're listening to the tape cans are live program Bloomberg

731
00:33:58,040 --> 00:34:01,640
Speaker 8: Markets weekdays at ten am Eastern on Bloomberg Radio, the

732
00:34:01,680 --> 00:34:04,920
Speaker 8: tune in app, Bloomberg dot Com, and the Bloomberg Business App.

733
00:34:04,960 --> 00:34:07,800
Speaker 8: You can also listen live on Amazon Alexa from our

734
00:34:07,800 --> 00:34:12,160
Speaker 8: flagship New York station. Just say Alexa play Bloomberg eleven.

735
00:34:11,880 --> 00:34:19,760
Speaker 1: Thirty glco go the global commodity prices. That's the function

736
00:34:19,840 --> 00:34:21,879
Speaker 1: for that. I look at the medals here you're to date.

737
00:34:22,200 --> 00:34:25,040
Speaker 1: Pretty much everything is down on a year to date basis.

738
00:34:25,040 --> 00:34:29,239
Speaker 1: A couple exceptions, most notable being gold that's up three percent.

739
00:34:29,320 --> 00:34:32,360
Speaker 1: Let's see what's happening in the world of metals right now.

740
00:34:32,640 --> 00:34:35,000
Speaker 1: We talk commodities, we talk crypto. We talked to Everett Millen.

741
00:34:35,160 --> 00:34:40,280
Speaker 1: He's a chief markets analyst at Gainesville Coins. So, Everett,

742
00:34:40,280 --> 00:34:42,800
Speaker 1: what is happening with gold here? What's the cause? Seems

743
00:34:42,840 --> 00:34:44,799
Speaker 1: to be bucking the trend where I've got aluminum down,

744
00:34:44,920 --> 00:34:48,359
Speaker 1: copper down, gold down on a silver down on your

745
00:34:48,400 --> 00:34:50,000
Speaker 1: today basis, but I've got gold higher.

746
00:34:51,440 --> 00:34:54,520
Speaker 6: Yeah, thanks for having me on I think it's really

747
00:34:54,560 --> 00:34:58,920
Speaker 6: interesting that gold has been fairly resilient, hanging out around

748
00:34:58,920 --> 00:35:02,880
Speaker 6: that nineteen hundred mar even with so many headwinds working

749
00:35:02,920 --> 00:35:05,960
Speaker 6: against it. You have the dollar climbing to its highest

750
00:35:05,960 --> 00:35:09,840
Speaker 6: and six months rates being higher. Real rates being higher

751
00:35:09,920 --> 00:35:13,439
Speaker 6: is usually negative for gold. And we've also just come

752
00:35:13,480 --> 00:35:16,879
Speaker 6: out of the summer months, which are typically they see

753
00:35:16,920 --> 00:35:19,920
Speaker 6: poor seasonality for the gold market. And in spite of

754
00:35:19,960 --> 00:35:23,160
Speaker 6: all that, you're right, gold has held up relatively well.

755
00:35:23,200 --> 00:35:24,719
Speaker 6: And I think a lot of it has to do

756
00:35:25,239 --> 00:35:28,120
Speaker 6: with the fact that central banks continue to purchase gold

757
00:35:28,160 --> 00:35:31,680
Speaker 6: and kind of place a floor beneath the price. And

758
00:35:31,719 --> 00:35:34,920
Speaker 6: in many cases, sure this is done to stave off

759
00:35:35,120 --> 00:35:38,239
Speaker 6: currency appreciation, but it's also a sign that central banks

760
00:35:38,280 --> 00:35:42,160
Speaker 6: are probably hedging against the potential for a policy error

761
00:35:42,440 --> 00:35:44,760
Speaker 6: or an economic downturn in the near future.

762
00:35:45,480 --> 00:35:49,480
Speaker 2: So which central banks had the most gold and who's

763
00:35:49,520 --> 00:35:50,160
Speaker 2: doing the buying.

764
00:35:51,600 --> 00:35:55,319
Speaker 6: So as of now, the Federal Reserve still holds the

765
00:35:55,320 --> 00:35:57,880
Speaker 6: most gold in the world, but the big buyers we

766
00:35:57,920 --> 00:36:01,200
Speaker 6: see are mostly in the East, especially as we've seen

767
00:36:01,239 --> 00:36:05,960
Speaker 6: outflows from gold ETFs in North America and Europe. Typically

768
00:36:06,000 --> 00:36:09,280
Speaker 6: most of that gold ends up flowing into China and India,

769
00:36:09,320 --> 00:36:12,560
Speaker 6: and so the People's Bank of China is certainly continuing

770
00:36:12,640 --> 00:36:16,040
Speaker 6: to buy gold. And what's interesting is there's been this

771
00:36:16,120 --> 00:36:20,920
Speaker 6: persistent premium on gold in Shanghai relative to London. Now

772
00:36:20,960 --> 00:36:24,879
Speaker 6: there is some speculation that that's perhaps due to policies

773
00:36:24,920 --> 00:36:28,040
Speaker 6: followed by the PBOC, but really what it says to

774
00:36:28,040 --> 00:36:30,640
Speaker 6: me is it's just a sign of robust demand for

775
00:36:30,719 --> 00:36:33,920
Speaker 6: gold in China, and that's important because China is always

776
00:36:33,960 --> 00:36:37,120
Speaker 6: the number one consumer of gold in the world.

777
00:36:37,280 --> 00:36:40,160
Speaker 7: By the way, how do you play that arbitrage?

778
00:36:40,360 --> 00:36:42,719
Speaker 2: I mean, it's not like you're going to load up

779
00:36:43,000 --> 00:36:46,319
Speaker 2: a plane full of gold bars in Shanghai and fly

780
00:36:46,440 --> 00:36:49,000
Speaker 2: them into Heathrow, right, is there any way to play

781
00:36:49,000 --> 00:36:49,560
Speaker 2: the difference?

782
00:36:50,880 --> 00:36:52,080
Speaker 11: Well, that's a great question.

783
00:36:52,480 --> 00:36:55,239
Speaker 6: There's there's been some suggestions that perhaps that could be

784
00:36:55,280 --> 00:36:58,879
Speaker 6: done through Hong Kong, given that it is still under

785
00:36:59,000 --> 00:37:03,520
Speaker 6: Chinese rule but is somewhat of a separate special financial zone.

786
00:37:03,840 --> 00:37:06,960
Speaker 11: I don't think that there's any practical way to play

787
00:37:06,960 --> 00:37:07,879
Speaker 11: that arbitrage.

788
00:37:08,000 --> 00:37:12,200
Speaker 6: But again, outside of the East, sentiment in the pressures

789
00:37:12,200 --> 00:37:14,880
Speaker 6: and precious metals market it's still rather pessimistic.

790
00:37:15,200 --> 00:37:17,200
Speaker 11: So even if there was a way to play that.

791
00:37:17,280 --> 00:37:20,080
Speaker 6: I don't think a lot of investors are really tuned

792
00:37:20,080 --> 00:37:21,480
Speaker 6: into that or paying attention.

793
00:37:21,160 --> 00:37:24,200
Speaker 7: To that evert how closely do you watch the dollar?

794
00:37:24,600 --> 00:37:28,320
Speaker 2: I always have the Bloomberg Dollar Index on my screen.

795
00:37:28,320 --> 00:37:31,480
Speaker 2: A lot of people watch just DXY. But right now

796
00:37:31,480 --> 00:37:34,520
Speaker 2: we're trading at twelve seventy. It's the highest level we've

797
00:37:34,560 --> 00:37:39,600
Speaker 2: seen in about a year, showing some real strength against

798
00:37:39,880 --> 00:37:44,600
Speaker 2: our trading partners, but also obviously strength in gold term

799
00:37:44,760 --> 00:37:46,480
Speaker 2: strength and oil terms, et cetera.

800
00:37:47,960 --> 00:37:50,120
Speaker 11: Right, it's always important to watch the dollar.

801
00:37:50,840 --> 00:37:53,399
Speaker 6: The fact that it has strengthened so much against its

802
00:37:53,400 --> 00:37:56,800
Speaker 6: pure currencies around the world shows up in the gold price.

803
00:37:56,960 --> 00:38:00,759
Speaker 6: Especially this week we've seen gold drifting lower, but when

804
00:38:00,800 --> 00:38:04,480
Speaker 6: you look outside of the US, in most other currencies,

805
00:38:04,800 --> 00:38:07,880
Speaker 6: gold is at or near all time highs. So it

806
00:38:08,000 --> 00:38:11,120
Speaker 6: sort of is just a relative, a relative comparison that

807
00:38:11,239 --> 00:38:13,720
Speaker 6: the strength of the dollar in the West, it tends

808
00:38:13,760 --> 00:38:17,000
Speaker 6: to damp in interest in gold, but there's not.

809
00:38:17,000 --> 00:38:18,120
Speaker 11: Always a direct line.

810
00:38:18,160 --> 00:38:21,040
Speaker 6: So about a year ago we saw the last time

811
00:38:21,080 --> 00:38:24,000
Speaker 6: that the DXY was at these levels, we saw that

812
00:38:24,040 --> 00:38:27,880
Speaker 6: both the dollar and gold rallied in tandem. And sometimes

813
00:38:27,920 --> 00:38:30,160
Speaker 6: when there are safe haven concerns, you can see that

814
00:38:30,239 --> 00:38:32,160
Speaker 6: kind of paradoxical relationship happening.

815
00:38:32,280 --> 00:38:34,520
Speaker 2: And Paul and I were just talking about how boring

816
00:38:34,560 --> 00:38:37,320
Speaker 2: it's been to quote bitcoin lately. It's just holding it

817
00:38:37,440 --> 00:38:40,600
Speaker 2: twenty six thousand. But actually when you look at the

818
00:38:40,600 --> 00:38:43,279
Speaker 2: strength and the dollar, it's pretty interesting that bitcoin's been

819
00:38:43,320 --> 00:38:44,320
Speaker 2: able to hold this level.

820
00:38:45,560 --> 00:38:48,040
Speaker 6: That's right, it has been somewhat ranged down, and I

821
00:38:48,080 --> 00:38:50,399
Speaker 6: think clearly we're going to have to get some more

822
00:38:50,440 --> 00:38:54,240
Speaker 6: clarity on the regulatory end. We still have not gotten

823
00:38:54,560 --> 00:38:57,840
Speaker 6: a bitcoin ETF approval. And to kind of make a

824
00:38:57,880 --> 00:39:01,600
Speaker 6: comparison to gold, the gold market about a decade or

825
00:39:01,640 --> 00:39:05,640
Speaker 6: two ago experienced much greater liquidity and much greater demand

826
00:39:06,160 --> 00:39:09,080
Speaker 6: once a gold ETF was launched. So I believe a

827
00:39:09,120 --> 00:39:11,840
Speaker 6: lot of bitcoiners are looking at that experience and hoping

828
00:39:12,239 --> 00:39:15,360
Speaker 6: if there is a bitcoin ETF, it's going to ease

829
00:39:15,560 --> 00:39:20,439
Speaker 6: access for kind of lowering that barrier of entry for

830
00:39:20,440 --> 00:39:23,760
Speaker 6: people to get invested into bitcoin. And it's also important

831
00:39:23,760 --> 00:39:25,880
Speaker 6: to keep in mind that anyone who has been in

832
00:39:25,920 --> 00:39:30,000
Speaker 6: the crypto market for a few years, they've experienced these

833
00:39:30,080 --> 00:39:33,960
Speaker 6: kind of crypto winters before. So the current poor sentiment

834
00:39:34,040 --> 00:39:38,640
Speaker 6: regarding cryptos in bitcoin is not necessarily the death warrant

835
00:39:38,640 --> 00:39:40,400
Speaker 6: that I think some perceive it to be.

836
00:39:41,760 --> 00:39:45,160
Speaker 1: So what is the future of this ETF here? I mean,

837
00:39:45,200 --> 00:39:47,640
Speaker 1: it's kind of it feels like the crypto space Matt

838
00:39:47,640 --> 00:39:49,520
Speaker 1: and I were just talking about it. It's no longer

839
00:39:49,600 --> 00:39:51,879
Speaker 1: top of mind or what everybody wants to talk about

840
00:39:51,920 --> 00:39:54,239
Speaker 1: as much as it was, say, six, nine, twelve months ago,

841
00:39:54,480 --> 00:39:57,080
Speaker 1: And I'm wondering, is the space just waiting on how

842
00:39:57,120 --> 00:39:58,600
Speaker 1: this ETF issue will be resolved?

843
00:39:59,600 --> 00:40:00,040
Speaker 11: I think so.

844
00:40:00,360 --> 00:40:03,200
Speaker 6: And along the same lines, you know, you have this

845
00:40:03,280 --> 00:40:08,239
Speaker 6: tug of war between the greater trust and legitimacy that

846
00:40:08,280 --> 00:40:11,000
Speaker 6: would come with an ETF and greater regulation.

847
00:40:11,400 --> 00:40:13,520
Speaker 11: But on the other hand, pulling in the opposite direction

848
00:40:13,680 --> 00:40:13,920
Speaker 11: is the.

849
00:40:13,880 --> 00:40:16,880
Speaker 6: Fact that the crypto market has always been characterized by

850
00:40:16,920 --> 00:40:20,320
Speaker 6: this kind of free wheeling behavior where it thrives without

851
00:40:20,360 --> 00:40:23,520
Speaker 6: any oversight. And I think one of the important things that,

852
00:40:23,760 --> 00:40:26,120
Speaker 6: as you point out, that the market seems to be

853
00:40:26,160 --> 00:40:30,760
Speaker 6: waiting for, is there's an IRS proposal for new tax

854
00:40:30,800 --> 00:40:34,200
Speaker 6: reporting rules on digital assets, and so far that has

855
00:40:34,280 --> 00:40:36,440
Speaker 6: not been very well received by.

856
00:40:36,280 --> 00:40:37,280
Speaker 11: The crypto industry.

857
00:40:38,000 --> 00:40:40,400
Speaker 6: And we already know with the FTX to backle what

858
00:40:40,520 --> 00:40:44,680
Speaker 6: a complete lack of regulation and oversight looks like. But

859
00:40:44,719 --> 00:40:47,360
Speaker 6: we're going to have to get some kind of clarity

860
00:40:47,360 --> 00:40:50,120
Speaker 6: in that realm. Otherwise you will see all of the

861
00:40:50,160 --> 00:40:53,720
Speaker 6: activity in DeFi and Web three in the crypto space

862
00:40:54,000 --> 00:40:57,560
Speaker 6: will almost certainly move offshore and leave the US.

863
00:40:57,880 --> 00:41:01,120
Speaker 3: All right, So run more quick quick question forty seconds? Silver?

864
00:41:01,200 --> 00:41:01,919
Speaker 3: What's the call here?

865
00:41:03,360 --> 00:41:07,040
Speaker 6: Silver is one of those interesting disappointing things for the

866
00:41:07,040 --> 00:41:10,680
Speaker 6: precious metal foals. It has not really performed the way

867
00:41:10,680 --> 00:41:13,080
Speaker 6: that they expected. At the same time, we have to

868
00:41:13,160 --> 00:41:15,959
Speaker 6: keep in mind that year on year, silver's up about

869
00:41:15,960 --> 00:41:18,239
Speaker 6: twenty three percent, and I'm looking at a lot of

870
00:41:18,280 --> 00:41:22,080
Speaker 6: supply concerns. Mexico has seen at silver output drop by

871
00:41:22,080 --> 00:41:25,120
Speaker 6: nearly twenty percent. They're the world's largest producer, so supply

872
00:41:25,200 --> 00:41:29,040
Speaker 6: concerns I think give silver some fuel to move higher

873
00:41:29,320 --> 00:41:30,040
Speaker 6: in the short run.

874
00:41:30,320 --> 00:41:32,400
Speaker 3: All right, Everick, thank you so much. We appreciate that

875
00:41:32,560 --> 00:41:33,280
Speaker 3: as always.

876
00:41:33,600 --> 00:41:38,600
Speaker 1: Everett Milman joining US chief markets analysts at Gainesville Coins.

877
00:41:39,040 --> 00:41:40,360
Speaker 3: You're listening to the tape.

878
00:41:40,440 --> 00:41:43,799
Speaker 8: Catch our live program Bloomberg Markets weekdays at ten am

879
00:41:43,840 --> 00:41:47,640
Speaker 8: Eastern on Bloomberg Radio, the tune it app, Bloomberg dot Com,

880
00:41:47,680 --> 00:41:50,400
Speaker 8: and the Bloomberg Business app. You can also listen live

881
00:41:50,520 --> 00:41:53,680
Speaker 8: on Amazon Alexa from our flagship New York station, just

882
00:41:53,719 --> 00:41:57,040
Speaker 8: say Alexa play Bloomberg eleven thirty.

883
00:41:58,120 --> 00:42:00,439
Speaker 1: Well, we here in Bloomberg Radio and TV, the media

884
00:42:00,480 --> 00:42:01,120
Speaker 1: side of Bloomberg.

885
00:42:01,160 --> 00:42:02,200
Speaker 7: We're here every day.

886
00:42:02,239 --> 00:42:03,560
Speaker 3: We're required to be here every day.

887
00:42:03,600 --> 00:42:06,319
Speaker 1: And there are a lot of people in Bloomberg Radio

888
00:42:06,320 --> 00:42:09,000
Speaker 1: and TV that did not miss one day during the pandemic,

889
00:42:09,040 --> 00:42:11,520
Speaker 1: that came in every day to get the shows on

890
00:42:11,640 --> 00:42:15,200
Speaker 1: the air. But we are clearly the exception, not the rule.

891
00:42:15,719 --> 00:42:18,080
Speaker 1: It seems like this hybrid work is here to stay.

892
00:42:18,160 --> 00:42:21,400
Speaker 1: Let's see where the latest findings are. Eileen mulaney joins us.

893
00:42:21,400 --> 00:42:25,640
Speaker 1: She's a workforce transformation lead at Viato Partners. She joined

894
00:42:25,680 --> 00:42:29,600
Speaker 1: us via Zoom So Eileen is I guess hybrid work

895
00:42:29,760 --> 00:42:31,880
Speaker 1: is that the new normal going forward?

896
00:42:33,040 --> 00:42:35,080
Speaker 13: That is the new normal, and first, thank you so

897
00:42:35,160 --> 00:42:38,000
Speaker 13: much for having me. Yes, that is the new normal.

898
00:42:38,160 --> 00:42:40,959
Speaker 13: I think what we're seeing in a lot of industry sectors, though,

899
00:42:41,440 --> 00:42:45,640
Speaker 13: is this combination of really hybrid work. There really is

900
00:42:45,680 --> 00:42:48,040
Speaker 13: a big focus on return to the office. So we

901
00:42:48,200 --> 00:42:50,040
Speaker 13: definitely are seeing that. I think in the height of

902
00:42:50,080 --> 00:42:52,759
Speaker 13: the pandemic, we never thought we'd see returns office. We

903
00:42:52,760 --> 00:42:55,319
Speaker 13: thought we were folding remote forever, but there has been

904
00:42:55,360 --> 00:42:58,120
Speaker 13: a big push to get people back to the office,

905
00:42:58,120 --> 00:42:59,960
Speaker 13: and I think three two or four to one is

906
00:43:00,040 --> 00:43:01,640
Speaker 13: the most common schedules we're seeing.

907
00:43:02,160 --> 00:43:04,400
Speaker 1: I mean, there are a lot of folks. It seems

908
00:43:04,480 --> 00:43:07,640
Speaker 1: like a lot of industries, a lot of companies. I'm

909
00:43:07,640 --> 00:43:09,920
Speaker 1: thinking of the financial services industry. I'm thinking that Jamie

910
00:43:09,920 --> 00:43:14,240
Speaker 1: Diamonds of the world that are pushing still for five

911
00:43:14,400 --> 00:43:18,279
Speaker 1: days a week, but they again, they feel like the

912
00:43:18,719 --> 00:43:20,160
Speaker 1: exception rather than the rule here.

913
00:43:21,239 --> 00:43:23,080
Speaker 13: I think we're not seeing as much on the five

914
00:43:23,160 --> 00:43:24,879
Speaker 13: days a week though. I think there is a lot

915
00:43:24,920 --> 00:43:28,759
Speaker 13: to be said for human interaction collaboration, more than you

916
00:43:28,800 --> 00:43:31,279
Speaker 13: can do just on zoom. So I do see a

917
00:43:31,280 --> 00:43:35,160
Speaker 13: lot of focus on that, especially when it's very junior staff,

918
00:43:35,200 --> 00:43:38,840
Speaker 13: young staff that perhaps have not developed their professional network,

919
00:43:38,960 --> 00:43:41,279
Speaker 13: and that really is a plus to be in the

920
00:43:41,320 --> 00:43:45,120
Speaker 13: office and just see how things get done. Also, some

921
00:43:45,200 --> 00:43:48,560
Speaker 13: of the challenges with developing relationships with new clients new

922
00:43:48,600 --> 00:43:52,160
Speaker 13: customers can often be difficult if the relationship is purely

923
00:43:52,320 --> 00:43:55,439
Speaker 13: video based and not really in person. So I think

924
00:43:56,000 --> 00:43:58,080
Speaker 13: for me personally, the hybrid is kind of the best

925
00:43:58,080 --> 00:44:00,279
Speaker 13: in all worlds. But I do think that there are

926
00:44:00,280 --> 00:44:03,920
Speaker 13: some CEO some companies in particular that are really trying

927
00:44:04,280 --> 00:44:07,759
Speaker 13: for that five day week work in the office, But

928
00:44:07,880 --> 00:44:12,319
Speaker 13: we have seen employee expectations have significantly changed coming out

929
00:44:12,320 --> 00:44:12,720
Speaker 13: of COVID.

930
00:44:13,160 --> 00:44:15,200
Speaker 1: Yeah, I have two twenty seven year olds and a

931
00:44:15,239 --> 00:44:19,279
Speaker 1: twenty five year old in the workforce, my offspring, and

932
00:44:19,600 --> 00:44:21,880
Speaker 1: to them coming in five days a week, it's not

933
00:44:21,960 --> 00:44:25,880
Speaker 1: even something that's in their mindset. And I kind of

934
00:44:25,880 --> 00:44:29,760
Speaker 1: feel like this this generation, it's just a non starter.

935
00:44:29,960 --> 00:44:32,120
Speaker 1: Is that kind of how it seems at this point.

936
00:44:32,280 --> 00:44:34,960
Speaker 13: I think it certainly feels like that sometimes. I think

937
00:44:35,120 --> 00:44:37,640
Speaker 13: a lot of them started their career in COVID, so

938
00:44:37,680 --> 00:44:40,560
Speaker 13: it's all they know. But I think and some of

939
00:44:40,600 --> 00:44:43,440
Speaker 13: them do have an expectation when they do come into

940
00:44:43,480 --> 00:44:45,719
Speaker 13: the office kind of what's happening that day? Is there

941
00:44:45,760 --> 00:44:48,640
Speaker 13: something exciting? Is there you know, a happy hour? Is

942
00:44:48,640 --> 00:44:50,719
Speaker 13: there a lunch? You know, what's happening? Why should I?

943
00:44:50,880 --> 00:44:52,440
Speaker 13: Why do I need to be in the office? And

944
00:44:52,480 --> 00:44:55,520
Speaker 13: I think it's because they haven't seen the benefits of

945
00:44:55,560 --> 00:44:59,160
Speaker 13: that kind of collaboration full time. So I think that's

946
00:44:59,200 --> 00:45:01,680
Speaker 13: the importantsage to get to all of them for sure.

947
00:45:02,080 --> 00:45:05,520
Speaker 1: You know, when this whole thing started I was. I

948
00:45:05,560 --> 00:45:10,480
Speaker 1: just saw no way that this economy could function efficiently

949
00:45:10,640 --> 00:45:13,719
Speaker 1: with everybody working from home, like I thought, you know,

950
00:45:13,840 --> 00:45:16,560
Speaker 1: for example, just the business that I'm in Wall Street,

951
00:45:16,719 --> 00:45:21,759
Speaker 1: I couldn't imagine traders trading as efficiently and as successfully

952
00:45:21,960 --> 00:45:23,520
Speaker 1: from home as they do in the office, and they've

953
00:45:23,520 --> 00:45:26,800
Speaker 1: got all this computer screens and all the technical tools.

954
00:45:27,400 --> 00:45:29,840
Speaker 1: But they did, and the economy did, and the global

955
00:45:29,880 --> 00:45:33,400
Speaker 1: economy did just well. I mean, it's just really shocking

956
00:45:33,600 --> 00:45:34,400
Speaker 1: how it really played out.

957
00:45:34,560 --> 00:45:37,160
Speaker 13: I was one of those that thought, oh, this will

958
00:45:37,160 --> 00:45:38,839
Speaker 13: be in place for about two weeks and we'll get

959
00:45:38,840 --> 00:45:41,200
Speaker 13: back to normal. I kind of shared the same opinion

960
00:45:41,239 --> 00:45:43,640
Speaker 13: that it's going to be hard to really shift to

961
00:45:43,719 --> 00:45:48,480
Speaker 13: being productive efficient and just continue on as if this

962
00:45:48,640 --> 00:45:51,240
Speaker 13: was a normal and none of us were really prepared

963
00:45:51,320 --> 00:45:54,040
Speaker 13: for it, and none of us were really trained properly

964
00:45:54,120 --> 00:45:57,239
Speaker 13: for it. It's different with the organizations now. They're doing

965
00:45:57,280 --> 00:46:01,320
Speaker 13: a lot of focus training on helping manage understand how

966
00:46:01,360 --> 00:46:04,640
Speaker 13: to really manage a workforce that's not in the office,

967
00:46:04,880 --> 00:46:07,120
Speaker 13: how to kind of look at social cues on video,

968
00:46:07,239 --> 00:46:10,000
Speaker 13: all different kinds of training that we had never thought

969
00:46:10,280 --> 00:46:13,759
Speaker 13: of putting our teams through before COVID. So certainly a

970
00:46:13,760 --> 00:46:16,640
Speaker 13: lot more age and tools to help people, But I

971
00:46:16,680 --> 00:46:19,040
Speaker 13: agree with you, I don't think we all expected it

972
00:46:19,040 --> 00:46:23,400
Speaker 13: would be quite so successful without any planning or training.

973
00:46:23,000 --> 00:46:25,799
Speaker 1: For sure, I think one of the unintended consequences. But

974
00:46:25,840 --> 00:46:28,160
Speaker 1: something that people are starting to think about now is

975
00:46:28,160 --> 00:46:31,560
Speaker 1: is this kind of creating a divide or exacerbating a

976
00:46:31,600 --> 00:46:34,840
Speaker 1: divide between those people will call them essential workers that

977
00:46:34,960 --> 00:46:37,440
Speaker 1: have to be in whether it's on a factory floor

978
00:46:37,560 --> 00:46:40,440
Speaker 1: or at a fast food restaurant, and those that don't

979
00:46:40,480 --> 00:46:43,440
Speaker 1: and those that actually have the flexibility. How big of

980
00:46:43,480 --> 00:46:46,360
Speaker 1: a problem is that now and could it evolve into

981
00:46:47,239 --> 00:46:48,399
Speaker 1: it continues to be a problem.

982
00:46:48,520 --> 00:46:51,000
Speaker 13: We certainly saw it as a lot of organizations started

983
00:46:51,040 --> 00:46:53,680
Speaker 13: to design their future of work programs, And this was

984
00:46:53,760 --> 00:46:56,120
Speaker 13: during the height of COVID, when, as you said, those

985
00:46:56,200 --> 00:46:59,160
Speaker 13: essential workers had to be at work by day's a

986
00:46:59,160 --> 00:47:02,120
Speaker 13: week and everybody else was at home. And it's I

987
00:47:02,120 --> 00:47:04,960
Speaker 13: think companies still really struggle with what kind of peer

988
00:47:05,000 --> 00:47:07,360
Speaker 13: equity do we want to develop, what kind of culture

989
00:47:07,480 --> 00:47:10,000
Speaker 13: do we want to develop for the organization? When there's

990
00:47:10,040 --> 00:47:12,880
Speaker 13: definitely in a lot of industry sectors, a lot of companies,

991
00:47:13,200 --> 00:47:17,520
Speaker 13: very distinct workforces. A part of the same organization, and

992
00:47:17,520 --> 00:47:19,960
Speaker 13: it's very challenging to come up with policies that are

993
00:47:20,040 --> 00:47:24,080
Speaker 13: viewed as equitable across the board for everyone when certain

994
00:47:24,239 --> 00:47:27,239
Speaker 13: roles and even certain locations just have a bit more

995
00:47:27,320 --> 00:47:31,040
Speaker 13: flexibility than others. So I think that tension is here

996
00:47:31,080 --> 00:47:31,600
Speaker 13: to stay for.

997
00:47:31,600 --> 00:47:33,719
Speaker 1: Sure, and I wonder if that's kind of driving to

998
00:47:33,760 --> 00:47:36,760
Speaker 1: some extent, some of the strikes that we've seen worker strikes,

999
00:47:36,760 --> 00:47:39,799
Speaker 1: whether it's a UAW or the actors and writers in

1000
00:47:39,840 --> 00:47:43,880
Speaker 1: Hollywood or the ups drivers. I'm guessing a lot of

1001
00:47:43,920 --> 00:47:46,319
Speaker 1: those folks are saying I need to get some now.

1002
00:47:46,360 --> 00:47:48,640
Speaker 1: I mean, I was an a central worker. I made

1003
00:47:48,640 --> 00:47:51,080
Speaker 1: the big commitment, I took the risk. Now I want something.

1004
00:47:52,040 --> 00:47:52,200
Speaker 9: You know.

1005
00:47:52,239 --> 00:47:53,840
Speaker 13: It's hard for me to comment on those I'm not

1006
00:47:53,920 --> 00:47:56,000
Speaker 13: part of any of those unions, but I can say

1007
00:47:56,000 --> 00:47:59,200
Speaker 13: for the organizations that I work with across the board,

1008
00:47:59,480 --> 00:48:03,239
Speaker 13: flexible ability is a critical design feature more than it

1009
00:48:03,280 --> 00:48:06,800
Speaker 13: ever was before. And it's interesting when companies think about

1010
00:48:06,800 --> 00:48:10,480
Speaker 13: flexibility for their workforce, they think about it in two parts.

1011
00:48:10,560 --> 00:48:15,200
Speaker 13: One employee flexibility, where the employees can work flexibly, and

1012
00:48:15,239 --> 00:48:17,759
Speaker 13: that doesn't always mean I get to work at home,

1013
00:48:17,800 --> 00:48:20,919
Speaker 13: but it could be more creativity around the shifts they

1014
00:48:20,920 --> 00:48:23,040
Speaker 13: have to work or how much time off there is.

1015
00:48:23,360 --> 00:48:26,279
Speaker 13: So I think that whole kind of creative approach, it's

1016
00:48:26,320 --> 00:48:28,600
Speaker 13: not kind of business as usable when we're thinking about

1017
00:48:28,600 --> 00:48:31,719
Speaker 13: designing policies and approaches. And then on the other hand,

1018
00:48:31,719 --> 00:48:34,759
Speaker 13: there's also a flexibility for the managers to be able

1019
00:48:34,760 --> 00:48:37,719
Speaker 13: to have a little bit more autonomy in the decisions

1020
00:48:37,760 --> 00:48:41,319
Speaker 13: they can make and the arrangements they can approve for

1021
00:48:41,400 --> 00:48:42,240
Speaker 13: their team members.

1022
00:48:42,520 --> 00:48:44,720
Speaker 3: Right, it's a whole new world. Everybody's adapting.

1023
00:48:44,760 --> 00:48:49,640
Speaker 1: It seems like Aileen Malany, workforce Transformation lead at Viato Partners,

1024
00:48:49,880 --> 00:48:52,360
Speaker 1: talking about the new workforce is it appears to be

1025
00:48:52,440 --> 00:48:56,560
Speaker 1: for most organizations some form of hybrid, and I guess

1026
00:48:56,840 --> 00:48:58,319
Speaker 1: a lot of folks that are still trying to work

1027
00:48:58,320 --> 00:49:01,520
Speaker 1: that out. But whether it's three two or four to

1028
00:49:01,520 --> 00:49:06,040
Speaker 1: one or something different, hybrid seems to be the new normal.

1029
00:49:06,280 --> 00:49:09,359
Speaker 2: Thanks for listening to the Bloomberg Markets podcasts. You can

1030
00:49:09,400 --> 00:49:13,160
Speaker 2: subscribe and listen to interviews at Apple Podcasts or whatever

1031
00:49:13,239 --> 00:49:16,960
Speaker 2: podcast platform you prefer. I'm Matt Miller. I'm on Twitter

1032
00:49:17,160 --> 00:49:19,080
Speaker 2: at Matt Miller nineteen seventy three.

1033
00:49:19,560 --> 00:49:21,920
Speaker 1: And I'm fall Sweeney. I'm on Twitter at pt Sweeney

1034
00:49:22,040 --> 00:49:24,719
Speaker 1: before the podcast. You can always catch us worldwide at

1035
00:49:24,719 --> 00:49:26,479
Speaker 1: Bloomberg Radio