WEBVTT - Bloomberg Surveillance TV: June 4th, 2026

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along

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<v Speaker 2>with Lisa Bromwitz and Amrie Hordert. Join us each day

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<v Speaker 2>for insight from the best in markets, economics, and geopolitics

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<v Speaker 2>from our global headquarters in New York City. We are

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<v Speaker 3>So here's the latest this morning.

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<v Speaker 2>The President remaining positive on negotiations, as Tehran says there

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<v Speaker 2>has been no tangible progress. Overnight, clashes between Israel and

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<v Speaker 2>Hesbel are complicating talks, as Lebanon's president says a ceasefire

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<v Speaker 2>with Israel could begin within twenty four hours. Joining us

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<v Speaker 2>now round the table, the State Department spokesperson Temmy Figure. Tommy,

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<v Speaker 2>you're the man this morning. Good morning to you. Tell

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<v Speaker 2>us we're making some progress, because I can tell you

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<v Speaker 2>on Wall Street this is the number one story that

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<v Speaker 2>people don't want to talk about right now. Are we

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<v Speaker 2>moving forward?

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<v Speaker 4>Well, look, we're moving forward. And achieving the President's objective.

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<v Speaker 4>I mean, you started saying mixed messaging on Iran, but

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<v Speaker 4>the President's been clear from the beginning what is primary

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<v Speaker 4>objective is here the Ranian regime can't have a nuclear weapon.

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<v Speaker 4>So we saw Operation Epic Fury, the decisive outcomes from that.

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<v Speaker 4>We're seeing in Lebanon and Israel, those talks being separate

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<v Speaker 4>from these talks regard in the nuclear issue, but the

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<v Speaker 4>highest level talks since nineteen ninety three. Progress being made there.

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<v Speaker 4>The President's not going to be rushed into a bad deal.

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<v Speaker 4>He's going to make a good deal for the American people,

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<v Speaker 4>and he's indicated we're seeing some movement here from the

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<v Speaker 4>Iranian side.

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<v Speaker 5>The President yesterday talked about a ceasefire. We talked about

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<v Speaker 5>this a little bit earlier, saying that that basically means

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<v Speaker 5>shooting in a more moderate manner. That's what the ceasefire is.

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<v Speaker 5>What would it take for this administration to say the

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<v Speaker 5>ceasefire is off.

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<v Speaker 4>Well, look, I think what we're seeing here regarding this

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<v Speaker 4>is defensive actions. Of course, saw Operation Epic Fury, decimation

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<v Speaker 4>of their defense industrial complex, their missile complex, their navy,

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<v Speaker 4>for example. But of course We're going to take defensive

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<v Speaker 4>action to protect US interest in US troops. That's a

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<v Speaker 4>common sense approach. We also have in this context economic

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<v Speaker 4>theory that are a blockade, that we have a raniing

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<v Speaker 4>hips are Ragni imports, So there's leverage the president has.

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<v Speaker 3>He has all the cards here and what.

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<v Speaker 4>We saw the Secretary describe before Congress, as we are

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<v Speaker 4>seeing the Iranian regime talk about many of the things

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<v Speaker 4>that they refuse to talk about for months, but the

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<v Speaker 4>President also being clear he's going to see the subjective

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<v Speaker 4>be fulfilled one way or another.

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<v Speaker 3>The Ranian regime cannot have a nucular weapon.

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<v Speaker 5>The Wall Street Journal reporting overnight that Trump told his

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<v Speaker 5>aide that he won't resume in all at war with

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<v Speaker 5>Iran unless US troops are killed. Is that going to

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<v Speaker 5>be the line where potentially we could see more offensive attacks.

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<v Speaker 4>Well, look as the President saying again, we're going to

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<v Speaker 4>take defensive action to protect US troops, US soldiers. I'm

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<v Speaker 4>not here to predict the future about what the President

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<v Speaker 4>may decide, but of course we're going to take that

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<v Speaker 4>defensive action.

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<v Speaker 3>Of course we are.

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<v Speaker 4>That's a common sense approach if we see threats against

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<v Speaker 4>US interests US troops. We're going to be acting and

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<v Speaker 4>the President the DOW has done just that.

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<v Speaker 6>Why isn't the International Atomic Energy Agency involved in these talks?

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<v Speaker 4>Well, I mean we see the President talking about a

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<v Speaker 4>role for the IAEA in terms of the destruction of

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<v Speaker 4>the nuclear dust. The President this has been a longstanding

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<v Speaker 4>concern for the entire world, the threat that the Ranian

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<v Speaker 4>regime having the new the weapon could have. It's the

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<v Speaker 4>President who has taken action to actually address this.

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<v Speaker 6>Well, the IEA came out overnight with a report where

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<v Speaker 6>they said that the risk of Iran developing a nuclear

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<v Speaker 6>weapon right now is higher than it was a number.

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<v Speaker 3>Of months ago.

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<v Speaker 6>We're raising concerns that they don't have access to oversight

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<v Speaker 6>and saying that they would like to be more involved

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<v Speaker 6>in these negotiations. Do you have any understanding of where

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<v Speaker 6>they are in this and the urgency to get them

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<v Speaker 6>in to be able to surveil what's going on.

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<v Speaker 4>Well, again, part of the discussions we're having here, as

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<v Speaker 4>the President has indicated publicly, is regarding the destruction of

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<v Speaker 4>the enriched uranium uranium that was enriched beyond the point

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<v Speaker 4>of any sort of peaceful purpose. The IEA the President

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<v Speaker 4>indicating would play a role within that regarding where the

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<v Speaker 4>Ranian regime is. As the Secretary discussed before Congress, they

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<v Speaker 4>were attempting to develop a conventional weapon shield which they

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<v Speaker 4>could act with basically impunity to develop a nuclear weapon.

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<v Speaker 4>The President taking clear, concrete action to decimate that conventional

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<v Speaker 4>military shield. So the President taking action to prevent the

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<v Speaker 4>Ranium regime from having a nuclear weapon consistently from the

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<v Speaker 4>beginning of this administration.

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<v Speaker 3>How afective is the blockhite Bean.

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<v Speaker 2>We've had this blinking contest for a while trying to

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<v Speaker 2>work out at what point will we breach storage capacity

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<v Speaker 2>in Iran. Have you got anything to share with this

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<v Speaker 2>morning about how effective that blockchite is been.

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<v Speaker 4>Well, it's been incredibly effective in terms of blocking revenue

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<v Speaker 4>from going to the Iranian regime. Hundreds of millions of

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<v Speaker 4>dollars a day being blocked from the Iranian regime. This

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<v Speaker 4>is also the broader context of that maximum pressure policy.

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<v Speaker 4>We're actually continuing to take action at the State Department

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<v Speaker 4>of Treasury Department to target entities that are trying to

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<v Speaker 4>evade US sanctions that are designed to deny the regime

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<v Speaker 4>the funds they need for their Malian activities. We saw

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<v Speaker 4>actions as recently either yesterday or earlier this week. Those

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<v Speaker 4>actions have continuing, so this economic fury is continuing. We're

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<v Speaker 4>seeing in terms of the effect hundreds of millions of

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<v Speaker 4>dollars being denied to the Iranian regime.

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<v Speaker 5>Secretary Rubio was in front of the Senate for Our

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<v Speaker 5>Relations to committee as well this week, and he said

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<v Speaker 5>that Iran has laid very large parts straight overmosse with

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<v Speaker 5>minds have any of them been cleared? How much of

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<v Speaker 5>the strait is still mined?

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<v Speaker 3>Well?

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<v Speaker 4>The President indicating that we're taking operations to see that

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<v Speaker 4>d mining of the strait. I think this also shows

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<v Speaker 4>the difference here the Ranian regime trying to close the

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<v Speaker 4>Straight of Horm Moves and say that we should be

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<v Speaker 4>able to control who goes to the Straight of Horm Moves.

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<v Speaker 4>That's why we saw this blockade of our Rani and

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<v Speaker 4>ships in Iranian ports. We're not going to be in

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<v Speaker 4>a situation where we're going to accept a country deciding,

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<v Speaker 4>you know, laterally who gets to use an international waterway.

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<v Speaker 4>That's not going to happen. The President and the Secretary

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<v Speaker 4>both indicating.

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<v Speaker 2>That Tomy, can you see why people on Wall Street

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<v Speaker 2>right now are slightly frustrangted with some of the communication

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<v Speaker 2>coming from the White House. And I give an example.

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<v Speaker 2>The President sent the straint with reopen back on eight

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<v Speaker 2>posse seventeenth. The strength did not reopen. It feels like

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<v Speaker 2>we get in the same headlines recinncled every week. Can

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<v Speaker 2>you see the frustrangtion right now for people on Wall

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<v Speaker 2>Street track in this story?

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<v Speaker 4>Well, look, I think fundamentally the president's a deal maker.

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<v Speaker 4>We saw the action he takes, the action he needs

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<v Speaker 4>to take. We saw it with Operation midn at Hammer.

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<v Speaker 4>We saw it with He's not making the day lit See.

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<v Speaker 3>Well, I think he's working on that deal.

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<v Speaker 4>I mean we're seeing him make more progress than anyone's

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<v Speaker 4>ever made in terms of this addressing this issue, in

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<v Speaker 4>terms of the real results we've seen from these operations.

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<v Speaker 4>The President wants that diplomatic approach, but fundamentally they're regime

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<v Speaker 4>Canada of nuclear weapon that would have been an untenable

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<v Speaker 4>threat to the region, the entire world.

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<v Speaker 3>That was being address. That has been addressed. That has

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<v Speaker 3>been addressed.

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<v Speaker 2>Stay with us more Bloomberg surveillance coming up after this

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<v Speaker 2>House for investors bracing for the May payrolls report you

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<v Speaker 2>out tomorrow. The Dallas FED president Lori Logan, signating optimism

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<v Speaker 2>that AI will boost labor demand.

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<v Speaker 7>There are a number of data centers that are either

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<v Speaker 7>in the planning stage or in the construction stage, and

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<v Speaker 7>that's creating significant demand for labor. We're seeing wage growth

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<v Speaker 7>in those particular areas.

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<v Speaker 2>Joining us now to discuss Bessie Stevenson of the Ford

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<v Speaker 2>School of Public Policy at Michigan University, Betsy, welcome back

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<v Speaker 2>to the program. So it's good to hear from you.

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<v Speaker 2>There's a great debate on the future of this labor

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<v Speaker 2>market given the technological revolution we're working through right now. Betsy,

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<v Speaker 2>how are your thoughts evolving on that mat.

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<v Speaker 1>Set well, I mean, I think what we've just heard

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<v Speaker 1>her say is we're going to see a lot of

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<v Speaker 1>construction workers as we build data centers, but that's not

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<v Speaker 1>a solution to the challenges for white collar workers as

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<v Speaker 1>AI starts to increase efficiency. I mean, I think what

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<v Speaker 1>we're seeing right now is a lot of companies that

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<v Speaker 1>are still doing really well and able to grow, and

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<v Speaker 1>that's why we're not seeing a lot of layoffs. But

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<v Speaker 1>we're also not seeing a lot of hiring and so

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<v Speaker 1>what they're doing is they're trying to take these gains

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<v Speaker 1>in terms of increased productivity so that they can increase

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<v Speaker 1>their output, but they can do it without hiring workers.

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<v Speaker 1>And that I think is I think that's the best

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<v Speaker 1>way for technology to work through the labor market is

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<v Speaker 1>to do it in a period of growth, so that

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<v Speaker 1>people don't lose jobs, but the people who have jobs

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<v Speaker 1>become more productive. The challenge for the US right now

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<v Speaker 1>is that it is such a low higher, low fire

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<v Speaker 1>environment that the people who do need to enter the

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<v Speaker 1>labor market, either they lose a job or they've been

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<v Speaker 1>out of the labor market and need to re enter.

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<v Speaker 1>They're the ones struggling, and that's why we're seeing the

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<v Speaker 1>rate of long term unemployed increasing.

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<v Speaker 2>Betsy's really hard for us to judge at the moment

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<v Speaker 2>just how tight this labor market actually is. As you

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<v Speaker 2>reflect on there, we've had this negative supply shock to

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<v Speaker 2>the labor market. We haven't had the entrance come into

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<v Speaker 2>the supply polls, so to speak, because of these tights

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<v Speaker 2>of regulations around immigration and the enforcement of the southern border. Betsy,

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<v Speaker 2>with that in mind, how do you gauge how loose

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<v Speaker 2>source supply how loose or tight this labor market actually

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<v Speaker 2>is right.

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<v Speaker 1>Now, you know, I think it's actually a labor market

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<v Speaker 1>where we want to look at the particular skills that

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<v Speaker 1>workers have to think about whether it's loose or tight

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<v Speaker 1>is going to depend on exactly the market that you're

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<v Speaker 1>in and.

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<v Speaker 3>The skills that you have.

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<v Speaker 1>So I think of it as a time of great reshuffling.

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<v Speaker 1>You might find that you're in actually quite wee labor

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<v Speaker 1>market given your skills and where you're at, and that

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<v Speaker 1>might mean that you need to skill up with something

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<v Speaker 1>different or relocate. So that's part of why I think

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<v Speaker 1>we see it as both. Wait, it's a weak labor market. No,

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<v Speaker 1>it's a tight labor market. I think it's because it's both,

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<v Speaker 1>and it really depends on exactly where you are and what.

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<v Speaker 3>Set of skills you have.

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<v Speaker 6>Betsy, where are we in what you referred to before

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<v Speaker 6>as the white collar recession?

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<v Speaker 1>Well, I don't think we're in a white collar recession,

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<v Speaker 1>but I do think that we're not really prepared for

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<v Speaker 1>a lot of white collar workers to need to make

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<v Speaker 1>some transitions. Now, there are some good things. One is

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<v Speaker 1>that white collar workers have developed a lot of skills

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<v Speaker 1>around how to learn and develop new skills. So that

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<v Speaker 1>makes them actually really well positioned to make changes as

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<v Speaker 1>their company says, hey, I don't need you to do

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<v Speaker 1>this anymore, but we might need you to do this

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<v Speaker 1>other set of tasks. Learn how to do them, can

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<v Speaker 1>you scale up? And I think historically we have seen

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<v Speaker 1>that many workers are able to do this. And you know,

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<v Speaker 1>one of the other things with AI is that it

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<v Speaker 1>is disproportionately going to impact women's jobs. Jobs held by women,

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<v Speaker 1>and women have historically been a bit more flexible around

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<v Speaker 1>WHOA I need to change what I'm doing because my

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<v Speaker 1>old job isn't there anymore. So I have a lot

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<v Speaker 1>of optimism that we're going to have a lot of

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<v Speaker 1>ongoing demand for human workers, and we have workers who

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<v Speaker 1>are able to have the flexibility needed to make changes.

0:10:37.160 --> 0:10:41.080
<v Speaker 1>But I think we should understand that any period where

0:10:41.080 --> 0:10:44.400
<v Speaker 1>people are having to make changes, where there's uncertainty, is

0:10:44.440 --> 0:10:48.200
<v Speaker 1>going to be a period of weaker consumer confidence and

0:10:48.320 --> 0:10:51.720
<v Speaker 1>anxiety around for the public.

0:10:52.040 --> 0:10:55.120
<v Speaker 6>So if you push this through the FEDES response mechanism,

0:10:55.160 --> 0:10:56.480
<v Speaker 6>A lot of people are looking at the Lave of

0:10:56.520 --> 0:10:59.640
<v Speaker 6>Market report tomorrow as a guide to whether the lave

0:10:59.679 --> 0:11:02.880
<v Speaker 6>of mark it can be some sort of indication of

0:11:02.960 --> 0:11:05.800
<v Speaker 6>weakness that could leave the FED on hold and definitely

0:11:05.880 --> 0:11:08.920
<v Speaker 6>or even remaining with an easing bias. Do you think

0:11:08.960 --> 0:11:11.800
<v Speaker 6>it's an appropriate stance for the FED to be a

0:11:11.800 --> 0:11:14.520
<v Speaker 6>bit more dubvish with this type of backdrop, or do

0:11:14.559 --> 0:11:17.520
<v Speaker 6>you think that they should prioritize inflation because of the

0:11:17.600 --> 0:11:19.440
<v Speaker 6>uncertainties around the labor backdrop.

0:11:20.400 --> 0:11:22.760
<v Speaker 1>Look, inflation isn't good for workers either.

0:11:23.160 --> 0:11:24.040
<v Speaker 3>I think you know.

0:11:24.840 --> 0:11:28.200
<v Speaker 1>Jerome pal said that a few press conferences ago, and

0:11:28.200 --> 0:11:31.520
<v Speaker 1>it really stuck with me because I think it's important

0:11:31.520 --> 0:11:36.400
<v Speaker 1>to remember that workers don't want unemployment, but they also

0:11:36.480 --> 0:11:40.120
<v Speaker 1>don't want inflation, and so then what the FED has

0:11:40.200 --> 0:11:43.240
<v Speaker 1>to do is look at what can they be more

0:11:43.280 --> 0:11:47.280
<v Speaker 1>certain about right now. Unfortunately, they can be more certain

0:11:47.520 --> 0:11:52.199
<v Speaker 1>about inflationary pressure than they can about a weak economy.

0:11:52.400 --> 0:11:55.920
<v Speaker 1>Right we still see a GDP now forecast for Q

0:11:56.000 --> 0:12:00.600
<v Speaker 1>two of three percent, where we saw jolt job openings

0:12:00.640 --> 0:12:02.400
<v Speaker 1>actually rise in April.

0:12:02.720 --> 0:12:04.000
<v Speaker 3>I don't think we.

0:12:03.920 --> 0:12:08.400
<v Speaker 1>Should overinterpret those as the economy is really strong, but

0:12:08.679 --> 0:12:11.719
<v Speaker 1>I do think that they make it hard for the

0:12:11.720 --> 0:12:15.120
<v Speaker 1>FED to justify cutting rates at this moment.

0:12:15.200 --> 0:12:18.439
<v Speaker 5>But Betsy, this inflationary pressure is coming from a conflict

0:12:18.520 --> 0:12:22.679
<v Speaker 5>and its energy driven. Isn't the FED historically haven't they

0:12:22.679 --> 0:12:23.800
<v Speaker 5>been taught to look through this?

0:12:25.400 --> 0:12:27.400
<v Speaker 1>I really I love this. I feel like I was

0:12:27.400 --> 0:12:30.280
<v Speaker 1>like in my econ macro class and a student was like, Hey,

0:12:30.280 --> 0:12:32.760
<v Speaker 1>we're supposed to look through this. You're one hundred percent right.

0:12:33.600 --> 0:12:37.760
<v Speaker 1>But there's one problem. We had high inflation in twenty

0:12:37.800 --> 0:12:41.120
<v Speaker 1>twenty one, and we have a public that is on

0:12:41.679 --> 0:12:45.720
<v Speaker 1>tender hooks worried about inflation. What that means is that

0:12:45.760 --> 0:12:49.960
<v Speaker 1>inflation expectations may not be as well anchored as we

0:12:50.080 --> 0:12:52.360
<v Speaker 1>need them to be in order to look through a

0:12:52.400 --> 0:12:55.800
<v Speaker 1>brief period of inflation. So what the FED has to

0:12:55.840 --> 0:12:58.920
<v Speaker 1>be looking at is you're absolutely right, not what is

0:12:58.960 --> 0:13:02.400
<v Speaker 1>the transitory inflation that's going to pass through very quickly,

0:13:02.760 --> 0:13:06.440
<v Speaker 1>but what's the potential for that transitory inflation to become sticky,

0:13:06.880 --> 0:13:09.559
<v Speaker 1>either because it takes the conflict a while to resolve,

0:13:10.160 --> 0:13:13.000
<v Speaker 1>or because inflation expectations are not well anchored.

0:13:13.640 --> 0:13:17.160
<v Speaker 2>Stay with us. More Bloomberg Surveillance coming up after this.

0:13:26.320 --> 0:13:28.680
<v Speaker 2>We begin this now with stock setting lower after broadcome

0:13:28.720 --> 0:13:31.920
<v Speaker 2>results call off the record breaking run for chip makers.

0:13:32.080 --> 0:13:34.520
<v Speaker 2>Tracyman Miller of wels Farco with a year end target

0:13:34.600 --> 0:13:37.000
<v Speaker 2>on the S and P of seventy five hundred, expecting

0:13:37.040 --> 0:13:40.439
<v Speaker 2>no fed rate moves, a better economy, and increased M

0:13:40.520 --> 0:13:43.840
<v Speaker 2>and A activity through to year end. Tracy joins us

0:13:43.840 --> 0:13:46.200
<v Speaker 2>now for more Tracy a rinkle this morning, and good

0:13:46.200 --> 0:13:48.800
<v Speaker 2>to see you, and that wrinkle comes from Broadcome. What's

0:13:48.800 --> 0:13:51.000
<v Speaker 2>the lesson from the price section this morning?

0:13:52.400 --> 0:13:56.199
<v Speaker 8>Good morning, John. So the lesson is that after such

0:13:56.760 --> 0:14:02.240
<v Speaker 8>an amazing run like we've seen in the AI names,

0:14:02.520 --> 0:14:07.200
<v Speaker 8>there is still some room for disappointment. So we have

0:14:07.480 --> 0:14:12.000
<v Speaker 8>overweighted information technology, but we're telling investors not to chase

0:14:12.559 --> 0:14:16.480
<v Speaker 8>those names at these prices right now, and that there

0:14:16.520 --> 0:14:22.000
<v Speaker 8>are probably better opportunities in some other sectors like industrials

0:14:22.160 --> 0:14:24.440
<v Speaker 8>or utilities or even financials.

0:14:24.520 --> 0:14:27.080
<v Speaker 2>We've liked financials. That's been a high conviction coll and

0:14:27.120 --> 0:14:29.600
<v Speaker 2>Tracy hasn't been working. Why hasn't it been working a

0:14:29.600 --> 0:14:30.520
<v Speaker 2>while with that change.

0:14:31.320 --> 0:14:34.760
<v Speaker 8>Yeah, so it hasn't been working because of the steepening

0:14:35.000 --> 0:14:40.080
<v Speaker 8>yield I'm sorry, the flattening yield curve and the private

0:14:40.160 --> 0:14:44.080
<v Speaker 8>credit issues. And we think that going forward we are

0:14:44.160 --> 0:14:46.640
<v Speaker 8>going to start to see that yield curve steep in

0:14:46.800 --> 0:14:51.440
<v Speaker 8>some Right now, there are a couple of price rate

0:14:51.560 --> 0:14:54.480
<v Speaker 8>hikes priced into the markets. We think those are going

0:14:54.560 --> 0:14:57.040
<v Speaker 8>to come out by the end of the year, and

0:14:57.080 --> 0:15:01.440
<v Speaker 8>we also see some additional potent upside and rates on

0:15:01.480 --> 0:15:04.800
<v Speaker 8>the long end. M and A activity You mentioned that

0:15:05.000 --> 0:15:09.760
<v Speaker 8>as well IPO activity both really good for investment banking.

0:15:09.920 --> 0:15:13.360
<v Speaker 8>So all of those things we think support financials.

0:15:13.440 --> 0:15:16.080
<v Speaker 6>We were talking about concerns around private credit. We're getting

0:15:16.080 --> 0:15:19.640
<v Speaker 6>another headline this morning the Blackstone Private Credit fund plants

0:15:19.640 --> 0:15:22.920
<v Speaker 6>of cap investor redemptions at five percent. This comes amid

0:15:23.040 --> 0:15:25.240
<v Speaker 6>a slew of different information that we've been hearing and

0:15:25.760 --> 0:15:28.600
<v Speaker 6>including from the Swiss Partners Capital we were talking about

0:15:28.600 --> 0:15:31.480
<v Speaker 6>earlier this morning. Does this give you pause or do

0:15:31.520 --> 0:15:35.320
<v Speaker 6>you think that this is noise given a duration mismatch,

0:15:35.560 --> 0:15:38.360
<v Speaker 6>and not necessarily a broader signal about the market.

0:15:38.960 --> 0:15:42.360
<v Speaker 8>Yeah, so we think that that is not necessarily a

0:15:42.440 --> 0:15:47.040
<v Speaker 8>broader signal about the market. We're watching spreads in the

0:15:47.080 --> 0:15:52.840
<v Speaker 8>public markets that are at near record tights, and so

0:15:52.920 --> 0:15:57.040
<v Speaker 8>we don't see broad concern in the fixed income markets.

0:15:57.200 --> 0:16:00.760
<v Speaker 8>That said, there are some pockets in the private credit

0:16:00.840 --> 0:16:05.040
<v Speaker 8>market that obviously investors are starting to worry about, and

0:16:05.360 --> 0:16:09.600
<v Speaker 8>so we would tell investors that it's important to keep

0:16:09.720 --> 0:16:14.440
<v Speaker 8>that diversification within a fixed income portfolio, with some potentially

0:16:14.480 --> 0:16:17.960
<v Speaker 8>in private credit if that fits their risk profile. But

0:16:18.520 --> 0:16:21.680
<v Speaker 8>in the public markets we are just not seeing that strained.

0:16:22.240 --> 0:16:25.720
<v Speaker 6>There's also an issue of consumer spending with their wages

0:16:25.800 --> 0:16:28.800
<v Speaker 6>not really keeping pace. We just saw credit card balances

0:16:29.160 --> 0:16:32.120
<v Speaker 6>hit a record one point two eight trillion dollars. On

0:16:32.160 --> 0:16:34.280
<v Speaker 6>the margins delinquencies picking up.

0:16:34.600 --> 0:16:35.240
<v Speaker 3>Do you see.

0:16:35.120 --> 0:16:36.800
<v Speaker 6>Signs that consumer is getting tired?

0:16:36.840 --> 0:16:37.880
<v Speaker 3>Does that give you pause?

0:16:39.200 --> 0:16:44.040
<v Speaker 8>Yeah, so definitely there is a component, a segment of

0:16:44.120 --> 0:16:48.400
<v Speaker 8>the consumer that is starting to get stretched, get tired,

0:16:48.760 --> 0:16:51.240
<v Speaker 8>if you will. We've talked about, you know, the higher

0:16:51.320 --> 0:16:55.960
<v Speaker 8>prices that they are experiencing, and so they continue to spend,

0:16:56.280 --> 0:16:58.960
<v Speaker 8>but some of that spending is now coming from saving,

0:16:59.120 --> 0:17:02.880
<v Speaker 8>some of it's going onto credit cards. And I think

0:17:03.000 --> 0:17:07.880
<v Speaker 8>the positive here is that it's not all consumers, and

0:17:08.200 --> 0:17:12.199
<v Speaker 8>we are continuing to see you know, some firming in

0:17:12.240 --> 0:17:15.639
<v Speaker 8>the labor markets. And as long as consumers have jobs,

0:17:15.800 --> 0:17:20.240
<v Speaker 8>they can continue to spend. And really all we're expecting

0:17:20.359 --> 0:17:23.600
<v Speaker 8>from the consumption part of GDP this year is maybe

0:17:23.680 --> 0:17:28.240
<v Speaker 8>a modest improvement because most of our GDP expectation is

0:17:28.280 --> 0:17:29.439
<v Speaker 8>coming from cafets.

0:17:30.240 --> 0:17:32.160
<v Speaker 5>Christy, what do you think about the energy space right now.

0:17:32.200 --> 0:17:33.639
<v Speaker 5>I notice in your note you said you want your

0:17:33.640 --> 0:17:36.480
<v Speaker 5>investor's portfolios to trim energy equities and commodities. But we

0:17:36.720 --> 0:17:39.400
<v Speaker 5>just heard from almost Hawkstein who basically said, we're living

0:17:39.480 --> 0:17:42.400
<v Speaker 5>right now globally on a buffer, and when that dries up,

0:17:42.520 --> 0:17:45.400
<v Speaker 5>you know, we could see tremendous upside when it comes

0:17:45.400 --> 0:17:46.400
<v Speaker 5>to energy prices.

0:17:47.640 --> 0:17:50.960
<v Speaker 8>Yeah, so we are telling our investors that it is

0:17:51.000 --> 0:17:54.159
<v Speaker 8>a source of funds for some other areas of the

0:17:54.200 --> 0:17:59.520
<v Speaker 8>market where we see better valuation. So we're not necessarily

0:18:00.400 --> 0:18:04.440
<v Speaker 8>the fact that almost a billion barrels of oil have

0:18:04.560 --> 0:18:07.439
<v Speaker 8>been lost through this conflict, and that there are going

0:18:07.520 --> 0:18:10.680
<v Speaker 8>to be some pockets of the global economy that are

0:18:10.680 --> 0:18:14.159
<v Speaker 8>going to start to experience severe shortages if we don't

0:18:14.240 --> 0:18:20.040
<v Speaker 8>get oil flowing again. That said, though, we do think

0:18:20.119 --> 0:18:23.840
<v Speaker 8>that when oil spikes that it is an opportunity for

0:18:23.960 --> 0:18:27.280
<v Speaker 8>investors to reposition because we don't think this is a

0:18:27.520 --> 0:18:31.399
<v Speaker 8>long term supply issue. It's a supply shock.

0:18:32.040 --> 0:18:35.960
<v Speaker 5>Is this basically investors needing some capital to allocate elsewhere

0:18:36.040 --> 0:18:39.160
<v Speaker 5>maybe with some upcoming IPOs? Where else do you see

0:18:39.160 --> 0:18:41.600
<v Speaker 5>investors moving money around to make sure that they are

0:18:41.600 --> 0:18:43.200
<v Speaker 5>getting in on that AI race.

0:18:44.359 --> 0:18:48.520
<v Speaker 8>Yeah, so we definitely think we see that happening. We

0:18:48.680 --> 0:18:52.400
<v Speaker 8>have seen the mag seven starting to underperform, we've seen

0:18:52.440 --> 0:18:55.600
<v Speaker 8>crypto underperforming, and so we think it's some of those

0:18:55.680 --> 0:19:00.480
<v Speaker 8>higher beta areas of the market where investors are pulling funds,

0:19:00.560 --> 0:19:04.400
<v Speaker 8>raising cash, so they will have us that cash available

0:19:04.880 --> 0:19:08.359
<v Speaker 8>as these big IPOs come to market through the summer.

0:19:09.160 --> 0:19:12.680
<v Speaker 2>This is the Bloomberg Surveillance Podcast, bringing you the best

0:19:12.760 --> 0:19:16.080
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