WEBVTT - Lilly’s Zepbound Cuts Risk of Diabetes 0:00:00.600 --> 0:00:08.600 Bloomberg Audio Studios, podcasts, radio news. 0:00:09.960 --> 0:00:13.840 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:00:13.920 --> 0:00:17.000 weekdays at ten am Eastern on Affle Cardplay and Android 0:00:17.000 --> 0:00:20.120 Auto with the Bloomberg Business App. Listen on demand wherever 0:00:20.160 --> 0:00:24.000 you get your podcasts, or watch us live on YouTube. 0:00:24.920 --> 0:00:27.600 Alex Delaul Sweeney live here in our Bloomberg Interactive Brokers 0:00:27.640 --> 0:00:29.040 studio in New York City. 0:00:29.120 --> 0:00:30.520 We're also streaming livel on Youtubes. 0:00:30.520 --> 0:00:32.920 Ahead over to YouTube dot com and search Bloomberg Podcast 0:00:32.920 --> 0:00:36.000 and that's where you'll find this. Eli Lilly stock's hitting 0:00:36.000 --> 0:00:40.479 it up four percent today, all time high stocks up 0:00:40.520 --> 0:00:43.320 like fifty eight percent year to date. Patients taking Eli 0:00:43.320 --> 0:00:46.760 Lilli's blockbuster weight loss shot We're ninety four percent less 0:00:46.920 --> 0:00:49.440 likely to develop diabetes in a three year study that 0:00:49.479 --> 0:00:53.280 illuminates the long term health benefits of treating obesity and Alex. 0:00:53.320 --> 0:00:55.560 As you mentioned, these are just like wonder drugs. 0:00:55.680 --> 0:00:57.800 I mean, it definitely feels like they're all magical. 0:00:58.080 --> 0:01:00.720 They're magical thing. Yeah, they cure everything. So I need 0:01:00.720 --> 0:01:03.240 to figure out what's going on here. Sam Fazzelli he 0:01:03.320 --> 0:01:05.399 joined to SEE as the director of Research for Global Industries. 0:01:05.480 --> 0:01:07.959 He's a senior pharmaceutical analyst. That that's his day job 0:01:08.000 --> 0:01:10.920 for Bloomberg Intelligence. And believe it or not, he's actually 0:01:11.000 --> 0:01:12.840 at his desk in the London. 0:01:13.040 --> 0:01:15.520 He was in Bordeaux on Friday, and I was gonna. 0:01:15.319 --> 0:01:18.280 Say I expected him to be in some dialing from 0:01:18.360 --> 0:01:21.959 some exotic locale in Europe somewhere, but he's actually this 0:01:22.040 --> 0:01:22.600 is exotic. 0:01:22.720 --> 0:01:24.000 Look yeah, exactly. 0:01:24.480 --> 0:01:26.240 The ceiling looks pretty cool, all right. 0:01:26.080 --> 0:01:28.200 So Sam, I mean, well, thank you for coming into 0:01:28.240 --> 0:01:31.479 work as opposed to your peers there Bi Sam talk 0:01:31.520 --> 0:01:35.400 to us about Eli Lilly, their drugs here and obese. 0:01:35.400 --> 0:01:37.440 These numbers just jump out at you, don't. 0:01:37.240 --> 0:01:39.520 They They do, they do. 0:01:39.680 --> 0:01:42.679 But let me take you back a little bit where 0:01:42.680 --> 0:01:45.360 we not always told we went to the doctor and 0:01:45.400 --> 0:01:48.680 we started glucose was going up. Not not you guys, 0:01:48.680 --> 0:01:53.000 obviously you're a fascinatingly amazingly healthy and fit, but those 0:01:53.040 --> 0:01:55.640 who weren't and told you need to lose some weight 0:01:55.680 --> 0:01:58.520 to my friend, because you have risk of developing diabetes. 0:01:59.040 --> 0:02:02.880 So where is the if you reduce weight and manage 0:02:02.920 --> 0:02:06.800 the obesity, you lose all these you know, I'll be 0:02:06.880 --> 0:02:11.600 suppeating this thing, sleep APNA, risk of developing diabetes, everything 0:02:11.639 --> 0:02:13.760 that we're talking about here. You eat less, you lose 0:02:13.760 --> 0:02:18.720 weight less risk of developing diabetes, So not exactly a shock. Nevertheless, 0:02:18.760 --> 0:02:21.760 it's great to see that it actually does what it 0:02:21.760 --> 0:02:25.600 says under tin that by reducing weight you do manage 0:02:25.600 --> 0:02:28.840 all these side effects. But before we get too excited, 0:02:28.880 --> 0:02:31.760 I want to highlight one little wrinkle here. It's no 0:02:31.800 --> 0:02:34.360 wrinkle with the data if you read the press release, 0:02:34.360 --> 0:02:36.079 and I've got it right up here on my terminal 0:02:36.440 --> 0:02:40.160 eli Leui coming announced today positive top line results from 0:02:40.200 --> 0:02:43.200 this amount one a three year study, one hundred and 0:02:43.240 --> 0:02:48.440 seventy six week treatment period. Find me somebody who stayed 0:02:48.520 --> 0:02:50.840 in the real world on this drug for one hundred 0:02:50.880 --> 0:02:55.160 and seventy six weeks, so we survey physicians. But if 0:02:55.200 --> 0:02:59.079 we find forty weeks, I'm sure it's going to go up. 0:02:59.280 --> 0:03:02.760 But that very different setting. So how much of a 0:03:02.840 --> 0:03:06.080 real world will this actually translate into in terms of 0:03:06.320 --> 0:03:07.480 preventing diabetes. 0:03:07.800 --> 0:03:08.359 Time will tell. 0:03:08.520 --> 0:03:10.440 So you're not saying that the study was bogus. You're 0:03:10.440 --> 0:03:13.480 saying the study was real. But in reality, people don't 0:03:13.680 --> 0:03:16.200 stay that long on the drug. Therefore the results won't 0:03:16.200 --> 0:03:17.800 be as magical for them. 0:03:18.520 --> 0:03:21.360 Right in clinical trials, you get the best possible data 0:03:21.360 --> 0:03:23.480 basically because it's highly controlled. 0:03:23.520 --> 0:03:26.359 People are followed, you make sure that they stay on. 0:03:27.040 --> 0:03:30.000 There would probably have been people who have dropped off here, 0:03:30.040 --> 0:03:35.200 so maybe the actual average treatment period wasn't exactly one 0:03:35.280 --> 0:03:38.240 hundred and seventy six weeks for everybody, because people do 0:03:38.360 --> 0:03:41.240 drop off. And I'm assuming in this trial the data 0:03:41.280 --> 0:03:43.400 they're reporting to us is what's called intent to treat, 0:03:44.000 --> 0:03:44.320 i e. 0:03:44.760 --> 0:03:46.240 You've intended to treat that patience. 0:03:46.280 --> 0:03:49.200 Whatever happens to them, you still count them, even if 0:03:49.240 --> 0:03:51.440 they've fallen off the drug. Nevertheless, we need to see 0:03:51.480 --> 0:03:54.160 the detail. But in a trial setting things always look 0:03:54.200 --> 0:03:57.320 better than in real world. So here we have to remember. 0:03:57.760 --> 0:04:00.920 Average stay time according to our is that Mike show 0:04:01.000 --> 0:04:04.600 My colleague runs every six months. It's about forty weeks, 0:04:04.640 --> 0:04:07.560 similar to what we get for we go VI and people, 0:04:07.640 --> 0:04:09.240 and even the press release they say as soon as 0:04:09.280 --> 0:04:11.520 they came off, weight went back up and the risks 0:04:11.520 --> 0:04:14.480 started going up again of developing diabetes. So this is 0:04:14.520 --> 0:04:16.520 not something that you've cleaned it all up. I can 0:04:16.640 --> 0:04:18.920 stop now at one hundred and seventy six and I'm done. 0:04:19.040 --> 0:04:20.760 It's the same story over again. 0:04:20.960 --> 0:04:21.680 Right, exactly. 0:04:22.080 --> 0:04:24.640 So I mean, so look at the stock for Eli 0:04:24.680 --> 0:04:26.720 literly Sam, I say, it's up sixty four percent year 0:04:26.720 --> 0:04:27.920 to date, all time high. 0:04:28.080 --> 0:04:32.440 How much of this stock performance is these glps? 0:04:33.880 --> 0:04:37.839 Oh gosh, if you know, if you look at the 0:04:37.920 --> 0:04:40.640 chart and look at the flow of information and news 0:04:40.720 --> 0:04:44.160 and the upgrades et cetera that are coming to quarterlies, 0:04:44.240 --> 0:04:47.479 every quarterly result et cetera, to sales, I would say 0:04:47.520 --> 0:04:50.520 a meaningful chunk of this. I can't quantify it exactly 0:04:50.520 --> 0:04:52.920 because this is a company that's got other stuff going 0:04:52.960 --> 0:04:58.880 on Alzheimer's disease, oncology, you know, the skin diseases, et cetera. 0:04:58.920 --> 0:05:02.240 So this is not a one trick pony, but a 0:05:02.320 --> 0:05:04.640 large amount of this story. And you can tell by 0:05:04.640 --> 0:05:07.960 when somebody reports a positive result in a competitor setting. 0:05:07.720 --> 0:05:09.279 These stocks sell off four or five percent. 0:05:09.880 --> 0:05:12.400 Right, You remember the days with rash only three or 0:05:12.440 --> 0:05:15.240 four weeks ago, I think, right, And let's not forget 0:05:15.760 --> 0:05:18.680 in a few weeks time, we have the European Association 0:05:18.760 --> 0:05:21.800 for the Study of Diabetes Russia's data is coming out. 0:05:22.120 --> 0:05:23.960 Somebody is going to be up three or four percent 0:05:24.000 --> 0:05:26.040 that day, and somebody's going to be down three or 0:05:26.040 --> 0:05:27.240 four percent who it is. 0:05:27.400 --> 0:05:28.640 We'll see what the data says. 0:05:29.200 --> 0:05:32.200 So the point that you made that if people come 0:05:32.240 --> 0:05:34.040 off it and they gain the weight back, so in 0:05:34.040 --> 0:05:37.080 that sense, it's not like everlastingly magical. Will there be 0:05:37.160 --> 0:05:39.880 iterations though where that won't be the case. 0:05:41.560 --> 0:05:43.320 There's two ways of doing dealing with this. 0:05:43.440 --> 0:05:45.600 So you go on the drug, you come off the drug, 0:05:45.680 --> 0:05:47.359 you go back on the drug, you come off the drug, 0:05:47.360 --> 0:05:50.240 and you just do your cycling every few years after 0:05:50.320 --> 0:05:52.640 you've got to a point where you think, I don't 0:05:52.680 --> 0:05:55.080 know why people come off the drug necessarily on an 0:05:55.080 --> 0:05:57.440 average is it side effect tends to get a lot 0:05:57.480 --> 0:05:59.560 better over time, and. 0:06:00.000 --> 0:06:00.679 Maybe it's cost. 0:06:01.520 --> 0:06:03.680 Maybe it's because they're fed up begin taking an injection 0:06:03.760 --> 0:06:05.960 every week. So if you put all those things together, 0:06:06.000 --> 0:06:09.480 as they get cheaper and injections become once a month, 0:06:09.520 --> 0:06:12.599 maybe or they become oral for the maintenance phase of 0:06:12.600 --> 0:06:15.760 the dose, and that oral doesn't make you feel ill, 0:06:15.960 --> 0:06:18.839 feel ill every time you take it in terms of 0:06:18.839 --> 0:06:22.880 gastric intestinal maybe that's the future. Maybe there are other modalities. 0:06:23.120 --> 0:06:27.880 Amlin is one that Nova Notice and Zealand Farm are 0:06:27.920 --> 0:06:31.479 developing as a target that seems to have less side 0:06:31.480 --> 0:06:36.920 effect issues. Maybe you can maintain your weight loss by 0:06:36.920 --> 0:06:39.440 those drugs which don't have the same side effect issue. 0:06:39.640 --> 0:06:42.880 So that has to be the way that you see it. 0:06:42.880 --> 0:06:45.560 But nobody ever complies with the drug forever. 0:06:46.160 --> 0:06:50.200 Right When do the pharmaceutical companies SAM have a timetable 0:06:50.240 --> 0:06:53.080 for when they will have a pill format as opposed 0:06:53.080 --> 0:06:53.680 to an injection. 0:06:54.920 --> 0:06:57.240 Yeah, so they're all trying to develop them. There are 0:06:57.240 --> 0:06:59.279 a couple of companies Russia and Astros and a Covich. 0:06:59.279 --> 0:07:03.000 I've got what we would call traditional potentially small molecules 0:07:03.040 --> 0:07:05.240 that comes in a pill, so it's not the same 0:07:05.880 --> 0:07:10.160 biologic that you're currently seeing. The folks who are developing 0:07:10.280 --> 0:07:14.360 these same glpe GPS, et cetera. Are also trying to 0:07:14.440 --> 0:07:16.720 formulate them so that they can be taken orally. The 0:07:16.800 --> 0:07:19.800 trick there is if it starts releasing in the stomach, 0:07:19.840 --> 0:07:21.520 you need to take them on an empty stomach so 0:07:21.520 --> 0:07:22.400 that you get absorption. 0:07:22.520 --> 0:07:24.640 If you take them on a full stomach, then they 0:07:24.680 --> 0:07:25.239 have a problem. 0:07:25.520 --> 0:07:27.360 So that becomes a bit of a headache for somebody 0:07:27.360 --> 0:07:30.160 who gets up in the morning decides to eat or 0:07:30.200 --> 0:07:32.840 not eat, and then they also get side effects. So 0:07:33.080 --> 0:07:36.560 I would say three or four years there is already 0:07:36.600 --> 0:07:40.280 a diabetes version, Robeltsi's on the market as an oral. 0:07:40.680 --> 0:07:41.960 But let's say three or four years. 0:07:42.800 --> 0:07:45.640 What about heart disease? Does it actually cure heart or 0:07:45.720 --> 0:07:47.760 reduced death? I should say, and heart disease? 0:07:48.440 --> 0:07:50.040 Yeah, yeah, we know that already. We do we do, 0:07:50.080 --> 0:07:50.760 we do, we do that. 0:07:50.840 --> 0:07:54.240 We know that already from the cardiovascular outcomes trials, the 0:07:54.280 --> 0:07:58.240 sea VOTs that they've done, at least for Novo, I'd 0:07:58.240 --> 0:08:01.240 be very shocked if, if, if Lily doesn't get the 0:08:01.240 --> 0:08:01.760 same result. 0:08:02.680 --> 0:08:05.640 So for those on YouTube, there is literally no one. 0:08:05.960 --> 0:08:07.760 I tak two people, two people. 0:08:07.480 --> 0:08:11.360 In Sam's guys. It's it's five, it's three thirty here, 0:08:11.400 --> 0:08:14.000 it's tea time. We're in England. It's they're all up 0:08:14.000 --> 0:08:15.440 there having their tea. 0:08:15.760 --> 0:08:18.480 Tree thirty in the afternoon. Man pauls on the beach 0:08:18.480 --> 0:08:21.960 at that. Yeah, you're on the beach at b there 0:08:22.000 --> 0:08:22.280 you go. 0:08:22.800 --> 0:08:24.840 All right, Hey, Sam, I turned my camera that way. 0:08:24.840 --> 0:08:25.680 You see a lot more people. 0:08:25.720 --> 0:08:28.280 Okay, give me, we got like thirty seconds left here. 0:08:28.800 --> 0:08:31.360 What what's the exciting thing that you and your team 0:08:31.360 --> 0:08:33.320 are working on in terms of, you know what some 0:08:33.360 --> 0:08:35.760 of these treatments are out there that people need to 0:08:35.760 --> 0:08:36.600 be paying attention to. 0:08:37.600 --> 0:08:40.480 Yeah in general, I mean or we see the diabetes general. 0:08:40.520 --> 0:08:43.200 Okay, So we've got three three conferences coming up that 0:08:43.240 --> 0:08:45.880 we're all excited to buy. And as I said, the 0:08:46.120 --> 0:08:49.280 European Diabetes Conference. There RASH will get the data and 0:08:49.280 --> 0:08:51.440 we'll get some cuts of other data that would be 0:08:51.440 --> 0:08:55.760 an interesting one to look at. For ASMO European Oncology Conference, 0:08:56.240 --> 0:08:59.160 new data coming out, some press releases today for potentially 0:08:59.200 --> 0:09:02.920 surprising data. And then the World Lung Conference where we 0:09:03.000 --> 0:09:06.079 have some new modalities being presented. All of them will 0:09:06.120 --> 0:09:08.560 have something funky going on. And for the cancer ones, 0:09:08.600 --> 0:09:12.600 we have a webinar coming up hopefully for our clients. 0:09:12.720 --> 0:09:14.280 Very good. Sam Fazzelli, thank you so much. 0:09:14.320 --> 0:09:17.520 As always, director of Research for Global Industries. I'm not 0:09:17.520 --> 0:09:19.160 sure what that means. You should just be head of 0:09:19.160 --> 0:09:20.960 European Research when I was part of this thing, but 0:09:20.960 --> 0:09:24.440 they've changed it all up here. Most importantly, he's one 0:09:24.480 --> 0:09:27.640 of the top pharmaceutical and biotech analysts a city of London, 0:09:28.440 --> 0:09:31.120 and we got him at Bloomberg Intelligence and Bordeaux, France 0:09:31.200 --> 0:09:34.120 and Bordeaux friends exactly. I mean, you know again, I'm 0:09:34.160 --> 0:09:36.319 waiting for the invite for us to go over there, 0:09:36.360 --> 0:09:36.800 and I. 0:09:36.720 --> 0:09:37.280 Got a picture. 0:09:37.760 --> 0:09:38.280 You got pictures? 0:09:38.320 --> 0:09:40.560 Yeah, I got a picture from Friday. Okay, it's an 0:09:40.559 --> 0:09:41.839 old pick, but still it was something. 0:09:42.080 --> 0:09:44.120 Yeah, he's got like a horse farm there or something. 0:09:44.440 --> 0:09:46.440 I don't know whatever. Sam's just really cool, Okay, and 0:09:46.480 --> 0:09:47.439 we just totally love him. 0:09:48.880 --> 0:09:52.760 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:09:52.840 --> 0:09:55.920 weekdays at ten am Eastern on Apple card Play and 0:09:55.920 --> 0:09:59.160 Android Auto with the Bloomberg Business. You can also listen 0:09:59.280 --> 0:10:02.400 live on was on Alexa from our flagship New York station, 0:10:02.760 --> 0:10:05.120 Just say Alexa playing Bloomberg eleven. 0:10:06.640 --> 0:10:07.880 Let's go to Tesla. 0:10:08.360 --> 0:10:11.079 The stock's pretty much unchanged today. It's down about ten 0:10:11.120 --> 0:10:14.120 percent year to date. It's flat over trailing twelve months. 0:10:14.920 --> 0:10:17.880 Looks like the EU is looking to slap some terraffs 0:10:18.240 --> 0:10:20.880 on some of these Tesla vehicles that are coming that 0:10:20.880 --> 0:10:22.479 are made in China. 0:10:22.840 --> 0:10:24.640 Is this a big deal? The market doesn't seem to 0:10:24.640 --> 0:10:26.199 think so. The stock's not doing a whole lot. 0:10:26.200 --> 0:10:26.360 Here. 0:10:26.360 --> 0:10:29.559 Craig Trudell joins US Global Autos editor for Bloomberg News, 0:10:29.640 --> 0:10:31.760 joining us from London via zoom. 0:10:31.880 --> 0:10:34.160 Craig, what's the latest coming out of the EU. 0:10:34.200 --> 0:10:34.320 Here? 0:10:34.360 --> 0:10:36.400 As it relates to Tesla. 0:10:36.520 --> 0:10:39.640 Yeah, this is a case of Tesla having a bit 0:10:39.679 --> 0:10:44.320 of a special situation where other manufacturers are subject to 0:10:44.520 --> 0:10:48.719 terraffs on the basis and part of whether or not 0:10:48.800 --> 0:10:51.720 they cooperated with the EU's investigation of just how much 0:10:51.760 --> 0:10:56.400 they were subsidized by the Chinese government. And what the 0:10:56.440 --> 0:10:59.559 EU did here was they sampled a few companies and 0:11:00.040 --> 0:11:02.000 sort of, you know, took a specific look at a 0:11:02.000 --> 0:11:05.560 few manufacturers and made decisions based on what they found 0:11:05.679 --> 0:11:08.960 and on whether or not those companies complied with those investigations. 0:11:09.480 --> 0:11:12.840 And you know, some separate rates were going to be 0:11:12.920 --> 0:11:17.120 applied to companies that were not sampled. What Tesla did 0:11:17.320 --> 0:11:21.280 was go to Brussels and say, look, we don't think 0:11:21.320 --> 0:11:23.480 that we were subsidized as much as some of the 0:11:23.480 --> 0:11:27.240 other guys, so subject us to a lower duty rate. 0:11:27.280 --> 0:11:29.600 And that's what happened here. So they're subject to a 0:11:29.679 --> 0:11:34.120 nine percent tariff byd on the other hand, an additional 0:11:34.200 --> 0:11:37.360 seventeen percent. All of these rates are on top of 0:11:37.400 --> 0:11:40.920 the existing ten percent that cars coming in from China 0:11:40.960 --> 0:11:44.320 face when they are shipped into the EU. And so 0:11:44.600 --> 0:11:46.880 I guess, you know, if I'm an investor, I sort 0:11:46.920 --> 0:11:50.320 of knew that this was coming, had a sense that Tesla, 0:11:50.520 --> 0:11:54.200 you know, there was a potential for you know, a 0:11:54.240 --> 0:11:57.120 slightly more lenient treatment. But in the end, am I 0:11:57.160 --> 0:12:01.560 happy about Model three is being subject to nineteen duties 0:12:02.000 --> 0:12:03.160 you know coming in from Shanghai? 0:12:03.240 --> 0:12:03.760 Probably not. 0:12:04.920 --> 0:12:07.800 Does this mean that Elon Musk will want to manufacture 0:12:07.920 --> 0:12:10.840 more Tesla's in Germany then? Or is he just going 0:12:10.880 --> 0:12:11.480 to cut bait? 0:12:12.840 --> 0:12:15.440 I think it's a really interesting question. I mean, the 0:12:15.440 --> 0:12:18.760 model why is far and away, you know, the model 0:12:19.040 --> 0:12:23.400 for Tesla globally, and I think increasingly so. Even as 0:12:23.480 --> 0:12:25.640 as the company has you know, given a little bit 0:12:25.640 --> 0:12:29.080 of a facelift to the Model three, the why is 0:12:29.120 --> 0:12:31.480 really you know, the volume play for them, and they 0:12:31.520 --> 0:12:35.080 make those in Germany. It wouldn't be a cinch to 0:12:35.200 --> 0:12:38.120 add Model three to the to the plant in Germany. 0:12:38.160 --> 0:12:40.480 But you know, does it does it make a lot 0:12:40.520 --> 0:12:44.400 more sense to build that vehicle there as opposed to 0:12:44.400 --> 0:12:47.760 shipping it in from China. It may, you know, be 0:12:47.880 --> 0:12:50.880 in their best interest to do so. The nineteen percent 0:12:51.520 --> 0:12:55.160 duty is substantial enough to where it certainly has to 0:12:55.200 --> 0:12:58.320 make the math much more interesting in terms of whether 0:12:58.400 --> 0:12:59.960 or not they decide to pull that trigger. 0:13:01.000 --> 0:13:04.400 So from the EU's perspective here, is this a Tesla 0:13:04.559 --> 0:13:07.480 issue or is this just a China issue because I 0:13:07.520 --> 0:13:10.600 know they've got tarifs on other Chinese manufacturers as well. 0:13:11.720 --> 0:13:11.960 Yeah. 0:13:12.240 --> 0:13:14.800 I think the reason that that you know, Tesla is 0:13:14.840 --> 0:13:16.760 sort of being led with today and how this is 0:13:16.800 --> 0:13:20.000 getting covered is is Tesla, you know, was was sort 0:13:20.040 --> 0:13:23.840 of separate from everybody else looking to be assessed on 0:13:23.880 --> 0:13:24.280 its own. 0:13:24.800 --> 0:13:25.000 Uh. 0:13:25.240 --> 0:13:28.880 Whereas all the other manufacturers, uh, you know, the duty 0:13:28.960 --> 0:13:31.720 rates were known, Tesla was was still a little bit 0:13:31.720 --> 0:13:34.000 of a mystery. So this is you know, sort of 0:13:34.080 --> 0:13:36.640 one one more sort of checked box in terms of, 0:13:36.679 --> 0:13:39.040 you know, what the particulars are going to be for 0:13:39.200 --> 0:13:41.640 these duties that go into effect later this year. And 0:13:41.840 --> 0:13:43.560 you know, I think this is very sort of par 0:13:43.679 --> 0:13:46.199 for the course for anything that gets you know, decided 0:13:46.200 --> 0:13:49.360 by the European Commission. Uh, it gets decided over and 0:13:49.400 --> 0:13:51.640 over and over again. And so this is very much 0:13:52.080 --> 0:13:55.520 a broader China story. Uh. And and not Tesla specific. 0:13:55.880 --> 0:13:58.839 Did Tesla evs that are manufactured in China even make 0:13:58.880 --> 0:14:01.080 it into the EU and that point into the US 0:14:01.200 --> 0:14:01.360 or no? 0:14:02.760 --> 0:14:06.520 Yeah, the model all the Model three's that that are 0:14:06.559 --> 0:14:09.199 sold in Europe are coming from Shanghai at the moment, 0:14:09.280 --> 0:14:12.240 and uh, you know, so whether or not the company 0:14:12.280 --> 0:14:16.920 maybe uh perhaps they would potentially look at, you know, 0:14:17.000 --> 0:14:19.600 exporting from the US. I don't think we have a 0:14:19.640 --> 0:14:22.760 good enough sense of, you know, the particulars of their 0:14:22.800 --> 0:14:25.440 cost base to really sort of you know, be able 0:14:25.480 --> 0:14:27.760 to say what makes the most sense for them, uh, 0:14:28.000 --> 0:14:30.920 you know, sort of immediately as a result of this 0:14:31.000 --> 0:14:33.480 change in tariffs that will go into place. But it 0:14:34.000 --> 0:14:37.120 has been interesting that we have seen the company, even 0:14:37.200 --> 0:14:40.840 before these tariffs actually take effect, bump up their prices 0:14:40.840 --> 0:14:43.200 in Europe a little bit, and you've maybe seen that 0:14:43.320 --> 0:14:46.560 result in in some some challenges for them sales wise, 0:14:46.600 --> 0:14:50.000 where they've not had a very good start to the year, 0:14:50.040 --> 0:14:53.280 and that's even carried in into the second half where 0:14:53.360 --> 0:14:56.160 you know, the initial sales results that we've seen for 0:14:56.240 --> 0:14:59.280 Tesla have not been particularly good. I think the fact 0:14:59.280 --> 0:15:02.280 that they've not and able to continue to bring prices 0:15:02.320 --> 0:15:05.960 down and have sort of you know, been unsure whether 0:15:06.080 --> 0:15:08.680 or not all of the model threes that they're they're 0:15:08.760 --> 0:15:13.280 shipping into into the EU from China maybe subject to 0:15:13.320 --> 0:15:17.600 these tariffs. It has been absolutely a headwind. 0:15:17.200 --> 0:15:19.400 For them all right, Greig, thanks so much for joining us. 0:15:19.440 --> 0:15:20.040 Really appreciate it. 0:15:20.080 --> 0:15:22.960 Craig Trudell, a Global autos editor for Bloomberg News, joining 0:15:23.040 --> 0:15:26.040 us from London Q headquarters. 0:15:26.080 --> 0:15:29.880 There in London, you're listening. 0:15:29.480 --> 0:15:33.440 To the Bloomberg Intelligence Podcast. Catch us live weekdays at 0:15:33.440 --> 0:15:36.280 ten am Eastern on Focarplay and then brout Auto with 0:15:36.320 --> 0:15:39.360 the Bloomberg Business app. Listen on demand wherever you get 0:15:39.400 --> 0:15:42.880 your podcasts, or watch us live on YouTube. 0:15:44.160 --> 0:15:47.480 Well, Alex you alongside Paul Sweeney, is a Bloomberg Intelligence Radio. 0:15:47.480 --> 0:15:50.320 We are broadcasting to live from Interactive Broker Studio right 0:15:50.360 --> 0:15:53.320 here in New York City. You can also check us 0:15:53.320 --> 0:15:56.240 out on YouTube as well. So back to the markets. Yeah, 0:15:56.240 --> 0:15:59.240 I appreciate nothing's really happening in the broader equity market. 0:15:59.240 --> 0:16:01.680 You are seeing little bit buying coming into the bond market, 0:16:01.720 --> 0:16:04.000 particularly in the front end. We all look towards Jackson Hole. 0:16:04.120 --> 0:16:06.920 I'm really into that revision of the labor data that 0:16:06.960 --> 0:16:09.040 we're going to get tomorrow. Is the FED going to 0:16:09.080 --> 0:16:11.640 be particularly behind the curb, But we wanted to get 0:16:11.640 --> 0:16:13.360 a professional to weigh in on all of this, and 0:16:13.440 --> 0:16:16.440 Dryden Pence is Chief Investment Officer at Pence Wealth Management 0:16:16.800 --> 0:16:19.280 and he joined us now in the studio Dryden. 0:16:19.320 --> 0:16:20.800 What do you think, what do you think we're going 0:16:20.880 --> 0:16:21.920 to learn this week. 0:16:22.320 --> 0:16:23.760 I think we're going to learn this week that the 0:16:23.840 --> 0:16:28.440 much predicted, you know, September rate cut is on the table, 0:16:29.080 --> 0:16:32.560 that labor data is probably going to be revised a 0:16:32.600 --> 0:16:34.440 little bit. I think people forgot that a lot of 0:16:34.440 --> 0:16:37.080 the labor data was affected by weather, and so you 0:16:37.160 --> 0:16:39.440 had people that were temporary or layoffs or things like that, 0:16:39.480 --> 0:16:41.840 so you get these anomalies that are when we've all 0:16:41.920 --> 0:16:45.080 witnessed weather here lately in New York City, so those 0:16:45.120 --> 0:16:46.720 things have caused it to. 0:16:46.760 --> 0:16:47.400 Change a little bit. 0:16:47.440 --> 0:16:49.720 I think we'll find September's on the table. I think 0:16:49.720 --> 0:16:53.320 that we'll find that the economy is still robust and 0:16:53.400 --> 0:16:56.080 not as I mean, while it's slowing, it's not slowing 0:16:56.080 --> 0:16:57.800 to the level that others were talking about. So I 0:16:57.840 --> 0:17:01.160 think we're going to find a benign move to a 0:17:01.240 --> 0:17:04.199 quarter cut in September, and then we're data dependent to 0:17:04.200 --> 0:17:05.440 see what happens in December. 0:17:06.280 --> 0:17:08.399 We're just finishing up I guess this week kind of 0:17:08.440 --> 0:17:10.680 earnings here. We've got some retailers coming in as well 0:17:10.680 --> 0:17:13.240 as in Nvidia coming up to kind of put a 0:17:13.240 --> 0:17:15.720 punctuation mark on it next next week, What did you 0:17:15.720 --> 0:17:17.240 make of the earnings season we just had. 0:17:17.400 --> 0:17:18.920 I think it's been a robust earning season. 0:17:18.960 --> 0:17:20.479 I mean, the point of the matter is is is 0:17:20.520 --> 0:17:22.800 you know, you had this growth scare that freaked everybody 0:17:22.840 --> 0:17:24.440 out a couple weeks ago. But I mean the point 0:17:24.480 --> 0:17:27.840 of matter is is that we're seeing the broadening out 0:17:28.119 --> 0:17:31.480 of earnings. The earning situation is that we've you know, 0:17:31.520 --> 0:17:35.600 earning recessions, you know, rolling recessions turned into rolling recoveries, 0:17:35.640 --> 0:17:37.359 and so you're seeing the earnings of the rest of 0:17:37.359 --> 0:17:39.160 the four ninety three of the S and P five 0:17:39.240 --> 0:17:42.760 hundred begin to move forward and come out. You're seeing 0:17:42.800 --> 0:17:45.879 about seven eight percent to thirteen percent earnings growth there, 0:17:46.040 --> 0:17:48.720 and that bodes well for the whole broader part of 0:17:48.760 --> 0:17:52.360 the market. So we're moving from magnificent seven, where Nvidia 0:17:52.359 --> 0:17:55.240 accounts for all the earnings growth, to the rest of 0:17:55.280 --> 0:17:58.159 the market moving forward. So that does one of two things. 0:17:58.440 --> 0:18:00.760 It either puts a floor on it by making it 0:18:00.840 --> 0:18:05.480 stronger and stable, or it moves the market forward as 0:18:05.520 --> 0:18:07.080 we go through the rest of the. 0:18:07.080 --> 0:18:10.399 Year, but only for those that actually had that earnings growth, 0:18:10.400 --> 0:18:13.200 So where did you see it? For example, like Bank 0:18:13.240 --> 0:18:16.120 of America's had all their clients bought everything last week except. 0:18:15.800 --> 0:18:18.160 For energy and industrials, Like, where do you see that growth? 0:18:18.160 --> 0:18:18.679 Where do you not? 0:18:19.359 --> 0:18:19.479 Well? 0:18:19.560 --> 0:18:22.920 I think the issue is I begin to see as 0:18:22.960 --> 0:18:25.320 we look at this later part of the cycle, we're 0:18:25.320 --> 0:18:28.159 going to see industrials begin to do better. And we 0:18:28.680 --> 0:18:31.520 think we're going to see industrials and small caps, and 0:18:31.560 --> 0:18:34.600 you're beginning to see pieces of that. I mean, most 0:18:34.680 --> 0:18:37.679 companies are beating their earnings growth estimates. As that's all 0:18:37.720 --> 0:18:39.679 come out, we're almost all the way through earning the season. 0:18:39.840 --> 0:18:42.680 But I think as you get into late third quarter 0:18:42.720 --> 0:18:44.760 and fourth quarters, we're moving through this and you're going 0:18:44.800 --> 0:18:48.000 to see companies begin to publish and begin to show 0:18:48.480 --> 0:18:50.520