1 00:00:02,920 --> 00:00:10,840 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,840 --> 00:00:15,000 Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am 3 00:00:15,040 --> 00:00:18,760 Speaker 1: Eastern on Applecarplaying and Broud Auto with the Bloomberg Business App. 4 00:00:18,800 --> 00:00:22,000 Speaker 1: Listen on demand wherever you get your podcasts, or watch 5 00:00:22,040 --> 00:00:24,000 Speaker 1: us live on YouTube. 6 00:00:24,960 --> 00:00:27,000 Speaker 2: You're live here on a Bloomberg Interactive Broker Studio. 7 00:00:27,040 --> 00:00:29,760 Speaker 3: We're streaming live on YouTube as well, so you can 8 00:00:29,840 --> 00:00:32,120 Speaker 3: head over to YouTube dot com and search Bloomberg Podcast. 9 00:00:32,520 --> 00:00:35,760 Speaker 3: As Amy was just reporting Apple moving higher, it's now 10 00:00:35,920 --> 00:00:39,760 Speaker 3: intra day all time record. Good for them. It's taken 11 00:00:39,800 --> 00:00:42,960 Speaker 3: the lead over in Nvidia as the second most valuable 12 00:00:43,040 --> 00:00:46,519 Speaker 3: company in the world while also reclaiming the three trillion 13 00:00:46,560 --> 00:00:47,839 Speaker 3: dollar market cap valuation. 14 00:00:48,000 --> 00:00:49,519 Speaker 2: So big day for. 15 00:00:49,880 --> 00:00:53,400 Speaker 3: Apple stocks shareholders. Good news for them. Let's break it 16 00:00:53,440 --> 00:00:56,440 Speaker 3: down a little bit here. Angelo Zeno joins US vice 17 00:00:56,480 --> 00:00:59,640 Speaker 3: president and senior equity analyst at c FR A Research 18 00:00:59,680 --> 00:01:03,280 Speaker 3: journey US from Nueva York via zoom Angel. 19 00:01:03,320 --> 00:01:04,560 Speaker 2: Thanks so much for joining us here. 20 00:01:05,160 --> 00:01:08,200 Speaker 3: How did you take How did you interpret yesterday's news 21 00:01:08,280 --> 00:01:11,520 Speaker 3: from Apple? How big of a deal or not was 22 00:01:11,600 --> 00:01:12,360 Speaker 3: their announcements? 23 00:01:13,880 --> 00:01:14,119 Speaker 1: Yeah? 24 00:01:14,160 --> 00:01:15,840 Speaker 4: I mean thanks for having me, guys, So you know, 25 00:01:15,880 --> 00:01:18,160 Speaker 4: as far as you know how a good deal it is, 26 00:01:18,480 --> 00:01:20,399 Speaker 4: we think it's a big deal to us. You know, 27 00:01:21,040 --> 00:01:24,959 Speaker 4: Siri probably just got its biggest upgrade ever since it's 28 00:01:25,280 --> 00:01:28,880 Speaker 4: you know, original kind of appearance back in twenty eleven. 29 00:01:29,280 --> 00:01:31,160 Speaker 4: And you kind of look at what they've done across 30 00:01:31,200 --> 00:01:33,560 Speaker 4: the ecosystem and the new you know, the new AI 31 00:01:33,640 --> 00:01:36,920 Speaker 4: capabilities and tools that they're going to push out to developers. Now, 32 00:01:37,640 --> 00:01:39,480 Speaker 4: there's going to be a lot that they can do 33 00:01:40,440 --> 00:01:43,360 Speaker 4: with these tools, and you know, in terms of upgrading 34 00:01:43,360 --> 00:01:45,840 Speaker 4: their apps and providing new capabilities out there to the 35 00:01:45,840 --> 00:01:49,440 Speaker 4: consumer may not necessarily be something you see over the 36 00:01:49,480 --> 00:01:52,160 Speaker 4: next kind of three to six months, may take you know, 37 00:01:52,240 --> 00:01:54,640 Speaker 4: may take some time here. That's why we told investors 38 00:01:54,640 --> 00:01:57,240 Speaker 4: out there this is going to be more evolutionary than 39 00:01:57,280 --> 00:01:59,559 Speaker 4: it is some sort of super cycle that you're going 40 00:01:59,600 --> 00:02:02,200 Speaker 4: to see later this year. But that said, I mean, 41 00:02:02,680 --> 00:02:05,080 Speaker 4: I think what's really important here is you kind of 42 00:02:05,120 --> 00:02:08,919 Speaker 4: look at most consumers out there today. Most consumers aren't 43 00:02:09,040 --> 00:02:12,959 Speaker 4: using kind of AI in the sense of chat, GPT 44 00:02:13,400 --> 00:02:17,000 Speaker 4: among other type of you know, large language models out 45 00:02:17,000 --> 00:02:19,880 Speaker 4: there to the extent that they possibly can. And when 46 00:02:19,880 --> 00:02:22,320 Speaker 4: you kind of think about what Apple is doing is 47 00:02:22,320 --> 00:02:27,320 Speaker 4: they're probably they're throwing that kind of you know, ability 48 00:02:27,320 --> 00:02:29,560 Speaker 4: out there for consumers to have it directly in their hands. 49 00:02:29,560 --> 00:02:31,680 Speaker 4: So we think that's a big deal, and we think 50 00:02:31,720 --> 00:02:34,960 Speaker 4: that's going to cause consumers out there to ultimately upgrade. 51 00:02:35,160 --> 00:02:37,239 Speaker 4: May not be the sixteen, it might be the seventeen, 52 00:02:37,480 --> 00:02:41,280 Speaker 4: but ultimately it's a very positive thing for the evolution 53 00:02:41,520 --> 00:02:42,000 Speaker 4: of Apple. 54 00:02:42,520 --> 00:02:46,400 Speaker 5: You maintained a by rating on this stock after yesterday's 55 00:02:46,600 --> 00:02:49,120 Speaker 5: news following the conference, but then also if you look 56 00:02:49,120 --> 00:02:50,840 Speaker 5: at the an R function, I know Paul likes to 57 00:02:50,840 --> 00:02:54,200 Speaker 5: look at this. In the terminal, there's forty buys, fifteen holes, 58 00:02:54,480 --> 00:02:57,040 Speaker 5: five cells. And Paul and I were just chatting about 59 00:02:57,040 --> 00:02:59,680 Speaker 5: how this stock when you're looking at Apple up more 60 00:02:59,680 --> 00:03:02,560 Speaker 5: than two twenty percent, is that April nineteenth low. How 61 00:03:02,639 --> 00:03:05,360 Speaker 5: much more room do you think the shares have to 62 00:03:05,480 --> 00:03:06,000 Speaker 5: run now? 63 00:03:06,960 --> 00:03:09,080 Speaker 4: Yeah, suggest I think I think that's a great point. 64 00:03:09,080 --> 00:03:10,560 Speaker 4: So you kind of look at the move that they 65 00:03:10,560 --> 00:03:13,280 Speaker 4: had going into the announcement here, right, I mean, it's 66 00:03:13,400 --> 00:03:15,800 Speaker 4: a fantastic move though the stock was actually down I 67 00:03:15,800 --> 00:03:18,160 Speaker 4: think about fourteen percent on a year to date basis 68 00:03:18,160 --> 00:03:20,920 Speaker 4: into late April, right, And I think that's kind of 69 00:03:20,919 --> 00:03:25,000 Speaker 4: the story from January to April was, Hey, listen, we've 70 00:03:25,040 --> 00:03:28,680 Speaker 4: got some China issues. Expectations in the second half of 71 00:03:28,680 --> 00:03:31,639 Speaker 4: this year may not be able to be met. Now 72 00:03:31,720 --> 00:03:34,200 Speaker 4: you kind of change the narrative around since kind of 73 00:03:34,240 --> 00:03:37,360 Speaker 4: their earnings were released in early May, as well as 74 00:03:37,400 --> 00:03:40,400 Speaker 4: kind of the developer's conference here to one, whereas, hey, 75 00:03:40,400 --> 00:03:43,320 Speaker 4: those numbers may not be attainable to You know, we've 76 00:03:43,360 --> 00:03:48,320 Speaker 4: gotten now six percent expected growth for the iPhone sixteenth cycle. 77 00:03:48,640 --> 00:03:52,240 Speaker 4: There's probably upside to that number instead of downsides. So 78 00:03:52,560 --> 00:03:56,120 Speaker 4: in argue, the narrative has changed. It's all about whether 79 00:03:56,240 --> 00:03:58,480 Speaker 4: or not or how much upside can we see from 80 00:03:58,520 --> 00:04:01,280 Speaker 4: that iPhone sixteenth cycle. At this point in time, we 81 00:04:01,360 --> 00:04:04,480 Speaker 4: think there's upside to the six plus six percent number, 82 00:04:04,720 --> 00:04:06,880 Speaker 4: probably at least eight to ten percent. It'll all be 83 00:04:06,960 --> 00:04:09,760 Speaker 4: sighted also on whether or not Apples can kind of 84 00:04:09,960 --> 00:04:13,120 Speaker 4: or Apple looks to increase prices in the next cycle. 85 00:04:13,240 --> 00:04:16,000 Speaker 4: That remains to be seen. But in our view, there's 86 00:04:16,120 --> 00:04:19,279 Speaker 4: upside potential that still remains despite the move that we've 87 00:04:19,320 --> 00:04:21,760 Speaker 4: seen here over the last five to six weeks. 88 00:04:21,920 --> 00:04:24,600 Speaker 3: So Angel, I'm out there in the marketplace sporting in 89 00:04:24,760 --> 00:04:26,200 Speaker 3: Apple iPhone eleven. 90 00:04:27,000 --> 00:04:29,719 Speaker 2: So I'm guessing I'm right for the upgrade eleven. Yeah, 91 00:04:29,720 --> 00:04:30,920 Speaker 2: I guess I have a fourteen. 92 00:04:31,120 --> 00:04:33,400 Speaker 5: I guess mine's a few years old. 93 00:04:33,800 --> 00:04:35,520 Speaker 2: Here's this sex. It's ridiculous. 94 00:04:35,720 --> 00:04:37,560 Speaker 3: So Angelo, do you think there can be people like 95 00:04:37,600 --> 00:04:41,760 Speaker 3: me that are gonna take this AI features that will 96 00:04:41,800 --> 00:04:43,720 Speaker 3: be coming out in the in the iPhone sixteen, I 97 00:04:43,720 --> 00:04:45,840 Speaker 3: guess in mid September. Are there gonna be people like 98 00:04:45,920 --> 00:04:47,880 Speaker 3: me that are going to go out and upgrade? Is 99 00:04:47,920 --> 00:04:50,320 Speaker 3: this gonna be a real driver of unit sales? 100 00:04:50,360 --> 00:04:50,680 Speaker 2: Do you think? 101 00:04:51,839 --> 00:04:52,080 Speaker 1: Yeah? 102 00:04:52,120 --> 00:04:54,560 Speaker 4: I mean, listen, I think, well, first off, you know, 103 00:04:54,760 --> 00:04:56,679 Speaker 4: there's not much of a bar to be here because 104 00:04:56,720 --> 00:04:59,200 Speaker 4: the iPhone's fifteen cycle is a down cycle. If you 105 00:04:59,240 --> 00:05:01,640 Speaker 4: actually look at the four teen cycle, it was relative 106 00:05:01,720 --> 00:05:05,080 Speaker 4: relatively flat cycle as well as well. So we've kind 107 00:05:05,080 --> 00:05:07,240 Speaker 4: of had this kind of pause here over the last 108 00:05:07,320 --> 00:05:10,320 Speaker 4: kind of two cycles in terms of on a unit basis, right, 109 00:05:10,360 --> 00:05:12,880 Speaker 4: Whereas the twelve and thirteen really took a lot of 110 00:05:12,960 --> 00:05:15,760 Speaker 4: kind of upside there because of some of the you know, 111 00:05:15,800 --> 00:05:18,520 Speaker 4: the China market share gains because of the five G cycle, 112 00:05:18,680 --> 00:05:20,800 Speaker 4: upgrade cycle and what have you. So as we kind 113 00:05:20,800 --> 00:05:24,400 Speaker 4: of now here look here into the sixteen cycle, I 114 00:05:24,440 --> 00:05:27,000 Speaker 4: think a number of things here, as far as kind 115 00:05:27,000 --> 00:05:30,320 Speaker 4: of the fact that the iPhone twelve was that that 116 00:05:30,400 --> 00:05:33,599 Speaker 4: last big upcycle. You're now looking at four years past that. 117 00:05:33,680 --> 00:05:36,680 Speaker 4: So a lot of the twelve consumers out there are 118 00:05:36,680 --> 00:05:39,760 Speaker 4: going to potentially look to upgrade. But for someone like 119 00:05:39,800 --> 00:05:42,719 Speaker 4: you or even someone like myself that haven't upgraded in years, 120 00:05:43,200 --> 00:05:45,760 Speaker 4: this is I mean, forget about the AI capability. 121 00:05:45,760 --> 00:05:46,760 Speaker 6: It's just the camera. 122 00:05:46,520 --> 00:05:50,000 Speaker 4: Capabilities that we've seen since the iPhone eleven. It should 123 00:05:50,120 --> 00:05:52,440 Speaker 4: kind of you're going to see some notable enhancements, but 124 00:05:52,640 --> 00:05:55,040 Speaker 4: I do think kind of that the new AI capabilities 125 00:05:55,080 --> 00:05:59,560 Speaker 4: out there will drive some of those older consumers to upgrade. 126 00:05:59,560 --> 00:06:02,600 Speaker 4: I think all so listen, this is these AI capabilities 127 00:06:02,600 --> 00:06:05,880 Speaker 4: don't work on anything kind of outside of the fifteen 128 00:06:06,400 --> 00:06:09,440 Speaker 4: uh pro devices kind of, so so you can even 129 00:06:09,480 --> 00:06:13,239 Speaker 4: potentially see some you know, iPhone thirteen users or fourteen 130 00:06:13,360 --> 00:06:15,599 Speaker 4: users out there look to upgrade as well. 131 00:06:15,920 --> 00:06:18,839 Speaker 5: Talk to us more about when we're saying AI capabilities, 132 00:06:18,880 --> 00:06:21,440 Speaker 5: what exactly are we going to be able to use 133 00:06:21,800 --> 00:06:24,480 Speaker 5: on those devices that's going to be different from before. 134 00:06:25,800 --> 00:06:28,240 Speaker 4: Yeah, I mean listen, I think most of it is 135 00:06:28,279 --> 00:06:31,119 Speaker 4: pretty basic in nature versus kind of what we've seen 136 00:06:31,200 --> 00:06:34,200 Speaker 4: thus far, and some of the announcements we've seen right 137 00:06:34,279 --> 00:06:38,159 Speaker 4: in terms of what Samsung has announced at the S 138 00:06:38,240 --> 00:06:42,520 Speaker 4: twenty four, what we've seen Alphabet with the Google Pixel. 139 00:06:42,160 --> 00:06:42,719 Speaker 5: And what have you. 140 00:06:42,800 --> 00:06:46,800 Speaker 4: But you know, clearly Theories getting its upgrade is the 141 00:06:46,800 --> 00:06:50,280 Speaker 4: big thing out there. You know, embedding chat GP functionality 142 00:06:50,960 --> 00:06:52,960 Speaker 4: in there as well as a big deal. But you know, 143 00:06:53,000 --> 00:06:58,520 Speaker 4: they showcase capabilities, rewrite, summarization, gen Moji might be a 144 00:06:58,560 --> 00:07:00,880 Speaker 4: cool thing with you know, some of the the younger 145 00:07:01,000 --> 00:07:04,479 Speaker 4: users out there. They showed some you know, cool stuff 146 00:07:04,520 --> 00:07:07,240 Speaker 4: on the photo side of things. So they're going to 147 00:07:07,320 --> 00:07:10,880 Speaker 4: be incremental additions in terms of AI across their ecosystem 148 00:07:10,880 --> 00:07:12,240 Speaker 4: that you're going to be able to kind of use 149 00:07:12,280 --> 00:07:16,640 Speaker 4: and just ultimately kind of make yourself just more efficient 150 00:07:16,720 --> 00:07:18,400 Speaker 4: in nature. I mean, if there was something in an 151 00:07:18,400 --> 00:07:21,280 Speaker 4: email that you had forgotten to put in your calendar, 152 00:07:21,400 --> 00:07:23,200 Speaker 4: that's something that kind of theory is going to be 153 00:07:23,240 --> 00:07:25,200 Speaker 4: able to help you with, whereas you do no longer 154 00:07:25,240 --> 00:07:26,840 Speaker 4: have to kind of go back and search that in 155 00:07:26,920 --> 00:07:29,800 Speaker 4: your email box. So a lot of kind of small 156 00:07:30,720 --> 00:07:33,440 Speaker 4: useful information. We'll see how how well this works once 157 00:07:33,480 --> 00:07:35,800 Speaker 4: it actually comes out and it's exactly in the hands 158 00:07:35,840 --> 00:07:38,920 Speaker 4: of consumers out there. But that said, you know, I 159 00:07:38,920 --> 00:07:40,640 Speaker 4: think a lot of it is incremental. But I think 160 00:07:40,680 --> 00:07:43,680 Speaker 4: the way Apple kind of markets their iPhone devices and 161 00:07:43,760 --> 00:07:46,400 Speaker 4: older devices in general, when you kind of throw the 162 00:07:46,480 --> 00:07:49,600 Speaker 4: Aire storyline on top of it, on top of that, 163 00:07:49,880 --> 00:07:52,200 Speaker 4: I think that's really what kind of is going to 164 00:07:52,240 --> 00:07:54,480 Speaker 4: capture the appeal of a lot of those consumers out there. 165 00:07:54,760 --> 00:07:56,920 Speaker 3: All right, Angela, thank you so much for joining us. 166 00:07:56,920 --> 00:07:59,960 Speaker 3: Angelo Zeno us a vice president and senior equity annals 167 00:08:00,040 --> 00:08:01,960 Speaker 3: at cfr A Research. 168 00:08:02,120 --> 00:08:03,920 Speaker 2: I actually think I will go and get a new iPhone. 169 00:08:03,920 --> 00:08:06,680 Speaker 3: With the new one in September, look at you, and 170 00:08:06,720 --> 00:08:08,520 Speaker 3: I'm not for Ai'm not for the camera, and I 171 00:08:08,680 --> 00:08:09,320 Speaker 3: just I don't know. 172 00:08:10,160 --> 00:08:11,480 Speaker 5: I kind of need a new care. I don't know 173 00:08:11,480 --> 00:08:13,840 Speaker 5: if my mine's a little too fuzzy and granny. However, 174 00:08:13,880 --> 00:08:16,200 Speaker 5: I have dropped my phone many times, so that's not 175 00:08:16,240 --> 00:08:17,520 Speaker 5: Apple's pot that's actually my own. 176 00:08:17,560 --> 00:08:19,600 Speaker 2: Well, my thing is it's all about the battery. 177 00:08:19,600 --> 00:08:22,680 Speaker 3: When the battery starts to die, that's my clue upgrade 178 00:08:22,680 --> 00:08:24,680 Speaker 3: and it has been kind of losing its right. 179 00:08:24,840 --> 00:08:27,160 Speaker 5: I keep having to charge mine multiple times. 180 00:08:27,920 --> 00:08:30,080 Speaker 2: So I think that's kind of the way that's historically 181 00:08:30,080 --> 00:08:30,640 Speaker 2: been so you know. 182 00:08:30,640 --> 00:08:32,800 Speaker 5: What, maybe you and I both will have new phones 183 00:08:32,960 --> 00:08:33,240 Speaker 5: walk over. 184 00:08:33,360 --> 00:08:34,680 Speaker 3: I mean, the good news is we have a huge 185 00:08:34,760 --> 00:08:37,120 Speaker 3: Apple store just you know, right down the block here. 186 00:08:37,400 --> 00:08:38,720 Speaker 2: It's right Fifth Avenue. 187 00:08:38,480 --> 00:08:40,360 Speaker 3: Across from the plaza, across from the plaza, and I 188 00:08:40,360 --> 00:08:43,280 Speaker 3: walk past the pen station every day. Sometimes is going 189 00:08:43,360 --> 00:08:46,000 Speaker 3: there with the other throngs of billions tourists go to 190 00:08:46,040 --> 00:08:46,320 Speaker 3: that show. 191 00:08:46,360 --> 00:08:47,839 Speaker 5: Oh it's it's always packed. 192 00:08:47,840 --> 00:08:50,880 Speaker 2: It's always packed. Crazy. So maybe I'll go there. 193 00:08:50,920 --> 00:08:52,679 Speaker 3: And that's where Tim Cook comes when he comes into 194 00:08:52,720 --> 00:08:54,440 Speaker 3: the city. Does some of his product launches there? 195 00:08:54,480 --> 00:08:57,360 Speaker 5: That's right, that's stock trading above two hundred and two 196 00:08:57,440 --> 00:08:59,880 Speaker 5: dollars right now, still trading at an intra day wreck, 197 00:09:00,200 --> 00:09:01,920 Speaker 5: so clipsing those December all time highs. 198 00:09:01,920 --> 00:09:04,280 Speaker 2: Paul, good good news for our friends in Cooper Tina. 199 00:09:06,800 --> 00:09:10,679 Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live 200 00:09:10,760 --> 00:09:13,800 Speaker 1: weekdays at ten am Eastern on Apple car Play and 201 00:09:13,800 --> 00:09:16,720 Speaker 1: Android Auto with the Bloomberg Business Act. You can also 202 00:09:16,800 --> 00:09:20,280 Speaker 1: listen live on Amazon Alexa from our flagship New York station, 203 00:09:20,640 --> 00:09:25,600 Speaker 1: Just Say Alexa, playing Bloomberg eleven thirty. 204 00:09:25,240 --> 00:09:28,440 Speaker 3: Tomorrow Again, all eyes turned to the Federal Reserve as 205 00:09:28,480 --> 00:09:30,800 Speaker 3: it tends to do from time to time. We have 206 00:09:30,880 --> 00:09:33,200 Speaker 3: the statement coming out of two PM press conference at 207 00:09:33,200 --> 00:09:36,600 Speaker 3: two thirty Michael McKee, Bloomberg's own Michael McKee probably hopping 208 00:09:36,640 --> 00:09:39,319 Speaker 3: on the asella later second and hitting down to DC 209 00:09:39,840 --> 00:09:44,640 Speaker 3: so he can badger FED Chairman Jay Palill in our studio. 210 00:09:44,800 --> 00:09:48,360 Speaker 5: Oh so exciting to suspend the soccer. 211 00:09:48,559 --> 00:09:51,400 Speaker 3: He must have found the Jersey transit train station which 212 00:09:51,400 --> 00:09:54,160 Speaker 3: he lost forgot about for a long time. I hered 213 00:09:54,240 --> 00:09:57,200 Speaker 3: Jersey Chief US interest rate strategies for Bloomberg and College 214 00:09:57,240 --> 00:10:01,679 Speaker 3: studio in studio with the soccer carball suspenders, which just loves. 215 00:10:03,120 --> 00:10:08,200 Speaker 3: I guess tomorrow our expectations should be low for market 216 00:10:08,240 --> 00:10:10,520 Speaker 3: moving news coming from the FED is how we should 217 00:10:10,520 --> 00:10:10,920 Speaker 3: approach it. 218 00:10:11,000 --> 00:10:11,920 Speaker 2: Well, not necessarily. 219 00:10:11,960 --> 00:10:15,000 Speaker 7: You know that there's the possibility that the FED will 220 00:10:15,160 --> 00:10:18,040 Speaker 7: shift its dots not only for this year, but more importantly, 221 00:10:18,360 --> 00:10:20,480 Speaker 7: at least from my perspective, will be the twenty twenty 222 00:10:20,480 --> 00:10:22,960 Speaker 7: five and twenty twenty six dots. So if the FED 223 00:10:22,960 --> 00:10:25,040 Speaker 7: were to move those up because they think that maybe 224 00:10:25,080 --> 00:10:26,839 Speaker 7: the economy is going to be a little bit more robust, 225 00:10:26,880 --> 00:10:29,240 Speaker 7: they won't have to cut interest rates quite as aggressively 226 00:10:29,679 --> 00:10:32,680 Speaker 7: as the prior top plot from the March meeting, then 227 00:10:32,880 --> 00:10:35,400 Speaker 7: the back end of the yield curve in treasuries could 228 00:10:35,400 --> 00:10:37,160 Speaker 7: potentially move quite a bit. 229 00:10:37,600 --> 00:10:38,320 Speaker 2: We don't see. 230 00:10:38,360 --> 00:10:41,440 Speaker 7: Liquidity isn't great right now in the treasury market, so 231 00:10:42,000 --> 00:10:44,600 Speaker 7: you can easily have a ten or fifteenity. 232 00:10:43,920 --> 00:10:45,560 Speaker 3: Great, it's the biggest market of anything. 233 00:10:46,120 --> 00:10:48,240 Speaker 7: Well, but that's the reason, right we've been issuing a 234 00:10:48,240 --> 00:10:52,200 Speaker 7: whole lot of debt and there's only a limited number 235 00:10:52,200 --> 00:10:54,880 Speaker 7: of buyers. So you know, just because you have a 236 00:10:54,880 --> 00:10:57,120 Speaker 7: lot of debt doesn't necessarily mean that there's going to 237 00:10:57,160 --> 00:11:00,160 Speaker 7: be an equal number of buyers out there. So it's 238 00:11:00,200 --> 00:11:02,600 Speaker 7: more it's not that the market's not owned, right that 239 00:11:02,679 --> 00:11:06,000 Speaker 7: So the Treasury Department issues bonds every single almost every 240 00:11:06,000 --> 00:11:09,560 Speaker 7: week now but but basically all the time, and those 241 00:11:09,600 --> 00:11:12,720 Speaker 7: get purchased. Now, the question is in the secondary market, 242 00:11:13,040 --> 00:11:15,480 Speaker 7: how easy it is to sell those bonds into the 243 00:11:15,960 --> 00:11:18,680 Speaker 7: into the market and is there a natural buyer on 244 00:11:18,720 --> 00:11:22,600 Speaker 7: the other side, And the answer is sometimes yes, but 245 00:11:22,600 --> 00:11:24,800 Speaker 7: but occasionally in order to find those buyers, the price 246 00:11:24,840 --> 00:11:28,360 Speaker 7: has to move quite significantly to you know, to entice 247 00:11:28,400 --> 00:11:29,360 Speaker 7: people into the market. 248 00:11:29,600 --> 00:11:32,680 Speaker 5: What do you think bond investors want to hear from 249 00:11:32,720 --> 00:11:35,720 Speaker 5: FED chair pal versus what you think we actually will 250 00:11:35,760 --> 00:11:37,440 Speaker 5: hear in his commentary. 251 00:11:37,640 --> 00:11:40,400 Speaker 7: Well, you know, bond investor, if you're long, you want 252 00:11:40,440 --> 00:11:41,959 Speaker 7: to hear them say that, hey, we're going to cut 253 00:11:41,960 --> 00:11:44,960 Speaker 7: interest rates, you know, starting in July, and and you 254 00:11:45,000 --> 00:11:47,880 Speaker 7: know that that's certainly what what the longs would like 255 00:11:47,920 --> 00:11:50,600 Speaker 7: to see, right, We're not going to hear hear anything 256 00:11:50,720 --> 00:11:53,440 Speaker 7: like that. In fact, we might just hear the opposite. 257 00:11:53,480 --> 00:11:55,319 Speaker 7: And I think that's one of the reasons why the 258 00:11:55,360 --> 00:11:58,240 Speaker 7: people in the treasury market have been pretty cautious. There's 259 00:11:58,360 --> 00:12:01,080 Speaker 7: positioning is now much. You had a lot of people 260 00:12:01,080 --> 00:12:05,520 Speaker 7: who were short. They kind of exited those positions when 261 00:12:05,600 --> 00:12:08,959 Speaker 7: we were actually near current levels or even with the 262 00:12:09,160 --> 00:12:11,199 Speaker 7: yields maybe ten or fifteen base points higher. 263 00:12:11,520 --> 00:12:11,920 Speaker 8: But the. 264 00:12:13,840 --> 00:12:16,120 Speaker 7: Sell off that they think is constrained because it does 265 00:12:16,160 --> 00:12:19,280 Speaker 7: seem like the Fed believes and is trying to convince 266 00:12:19,280 --> 00:12:21,440 Speaker 7: everyone that at some point we're going to cut interest rates. 267 00:12:21,440 --> 00:12:23,360 Speaker 7: So it's going to be hard for sell offs to 268 00:12:23,400 --> 00:12:26,320 Speaker 7: be maintained for a very long period of time. Particularly 269 00:12:26,400 --> 00:12:30,079 Speaker 7: now going back to that supply story, the Treasury Department 270 00:12:30,200 --> 00:12:32,960 Speaker 7: is not issuing more debt than it had been before. 271 00:12:33,040 --> 00:12:36,360 Speaker 7: The issuance pace is basically constant, where as you go 272 00:12:36,440 --> 00:12:40,080 Speaker 7: back six nine months ago, they were continuing to increase 273 00:12:40,120 --> 00:12:42,200 Speaker 7: the amount of debt that they were issuing, and that's 274 00:12:42,200 --> 00:12:43,439 Speaker 7: actually slowed down quite a lot. 275 00:12:43,760 --> 00:12:46,800 Speaker 3: What does a government bond trader do today before a 276 00:12:46,880 --> 00:12:50,920 Speaker 3: FED meeting? Did they make sure they're flat, they're fully hedged? 277 00:12:51,000 --> 00:12:54,320 Speaker 2: Do they know? Did they play their gut and go 278 00:12:54,440 --> 00:12:55,959 Speaker 2: long or short? Here a little bit? What do you 279 00:12:56,040 --> 00:12:56,520 Speaker 2: tip if you do? 280 00:12:56,880 --> 00:12:59,800 Speaker 7: Yeah, I it's a good question. So I've talked to 281 00:12:59,840 --> 00:13:03,200 Speaker 7: some some folks on the cell side, uh in the 282 00:13:03,240 --> 00:13:05,400 Speaker 7: last couple of days, and and a lot of them 283 00:13:05,440 --> 00:13:10,040 Speaker 7: are are dis confused, so they are relatively short or 284 00:13:10,080 --> 00:13:12,680 Speaker 7: relatively flat, I should say. That being said, if you 285 00:13:12,720 --> 00:13:15,080 Speaker 7: look at the positioning data, so the Federal Reserve every 286 00:13:15,120 --> 00:13:17,800 Speaker 7: single week actually pulls the dealers and gets the primary 287 00:13:17,800 --> 00:13:19,800 Speaker 7: dealer positioning data there. 288 00:13:19,840 --> 00:13:21,480 Speaker 2: Are they honest when they're responding to them? 289 00:13:21,520 --> 00:13:25,040 Speaker 7: Well, well they have to be, because if they're audited 290 00:13:25,080 --> 00:13:27,080 Speaker 7: when they're audited annually by the FED, and if they're 291 00:13:27,200 --> 00:13:28,240 Speaker 7: if they don't do their. 292 00:13:28,160 --> 00:13:30,040 Speaker 2: Job there and okay, get in trouble. 293 00:13:31,000 --> 00:13:33,720 Speaker 7: So the but but but dealers in aggregate or as 294 00:13:33,720 --> 00:13:36,720 Speaker 7: long treasuries as they've ever been, it's almost record longs 295 00:13:36,760 --> 00:13:40,480 Speaker 7: in terms of the notional amount outstanding, So so dealers 296 00:13:40,480 --> 00:13:42,560 Speaker 7: are long. But on the other sides, they're also not 297 00:13:42,679 --> 00:13:45,400 Speaker 7: quite record short, but they are. They're hedged a lot 298 00:13:45,440 --> 00:13:47,920 Speaker 7: with futures, so it's like they're long the cash and 299 00:13:47,920 --> 00:13:49,600 Speaker 7: they're short to future. So they're in what we call 300 00:13:49,640 --> 00:13:52,920 Speaker 7: a basis trade where where they're playing some relative value, 301 00:13:52,960 --> 00:13:55,839 Speaker 7: not taking a ton of risk. But but but they 302 00:13:55,840 --> 00:13:58,880 Speaker 7: still have a lot of cash that that they cash, 303 00:13:58,880 --> 00:14:00,439 Speaker 7: securities that they have on their books. 304 00:14:00,520 --> 00:14:03,040 Speaker 5: I track a lot of the big banks and obviously 305 00:14:03,080 --> 00:14:05,520 Speaker 5: their outlooks for when the potential of the first rate 306 00:14:05,800 --> 00:14:07,760 Speaker 5: could happen. So gold min Sacks, for instance, over the 307 00:14:07,800 --> 00:14:09,920 Speaker 5: weekend they still reiterated that they were thinking it was 308 00:14:09,960 --> 00:14:11,680 Speaker 5: going to happen in September, but then they thought a 309 00:14:11,720 --> 00:14:15,040 Speaker 5: second cut would happen in December rather than November. When 310 00:14:15,040 --> 00:14:17,520 Speaker 5: you're looking at the bond market, what is that really 311 00:14:17,559 --> 00:14:19,760 Speaker 5: telling us as far as what the consensus on the 312 00:14:19,760 --> 00:14:22,880 Speaker 5: potential timing is. But because it is an interesting dynamic 313 00:14:22,920 --> 00:14:26,440 Speaker 5: because you have September and then November, actually that interest 314 00:14:26,520 --> 00:14:28,640 Speaker 5: rate decision is the same week as the election, so 315 00:14:28,680 --> 00:14:31,120 Speaker 5: the meeting starts that Wednesday, not that Tuesday. 316 00:14:31,120 --> 00:14:34,760 Speaker 7: They actually moved right to avoid the election. So the 317 00:14:34,800 --> 00:14:37,640 Speaker 7: meeting now the release will be on Thursday, be the 318 00:14:37,680 --> 00:14:40,960 Speaker 7: first time we've had a Thursday US that I can remember, not. 319 00:14:41,080 --> 00:14:42,880 Speaker 5: Quite some time twenty years, so that a lot of 320 00:14:42,920 --> 00:14:44,720 Speaker 5: people have been looking that far ahead to the calendar, 321 00:14:44,720 --> 00:14:46,600 Speaker 5: but I have it circled on my desk, so I 322 00:14:46,680 --> 00:14:49,040 Speaker 5: wanted to ask you your thought process about the timing there. 323 00:14:49,320 --> 00:14:51,920 Speaker 7: So I actually suspect at this point that the Fed, 324 00:14:52,440 --> 00:14:55,560 Speaker 7: you know, unless the CPI data really comes down massively 325 00:14:55,600 --> 00:14:57,440 Speaker 7: and we start to have job losses in the next 326 00:14:57,520 --> 00:15:00,800 Speaker 7: two months, which doesn't seem likely, I doubt that the 327 00:15:00,800 --> 00:15:03,640 Speaker 7: Fed's going to do anything prior to the election. So 328 00:15:03,760 --> 00:15:06,840 Speaker 7: I think September. While it's not a zero percent probability, 329 00:15:06,960 --> 00:15:12,440 Speaker 7: I'll almost never say that, but although tomorrow's zero, well, 330 00:15:12,600 --> 00:15:14,920 Speaker 7: I think that it's very possible that if the FED 331 00:15:15,040 --> 00:15:18,200 Speaker 7: starts to cut rates, it'll be in November or December. 332 00:15:19,040 --> 00:15:21,280 Speaker 7: And there's a growing possibility of my mind that the 333 00:15:21,280 --> 00:15:23,600 Speaker 7: FED might not start cutting rates at all this year. Right, 334 00:15:23,680 --> 00:15:26,200 Speaker 7: it might not cut rates until twenty twenty five, because 335 00:15:26,640 --> 00:15:30,000 Speaker 7: the economy, even though it's slowing, is still reasonably robust, 336 00:15:30,160 --> 00:15:32,280 Speaker 7: and when you look at a lot of the preponderance 337 00:15:32,280 --> 00:15:34,320 Speaker 7: of the data that we look at, particularly the hard 338 00:15:34,400 --> 00:15:37,920 Speaker 7: data like retail sales and even the job market, although 339 00:15:38,000 --> 00:15:41,320 Speaker 7: you know, Anamog and our colleagues at Bloomberg Economics certainly 340 00:15:41,600 --> 00:15:43,160 Speaker 7: see some cracks there as well. 341 00:15:43,360 --> 00:15:46,000 Speaker 5: What is it about September in particular, while you're seeing 342 00:15:46,080 --> 00:15:49,080 Speaker 5: kind of more firms expecting it that month in particular 343 00:15:49,160 --> 00:15:50,120 Speaker 5: versus others. 344 00:15:49,840 --> 00:15:52,440 Speaker 7: Because they're just moving it from July, right, you keep 345 00:15:52,440 --> 00:15:53,000 Speaker 7: pushing it out. 346 00:15:53,200 --> 00:15:53,640 Speaker 8: Yeah, they're just. 347 00:15:53,680 --> 00:15:54,200 Speaker 6: Pushing it out. 348 00:15:55,240 --> 00:15:57,240 Speaker 7: I think that the Fed will still avoid September, even 349 00:15:57,280 --> 00:15:59,360 Speaker 7: though they'll always say that like, we'll do what we 350 00:15:59,440 --> 00:16:02,360 Speaker 7: have to do regardless of the election. This would actually 351 00:16:02,360 --> 00:16:04,800 Speaker 7: be the second closest to an election that they've made 352 00:16:04,800 --> 00:16:07,680 Speaker 7: an initial move. If they were to move in September, 353 00:16:08,600 --> 00:16:12,120 Speaker 7: they basically will say it would say to themselves, you 354 00:16:12,120 --> 00:16:14,960 Speaker 7: know they they'll never say this publicly, but hey, you know, 355 00:16:15,000 --> 00:16:17,640 Speaker 7: why don't we just wait six weeks? You know that realistically, 356 00:16:17,680 --> 00:16:19,840 Speaker 7: we don't have a lot of data, and if the 357 00:16:19,920 --> 00:16:23,960 Speaker 7: data is not absolutely crashing, there's not a there's not 358 00:16:23,960 --> 00:16:26,360 Speaker 7: a fundamental need for us to cut this moment. We 359 00:16:26,360 --> 00:16:28,200 Speaker 7: could just cut a little bit faster later. 360 00:16:28,600 --> 00:16:31,800 Speaker 2: Once they do start cutting, what happens then? 361 00:16:31,840 --> 00:16:33,680 Speaker 3: Did they cut every month there other than the month 362 00:16:33,880 --> 00:16:36,400 Speaker 3: twenty five basis points? Fifty basis points? That does the 363 00:16:36,440 --> 00:16:39,360 Speaker 3: five and a half percent discount rate go to where? 364 00:16:39,440 --> 00:16:39,720 Speaker 1: I don't know. 365 00:16:39,840 --> 00:16:42,560 Speaker 7: Yeah, well it would depend in the economic situation. But 366 00:16:42,640 --> 00:16:43,960 Speaker 7: at the end of the day, I think they would 367 00:16:44,000 --> 00:16:47,520 Speaker 7: like to cut in twenty fives. And certainly that's one 368 00:16:47,520 --> 00:16:49,800 Speaker 7: big reason to look at the twenty twenty five and 369 00:16:49,800 --> 00:16:52,320 Speaker 7: twenty twenty six dots because that'll give you a hint 370 00:16:52,360 --> 00:16:54,920 Speaker 7: test of case. Right, So at this point it looks 371 00:16:54,960 --> 00:16:57,720 Speaker 7: like every other Ish meeting is what they're thinking that 372 00:16:57,720 --> 00:16:58,240 Speaker 7: they'll cut. 373 00:16:58,880 --> 00:17:01,040 Speaker 2: What's a big soccer story in the world. 374 00:17:01,240 --> 00:17:04,040 Speaker 7: Oh, we real Central New Jersey has a home match tomorrow, 375 00:17:04,160 --> 00:17:08,520 Speaker 7: so we have our beer garden getting ready and where Yeah, 376 00:17:08,560 --> 00:17:12,720 Speaker 7: we play at Ryder University. Yeah, in Marsville, New Jersey, 377 00:17:12,880 --> 00:17:15,000 Speaker 7: which is but you know, right in between Princeton and 378 00:17:15,000 --> 00:17:17,000 Speaker 7: Trent And so we get a pretty we've gotten pretty 379 00:17:17,000 --> 00:17:19,200 Speaker 7: good crowds. We actually have record attendance this year, so. 380 00:17:19,160 --> 00:17:20,320 Speaker 2: He pretty excited about it. 381 00:17:20,359 --> 00:17:23,879 Speaker 7: And who do you play tomorrow? We played Lehigh Valley United. 382 00:17:23,600 --> 00:17:26,400 Speaker 2: Rush, which is and where do you get players. 383 00:17:27,200 --> 00:17:30,240 Speaker 7: Almost all of our players are Division one collegiate athletes. 384 00:17:30,280 --> 00:17:33,560 Speaker 2: Okay, Paul, do you want to join in? Might I 385 00:17:33,640 --> 00:17:34,920 Speaker 2: might join in on the beer bash. 386 00:17:35,760 --> 00:17:37,639 Speaker 7: I've been joked around about that, and I'm like, I 387 00:17:37,640 --> 00:17:39,760 Speaker 7: don't want to pull a hamstring like the first fifteen 388 00:17:39,840 --> 00:17:40,760 Speaker 7: seconds I'm on the pitch. 389 00:17:41,320 --> 00:17:44,600 Speaker 3: Anything on the professional level that reach paint. Well. 390 00:17:44,840 --> 00:17:46,720 Speaker 7: You know, one of our local teams here in New 391 00:17:46,800 --> 00:17:49,160 Speaker 7: York is doing really well in Major League Soccer, Soka 392 00:17:49,480 --> 00:17:51,760 Speaker 7: New York Red Bulls is doing great. They got a 393 00:17:51,880 --> 00:17:56,239 Speaker 7: player named Emil Forstburg from from RBI Leipzig and uh 394 00:17:56,359 --> 00:17:59,320 Speaker 7: and and he's been tearing things up along with some homegrowns. 395 00:17:58,840 --> 00:18:01,959 Speaker 2: And then a great stadium, the Red over there in Jersey. 396 00:18:02,000 --> 00:18:03,720 Speaker 3: All right, Ira Jersey, thanks so much for joining us, 397 00:18:03,760 --> 00:18:06,679 Speaker 3: Ira Jersey Chief US Interest Rate Strategic Just Bloomberg Intelligence 398 00:18:07,200 --> 00:18:10,040 Speaker 3: joining us here on our Bloomberg Interactive Broker's studio. 399 00:18:10,960 --> 00:18:14,840 Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live 400 00:18:14,920 --> 00:18:17,639 Speaker 1: weekdays at ten am Eastern on Apple car Playing and 401 00:18:17,760 --> 00:18:20,639 Speaker 1: broud Otto with the Bloomberg Business app. Listen on demand 402 00:18:20,680 --> 00:18:25,000 Speaker 1: wherever you get your podcasts, or watch us live on YouTube. 403 00:18:25,800 --> 00:18:29,600 Speaker 3: Surprising News in the financial markets, and I learned something. 404 00:18:30,280 --> 00:18:31,960 Speaker 3: You need me to look at the gap between the 405 00:18:32,040 --> 00:18:35,520 Speaker 3: ten year French yields and their German counterparts to see 406 00:18:35,600 --> 00:18:37,800 Speaker 3: kind of where the relative risk is in the marketplace, 407 00:18:38,720 --> 00:18:41,240 Speaker 3: and the gap between the ten year French yields and 408 00:18:41,240 --> 00:18:44,520 Speaker 3: their German counterparts climb to the highest this year in 409 00:18:44,560 --> 00:18:48,679 Speaker 3: the wake of Macrone's snap election. I'm not really sure why, 410 00:18:48,720 --> 00:18:50,080 Speaker 3: but we have somebody who does. 411 00:18:50,000 --> 00:18:51,200 Speaker 5: Who can talk to us about this. 412 00:18:51,640 --> 00:18:52,160 Speaker 4: Ashworth. 413 00:18:52,200 --> 00:18:55,200 Speaker 3: He covers all that European stuff with an acerbic wit 414 00:18:55,280 --> 00:18:57,560 Speaker 3: and that I mean that the nicest way. But we 415 00:18:57,640 --> 00:19:00,440 Speaker 3: love talking to Marcus because he spares, you know, note 416 00:19:00,440 --> 00:19:03,600 Speaker 3: bones here, Marcus, what was your reaction to what we 417 00:19:03,640 --> 00:19:06,199 Speaker 3: saw out of the European Union and then the subsequent 418 00:19:07,080 --> 00:19:08,800 Speaker 3: decision by mister Macron? 419 00:19:10,680 --> 00:19:14,159 Speaker 8: Hi, guys, I was thinking that, you know, this was 420 00:19:14,240 --> 00:19:17,560 Speaker 8: a long time coming, but it was worse than perhaps 421 00:19:17,680 --> 00:19:21,919 Speaker 8: everyone including Macrol, had expected, and therefore it put him 422 00:19:21,960 --> 00:19:25,520 Speaker 8: in a very difficult situation with I guess his main 423 00:19:25,560 --> 00:19:31,240 Speaker 8: opera opposition holding more than twice which his party got. 424 00:19:31,359 --> 00:19:33,280 Speaker 6: Then he got like fifteen percent or something. 425 00:19:34,119 --> 00:19:37,240 Speaker 8: So though he had another three years as president, if 426 00:19:37,240 --> 00:19:40,200 Speaker 8: he wants to, I don't think he'll resigned, but there 427 00:19:40,240 --> 00:19:41,159 Speaker 8: was some question about that. 428 00:19:41,200 --> 00:19:43,640 Speaker 6: Today he means he won't. 429 00:19:43,359 --> 00:19:47,080 Speaker 8: Have the ability to a quim of Congress to be 430 00:19:47,160 --> 00:19:48,080 Speaker 8: able to do very much. 431 00:19:48,200 --> 00:19:50,160 Speaker 6: He can still do a lot of. 432 00:19:50,640 --> 00:19:54,320 Speaker 8: Presidential decrees, but nonetheless it's boxed him in, and more 433 00:19:54,320 --> 00:19:57,880 Speaker 8: importantly he can he can't run again. His by then, 434 00:19:58,040 --> 00:19:59,800 Speaker 8: you know, in by twenty twenty seven is ten year 435 00:19:59,840 --> 00:20:02,920 Speaker 8: leg would be pretty poor. So I think what he's 436 00:20:02,960 --> 00:20:10,680 Speaker 8: decided to now is gamble on a political swing which 437 00:20:10,720 --> 00:20:13,119 Speaker 8: has gone to the right wing that perhaps the French 438 00:20:13,160 --> 00:20:15,119 Speaker 8: people they're challenged again may. 439 00:20:15,520 --> 00:20:16,439 Speaker 6: Push back against that. 440 00:20:17,040 --> 00:20:20,359 Speaker 8: But the consequence of this is that the bomb market 441 00:20:20,440 --> 00:20:22,760 Speaker 8: in particular and the stock market and some degree the 442 00:20:22,760 --> 00:20:25,439 Speaker 8: economy is going to have to take a little bit 443 00:20:25,480 --> 00:20:28,560 Speaker 8: of a how can we say this bit of a shakeup, 444 00:20:28,640 --> 00:20:33,199 Speaker 8: because politically this is a very aggressive move and it 445 00:20:33,320 --> 00:20:37,560 Speaker 8: also puts into very much sharp contrast the financial fiscal 446 00:20:37,600 --> 00:20:41,359 Speaker 8: situation of France, which is rising ever an extorably higher 447 00:20:41,400 --> 00:20:45,320 Speaker 8: in debt and particularly it's budget Deficits annual spend is 448 00:20:45,400 --> 00:20:47,040 Speaker 8: much more than it takes in. It's five and a 449 00:20:47,080 --> 00:20:50,800 Speaker 8: half percent last year, which is pretty shocking and not 450 00:20:50,960 --> 00:20:53,080 Speaker 8: likely dropped much by next year, and I think the 451 00:20:53,119 --> 00:20:56,920 Speaker 8: European Union could put it into the double secret probation. 452 00:20:57,040 --> 00:21:00,439 Speaker 8: They call it an emergency deficit procedure. Really what it 453 00:21:00,440 --> 00:21:03,320 Speaker 8: means is that in the sin bin, and that's hugely 454 00:21:03,359 --> 00:21:07,679 Speaker 8: embarrassing for MAC or any government. But the point is 455 00:21:07,720 --> 00:21:10,240 Speaker 8: the rating agency, the credit rating agencies we saw S 456 00:21:10,280 --> 00:21:14,120 Speaker 8: and P at the end of May knock France down 457 00:21:14,160 --> 00:21:18,959 Speaker 8: to double A minus. Fitch are already there, and Moodies 458 00:21:19,000 --> 00:21:21,760 Speaker 8: today came out and basically said they're one notch up 459 00:21:22,160 --> 00:21:23,840 Speaker 8: at double A two, but they may be having a 460 00:21:23,840 --> 00:21:27,080 Speaker 8: look at it. So it's all about a worsting credit 461 00:21:27,119 --> 00:21:30,840 Speaker 8: of France, a worstening political regime, which makes the European 462 00:21:30,920 --> 00:21:33,679 Speaker 8: Union very nervous because you know we've seen with the 463 00:21:33,720 --> 00:21:37,639 Speaker 8: previous situations with Greece and Italy. You know they'll they'll 464 00:21:37,640 --> 00:21:39,720 Speaker 8: turn the blind eye to most things, but they want 465 00:21:39,760 --> 00:21:43,600 Speaker 8: everyone to be very much pro Europe. And Marie la 466 00:21:43,640 --> 00:21:47,760 Speaker 8: Penn's right wing party, which is the National Rally, though 467 00:21:47,760 --> 00:21:51,600 Speaker 8: they no longer argue for Frexit or France exit. 468 00:21:51,400 --> 00:21:53,800 Speaker 6: They once did and then Resa. 469 00:21:53,520 --> 00:21:57,000 Speaker 8: Pretty long in Brussels. So the last thing they want 470 00:21:57,280 --> 00:22:02,800 Speaker 8: is a non fully backing Year style prime minister even 471 00:22:02,880 --> 00:22:05,600 Speaker 8: under Mackrell's president, that will be very out and settling. 472 00:22:05,640 --> 00:22:10,119 Speaker 6: For Brussels, that means us very unsettling. For credit rating agencies, panic, panic, panic. 473 00:22:10,240 --> 00:22:13,360 Speaker 8: It means that French debt is perhaps a little bit 474 00:22:13,359 --> 00:22:15,439 Speaker 8: more risky, still pretty safe, but a little bit more 475 00:22:15,520 --> 00:22:16,040 Speaker 8: risk than it. 476 00:22:16,119 --> 00:22:17,760 Speaker 6: Was before weekend. 477 00:22:18,320 --> 00:22:21,440 Speaker 5: You were talking about how France has seen a sustained 478 00:22:21,440 --> 00:22:24,440 Speaker 5: deterioration its fiscal position, particularly when you're looking at its 479 00:22:24,480 --> 00:22:27,280 Speaker 5: debt looad. How did France get into this position. 480 00:22:29,160 --> 00:22:30,920 Speaker 6: They spend more than they had or. 481 00:22:32,560 --> 00:22:36,080 Speaker 8: The reason is I mean, Macrol was elected on reforming 482 00:22:36,240 --> 00:22:38,840 Speaker 8: the fiscal situation, and principally one of his key things 483 00:22:38,960 --> 00:22:42,440 Speaker 8: was raising the retirement age, which he raised from sort 484 00:22:42,440 --> 00:22:46,040 Speaker 8: of really sixty sixty two up to about sixty four. 485 00:22:46,160 --> 00:22:48,200 Speaker 8: He wanted to get it up to about sixty seven, 486 00:22:48,920 --> 00:22:53,240 Speaker 8: which for instance where the UK is, but massive pushback 487 00:22:53,640 --> 00:22:55,959 Speaker 8: and the fact he very basically couldn't get it through 488 00:22:56,000 --> 00:22:58,520 Speaker 8: unless he pushed it through by this as I mentioned before, 489 00:22:58,520 --> 00:23:02,720 Speaker 8: presidential decree worried some of the raising ainsties. Then now 490 00:23:02,760 --> 00:23:05,240 Speaker 8: the fact that he has gotten really nowhere of getting 491 00:23:05,240 --> 00:23:09,359 Speaker 8: stuff through the National Assembly, the Parliament or Congress is 492 00:23:09,440 --> 00:23:12,840 Speaker 8: a really scary situation. So you know, that means there's 493 00:23:12,880 --> 00:23:18,240 Speaker 8: even less chance of any form of fiscal improvement of 494 00:23:18,280 --> 00:23:22,360 Speaker 8: getting that budget deficit down and reducing the overall debtness 495 00:23:22,359 --> 00:23:26,640 Speaker 8: of France. And that's a pretty difficult situation, complete gridlock. 496 00:23:27,680 --> 00:23:30,800 Speaker 8: Because if the National Rally were to become the person 497 00:23:30,840 --> 00:23:32,520 Speaker 8: the party to have the Prime. 498 00:23:32,320 --> 00:23:34,080 Speaker 6: Minister and try and form some form of. 499 00:23:34,680 --> 00:23:40,119 Speaker 8: Coappitatial cohabitation, I think it's a in English, is that 500 00:23:40,160 --> 00:23:42,159 Speaker 8: they won't get it. They won't allow any form of 501 00:23:43,040 --> 00:23:47,159 Speaker 8: spending cuts or anything to reduce the benefits that a lot. 502 00:23:47,040 --> 00:23:48,000 Speaker 6: Of French people. 503 00:23:48,560 --> 00:23:51,360 Speaker 8: Fifty eight percent of the French economy is state spending. 504 00:23:51,440 --> 00:23:56,040 Speaker 8: It's a very socialist driven state, and they don't like 505 00:23:56,080 --> 00:23:59,240 Speaker 8: their benefits getting touched, which means nothing will happen at 506 00:23:59,320 --> 00:24:03,520 Speaker 8: least twenty twenty, no improvement on the fiscal outlook. That's 507 00:24:03,640 --> 00:24:07,160 Speaker 8: very bad news for bondholders, for credit radio season, indeed 508 00:24:07,200 --> 00:24:09,520 Speaker 8: probably for European Union cohesion. 509 00:24:10,280 --> 00:24:14,399 Speaker 3: So I know in your column, Marcus, perhaps one of 510 00:24:14,400 --> 00:24:17,080 Speaker 3: the rationales for Mark Crohn's boldness here is that will 511 00:24:17,080 --> 00:24:20,239 Speaker 3: actually force Marine la Penn to maybe reveal what her 512 00:24:20,240 --> 00:24:21,440 Speaker 3: plans for the economy are. 513 00:24:21,680 --> 00:24:23,399 Speaker 2: What do we know or what don't we know? 514 00:24:24,200 --> 00:24:26,440 Speaker 8: Well, we they deliberately a bit like the Labor Party 515 00:24:26,480 --> 00:24:28,199 Speaker 8: it's about to take power in the UK. They've been 516 00:24:28,359 --> 00:24:32,520 Speaker 8: very should we say, with shurchet In telling us what 517 00:24:32,560 --> 00:24:36,560 Speaker 8: they are actually going to planning to do, and Marilla 518 00:24:36,560 --> 00:24:39,000 Speaker 8: Penn has basically said no to many things but hasn't 519 00:24:39,040 --> 00:24:42,000 Speaker 8: told anyone really what they're they are planning to do, 520 00:24:42,080 --> 00:24:44,840 Speaker 8: how she would sort the pension situation out. 521 00:24:45,240 --> 00:24:46,199 Speaker 6: But the one thing we know for. 522 00:24:46,280 --> 00:24:49,960 Speaker 8: Sure they are pretty anti immigration and they are pretty 523 00:24:49,960 --> 00:24:54,120 Speaker 8: anti the pension changes in any other form of benefit changes. 524 00:24:54,520 --> 00:24:57,560 Speaker 8: So it's gonna be almost impossible for the government to 525 00:24:57,600 --> 00:25:01,560 Speaker 8: stop its welfare spending bill, and that you can only 526 00:25:01,640 --> 00:25:04,520 Speaker 8: mean you know, essentially this would be a deficit and 527 00:25:04,640 --> 00:25:07,960 Speaker 8: debt to GDP ratio negative scenario. 528 00:25:08,119 --> 00:25:09,600 Speaker 6: I would think it'd be very hard for. 529 00:25:10,119 --> 00:25:12,880 Speaker 8: But you know, Mackerel's gamble is precisely as you laid out, 530 00:25:13,000 --> 00:25:16,040 Speaker 8: is that if they put them in power, at least nominally, 531 00:25:16,240 --> 00:25:18,399 Speaker 8: the Prime Minister doesn't have anything like as much control 532 00:25:18,440 --> 00:25:20,840 Speaker 8: as you would think, but they have ability to. 533 00:25:20,800 --> 00:25:22,000 Speaker 6: Try and put some things through. 534 00:25:22,080 --> 00:25:25,000 Speaker 8: If they turn out to be incompetent and they turn 535 00:25:25,080 --> 00:25:27,000 Speaker 8: out not to do what they said they would go 536 00:25:27,080 --> 00:25:29,879 Speaker 8: to do or anything like this. It would make the 537 00:25:30,240 --> 00:25:33,000 Speaker 8: presdential elections in twenty twenty seven a bit of a 538 00:25:33,040 --> 00:25:37,160 Speaker 8: little bit more anti the National Rally and approach we say 539 00:25:37,240 --> 00:25:39,280 Speaker 8: Mackerels or more of more. 540 00:25:39,160 --> 00:25:41,560 Speaker 6: Centrists the huge gambles. It could go the other way. 541 00:25:41,600 --> 00:25:44,119 Speaker 6: These guys could turn out to be very good in power. 542 00:25:44,119 --> 00:25:46,720 Speaker 8: In fact, the center right are already talking about maybe 543 00:25:47,080 --> 00:25:49,920 Speaker 8: teaming up with the National Rally of the far right 544 00:25:49,960 --> 00:25:54,240 Speaker 8: and creating an anti Macron coalition that can become very popular. 545 00:25:54,320 --> 00:25:57,360 Speaker 8: And we could see it would be a very stupid 546 00:25:57,359 --> 00:26:00,240 Speaker 8: gamble that Macrol's taken. We just don't know the is 547 00:26:00,320 --> 00:26:02,359 Speaker 8: If you're a bondholder, and indeed, as you seem to, 548 00:26:02,440 --> 00:26:06,600 Speaker 8: the French banks like sock Gen got hit really hard yesterday. 549 00:26:06,960 --> 00:26:08,440 Speaker 8: You know, why would you want to take the risk 550 00:26:08,520 --> 00:26:10,440 Speaker 8: and perhaps go to somewhere a little bit more safe 551 00:26:10,480 --> 00:26:12,280 Speaker 8: like Germany or I don't know, somewhere. 552 00:26:12,040 --> 00:26:12,600 Speaker 6: Else in Europe. 553 00:26:12,880 --> 00:26:15,280 Speaker 5: So Mark, as you were just bringing up Shausgen, what 554 00:26:15,520 --> 00:26:18,320 Speaker 5: other parts when you're looking at French equities have been 555 00:26:18,400 --> 00:26:21,000 Speaker 5: hit hardest. We're other ones have been maybe more shielded 556 00:26:21,119 --> 00:26:21,520 Speaker 5: right now? 557 00:26:22,400 --> 00:26:24,159 Speaker 8: Well, yeah, but the banks got hit hard as they 558 00:26:24,200 --> 00:26:27,080 Speaker 8: always tend to. Partly that's because you know a lot 559 00:26:27,080 --> 00:26:30,399 Speaker 8: of international investors, particularly American investors, they're invested in Europe, 560 00:26:30,840 --> 00:26:32,920 Speaker 8: they tend to light the banking sector mores more. 561 00:26:32,800 --> 00:26:33,800 Speaker 6: Banks for the butt. 562 00:26:33,800 --> 00:26:36,880 Speaker 8: They understand and can play that game much more cleanly. 563 00:26:38,200 --> 00:26:40,560 Speaker 8: So you know, you should be really worrying if you 564 00:26:40,560 --> 00:26:43,320 Speaker 8: start seeing things like insurance companies going because that's a 565 00:26:43,359 --> 00:26:47,240 Speaker 8: credit issue. But banks are an easy, easy sell, highly liquid. 566 00:26:48,200 --> 00:26:50,520 Speaker 8: I would expect if if things do calm down and 567 00:26:50,600 --> 00:26:53,439 Speaker 8: the by July seventh, you know, the actual results, they 568 00:26:53,480 --> 00:26:56,200 Speaker 8: aren't perhaps as bad as people expected. I wull think 569 00:26:56,200 --> 00:26:59,159 Speaker 8: the banks would probably therefore do the best. But you know, 570 00:26:59,520 --> 00:27:01,919 Speaker 8: industrial sector in all of Europe is in a pretty 571 00:27:01,920 --> 00:27:05,919 Speaker 8: tough time at the moment. France is world leader in 572 00:27:06,040 --> 00:27:08,920 Speaker 8: luxury goods, so LVMH things like that. 573 00:27:09,840 --> 00:27:12,320 Speaker 6: These are companies keep us post is on. 574 00:27:12,400 --> 00:27:15,920 Speaker 8: But they are right perhaps less suspect to these politics, 575 00:27:15,920 --> 00:27:17,760 Speaker 8: but still not great for anyone. 576 00:27:17,840 --> 00:27:19,600 Speaker 3: All right, very good, Marcus Ashwer, thank you so much. 577 00:27:19,640 --> 00:27:22,960 Speaker 3: We appreciate it, folks. Marcus is a calumnist covering European 578 00:27:23,000 --> 00:27:26,399 Speaker 3: markets for Bloomberg Opinion. Check out his column today. Macrome 579 00:27:26,440 --> 00:27:28,399 Speaker 3: plays fast and loose with investor Faith. 580 00:27:28,840 --> 00:27:31,320 Speaker 2: So very interesting. There. 581 00:27:31,880 --> 00:27:35,760 Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live 582 00:27:35,840 --> 00:27:39,360 Speaker 1: weekdays at ten am Eastern on applecard Play and Android 583 00:27:39,400 --> 00:27:42,560 Speaker 1: Auto with the Bloomberg Business. You can also listen live 584 00:27:42,640 --> 00:27:45,840 Speaker 1: on Amazon Alexa from our flagship New York station, Just 585 00:27:45,880 --> 00:27:50,720 Speaker 1: say Alexa play Bloomberg eleven thirty. 586 00:27:50,280 --> 00:27:52,399 Speaker 2: Just meant sitting in for Alex steel On Paul Sweeney. 587 00:27:52,760 --> 00:27:55,000 Speaker 3: We are broadcasting live from the Bloomberg and Actor Brokers 588 00:27:55,040 --> 00:27:55,480 Speaker 3: studio in. 589 00:27:55,480 --> 00:27:56,080 Speaker 2: New York City. 590 00:27:56,080 --> 00:27:58,560 Speaker 3: We're streaming live on YouTube, So hit over YouTube dot 591 00:27:58,560 --> 00:28:02,040 Speaker 3: com search Bloomberg Podcast and that's where will find us. Well, 592 00:28:02,040 --> 00:28:05,400 Speaker 3: despite the US labor market remaining tight, a new survey 593 00:28:05,880 --> 00:28:09,840 Speaker 3: reveals that the recruitment and retainment challenges facing businesses have 594 00:28:09,960 --> 00:28:11,600 Speaker 3: eased a little bit. So let's break that down with 595 00:28:11,720 --> 00:28:15,280 Speaker 3: Robin Ericson, Vice President and Human Capital for the Conference Board, 596 00:28:15,520 --> 00:28:16,159 Speaker 3: joining us. 597 00:28:16,359 --> 00:28:18,160 Speaker 2: Via zoom from Chicago. 598 00:28:18,440 --> 00:28:20,640 Speaker 3: So Robin talked to us about the labor market out 599 00:28:20,640 --> 00:28:24,280 Speaker 3: there from the employer's perspective, how tough is it to 600 00:28:24,320 --> 00:28:27,040 Speaker 3: attract and retain talent these days? 601 00:28:28,440 --> 00:28:31,679 Speaker 9: Thanks so much for having me today. We did find 602 00:28:31,880 --> 00:28:36,640 Speaker 9: that the challenges of recruiting and retaining employees have eased significantly. 603 00:28:37,840 --> 00:28:41,720 Speaker 9: As you can imagine, during the great resignation of twenty 604 00:28:41,760 --> 00:28:45,080 Speaker 9: one and twenty twenty two, it was very difficult to 605 00:28:45,240 --> 00:28:49,760 Speaker 9: recruit and retain workers. But we did find that while 606 00:28:49,880 --> 00:28:53,120 Speaker 9: finding talent is a challenge for more than fifty five 607 00:28:53,160 --> 00:28:56,520 Speaker 9: percent of respondents, this number has decreased from a high 608 00:28:56,520 --> 00:29:00,280 Speaker 9: of eighty three percent and twenty twenty two. And then 609 00:29:00,320 --> 00:29:04,800 Speaker 9: retaining workers is less challenging because we found that only 610 00:29:04,880 --> 00:29:08,520 Speaker 9: forty one percent of human capital leaders reported difficulty retaining 611 00:29:08,520 --> 00:29:11,680 Speaker 9: workers compared to a high sixty six percent in twenty 612 00:29:11,720 --> 00:29:14,800 Speaker 9: twenty two. So those are big changes. 613 00:29:15,880 --> 00:29:20,560 Speaker 5: Break down what specific industries and job positions are most 614 00:29:20,680 --> 00:29:24,520 Speaker 5: vulnerable right now when you're trying to find qualified workers, 615 00:29:24,560 --> 00:29:26,240 Speaker 5: but they're not there to match that up. 616 00:29:27,360 --> 00:29:32,520 Speaker 9: Yes, So we did look at the workforce in two categories. 617 00:29:32,560 --> 00:29:36,160 Speaker 9: We looked at the workforce of mostly professional and office workers. 618 00:29:36,560 --> 00:29:39,840 Speaker 9: We had about sixty percent of our respondents from that 619 00:29:40,000 --> 00:29:43,520 Speaker 9: industry or those industries. And we also then looked at 620 00:29:43,560 --> 00:29:47,400 Speaker 9: mostly those organizations that had mostly industry and manual service workers, 621 00:29:48,280 --> 00:29:52,479 Speaker 9: and it's definitely more difficult to recruit and retain talent 622 00:29:52,960 --> 00:29:57,200 Speaker 9: in those organizations. With mostly industry and manual service workers. 623 00:29:57,920 --> 00:30:02,320 Speaker 9: If you think about the difficulties that hospitality that the 624 00:30:02,360 --> 00:30:05,440 Speaker 9: hospitality industry is having, especially with you know, hotels and 625 00:30:05,480 --> 00:30:11,719 Speaker 9: restaurants do also have issues trying to find the you know, 626 00:30:12,000 --> 00:30:17,360 Speaker 9: truck drivers remains the more difficult job to recruit for. 627 00:30:18,640 --> 00:30:21,360 Speaker 3: So Robin, I guess one of the big issues that 628 00:30:21,440 --> 00:30:23,719 Speaker 3: everybody's trying to continue to come to groups with is 629 00:30:24,320 --> 00:30:26,680 Speaker 3: where are people working? Is it back in the office 630 00:30:26,840 --> 00:30:28,880 Speaker 3: five days a week, is it hybrid? Is it work 631 00:30:28,880 --> 00:30:31,800 Speaker 3: from home? How is this kind of shaking out, you know, 632 00:30:32,360 --> 00:30:34,200 Speaker 3: several years past the pandemic. 633 00:30:35,160 --> 00:30:40,560 Speaker 9: So obviously with the spike in remote work, there was sorry, 634 00:30:40,640 --> 00:30:43,480 Speaker 9: obviously there was a big spike in remote work during 635 00:30:44,560 --> 00:30:48,560 Speaker 9: the pandemic, and so we actually started with our Reimagined 636 00:30:48,600 --> 00:30:54,680 Speaker 9: Workplace study looking at how many employees or workers were remote, 637 00:30:55,000 --> 00:31:00,600 Speaker 9: how many were hybrid, and how many were fully on site. Interestingly, 638 00:31:01,320 --> 00:31:07,640 Speaker 9: the rate of hybrid workers has remained very similar. And 639 00:31:08,920 --> 00:31:12,080 Speaker 9: so what do I mean by that? It's the in 640 00:31:12,080 --> 00:31:16,000 Speaker 9: our survey, we found that fifty six percent of the 641 00:31:16,320 --> 00:31:20,160 Speaker 9: workers in the organizations that we surveyed are either hybrid 642 00:31:20,320 --> 00:31:23,880 Speaker 9: and remote, so they're either working part time in the 643 00:31:23,920 --> 00:31:27,440 Speaker 9: office and part time at home or they're full time 644 00:31:27,440 --> 00:31:30,440 Speaker 9: at home. That's fifty six percent. That's down from sixty 645 00:31:30,440 --> 00:31:33,640 Speaker 9: one percent, which is a difference of only five percent. 646 00:31:34,440 --> 00:31:38,120 Speaker 9: And the number of workers who are fully on site 647 00:31:38,640 --> 00:31:41,360 Speaker 9: has only risen by five percent since twenty twenty two, 648 00:31:41,440 --> 00:31:45,440 Speaker 9: from thirty nine percent to forty four percent. And we've 649 00:31:45,480 --> 00:31:48,480 Speaker 9: also done some other studies here at the Conference Board 650 00:31:48,600 --> 00:31:53,800 Speaker 9: and have found that flexibility is the number one request 651 00:31:53,920 --> 00:31:59,840 Speaker 9: of employees after a competitive salary. 652 00:32:00,040 --> 00:32:02,840 Speaker 5: Do you find that employers are getting more strict to 653 00:32:02,920 --> 00:32:05,440 Speaker 5: try to get employees back into the office. It was 654 00:32:05,480 --> 00:32:07,880 Speaker 5: interesting hearing some of the stats you were just mentioning, 655 00:32:07,920 --> 00:32:10,200 Speaker 5: because some of that seemed to be like potentially, but 656 00:32:10,240 --> 00:32:12,720 Speaker 5: it still seemed like there still was a good amount 657 00:32:12,720 --> 00:32:15,000 Speaker 5: of people working from home for various reasons. 658 00:32:15,000 --> 00:32:21,000 Speaker 9: Obviously, yes, so in the conference So the Conference Board 659 00:32:21,000 --> 00:32:25,720 Speaker 9: has a flagship survey and in twenty twenty four we 660 00:32:25,840 --> 00:32:31,200 Speaker 9: found that only about four percent of CEOs were concerned 661 00:32:31,240 --> 00:32:35,520 Speaker 9: about mandating returned to the office, so they were much 662 00:32:35,560 --> 00:32:41,000 Speaker 9: more concerned about making hybrid work work for their organizations. Obviously, 663 00:32:41,040 --> 00:32:44,560 Speaker 9: there are some well known organizations that have come out 664 00:32:44,640 --> 00:32:48,320 Speaker 9: mandating returning to the office But one of the other 665 00:32:48,440 --> 00:32:51,840 Speaker 9: interesting things that we found in our study was that 666 00:32:51,880 --> 00:32:57,640 Speaker 9: those organizations that allowed their employees to choose where they 667 00:32:57,720 --> 00:33:05,400 Speaker 9: worked had three times less difficulty retaining workers. So those 668 00:33:05,520 --> 00:33:09,840 Speaker 9: organizations that mandated their workers to go into the office, 669 00:33:10,400 --> 00:33:13,040 Speaker 9: forty five percent of our respondents said it was difficult 670 00:33:13,480 --> 00:33:18,600 Speaker 9: to retain workers. Well, only fifteen percent of those organizations 671 00:33:18,600 --> 00:33:20,920 Speaker 9: that had employed choice about whether or not they went 672 00:33:20,920 --> 00:33:24,000 Speaker 9: into the office said it was difficult to retain workers. 673 00:33:24,360 --> 00:33:28,120 Speaker 9: So clearly there is a business case for hybrid and 674 00:33:28,200 --> 00:33:31,120 Speaker 9: more flexibility and more employee choice where it's possible. 675 00:33:32,200 --> 00:33:32,880 Speaker 2: How about AI. 676 00:33:33,000 --> 00:33:34,960 Speaker 3: A lot of folks will talk about AI in so 677 00:33:35,040 --> 00:33:37,320 Speaker 3: many different parts of this economy and what it means 678 00:33:37,360 --> 00:33:40,760 Speaker 3: for not just economy, but for society as well. One 679 00:33:40,800 --> 00:33:45,000 Speaker 3: of the concerns is what will AI do to kind 680 00:33:45,040 --> 00:33:47,880 Speaker 3: of the workforce? Well, we need fewer workers in different jobs. 681 00:33:48,320 --> 00:33:50,000 Speaker 3: I know that was a big issue, for example, for 682 00:33:50,160 --> 00:33:53,520 Speaker 3: the writer's strike in Hollywood. They want a language in 683 00:33:53,560 --> 00:33:57,360 Speaker 3: their contracts that protected them from AI. Writers and actors 684 00:33:57,560 --> 00:34:02,440 Speaker 3: talk to us about how employers think about AI, So 685 00:34:02,960 --> 00:34:03,760 Speaker 3: we know that. 686 00:34:04,120 --> 00:34:08,440 Speaker 9: The majority of organizations are interested in AI in some fashion. 687 00:34:08,520 --> 00:34:11,799 Speaker 9: They've either adopted it already in their organizations or they're 688 00:34:11,840 --> 00:34:15,680 Speaker 9: planning to adopt it. AI is here to stay and 689 00:34:15,960 --> 00:34:22,680 Speaker 9: organizations can actually be more productive and more efficient with AI. 690 00:34:23,360 --> 00:34:26,600 Speaker 9: To answer your question Paul around whether or not we 691 00:34:26,640 --> 00:34:30,120 Speaker 9: would need fewer employees, I don't know that we will 692 00:34:30,160 --> 00:34:33,920 Speaker 9: need fewer employees, but I definitely think that employees will 693 00:34:33,960 --> 00:34:37,240 Speaker 9: need to have different skills. So one of the things 694 00:34:37,239 --> 00:34:39,799 Speaker 9: in our survey that we found is that the majority 695 00:34:40,120 --> 00:34:44,160 Speaker 9: of surveyed human capital leaders said that they were experimenting 696 00:34:44,640 --> 00:34:49,200 Speaker 9: with AI pilots at not focusing on long term strategies 697 00:34:49,520 --> 00:34:53,880 Speaker 9: like the job displacement that might come from AI, but 698 00:34:54,040 --> 00:34:58,160 Speaker 9: the reskilling for roles that are different. 699 00:35:00,440 --> 00:35:02,840 Speaker 3: Very good, Robin, thank you so much. Really appreciate getting 700 00:35:02,840 --> 00:35:05,080 Speaker 3: your thoughts at Robin Rickson. She's a vice president for 701 00:35:05,120 --> 00:35:09,160 Speaker 3: Human Capital at the Conference Board, joining us from Chicago here. 702 00:35:09,239 --> 00:35:13,719 Speaker 1: This is the Bloomberg Intelligence Podcast, available on apples, Spotify, 703 00:35:13,920 --> 00:35:17,600 Speaker 1: and anywhere else you'll get your podcasts. Listen live each weekday, 704 00:35:17,719 --> 00:35:20,719 Speaker 1: ten am to noon Eastern on Bloomberg dot com, the 705 00:35:20,800 --> 00:35:24,239 Speaker 1: iHeartRadio app, tune In, and the Bloomberg Business app. You 706 00:35:24,280 --> 00:35:27,480 Speaker 1: can also watch us live every weekday on YouTube and 707 00:35:27,640 --> 00:35:29,280 Speaker 1: always on the Bloomberg terminal