WEBVTT - US Employers Add 177,000 Jobs, Solid Pace in Face of Uncertainty 

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news. You're listening to the

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<v Speaker 2>I want to get right to the economic data of

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<v Speaker 2>the day. It is Jobs Day and the change of

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<v Speaker 2>non farm payroll came in one hundred and seventy seven thousand.

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<v Speaker 2>Consensus was one thirty eight, so a beat there. The

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<v Speaker 2>prior period was revised down sharply from two hundred and

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<v Speaker 2>twenty eight thousand to one and eighty five, so some

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<v Speaker 2>cross currents there. Let's break it down. Tom Gimball, Vice

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<v Speaker 2>chairman American Staffing Association and founder of LaSalle Networks. Hey, Tom,

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<v Speaker 2>what do you take away from today's non farm payroll data?

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<v Speaker 3>I think it shows that the US economy is resilient.

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<v Speaker 4>I think that the tariff hubbabaloo for lack of a

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<v Speaker 4>better word, hasn't hit yet.

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<v Speaker 3>Companies didn't know.

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<v Speaker 4>What to do following the announcement the first week in April,

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<v Speaker 4>so we have some time to show up on that.

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<v Speaker 4>And I think the real message is small and medium

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<v Speaker 4>sized businesses always drive the jobs numbers more than anything else,

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<v Speaker 4>and so if big companies do layoffs, small companies can

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<v Speaker 4>now afford to hire some talent they couldn't before, and

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<v Speaker 4>that's where you see a lot.

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<v Speaker 3>Of the hiring.

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<v Speaker 5>So since you run one of the leading staffing and

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<v Speaker 5>recruiting firms in the country, who's staffing and recruiting.

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<v Speaker 3>Well, I think that that.

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<v Speaker 4>The companies that are hiring are small and medium sized companies.

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<v Speaker 3>You're not.

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<v Speaker 4>You know, when you see the announcements that a company

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<v Speaker 4>like Starbucks is doing layoffs or what have you, is

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<v Speaker 4>that you see that big companies have to cut overhead.

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<v Speaker 4>But when you have small companies, you know, the two

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<v Speaker 4>sectors that I see a lot continue to be our

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<v Speaker 4>healthcare and you're going to have techn service firms, and

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<v Speaker 4>service firms are going to continue to be doing consulting work.

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<v Speaker 4>There's technology bases, things along those lines that aren't as

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<v Speaker 4>directly affected by lack of inventory and trade tariffs of

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<v Speaker 4>importing products from other countries.

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<v Speaker 2>Tom some economists are concerned that tariffs and just economic

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<v Speaker 2>uncertainty resulting from tariff discussions could hit small and midsized

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<v Speaker 2>businesses harder because maybe they don't have the same profit

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<v Speaker 2>margins and resources as some of the bigger companies. What

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<v Speaker 2>are your respondents in your surveys telling you.

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<v Speaker 4>I think there's no doubt about that that I'm talking

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<v Speaker 4>to leader CEOs of businesses every week, and there's obviously

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<v Speaker 4>a concern due to the uncertainty of what's going on

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<v Speaker 4>geopolitically and the tariffs. However, at the same time is

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<v Speaker 4>that labor for the most part, can be scaled up

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<v Speaker 4>and scaled down and companies right now have to focus

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<v Speaker 4>on where the opportunities lie. And so what we see

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<v Speaker 4>right now is there is a fear, there is an uncertainty. However,

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<v Speaker 4>there's also companies, small and medium sized companies. Again, I

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<v Speaker 4>want to repeat, if you're a small manufacturing company, you've

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<v Speaker 4>got real challenges. If you're a small distribution company, you've

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<v Speaker 4>got real challenges. But if you're a consulting firm, if

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<v Speaker 4>you're a services business, if you're a technology app development company,

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<v Speaker 4>there's still opportunity because companies have to figure out workarounds

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<v Speaker 4>to the situation, and those are usually going to be

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<v Speaker 4>technologically based solutions.

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<v Speaker 5>To the other side of it, those small, medium sized

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<v Speaker 5>businesses that are geared towards the consumer is selling stuff

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<v Speaker 5>and products and manufacturing, et cetera. Are they laying off

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<v Speaker 5>people or are they just not hiring?

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<v Speaker 4>No, I think you're seeing both. Listen, companies are laying

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<v Speaker 4>off in good economies, companies lay people off. What you

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<v Speaker 4>have is in a situation like this, companies have to

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<v Speaker 4>look at their infrastructure. It's the same thing with unloading

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<v Speaker 4>real estate during the COVID situation. They might not have

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<v Speaker 4>needed it all along, but it gives them an excuse

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<v Speaker 4>to do that. And so, you know, for lack of

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<v Speaker 4>a better phrase, are companies pruning some talent right now?

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<v Speaker 3>They absolutely are.

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<v Speaker 4>And at the same same time, you see that if

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<v Speaker 4>you go and look and search any job board, you're

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<v Speaker 4>going to see that companies are also hiring weeks after

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<v Speaker 4>they do layoffs because they're different skill sets, different positions,

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<v Speaker 4>and so you know, the word hiring freeze is usually

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<v Speaker 4>for new positions, but ones that are deemed to be

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<v Speaker 4>necessary to the business, Companies are always going to be

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<v Speaker 4>hiring in those spots.

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<v Speaker 2>Labor hoarding, that's a term I learned during a pandemic.

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<v Speaker 2>I've never heard that before. Is that still a thing?

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<v Speaker 3>Tom, No, I don't think so.

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<v Speaker 4>You know, during the pandemic, when people were afraid that

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<v Speaker 4>there was going to be a boom coming out and

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<v Speaker 4>there ended up being one at the end of twenty

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<v Speaker 4>and all of twenty one and summ of twenty.

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<v Speaker 3>Two, that made sense.

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<v Speaker 4>But right now companies are more sitting here saying what

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<v Speaker 4>puts us in the strongest position to compete no matter

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<v Speaker 4>what the economic climate. And if you're a big company,

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<v Speaker 4>you do have excess labor, and so it's easy to

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<v Speaker 4>cut that back.

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<v Speaker 3>If you're a small company, you.

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<v Speaker 4>Couldn't always compete against big companies because you can't pay

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<v Speaker 4>the same wage. Well, when those big companies prune and

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<v Speaker 4>late p people off, now you can get some of

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<v Speaker 4>that talent for a little bit lower price. And at

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<v Speaker 4>the same time those people are a little bit burned

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<v Speaker 4>feel burned by the big companies. So you get a

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<v Speaker 4>more engaged employee who really appreciates the quality of life

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<v Speaker 4>at a smaller, medium sized company.

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<v Speaker 6>All right, we.

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<v Speaker 5>Appreciate it, Tom, Always good to get your perspective. Thank

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<v Speaker 5>you so very much. Tom Gimbal, Vice chairman American Staffing

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<v Speaker 5>Association and founder of LASAL Network, really helping understand the

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<v Speaker 5>difference of the big large companies and the smaller medium

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<v Speaker 5>sized businesses. I never thought that, like, if you get

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<v Speaker 5>fired in a large firm that the small medium sized

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<v Speaker 5>firm benefits.

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<v Speaker 6>That actually makes sense.

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<v Speaker 2>Good, Yeah, I guess in certain industries, yeah, certain areas.

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<v Speaker 2>So I'll have to see.

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<v Speaker 1>You're listening to the Bloomberg Intelligence Podcast. Catch us live

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<v Speaker 5>Kelex still here alongside Paul Sweeney. This is Bloomberg Intelligence Radio.

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<v Speaker 5>We bring you all the top news and business, economics

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<v Speaker 5>and finance through our lens of our Oomberg Intelligence folks.

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<v Speaker 5>They cover two thousand companies and one hundred and thirty

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<v Speaker 5>industries all around the world.

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<v Speaker 6>We also have an amazing bench of reporters as.

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<v Speaker 5>Well as bureau chiefs that we like to tap as well.

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<v Speaker 5>We're going to go to one of them now, brook Sutherland.

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<v Speaker 5>She is the Boston bureau chief, one of my favorite people,

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<v Speaker 5>one of the smartest people that I've ever met. So

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<v Speaker 5>the headline for Boston is that President Trump is announced

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<v Speaker 5>that Harvard University would lose its tax exempt status and

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<v Speaker 5>that threatens to revoke the school's financial benefits. Brook, what's

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<v Speaker 5>the vibe in Boston right now.

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<v Speaker 7>I mean, I think the vibe is not great. I

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<v Speaker 7>think there's a lot of concern about not just what

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<v Speaker 7>happens with Harvard, but what happens with some of the

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<v Speaker 7>other funding cuts, specifically around the NIH. I mean, this

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<v Speaker 7>is an economy that really thrives off of its higher

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<v Speaker 7>education institutions, its top tier hospitals, and its research facilities.

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<v Speaker 7>And these organizations support a much broader ecosystem that is

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<v Speaker 7>very linked to Massachusetts employment and the other overall health

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<v Speaker 7>of the state economy. And so this is an issue

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<v Speaker 7>that state politicians have really, you know, rallied around Harvard

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<v Speaker 7>for you know, in terms of just really pushing back

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<v Speaker 7>on this and trying to protect those interests that are

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<v Speaker 7>key to their economy. We've even seen, you know, the

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<v Speaker 7>Republican candidate for governor coming out and advocating for the

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<v Speaker 7>funding that goes to some of these institutions in the

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<v Speaker 7>important role that they play in the Massachusetts economy.

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<v Speaker 2>What's the feeling a Brook as to the legality of

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<v Speaker 2>such a move. Does the President have the legal authority

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<v Speaker 2>to do so.

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<v Speaker 7>It's still not clear at this point whether or not

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<v Speaker 7>his comments this morning about revoking Harvard's tax exempt status

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<v Speaker 7>actually came in conjunction with the directive from the I R.

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<v Speaker 7>S or from him in particular. It's it's not clear

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<v Speaker 7>exactly sort of what steps are being taken or where

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<v Speaker 7>we might be in any kind of process.

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<v Speaker 8>Now.

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<v Speaker 7>Typically the IRS standards prevent the President from interfering with

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<v Speaker 7>federal tax agency decisions, and so this is undoubtedly something

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<v Speaker 7>that if you know, the administration were to proceed with

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<v Speaker 7>revoking targets Harvard's tax exempt status, that you would likely

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<v Speaker 7>see the university challenge that, and it's a process that

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<v Speaker 7>would take years to play out between appeals and you know,

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<v Speaker 7>negotiations over what might happen here.

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<v Speaker 5>So the dum dums like me are going to be like,

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<v Speaker 5>what's the big deal. They have a big endowment, they

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<v Speaker 5>charge a lot to tuition, Like why do they need

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<v Speaker 5>the status and what's the actual argument.

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<v Speaker 7>So the endowment is helpful, but you can't really use

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<v Speaker 7>it like an ATM or you know, a piggy bank.

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<v Speaker 7>The funds that are in there are mostly earmarked for

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<v Speaker 7>certain programs, you know, scholarships, certain schools, and so they

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<v Speaker 7>can't just use that money as they wish to plug

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<v Speaker 7>whatever gaps that they might have. And you know, Harvard

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<v Speaker 7>is certainly in a better position to weather this storm

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<v Speaker 7>than a lot of institutions. It's one of the oldest

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<v Speaker 7>in the country and also the richest. But you know,

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<v Speaker 7>I still think the financial toll of this can be

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<v Speaker 7>really significant, and it can affect how the university dolls

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<v Speaker 7>out financial aid. If they're not tax exept, they would

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<v Speaker 7>also have to pay property taxes. They have a lot

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<v Speaker 7>of real estate, not just in Cambridge, but also in

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<v Speaker 7>Boston proper, and that bill alone would be extremely substantial.

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<v Speaker 2>And stripping Harvard's taxes and status would deal a significant

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<v Speaker 2>financial blow to the university. This is in Bloomberg reporting,

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<v Speaker 2>which receives an estimated foreigner and sixty five million dollars

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<v Speaker 2>in tax benefits annually. And it's not just Harvard again, Brooke,

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<v Speaker 2>looking at your report here, some seventeen hundred private colleges

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<v Speaker 2>operate as nonprofits. Given their contributions to society, they receive

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<v Speaker 2>that benefit part of a section of the Internal Revenue

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<v Speaker 2>Service tax Code, which specifically mentions education as being a

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<v Speaker 2>purpose that can receive the exemption. So I'm guessing pretty

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<v Speaker 2>much every private college and the university around the country

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<v Speaker 2>brook is looking to this Harvard case.

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<v Speaker 7>I think they definitely are. I mean, I think there's

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<v Speaker 7>a question of whether, you know, the administration is particularly

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<v Speaker 7>targeting Harvard because it is so well known and so

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<v Speaker 7>prestigious in terms of trying to effectuate some of the

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<v Speaker 7>change that it wants to see on college campuses. You know,

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<v Speaker 7>it's sort of making a model out of Harvard versus

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<v Speaker 7>some of the other universities in the country. But certainly,

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<v Speaker 7>I think they are watching this very carefully. And if

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<v Speaker 7>they're not, you know, directly connected to this particular fighter

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<v Speaker 7>going to see their own tax exempt status called into question,

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<v Speaker 7>they're likely feeling the pressure of the funding cuts because

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<v Speaker 7>NIH funding does not just go to the Harvards and

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<v Speaker 7>the Mits of the world. It also goes to a

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<v Speaker 7>number of other universities spread out all across the country

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<v Speaker 7>that are doing, you know, very important work to advance

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<v Speaker 7>US competitiveness and things that we've decided our national priorities,

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<v Speaker 7>you know, things around national security, around medical advancements, semiconductor research,

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<v Speaker 7>I mean, this all takes money, and historically that's a

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<v Speaker 7>role that the government has played in supporting that research

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<v Speaker 7>and innovation.

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<v Speaker 5>Uh Brook, before we let you go, also touted your

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<v Speaker 5>expertise in the industrial industry. You've covered the industrial industry

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<v Speaker 5>for a very long time. You have a weekly newsletter

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<v Speaker 5>that sort of picks up on all the little details

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<v Speaker 5>happening within that very important space. And in your piece

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<v Speaker 5>today you talked about toothpaste versus which is like basically

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<v Speaker 5>factory orders. Can you give me the takeaway from that?

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<v Speaker 5>I thought it was quite interesting, is how we're looking

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<v Speaker 5>at the economy.

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<v Speaker 7>Sure, I mean, I think there was a lot of

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<v Speaker 7>concern heading into this earning season about what we might

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<v Speaker 7>see from the manufacturing economy, the thinking being that that

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<v Speaker 7>was sort of the front lines of where tariffs would hit.

0:11:33.920 --> 0:11:37.480
<v Speaker 7>And these companies are certainly, you know, expecting an impact,

0:11:37.559 --> 0:11:40.600
<v Speaker 7>but by and large, they're mostly doing okay. I mean,

0:11:40.640 --> 0:11:44.000
<v Speaker 7>the demand in the first quarter was very strong, and

0:11:44.040 --> 0:11:47.280
<v Speaker 7>so far companies really aren't flagging any kind of material

0:11:47.400 --> 0:11:50.600
<v Speaker 7>step back or you know, some sort of serious pause

0:11:50.679 --> 0:11:54.000
<v Speaker 7>in projects. It's a very different story on the consumer

0:11:54.080 --> 0:11:56.720
<v Speaker 7>side of the economy though. I mean, you've seen airlines

0:11:56.760 --> 0:11:59.280
<v Speaker 7>pull their guidance because of a pullback and travel demand,

0:11:59.280 --> 0:12:03.199
<v Speaker 7>the concerns about consumer confidence. You've seen companies like Colgate

0:12:03.240 --> 0:12:06.880
<v Speaker 7>palm Olive, which makes toothpaste, with sales dropped about three

0:12:06.880 --> 0:12:09.520
<v Speaker 7>percent and the first quarter in part because customers are

0:12:09.559 --> 0:12:13.360
<v Speaker 7>trading down from premium toothpaste options to sort of middle

0:12:13.400 --> 0:12:16.679
<v Speaker 7>tier options, and that trade down effect is manifesting, you know,

0:12:16.720 --> 0:12:19.600
<v Speaker 7>in a number of different places across the consumer economy,

0:12:19.920 --> 0:12:23.120
<v Speaker 7>and I think, you know, it's just interesting. There was

0:12:23.160 --> 0:12:25.120
<v Speaker 7>an argument a few years ago about could you see

0:12:25.120 --> 0:12:27.800
<v Speaker 7>sort of a decoupling of the manufacturing sector from the

0:12:27.840 --> 0:12:30.400
<v Speaker 7>rest of the economy because there are sort of secular

0:12:30.480 --> 0:12:35.680
<v Speaker 7>reasons driving construction of new factories, whether it's reshoring or

0:12:35.760 --> 0:12:38.640
<v Speaker 7>you know, some of the energy initiatives that we've had,

0:12:38.679 --> 0:12:42.400
<v Speaker 7>all of the government stimulus around infrastructure and semiconductors that

0:12:42.480 --> 0:12:46.520
<v Speaker 7>didn't happen, And I think it would be extremely difficult

0:12:46.600 --> 0:12:49.640
<v Speaker 7>for that to happen again in an environment if we

0:12:49.720 --> 0:12:53.040
<v Speaker 7>do see tariffs really damp and consumer confidence and really

0:12:53.080 --> 0:12:55.760
<v Speaker 7>cause that consumer to pull back on spending. It's hard

0:12:55.840 --> 0:12:59.920
<v Speaker 7>to keep industrial equipment orders going along at a role

0:13:00.240 --> 0:13:03.520
<v Speaker 7>place when people can't afford sort of basic needs.

0:13:04.040 --> 0:13:05.800
<v Speaker 6>All right, Brooke, we really appreciate it. Thank you so

0:13:05.960 --> 0:13:06.319
<v Speaker 6>very much.

0:13:06.520 --> 0:13:09.160
<v Speaker 5>Brooks Sutherland, Boston Bureau Chief in Industrials expert.

0:13:09.240 --> 0:13:10.040
<v Speaker 6>Right here at.

0:13:10.000 --> 0:13:15.560
<v Speaker 1>Bloomberg, you're listening to the Bloomberg Intelligence podcast. Catch us

0:13:15.640 --> 0:13:19.040
<v Speaker 1>live weekdays at ten am Eastern on Applecarclay, and Android

0:13:19.080 --> 0:13:22.360
<v Speaker 1>Auto with the Bloomberg Business app. Listen on demand wherever

0:13:22.440 --> 0:13:26.040
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0:13:26.320 --> 0:13:27.080
<v Speaker 6>For a recap.

0:13:27.440 --> 0:13:30.319
<v Speaker 5>Chevron made a bid Dubai, Hess has accepted, and then

0:13:30.320 --> 0:13:32.160
<v Speaker 5>Exon came in and said, no, we have rite a

0:13:32.200 --> 0:13:35.760
<v Speaker 5>first refusal to Hess's project in Guyana, which is a

0:13:35.800 --> 0:13:39.040
<v Speaker 5>prolific oil region, and they've been an arbitration for quite

0:13:39.040 --> 0:13:41.600
<v Speaker 5>a long time on that. We may get final result

0:13:41.679 --> 0:13:44.480
<v Speaker 5>later on in this year. Vince Piazza heads up all

0:13:44.480 --> 0:13:48.920
<v Speaker 5>our oil and industry coverage for Bloomberg Intelligence and joins me, Now, Vincent,

0:13:48.960 --> 0:13:51.000
<v Speaker 5>what do you think of the answer that Nope, they

0:13:51.040 --> 0:13:52.199
<v Speaker 5>got complete confidence.

0:13:52.400 --> 0:13:54.239
<v Speaker 6>If Chevron doesn't get Hess.

0:13:54.600 --> 0:14:00.200
<v Speaker 8>What happens, well, look is, if Sevron doesn't get Hess,

0:14:00.240 --> 0:14:06.520
<v Speaker 8>someone of size would need to make a move on Hess, right,

0:14:06.840 --> 0:14:07.600
<v Speaker 8>and you.

0:14:07.559 --> 0:14:12.640
<v Speaker 9>Know Exon suggests that it has these preemptive rights, and

0:14:12.720 --> 0:14:16.800
<v Speaker 9>so if the arbitration goes in its favor, there would

0:14:16.800 --> 0:14:19.680
<v Speaker 9>be a decision that needs to be made about that

0:14:19.880 --> 0:14:23.840
<v Speaker 9>value and what that value is. And I would suggest

0:14:23.840 --> 0:14:28.320
<v Speaker 9>to you that because of Hesse's size, the number of

0:14:28.400 --> 0:14:32.840
<v Speaker 9>suitors for hes whether it's the asset or the entire entity,

0:14:33.800 --> 0:14:37.080
<v Speaker 9>is quite limited, and you need someone that has the heft,

0:14:37.640 --> 0:14:42.680
<v Speaker 9>the balance sheet, the flexibility, the financial flexibility of an

0:14:42.720 --> 0:14:47.680
<v Speaker 9>Exon mobile and so I think both entities have a

0:14:47.720 --> 0:14:51.200
<v Speaker 9>solid case to be made. I've never heard of an

0:14:51.280 --> 0:14:56.400
<v Speaker 9>acquisition being held up because of a shared asset, but

0:14:57.120 --> 0:14:59.760
<v Speaker 9>you know, a lot of strange things that happened in

0:14:59.760 --> 0:15:03.920
<v Speaker 9>the world in the last year or so, so we'll

0:15:03.960 --> 0:15:06.840
<v Speaker 9>see what happens. But I think if you take a

0:15:06.880 --> 0:15:11.000
<v Speaker 9>look at just the earnings from today, guys, I think

0:15:11.000 --> 0:15:18.440
<v Speaker 9>it's obvious that Exon is pulling away both operationally and financially.

0:15:18.840 --> 0:15:23.800
<v Speaker 9>And I think that if you were to take a

0:15:23.840 --> 0:15:26.560
<v Speaker 9>look at this a year from now, you would see

0:15:26.680 --> 0:15:32.560
<v Speaker 9>the ongoing strength of the Exon operations and Exon's financial health.

0:15:32.800 --> 0:15:33.600
<v Speaker 9>Financial health.

0:15:33.720 --> 0:15:37.320
<v Speaker 2>Right, So, hey, Vince, you've been covering these big oil

0:15:37.320 --> 0:15:40.280
<v Speaker 2>companies integrated oil companies for years. Here what are they

0:15:40.320 --> 0:15:43.640
<v Speaker 2>telling you with about life at blows sixty dollars a

0:15:43.640 --> 0:15:45.880
<v Speaker 2>borrower around sixty dollars a borrower for WTI crud.

0:15:47.160 --> 0:15:52.240
<v Speaker 9>You know, life is sustainable when you have solid balance

0:15:52.240 --> 0:15:56.560
<v Speaker 9>sheet and you have the financial strength. And in this

0:15:56.640 --> 0:16:01.880
<v Speaker 9>case you have Exon Mobile, which paid back roughly five

0:16:01.960 --> 0:16:07.280
<v Speaker 9>billion of debt. Balance sheet leverage is very, very manageable.

0:16:08.480 --> 0:16:12.880
<v Speaker 9>They have the financial flexibility to push forward financially. They

0:16:12.920 --> 0:16:15.960
<v Speaker 9>threw off about nine billion of free castulow eight point

0:16:15.960 --> 0:16:23.440
<v Speaker 9>eight to be exact. The cadence of buybacks remains the same,

0:16:24.120 --> 0:16:28.280
<v Speaker 9>the dividend pace remains the same. So there is strength

0:16:28.440 --> 0:16:33.520
<v Speaker 9>there in their confidence in their decision to maintain those levels.

0:16:35.240 --> 0:16:39.920
<v Speaker 9>Contrast that with what you heard from Stevron. And when

0:16:39.920 --> 0:16:42.880
<v Speaker 9>you're throwing off roughly a billion dollars of free castlow

0:16:43.440 --> 0:16:45.920
<v Speaker 9>and you're trying to pay out dividends of three and

0:16:46.320 --> 0:16:50.560
<v Speaker 9>do buybacks of another four, the math doesn't compute right,

0:16:50.560 --> 0:16:56.560
<v Speaker 9>and so that pretends the decision to scale back the

0:16:56.640 --> 0:16:59.440
<v Speaker 9>buy backs closer to what two and a half or

0:16:59.640 --> 0:17:05.360
<v Speaker 9>three billion four to twenty twenty five. Hey, look, you know, operationally,

0:17:05.640 --> 0:17:10.240
<v Speaker 9>Exon's in a strong position, especially in Guiana, especially in

0:17:10.320 --> 0:17:13.840
<v Speaker 9>the Permian. You have a yellow tail likely coming on

0:17:14.040 --> 0:17:18.480
<v Speaker 9>sooner than expected, most likely in three Q. That's two

0:17:18.560 --> 0:17:22.160
<v Speaker 9>hundred and fifty thousand barrels a day of growth capacity

0:17:23.200 --> 0:17:27.360
<v Speaker 9>on a resource that has potential of well in excess

0:17:27.400 --> 0:17:30.760
<v Speaker 9>of six billion dollars. So you could understand the attraction

0:17:31.400 --> 0:17:35.480
<v Speaker 9>for both Exon and for Devron, and you know Exon's

0:17:35.520 --> 0:17:40.800
<v Speaker 9>and a driver feet there. You have also for Exon

0:17:41.520 --> 0:17:46.240
<v Speaker 9>the pioneer acquisition the Permium basin, which remains a strong,

0:17:46.840 --> 0:17:51.359
<v Speaker 9>low cost avenue for growth. So I'm not really concerned

0:17:51.400 --> 0:17:57.160
<v Speaker 9>here if this dips below the sixty six dollars Bollol range,

0:17:57.440 --> 0:18:01.399
<v Speaker 9>especially when you have the balance sheet strength to push

0:18:01.480 --> 0:18:05.959
<v Speaker 9>through that. Now, fifteen twenty years ago, the economics were different,

0:18:06.119 --> 0:18:10.800
<v Speaker 9>right leverage was a bigger thwart and also a bigger

0:18:10.840 --> 0:18:14.800
<v Speaker 9>thwart of pain for these organizations as well. But for

0:18:14.920 --> 0:18:17.439
<v Speaker 9>the most part, a lot of these names have gotten

0:18:17.480 --> 0:18:19.960
<v Speaker 9>their balance beats, and the right size and the right

0:18:20.040 --> 0:18:25.720
<v Speaker 9>gape maturities are quite manageable in twenty five and twenty six,

0:18:25.840 --> 0:18:29.040
<v Speaker 9>so I don't see the pain coming from any type

0:18:29.080 --> 0:18:32.320
<v Speaker 9>of balance sheet event. And for the most part, what

0:18:32.359 --> 0:18:37.280
<v Speaker 9>we're telling the operators is, let's manage that production. We

0:18:37.359 --> 0:18:40.720
<v Speaker 9>want to see the free cashulow being thrown off. We

0:18:40.880 --> 0:18:44.960
<v Speaker 9>don't want this excessive accelerated growth that we saw during

0:18:45.440 --> 0:18:48.960
<v Speaker 9>a one point zero. We're in a different situation here.

0:18:49.040 --> 0:18:52.159
<v Speaker 9>It's a mature industry. What we do want to see

0:18:52.480 --> 0:18:56.240
<v Speaker 9>is much more capital discipline. It's fine if you want

0:18:56.280 --> 0:19:01.200
<v Speaker 9>to go out there and pay for an asset using

0:19:01.400 --> 0:19:04.600
<v Speaker 9>your currency, using you for equity, because your equity is

0:19:04.720 --> 0:19:09.359
<v Speaker 9>valued higher than what a private equity sponsored company may be,

0:19:09.600 --> 0:19:14.119
<v Speaker 9>and you can consolidate, integrate and actually increase recash flow

0:19:14.400 --> 0:19:15.600
<v Speaker 9>going forward as well.

0:19:15.840 --> 0:19:17.960
<v Speaker 6>All Right, Ben, thanks a lot. We really appreciate it.

0:19:18.040 --> 0:19:21.639
<v Speaker 5>Vincent Piazza, he covers Boom, all the oil companies E

0:19:21.720 --> 0:19:24.879
<v Speaker 5>ANDPS as well as the big guys for Bloomberg Intelligence.

0:19:24.880 --> 0:19:27.800
<v Speaker 6>We appreciate all of that insight. Shameless Plug.

0:19:27.840 --> 0:19:29.919
<v Speaker 5>You can check out my full cheve On interview on

0:19:30.320 --> 0:19:33.320
<v Speaker 5>the Bloomberg podcast page on YouTube. It's also available on

0:19:33.359 --> 0:19:36.040
<v Speaker 5>Bloomberg dot com, and you can also check it out

0:19:36.040 --> 0:19:37.160
<v Speaker 5>on the terminal as well.

0:19:37.200 --> 0:19:38.520
<v Speaker 6>Shameless plug, I did it.

0:19:39.320 --> 0:19:44.040
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