1 00:00:02,520 --> 00:00:13,760 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg 2 00:00:13,840 --> 00:00:17,920 Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern 3 00:00:18,200 --> 00:00:22,000 Speaker 1: on Apple CarPlay or Android Auto with the Bloomberg Business app. 4 00:00:22,360 --> 00:00:25,680 Speaker 1: Listen on demand wherever you get your podcasts, or watch 5 00:00:25,760 --> 00:00:28,680 Speaker 1: us live on YouTube and off of the weekend. 6 00:00:28,720 --> 00:00:31,560 Speaker 2: I love what jillmo X said at AXA in Paris. 7 00:00:31,600 --> 00:00:35,400 Speaker 3: He said, it is searching in vain for information. 8 00:00:36,000 --> 00:00:40,239 Speaker 2: In charge of information for Bloomberg Surveillance, Lori Kelvisina with 9 00:00:40,520 --> 00:00:42,560 Speaker 2: RBC Capital Markets. 10 00:00:42,800 --> 00:00:44,160 Speaker 3: I say, when you walked in. 11 00:00:44,040 --> 00:00:46,360 Speaker 2: Today, what'd you first look at? But like all of us, 12 00:00:46,400 --> 00:00:50,000 Speaker 2: you were working all weekend. What were you both stirring 13 00:00:50,600 --> 00:00:53,040 Speaker 2: in the Kelvisina system this weekend? 14 00:00:53,159 --> 00:00:55,840 Speaker 4: Well, so I'll tell you. On Friday I wrote my 15 00:00:55,880 --> 00:00:58,040 Speaker 4: weekly and then what I was doing Saturday night and 16 00:00:58,080 --> 00:01:00,240 Speaker 4: Sunday night because I have little kids, so you know, 17 00:01:00,280 --> 00:01:01,440 Speaker 4: I have to do a lot of this at night 18 00:01:01,480 --> 00:01:02,320 Speaker 4: after they go to sleep. 19 00:01:02,360 --> 00:01:06,039 Speaker 3: But I was reading Please, you said the what's the masters? 20 00:01:06,360 --> 00:01:09,000 Speaker 4: Mom's got to work, I was saying to Gargy earlier. 21 00:01:09,000 --> 00:01:11,080 Speaker 4: I'm now starting to watch White Lotus. This is the 22 00:01:11,080 --> 00:01:13,000 Speaker 4: first TV show I've watched in years because I just 23 00:01:13,040 --> 00:01:16,400 Speaker 4: don't have time. But honestly, my free time this weekend, 24 00:01:16,400 --> 00:01:18,840 Speaker 4: I was reading through Earning's called transcripts, and then I 25 00:01:18,880 --> 00:01:21,759 Speaker 4: was also reading through conference transcripts. And my team had 26 00:01:21,760 --> 00:01:23,800 Speaker 4: done a first pass on me last week for me 27 00:01:23,880 --> 00:01:27,199 Speaker 4: last week, but we were reading across the Russell three thousand, 28 00:01:27,319 --> 00:01:29,839 Speaker 4: not just the SMP five hundred. And I'm a little 29 00:01:29,880 --> 00:01:32,440 Speaker 4: bit of a transcript junkie. I have been really since 30 00:01:32,480 --> 00:01:36,080 Speaker 4: twenty sixteen, twenty seventeen, twenty eighteen, and we've learned that 31 00:01:36,120 --> 00:01:38,800 Speaker 4: in these periods where everything is uncertain and shifting, don't 32 00:01:38,840 --> 00:01:41,600 Speaker 4: just look at the SMP five hundred. The Russell companies, 33 00:01:41,640 --> 00:01:44,200 Speaker 4: the smaller cap companies have simpler business models and they 34 00:01:44,240 --> 00:01:47,319 Speaker 4: can often sort of help you home in on specific 35 00:01:47,360 --> 00:01:48,640 Speaker 4: issues with a lot more clarity. 36 00:01:48,760 --> 00:01:51,240 Speaker 2: And this is so much in honor of work at 37 00:01:51,240 --> 00:01:55,200 Speaker 2: Bloomberg by rich Yamarone, who we had lost way too early. 38 00:01:55,760 --> 00:02:00,320 Speaker 2: Yamarone did the Orange Book, which invented forget about all 39 00:02:00,360 --> 00:02:04,560 Speaker 2: the numbers, just listen to people. After someone like Lauri 40 00:02:04,720 --> 00:02:06,520 Speaker 2: Kelvicina says, great. 41 00:02:06,320 --> 00:02:10,080 Speaker 5: Quarter exactly, So, Laurie, what have you guys done at 42 00:02:10,160 --> 00:02:12,960 Speaker 5: RBC and your group there with your S and P 43 00:02:13,080 --> 00:02:15,000 Speaker 5: five hundred targets and your earnings. 44 00:02:15,160 --> 00:02:19,000 Speaker 4: So we've cut them twice this year. March seventeenth was 45 00:02:19,040 --> 00:02:21,280 Speaker 4: the first time. I'm honestly it was. It was the 46 00:02:21,400 --> 00:02:25,639 Speaker 4: Thursday night after Liberation Day. I can't remember what date 47 00:02:25,680 --> 00:02:29,920 Speaker 4: that was that we did the second hut. Time is 48 00:02:29,960 --> 00:02:33,480 Speaker 4: warping in here, but we cut things twice. And what 49 00:02:33,560 --> 00:02:37,000 Speaker 4: we did in that sort of early April adjustment was 50 00:02:37,000 --> 00:02:39,160 Speaker 4: we shifted from our bullcase to our barecase. And we've 51 00:02:39,160 --> 00:02:42,079 Speaker 4: been telegraphing that we would need to do so if 52 00:02:42,120 --> 00:02:45,040 Speaker 4: we broke below ten percent from the February peak. What 53 00:02:45,120 --> 00:02:47,800 Speaker 4: was interesting was pre rose Garden the market was trying 54 00:02:47,840 --> 00:02:50,240 Speaker 4: to hold in sort of garden variety five to ten 55 00:02:50,280 --> 00:02:53,360 Speaker 4: percent correction territory. The market's kind of doing the same 56 00:02:53,360 --> 00:02:55,280 Speaker 4: thing right now in growth scare territory. 57 00:02:55,320 --> 00:02:56,200 Speaker 5: We went down on. 58 00:02:56,120 --> 00:02:59,399 Speaker 4: Tuesday's clothes and touched minus eighteen point nine percent from 59 00:02:59,400 --> 00:03:02,000 Speaker 4: the peak. That is very similar to what we did 60 00:03:02,040 --> 00:03:04,240 Speaker 4: back in twenty eighteen, and that's basically in line with 61 00:03:04,280 --> 00:03:06,840 Speaker 4: your average kind of growth scare where there's a fear 62 00:03:06,840 --> 00:03:08,959 Speaker 4: of a recession or big breakdown that doesn't happen. 63 00:03:09,480 --> 00:03:12,679 Speaker 5: So what do we I guess, let's just go to 64 00:03:12,720 --> 00:03:14,480 Speaker 5: the earning front. Since we're starting to kick into the 65 00:03:14,480 --> 00:03:17,280 Speaker 5: earning season here, it's not so much what they what 66 00:03:17,320 --> 00:03:19,080 Speaker 5: we're going to hear about their first quarter performance as 67 00:03:19,080 --> 00:03:22,639 Speaker 5: warm about what companies are. Do you expect any companies 68 00:03:22,639 --> 00:03:24,239 Speaker 5: to provide guidance or how do you think about the 69 00:03:24,280 --> 00:03:24,760 Speaker 5: earnings out. 70 00:03:24,680 --> 00:03:26,480 Speaker 4: Well, so there are some that are still doing it 71 00:03:26,520 --> 00:03:28,080 Speaker 4: and there are some that are not. What I will 72 00:03:28,080 --> 00:03:30,160 Speaker 4: tell you is a positive development, Paul, and I know 73 00:03:30,200 --> 00:03:32,560 Speaker 4: I was sort of ranting about this on television last week, 74 00:03:32,680 --> 00:03:36,640 Speaker 4: but companies are finally giving us a more detailed conversation 75 00:03:36,840 --> 00:03:39,440 Speaker 4: about their exposure, not just to China. We've been hearing 76 00:03:39,480 --> 00:03:41,760 Speaker 4: about that since November, but they're finally starting to talk 77 00:03:41,800 --> 00:03:45,040 Speaker 4: about Vietnam and Mexico and Canada and other countries. So 78 00:03:45,120 --> 00:03:47,560 Speaker 4: they've been sort of shocked into having a more honest 79 00:03:47,640 --> 00:03:50,760 Speaker 4: and detailed conversation with the south Side community and the 80 00:03:50,800 --> 00:03:54,360 Speaker 4: Byside community. Frankly, and to me, that's more important than 81 00:03:54,400 --> 00:03:57,400 Speaker 4: why whether or not, you know, we suspend guidance. Some 82 00:03:57,560 --> 00:04:00,520 Speaker 4: companies are baking some tariffins, some aren't, But it's the 83 00:04:00,600 --> 00:04:03,880 Speaker 4: level of discussion. We just have needed more disclosure. I 84 00:04:03,880 --> 00:04:06,280 Speaker 4: think that's why we've seen such big gaps in here. 85 00:04:07,000 --> 00:04:08,600 Speaker 5: So what do we do going forward? 86 00:04:08,600 --> 00:04:08,800 Speaker 2: Here? 87 00:04:08,920 --> 00:04:09,120 Speaker 3: Is it? 88 00:04:10,760 --> 00:04:14,080 Speaker 5: Are you recommending more cash and you typically do? Are 89 00:04:14,120 --> 00:04:17,120 Speaker 5: you reckoning a bigger treasury portfolio than you typically do? 90 00:04:17,279 --> 00:04:19,720 Speaker 4: Or so I stick in the equity world, and so 91 00:04:19,960 --> 00:04:22,440 Speaker 4: you know, I don't you know, I always like us equities, 92 00:04:22,480 --> 00:04:24,520 Speaker 4: you know, I tend to say, And you know, we 93 00:04:24,560 --> 00:04:26,640 Speaker 4: haven't made a change in our target. We're still sticking 94 00:04:26,680 --> 00:04:28,680 Speaker 4: with the fifty five to fifty. We have said if 95 00:04:28,760 --> 00:04:31,080 Speaker 4: recession is starting to get baked in, we're going to 96 00:04:31,080 --> 00:04:33,159 Speaker 4: have another break lower. I don't think that's baked into 97 00:04:33,200 --> 00:04:35,279 Speaker 4: the price now. Okay, But I was on the road 98 00:04:35,360 --> 00:04:38,000 Speaker 4: last week with Amy with Silverman, my partner in crime, 99 00:04:38,040 --> 00:04:39,960 Speaker 4: over at RBC, and we were seeing a bunch of 100 00:04:40,000 --> 00:04:43,000 Speaker 4: clients and we actually saw these younger guys who'd only 101 00:04:43,000 --> 00:04:45,200 Speaker 4: been in the business a couple of years, and they 102 00:04:45,320 --> 00:04:47,040 Speaker 4: just sort of, you know, I forget how we got 103 00:04:47,040 --> 00:04:49,000 Speaker 4: on this topic. And the advice I gave them, I 104 00:04:49,040 --> 00:04:52,479 Speaker 4: think applies to everybody. I said, we never know in 105 00:04:52,560 --> 00:04:54,440 Speaker 4: these periods, in the moment where we bought them, we 106 00:04:54,480 --> 00:04:56,400 Speaker 4: never know how low exactly it's going to go. We 107 00:04:56,440 --> 00:04:58,520 Speaker 4: have our milestones. We're going to check those off. We're 108 00:04:58,560 --> 00:05:00,560 Speaker 4: going to keep an eye on those. We want to 109 00:05:00,600 --> 00:05:02,920 Speaker 4: do two things right now. You want to look for 110 00:05:03,160 --> 00:05:06,599 Speaker 4: the defensive opportunity and the rebound opportunity, and you kind 111 00:05:06,600 --> 00:05:09,360 Speaker 4: of have to do both. So on the defensive side, 112 00:05:09,480 --> 00:05:12,120 Speaker 4: we've liked utilities all along, we're sticking with that. On 113 00:05:12,160 --> 00:05:16,039 Speaker 4: the offensive side, we really like financials. And our point 114 00:05:16,080 --> 00:05:18,279 Speaker 4: to these guys was you're not going to be able 115 00:05:18,320 --> 00:05:20,040 Speaker 4: to peg the bottom, so don't even try. 116 00:05:20,680 --> 00:05:24,120 Speaker 5: All right, So financials on the rebound d s. Do 117 00:05:24,200 --> 00:05:26,320 Speaker 5: you hear anything on Friday that it kind of gave 118 00:05:26,320 --> 00:05:27,880 Speaker 5: you a greater conviction when we heard from some of 119 00:05:27,880 --> 00:05:29,360 Speaker 5: the big banks, and we hear from Goldman today. 120 00:05:29,440 --> 00:05:32,320 Speaker 4: Yeah, so you know, we're definitely seeing, right the benefits 121 00:05:32,400 --> 00:05:35,880 Speaker 4: of increased activity and getting some rotation in the market 122 00:05:35,920 --> 00:05:38,480 Speaker 4: and things, you know, generally functioning properly. I know there 123 00:05:38,480 --> 00:05:40,880 Speaker 4: were some questions about that on the bond market last week, 124 00:05:40,880 --> 00:05:42,840 Speaker 4: but that seems to have been, you know, died down 125 00:05:42,880 --> 00:05:45,960 Speaker 4: at this point anyway. But I think that what I 126 00:05:46,040 --> 00:05:49,280 Speaker 4: really have heard, you know, from the banking community in particular, 127 00:05:49,880 --> 00:05:52,280 Speaker 4: is their ability to manage through crises and so all 128 00:05:52,320 --> 00:05:55,240 Speaker 4: of the learnings from the GFC, even SBB. Frankly, I 129 00:05:55,240 --> 00:05:57,400 Speaker 4: think was a great road test for these companies and 130 00:05:57,560 --> 00:06:00,000 Speaker 4: I felt like I heard that confidence come through last week. 131 00:06:00,400 --> 00:06:00,880 Speaker 3: What's the. 132 00:06:02,360 --> 00:06:07,960 Speaker 2: Idea of do nothing? Is that an efficacious strategy? 133 00:06:08,120 --> 00:06:10,360 Speaker 4: It is sometimes you need to sit and listen to 134 00:06:10,400 --> 00:06:12,520 Speaker 4: the market and let things play out. And I know 135 00:06:12,600 --> 00:06:15,640 Speaker 4: that that is difficult for Wall Street people to do, 136 00:06:15,800 --> 00:06:17,719 Speaker 4: but I do think this is one of those times. 137 00:06:18,240 --> 00:06:22,880 Speaker 2: Excuse me, folks, I'm distracted learning about the amazing Blue 138 00:06:22,880 --> 00:06:25,720 Speaker 2: Origin flight we're going to see here in twenty minutes, 139 00:06:25,800 --> 00:06:27,000 Speaker 2: really extraordinary. 140 00:06:27,040 --> 00:06:28,320 Speaker 3: Lori Kelvcina, where. 141 00:06:28,120 --> 00:06:32,360 Speaker 2: It's for those of you across the nation, across Canada 142 00:06:32,520 --> 00:06:35,640 Speaker 2: of RBC Capital Markets, the Royal Bank of Canada. Good 143 00:06:35,640 --> 00:06:38,559 Speaker 2: Morning worldwide as well in your commute and of course 144 00:06:38,560 --> 00:06:42,640 Speaker 2: on YouTube subscribe to Bloomberg Podcast. Just can't say enough 145 00:06:42,800 --> 00:06:45,839 Speaker 2: about the YouTube distribution. We knew it was working, but 146 00:06:45,960 --> 00:06:48,400 Speaker 2: in this crisis, we've been humbled by the growth. Thank 147 00:06:48,440 --> 00:06:52,240 Speaker 2: you so much. Their futures up eighty eight, I mean, 148 00:06:52,320 --> 00:06:55,559 Speaker 2: Gold and Sacks went out and it's completely unfair question 149 00:06:55,640 --> 00:06:59,680 Speaker 2: to you. They popped a forty billion dollars share buyback 150 00:07:00,279 --> 00:07:04,280 Speaker 2: twenty five point two percent of their market cap? Are 151 00:07:04,279 --> 00:07:06,760 Speaker 2: we going to see more of these shocks where people 152 00:07:06,920 --> 00:07:09,720 Speaker 2: just say, we don't know what the White House is 153 00:07:09,760 --> 00:07:11,760 Speaker 2: going to do, We're going to be opportunistic. 154 00:07:12,400 --> 00:07:14,800 Speaker 4: So when I was talking to investors last week, we 155 00:07:14,800 --> 00:07:17,560 Speaker 4: were sort of debating pe multiples. Can you even really 156 00:07:17,640 --> 00:07:19,640 Speaker 4: you know, value a company right now and we don't 157 00:07:19,640 --> 00:07:22,920 Speaker 4: have visibility into the earnings. And what one investor told 158 00:07:22,960 --> 00:07:25,800 Speaker 4: me was, they're really buying good management teams right now, 159 00:07:26,120 --> 00:07:27,920 Speaker 4: and I think that's a very you know, sort of 160 00:07:27,960 --> 00:07:30,320 Speaker 4: smart way to think about it. Who can navigate through? 161 00:07:30,720 --> 00:07:33,640 Speaker 4: I will say on the buybacks in particular, when I 162 00:07:33,760 --> 00:07:35,760 Speaker 4: did my last round of updates on my S and 163 00:07:35,760 --> 00:07:38,200 Speaker 4: P earnings model, we actually had actual data and for 164 00:07:38,280 --> 00:07:40,880 Speaker 4: share counts as of one queue and it grew by 165 00:07:40,880 --> 00:07:43,920 Speaker 4: I think point nine percent year over year, and that's 166 00:07:43,960 --> 00:07:45,960 Speaker 4: the biggest we've seen. But we've had a string of 167 00:07:45,960 --> 00:07:48,840 Speaker 4: several quarters where the sharecounts have been growing, so I 168 00:07:48,880 --> 00:07:51,120 Speaker 4: don't think that And of course you have buybacks, but 169 00:07:51,120 --> 00:07:52,840 Speaker 4: there's issue went so but when you do all the 170 00:07:52,880 --> 00:07:56,400 Speaker 4: math right, like, we haven't had a de equitization theme, 171 00:07:56,840 --> 00:07:59,280 Speaker 4: you know, the way my former colleague Brob Bucklin used 172 00:07:59,280 --> 00:08:02,640 Speaker 4: to talk about. So it's it's interesting, you know, to 173 00:08:02,680 --> 00:08:04,600 Speaker 4: sort of hear that news in the context of this 174 00:08:04,640 --> 00:08:07,600 Speaker 4: hasn't really been a great period for shrinking the share counts. 175 00:08:07,680 --> 00:08:13,040 Speaker 2: Paul's the equidization English or is that Lori Kelvicina. 176 00:08:12,680 --> 00:08:16,560 Speaker 4: Ill That's that's Rob Bucklan, my old one of my 177 00:08:16,600 --> 00:08:17,880 Speaker 4: old mentors in the city. 178 00:08:18,200 --> 00:08:21,160 Speaker 5: What is it where we with small and mid cap 179 00:08:21,200 --> 00:08:22,040 Speaker 5: stocks these days? 180 00:08:22,160 --> 00:08:24,640 Speaker 4: So they were trying really hard before the rest starting 181 00:08:24,760 --> 00:08:27,040 Speaker 4: to bottom, and you're actually seeing some outperformance on the 182 00:08:27,040 --> 00:08:30,120 Speaker 4: big down days. As we have moved past that event, 183 00:08:30,520 --> 00:08:34,319 Speaker 4: investors are sort of toggling between sluggish growth, near stall 184 00:08:34,360 --> 00:08:36,640 Speaker 4: speed or recession. I don't think that it's a clear 185 00:08:36,720 --> 00:08:38,760 Speaker 4: cut case for recession yet, to be honest, but the 186 00:08:38,800 --> 00:08:41,320 Speaker 4: small caps are acting like it is, and so we 187 00:08:41,440 --> 00:08:44,040 Speaker 4: continued to see some underperformance. You've also been starting to 188 00:08:44,040 --> 00:08:46,719 Speaker 4: see growth outperform value, which is also consistent with the 189 00:08:46,760 --> 00:08:50,720 Speaker 4: sluggish economy. So it's there's opportunity there. We know we 190 00:08:50,800 --> 00:08:52,920 Speaker 4: need to buy them mid recession if we get one. 191 00:08:53,480 --> 00:08:57,559 Speaker 4: But in the short term they're they're expressing the economic case. 192 00:08:57,440 --> 00:08:59,840 Speaker 2: You mentioned being some financials just you know, to pick 193 00:09:00,040 --> 00:09:03,840 Speaker 2: on them in this Meliu is this where smaller banks 194 00:09:03,880 --> 00:09:05,599 Speaker 2: throw in the towel and we get an M and 195 00:09:05,640 --> 00:09:08,920 Speaker 2: A surprise and small in midcast I think. 196 00:09:08,800 --> 00:09:11,080 Speaker 4: That, you know, an old investment or back in my 197 00:09:11,240 --> 00:09:13,480 Speaker 4: back in my my first investment bank, I worked at 198 00:09:13,559 --> 00:09:16,439 Speaker 4: an investment banker there once told me that you look 199 00:09:16,440 --> 00:09:18,920 Speaker 4: at confidence, you look at the vics, you know, for 200 00:09:19,080 --> 00:09:21,600 Speaker 4: M and A deals, and we have lousy confidence. And 201 00:09:21,640 --> 00:09:23,800 Speaker 4: we've actually, you know, no one's debating if the BIX 202 00:09:23,880 --> 00:09:26,400 Speaker 4: is broken anymore. We've seen a breakout there. So I 203 00:09:26,679 --> 00:09:29,520 Speaker 4: do have a feeling, at least in the short term, 204 00:09:29,640 --> 00:09:31,679 Speaker 4: the kind of gloom on M and A that you 205 00:09:31,760 --> 00:09:33,560 Speaker 4: heard from some of the bigger banks late last week 206 00:09:33,600 --> 00:09:35,079 Speaker 4: is probably deserved and. 207 00:09:35,080 --> 00:09:39,040 Speaker 5: We should not expect or rely upon the FED to 208 00:09:39,160 --> 00:09:42,040 Speaker 5: kind of magically fix this. They can't really deal with 209 00:09:42,240 --> 00:09:45,559 Speaker 5: consumer confidence and those types of issues. 210 00:09:45,679 --> 00:09:48,080 Speaker 4: Look, we have a data driven FED, right, and I 211 00:09:48,120 --> 00:09:50,400 Speaker 4: think that there you know, let's put aside what was 212 00:09:50,440 --> 00:09:52,760 Speaker 4: going on in the bond market last week, right, but 213 00:09:53,320 --> 00:09:55,040 Speaker 4: if you if you just think about sort of the 214 00:09:55,120 --> 00:09:59,080 Speaker 4: tension between you know, inflation and the potential inflation that 215 00:09:59,120 --> 00:10:03,200 Speaker 4: may be coming from the A policy, that it's a 216 00:10:03,240 --> 00:10:05,240 Speaker 4: tough spot for them to be in that is part 217 00:10:05,240 --> 00:10:07,360 Speaker 4: of their mandate, and the labor data is holding up. 218 00:10:07,400 --> 00:10:09,280 Speaker 4: And to be honest, in everything I've read, and I've 219 00:10:09,320 --> 00:10:12,560 Speaker 4: been reading really closely across the rustle three thousands since 220 00:10:13,080 --> 00:10:15,520 Speaker 4: probably like the last two weeks of February, and I'm 221 00:10:15,559 --> 00:10:19,320 Speaker 4: not seeing a lot of alarmism on labor. We do 222 00:10:19,440 --> 00:10:21,480 Speaker 4: see it in the survey data, but in terms of 223 00:10:21,520 --> 00:10:24,120 Speaker 4: what companies are actually saying when they're going out to conferences, 224 00:10:24,120 --> 00:10:26,320 Speaker 4: when they're on earnings calls, they're not ringing the alarm 225 00:10:26,320 --> 00:10:27,240 Speaker 4: bell on labor right. 226 00:10:27,160 --> 00:10:30,800 Speaker 5: Now, even lower lower wage labor because of you know, 227 00:10:31,000 --> 00:10:33,960 Speaker 5: President Trump and his administration have been pretty effective in 228 00:10:34,080 --> 00:10:37,120 Speaker 5: kind of slowing down, if not stopping illegal immigration. Have 229 00:10:37,200 --> 00:10:39,880 Speaker 5: we seen that in the housing market in the Are 230 00:10:39,880 --> 00:10:41,200 Speaker 5: we hear in any of the agricultural world. 231 00:10:41,320 --> 00:10:43,360 Speaker 4: So I didn't read any homebuilders from like the last 232 00:10:43,400 --> 00:10:45,760 Speaker 4: week and a half, But in my last batch of reading, 233 00:10:45,800 --> 00:10:47,679 Speaker 4: I did read a couple of the homebuilders that reported 234 00:10:47,679 --> 00:10:50,199 Speaker 4: early and they specifically said they weren't seeing any kind 235 00:10:50,200 --> 00:10:53,160 Speaker 4: of derivative negative pressures on labor because of immigration. 236 00:10:53,480 --> 00:10:56,760 Speaker 2: David Sasar is north of New York City. You should 237 00:10:56,800 --> 00:10:58,600 Speaker 2: see what he's like. Eight thousand square. 238 00:10:58,720 --> 00:10:59,400 Speaker 5: Oh good for him. 239 00:11:00,280 --> 00:11:02,840 Speaker 2: The Christmas tree, it's almost as big as scarlet foods. 240 00:11:03,760 --> 00:11:03,880 Speaker 3: Yea. 241 00:11:04,080 --> 00:11:07,200 Speaker 2: Damien said, it's just booming. He said, there's absolutely no 242 00:11:07,360 --> 00:11:08,599 Speaker 2: let up whatsoever. 243 00:11:09,000 --> 00:11:11,120 Speaker 4: And look, I will say if we're thinking short term 244 00:11:11,160 --> 00:11:13,600 Speaker 4: long term, if you go back to twenty eighteen, companies 245 00:11:13,640 --> 00:11:16,040 Speaker 4: didn't really raise the alarm bell on tariffs until like 246 00:11:16,120 --> 00:11:19,360 Speaker 4: September in that conference season, before the earnings reporting season, 247 00:11:19,400 --> 00:11:21,560 Speaker 4: kind of post labor day. So it may take some 248 00:11:21,679 --> 00:11:24,760 Speaker 4: time to see the residual impacts. We are seeing in 249 00:11:24,800 --> 00:11:28,760 Speaker 4: company commentary indications of tariff pre buying. We saw one 250 00:11:28,800 --> 00:11:31,320 Speaker 4: of the banks call that out. And also you know, 251 00:11:31,679 --> 00:11:33,520 Speaker 4: some and some of my clients I met with last 252 00:11:33,559 --> 00:11:35,760 Speaker 4: week also clued me in on this. But the idea 253 00:11:35,800 --> 00:11:39,000 Speaker 4: of managing your inventories and pulling forward some of that inventory, 254 00:11:39,320 --> 00:11:41,679 Speaker 4: I would you know, we called this earning season in 255 00:11:41,720 --> 00:11:44,360 Speaker 4: our latest weekly as potentially like a box of chocolates. 256 00:11:44,360 --> 00:11:46,240 Speaker 4: We don't know exactly what we're going to get. We 257 00:11:46,280 --> 00:11:47,319 Speaker 4: could get some good ones. 258 00:11:47,440 --> 00:11:49,440 Speaker 2: You have to stop talking, But if you could just 259 00:11:49,520 --> 00:11:52,000 Speaker 2: sit there, because when you sit here, the market goes up. 260 00:11:52,320 --> 00:11:53,600 Speaker 3: Yeah, that works. 261 00:11:54,880 --> 00:11:57,480 Speaker 2: SMB Futures ninety dow p getting them ere up five 262 00:11:57,559 --> 00:11:59,960 Speaker 2: hundred and four to seventy four on a Lori Kelvin 263 00:12:00,120 --> 00:12:03,880 Speaker 2: scene of Dow Jones Industrial Average. Miss Calvacina is with 264 00:12:03,920 --> 00:12:08,000 Speaker 2: the Royal Bank of Canada RBC Capital Markets. 265 00:12:12,640 --> 00:12:16,240 Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live 266 00:12:16,280 --> 00:12:19,440 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 267 00:12:19,520 --> 00:12:23,200 Speaker 1: Applecarplay and Android Auto with the Bloomberg Business app, or 268 00:12:23,360 --> 00:12:25,079 Speaker 1: watch us live on YouTube. 269 00:12:25,600 --> 00:12:26,719 Speaker 3: We're gonna digress here. 270 00:12:26,720 --> 00:12:29,280 Speaker 2: We got too short a visit with Gargi Chowdry, but 271 00:12:29,360 --> 00:12:31,160 Speaker 2: we've got to take the time out of here because 272 00:12:31,160 --> 00:12:33,920 Speaker 2: it's a time of year where someone like me looks 273 00:12:33,920 --> 00:12:36,480 Speaker 2: out the window goes, I gotta get in shape. We 274 00:12:36,559 --> 00:12:39,360 Speaker 2: got a division here today in the studios, Folks are 275 00:12:39,480 --> 00:12:42,119 Speaker 2: wonderful studios here at Bloomberg. 276 00:12:42,320 --> 00:12:47,400 Speaker 3: Over here on the north side of the studio is the. 277 00:12:47,960 --> 00:12:52,160 Speaker 2: Out of shape Sunday. We're going to run studio. On 278 00:12:52,200 --> 00:12:55,959 Speaker 2: the other side of the studio, Lisa Matteo and Gargy 279 00:12:56,080 --> 00:12:58,120 Speaker 2: Choudry are the real deal. 280 00:12:58,520 --> 00:12:59,520 Speaker 3: Gargy, how do you. 281 00:12:59,480 --> 00:13:03,520 Speaker 2: Get moti evated to jump into the Hudson River swim five. 282 00:13:03,320 --> 00:13:07,560 Speaker 6: Miles two and a half, But I will say that 283 00:13:07,559 --> 00:13:10,920 Speaker 6: the Hudson is cleaner than its reputation has you believe. 284 00:13:12,000 --> 00:13:14,439 Speaker 5: See, but again just a whole look. 285 00:13:15,320 --> 00:13:18,280 Speaker 3: Dogs get okay, there are. 286 00:13:18,200 --> 00:13:19,439 Speaker 5: Certain people that do that stuff. 287 00:13:19,480 --> 00:13:21,360 Speaker 2: I get this some missus Keane. You got to learn 288 00:13:21,440 --> 00:13:24,400 Speaker 2: to stretch. Can you see me stretching? Lisa and Gargy, 289 00:13:24,679 --> 00:13:28,240 Speaker 2: how do you stretch? What's the most efficacious way to stretch? 290 00:13:28,920 --> 00:13:31,880 Speaker 6: Yoa glass? Yoga? 291 00:13:32,160 --> 00:13:33,160 Speaker 1: Oh there you go? 292 00:13:33,800 --> 00:13:34,440 Speaker 3: What's yoga? 293 00:13:34,679 --> 00:13:34,880 Speaker 5: Yeah? 294 00:13:35,760 --> 00:13:37,520 Speaker 3: Lisa? How do you stretch? You got to get out 295 00:13:37,520 --> 00:13:38,120 Speaker 3: of you to the body. 296 00:13:38,320 --> 00:13:40,720 Speaker 7: Do it a little pilates? Maybe I have a machine. 297 00:13:40,880 --> 00:13:43,040 Speaker 3: I have a machine too. If that Bill has it, 298 00:13:43,200 --> 00:13:45,480 Speaker 3: you know it's a dog pilates. Thank you for that. 299 00:13:45,920 --> 00:13:46,040 Speaker 6: Uh. 300 00:13:46,480 --> 00:13:47,640 Speaker 3: These two are really. 301 00:13:47,360 --> 00:13:50,240 Speaker 2: Committed to doing iron Man and triathle On and all that. 302 00:13:50,280 --> 00:13:52,600 Speaker 2: It's wonderful to see that Gurgy. I got to get 303 00:13:52,600 --> 00:13:55,199 Speaker 2: the boy market one l think out. 304 00:13:55,040 --> 00:13:56,960 Speaker 3: Making the circuit this weekend. 305 00:13:57,520 --> 00:14:00,640 Speaker 2: Explain the worry at black Rock that we hear from 306 00:14:01,040 --> 00:14:03,080 Speaker 2: Larry Fink and that we hear from Gardisha. 307 00:14:03,440 --> 00:14:05,160 Speaker 3: Color, the quality of the. 308 00:14:05,080 --> 00:14:08,560 Speaker 6: Angst, color, the quality of the angst. I love that. 309 00:14:08,720 --> 00:14:11,880 Speaker 6: So I think the best way I can speak to 310 00:14:11,920 --> 00:14:14,480 Speaker 6: it is what we saw sort of over forty eight 311 00:14:14,559 --> 00:14:17,880 Speaker 6: period where thirty treasury yields moved up by call it 312 00:14:18,200 --> 00:14:22,600 Speaker 6: seventy two basis price down, yields moved up price down, Yes, 313 00:14:22,880 --> 00:14:24,920 Speaker 6: and I think a part of that we all know 314 00:14:25,200 --> 00:14:27,160 Speaker 6: was to make room for the auction. Some of that 315 00:14:27,360 --> 00:14:30,080 Speaker 6: was the big basis unwind, it was around swap spreads. 316 00:14:30,440 --> 00:14:32,680 Speaker 6: But I do want to be very clear there was 317 00:14:32,760 --> 00:14:36,320 Speaker 6: no panic in the market. There was volumes trading. You know, 318 00:14:36,360 --> 00:14:39,040 Speaker 6: we monitor a lot what ETFs are doing as a 319 00:14:39,080 --> 00:14:41,360 Speaker 6: percentage of tape. You had a few days where et 320 00:14:41,440 --> 00:14:45,000 Speaker 6: apps were allowing to be that release valve of the market. 321 00:14:45,360 --> 00:14:49,480 Speaker 6: So yes, a big fear around what deficits might do, 322 00:14:49,560 --> 00:14:52,320 Speaker 6: which is leading to long ends moving higher. Today they 323 00:14:52,320 --> 00:14:54,360 Speaker 6: are a bit stable, but certainly that's been the price 324 00:14:54,400 --> 00:14:56,640 Speaker 6: action for long end which is why we think the 325 00:14:56,680 --> 00:14:59,760 Speaker 6: belly of the curve still offers you better value at 326 00:14:59,800 --> 00:15:05,200 Speaker 6: the same time, not panicked move. There's still risk changing hands. 327 00:15:05,240 --> 00:15:07,400 Speaker 6: I think that's really important for all your listeners to 328 00:15:07,400 --> 00:15:07,880 Speaker 6: be aware of. 329 00:15:08,080 --> 00:15:12,440 Speaker 5: So just broadly speaking in terms across all of your portfolio, 330 00:15:12,440 --> 00:15:14,520 Speaker 5: I mean black Rock's got a couple of dollars under management. 331 00:15:14,760 --> 00:15:18,520 Speaker 5: We understand that. How do you guys internally when you 332 00:15:18,560 --> 00:15:21,240 Speaker 5: sit down and have your meetings, say, what are we 333 00:15:21,280 --> 00:15:24,240 Speaker 5: going to do this week? Is realistically, we have no 334 00:15:24,360 --> 00:15:26,560 Speaker 5: idea what's going to come out of the White House 335 00:15:26,600 --> 00:15:29,280 Speaker 5: which will whipsaw markets? How do you guys have black 336 00:15:29,360 --> 00:15:30,720 Speaker 5: Rock kind of think about that. 337 00:15:30,800 --> 00:15:32,960 Speaker 6: Yeah, So you know, we have a lot of internal 338 00:15:32,960 --> 00:15:35,840 Speaker 6: meetings as you point out, and senior investors get together 339 00:15:35,920 --> 00:15:37,840 Speaker 6: and talk about what they're seeing in their corner of 340 00:15:37,880 --> 00:15:40,040 Speaker 6: the markets. And I think one of the things that 341 00:15:40,120 --> 00:15:43,280 Speaker 6: everyone's trying to do is separate the signal from the noise. 342 00:15:43,760 --> 00:15:48,240 Speaker 6: So there obviously has been some noise around, especially this weekend, 343 00:15:48,280 --> 00:15:51,880 Speaker 6: around some exceptions perhaps and then some tweets around maybe 344 00:15:51,880 --> 00:15:54,320 Speaker 6: those exceptions are not exactly what we first not them 345 00:15:54,360 --> 00:15:57,960 Speaker 6: to be. But taking a giant step back coming into 346 00:15:58,000 --> 00:16:00,680 Speaker 6: the cl what was the tariff rate and what do 347 00:16:00,720 --> 00:16:03,320 Speaker 6: we think projections for tariff rates are going to be 348 00:16:03,520 --> 00:16:06,760 Speaker 6: in the next few months. Looking at the soft versus 349 00:16:06,760 --> 00:16:10,200 Speaker 6: the hard data, obviously soft data a little bit worrisome. 350 00:16:10,280 --> 00:16:13,640 Speaker 6: We saw that Michigan softening again and inflation picking up 351 00:16:13,640 --> 00:16:16,920 Speaker 6: pretty meaningfully in the Michigan five to tenure inflation expectations, 352 00:16:17,120 --> 00:16:19,320 Speaker 6: but at the same time in the herd data you 353 00:16:19,600 --> 00:16:22,760 Speaker 6: have not yet seen. Any of the concerns are on 354 00:16:22,880 --> 00:16:26,800 Speaker 6: rising inflation and slowing growth. So recognizing both of those 355 00:16:26,920 --> 00:16:30,120 Speaker 6: and most importantly telling our clients what to do. That's 356 00:16:30,160 --> 00:16:35,120 Speaker 6: our role. Telling clients stay invested, add some diversifiers, add 357 00:16:35,200 --> 00:16:38,280 Speaker 6: some hedges, clip some coupons, and the fixed and come markets. 358 00:16:38,440 --> 00:16:41,640 Speaker 2: What do you do with cash? Do you increase cash? 359 00:16:42,320 --> 00:16:45,720 Speaker 2: Do you wait with cash? I mean to me, you know, 360 00:16:45,760 --> 00:16:48,320 Speaker 2: to our listeners and viewers. That's a key key question. 361 00:16:48,160 --> 00:16:50,200 Speaker 6: Here, Tom great question when we. 362 00:16:50,160 --> 00:16:52,920 Speaker 3: Think, yeah, this is it, I'm going home. 363 00:16:53,120 --> 00:16:56,720 Speaker 6: Cash has seen a lot of inflows. SGOV, which is 364 00:16:56,800 --> 00:17:00,400 Speaker 6: our t bill sort of ETF, has seen the most 365 00:17:00,400 --> 00:17:04,800 Speaker 6: amount of inflos. It's one of the highest gathering asset 366 00:17:04,840 --> 00:17:09,280 Speaker 6: classes this year. So investors are thinking about cash as 367 00:17:09,280 --> 00:17:11,879 Speaker 6: an asset class. I think we need to recognize that 368 00:17:11,920 --> 00:17:16,200 Speaker 6: there continues to be a role for things like SGOV 369 00:17:16,280 --> 00:17:19,480 Speaker 6: in your portfolio. But what we're telling investors is also 370 00:17:19,640 --> 00:17:23,320 Speaker 6: think of opportunities to you sort of look at areas 371 00:17:23,320 --> 00:17:25,240 Speaker 6: of the market that have had perhaps too much of 372 00:17:25,280 --> 00:17:29,120 Speaker 6: a correction. We're telling investors add some minimum volatility, add 373 00:17:29,200 --> 00:17:32,800 Speaker 6: some gold, think of areas to buy quality technology, in 374 00:17:32,840 --> 00:17:34,159 Speaker 6: your portfolio. 375 00:17:34,200 --> 00:17:35,800 Speaker 3: So longer term. 376 00:17:35,880 --> 00:17:38,400 Speaker 5: I mean again, the administration is promising perhaps some near 377 00:17:38,480 --> 00:17:40,920 Speaker 5: term pain for some longer term gain in terms of 378 00:17:40,960 --> 00:17:46,280 Speaker 5: productivity investment. Is that something you can think about or 379 00:17:46,320 --> 00:17:47,760 Speaker 5: is it just trying to deal with the day. 380 00:17:47,640 --> 00:17:50,800 Speaker 6: To day No, absolutely, that's the job trying to think about. 381 00:17:50,840 --> 00:17:52,960 Speaker 6: Like I said, what is the signal versus what is 382 00:17:53,000 --> 00:17:56,000 Speaker 6: the noise in the future? Is the signal towards a 383 00:17:56,080 --> 00:17:58,919 Speaker 6: more productive world in the future. Are we going to 384 00:17:59,000 --> 00:18:02,000 Speaker 6: get to a point where we can point to higher 385 00:18:02,040 --> 00:18:04,320 Speaker 6: growth as a result of all of the noise that 386 00:18:04,359 --> 00:18:06,520 Speaker 6: we might be getting today. I think it's a little 387 00:18:06,560 --> 00:18:09,399 Speaker 6: too early to tell. I'm looking at price action in 388 00:18:09,440 --> 00:18:12,040 Speaker 6: the markets now, and I'm very relieved to see that 389 00:18:12,119 --> 00:18:16,120 Speaker 6: bond markets are behaving in a pretty normalized manner, which 390 00:18:16,160 --> 00:18:19,040 Speaker 6: gives us a little bit of confidence in where equities 391 00:18:19,040 --> 00:18:19,360 Speaker 6: can go. 392 00:18:19,320 --> 00:18:20,960 Speaker 2: To the Okay, this is Keith, thank you for bringing 393 00:18:21,000 --> 00:18:23,119 Speaker 2: us up. I've got a whole set of things. I 394 00:18:23,160 --> 00:18:25,920 Speaker 2: look at some of them pretty esoteric. I look at 395 00:18:25,920 --> 00:18:28,320 Speaker 2: libr or ois a new and SO for ten year. 396 00:18:28,720 --> 00:18:32,639 Speaker 2: Damien Sasauer looks at SO for two year. They're behaving well. 397 00:18:32,720 --> 00:18:36,359 Speaker 2: This morning, Sweeney's brilliant. He looks at the TUESDA ten spread. 398 00:18:36,400 --> 00:18:40,239 Speaker 2: What does Gargie Chowdery suggest we should look at to 399 00:18:40,280 --> 00:18:42,640 Speaker 2: say the bond market's deteriorating? 400 00:18:42,920 --> 00:18:44,159 Speaker 3: The bond market's. 401 00:18:43,800 --> 00:18:46,520 Speaker 6: Okay, yeah, absolutely, so I would say look at what 402 00:18:46,720 --> 00:18:49,639 Speaker 6: on the run versus off the run treasuries are doing. 403 00:18:49,720 --> 00:18:52,640 Speaker 6: So how much are off the runs getting? You know, 404 00:18:53,119 --> 00:18:55,600 Speaker 6: how much illiquidity is there in the markets. That's one 405 00:18:55,600 --> 00:18:58,159 Speaker 6: thing I would look at the repo markets is are 406 00:18:58,200 --> 00:19:01,400 Speaker 6: the repo markets functioning proper? Is there any squeeze? 407 00:19:02,240 --> 00:19:04,919 Speaker 2: Okay, we're hearing from Irish Jersey when he's not watching 408 00:19:04,920 --> 00:19:08,120 Speaker 2: aston Vila that the repo market is functioning properly. 409 00:19:08,200 --> 00:19:10,320 Speaker 3: Do you agree as of right now? 410 00:19:10,359 --> 00:19:13,720 Speaker 6: Absolutely, the repot markets are functioning properly. And I think 411 00:19:13,800 --> 00:19:16,840 Speaker 6: that's one of the reasons why we haven't found this 412 00:19:16,960 --> 00:19:20,280 Speaker 6: move over the last week to be panic inducing. 413 00:19:20,400 --> 00:19:23,240 Speaker 2: Paul panic inducing. You just gave Paul panic. He thought 414 00:19:23,359 --> 00:19:25,040 Speaker 2: he's going to get his vesper repod. 415 00:19:25,320 --> 00:19:25,560 Speaker 3: Yes. 416 00:19:26,080 --> 00:19:29,040 Speaker 2: The answer to repel market, folks, is short, short term paper. 417 00:19:29,359 --> 00:19:32,480 Speaker 2: I call it the trust market. It's wrapped around lots 418 00:19:32,480 --> 00:19:35,480 Speaker 2: of It's there on the bt M M screen of Bloomberg, 419 00:19:35,760 --> 00:19:37,840 Speaker 2: and I no I Mike came up to me. He 420 00:19:37,880 --> 00:19:39,560 Speaker 2: said to me once he is, do you have any 421 00:19:39,640 --> 00:19:43,120 Speaker 2: idea what one single statistic is on the bt MM 422 00:19:43,200 --> 00:19:47,399 Speaker 2: screen is no, No, mister treasure money markets, I don't gargy. 423 00:19:47,520 --> 00:19:50,920 Speaker 2: Thank you so much, particularly for the what's the key 424 00:19:50,960 --> 00:19:54,159 Speaker 2: thing with yoga like in Heal Deep? What's what's this 425 00:19:54,240 --> 00:19:57,760 Speaker 2: thing called on radio? 426 00:19:58,200 --> 00:19:59,800 Speaker 3: What? What's this thing called? 427 00:20:00,000 --> 00:20:02,199 Speaker 7: I think you're trying to do the mountain post? Is 428 00:20:02,240 --> 00:20:03,120 Speaker 7: that what's happening? 429 00:20:03,200 --> 00:20:04,760 Speaker 6: I think Doom's doing the Mountain tors. 430 00:20:04,840 --> 00:20:08,199 Speaker 3: We're play Mountains. The next song out Leslie West, Get prepared, 431 00:20:08,240 --> 00:20:11,600 Speaker 3: Gardi Showbery. Thank you so much, greatly, greatly appreciate it. 432 00:20:12,480 --> 00:20:16,400 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 433 00:20:16,440 --> 00:20:19,720 Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto 434 00:20:19,840 --> 00:20:22,800 Speaker 1: with the Bloomberg Business App. You can also listen live 435 00:20:22,880 --> 00:20:26,480 Speaker 1: on Amazon Alexa from our flagship New York station, Just 436 00:20:26,520 --> 00:20:30,360 Speaker 1: say Alexa play Bloomberg eleven thirty Trust Company. 437 00:20:30,040 --> 00:20:33,960 Speaker 2: The West is TCW, and they have all sorts of 438 00:20:34,600 --> 00:20:37,879 Speaker 2: wonderful people. We can literally the quality is so good, 439 00:20:38,480 --> 00:20:41,040 Speaker 2: like they're good competitor in La Capitol Group that we 440 00:20:41,040 --> 00:20:45,240 Speaker 2: can take anybody blind any time. Penny Foley is flat 441 00:20:45,240 --> 00:20:49,000 Speaker 2: out a legend out of TCW in emerging markets and 442 00:20:49,119 --> 00:20:52,480 Speaker 2: joins US. Right now, You've aged after last. 443 00:20:52,200 --> 00:20:56,600 Speaker 3: Week, you and I have never seen this. 444 00:20:56,720 --> 00:20:59,240 Speaker 2: I mean, you go back to Ecuador, you go back 445 00:20:59,280 --> 00:21:02,280 Speaker 2: Carl Weinberg's Lehman, you go back to the financial crisis 446 00:21:02,640 --> 00:21:05,040 Speaker 2: ninety eight. You could feel the sweat on the beach. 447 00:21:05,400 --> 00:21:07,800 Speaker 3: All the others. This is unique. Why is it unique 448 00:21:07,840 --> 00:21:08,680 Speaker 3: for Pennyfolio? 449 00:21:09,119 --> 00:21:13,200 Speaker 8: It's it's uh, you know, the uncertainty factor is huge, uh, 450 00:21:13,280 --> 00:21:17,720 Speaker 8: and that means that you've got to have higher you know, 451 00:21:17,800 --> 00:21:23,399 Speaker 8: higher risk premia. There is an absolute surprise at you know, 452 00:21:23,440 --> 00:21:26,879 Speaker 8: at every level. You know, I think EM growth is 453 00:21:26,920 --> 00:21:30,399 Speaker 8: really fit facing multiple shocks, you know, uncertainty, which has 454 00:21:30,600 --> 00:21:34,880 Speaker 8: had an impact on you know, business and consumer uh 455 00:21:34,920 --> 00:21:38,119 Speaker 8: decline and realed income, supply chain disruptions and you know, 456 00:21:38,160 --> 00:21:41,560 Speaker 8: and really a huge negative wealth effect. You know. For 457 00:21:41,600 --> 00:21:43,760 Speaker 8: the rest of the world, it's been more of a 458 00:21:43,760 --> 00:21:47,520 Speaker 8: straightforward demand shock. So I think the downward pressure on 459 00:21:47,680 --> 00:21:51,040 Speaker 8: US growth, all other things being equal, is estimated. It's 460 00:21:51,080 --> 00:21:53,760 Speaker 8: sort of one to two percentage points for the next 461 00:21:54,280 --> 00:21:56,960 Speaker 8: four quarters. The impact on the rest of the world 462 00:21:57,480 --> 00:22:01,680 Speaker 8: x China is probably only half that. And you said 463 00:22:01,720 --> 00:22:04,960 Speaker 8: earlier central banks have the ability to cut rates in 464 00:22:05,080 --> 00:22:09,080 Speaker 8: EM and also provide some fiscal UH stimulus. You know, 465 00:22:09,119 --> 00:22:13,120 Speaker 8: I think the differentiation in EM is going to be key. Obviously, 466 00:22:13,240 --> 00:22:18,320 Speaker 8: oil exporters are going to be hurt. Importers with relatively 467 00:22:18,359 --> 00:22:20,440 Speaker 8: closed economies, they're going to do a whole lot better. 468 00:22:20,960 --> 00:22:21,119 Speaker 3: You know. 469 00:22:21,160 --> 00:22:25,000 Speaker 8: What we did was essentially re underwritten every high yield 470 00:22:25,359 --> 00:22:29,280 Speaker 8: position in the portfolio to identify those that will face 471 00:22:29,320 --> 00:22:32,160 Speaker 8: a higher default risk in the current environment. 472 00:22:32,440 --> 00:22:34,080 Speaker 7: And we've used kind of the baby with. 473 00:22:34,040 --> 00:22:36,679 Speaker 8: The Bathwater sell off in the course of the last 474 00:22:37,240 --> 00:22:40,960 Speaker 8: ten days to pick up select names that seem significantly 475 00:22:41,040 --> 00:22:50,240 Speaker 8: under sold UH, mostly corporates, small corporates, but were very, 476 00:22:50,400 --> 00:22:52,920 Speaker 8: very cautious because I think the you know, the technicals 477 00:22:52,960 --> 00:22:54,960 Speaker 8: are still really pretty challenging, and a lot of the 478 00:22:54,960 --> 00:22:57,159 Speaker 8: cell side have been told to away from it. 479 00:23:00,240 --> 00:23:04,120 Speaker 2: I could clients for TCWS listen to this, I can 480 00:23:04,160 --> 00:23:07,280 Speaker 2: ignore I have every years. 481 00:23:07,200 --> 00:23:13,199 Speaker 5: Penny from your perspective in emerging markets? Is US economic exceptionalism? 482 00:23:13,840 --> 00:23:14,480 Speaker 3: Is that over? 483 00:23:15,119 --> 00:23:17,280 Speaker 8: You know, it's it's a it's a great question. I mean, 484 00:23:17,280 --> 00:23:19,200 Speaker 8: I think you've I heard you a little earlier saying 485 00:23:19,200 --> 00:23:22,640 Speaker 8: that you know, the US. You know, markets last week 486 00:23:22,680 --> 00:23:26,280 Speaker 8: were very unusually so yields up, on prices down, currency 487 00:23:26,359 --> 00:23:30,119 Speaker 8: was weaker, stock flower you know, that usually spells capital outflows, 488 00:23:30,560 --> 00:23:34,679 Speaker 8: and it's pretty common in emerging markets. You know, in 489 00:23:34,720 --> 00:23:37,960 Speaker 8: the case of the US, you've seen that happen maybe 490 00:23:38,000 --> 00:23:40,159 Speaker 8: just a handful of times in the last thirty years. 491 00:23:40,640 --> 00:23:43,040 Speaker 8: And you know, and as you both know, foreigners owned 492 00:23:43,080 --> 00:23:45,160 Speaker 8: about a third of the US treasuring market. They own 493 00:23:45,240 --> 00:23:48,760 Speaker 8: twenty five percent of US corporate bonds and close to 494 00:23:49,000 --> 00:23:53,360 Speaker 8: twenty percent of equity, So the potential for outflows is 495 00:23:53,400 --> 00:23:56,879 Speaker 8: not inconsiderate, you know, inconsiderable. You know, the erosion of 496 00:23:56,920 --> 00:24:00,920 Speaker 8: social and political norms and loss of trust could pose 497 00:24:01,119 --> 00:24:03,560 Speaker 8: longer term issues for the US, but you know, in 498 00:24:03,560 --> 00:24:06,720 Speaker 8: my view, it's probably just at the margin at this point. 499 00:24:06,840 --> 00:24:10,880 Speaker 8: I mean, they're just too many factors that support US dominance, 500 00:24:10,920 --> 00:24:15,560 Speaker 8: and it's you know, it's entrepreneurial culture, technological and you know, 501 00:24:15,640 --> 00:24:19,360 Speaker 8: in scientific advances, flexible label markets, and just the sheer size, 502 00:24:19,800 --> 00:24:23,159 Speaker 8: you know, and depth of our capital markets. But no question, 503 00:24:23,680 --> 00:24:26,399 Speaker 8: the narrative around US exceptionalism has lost a bit of 504 00:24:26,440 --> 00:24:29,359 Speaker 8: its steam in the last couple of. 505 00:24:30,000 --> 00:24:33,199 Speaker 5: Where do you see value out there these days? In 506 00:24:33,240 --> 00:24:36,040 Speaker 5: your world of emerging markets? I wouldn't even know how 507 00:24:36,040 --> 00:24:40,040 Speaker 5: to look or value or characterize value. But where do 508 00:24:40,080 --> 00:24:41,879 Speaker 5: you guys see opportunities these days? 509 00:24:41,920 --> 00:24:48,040 Speaker 8: You know what's interesting in in EM You've seen UH 510 00:24:48,520 --> 00:24:53,600 Speaker 8: outperformance relative to the developed world, to the US, So 511 00:24:53,640 --> 00:24:56,439 Speaker 8: somebody's seeing value somewhere, and I think they're you know, 512 00:24:56,800 --> 00:25:00,679 Speaker 8: on average, UH, you've seen EM spreads outperform U US peers. 513 00:25:00,960 --> 00:25:04,760 Speaker 8: And this compression is at every at every rating level. 514 00:25:05,280 --> 00:25:07,040 Speaker 8: So there are a couple of reasons for that. You know, 515 00:25:07,200 --> 00:25:10,840 Speaker 8: most EM sovereigns are in the early to mid stage 516 00:25:10,840 --> 00:25:13,439 Speaker 8: of the credit cycle, having gone through, you know, a 517 00:25:13,440 --> 00:25:17,720 Speaker 8: pretty big restructuring and default cycle in twenty one twenty two. 518 00:25:18,920 --> 00:25:22,520 Speaker 8: Also since the Taper tantrum, you know, a number of 519 00:25:22,760 --> 00:25:26,399 Speaker 8: EM sovereigns have undertaken pretty broad based structural reform. So 520 00:25:26,440 --> 00:25:30,639 Speaker 8: that makes them, you know, resilient or more resilient in 521 00:25:31,040 --> 00:25:32,320 Speaker 8: an external volatility. 522 00:25:32,680 --> 00:25:32,879 Speaker 3: You know. 523 00:25:32,920 --> 00:25:35,560 Speaker 8: And in fact, this year or last year, you saw 524 00:25:36,280 --> 00:25:42,040 Speaker 8: positive BM rating changes exceed negative ones retiring, you know, 525 00:25:42,080 --> 00:25:44,040 Speaker 8: for the first time in you know, in a decade. 526 00:25:44,720 --> 00:25:46,359 Speaker 2: With the time we got left, I gotta ask you 527 00:25:46,400 --> 00:25:49,320 Speaker 2: about la mister Ahmanson was one of my first supporters 528 00:25:49,320 --> 00:25:52,000 Speaker 2: in doing this act years ago. The Cross Company to 529 00:25:52,000 --> 00:25:55,080 Speaker 2: the West goes back to mister Day in nineteen seventy one, 530 00:25:55,640 --> 00:25:58,440 Speaker 2: is well, you're a pillar out there with the La 531 00:25:58,480 --> 00:26:02,080 Speaker 2: Opera and all house laws angels doing after the fire. 532 00:26:02,760 --> 00:26:05,439 Speaker 8: You know, I think the fire obviously was was a 533 00:26:05,640 --> 00:26:10,919 Speaker 8: huge issue. And and you know what is astounded me 534 00:26:11,280 --> 00:26:16,280 Speaker 8: is how quickly people came together as a community to rebuild. 535 00:26:17,600 --> 00:26:21,400 Speaker 8: And uh, you know TCW, for example, was absolutely extraordinary. 536 00:26:21,400 --> 00:26:23,560 Speaker 8: There are a number of people that lost their homes 537 00:26:24,000 --> 00:26:29,480 Speaker 8: at TCURE, including our our CEO, and and they came 538 00:26:29,520 --> 00:26:33,640 Speaker 8: together to really you know, support employees. We all came 539 00:26:33,680 --> 00:26:36,440 Speaker 8: into the office. There was you know, nobody said life 540 00:26:36,520 --> 00:26:37,920 Speaker 8: is you know, life is too short. 541 00:26:38,760 --> 00:26:40,240 Speaker 7: There was just a real great. 542 00:26:40,000 --> 00:26:43,280 Speaker 8: Sense of community, probably more so than you've seen in 543 00:26:43,440 --> 00:26:44,120 Speaker 8: Los Angeles. 544 00:26:44,119 --> 00:26:46,480 Speaker 2: For what's the number one thing the East Coast gets 545 00:26:46,520 --> 00:26:50,280 Speaker 2: wrong about the larger LA experiment. I'm sitting on Sunset 546 00:26:50,320 --> 00:26:53,640 Speaker 2: Boulevard going this place is rocket with all the gloom 547 00:26:53,680 --> 00:26:56,760 Speaker 2: and all that. What's the number one thing East Coast 548 00:26:56,800 --> 00:26:58,480 Speaker 2: idiots get wrong about LA? 549 00:26:58,600 --> 00:26:58,760 Speaker 3: Oh? 550 00:26:58,800 --> 00:27:00,520 Speaker 8: I think they you know, they look at at l 551 00:27:00,600 --> 00:27:02,760 Speaker 8: A and say, well, you know it's a soft you know, 552 00:27:04,080 --> 00:27:08,320 Speaker 8: kind of you know, not so serious. 553 00:27:08,040 --> 00:27:11,280 Speaker 7: You mean coast, Okay, so serious the place. 554 00:27:11,400 --> 00:27:14,359 Speaker 8: It is a serious place. I mean, no question when 555 00:27:14,400 --> 00:27:16,119 Speaker 8: I get on a plane to come to the East Coast, 556 00:27:16,280 --> 00:27:19,040 Speaker 8: I get all repped up when I you know, going 557 00:27:19,119 --> 00:27:21,760 Speaker 8: out to Los Angeles. You know, I saw you know, 558 00:27:21,800 --> 00:27:23,679 Speaker 8: it's going to be quieter, it's going to be but 559 00:27:23,760 --> 00:27:25,639 Speaker 8: it's it's a you know a lot of people in 560 00:27:25,760 --> 00:27:28,320 Speaker 8: on the West Coast have come from the East Coast. 561 00:27:28,400 --> 00:27:34,160 Speaker 8: There's a very vibrant industry away from away from the 562 00:27:34,359 --> 00:27:37,240 Speaker 8: you know, the movie industry, and the movie industry itself 563 00:27:37,320 --> 00:27:40,399 Speaker 8: is driving a lot of innovation and change. So I 564 00:27:40,440 --> 00:27:41,600 Speaker 8: think it's a very exciting. 565 00:27:42,080 --> 00:27:44,840 Speaker 2: Thank you so much for visiting pennyfolio with us, I 566 00:27:44,960 --> 00:27:47,359 Speaker 2: kind of get TCW and of course with the Emerging 567 00:27:47,480 --> 00:27:48,120 Speaker 2: Markets Group. 568 00:27:52,840 --> 00:27:56,719 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 569 00:27:56,800 --> 00:27:59,720 Speaker 1: starting at seven am Eastern on applecar Play and Android 570 00:27:59,760 --> 00:28:02,800 Speaker 1: Ato with the Bloomberg Business app. You can also watch 571 00:28:02,920 --> 00:28:05,840 Speaker 1: us live every weekday on YouTube and always on the 572 00:28:05,880 --> 00:28:06,960 Speaker 1: Bloomberg terminal. 573 00:28:07,440 --> 00:28:09,400 Speaker 3: This is way cool. Plus RENI in time came. 574 00:28:09,440 --> 00:28:13,680 Speaker 2: We welcome all of you extended conversation now with Henrietta Treys. 575 00:28:14,240 --> 00:28:18,200 Speaker 2: She's killing it in Washington, discussing this moment we're all 576 00:28:18,240 --> 00:28:20,120 Speaker 2: living and you wonder. 577 00:28:19,800 --> 00:28:22,800 Speaker 3: Where it came from? Well, inter ute. 578 00:28:23,520 --> 00:28:27,239 Speaker 2: She worked for Marty's Wags Wagged Demnum and before that 579 00:28:28,000 --> 00:28:31,040 Speaker 2: she worked for somebody of all respect across the aisle, 580 00:28:31,160 --> 00:28:35,280 Speaker 2: Joseph Crowley, Joe Crowley, a Democrat from New York. Henrietta 581 00:28:35,320 --> 00:28:38,320 Speaker 2: Trees and studio here in New York. What was it 582 00:28:38,560 --> 00:28:42,200 Speaker 2: like working for Joe Crowley? And where are the Joe 583 00:28:42,280 --> 00:28:43,400 Speaker 2: Crowley's today? 584 00:28:43,880 --> 00:28:45,480 Speaker 3: To say? The Democratic Party? 585 00:28:45,760 --> 00:28:47,120 Speaker 7: Oh, it was so great. 586 00:28:47,600 --> 00:28:51,520 Speaker 9: Some of my most incredible, impressive memories are from the 587 00:28:51,560 --> 00:28:54,120 Speaker 9: folks I met there, Kevin Casey, Greg Shiowitz. 588 00:28:54,560 --> 00:28:59,479 Speaker 2: There's a crimal scream, including from Republicans Democrats, find your 589 00:28:59,560 --> 00:29:00,840 Speaker 2: inner Crowley? 590 00:29:01,320 --> 00:29:02,720 Speaker 3: Where is it? 591 00:29:02,720 --> 00:29:05,760 Speaker 9: It is searching for an issue that they can seize 592 00:29:05,800 --> 00:29:08,280 Speaker 9: on to unite them. I will say I notice a 593 00:29:08,320 --> 00:29:10,520 Speaker 9: lot of that with the Ways and Means Committee chiefs 594 00:29:10,560 --> 00:29:13,440 Speaker 9: of Staff right now around the issue of pharmaceutical tariffs. 595 00:29:13,720 --> 00:29:16,920 Speaker 9: The Democratic Party has a real choke hold on the 596 00:29:16,960 --> 00:29:19,640 Speaker 9: topic of healthcare in this country. And so as the 597 00:29:19,640 --> 00:29:22,200 Speaker 9: President starts to migrate into the section two thirty two 598 00:29:22,200 --> 00:29:25,720 Speaker 9: on pharmaceutical tariffs. I think the Democratic Party will really 599 00:29:25,720 --> 00:29:27,360 Speaker 9: start to coalesce and we'll see that. 600 00:29:27,400 --> 00:29:29,440 Speaker 2: Well, she's the only one I know before eight am 601 00:29:29,760 --> 00:29:33,719 Speaker 2: that can talk stuff. 602 00:29:34,480 --> 00:29:37,600 Speaker 5: So, Henriette, what's the what's the next? I know Congress 603 00:29:37,680 --> 00:29:40,840 Speaker 5: is out for another recess. I don't know how they happen. 604 00:29:41,520 --> 00:29:45,040 Speaker 5: They seem to have more recesses than anybody. But what's 605 00:29:45,120 --> 00:29:47,320 Speaker 5: the to do list over the next couple of weeks 606 00:29:47,680 --> 00:29:49,000 Speaker 5: that's really going to be impactful. 607 00:29:49,240 --> 00:29:50,840 Speaker 9: There's only one to do list, and that's get the 608 00:29:50,880 --> 00:29:54,120 Speaker 9: tax bill written. I think it's going to take until 609 00:29:54,160 --> 00:29:56,720 Speaker 9: the end of the July recess, which is July twenty fourth. 610 00:29:56,720 --> 00:29:58,200 Speaker 9: So if you want to like circle a date on 611 00:29:58,240 --> 00:30:00,880 Speaker 9: your calendar for when this whole thing could pass, that's 612 00:30:00,920 --> 00:30:04,000 Speaker 9: my base case expectation. It's going to be a really 613 00:30:04,040 --> 00:30:05,800 Speaker 9: tough road from here. But I do not buy the 614 00:30:05,880 --> 00:30:08,960 Speaker 9: narrative that somehow the Freedom Caucus is going to vote 615 00:30:09,000 --> 00:30:11,840 Speaker 9: against a tax increase on all Americans. As y'all know, 616 00:30:12,080 --> 00:30:14,120 Speaker 9: this is not a tax cut. There's very little that's 617 00:30:14,160 --> 00:30:16,480 Speaker 9: stimulative from this bill. But there's no way that you 618 00:30:16,560 --> 00:30:19,520 Speaker 9: vote to raise tax rates on every single income bracket. 619 00:30:19,520 --> 00:30:21,560 Speaker 9: Maybe if you maybe you do the sea salt, the 620 00:30:21,600 --> 00:30:24,400 Speaker 9: corporate solid rate, maybe you raise the millionaire tax. 621 00:30:25,080 --> 00:30:27,200 Speaker 7: But other than that, you've got to vote for this bill. 622 00:30:27,640 --> 00:30:30,280 Speaker 5: So you have to vote for this bill. And is 623 00:30:30,440 --> 00:30:34,000 Speaker 5: President Trump, I mean, his obviously his sway over his party, 624 00:30:34,200 --> 00:30:37,720 Speaker 5: his sway over Congress seems extraordinarily strong at the moment. 625 00:30:39,160 --> 00:30:41,160 Speaker 5: Is that a time for him to push through everything 626 00:30:41,200 --> 00:30:44,400 Speaker 5: he wants? Because is this something that may not last 627 00:30:44,400 --> 00:30:44,960 Speaker 5: four years? 628 00:30:45,200 --> 00:30:45,640 Speaker 7: Exactly? 629 00:30:45,720 --> 00:30:48,360 Speaker 9: And that's that's my base case expectation. Same as it 630 00:30:48,440 --> 00:30:49,960 Speaker 9: was during the first term. You get one year in 631 00:30:50,000 --> 00:30:52,200 Speaker 9: a pass legislation, and then the next three are all 632 00:30:52,360 --> 00:30:54,640 Speaker 9: voted to tariffs. The difference now is that he gets 633 00:30:54,680 --> 00:30:56,840 Speaker 9: all four years for tariffs, one year for a taxi. 634 00:30:56,960 --> 00:31:01,040 Speaker 2: You'veon stenus with an incredibly important ft. Yes, say this weekend, 635 00:31:01,120 --> 00:31:03,720 Speaker 2: mister von stein Is will join us next week. I 636 00:31:03,800 --> 00:31:06,320 Speaker 2: believe that you know dark in the door here in 637 00:31:06,360 --> 00:31:09,920 Speaker 2: New York where he hearkens the madness. Now back to 638 00:31:10,080 --> 00:31:12,720 Speaker 2: Nixon nineteen seventy one. I'm the only one east to 639 00:31:12,720 --> 00:31:16,000 Speaker 2: the Mississippi River that remembers that. And the answers to 640 00:31:16,000 --> 00:31:19,000 Speaker 2: annery Horden will speak with the Secretary of Treasure or 641 00:31:19,360 --> 00:31:23,680 Speaker 2: Treasury today. He's had a pretty good weekend distancing himself 642 00:31:24,000 --> 00:31:26,760 Speaker 2: from the rest of the Trump mob. What will you 643 00:31:26,960 --> 00:31:29,640 Speaker 2: listen for from the Secretary of Treasury today? 644 00:31:29,880 --> 00:31:32,520 Speaker 9: Yeah, the street is definitely hoping that Scott Bessett is 645 00:31:32,600 --> 00:31:34,239 Speaker 9: the calm voice in the room. I think they've been 646 00:31:34,240 --> 00:31:37,520 Speaker 9: trying to elevate that potentiality and you've seen it, you know, 647 00:31:37,560 --> 00:31:41,120 Speaker 9: whether it's knives out for Howard Lutnik or distancing themselves 648 00:31:41,160 --> 00:31:43,240 Speaker 9: from the Peter Navarros and Kevin Hassetts of the world. 649 00:31:43,360 --> 00:31:45,880 Speaker 9: From Treasury Secretary Bessett, you want to see, I want 650 00:31:45,920 --> 00:31:49,280 Speaker 9: to see some detailed conversations about exactly what nations are 651 00:31:49,320 --> 00:31:52,880 Speaker 9: being negotiated with first, some sequencing, you know, Vietnam in 652 00:31:52,880 --> 00:31:54,480 Speaker 9: any fine Vietnam. 653 00:31:54,920 --> 00:31:59,400 Speaker 2: She is flying into Vietnam today, I believe, are you 654 00:31:59,520 --> 00:32:02,400 Speaker 2: kidding me? What is the incentive for these people to 655 00:32:02,560 --> 00:32:06,720 Speaker 2: negotiate with a vacillating White House? I mean, I love 656 00:32:07,680 --> 00:32:11,600 Speaker 2: Jill Malwak this morning, X in Paris has a great code. 657 00:32:11,600 --> 00:32:12,960 Speaker 2: If I can find it, I'm not going to be 658 00:32:13,000 --> 00:32:15,959 Speaker 2: able to find it now. But basically, he says, this 659 00:32:16,160 --> 00:32:19,800 Speaker 2: vain moment, how do they negotiate. 660 00:32:19,600 --> 00:32:22,320 Speaker 7: And what are you even negotiating exactly? You want to 661 00:32:22,320 --> 00:32:22,760 Speaker 7: bring the tires? 662 00:32:22,920 --> 00:32:25,640 Speaker 9: We're one and a half percent to zero percent. Yeah, 663 00:32:25,800 --> 00:32:28,560 Speaker 9: I don't think that there's anything. 664 00:32:28,120 --> 00:32:30,520 Speaker 7: Real to be gleaned from a negotiation with them. 665 00:32:30,680 --> 00:32:32,719 Speaker 9: I think the street wants to hear it, and frankly, 666 00:32:32,760 --> 00:32:35,160 Speaker 9: i'd like Secretary best and to get very specific. We've 667 00:32:35,160 --> 00:32:38,440 Speaker 9: had enough of these like really broad statements about the 668 00:32:38,480 --> 00:32:42,520 Speaker 9: whole semiconductor industry is excluded. Okay, let's talk about the 669 00:32:42,560 --> 00:32:46,040 Speaker 9: actual magnets from China, the critical minerals, right, what's going 670 00:32:46,080 --> 00:32:46,440 Speaker 9: into what? 671 00:32:46,680 --> 00:32:48,640 Speaker 7: Where are the cargo ships? Are they being hauled up 672 00:32:48,640 --> 00:32:51,080 Speaker 7: at the at the ocean level? You know, when are 673 00:32:51,080 --> 00:32:51,720 Speaker 7: they going to be off there? 674 00:32:51,760 --> 00:32:53,600 Speaker 3: And Paul, you miss this? You're at the masters. I 675 00:32:53,600 --> 00:32:56,600 Speaker 3: mean I can understand you missed it. Magnets, I mean 676 00:32:56,600 --> 00:32:57,360 Speaker 3: that's what this is. 677 00:32:57,400 --> 00:33:01,000 Speaker 2: The granularity is going to come down to shirts from Vietnam, 678 00:33:01,560 --> 00:33:05,920 Speaker 2: magnets from wherever, China, and something from Poland I can't pronounce. 679 00:33:06,040 --> 00:33:09,080 Speaker 7: I mean that's the reality, right, That's exactly the reality. 680 00:33:09,360 --> 00:33:13,040 Speaker 5: So we have consumer confidence numbers coming down pretty dramatically, 681 00:33:13,360 --> 00:33:18,360 Speaker 5: inflation expectations coming up from consumers pretty dramatically. It's the 682 00:33:18,400 --> 00:33:22,880 Speaker 5: economy stupid, that's tough politics. What are Republicans in Congress, 683 00:33:22,920 --> 00:33:25,720 Speaker 5: who do have maybe some races coming up in twenty 684 00:33:25,720 --> 00:33:28,960 Speaker 5: six how are they trying to deal with what is 685 00:33:29,120 --> 00:33:34,920 Speaker 5: potentially a very difficult economic fallout from President Trump's even 686 00:33:34,960 --> 00:33:37,880 Speaker 5: discussions forget about implementation, just discussions. 687 00:33:38,000 --> 00:33:38,280 Speaker 1: Yeah. 688 00:33:38,280 --> 00:33:40,360 Speaker 9: Well, I think that polling data really tells them all 689 00:33:40,360 --> 00:33:42,520 Speaker 9: that they need to know. And going into primary season, 690 00:33:42,640 --> 00:33:44,960 Speaker 9: the Republicans need to be careful to stay to the 691 00:33:45,040 --> 00:33:47,680 Speaker 9: right of Trump, not get on his bad side, because 692 00:33:47,720 --> 00:33:50,080 Speaker 9: primary season is obviously where the very engaged voters go. 693 00:33:50,400 --> 00:33:52,480 Speaker 9: So the latest data, I think it's from CBS News 694 00:33:52,520 --> 00:33:55,000 Speaker 9: is anywhere between eighty and ninety one percent of Republican 695 00:33:55,080 --> 00:33:58,360 Speaker 9: voters think that this is temporary, that prices will ultimately 696 00:33:58,400 --> 00:34:01,680 Speaker 9: come down, and we need to give the president more time. 697 00:34:01,760 --> 00:34:02,920 Speaker 7: So that is their playbook. 698 00:34:03,000 --> 00:34:06,200 Speaker 9: The real struggle is the independent voter, because now they're underwater. 699 00:34:06,400 --> 00:34:08,239 Speaker 9: They used to be thinking that President Trump was going 700 00:34:08,280 --> 00:34:09,799 Speaker 9: to be good on the economy, and now they're going 701 00:34:09,840 --> 00:34:11,600 Speaker 9: in the opposite direction. They think this is going to 702 00:34:11,640 --> 00:34:14,200 Speaker 9: lead to permanent higher prices, job loss, etc. 703 00:34:14,800 --> 00:34:17,680 Speaker 2: People ask me who am I following and of course, 704 00:34:17,719 --> 00:34:20,600 Speaker 2: I just voice what I hear from Henrietta Trade. To me, 705 00:34:20,719 --> 00:34:24,640 Speaker 2: the most important person inside the Beltwigh is how King Jeffries. 706 00:34:25,120 --> 00:34:28,359 Speaker 2: What does he do in the coming weeks to get 707 00:34:28,400 --> 00:34:31,719 Speaker 2: the Democrats going given this tear of crisis. 708 00:34:32,000 --> 00:34:34,600 Speaker 9: Well, I think really we need to see. The next 709 00:34:34,600 --> 00:34:36,840 Speaker 9: couple weeks are going to be hard because everybody's on recess. 710 00:34:36,960 --> 00:34:39,560 Speaker 9: But the focus on pharmaceutical tariffs, I think is what 711 00:34:39,600 --> 00:34:45,680 Speaker 9: you'll see the individual anecdotes about manufacturing plants, small businesses 712 00:34:45,800 --> 00:34:49,320 Speaker 9: going bankrupt, not having enough cash to stay liquid during 713 00:34:49,400 --> 00:34:50,560 Speaker 9: the increase in tariffs. 714 00:34:50,600 --> 00:34:53,240 Speaker 7: However temporary these may be for a lot of companies. 715 00:34:53,280 --> 00:34:53,880 Speaker 7: It's too long. 716 00:34:54,080 --> 00:34:56,960 Speaker 2: Doesn't he get on an airplane and go out to 717 00:34:57,040 --> 00:35:00,160 Speaker 2: some district in western Pennsylvania and try to f in 718 00:35:00,200 --> 00:35:05,319 Speaker 2: his center tendency Democrat who can actually compete against a 719 00:35:05,360 --> 00:35:07,960 Speaker 2: majority Republican Pennsylvania I. 720 00:35:07,920 --> 00:35:09,200 Speaker 7: Think they tribe. 721 00:35:09,400 --> 00:35:13,239 Speaker 9: I mean, I've been materially disappointed by how example had 722 00:35:13,239 --> 00:35:13,840 Speaker 9: no unification. 723 00:35:13,920 --> 00:35:15,800 Speaker 3: Well a Republican or Democrats. 724 00:35:15,920 --> 00:35:18,960 Speaker 2: You can't even get out to Illinois, which I think 725 00:35:19,000 --> 00:35:21,120 Speaker 2: they could compete and compete. 726 00:35:21,280 --> 00:35:24,200 Speaker 3: When does that start with Congressman Jefferies? 727 00:35:24,440 --> 00:35:26,520 Speaker 7: And honestly, if it hasn't started already. When is it 728 00:35:26,560 --> 00:35:28,800 Speaker 7: going to? Because it's been what four. 729 00:35:28,600 --> 00:35:31,520 Speaker 9: Months now of this administration, there's plenty of things to discuss. 730 00:35:32,400 --> 00:35:33,360 Speaker 9: I think they're underwater. 731 00:35:33,640 --> 00:35:36,880 Speaker 2: Have you ever met Daniel lanwat down in New Orleans? 732 00:35:36,880 --> 00:35:37,720 Speaker 3: A record producer? 733 00:35:37,880 --> 00:35:39,040 Speaker 7: I don't think so. 734 00:35:39,320 --> 00:35:42,879 Speaker 3: Like to zero, it's like it's like it's like it's 735 00:35:42,920 --> 00:35:45,640 Speaker 3: like magical. They did Chris Whitley's album Done give. 736 00:35:45,560 --> 00:35:47,200 Speaker 5: Us thirty seconds House New Orleans. 737 00:35:46,920 --> 00:35:49,040 Speaker 7: Doing That's fantastic. It's so fun. 738 00:35:49,080 --> 00:35:52,040 Speaker 9: French Quarterfest this weekend was incredible. Went out there, hurt 739 00:35:52,080 --> 00:35:54,680 Speaker 9: the Dirty Dozen Brass Band, come on down. It's a 740 00:35:54,719 --> 00:35:55,239 Speaker 9: great time. 741 00:35:55,600 --> 00:35:57,640 Speaker 5: So it's just a great, great city. I've been here 742 00:35:57,640 --> 00:35:58,759 Speaker 5: a few times. I need to get there more. 743 00:35:58,880 --> 00:35:59,399 Speaker 3: Why would say? 744 00:35:59,440 --> 00:36:02,120 Speaker 2: With Martin Feldstein and Robert Schuller, we all three of 745 00:36:02,160 --> 00:36:03,080 Speaker 2: us were sitting there. 746 00:36:03,280 --> 00:36:07,000 Speaker 3: Eating and we said can we not leave? Yeah, that's 747 00:36:07,000 --> 00:36:09,560 Speaker 3: what happen to be. You went down and just said 748 00:36:09,560 --> 00:36:10,160 Speaker 3: I'm not leaving. 749 00:36:10,480 --> 00:36:12,640 Speaker 7: I went down fifteen years ago. I can't get out. 750 00:36:12,800 --> 00:36:16,040 Speaker 3: Lisa. Does it say remote? I mean to me, it's 751 00:36:16,360 --> 00:36:17,600 Speaker 3: just surveillance. 752 00:36:17,040 --> 00:36:23,800 Speaker 2: Remote, surveillance, remote, ne Orlans James carvel On, have you 753 00:36:23,840 --> 00:36:26,520 Speaker 2: had a trace do this more often. You know, if 754 00:36:26,560 --> 00:36:28,440 Speaker 2: you need to get up here, we can free up 755 00:36:28,440 --> 00:36:31,640 Speaker 2: the surveillance golf stream and get you out here. Fantastic 756 00:36:32,560 --> 00:36:35,759 Speaker 2: a trace Veda partners, huge value add for us. 757 00:36:36,600 --> 00:36:41,440 Speaker 1: This is the Bloomberg Surveillance Podcast, available on Apple, Spotify, 758 00:36:41,560 --> 00:36:45,840 Speaker 1: and anywhere else you get your podcasts. Listen live each weekday, 759 00:36:45,960 --> 00:36:49,200 Speaker 1: seven to ten am Easter and on Bloomberg dot com, 760 00:36:49,360 --> 00:36:53,160 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 761 00:36:53,480 --> 00:36:56,560 Speaker 1: You can also watch us live every weekday on YouTube 762 00:36:56,880 --> 00:36:58,880 Speaker 1: and always on the Bloomberg terminal