1 00:00:00,280 --> 00:00:02,559 Speaker 1: This is Bloomberg Wall Street Week. 2 00:00:02,680 --> 00:00:07,280 Speaker 2: The global push into infrastructure, breaking the IPO logjam in text. 3 00:00:07,160 --> 00:00:09,120 Speaker 3: The financial stories that shape. 4 00:00:08,880 --> 00:00:12,000 Speaker 2: Our work, cutting inflation without losing jobs. Do we need 5 00:00:12,080 --> 00:00:14,520 Speaker 2: rate cuts? And if so? How many? Investing in the 6 00:00:14,560 --> 00:00:16,120 Speaker 2: time of geopolitical turmoil. 7 00:00:16,200 --> 00:00:18,520 Speaker 1: Through the eyes of the most influential voices. 8 00:00:18,720 --> 00:00:23,479 Speaker 2: Ten Rogoff Economists of Harvard, former fdicehead Shila bet Ge CEO, 9 00:00:23,600 --> 00:00:27,760 Speaker 2: Larry Coulp, San Francisco Fed President Mary Daily, Bloomberg Wall Street. 10 00:00:27,440 --> 00:00:30,200 Speaker 1: Week with David Weston from Bloomberg Radio. 11 00:00:30,280 --> 00:00:34,360 Speaker 2: Democrats nominate their candidate for president. Ford abandons it's all 12 00:00:34,400 --> 00:00:37,680 Speaker 2: electric SUV and the Fed moves closer to a September 13 00:00:37,760 --> 00:00:38,120 Speaker 2: rate cut. 14 00:00:38,520 --> 00:00:40,879 Speaker 3: This is Bloomberg Wall Street Week. I'm David Weston. 15 00:00:41,960 --> 00:00:44,479 Speaker 2: This week Scott Bessen's of Key Square Capital on a 16 00:00:44,479 --> 00:00:49,480 Speaker 2: precarious equilibrium for investors and the economic choice looming in November. 17 00:00:49,840 --> 00:00:52,720 Speaker 4: The US economy, in my mind, is starting to look 18 00:00:52,800 --> 00:00:54,440 Speaker 4: like an emerging market economy. 19 00:00:55,120 --> 00:00:58,160 Speaker 2: And Jennifer Huddleson of the Cato Institute on the path 20 00:00:58,200 --> 00:00:59,600 Speaker 2: forward for Google. 21 00:01:00,320 --> 00:01:02,680 Speaker 5: Is not just what it means for Google, but what 22 00:01:02,720 --> 00:01:15,560 Speaker 5: it means for consumers. 23 00:01:17,000 --> 00:01:19,800 Speaker 2: We start with Chairman Powell's remarks in Jackson Hole and 24 00:01:19,840 --> 00:01:23,160 Speaker 2: welcome back our very special contributor Larry Summers of Harvard. So, Larry, 25 00:01:23,319 --> 00:01:25,840 Speaker 2: we heard this week from share Powell. What did you 26 00:01:25,880 --> 00:01:26,839 Speaker 2: make of what he had to say? 27 00:01:28,360 --> 00:01:31,760 Speaker 6: Look, I think he's in the right broad place. 28 00:01:31,920 --> 00:01:39,360 Speaker 7: Inflation is coming down, the economy is slowing on current facts. Absolutely, 29 00:01:39,959 --> 00:01:44,479 Speaker 7: the next move should be towards monetary policy easing. And 30 00:01:45,080 --> 00:01:49,080 Speaker 7: that's what he said, and I'm glad he said that. 31 00:01:50,080 --> 00:01:55,000 Speaker 7: I think there were a number of really important issues 32 00:01:55,040 --> 00:02:00,640 Speaker 7: that are likely to be shaping of the policies for 33 00:02:00,680 --> 00:02:04,840 Speaker 7: the FED and for the economy more broadly that he 34 00:02:04,920 --> 00:02:12,400 Speaker 7: didn't address. He didn't say anything about epic budget deficit 35 00:02:12,919 --> 00:02:16,919 Speaker 7: challenges in the years ahead. At the same time, we've 36 00:02:16,960 --> 00:02:20,960 Speaker 7: got a huge investment demand for the green economy and 37 00:02:21,080 --> 00:02:26,200 Speaker 7: a huge investment demand for data centers and the like. 38 00:02:26,840 --> 00:02:29,560 Speaker 7: And so the question of what the neutral interest rate 39 00:02:29,760 --> 00:02:34,000 Speaker 7: is was one he talked Pat He didn't really engage 40 00:02:34,080 --> 00:02:38,520 Speaker 7: with the FED is saying that the neutral interest rate 41 00:02:38,880 --> 00:02:44,000 Speaker 7: is somewhere in the twos. I think that's extremely unlikely. 42 00:02:44,760 --> 00:02:48,000 Speaker 7: And if you don't have the right north star, you 43 00:02:48,080 --> 00:02:52,000 Speaker 7: don't navigate very accurately. And so I think the FEDS 44 00:02:52,560 --> 00:02:58,079 Speaker 7: making a serious mistake by believing that the neutral interest 45 00:02:58,200 --> 00:03:04,880 Speaker 7: rate is so low, and therefore is misjudging how restrictive 46 00:03:05,360 --> 00:03:10,720 Speaker 7: any given level of policy is. So I'd be surprised, 47 00:03:11,040 --> 00:03:18,960 Speaker 7: quite surprised if it actually proves possible with sustainability to 48 00:03:19,000 --> 00:03:22,360 Speaker 7: bring inflation down by nearly as much as the market 49 00:03:22,440 --> 00:03:25,639 Speaker 7: is expecting, or bring interest rates down by nearly as 50 00:03:25,680 --> 00:03:30,160 Speaker 7: much as the market is expecting over the next two years. 51 00:03:31,120 --> 00:03:35,080 Speaker 7: The other thing that the FED must be aware of, 52 00:03:35,840 --> 00:03:41,000 Speaker 7: and I understand why the chair didn't address it, but 53 00:03:41,160 --> 00:03:43,440 Speaker 7: it seems to me it's something they have to be 54 00:03:43,680 --> 00:03:48,280 Speaker 7: keeping in mind. Is we've got what people regard as 55 00:03:48,320 --> 00:03:52,760 Speaker 7: a fifty to fifty presidential election coming, and one of 56 00:03:52,760 --> 00:03:56,560 Speaker 7: the candidates says that the FED shouldn't be independent anymore. 57 00:03:57,360 --> 00:04:00,760 Speaker 7: That same candidate, Donald Trump, says that we need a 58 00:04:00,840 --> 00:04:05,840 Speaker 7: much weaker dollar. That same candidate says we need to 59 00:04:06,040 --> 00:04:13,960 Speaker 7: push tariffs way up, meaning higher prices of consumer goods 60 00:04:14,600 --> 00:04:19,880 Speaker 7: and more of an inflation threat. That same candidate talks 61 00:04:19,920 --> 00:04:24,360 Speaker 7: about sending millions of workers home, which would create epically 62 00:04:24,480 --> 00:04:30,760 Speaker 7: tight labor markets in our country and would surely go 63 00:04:30,880 --> 00:04:34,960 Speaker 7: back to labor shortages and wage inflation. 64 00:04:35,480 --> 00:04:37,800 Speaker 2: Larry turning back for a minute to Jay Powell's remarks 65 00:04:37,839 --> 00:04:41,080 Speaker 2: this week, he had sort of an initial explanation of 66 00:04:41,160 --> 00:04:44,400 Speaker 2: what happened with inflation, where it came from what the 67 00:04:44,400 --> 00:04:46,919 Speaker 2: FED did in response, and at least my take on 68 00:04:46,960 --> 00:04:50,520 Speaker 2: it was we had really supply shocks that were really unprecedented. 69 00:04:50,520 --> 00:04:52,640 Speaker 2: It took a longer sort of out, and we had 70 00:04:52,640 --> 00:04:55,280 Speaker 2: this big demand push, particularly in goods, that spilled over 71 00:04:55,320 --> 00:04:58,360 Speaker 2: into services. So it was sort of understandable why we 72 00:04:58,480 --> 00:05:02,120 Speaker 2: sort of made a mistake on team trans what's your reaction. 73 00:05:03,160 --> 00:05:07,080 Speaker 7: Look, I guess it's under I guess it's understandable. I 74 00:05:07,120 --> 00:05:11,159 Speaker 7: think I was reasonably clear in the spring of twenty 75 00:05:11,320 --> 00:05:14,720 Speaker 7: and twenty one that it seemed to me that there 76 00:05:14,760 --> 00:05:21,880 Speaker 7: were enormous inflation risks. I think looking back, it's kind 77 00:05:21,880 --> 00:05:25,160 Speaker 7: of incredible that the Fed could have said in May 78 00:05:25,240 --> 00:05:30,120 Speaker 7: of twenty twenty one that it expected to hold interest 79 00:05:30,240 --> 00:05:34,279 Speaker 7: rates at zero until the summer of twenty twenty four, 80 00:05:35,440 --> 00:05:41,680 Speaker 7: and so the misjudgment was a pretty egregious one. They're 81 00:05:42,120 --> 00:05:46,719 Speaker 7: trying to leave the impression that it was all surprising 82 00:05:46,960 --> 00:05:50,720 Speaker 7: supply shocks, and I think there are two problems with 83 00:05:50,800 --> 00:05:54,760 Speaker 7: that view. One is there shouldn't have been anything very 84 00:05:54,800 --> 00:05:59,479 Speaker 7: surprising about it. It's not like everybody didn't know that 85 00:05:59,760 --> 00:06:06,080 Speaker 7: cod was affecting the supply capacity of the economy. So 86 00:06:06,720 --> 00:06:09,400 Speaker 7: when the supply capacity is down, that means you have 87 00:06:09,440 --> 00:06:14,680 Speaker 7: to adjust the demand. And the other is that if 88 00:06:14,720 --> 00:06:19,320 Speaker 7: you look at nominal GDP growth, so that's dollar GDP, 89 00:06:19,600 --> 00:06:26,240 Speaker 7: it's the money stock adjusted for the velocity, it averaged 90 00:06:26,680 --> 00:06:30,000 Speaker 7: ten percent in twenty twenty one, in twenty twenty two, 91 00:06:30,800 --> 00:06:34,880 Speaker 7: and above eight percent for the three years twenty twenty 92 00:06:34,960 --> 00:06:39,919 Speaker 7: one to twenty twenty three. So how can you think 93 00:06:40,080 --> 00:06:44,320 Speaker 7: with eight to ten percent nominal GDP growth that you're 94 00:06:44,360 --> 00:06:50,440 Speaker 7: going to have anything like target inflation? And that nominal 95 00:06:50,480 --> 00:06:55,720 Speaker 7: GDP is just a measure of demand, which is what 96 00:06:55,880 --> 00:06:58,160 Speaker 7: monetary policy is supposed to. 97 00:06:58,160 --> 00:06:59,839 Speaker 8: Be all about. 98 00:07:00,279 --> 00:07:04,480 Speaker 7: So I think the FED got it wrong, and in 99 00:07:04,520 --> 00:07:09,560 Speaker 7: all honesty, I don't think it was a low point 100 00:07:10,040 --> 00:07:14,880 Speaker 7: in terms of monetary policy judgment. But you know, we 101 00:07:14,920 --> 00:07:20,000 Speaker 7: all make lots of mistakes, and the important thing is 102 00:07:20,080 --> 00:07:25,240 Speaker 7: when you make a mistake, to recognize it and fix it. 103 00:07:25,880 --> 00:07:28,280 Speaker 7: And I've got to give the FED credit for the 104 00:07:28,320 --> 00:07:31,960 Speaker 7: fact that while it wasn't always obvious that this would 105 00:07:32,000 --> 00:07:37,480 Speaker 7: be the case. They moved strongly enough and vigorously enough 106 00:07:38,200 --> 00:07:45,080 Speaker 7: to keep expectations anchored. And that's why it now looks 107 00:07:45,600 --> 00:07:49,160 Speaker 7: more frankly than I would have expected, like we're going 108 00:07:49,200 --> 00:07:54,680 Speaker 7: to get out of this very costly inflation episode without 109 00:07:55,080 --> 00:07:56,320 Speaker 7: a major recession. 110 00:07:57,160 --> 00:07:58,760 Speaker 3: Larry, thank you so much. It's always a treat to 111 00:07:58,800 --> 00:07:59,320 Speaker 3: have you with us. 112 00:07:59,440 --> 00:08:01,400 Speaker 2: That is our special contributor here on Wall Street Week. 113 00:08:01,400 --> 00:08:05,320 Speaker 2: He's Larry Summers of Harvard. The stock market continued its 114 00:08:05,400 --> 00:08:07,880 Speaker 2: upward climb this week, with one short detour on Thursday, 115 00:08:08,040 --> 00:08:10,040 Speaker 2: as the S and P five hundred added another one 116 00:08:10,080 --> 00:08:12,679 Speaker 2: point four five percent to end the week at fifty 117 00:08:12,800 --> 00:08:15,720 Speaker 2: six thirty five. That's nicely above the median number per 118 00:08:15,840 --> 00:08:18,320 Speaker 2: year end set by our Bloomberg Als at fifty six hundred. 119 00:08:18,520 --> 00:08:21,040 Speaker 2: The Nasdaq was just behind the S and P up 120 00:08:21,080 --> 00:08:23,200 Speaker 2: one point four percent for the week, while the yield 121 00:08:23,240 --> 00:08:25,920 Speaker 2: in the tenure was down almost nine basis points and 122 00:08:26,040 --> 00:08:28,520 Speaker 2: even week at three point eight percent. To take us 123 00:08:28,560 --> 00:08:31,280 Speaker 2: through the markets, we welcome back now, Scott Croner City. 124 00:08:31,280 --> 00:08:32,559 Speaker 3: Scott. Great to have you back with us. 125 00:08:32,640 --> 00:08:34,960 Speaker 2: We think of you as our equity expert here. So 126 00:08:35,280 --> 00:08:37,160 Speaker 2: tell me what's going on with these markets, they just 127 00:08:37,200 --> 00:08:39,560 Speaker 2: seem to go one direction pretty much, and that's up. 128 00:08:39,640 --> 00:08:40,720 Speaker 3: Should we be getting. 129 00:08:40,400 --> 00:08:43,000 Speaker 6: Worked well, David, great to be here. 130 00:08:43,240 --> 00:08:47,040 Speaker 9: I'd say the risk reward from our perspective has gotten 131 00:08:47,080 --> 00:08:51,120 Speaker 9: more balanced with this rally we've had. Essentially, we went 132 00:08:51,280 --> 00:08:54,040 Speaker 9: into Q three with the view that S and P 133 00:08:54,200 --> 00:08:56,720 Speaker 9: five hundred at fifty six hundred per year end made 134 00:08:56,720 --> 00:09:01,360 Speaker 9: some sense. We argue that valuations around twenty two times 135 00:09:01,440 --> 00:09:05,360 Speaker 9: we're sustainable. We're now at twenty three times. We've argued 136 00:09:05,400 --> 00:09:08,080 Speaker 9: that earnings growth under the surface for the S and 137 00:09:08,160 --> 00:09:11,240 Speaker 9: P five hundred is in good shape. That came through 138 00:09:11,280 --> 00:09:15,360 Speaker 9: with Q two reporting bigger picture, you've got three forces 139 00:09:15,360 --> 00:09:18,360 Speaker 9: at work in equities right now. One is the AI 140 00:09:18,520 --> 00:09:21,800 Speaker 9: tailwind that's been supporting the megacap. 141 00:09:21,360 --> 00:09:22,520 Speaker 6: Growth part of the market. 142 00:09:22,880 --> 00:09:27,280 Speaker 9: The other is soft landing conviction yes or no, and 143 00:09:27,320 --> 00:09:31,200 Speaker 9: it's been more yes of late, aided by Chairman Polace 144 00:09:31,280 --> 00:09:34,880 Speaker 9: commentary at Jackson Hole today. And then the third element 145 00:09:35,040 --> 00:09:38,040 Speaker 9: is the election impact, and that's I'm going to say 146 00:09:38,040 --> 00:09:40,360 Speaker 9: a little bit more of a tail risk that's been 147 00:09:40,400 --> 00:09:43,920 Speaker 9: pushed to side for now as we continue to kind 148 00:09:43,960 --> 00:09:47,560 Speaker 9: of work our way through the aftermath of the dmc SO. 149 00:09:47,520 --> 00:09:49,720 Speaker 2: Let's go to the first one there, the AI momentum. 150 00:09:49,720 --> 00:09:52,080 Speaker 2: If I can put it that way, We've got Nvidia. 151 00:09:51,840 --> 00:09:53,000 Speaker 3: Earnings coming up next week. 152 00:09:53,120 --> 00:09:56,120 Speaker 2: How important does that make something like in Vidia's earnings 153 00:09:56,240 --> 00:09:59,319 Speaker 2: indicating whether we're keeping the momentum or losing some of it. 154 00:10:00,160 --> 00:10:02,200 Speaker 9: Well, the starting point is you look at where we 155 00:10:02,360 --> 00:10:04,360 Speaker 9: ended the first half. The S and P was up 156 00:10:04,360 --> 00:10:08,440 Speaker 9: about fifteen percent, and we'd attribute about five percentage points 157 00:10:08,440 --> 00:10:11,000 Speaker 9: of that move to each of Nvidia, the rest of 158 00:10:11,040 --> 00:10:13,959 Speaker 9: the MAG seven and the other four ninety three within 159 00:10:14,000 --> 00:10:16,719 Speaker 9: the S and P. So Nvidia has been an important 160 00:10:16,720 --> 00:10:19,920 Speaker 9: contributor to the S and P five hundred move. Obviously, 161 00:10:19,960 --> 00:10:23,560 Speaker 9: it pulled back from mid July into early August and 162 00:10:23,679 --> 00:10:27,240 Speaker 9: now has recovered. So I'd say absolutely yes. The way 163 00:10:27,280 --> 00:10:30,160 Speaker 9: they report, the way they position themselves in terms of 164 00:10:30,440 --> 00:10:33,800 Speaker 9: future growth expectations is going to have an important influence 165 00:10:33,920 --> 00:10:36,520 Speaker 9: on its stock but also on the balance of the 166 00:10:36,559 --> 00:10:38,160 Speaker 9: MAG seven and this AI play. 167 00:10:38,280 --> 00:10:39,880 Speaker 2: Well, it's interesting, as you said, sort of a third 168 00:10:39,880 --> 00:10:42,600 Speaker 2: to third to third, but the third third was actually 169 00:10:42,640 --> 00:10:45,120 Speaker 2: the rest of the pack. Are we starting to see 170 00:10:45,160 --> 00:10:47,199 Speaker 2: some broadening out now? Because for a long time we 171 00:10:47,200 --> 00:10:50,240 Speaker 2: were worried there was such a narrow driving of the SMP. 172 00:10:51,400 --> 00:10:54,200 Speaker 9: Well, it's fascinating when you look at the way Q 173 00:10:54,280 --> 00:10:57,320 Speaker 9: two results have finished. Okay, and we're pretty close. We 174 00:10:57,360 --> 00:10:59,559 Speaker 9: still have to get Nvidia and a few others to report. 175 00:11:00,200 --> 00:11:03,840 Speaker 9: You actually had that meg seven component growing earnings in 176 00:11:03,920 --> 00:11:07,400 Speaker 9: Q two by roughly thirty eight percent, which is pretty astonishing. 177 00:11:07,480 --> 00:11:07,880 Speaker 6: Okay. 178 00:11:08,120 --> 00:11:12,280 Speaker 9: We think there's some persistence of that in the second half. Interestingly, 179 00:11:12,400 --> 00:11:16,680 Speaker 9: the other four ninety three grew earnings in aggregate five percent. 180 00:11:16,920 --> 00:11:20,240 Speaker 9: Doesn't sound like much, but that's the first quarter of 181 00:11:20,240 --> 00:11:23,360 Speaker 9: the last six where we've actually gotten a positive earnings 182 00:11:23,400 --> 00:11:26,440 Speaker 9: growth dynamic out of the rest of the four ninety three. 183 00:11:27,280 --> 00:11:29,120 Speaker 2: How are we positioned going into the second half of 184 00:11:29,160 --> 00:11:31,360 Speaker 2: the year. We're now starting the second half of the year. 185 00:11:32,400 --> 00:11:36,240 Speaker 2: Go ahead, get that piece back in there. You've got it, okay, Scott. 186 00:11:36,280 --> 00:11:38,240 Speaker 2: What I was asking was how are we position going 187 00:11:38,280 --> 00:11:38,920 Speaker 2: in the second. 188 00:11:38,720 --> 00:11:39,240 Speaker 3: Half of the year. 189 00:11:40,160 --> 00:11:43,199 Speaker 9: So we think we're pretty well positioned. From the following 190 00:11:43,240 --> 00:11:46,880 Speaker 9: perspective on the pullback, we were very comfortable re engaging 191 00:11:46,880 --> 00:11:51,000 Speaker 9: in that megacap growth cohort on this mantra that growth 192 00:11:51,080 --> 00:11:54,840 Speaker 9: is defensive as we navigate signs of economic weakness, which 193 00:11:54,880 --> 00:11:59,560 Speaker 9: is ongoing, but more directly, we put our major sector 194 00:11:59,640 --> 00:12:03,000 Speaker 9: focus on those areas most likely to benefit from the 195 00:12:03,000 --> 00:12:06,520 Speaker 9: FED pivot, which apparently is getting closer and closer. Obviously 196 00:12:06,800 --> 00:12:10,640 Speaker 9: September coming up. So we've been quite constructive on areas 197 00:12:10,640 --> 00:12:15,360 Speaker 9: such as consumer discretionary financials via the banks and then 198 00:12:15,559 --> 00:12:18,480 Speaker 9: interestingly also through the real estate part of the SMP. 199 00:12:18,800 --> 00:12:21,760 Speaker 2: Scott, that's why you're our equities expert. Always, thank you 200 00:12:21,760 --> 00:12:24,960 Speaker 2: so much, as Scott Kroner of City. Coming up, Michael 201 00:12:25,000 --> 00:12:27,720 Speaker 2: Milkine has said the drive to LBOs was made possible 202 00:12:27,720 --> 00:12:30,760 Speaker 2: by VISITALC. What changes could be driven by the current 203 00:12:30,800 --> 00:12:34,160 Speaker 2: crop of tech innovations. We've talked with William Deringer of MIT. 204 00:12:34,640 --> 00:12:36,920 Speaker 2: That's coming up next on Wall Street Weeek on Bloomberg. 205 00:12:40,160 --> 00:12:44,400 Speaker 1: This is Bloomberg Wall Street Week with David Weston from 206 00:12:44,520 --> 00:12:49,400 Speaker 1: Bloomberg Radio. 207 00:12:52,120 --> 00:12:54,760 Speaker 2: This is Wall Street Week. I'm David Weston, Junk Bond King. 208 00:12:54,920 --> 00:12:57,920 Speaker 2: Michael Milkine once said that it was the earlier spreadsheet 209 00:12:57,960 --> 00:13:01,679 Speaker 2: program VISITALC that made pop sold the LBOs and takeovers 210 00:13:01,679 --> 00:13:02,600 Speaker 2: of the nineteen eighties. 211 00:13:03,040 --> 00:13:05,320 Speaker 3: Technology has come a long way from then. 212 00:13:05,720 --> 00:13:08,959 Speaker 2: Professor William Deringer of MIT has studied what effects this 213 00:13:09,040 --> 00:13:12,640 Speaker 2: ever increasing computing bar is having on which deals get 214 00:13:12,679 --> 00:13:16,600 Speaker 2: done and how we asked him what led to his research. 215 00:13:18,400 --> 00:13:20,720 Speaker 8: So this sort of an interesting story. 216 00:13:20,760 --> 00:13:25,440 Speaker 10: I was actually at an event at MIT and I 217 00:13:25,559 --> 00:13:29,160 Speaker 10: was speaking with someone who was one of the board 218 00:13:29,240 --> 00:13:32,880 Speaker 10: members at MIT, and he mentioned, you know, I used 219 00:13:32,880 --> 00:13:34,200 Speaker 10: to know some of the people who were involved with 220 00:13:34,559 --> 00:13:37,920 Speaker 10: VisiCalc early on, and a series of conversations led me 221 00:13:38,120 --> 00:13:41,720 Speaker 10: to this kind of interesting anecdote that apparently Michael Milcott 222 00:13:41,720 --> 00:13:44,040 Speaker 10: at one point had said that if you really want 223 00:13:44,040 --> 00:13:48,320 Speaker 10: to understand what happened in the eighties and the kind of. 224 00:13:48,120 --> 00:13:49,000 Speaker 8: The rise of. 225 00:13:50,440 --> 00:13:53,079 Speaker 10: Buyouts and the sort of Maggie deals of that period, 226 00:13:54,160 --> 00:13:57,439 Speaker 10: the real key is visital So it was spreadsheet software. 227 00:13:57,960 --> 00:13:59,160 Speaker 10: And so I spent some time trying. 228 00:13:58,960 --> 00:14:01,080 Speaker 8: To kind of track down this anect. 229 00:14:01,480 --> 00:14:03,520 Speaker 10: I found it mentioned a couple of a couple of 230 00:14:03,559 --> 00:14:05,600 Speaker 10: other places, and it took me on this sort of 231 00:14:05,600 --> 00:14:08,400 Speaker 10: interesting journey of trying to figure out, well, what what 232 00:14:08,400 --> 00:14:10,560 Speaker 10: would that I have actually looked like? What so, how 233 00:14:10,600 --> 00:14:14,720 Speaker 10: would spreadsheets software actually have changed things? 234 00:14:14,840 --> 00:14:18,080 Speaker 8: And what I found was that it's sort of more 235 00:14:18,120 --> 00:14:18,719 Speaker 8: than just. 236 00:14:19,040 --> 00:14:23,880 Speaker 10: A matter of kind of making calculations easier, but that 237 00:14:24,280 --> 00:14:28,400 Speaker 10: it really seemed to change the kind of limits of 238 00:14:28,720 --> 00:14:33,320 Speaker 10: financial thinking and imagination, so things that were pretty hard 239 00:14:33,360 --> 00:14:36,880 Speaker 10: to do. So modeling and modeling an LBO by hand 240 00:14:37,160 --> 00:14:42,720 Speaker 10: kind of you know, on paper, was very arduous, very 241 00:14:42,760 --> 00:14:47,080 Speaker 10: time consuming, and importantly it was not sort of dynamic. 242 00:14:47,160 --> 00:14:50,600 Speaker 10: You couldn't kind of tweak one parameter, you know, tweak 243 00:14:50,640 --> 00:14:53,200 Speaker 10: an interest rate, tweak a projection for revenue growth or 244 00:14:53,280 --> 00:14:57,360 Speaker 10: something and then kind of get a new answer. 245 00:14:58,080 --> 00:15:01,480 Speaker 8: Uh. And so what seems to have been very quickly. 246 00:15:01,240 --> 00:15:05,360 Speaker 10: And there are you know, interesting quotations about this from 247 00:15:05,400 --> 00:15:10,040 Speaker 10: people at the time, was deal makers realized that you 248 00:15:10,040 --> 00:15:14,680 Speaker 10: could use spreadsheet software to not only kind of model 249 00:15:15,280 --> 00:15:19,120 Speaker 10: potential deals, but also to sort of scan the realm 250 00:15:19,160 --> 00:15:22,480 Speaker 10: of possible deals. So instead of having to just look 251 00:15:22,480 --> 00:15:25,040 Speaker 10: at one possible deal, you could run similar sorts of 252 00:15:25,040 --> 00:15:29,680 Speaker 10: scenarios across the kind of wide range of different potential 253 00:15:29,680 --> 00:15:30,360 Speaker 10: target companies. 254 00:15:30,400 --> 00:15:32,240 Speaker 8: And I think that in some ways, really we could 255 00:15:32,280 --> 00:15:36,000 Speaker 8: even say it sort of changed the way in which business. 256 00:15:35,800 --> 00:15:40,200 Speaker 10: Was understood from the sort of perspective of Wallstreet. 257 00:15:40,160 --> 00:15:41,120 Speaker 3: From your work. 258 00:15:41,280 --> 00:15:44,880 Speaker 2: Could Mike Milkine have done what he did without spreadsheets? 259 00:15:45,240 --> 00:15:47,320 Speaker 10: I don't think so. I mean I think that a lot. 260 00:15:47,360 --> 00:15:49,760 Speaker 10: I think there would have been significant limitations. I mean, 261 00:15:49,760 --> 00:15:53,240 Speaker 10: a one of the things that's interesting about the Milkan story, 262 00:15:53,400 --> 00:15:55,040 Speaker 10: and this was actually a lot of what my research 263 00:15:55,160 --> 00:15:59,080 Speaker 10: was interested in, was he was sort of simultaneously his 264 00:15:59,120 --> 00:16:05,000 Speaker 10: work was simultaneously very technologically innovative and at the same 265 00:16:05,080 --> 00:16:05,760 Speaker 10: time sort of. 266 00:16:05,800 --> 00:16:07,600 Speaker 8: Very personality drivet. 267 00:16:08,600 --> 00:16:11,000 Speaker 10: But there were certain aspects of the kind of milk 268 00:16:11,040 --> 00:16:13,880 Speaker 10: and machine that was built built that was highly technical. 269 00:16:13,920 --> 00:16:16,720 Speaker 10: I mean, much of it was even down to things 270 00:16:16,760 --> 00:16:21,800 Speaker 10: like being able to track and sort of catalog the 271 00:16:21,880 --> 00:16:25,680 Speaker 10: existence sort of where the market was in high yield bonds, 272 00:16:25,680 --> 00:16:28,560 Speaker 10: who owned things, who were you know, who were potential buyers? 273 00:16:29,640 --> 00:16:30,000 Speaker 8: Uh. 274 00:16:30,040 --> 00:16:34,920 Speaker 10: But then also kind of valuation techniques. There were sort 275 00:16:34,960 --> 00:16:38,320 Speaker 10: of long standing methods of course for valuing bonds, but 276 00:16:38,600 --> 00:16:43,560 Speaker 10: with new sort of handheld calculators and the spreadsheets those 277 00:16:43,680 --> 00:16:48,040 Speaker 10: the ability to kind of analyze and value fixed income 278 00:16:48,120 --> 00:16:50,800 Speaker 10: instruments became kind of radically easier. 279 00:16:51,440 --> 00:16:55,360 Speaker 2: Where are we now, How is the current technology changing 280 00:16:55,400 --> 00:16:58,200 Speaker 2: the nature of deal making and private aquay? And let 281 00:16:58,200 --> 00:16:59,840 Speaker 2: me ask you a very specific question, do we just 282 00:17:00,280 --> 00:17:02,240 Speaker 2: need as many private bankers anymore? 283 00:17:02,840 --> 00:17:03,080 Speaker 8: Yeah? 284 00:17:03,160 --> 00:17:05,119 Speaker 10: So, I mean, as as someone who spend most of 285 00:17:05,160 --> 00:17:08,240 Speaker 10: my time in the in the past. I I know 286 00:17:08,359 --> 00:17:10,639 Speaker 10: sort of about as much about the kind of really 287 00:17:10,680 --> 00:17:13,360 Speaker 10: cutting edge stuff as certainly you know many of your 288 00:17:13,440 --> 00:17:14,240 Speaker 10: of your viewers. 289 00:17:14,280 --> 00:17:17,000 Speaker 8: But from what I understand, you. 290 00:17:16,960 --> 00:17:19,680 Speaker 10: Know, one of the areas of development, as for example, 291 00:17:20,359 --> 00:17:23,800 Speaker 10: trying to find sort of use the classy of AI 292 00:17:24,040 --> 00:17:26,800 Speaker 10: to sort of simplify and automate things. 293 00:17:26,600 --> 00:17:27,640 Speaker 8: Like modeling LBOs. 294 00:17:27,720 --> 00:17:30,800 Speaker 10: Right, So, you know, when I was at DID training, 295 00:17:31,000 --> 00:17:34,920 Speaker 10: you know, my first day as an investment banker. You 296 00:17:35,600 --> 00:17:37,400 Speaker 10: not the first day, but maybe you know, week two 297 00:17:37,480 --> 00:17:40,440 Speaker 10: or something, you learned how to kind of build LBO. 298 00:17:40,240 --> 00:17:42,080 Speaker 8: Models on spreadsheets. 299 00:17:42,080 --> 00:17:44,840 Speaker 10: And that's the sort of thing that required quite a 300 00:17:44,840 --> 00:17:48,600 Speaker 10: lot of training, required a certain kind of technical artifice 301 00:17:48,640 --> 00:17:51,000 Speaker 10: and expertise, And that's the sort of thing that may 302 00:17:51,080 --> 00:17:56,200 Speaker 10: go towards that that may require less sort of direct 303 00:17:57,560 --> 00:18:00,840 Speaker 10: kind of time and training. But one thing I think, 304 00:18:01,000 --> 00:18:03,960 Speaker 10: you know, we know from the history of technology and 305 00:18:04,000 --> 00:18:07,639 Speaker 10: certainly the history of the kind of calculation tools that 306 00:18:07,880 --> 00:18:13,040 Speaker 10: I like to study, is that the kind of automation 307 00:18:13,160 --> 00:18:16,840 Speaker 10: of some of those calculations and the automation of kind 308 00:18:16,880 --> 00:18:20,120 Speaker 10: of lots of different things and the world don't necessarily 309 00:18:21,000 --> 00:18:22,159 Speaker 10: lead to less work. 310 00:18:23,480 --> 00:18:25,119 Speaker 8: So if I had to guess. 311 00:18:24,880 --> 00:18:26,919 Speaker 10: And I mean, as a historian, we're always sort of 312 00:18:26,920 --> 00:18:31,760 Speaker 10: cautious about making prognostications. I would not think that new 313 00:18:31,840 --> 00:18:36,240 Speaker 10: tools would sort of lead to the need for fewer people, 314 00:18:37,119 --> 00:18:40,200 Speaker 10: but rather, what I would expect to happen. 315 00:18:40,040 --> 00:18:42,320 Speaker 8: Was that they would kind of change the nature of 316 00:18:42,400 --> 00:18:42,879 Speaker 8: the work. 317 00:18:43,680 --> 00:18:47,359 Speaker 2: That was Professor William Derringer of MIT at the end 318 00:18:47,440 --> 00:18:49,639 Speaker 2: of a week focused on Kamala Harris's plans for the 319 00:18:49,640 --> 00:18:52,880 Speaker 2: economy and how they differ from Donald Trump's. Welcome back now, 320 00:18:53,000 --> 00:18:57,240 Speaker 2: macro investor Scott Besson, founder and CEO of Key Square Capital. So, Scott, 321 00:18:57,280 --> 00:18:59,360 Speaker 2: welcome back. Good to have you here, David, always nice 322 00:18:59,400 --> 00:19:01,480 Speaker 2: to be with you. Before we get to the rival 323 00:19:01,720 --> 00:19:03,800 Speaker 2: economic theories here, let's talk about where we are in 324 00:19:03,800 --> 00:19:04,240 Speaker 2: the economy. 325 00:19:04,240 --> 00:19:04,520 Speaker 3: Generally. 326 00:19:04,600 --> 00:19:06,800 Speaker 2: You have a note out right now talking about a 327 00:19:06,840 --> 00:19:11,000 Speaker 2: precarious equilibrium in the economy. What makes that precarious? 328 00:19:11,160 --> 00:19:15,240 Speaker 4: Well, now, I've been doing this thirty thirty five years now, 329 00:19:15,560 --> 00:19:18,720 Speaker 4: and the US economy, in my mind, is starting to 330 00:19:18,760 --> 00:19:23,160 Speaker 4: look like an emerging market economy. That or every kind 331 00:19:23,200 --> 00:19:25,880 Speaker 4: of emerging market below up that I've seen in my career, 332 00:19:26,320 --> 00:19:30,840 Speaker 4: and that is you have rise in asset prices. So 333 00:19:31,119 --> 00:19:35,240 Speaker 4: in the US stocks and housing that is fueling consumption 334 00:19:35,480 --> 00:19:38,520 Speaker 4: by the top ten or twenty percent of households, top 335 00:19:38,560 --> 00:19:41,119 Speaker 4: ten or twenty percent of households or count for more 336 00:19:41,160 --> 00:19:46,240 Speaker 4: than fifty percent of US consumption. Then the below that 337 00:19:46,720 --> 00:19:49,439 Speaker 4: the rise in asset price is being fueled by a 338 00:19:49,520 --> 00:19:53,880 Speaker 4: seven percent to GDP budget deficit, the biggest we've ever 339 00:19:53,920 --> 00:19:57,920 Speaker 4: had when it's not a war, not a reception. Then 340 00:19:57,960 --> 00:20:00,480 Speaker 4: the third leg of that is jenet y and has 341 00:20:00,560 --> 00:20:05,800 Speaker 4: moved the quarterly refunding to what shorter term debt, which 342 00:20:05,800 --> 00:20:09,600 Speaker 4: has had the effect of suppressing interest rates. So you 343 00:20:09,680 --> 00:20:12,080 Speaker 4: know you've got I call it the three body problem 344 00:20:12,320 --> 00:20:15,920 Speaker 4: after the Chinese science fiction book and the famous math problem. 345 00:20:16,160 --> 00:20:20,080 Speaker 4: So we don't know which one of those could go first, 346 00:20:20,640 --> 00:20:23,200 Speaker 4: but it's one of these that if the stock market 347 00:20:23,240 --> 00:20:26,720 Speaker 4: were to go down, then it could create a gap 348 00:20:26,760 --> 00:20:27,800 Speaker 4: in consumer spending. 349 00:20:28,160 --> 00:20:31,440 Speaker 2: So that does sound pretty perilous for investors. And given 350 00:20:31,440 --> 00:20:33,399 Speaker 2: the fact we don't know which one will break, although 351 00:20:33,400 --> 00:20:34,919 Speaker 2: you think one of them is likely to break at 352 00:20:34,960 --> 00:20:37,480 Speaker 2: some point, what does investor do? How do they position 353 00:20:37,520 --> 00:20:38,760 Speaker 2: themselves for something breaking? 354 00:20:38,960 --> 00:20:43,199 Speaker 4: Well, I think investors should be ready for more volatility, 355 00:20:43,320 --> 00:20:46,639 Speaker 4: which I also talked about in the note you know, 356 00:20:47,040 --> 00:20:50,640 Speaker 4: I think gold's very interesting here. It's at an all 357 00:20:50,720 --> 00:20:54,840 Speaker 4: time high, I think as we're speaking today, and you know, 358 00:20:55,080 --> 00:20:57,600 Speaker 4: I think just in general, everyone should do a gut 359 00:20:57,680 --> 00:20:59,520 Speaker 4: check make sure they're not too far out on the 360 00:20:59,560 --> 00:21:02,359 Speaker 4: risk curve, because you know, it's been a pretty good run. 361 00:21:03,000 --> 00:21:06,000 Speaker 2: So let's turn to the question of rival economic plans 362 00:21:06,040 --> 00:21:08,600 Speaker 2: from Donald Trump, somebody whom you know have known for 363 00:21:08,640 --> 00:21:10,480 Speaker 2: a lot of years and talked to you from time 364 00:21:10,520 --> 00:21:13,119 Speaker 2: to time, and then Kamala Harris, someone new out of 365 00:21:13,160 --> 00:21:16,200 Speaker 2: the scene at least with inspector economic plans. How does 366 00:21:16,280 --> 00:21:20,199 Speaker 2: investor really really address those two alternatives? How do you 367 00:21:20,240 --> 00:21:22,680 Speaker 2: macro investor on these tools? Start with Kamala Harris. 368 00:21:22,720 --> 00:21:26,480 Speaker 4: Well, look, I think it's two competing visions. You know, 369 00:21:27,640 --> 00:21:30,000 Speaker 4: Michael Boskin had a very good editorial in the Wall 370 00:21:30,000 --> 00:21:33,720 Speaker 4: Street Journal yesterday and he said, you know, we're not 371 00:21:33,760 --> 00:21:36,680 Speaker 4: getting a lot of meat out of Kamala Harris's programs yet, 372 00:21:36,920 --> 00:21:39,359 Speaker 4: but we can go back and look, and there are 373 00:21:39,400 --> 00:21:43,199 Speaker 4: three different sources there. What is she say in the 374 00:21:43,200 --> 00:21:47,400 Speaker 4: twenty twenty campaign? What did Harris Biden do? And then 375 00:21:47,480 --> 00:21:50,080 Speaker 4: what is she said so far so in the twenty 376 00:21:50,119 --> 00:21:54,199 Speaker 4: twenty campaign, which you know, she's running from you know, 377 00:21:55,000 --> 00:22:01,400 Speaker 4: single pair healthcare, you know, lots of restrictions, the big, big, 378 00:22:01,440 --> 00:22:04,240 Speaker 4: big spending stopping fracking, which. 379 00:22:04,080 --> 00:22:06,720 Speaker 2: She has backed off of. She said she's thinking better now. 380 00:22:07,359 --> 00:22:09,679 Speaker 4: Well, you know, I always think with a politician, it's 381 00:22:09,720 --> 00:22:12,480 Speaker 4: where's your heart and where's your head? And I think 382 00:22:12,480 --> 00:22:14,960 Speaker 4: in her heart she still believes that. You know, with 383 00:22:15,400 --> 00:22:19,720 Speaker 4: Joe Biden, he campaigned to Scranton Joe and then broke 384 00:22:19,800 --> 00:22:22,919 Speaker 4: hard left, and you know, we ended up with a 385 00:22:22,920 --> 00:22:23,720 Speaker 4: great inflation. 386 00:22:24,200 --> 00:22:26,880 Speaker 8: I think she is hard left. She's trying to. 387 00:22:28,480 --> 00:22:32,120 Speaker 4: Maybe constructive ambiguity, and you know, I think maybe that's 388 00:22:32,200 --> 00:22:35,920 Speaker 4: why CNN in the Washington Post came out and chastise her. 389 00:22:36,520 --> 00:22:39,879 Speaker 4: Chastised her over the policy she talked about in Raleigh 390 00:22:39,880 --> 00:22:42,320 Speaker 4: on Friday, because she's supposed to keep the mask on 391 00:22:43,080 --> 00:22:45,000 Speaker 4: the past November fifth. 392 00:22:46,080 --> 00:22:49,440 Speaker 2: However we read it. What about things like housing? She's 393 00:22:49,440 --> 00:22:51,320 Speaker 2: trying to address that we do have a housing problem 394 00:22:51,359 --> 00:22:53,399 Speaker 2: in this country. I think you'd agree we do not 395 00:22:53,440 --> 00:22:55,920 Speaker 2: have enough housing. We're not building enough housing. She has 396 00:22:55,920 --> 00:22:57,560 Speaker 2: a plan at least to try to stimulate that. 397 00:22:58,000 --> 00:22:59,960 Speaker 4: Well, there was no plan to say how she's going 398 00:22:59,960 --> 00:23:02,399 Speaker 4: to stimulate it. What she's going to stimulate is buying. 399 00:23:02,800 --> 00:23:05,600 Speaker 4: We don't need more house buyers, we need more houses, 400 00:23:05,960 --> 00:23:08,399 Speaker 4: and there was nothing for how that's going to happen. 401 00:23:08,800 --> 00:23:10,520 Speaker 2: If don't the markets react to then say, if they're 402 00:23:10,520 --> 00:23:12,400 Speaker 2: going to be house more house buyers, we better start 403 00:23:12,400 --> 00:23:13,240 Speaker 2: building some houses. 404 00:23:13,960 --> 00:23:16,280 Speaker 4: No, it just means prices are going to go up, 405 00:23:16,320 --> 00:23:18,720 Speaker 4: costs are going to go up. You know, why don't 406 00:23:18,760 --> 00:23:21,600 Speaker 4: you know there's no solution to the root calls? Why 407 00:23:21,680 --> 00:23:25,720 Speaker 4: don't we have more more housing now? Is that you 408 00:23:25,760 --> 00:23:30,639 Speaker 4: know Blue City, the zoning problems. Is it that we 409 00:23:30,680 --> 00:23:35,920 Speaker 4: need some kind of nationalized regulatory you know, in terms 410 00:23:35,960 --> 00:23:40,560 Speaker 4: of building codes. Is there an affordability problem? Because you know, 411 00:23:40,640 --> 00:23:43,200 Speaker 4: I will tell you that a lot of the policies 412 00:23:43,320 --> 00:23:45,280 Speaker 4: from Harris Biden over the past three and a half 413 00:23:45,359 --> 00:23:47,960 Speaker 4: years have added to the cost of housing. 414 00:23:48,200 --> 00:23:50,200 Speaker 2: So let's turn to the other side of the aisle. 415 00:23:50,240 --> 00:23:52,240 Speaker 2: If you could to Donald Trump something you know a 416 00:23:52,240 --> 00:23:55,240 Speaker 2: fair amount about a lot of criticism that his economic 417 00:23:55,280 --> 00:23:58,159 Speaker 2: plans would actually be inflationary, particularly on the tariffs and 418 00:23:58,160 --> 00:24:03,760 Speaker 2: curtailing employment from and curtailing immigration. What do you respond, Well, first, 419 00:24:03,800 --> 00:24:06,640 Speaker 2: let's talk about contailing immigration. So for the first time 420 00:24:06,640 --> 00:24:10,800 Speaker 2: in my career, first time in my career, the left 421 00:24:10,880 --> 00:24:15,960 Speaker 2: is actually admitting that immigration suppresses wages. For thirty five 422 00:24:16,040 --> 00:24:20,720 Speaker 2: years we heard immigration does not suppress wages. Now it 423 00:24:20,760 --> 00:24:25,800 Speaker 2: seems like the only supply side solution that Harris Biden 424 00:24:25,880 --> 00:24:28,359 Speaker 2: had in the past three and a half years is 425 00:24:28,480 --> 00:24:31,640 Speaker 2: more low end workers. But it did keep inflation down 426 00:24:31,720 --> 00:24:32,959 Speaker 2: below where it otherwise would have been. 427 00:24:33,000 --> 00:24:36,200 Speaker 4: Do you agree well in the Harris Biden world, sure, 428 00:24:37,119 --> 00:24:42,560 Speaker 4: because they also constricted heavy regulation and they kept people 429 00:24:42,560 --> 00:24:48,479 Speaker 4: out of the workplace, And then I actually don't think 430 00:24:49,040 --> 00:24:54,639 Speaker 4: that they have a problem with low end workers doing better. 431 00:24:55,720 --> 00:24:58,679 Speaker 4: So if low end wages go up, and you know, 432 00:24:58,760 --> 00:25:02,600 Speaker 4: as you said, you know tariff's terriffs for a one 433 00:25:02,640 --> 00:25:06,439 Speaker 4: time price adjustment, it's not inflationary. You don't set off 434 00:25:06,480 --> 00:25:10,439 Speaker 4: an inflationary spiral. It's what in the UK they call 435 00:25:10,480 --> 00:25:12,680 Speaker 4: it an administrative adjustment. 436 00:25:12,200 --> 00:25:13,720 Speaker 3: Provided you don't keep escalating them. 437 00:25:14,520 --> 00:25:16,600 Speaker 4: Providing you don't keep escalating them. 438 00:25:16,840 --> 00:25:18,600 Speaker 2: Scott, it's always a treat to have you with us. 439 00:25:18,600 --> 00:25:21,919 Speaker 2: Thank you so much, the Scott Bessant of Key Square Capital. 440 00:25:23,840 --> 00:25:27,199 Speaker 2: Coming up, Google has been judged a monopolist. What comes 441 00:25:27,240 --> 00:25:30,720 Speaker 2: next for a leading hyperscaler, We ask Jennifer Huddleson of 442 00:25:30,760 --> 00:25:31,920 Speaker 2: the Cato Institute. 443 00:25:32,320 --> 00:25:34,080 Speaker 5: I think there's always a question when it comes to 444 00:25:34,160 --> 00:25:36,959 Speaker 5: tech companies of what would a breakup actually mean and 445 00:25:37,000 --> 00:25:37,960 Speaker 5: what would that look like. 446 00:25:39,280 --> 00:25:41,520 Speaker 3: That's next on Wall Street Week on Bloomberg. 447 00:25:42,640 --> 00:25:46,880 Speaker 1: This is Bloomberg Walls Street Week with David Weston from 448 00:25:47,000 --> 00:25:49,680 Speaker 1: Bloomberg Radio. 449 00:25:54,760 --> 00:25:56,560 Speaker 3: This is Wall Street Week. I'm David Weston. 450 00:25:56,600 --> 00:25:58,840 Speaker 2: A federal district court has ruled that Google is a 451 00:25:58,880 --> 00:26:02,120 Speaker 2: monopolist when it the search and this fall will decide 452 00:26:02,119 --> 00:26:04,520 Speaker 2: what to do about it. To explain what's at stake 453 00:26:04,600 --> 00:26:07,760 Speaker 2: and what to look for next. Welcome back now, Jennifer Huddleson, 454 00:26:08,000 --> 00:26:11,520 Speaker 2: Cato Institute's Senior Fellow and Technology Policy. Great to have 455 00:26:11,560 --> 00:26:14,679 Speaker 2: you back, Jennifer. So let's start with what the court decided. 456 00:26:14,760 --> 00:26:17,520 Speaker 2: It's a very long decision, but having looked through it, 457 00:26:17,680 --> 00:26:20,320 Speaker 2: there's a lot of talk about the Biden administration really trying. 458 00:26:20,119 --> 00:26:21,680 Speaker 3: To create new and trust law. 459 00:26:22,080 --> 00:26:26,199 Speaker 2: Is this new law or established law being applied to Google? 460 00:26:26,640 --> 00:26:27,880 Speaker 6: It's a bit complicated. 461 00:26:28,000 --> 00:26:31,560 Speaker 5: So what we saw in this particular case was that 462 00:26:31,600 --> 00:26:34,919 Speaker 5: the court ruled that Google had violated parts of the 463 00:26:34,920 --> 00:26:37,120 Speaker 5: Sherman Act in two key regards. 464 00:26:37,119 --> 00:26:40,239 Speaker 6: When it comes to the exclusive distribution. 465 00:26:39,840 --> 00:26:42,840 Speaker 5: Requirement agreements that it had, as well as to a 466 00:26:42,960 --> 00:26:45,320 Speaker 5: very specific type of search advertising. 467 00:26:45,720 --> 00:26:46,920 Speaker 6: We saw Judge Meta in. 468 00:26:46,880 --> 00:26:51,200 Speaker 5: This case apply the Microsoft case to this. Although there's 469 00:26:51,240 --> 00:26:53,840 Speaker 5: a lot of questions around some of the decisions that 470 00:26:53,880 --> 00:26:57,000 Speaker 5: were made, some of what the court decided to reject 471 00:26:57,000 --> 00:27:00,280 Speaker 5: in terms of potential competitors, whether or not that the 472 00:27:00,280 --> 00:27:04,320 Speaker 5: market that consumers actually experience, some of the conversation around 473 00:27:04,320 --> 00:27:07,359 Speaker 5: what some of these alternative products look like, whether or 474 00:27:07,440 --> 00:27:10,600 Speaker 5: not they're actually equal products or inferior products. 475 00:27:10,840 --> 00:27:11,960 Speaker 6: So while we didn't. 476 00:27:11,760 --> 00:27:16,160 Speaker 5: Necessarily see new law or a change from the consumer 477 00:27:16,200 --> 00:27:19,680 Speaker 5: welfare standard, we did see some questions about perhaps how 478 00:27:19,720 --> 00:27:21,680 Speaker 5: some of those standards were being applot. 479 00:27:22,040 --> 00:27:24,480 Speaker 2: What does this mean for Google? I mean, one thing, 480 00:27:24,480 --> 00:27:26,919 Speaker 2: it means they've already said they're going to appeal, and 481 00:27:27,000 --> 00:27:29,119 Speaker 2: we know from the Microsoft case that you'd referred to 482 00:27:29,320 --> 00:27:31,560 Speaker 2: that took a good long time, several years going up 483 00:27:31,600 --> 00:27:33,800 Speaker 2: and down and finally settling. But what does it mean 484 00:27:33,840 --> 00:27:36,960 Speaker 2: for Google in the long run? Do you think it'll. 485 00:27:36,680 --> 00:27:38,720 Speaker 5: Certainly be interesting to see And I think the question 486 00:27:38,800 --> 00:27:41,159 Speaker 5: is not just what it means for Google, but what 487 00:27:41,240 --> 00:27:44,000 Speaker 5: it means for consumers and what it means for other 488 00:27:44,080 --> 00:27:47,320 Speaker 5: businesses when it comes to businesses dealing with one another 489 00:27:47,440 --> 00:27:51,120 Speaker 5: in businesses creating certain types of agreements. While this case 490 00:27:51,160 --> 00:27:55,280 Speaker 5: specifically deals with some of Google's distribution agreements, it's likely 491 00:27:55,320 --> 00:27:58,880 Speaker 5: to have some broader impact as well. It'll be interesting 492 00:27:58,880 --> 00:28:01,639 Speaker 5: to see what the rim these phase actually looks like 493 00:28:01,760 --> 00:28:04,119 Speaker 5: if and when we get to that point. As you mentioned, 494 00:28:04,119 --> 00:28:06,879 Speaker 5: the case is like it's going to be appealed, and 495 00:28:06,920 --> 00:28:10,080 Speaker 5: it's likely to take several more months, if not years, 496 00:28:10,080 --> 00:28:11,560 Speaker 5: to come to a final decision. 497 00:28:12,200 --> 00:28:14,919 Speaker 2: We have that remedy sphase coming up in the fall now, 498 00:28:15,119 --> 00:28:17,400 Speaker 2: and one of the things that Bloomberg's report is the 499 00:28:17,480 --> 00:28:20,439 Speaker 2: Justice Parment is at least considering the possibility of asking 500 00:28:20,480 --> 00:28:21,679 Speaker 2: to have Google broken up. 501 00:28:21,720 --> 00:28:22,320 Speaker 3: Is that likely? 502 00:28:22,760 --> 00:28:24,560 Speaker 5: I think there's always a question when it comes to 503 00:28:24,600 --> 00:28:27,439 Speaker 5: tech companies of what would a breakup actually mean and 504 00:28:27,480 --> 00:28:29,640 Speaker 5: what would that look like, and is that something that's 505 00:28:29,680 --> 00:28:34,560 Speaker 5: even truly possible. In many cases, oftentimes consumers like the 506 00:28:34,600 --> 00:28:37,639 Speaker 5: fact that their products are able to be integrated with 507 00:28:37,680 --> 00:28:40,600 Speaker 5: one another. That's one of the things that consumers are 508 00:28:40,600 --> 00:28:46,000 Speaker 5: looking for. We often see actually requests for more interoperability. 509 00:28:45,040 --> 00:28:45,640 Speaker 6: Not less. 510 00:28:45,960 --> 00:28:48,400 Speaker 2: Let's talk specifically about it. If they don't break up Google. 511 00:28:48,520 --> 00:28:52,880 Speaker 2: What the possible behavioral remedies could be seeing you mentioned 512 00:28:52,920 --> 00:28:56,480 Speaker 2: the restrictive agreements that at least the judge final restrictive 513 00:28:56,520 --> 00:28:59,880 Speaker 2: with respect to Google paying Apple and others to have 514 00:29:00,120 --> 00:29:02,160 Speaker 2: their search engine embedded as the default. 515 00:29:02,680 --> 00:29:03,960 Speaker 3: Is there any pro. 516 00:29:03,760 --> 00:29:07,000 Speaker 2: Competitive justification for doing that? Wasn't that something that was 517 00:29:07,000 --> 00:29:10,480 Speaker 2: pretty nakedly a way of really deterring other competitors. 518 00:29:10,880 --> 00:29:15,120 Speaker 5: We've seen default agreements reached in multiple cases, and the 519 00:29:15,280 --> 00:29:18,560 Speaker 5: judge did continue to uphold trinco and say there is 520 00:29:18,720 --> 00:29:21,800 Speaker 5: no duty to deal. So it is important to recognize 521 00:29:21,840 --> 00:29:26,120 Speaker 5: that there is a possibility to see these agreements continue 522 00:29:26,160 --> 00:29:29,760 Speaker 5: in some way. The question is was Google acting as 523 00:29:29,880 --> 00:29:32,480 Speaker 5: a monopolist and abusing its ability. 524 00:29:32,120 --> 00:29:34,080 Speaker 6: To get these agreements? And this really is. 525 00:29:34,080 --> 00:29:36,600 Speaker 5: Also going to come down to that question of are 526 00:29:36,640 --> 00:29:39,120 Speaker 5: the alternative search engines inferior products? 527 00:29:39,120 --> 00:29:42,080 Speaker 6: If there's no price that Apple would pay to set 528 00:29:42,160 --> 00:29:43,000 Speaker 6: being as its. 529 00:29:42,840 --> 00:29:45,520 Speaker 5: Default, is it fair to say that they can't have 530 00:29:45,640 --> 00:29:46,800 Speaker 5: Google as their default? 531 00:29:47,120 --> 00:29:48,600 Speaker 6: What does that mean for consumers? 532 00:29:48,640 --> 00:29:52,560 Speaker 5: Are we expecting consumers to get the inferior product when 533 00:29:52,800 --> 00:29:56,320 Speaker 5: what companies are trying to do is provide their consumers, 534 00:29:56,320 --> 00:29:59,920 Speaker 5: whether it's a smartphone company, or a web browser. 535 00:30:00,080 --> 00:30:01,560 Speaker 6: Product that they actually want. 536 00:30:01,800 --> 00:30:04,320 Speaker 5: When we look to Europe where they change the way 537 00:30:04,360 --> 00:30:06,800 Speaker 5: that defaults could be done, and when you get a 538 00:30:06,840 --> 00:30:08,600 Speaker 5: new phone out of the box or go to a 539 00:30:08,640 --> 00:30:12,160 Speaker 5: new web browser, there's not necessarily a default search engine. 540 00:30:12,280 --> 00:30:16,760 Speaker 5: We see that consumers overwhelmingly still cuse Google because it's 541 00:30:16,800 --> 00:30:19,400 Speaker 5: the search engine that they want right now, and it's 542 00:30:19,440 --> 00:30:21,680 Speaker 5: the search engine that is bringing them the kind of 543 00:30:21,720 --> 00:30:22,840 Speaker 5: results they expect. 544 00:30:23,160 --> 00:30:25,520 Speaker 2: Let me play devil's advocate here actually in reading this decision, 545 00:30:25,560 --> 00:30:28,120 Speaker 2: because I hear what you're saying, and there are findings 546 00:30:28,160 --> 00:30:30,160 Speaker 2: that if hact, Google is just a better search engine. 547 00:30:30,280 --> 00:30:32,320 Speaker 2: But if that's true, why were they paying all that money? 548 00:30:32,480 --> 00:30:34,800 Speaker 2: I mean, Google's a pretty smart company. They're not going 549 00:30:34,840 --> 00:30:37,560 Speaker 2: to pay billions of dollars for nothing. And if they 550 00:30:37,560 --> 00:30:39,280 Speaker 2: really are just a better search engine, they didn't have 551 00:30:39,320 --> 00:30:41,280 Speaker 2: to pay any money. They would have been the default 552 00:30:41,520 --> 00:30:42,160 Speaker 2: by default. 553 00:30:42,640 --> 00:30:45,600 Speaker 5: There continues to be a wide array of business dece 554 00:30:45,600 --> 00:30:49,320 Speaker 5: engines that go into these kind of complicated agreements. What 555 00:30:49,360 --> 00:30:51,560 Speaker 5: we really need to be looking at is is this 556 00:30:51,680 --> 00:30:54,440 Speaker 5: a case where we see consumers being harmed? Is this 557 00:30:54,520 --> 00:30:58,680 Speaker 5: a case where we see a company abusing its monopolist behavior? 558 00:30:59,080 --> 00:31:00,800 Speaker 6: And then we. 559 00:31:00,720 --> 00:31:03,320 Speaker 5: Should really focus on the fact that just because a 560 00:31:03,360 --> 00:31:06,280 Speaker 5: company is large does it and just because a company 561 00:31:06,320 --> 00:31:09,640 Speaker 5: is successful doesn't mean that it can't engage in standard 562 00:31:09,680 --> 00:31:12,400 Speaker 5: business practices that we would allow other companies to do 563 00:31:12,440 --> 00:31:12,880 Speaker 5: as well. 564 00:31:13,400 --> 00:31:17,360 Speaker 2: This Google case was brought under President Biden and his administration. 565 00:31:16,880 --> 00:31:17,880 Speaker 3: By the Justice Department. 566 00:31:18,240 --> 00:31:19,840 Speaker 2: We do have an election coming up, you may have 567 00:31:19,880 --> 00:31:22,520 Speaker 2: noticed in November, and we may have we will have 568 00:31:22,560 --> 00:31:24,600 Speaker 2: a different president. It will either be Kamala Harris on 569 00:31:24,600 --> 00:31:26,520 Speaker 2: the one hand, or will we hit Donald Trump. At 570 00:31:26,520 --> 00:31:29,840 Speaker 2: this point, do we have any sense what competition policy 571 00:31:29,920 --> 00:31:33,000 Speaker 2: might look like under either of their regimes. 572 00:31:33,440 --> 00:31:35,719 Speaker 5: When we look at the previous Trump administration, they were 573 00:31:35,800 --> 00:31:37,720 Speaker 5: highly critical of several. 574 00:31:37,400 --> 00:31:39,120 Speaker 6: Of America's leading tech companies. 575 00:31:39,160 --> 00:31:42,400 Speaker 5: In fact, many of the anti trust cases started during 576 00:31:42,400 --> 00:31:45,720 Speaker 5: the Trump administration, or the investigations at least started during 577 00:31:45,760 --> 00:31:50,000 Speaker 5: the Trump administration. Similarly, we've seen the Buiyen administration continue 578 00:31:50,040 --> 00:31:53,920 Speaker 5: to be critical of big companies in general and really 579 00:31:53,960 --> 00:31:57,080 Speaker 5: try and push this more European. 580 00:31:56,600 --> 00:31:58,600 Speaker 6: Style anti trust approach. 581 00:31:58,840 --> 00:32:01,960 Speaker 5: So I think, regardless of who wins in November, we're 582 00:32:02,040 --> 00:32:05,640 Speaker 5: likely to see continued scrutiny of large companies, and the 583 00:32:05,720 --> 00:32:08,719 Speaker 5: question should be is that good for consumers and is 584 00:32:08,760 --> 00:32:09,720 Speaker 5: that good for innovation? 585 00:32:11,080 --> 00:32:13,000 Speaker 2: On the question of how much of consumer pays because 586 00:32:13,000 --> 00:32:15,160 Speaker 2: there are problems with network effects and things. Is there 587 00:32:15,160 --> 00:32:17,840 Speaker 2: an issue that we're not getting to see other competitors 588 00:32:17,840 --> 00:32:19,880 Speaker 2: They just never make it into the game at all. 589 00:32:19,960 --> 00:32:21,880 Speaker 2: That's one of the claims I believe that was made 590 00:32:21,880 --> 00:32:24,600 Speaker 2: in the Google case that people just couldn't get into it. 591 00:32:24,640 --> 00:32:27,280 Speaker 2: There may be a better, more innovative search product out there, 592 00:32:27,400 --> 00:32:28,000 Speaker 2: we just never. 593 00:32:27,880 --> 00:32:28,479 Speaker 3: Get to see it. 594 00:32:29,280 --> 00:32:32,600 Speaker 5: One of the things that we often see in technology sector, 595 00:32:32,680 --> 00:32:35,440 Speaker 5: particularly when we're talking about these kind of antitrust cases, 596 00:32:35,480 --> 00:32:38,760 Speaker 5: are questions of market definition. In the Google case, the 597 00:32:38,840 --> 00:32:42,000 Speaker 5: judge very much locked into this kind of general search 598 00:32:42,120 --> 00:32:45,360 Speaker 5: in gen definition, things that allowed you to search and 599 00:32:45,400 --> 00:32:48,200 Speaker 5: then go off site was what he really wanted to 600 00:32:48,240 --> 00:32:51,080 Speaker 5: limit it to, to limit the number of competitors. But 601 00:32:51,160 --> 00:32:54,400 Speaker 5: if we look at trends, particularly amongst younger users Gen 602 00:32:54,520 --> 00:32:58,560 Speaker 5: Z and Gen Alpha that's starting to access the Internet, 603 00:32:58,840 --> 00:33:03,080 Speaker 5: they're really looking at video forward. Often they're going to TikTok, 604 00:33:03,160 --> 00:33:06,160 Speaker 5: or they're going to Google's YouTube to do their searches, 605 00:33:06,280 --> 00:33:09,120 Speaker 5: or they're doing much more specialized searches where they're not 606 00:33:09,160 --> 00:33:12,840 Speaker 5: necessarily using those general search engines. That's something that's kind 607 00:33:12,840 --> 00:33:15,400 Speaker 5: of changed with all users, and the judge in this 608 00:33:15,560 --> 00:33:18,240 Speaker 5: case kind of pushed that aside to really only focus 609 00:33:18,280 --> 00:33:21,200 Speaker 5: on general search engines. He said that couldn't be considered 610 00:33:21,200 --> 00:33:24,720 Speaker 5: competition because you couldn't go off site. But the question 611 00:33:24,800 --> 00:33:26,960 Speaker 5: is is that really the consumer experience? 612 00:33:27,280 --> 00:33:29,120 Speaker 6: And this is also where AI comes up. 613 00:33:29,320 --> 00:33:33,200 Speaker 5: Is AI going to be so revolutionary that this completely 614 00:33:33,320 --> 00:33:36,320 Speaker 5: changes the way that we view what it means to 615 00:33:36,360 --> 00:33:39,440 Speaker 5: conduct search? Is this is looking at a general search 616 00:33:39,480 --> 00:33:41,600 Speaker 5: engine in a few years going to be the same 617 00:33:41,640 --> 00:33:45,400 Speaker 5: as talking about video rental stores as streaming is coming about. 618 00:33:45,680 --> 00:33:48,160 Speaker 2: Jennifer is always great to have you on these anastrust questions. 619 00:33:48,200 --> 00:33:48,840 Speaker 3: Thank you so much. 620 00:33:49,000 --> 00:33:54,280 Speaker 2: That's Jennifer Huddleson of the Cato Institute. Rule number one, 621 00:33:54,680 --> 00:33:58,800 Speaker 2: never lose money, Rule number two. Never forget rule number one, 622 00:33:59,080 --> 00:34:01,880 Speaker 2: so says Warren buff Unfortunately, too many of us appear 623 00:34:01,960 --> 00:34:04,240 Speaker 2: to forget both of Buffett's rules too often. 624 00:34:04,720 --> 00:34:06,240 Speaker 3: Just this week, Ford lost. 625 00:34:05,960 --> 00:34:09,080 Speaker 2: One point nine billion dollars on its all electric three 626 00:34:09,160 --> 00:34:12,880 Speaker 2: row SUV when it concluded there wasn't enough consumer interest 627 00:34:13,040 --> 00:34:13,800 Speaker 2: to make it work. 628 00:34:14,200 --> 00:34:17,600 Speaker 11: I talked to Ford CEO Jim Farley, and he said 629 00:34:17,640 --> 00:34:21,759 Speaker 11: the new mantra is that any new electric vehicle must 630 00:34:21,840 --> 00:34:25,279 Speaker 11: be profitable within its first year on the market. If 631 00:34:25,280 --> 00:34:26,480 Speaker 11: they can't do. 632 00:34:26,320 --> 00:34:27,719 Speaker 3: That, it won't be approved. 633 00:34:27,840 --> 00:34:30,960 Speaker 11: That's why they canceled this electric three row SUV. 634 00:34:31,360 --> 00:34:35,000 Speaker 2: Others are losing money for less auspicious reasons. Former Representative 635 00:34:35,040 --> 00:34:38,280 Speaker 2: George Santos lost three hundred and seventy four thousand dollars 636 00:34:38,280 --> 00:34:41,040 Speaker 2: this week when he agreed to pay restitution after pleading 637 00:34:41,040 --> 00:34:44,200 Speaker 2: guilty to charges of wirefraud and identity theft. 638 00:34:44,280 --> 00:34:45,640 Speaker 3: And if that weren't enough, he'll. 639 00:34:45,560 --> 00:34:47,600 Speaker 2: Likely have to do some jail time as well. 640 00:34:48,080 --> 00:34:52,480 Speaker 3: It's turned me now that hile out ambission to Cobnie judgment. 641 00:34:53,360 --> 00:34:56,440 Speaker 11: We need to make decisions that were another day and 642 00:34:57,520 --> 00:35:01,759 Speaker 11: guilty beating guilty a I never imagine. 643 00:35:02,120 --> 00:35:05,840 Speaker 7: I hate, but it is a necessary one because it 644 00:35:05,920 --> 00:35:06,960 Speaker 7: is the right thing to do. 645 00:35:07,280 --> 00:35:10,200 Speaker 2: Carl Icon is losing two million dollars in fines he 646 00:35:10,200 --> 00:35:13,520 Speaker 2: owes to the SEC for not disclosing enough about margin loans, 647 00:35:13,760 --> 00:35:15,840 Speaker 2: But all that's a drop in the bucket of the 648 00:35:15,960 --> 00:35:18,799 Speaker 2: nineteen billion dollars in net worth he's lost in the 649 00:35:18,880 --> 00:35:20,200 Speaker 2: last fifteen months. 650 00:35:20,360 --> 00:35:23,560 Speaker 12: Both Icon and IEP have agreed to pay one point 651 00:35:23,600 --> 00:35:27,160 Speaker 12: five million and five hundred thousand dollars in civil penalties 652 00:35:27,160 --> 00:35:31,440 Speaker 12: to settle these charges without admitting or denying the findings. 653 00:35:31,680 --> 00:35:35,399 Speaker 12: Very interestingly, these go through December of twenty eighteen to 654 00:35:35,480 --> 00:35:37,759 Speaker 12: the present, and this was fifty one to eighty two 655 00:35:37,840 --> 00:35:43,240 Speaker 12: percent of IEP's outstanding securities as collateral pledged to secure 656 00:35:43,320 --> 00:35:44,760 Speaker 12: margin loans worth billions. 657 00:35:45,000 --> 00:35:47,320 Speaker 2: Many US find ways to lose money that don't involve 658 00:35:47,360 --> 00:35:50,840 Speaker 2: getting crosswise of the law. Buying lottery tickets, for example, 659 00:35:51,120 --> 00:35:54,560 Speaker 2: state lotteries took in over one hundred billion dollars last year, 660 00:35:54,600 --> 00:35:57,120 Speaker 2: which is good for the States, but not necessarily for 661 00:35:57,200 --> 00:35:59,759 Speaker 2: those buying the tickets. Over a third of that money 662 00:35:59,760 --> 00:36:02,359 Speaker 2: staid with the States, which means the rest of US 663 00:36:02,360 --> 00:36:05,520 Speaker 2: lost about thirty seven billion dollars on the deal. Betting 664 00:36:05,520 --> 00:36:07,560 Speaker 2: on sporting events has yet to catch up with the 665 00:36:07,600 --> 00:36:11,080 Speaker 2: state lotteries, but it's moving up fast, with the American 666 00:36:11,160 --> 00:36:14,440 Speaker 2: Gaming Association saying about thirty seven billion dollars was wagered 667 00:36:14,480 --> 00:36:17,439 Speaker 2: in the first quarter of this year alone, with over 668 00:36:17,560 --> 00:36:20,080 Speaker 2: three billion of that going to those taking the bets 669 00:36:20,280 --> 00:36:20,840 Speaker 2: for the leagues. 670 00:36:20,880 --> 00:36:23,279 Speaker 13: This is a revenue stream at a key time for 671 00:36:23,360 --> 00:36:26,040 Speaker 13: them because we're seeing that media rights there's a lot 672 00:36:26,080 --> 00:36:28,800 Speaker 13: of tunnel, a lot of disruption, especially at the team level. 673 00:36:28,960 --> 00:36:32,520 Speaker 13: So I think bringing in the gambling money to supplement 674 00:36:32,600 --> 00:36:35,040 Speaker 13: that has been something that they've really leaned on recently. 675 00:36:35,080 --> 00:36:37,640 Speaker 2: Sports has given us another way to separate us from 676 00:36:37,680 --> 00:36:40,840 Speaker 2: our money. It's the purchase of name, image, and likeness 677 00:36:40,840 --> 00:36:43,880 Speaker 2: of our favorite college football star. And as if betting 678 00:36:43,920 --> 00:36:46,879 Speaker 2: on sports weren't enough, the football program at Oklahoma State 679 00:36:46,960 --> 00:36:48,960 Speaker 2: University has found a way to make it easier for 680 00:36:49,040 --> 00:36:52,600 Speaker 2: us to spend our money on those nils. They now 681 00:36:52,640 --> 00:36:55,600 Speaker 2: put QR codes on their players' helmets, so you can 682 00:36:55,719 --> 00:36:58,640 Speaker 2: use your smartphone when you're watching on TV and purchase 683 00:36:58,680 --> 00:37:01,640 Speaker 2: the NIL for your favorite player without having to go 684 00:37:01,719 --> 00:37:04,480 Speaker 2: find it. Of course, it's not only about losing money. 685 00:37:04,560 --> 00:37:07,080 Speaker 2: There's always the enjoyment you get from just being in 686 00:37:07,120 --> 00:37:09,640 Speaker 2: the game, even if most of the money ends up 687 00:37:09,680 --> 00:37:12,319 Speaker 2: going to the house. I'm no gambler, but I did 688 00:37:12,320 --> 00:37:14,560 Speaker 2: have one great evening in Las Vegas when I spent 689 00:37:14,640 --> 00:37:16,840 Speaker 2: a couple of hours at the craps table and actually 690 00:37:16,960 --> 00:37:19,839 Speaker 2: ended up a little bit ahead of the game. But 691 00:37:19,880 --> 00:37:24,279 Speaker 2: then again, I had the smartest, funniest and best tutor there, ever, 692 00:37:24,560 --> 00:37:27,719 Speaker 2: was Nora Ephron, who taught me how to calculate the 693 00:37:27,719 --> 00:37:30,160 Speaker 2: odds of the dice coming up on any particular number, 694 00:37:30,400 --> 00:37:32,319 Speaker 2: and then how to use the odds to place my 695 00:37:32,480 --> 00:37:35,520 Speaker 2: pass versus don't pass, and come versus don't come bets, 696 00:37:35,840 --> 00:37:37,680 Speaker 2: which actually worked at. 697 00:37:37,560 --> 00:37:39,360 Speaker 3: Least when she was with me. 698 00:37:40,160 --> 00:37:41,960 Speaker 2: That does it for this episode of Wall Street Week, 699 00:37:42,000 --> 00:37:42,880 Speaker 2: I'm David Weston. 700 00:37:42,960 --> 00:37:52,520 Speaker 3: This is Bloomberg. See you next week.