1
00:00:02,640 --> 00:00:05,320
Speaker 1: Welcome to the Bloomberg Penl Podcast. I'm Paul swing you

2
00:00:05,360 --> 00:00:07,680
Speaker 1: along with my co host Lisa Brahma Waits. Each day

3
00:00:07,720 --> 00:00:10,240
Speaker 1: we bring you the most noteworthy and useful interviews for

4
00:00:10,280 --> 00:00:12,520
Speaker 1: you and your money. Whether at the grocery store or

5
00:00:12,560 --> 00:00:15,480
Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple

6
00:00:15,520 --> 00:00:17,959
Speaker 1: podcast or wherever you listen to podcasts, as well as

7
00:00:17,960 --> 00:00:22,560
Speaker 1: at Bloomberg dot com. There's a question, especially since there

8
00:00:22,760 --> 00:00:25,479
Speaker 1: is going to be some sort of recovery the virus

9
00:00:25,600 --> 00:00:28,440
Speaker 1: will end, where do you find value? How do you

10
00:00:28,480 --> 00:00:32,800
Speaker 1: find a compass in an unprecedented period of time? Joining

11
00:00:32,840 --> 00:00:36,000
Speaker 1: us now, Carl Weinberg, Founder and chief International economist at

12
00:00:36,080 --> 00:00:39,120
Speaker 1: High Frequency Economics in New York, and based on your

13
00:00:39,159 --> 00:00:43,839
Speaker 1: deckies of experience, including the restructuring of Latin American crisis

14
00:00:43,880 --> 00:00:46,879
Speaker 1: back in the eighties, I'm wondering, what are you looking

15
00:00:47,000 --> 00:00:50,200
Speaker 1: for to determine the floor here and get a sense

16
00:00:50,280 --> 00:00:53,760
Speaker 1: of its time to buy? Hi? Good morning. Well, you

17
00:00:53,800 --> 00:00:57,320
Speaker 1: know time to buy is more complicated than just economics.

18
00:00:57,600 --> 00:00:59,880
Speaker 1: I'm focused on the where the economy is going to

19
00:01:00,040 --> 00:01:02,440
Speaker 1: be and how we're going to get through this. This

20
00:01:02,520 --> 00:01:05,920
Speaker 1: bump in my experience, a difference between a downturn and

21
00:01:05,920 --> 00:01:08,840
Speaker 1: a crisis is whether or not things break. And the

22
00:01:08,920 --> 00:01:11,319
Speaker 1: question is whether this break and income is going to

23
00:01:11,360 --> 00:01:15,479
Speaker 1: be severe enough to cause institutions, companies to fail and

24
00:01:15,880 --> 00:01:17,680
Speaker 1: get us to a point where when we come back,

25
00:01:18,000 --> 00:01:20,560
Speaker 1: we're not as strong as we were as when we

26
00:01:20,600 --> 00:01:22,920
Speaker 1: went into all of this. So, Carl, what are some

27
00:01:22,959 --> 00:01:25,120
Speaker 1: of the type of data that you're going to be

28
00:01:25,120 --> 00:01:26,960
Speaker 1: looking at going forward to get a sense of whether

29
00:01:27,040 --> 00:01:29,360
Speaker 1: this is a little bit more of a short term

30
00:01:29,440 --> 00:01:31,440
Speaker 1: issue once we get to the other side of the virus,

31
00:01:31,520 --> 00:01:34,680
Speaker 1: or perhaps something more fundamental to the global economy. Well,

32
00:01:34,720 --> 00:01:37,480
Speaker 1: here's what we're going to be discussing in our global

33
00:01:37,480 --> 00:01:40,720
Speaker 1: webinar at High Frequent Economics later this week on Thursday morning.

34
00:01:40,760 --> 00:01:43,679
Speaker 1: I believe I'm looking at the data from China and

35
00:01:43,720 --> 00:01:47,760
Speaker 1: I'm looking at January February figures, and I'm seeing plus

36
00:01:47,840 --> 00:01:51,520
Speaker 1: down on retail sells over a year for the January

37
00:01:51,600 --> 00:01:54,040
Speaker 1: February numbers. I've seen thirteen and a half percent down

38
00:01:54,120 --> 00:01:57,360
Speaker 1: year over your on industrial production. And I'm wondering, could

39
00:01:57,480 --> 00:02:00,880
Speaker 1: that happen here with our lockdown? You know they locked down,

40
00:02:00,880 --> 00:02:03,000
Speaker 1: we're locking down. Why wouldn't we get the same result?

41
00:02:03,360 --> 00:02:06,120
Speaker 1: And if we got that. I'm trying to guest of it,

42
00:02:06,240 --> 00:02:08,800
Speaker 1: because I've never seen anything like this before. What the

43
00:02:08,880 --> 00:02:11,720
Speaker 1: impact of two or three months at that level of

44
00:02:11,760 --> 00:02:14,560
Speaker 1: the press activity would mean for the solvency of small

45
00:02:14,600 --> 00:02:17,560
Speaker 1: and medium enterprises, and for that matter, for the solvency

46
00:02:17,560 --> 00:02:20,400
Speaker 1: of big enterprises and the banks that serviced them. This

47
00:02:20,560 --> 00:02:22,920
Speaker 1: is the kind of the scale of the question that

48
00:02:23,040 --> 00:02:25,359
Speaker 1: I'm thinking about, and it's framed very much by the

49
00:02:25,440 --> 00:02:28,200
Speaker 1: data from China. Auto production in China, by the way,

50
00:02:28,280 --> 00:02:32,120
Speaker 1: dropped almost eight year over year in February. These are

51
00:02:32,280 --> 00:02:34,840
Speaker 1: enormous numbers, and again one has to ask, if it

52
00:02:34,960 --> 00:02:38,880
Speaker 1: happened there, why would similar clients happen here, and what

53
00:02:38,919 --> 00:02:41,720
Speaker 1: would the consequences be. So have you started to model

54
00:02:41,800 --> 00:02:45,720
Speaker 1: that out? I've started to think about I can't really model,

55
00:02:45,720 --> 00:02:48,160
Speaker 1: at least because I don't have any historical data to

56
00:02:48,200 --> 00:02:50,320
Speaker 1: hold it up against. So we're really in the realm

57
00:02:50,320 --> 00:02:52,560
Speaker 1: of guests of it. And that puts economics of the

58
00:02:52,600 --> 00:02:55,919
Speaker 1: same places where the medicine is. We're looking at potentially

59
00:02:56,120 --> 00:02:59,919
Speaker 1: an unprecedented shock I'll call it a supply shock by

60
00:03:00,040 --> 00:03:02,880
Speaker 1: that reduces our capacity to work. It reduces the number

61
00:03:02,880 --> 00:03:05,040
Speaker 1: of people who can get to their jobs, and that

62
00:03:05,080 --> 00:03:08,840
Speaker 1: means we can produce left stuff. And along that sliding

63
00:03:08,880 --> 00:03:11,240
Speaker 1: that supply curve to the left, we end up with

64
00:03:11,360 --> 00:03:17,240
Speaker 1: shortages of stuff, higher prices, speculation scenario with dramatically lower output,

65
00:03:17,480 --> 00:03:20,080
Speaker 1: and frankly, Lisa, I'm just beginning to think about how

66
00:03:20,120 --> 00:03:23,200
Speaker 1: to think about it. So, Carl, we've seen the side

67
00:03:23,200 --> 00:03:25,880
Speaker 1: of reserve come in aggressively over the weekend last night

68
00:03:26,440 --> 00:03:30,600
Speaker 1: with lower rates and some QE. What do you think

69
00:03:30,960 --> 00:03:33,720
Speaker 1: is that? Do you think that what this economy really

70
00:03:33,880 --> 00:03:39,000
Speaker 1: needs is a comprehensive fiscal package coming out of Washington. Um,

71
00:03:39,080 --> 00:03:41,640
Speaker 1: we need a package coming out of Washington, But I

72
00:03:41,680 --> 00:03:45,240
Speaker 1: don't think we need traditional fiscal stimulus, all right. What

73
00:03:45,280 --> 00:03:48,120
Speaker 1: we need is we need to keep our our financial

74
00:03:48,160 --> 00:03:50,800
Speaker 1: systems sound and safe. And I give the fit and

75
00:03:50,840 --> 00:03:52,800
Speaker 1: all the central of the banks of the world except

76
00:03:52,840 --> 00:03:55,680
Speaker 1: maybe for the Bank of Japan hagh marks for ensuring

77
00:03:55,960 --> 00:03:59,960
Speaker 1: that banks remain liquid, that they push credit to peep

78
00:04:00,040 --> 00:04:02,880
Speaker 1: ball and companies so that they can use it. That

79
00:04:03,000 --> 00:04:04,960
Speaker 1: the only way to survive this kind of a shock

80
00:04:05,360 --> 00:04:08,520
Speaker 1: is to introducing a financing and credit into the economy

81
00:04:08,600 --> 00:04:11,720
Speaker 1: so that we can spread the pain over an affordable

82
00:04:11,800 --> 00:04:14,840
Speaker 1: piani survivable period of time. So what we need our

83
00:04:14,840 --> 00:04:18,200
Speaker 1: programs to ensure that banks, whether they want to or not,

84
00:04:18,520 --> 00:04:21,760
Speaker 1: pump credit out the companies that are suffering cash for

85
00:04:21,880 --> 00:04:25,640
Speaker 1: shore falls and household make it a credit, not a transfer,

86
00:04:25,920 --> 00:04:28,920
Speaker 1: and then use that space of time that the credit

87
00:04:28,960 --> 00:04:32,120
Speaker 1: allows to recover from what appears to be a much

88
00:04:32,120 --> 00:04:34,880
Speaker 1: bigger shock than anyone had been thinking about until recently.

89
00:04:35,120 --> 00:04:39,000
Speaker 1: So you said that that traditional uh fiscal stimulus would

90
00:04:39,040 --> 00:04:41,520
Speaker 1: not be necessarily what was required, and yet you have

91
00:04:41,560 --> 00:04:46,400
Speaker 1: a growing amount of speculation that anything from helicopter money

92
00:04:46,520 --> 00:04:50,200
Speaker 1: to bailing out entire industries would be a productive and

93
00:04:50,200 --> 00:04:53,600
Speaker 1: not only productive, but crucial part of our recovery. I'm

94
00:04:53,600 --> 00:04:55,080
Speaker 1: just going to throw this out there. A q R

95
00:04:55,160 --> 00:05:00,000
Speaker 1: Capital Management's Cliff Assness, who is a self described libertarian

96
00:05:00,160 --> 00:05:03,240
Speaker 1: in at times, said today on Twitter, I am not

97
00:05:03,320 --> 00:05:06,360
Speaker 1: a libertarian about coronavirus and say we need and I

98
00:05:06,400 --> 00:05:08,760
Speaker 1: don't think I've ever said this before, fiscal help. We

99
00:05:08,800 --> 00:05:12,520
Speaker 1: need fiscal relief for individuals and small and maybe large businesses.

100
00:05:12,560 --> 00:05:14,640
Speaker 1: If that action was fine, and those who dismiss it

101
00:05:14,680 --> 00:05:17,800
Speaker 1: are wrong, we should use all possible tools. Do you agree?

102
00:05:19,040 --> 00:05:23,120
Speaker 1: Um um? Sort of but not entirely. You know, if

103
00:05:23,120 --> 00:05:25,680
Speaker 1: this is a supply shock, all right, means we're making

104
00:05:25,760 --> 00:05:28,719
Speaker 1: less stuff. So if we give people money in their

105
00:05:28,720 --> 00:05:31,520
Speaker 1: pockets to replace the money they're not earning a right

106
00:05:31,640 --> 00:05:33,840
Speaker 1: to make the stuff that's not being produced, we're going

107
00:05:33,880 --> 00:05:35,520
Speaker 1: to have more money than good and we're going to

108
00:05:35,560 --> 00:05:38,400
Speaker 1: create an inflation. Shifting the demand curve to the right

109
00:05:38,520 --> 00:05:41,039
Speaker 1: I think is the wrong policy. Right, we need to

110
00:05:41,080 --> 00:05:43,960
Speaker 1: get that supply curve moving back to the left, and

111
00:05:44,000 --> 00:05:47,839
Speaker 1: we need the cushion what is an inevitable decline and

112
00:05:47,920 --> 00:05:50,920
Speaker 1: income and loss of income and must wealth coming out

113
00:05:50,960 --> 00:05:52,680
Speaker 1: of this, And that's when we have to start being

114
00:05:52,720 --> 00:05:55,599
Speaker 1: realistic that if we keep people away from work for

115
00:05:55,680 --> 00:05:58,200
Speaker 1: weeks or months, we're going to be poorer as a

116
00:05:58,240 --> 00:06:00,880
Speaker 1: result of that. And the challenge is not to replace

117
00:06:00,960 --> 00:06:04,799
Speaker 1: the income that's lost. You can the challenges to bridge

118
00:06:04,839 --> 00:06:07,320
Speaker 1: the adjustment to that lower level of income the lower

119
00:06:07,400 --> 00:06:10,279
Speaker 1: level of wealth so that it's survivable. So I think

120
00:06:10,279 --> 00:06:13,280
Speaker 1: that fiscal policy credit is the right tool to do that.

121
00:06:13,560 --> 00:06:15,520
Speaker 1: And the government's role in all of this is to

122
00:06:15,680 --> 00:06:19,120
Speaker 1: ensure that banks make loans the people that they normally

123
00:06:19,240 --> 00:06:21,680
Speaker 1: wouldn't make. Right, if you go to the bank, then

124
00:06:21,680 --> 00:06:23,479
Speaker 1: you say, I'm sort of cash, I need a loan.

125
00:06:23,760 --> 00:06:25,440
Speaker 1: You're not going to get it all right, when the

126
00:06:25,440 --> 00:06:27,800
Speaker 1: banks have to be prepared to make these kinds of

127
00:06:27,839 --> 00:06:31,039
Speaker 1: bridging loans, I'll call them, so that people can get

128
00:06:31,040 --> 00:06:33,920
Speaker 1: the credits they need to survive the next six months,

129
00:06:34,160 --> 00:06:36,920
Speaker 1: so that when the virus goes away, businesses are still

130
00:06:36,920 --> 00:06:40,240
Speaker 1: in business and households having lost their homes and their

131
00:06:40,360 --> 00:06:42,960
Speaker 1: life savings and all of that. So we need to

132
00:06:43,040 --> 00:06:47,400
Speaker 1: bridge through this trauma and then recover over time from it.

133
00:06:47,520 --> 00:06:49,839
Speaker 1: Carl Winbert, thanks very much for joining us. We appreciate

134
00:06:49,920 --> 00:06:53,440
Speaker 1: your thoughts as always. Uh, interesting to put in context.

135
00:06:53,800 --> 00:06:56,000
Speaker 1: I guess it's question, Lisa's just kind of how long

136
00:06:56,600 --> 00:06:59,960
Speaker 1: uh this um, the medical aspect of this at last?

137
00:07:00,040 --> 00:07:02,200
Speaker 1: Is it a month? Is a two months? Obviously the

138
00:07:02,279 --> 00:07:06,160
Speaker 1: longer ago, Lisa, the more profound the economic impact will be.

139
00:07:06,200 --> 00:07:08,200
Speaker 1: And then that raises the question of what type of

140
00:07:08,279 --> 00:07:11,040
Speaker 1: rebound will we have on the way back out. Yeah,

141
00:07:11,080 --> 00:07:13,840
Speaker 1: it's gonna be a really tricky situation. People talking about

142
00:07:13,880 --> 00:07:18,160
Speaker 1: five billion, six hundred billion dollar type of fiscal stimulus.

143
00:07:18,320 --> 00:07:21,120
Speaker 1: There's also a question of timing. How quickly, uh can

144
00:07:21,160 --> 00:07:23,680
Speaker 1: they end up getting it? Given the fact that this

145
00:07:23,760 --> 00:07:26,240
Speaker 1: seems to be imminent, there's more of a concern that

146
00:07:26,280 --> 00:07:29,600
Speaker 1: there's going to be actually a failure of some companies

147
00:07:29,640 --> 00:07:36,280
Speaker 1: to be able to make their bills. In your term,

148
00:07:36,280 --> 00:07:40,120
Speaker 1: why even the big behemoths like Apple and Facebook are

149
00:07:40,160 --> 00:07:42,400
Speaker 1: just getting hammered when a lot of people view them

150
00:07:42,520 --> 00:07:46,440
Speaker 1: as likely to be uh, you know, absolutely withstand this

151
00:07:46,640 --> 00:07:48,960
Speaker 1: and then continue to gain on the other side. David

152
00:07:49,000 --> 00:07:51,760
Speaker 1: Garrity has been tracking this, chief market strategist for leid

153
00:07:51,840 --> 00:07:54,480
Speaker 1: Law and Company and partner at bt Block. I'd love

154
00:07:54,520 --> 00:07:58,040
Speaker 1: to get your sense of of Big text involvement in Washington,

155
00:07:58,120 --> 00:08:02,640
Speaker 1: d C. Stories about how they're trying to help basically

156
00:08:02,680 --> 00:08:05,400
Speaker 1: assess testing, trying to figure out ways to do it

157
00:08:05,480 --> 00:08:07,600
Speaker 1: so that people don't have to go to the doctor's office,

158
00:08:07,640 --> 00:08:10,800
Speaker 1: as well as just gaming out hospital bed availability in

159
00:08:10,840 --> 00:08:15,000
Speaker 1: real time. How will this end up reshaping big tech

160
00:08:15,000 --> 00:08:19,040
Speaker 1: in its relationship with Washington. Well, I think to the

161
00:08:19,080 --> 00:08:22,200
Speaker 1: extent from an overall public policy standpoint, does a major

162
00:08:22,200 --> 00:08:24,560
Speaker 1: effort underway right now to try to flatten the curve

163
00:08:25,240 --> 00:08:29,360
Speaker 1: of coronavirus infection and certainly, you know, an important way

164
00:08:29,400 --> 00:08:31,840
Speaker 1: to make that happen. Apart from saying that you know,

165
00:08:31,880 --> 00:08:34,880
Speaker 1: we shouldn't have gatherings of more than fifty people in

166
00:08:34,960 --> 00:08:37,080
Speaker 1: one place for the next two months, you know, the

167
00:08:37,080 --> 00:08:39,480
Speaker 1: way to really make society operators to be able to

168
00:08:39,600 --> 00:08:44,200
Speaker 1: use technology to operate on a more distributed basis. Uh So,

169
00:08:44,360 --> 00:08:48,360
Speaker 1: you know, certainly from that standpoint, big tech has a

170
00:08:48,440 --> 00:08:51,800
Speaker 1: very significant role to play. Um you know, whether you

171
00:08:51,840 --> 00:08:54,720
Speaker 1: want to go from looking at you cloud computing companies,

172
00:08:55,200 --> 00:08:59,600
Speaker 1: uh e commerce to distributed workforce productivity names like zoom,

173
00:08:59,640 --> 00:09:04,960
Speaker 1: slad or distance learning providers such as to you. Uh So,

174
00:09:05,040 --> 00:09:07,880
Speaker 1: you know clearly we're going into a mode here for

175
00:09:08,160 --> 00:09:10,960
Speaker 1: you know, maybe the next two months of where you know,

176
00:09:11,000 --> 00:09:13,880
Speaker 1: consumers are basically going to be you know, living at

177
00:09:13,880 --> 00:09:16,839
Speaker 1: home and staying at home and working at home. And

178
00:09:16,960 --> 00:09:19,360
Speaker 1: you know what we have to think about here is

179
00:09:19,440 --> 00:09:22,520
Speaker 1: that to the extent that this is a significant crisis,

180
00:09:22,559 --> 00:09:25,240
Speaker 1: to the extent that people's behavior is being changed as

181
00:09:25,240 --> 00:09:27,679
Speaker 1: a result of it, you know, here's a real chance

182
00:09:27,720 --> 00:09:31,280
Speaker 1: for these companies to the technology sector to become even

183
00:09:31,360 --> 00:09:35,240
Speaker 1: more of an integral part of people's daily lives than

184
00:09:35,280 --> 00:09:38,360
Speaker 1: they were prior to this. So, David, I know you

185
00:09:38,440 --> 00:09:41,839
Speaker 1: have a lot of experience with technology stocks. Is it

186
00:09:41,920 --> 00:09:45,640
Speaker 1: your call um that you know, these are still fundamentally

187
00:09:45,720 --> 00:09:48,200
Speaker 1: you know, good businesses going into the crisis. They're gonna

188
00:09:48,200 --> 00:09:50,360
Speaker 1: be fundamentally good businesses coming out of the crisis. And

189
00:09:50,400 --> 00:09:53,880
Speaker 1: you're going to have some extraordinary entry points. Um. Or

190
00:09:54,080 --> 00:09:56,560
Speaker 1: you just kind of scared about the valuation, you might

191
00:09:56,600 --> 00:09:59,120
Speaker 1: want to get more defensive given this tremendous amount of

192
00:09:59,160 --> 00:10:03,040
Speaker 1: uncertaint involved they have. I mean, look, these are these

193
00:10:03,080 --> 00:10:06,920
Speaker 1: are certainly going to be core holdings for anybody's portfolio

194
00:10:07,040 --> 00:10:09,920
Speaker 1: we think going forward. Um. You know, the question that

195
00:10:09,960 --> 00:10:12,360
Speaker 1: we have to ask ourselves is sort of looking at

196
00:10:12,880 --> 00:10:16,320
Speaker 1: broader market levels, you know, where does it perhaps become

197
00:10:16,880 --> 00:10:19,240
Speaker 1: you know, more balanced in terms of the risk reward

198
00:10:19,360 --> 00:10:22,040
Speaker 1: ratio um. You know, sort of looking at the SMP

199
00:10:22,200 --> 00:10:25,839
Speaker 1: five hundreds, historically, uh, the SMP five hundred kind of

200
00:10:25,840 --> 00:10:29,439
Speaker 1: bottoms out at thirteen times prior PEK earnings twenty times

201
00:10:29,520 --> 00:10:32,800
Speaker 1: current trough. You know, if we think that SP five

202
00:10:32,840 --> 00:10:35,920
Speaker 1: hurtings are gonna be down this year, you know, that

203
00:10:35,960 --> 00:10:37,920
Speaker 1: kind of puts a floor on the SMP five hundred

204
00:10:37,960 --> 00:10:42,719
Speaker 1: about level. You know, granted that was down from what

205
00:10:42,840 --> 00:10:45,920
Speaker 1: we were trading pre market, but it certainly says you

206
00:10:45,960 --> 00:10:48,040
Speaker 1: know that that's a level where we think that kind

207
00:10:48,040 --> 00:10:51,680
Speaker 1: of in between here and there, um, you know, there's

208
00:10:51,720 --> 00:10:54,360
Speaker 1: gonna be some real opportunities for investors to come in

209
00:10:54,720 --> 00:10:57,520
Speaker 1: and pick the right names. Uh. And and certainly we

210
00:10:57,600 --> 00:10:59,880
Speaker 1: think that these names you mentioned earlier are going to

211
00:11:00,040 --> 00:11:02,600
Speaker 1: be playing an even more important part in people's lives

212
00:11:02,800 --> 00:11:05,240
Speaker 1: going forward than they were before. I wanted to pick

213
00:11:05,320 --> 00:11:08,480
Speaker 1: up on exactly that point because certainly one aspect of

214
00:11:08,520 --> 00:11:13,080
Speaker 1: this whole epidemic pandemic has been the importance of being

215
00:11:13,120 --> 00:11:18,400
Speaker 1: interconnected via social media, via Slack, via zoom. And I'm

216
00:11:18,440 --> 00:11:22,120
Speaker 1: wondering who are the biggest winners that maybe are not

217
00:11:22,240 --> 00:11:26,280
Speaker 1: as obvious as the Zooms and the slacks of the world. Well,

218
00:11:26,320 --> 00:11:28,679
Speaker 1: I mean, certainly, if we're looking at places where it's

219
00:11:28,679 --> 00:11:31,680
Speaker 1: you know, safe to keep your data stored, cloud computing

220
00:11:31,679 --> 00:11:34,079
Speaker 1: continues to be quite strong. I think one of the

221
00:11:34,120 --> 00:11:36,640
Speaker 1: names you mentioned earlier in terms of distance learning, there's

222
00:11:36,679 --> 00:11:40,200
Speaker 1: a company to you, mid cap company, about two billion

223
00:11:40,240 --> 00:11:45,680
Speaker 1: dollar market cap. They work with educational academic institutions to

224
00:11:45,760 --> 00:11:49,599
Speaker 1: help enable their distance learning capabilities in terms of the

225
00:11:49,600 --> 00:11:53,760
Speaker 1: ability with their programs out um, you know, to students.

226
00:11:53,800 --> 00:11:57,239
Speaker 1: And certainly from that standpoint, that's going to be significant

227
00:11:57,240 --> 00:12:01,800
Speaker 1: going forward. Um, we know that Pierce Publishing Company had

228
00:12:01,840 --> 00:12:05,400
Speaker 1: a company called the Blackboard that they had acquired that

229
00:12:05,400 --> 00:12:07,120
Speaker 1: that on its own, I think is a really small

230
00:12:07,160 --> 00:12:09,680
Speaker 1: part of the overall enterprise, and maybe not may not

231
00:12:09,800 --> 00:12:12,520
Speaker 1: be so much of a cure play as some of

232
00:12:12,559 --> 00:12:15,680
Speaker 1: these other names. So you know, clearly we're looking at

233
00:12:15,720 --> 00:12:19,400
Speaker 1: a market here where investors are looking for large liquid names,

234
00:12:19,480 --> 00:12:23,520
Speaker 1: albeit today to sell to raise cash, but looking at

235
00:12:23,600 --> 00:12:27,120
Speaker 1: large liquid names that people can easily own a part

236
00:12:27,120 --> 00:12:28,960
Speaker 1: of going forward, you know, looking at some of the

237
00:12:29,000 --> 00:12:31,480
Speaker 1: names that have been mentioned along this line, even a

238
00:12:31,520 --> 00:12:34,360
Speaker 1: were to be Slack re Zoom, I think are also

239
00:12:34,720 --> 00:12:37,760
Speaker 1: two quite good names um to be looking at here

240
00:12:37,800 --> 00:12:41,319
Speaker 1: as well. There's also a question about cybersecurity, especially as

241
00:12:41,360 --> 00:12:43,480
Speaker 1: more of the information moves to the cloud, and this

242
00:12:43,640 --> 00:12:45,840
Speaker 1: is all the more relevant today when we learned the

243
00:12:45,920 --> 00:12:49,199
Speaker 1: US Health and Human Services Department suffered a cyber attack

244
00:12:49,559 --> 00:12:52,400
Speaker 1: on its computer system Sunday night. It said that this

245
00:12:52,520 --> 00:12:55,800
Speaker 1: did not affect its response, the timing, or the scope

246
00:12:56,160 --> 00:13:00,280
Speaker 1: of its response to the spreading coronavirus. But still very

247
00:13:00,360 --> 00:13:04,079
Speaker 1: much front and center is the cyber security. What's your

248
00:13:04,160 --> 00:13:07,320
Speaker 1: sense about how good that is in terms of the

249
00:13:07,360 --> 00:13:09,960
Speaker 1: big tech giants is an increasing amount of business and

250
00:13:10,000 --> 00:13:14,960
Speaker 1: activity moves online. Now, I mean you've raised a very

251
00:13:15,040 --> 00:13:17,079
Speaker 1: very good point because you know, not only are we

252
00:13:17,200 --> 00:13:21,120
Speaker 1: operating operating in a real economy environment here where people's

253
00:13:21,160 --> 00:13:25,440
Speaker 1: personal hygiene is critical, but also to the extent that

254
00:13:25,520 --> 00:13:29,559
Speaker 1: life is shifting more to be supported online or virtually

255
00:13:30,480 --> 00:13:34,440
Speaker 1: looking at our technology, our tech hygiene is critical in

256
00:13:34,480 --> 00:13:38,800
Speaker 1: this regarden. So, yes, cybersecurity is an area where there

257
00:13:38,960 --> 00:13:42,760
Speaker 1: is an alarming a number of security breaches or hacks,

258
00:13:43,160 --> 00:13:45,440
Speaker 1: and so from that standpoint, you know, the need to

259
00:13:45,559 --> 00:13:50,120
Speaker 1: improve cybersecurity is necessary from here certainly as we're looking

260
00:13:50,160 --> 00:13:53,240
Speaker 1: at an environment right now, people's attention is focused on

261
00:13:53,320 --> 00:13:54,800
Speaker 1: you know, what are we going to be doing here

262
00:13:55,200 --> 00:13:58,440
Speaker 1: to support people's incomes? Is you know, unemployment rates probably

263
00:13:58,440 --> 00:14:02,240
Speaker 1: spike over ten percent more um. You know, we also

264
00:14:02,440 --> 00:14:05,440
Speaker 1: be thinking about a public private sector initiative that goes

265
00:14:05,520 --> 00:14:09,800
Speaker 1: more towards enhancing the cybersecurity not just of the U. S. Government,

266
00:14:10,320 --> 00:14:13,760
Speaker 1: but that of the individual citizens. David Garretty, thank you

267
00:14:13,800 --> 00:14:16,480
Speaker 1: so much for joining us David Garritty laid Law and

268
00:14:16,520 --> 00:14:18,840
Speaker 1: Company sharing his thoughts on the market. We always appreciate

269
00:14:18,880 --> 00:14:21,640
Speaker 1: David's thoughts particularly on technology. And again, you know, I

270
00:14:21,640 --> 00:14:24,160
Speaker 1: think a lot investors are selling tech along with everything else.

271
00:14:24,400 --> 00:14:29,600
Speaker 1: As David mentioned, I want to take a look at

272
00:14:29,600 --> 00:14:33,760
Speaker 1: the medical side of coronavirus, in particular, how we track it,

273
00:14:34,000 --> 00:14:37,240
Speaker 1: how we test for it, and frankly, how close we

274
00:14:37,280 --> 00:14:39,200
Speaker 1: are to actually crying it or solving it, or a

275
00:14:39,280 --> 00:14:41,600
Speaker 1: merely rating at least the effects. Luckily, we have Max

276
00:14:41,640 --> 00:14:45,280
Speaker 1: Nis and Bloomberg opinion columnists covering all things healthcare with

277
00:14:45,440 --> 00:14:48,560
Speaker 1: us today. Max, I want to start with Anthony Fauci,

278
00:14:49,080 --> 00:14:51,360
Speaker 1: who is the director of the National Institute for Allergy

279
00:14:51,400 --> 00:14:55,640
Speaker 1: and Infectious Disease. Yesterday he was testifying in front of Congress,

280
00:14:56,000 --> 00:14:59,240
Speaker 1: and he said, he admitted that it was a failing

281
00:14:59,320 --> 00:15:01,200
Speaker 1: of the US health care system that we did not

282
00:15:01,360 --> 00:15:05,560
Speaker 1: have sufficient testing at the outset. Can you just walk

283
00:15:05,760 --> 00:15:09,640
Speaker 1: through why we did not have better testing available right

284
00:15:09,680 --> 00:15:12,360
Speaker 1: away so that we could track and isolate people immediately.

285
00:15:13,200 --> 00:15:17,200
Speaker 1: So there you know, any number of reasons or failures

286
00:15:17,240 --> 00:15:20,800
Speaker 1: for this um you know, a failure of cooperation between

287
00:15:20,840 --> 00:15:24,120
Speaker 1: agencies like the CDC and the f D, a failure

288
00:15:24,200 --> 00:15:28,560
Speaker 1: to bring in private companies and state labs rapidly enough,

289
00:15:29,040 --> 00:15:32,440
Speaker 1: decision at the outset instead of using w h O

290
00:15:32,560 --> 00:15:35,920
Speaker 1: developed tests, one that's been deployed all over the world.

291
00:15:36,240 --> 00:15:38,960
Speaker 1: We decided to develop our own, which turned out to

292
00:15:39,000 --> 00:15:44,280
Speaker 1: have problems. The introducing those problems obviously created difficulties and

293
00:15:44,280 --> 00:15:47,400
Speaker 1: and slow the raw and beyond that, um just an

294
00:15:47,440 --> 00:15:50,520
Speaker 1: overall decision by the government for um, you know, not

295
00:15:50,600 --> 00:15:56,120
Speaker 1: necessarily the best reasons to restrict deliberately the number of

296
00:15:56,160 --> 00:15:59,680
Speaker 1: tests that were deployed and developed, and and like the

297
00:15:59,760 --> 00:16:02,120
Speaker 1: number are people that were tested, limiting it only to

298
00:16:02,200 --> 00:16:05,280
Speaker 1: people with the direct travel history to China in spite

299
00:16:05,360 --> 00:16:07,720
Speaker 1: of the fact that there was you know, already evidence

300
00:16:07,720 --> 00:16:10,240
Speaker 1: of spread in other parts of the world, and you

301
00:16:10,240 --> 00:16:13,400
Speaker 1: know the reality that the earlier you know, better to

302
00:16:13,520 --> 00:16:16,800
Speaker 1: overtest and under test. And we really didn't even get

303
00:16:16,840 --> 00:16:20,240
Speaker 1: to that that mindset until just a few weeks ago.

304
00:16:20,480 --> 00:16:25,640
Speaker 1: So failure of leadership, failure of science, failure on on

305
00:16:25,760 --> 00:16:28,560
Speaker 1: many many levels has led to this this point, Max,

306
00:16:28,640 --> 00:16:31,240
Speaker 1: where are we right now in terms of the number

307
00:16:31,240 --> 00:16:35,400
Speaker 1: of kits we have in this country, how widely dispersed

308
00:16:35,640 --> 00:16:38,400
Speaker 1: they are right now, how easy is it for somebody

309
00:16:38,440 --> 00:16:40,760
Speaker 1: to get a test? And and just kind of where

310
00:16:40,760 --> 00:16:43,640
Speaker 1: are we today? Do you think Unfortunately, all that we

311
00:16:43,720 --> 00:16:47,240
Speaker 1: really have are sort of these ad hoc estimates. UM.

312
00:16:47,360 --> 00:16:51,240
Speaker 1: I'll point people to former FDA Commissioner Scott Gottlieb, who

313
00:16:51,240 --> 00:16:54,440
Speaker 1: has been you know, talking to state labs of the CDC,

314
00:16:54,880 --> 00:16:58,240
Speaker 1: private companies trying to come up with a reasonable estimate. UM.

315
00:16:58,280 --> 00:17:01,240
Speaker 1: So we we really don't have a confer number unfortunately,

316
00:17:01,800 --> 00:17:04,280
Speaker 1: And UM it seems to be the case that you know,

317
00:17:04,320 --> 00:17:07,200
Speaker 1: your ability to get tested really depends on where you are.

318
00:17:07,280 --> 00:17:10,160
Speaker 1: Are you in a state that that took early steps

319
00:17:10,200 --> 00:17:13,520
Speaker 1: to to you know, develop its own tests to stand

320
00:17:13,600 --> 00:17:16,520
Speaker 1: up at more capacity than it needed any any given

321
00:17:16,560 --> 00:17:18,640
Speaker 1: moment um, where we're still not at a point where

322
00:17:18,640 --> 00:17:21,440
Speaker 1: everyone who needs to be tested can be unfortunately, and

323
00:17:21,720 --> 00:17:24,159
Speaker 1: probably won't be for a little bit to come. Although

324
00:17:24,440 --> 00:17:28,359
Speaker 1: Anthony Fauci did say today that he expects the number

325
00:17:28,400 --> 00:17:32,320
Speaker 1: of tests to increase dramatically over the upcoming weeks and

326
00:17:32,359 --> 00:17:35,360
Speaker 1: part because the US government is partnering with private companies.

327
00:17:35,359 --> 00:17:37,960
Speaker 1: Can you talk a little bit about that, Yeah, absolutely,

328
00:17:38,040 --> 00:17:40,520
Speaker 1: So this is basically you know, looking to companies like

329
00:17:40,640 --> 00:17:43,760
Speaker 1: lab Corp and and Quests, UM, you know, these sort

330
00:17:43,760 --> 00:17:46,959
Speaker 1: of brand name companies that have labs all over the country,

331
00:17:47,280 --> 00:17:50,160
Speaker 1: and UM, just basically making sure that they too are

332
00:17:50,200 --> 00:17:52,520
Speaker 1: are part of this effort that you know, if if

333
00:17:52,560 --> 00:17:55,720
Speaker 1: a public lab is overwhelmed, if there isn't one available,

334
00:17:56,200 --> 00:17:59,480
Speaker 1: send it to these companies and they're finally beginning to

335
00:17:59,480 --> 00:18:02,520
Speaker 1: to stand up capacity to to get you know, validate

336
00:18:02,560 --> 00:18:05,040
Speaker 1: these tests and begin to run them. That will be

337
00:18:05,240 --> 00:18:08,880
Speaker 1: a huge help because they're they're more dispersed um and

338
00:18:08,880 --> 00:18:11,199
Speaker 1: and potentially you know, quite capable of running a lot

339
00:18:11,240 --> 00:18:13,000
Speaker 1: of tests. You know, we're not at the stage where

340
00:18:13,000 --> 00:18:15,280
Speaker 1: even they are are going to provide all the capacity

341
00:18:15,320 --> 00:18:18,000
Speaker 1: we need, but they will certainly help a lot. Let's

342
00:18:18,000 --> 00:18:20,440
Speaker 1: talk about cost, Max, I know you're out with account.

343
00:18:20,560 --> 00:18:24,600
Speaker 1: A really interesting coronavirus crisis makes a case for medicare

344
00:18:25,280 --> 00:18:27,760
Speaker 1: for all. Talk to us about that. Does that actually

345
00:18:27,800 --> 00:18:31,320
Speaker 1: have some legs? Yeah, so, you know, the it's a

346
00:18:31,440 --> 00:18:37,320
Speaker 1: uniquely American um phenomenon that in addition to people worrying

347
00:18:37,359 --> 00:18:40,760
Speaker 1: about getting coronavirus, if they're smart, they will also be

348
00:18:40,840 --> 00:18:44,760
Speaker 1: worried about the cost of getting coronavirus um. You know.

349
00:18:44,800 --> 00:18:47,919
Speaker 1: The first step is obviously testing. There's been an effort

350
00:18:48,000 --> 00:18:51,280
Speaker 1: from insurers and from individual states and the government to

351
00:18:51,359 --> 00:18:53,640
Speaker 1: make sure that that that that people won't be faced

352
00:18:53,640 --> 00:18:55,720
Speaker 1: with costs. But that's you know, you actually have to

353
00:18:55,760 --> 00:18:58,959
Speaker 1: take really aggressive steps to make sure that even testing

354
00:18:58,960 --> 00:19:01,520
Speaker 1: in a pandemic is not going to cost people thousands

355
00:19:01,560 --> 00:19:04,200
Speaker 1: of dollars. And then you get to the stage of

356
00:19:04,200 --> 00:19:07,320
Speaker 1: of whether when people actually have a hospital stay. UM,

357
00:19:07,400 --> 00:19:09,479
Speaker 1: you know a lot of people that don't use their

358
00:19:09,520 --> 00:19:13,359
Speaker 1: health insurance that often assume that they're protected from unexpected bills.

359
00:19:13,400 --> 00:19:15,960
Speaker 1: But if you end up with an inpatient hospital stay,

360
00:19:16,280 --> 00:19:19,920
Speaker 1: you're gonna hit your deductible UM, You're gonna potentially face coinsurance,

361
00:19:20,359 --> 00:19:22,280
Speaker 1: and that will get you to your plans out of

362
00:19:22,320 --> 00:19:25,440
Speaker 1: pocket maximum, which in many cases is in the thousands

363
00:19:25,440 --> 00:19:28,240
Speaker 1: of dollars. And that's a financial strain on many companies.

364
00:19:28,359 --> 00:19:30,919
Speaker 1: And that's the best case scenario. There. There are steps

365
00:19:30,920 --> 00:19:34,120
Speaker 1: of the government can take in an emergency to kind

366
00:19:34,119 --> 00:19:36,440
Speaker 1: of prevent that from happening, to protect people from costs.

367
00:19:36,760 --> 00:19:39,280
Speaker 1: UH still in the works and and unclear whether it

368
00:19:39,280 --> 00:19:41,480
Speaker 1: will be broad enough to help. I'd argue that you

369
00:19:41,560 --> 00:19:43,439
Speaker 1: might want a system in this what I arg you

370
00:19:43,520 --> 00:19:45,600
Speaker 1: might call them where you don't have to take emergency

371
00:19:45,640 --> 00:19:48,400
Speaker 1: steps to protect people from those costs. Max Kinison, thanks

372
00:19:48,400 --> 00:19:51,040
Speaker 1: so much for joining us. We always appreciate your perspective

373
00:19:51,080 --> 00:19:53,879
Speaker 1: on all things healthcare. Maximison is a biotech farm at

374
00:19:53,920 --> 00:19:56,359
Speaker 1: Healthcare Commas for Bloomberg Opinion. Joining is here in a

375
00:19:56,359 --> 00:19:59,160
Speaker 1: Bloomberg eleven three oh studio. Thank you, Max. I mean, honestly,

376
00:19:59,280 --> 00:20:01,480
Speaker 1: that's just to me. Highlights a lot of weak spots,

377
00:20:01,800 --> 00:20:04,640
Speaker 1: and you know, there's there's a question of how much

378
00:20:04,720 --> 00:20:07,080
Speaker 1: is going to be temporary and how much will this

379
00:20:07,440 --> 00:20:11,439
Speaker 1: entire episode reshape the way some people think about a

380
00:20:11,520 --> 00:20:14,639
Speaker 1: variety of different issues, this medicaid from medicare for all.

381
00:20:14,680 --> 00:20:16,439
Speaker 1: I think we'll be back on the table, certainly for

382
00:20:16,480 --> 00:20:18,560
Speaker 1: the Democrats as they think about, you know, kind of

383
00:20:18,560 --> 00:20:22,480
Speaker 1: how to position uh, the US against some of these pandemics.

384
00:20:24,240 --> 00:20:26,480
Speaker 1: Thanks for listening to the Bloomberg P and L podcast.

385
00:20:26,640 --> 00:20:29,280
Speaker 1: You can subscribe and listen to interviews at Apple Podcasts

386
00:20:29,320 --> 00:20:32,439
Speaker 1: or whatever podcast platform you prefer. Paul Sweeney, I'm on

387
00:20:32,440 --> 00:20:35,119
Speaker 1: Twitter at pt Sweeney. I'm Lisa Abram Woyds. I'm on

388
00:20:35,119 --> 00:20:38,159
Speaker 1: Twitter at Lisa abramoits one before the podcast. You can

389
00:20:38,160 --> 00:20:40,560
Speaker 1: always catch us worldwide on Bloomberg Radio.