WEBVTT - Surveillance: Eli Lilly CEO Sees Brighter Future 0:00:09.880 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene Jaily. 0:00:13.960 --> 0:00:17.560 We bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.480 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:27.880 Bloomberg dot Com, and of course on the Bloomberg. Let's 0:00:27.920 --> 0:00:30.040 do this. Let's dispense with the formalities right now and 0:00:30.080 --> 0:00:33.000 get to David Ricks Eli Lily chairman and CEO, and 0:00:33.040 --> 0:00:35.040 I do this. John and Lisa have a lot of 0:00:35.120 --> 0:00:38.120 questions about the news yesterday, But David, I think there's 0:00:38.440 --> 0:00:43.680 massive confusion over all of these fancy words, and particularly 0:00:43.680 --> 0:00:49.320 around vaccine, around anybody treatment. We conflate bacterial and virus 0:00:49.440 --> 0:00:53.240 therapies on top of each other. How does a vaccine 0:00:53.440 --> 0:00:58.520 differ from the antibody treatment you announced yesterday? Well, thanks 0:00:58.560 --> 0:01:00.880 for me on Tom, and it's any news last night 0:01:00.880 --> 0:01:04.080 with the emergency Use authorization in the US for our 0:01:04.160 --> 0:01:08.800 monoclonal antibody neutralizing antibody, which is a therapy that you're 0:01:09.200 --> 0:01:12.480 to be given in this approval if you have new, 0:01:12.720 --> 0:01:17.440 newer onset disease, so a positive test and symptoms, and 0:01:17.480 --> 0:01:19.200 particularly if you fall into a high risk group, you 0:01:19.240 --> 0:01:22.360 have underlying conditions or you're older, then you can take 0:01:22.440 --> 0:01:25.400 this therapy and in our studies that reduced the probability 0:01:25.480 --> 0:01:30.040 that you go to the hospital pretty dramatically by sevent um. 0:01:30.120 --> 0:01:33.880 So that's an important step, another tool now UM to 0:01:34.040 --> 0:01:37.200 help manage this disease just when we need it most there. 0:01:37.240 --> 0:01:40.039 In terms of how it works, you're asking what we 0:01:40.080 --> 0:01:43.440 did actually was UM. When your body is infected with 0:01:43.480 --> 0:01:46.679 a virus, it amounts a variety of immune responses. One 0:01:46.720 --> 0:01:49.920 of them is we create antibodies, which have been much 0:01:49.920 --> 0:01:53.800 talked about in these antibody testing UM. These antibodies, UH 0:01:54.240 --> 0:01:56.520 lock up the virus and dispose of it. What we 0:01:56.560 --> 0:02:01.440 did was took antibodies from surviving patients early in the pandemic. 0:02:01.600 --> 0:02:05.040 We isolated the very most potent ones in one in 0:02:05.080 --> 0:02:07.560 this case, and now we make it in a factory 0:02:07.600 --> 0:02:11.400 synthetically and give it medicine. This is really important. David Ricks. 0:02:11.440 --> 0:02:17.600 Can you suggest, just suggest that this bacterial like anibody therapy, 0:02:17.760 --> 0:02:21.680 almost like a bacterial antibiotic, could be a substitute for 0:02:21.760 --> 0:02:25.760 a true vaccine. Well, we're studying UM what we call 0:02:25.880 --> 0:02:29.200 passive immunization in a in a setting where you're trying 0:02:29.240 --> 0:02:32.160 to prevent spread. In our case, we're looking at spread 0:02:32.200 --> 0:02:36.440 within nursing home facilities. It's similar to vaccination in a way. 0:02:36.560 --> 0:02:39.480 So when you get a vaccine, we introduce a killed 0:02:39.600 --> 0:02:42.760 or modified version of a part of a virus, and 0:02:42.840 --> 0:02:45.519 your body recognizes that as foreign and mounts its own 0:02:45.520 --> 0:02:48.320 antibody response. Here, what we're doing is we're giving you 0:02:48.360 --> 0:02:51.880 the antibody response of someone else prior to getting sick. 0:02:51.880 --> 0:02:54.720 It's in a study, it's not approved by the FDA, 0:02:54.760 --> 0:02:56.800 and we don't have the data yet, but that's a 0:02:56.880 --> 0:02:59.440 very interesting approach, and if we look at other viruses 0:02:59.480 --> 0:03:02.800 like ebol, even this was the setting where these antibodies 0:03:02.840 --> 0:03:05.400 made the biggest difference. Of course in the US, and 0:03:05.400 --> 0:03:08.280 I think around the world, nursing home patients, elderly nursing 0:03:08.280 --> 0:03:10.440 comes are at the highest risk. So this would be 0:03:10.480 --> 0:03:13.480 an important positive event if it occurred, and we should 0:03:13.480 --> 0:03:16.200 have that data in the coming weeks. They have to 0:03:16.200 --> 0:03:18.679 build on what Tom's discussing. I think we're trying to 0:03:18.720 --> 0:03:20.480 ask the question as to whether we need a multi 0:03:20.480 --> 0:03:23.160 pronged approach here, not just the advance when we heard 0:03:23.160 --> 0:03:26.320 from Fiser yesterday, but maybe also complemented by what you're 0:03:26.320 --> 0:03:27.880 doing as well. One thing that stuck out for us 0:03:27.880 --> 0:03:31.440 all yesterday, it's just the storage of the m RNA 0:03:31.639 --> 0:03:34.760 vaccine that fights are moving forward with, and how difficult 0:03:34.760 --> 0:03:38.760 it is to store it really really freezing cold temperatures day. 0:03:38.800 --> 0:03:41.560 Can you speak to that, the developments there on that side, 0:03:41.560 --> 0:03:44.120 and how difficult it will be actually to distribute something 0:03:44.200 --> 0:03:49.720 like that widely and everywhere. Well, for for the messenger 0:03:49.760 --> 0:03:52.760 our inn A vaccines, they are fragile molecules, so they 0:03:52.760 --> 0:03:55.320 need to be held at a very very low temperature. 0:03:55.760 --> 0:03:58.760 That will likely not I don't think that's going to 0:03:58.800 --> 0:04:02.480 be a major barrier UM. Once this is broadly available 0:04:02.520 --> 0:04:06.920 in developed markets with advanced medical systems UM, where it 0:04:07.000 --> 0:04:11.839 becomes a problem is where refrigeration and available capacities UM 0:04:11.880 --> 0:04:14.880 in developing countries. UM. You know, it's gonna be much 0:04:14.920 --> 0:04:18.280 tougher and we'll take longer. That's why we have uh. 0:04:18.360 --> 0:04:21.600 You know, two of the leading ten UM vaccines are 0:04:21.680 --> 0:04:24.760 using this technology. Eight aren't and likely won't have those 0:04:25.160 --> 0:04:28.880 refrigeration constriction restrictions. I suspect some of those will work 0:04:28.920 --> 0:04:32.200 as well. I bet on that, and we'll likely end 0:04:32.279 --> 0:04:35.640 up with multiple shots on goal with vaccines. In the meantime, 0:04:35.680 --> 0:04:37.480 none of them will work a percent of the time, 0:04:37.920 --> 0:04:40.960 and back to the original question, will still need medicines 0:04:41.360 --> 0:04:44.159 like our anibody therapy to help those that will still 0:04:44.200 --> 0:04:46.760 get sick, hopefully at a much lower rate as we 0:04:46.800 --> 0:04:50.599 approach something like um herd immunity, but you'll still have 0:04:50.680 --> 0:04:54.720 endemic disease and we'll need therapies we have. There's many 0:04:54.760 --> 0:04:58.559 examples where this is true, including common respiratory viruses like RSV, 0:04:58.800 --> 0:05:02.080 where we have both vaccination and antibodies. They can go together, 0:05:02.160 --> 0:05:03.920 but together. I mean this is in the last forty 0:05:03.920 --> 0:05:08.000 eight hours we have two important developments in the fight 0:05:08.000 --> 0:05:11.000 against COVID nineteen. I think the future is looking more 0:05:11.040 --> 0:05:13.240 certain and brighter for sure. To build though on what 0:05:13.320 --> 0:05:16.680 John is talking about, there are some practical concerns as 0:05:16.680 --> 0:05:19.200 all of the pharmaceutical companies try to ramp up production, 0:05:19.640 --> 0:05:23.560 and I'm wondering supply chain issues, especially as a pandemic worsens. 0:05:23.640 --> 0:05:26.800 The idea that all of these different pharmaceutical companies are 0:05:26.839 --> 0:05:29.560 trying to go for the same thing and probably sourcing 0:05:29.640 --> 0:05:32.480 some of the same uh some of the same substances, 0:05:32.520 --> 0:05:35.360 as well as using some of the same staffers, how 0:05:35.600 --> 0:05:38.680 well can you ramp up production of the antibody therapies 0:05:38.760 --> 0:05:41.960 to meet demand in the next couple of months. Well, 0:05:41.960 --> 0:05:45.160 I wouldn't worry so much about that competition phase where 0:05:45.160 --> 0:05:48.960 we're competing our ideas. I think once it's clear they're winners, 0:05:49.000 --> 0:05:52.080 you'll see the industry come together to make product at scale. 0:05:52.279 --> 0:05:56.080 That's already occurred in the antibody space where Rosian, Regenera 0:05:56.120 --> 0:05:58.120 and who have a different approach from Lily's, have teamed up. 0:05:58.320 --> 0:06:00.040 We've teamed up with am Gin and then all of 0:06:00.120 --> 0:06:04.320 the largest contract manufacturing organizations in the world, like Samsung 0:06:04.360 --> 0:06:07.839 and Fuji to build out that supply base. So I 0:06:07.880 --> 0:06:12.159 don't think you're we're wasting material by by competing in 0:06:12.160 --> 0:06:15.760 that way. Of course, antibodies are complicated to make, one 0:06:15.800 --> 0:06:18.960 of the most complicated medicines we make, and we usually 0:06:19.000 --> 0:06:22.680 reserve them for severe disease like cancer and autommunity. Here 0:06:22.720 --> 0:06:26.120 we're talking about treating thousands millions of people potentially with 0:06:26.160 --> 0:06:29.039 these antibodies. It will strain that system and we will 0:06:29.080 --> 0:06:32.760 have scarcity, that's for sure. That's why the FDA last night, 0:06:32.800 --> 0:06:34.800 when they approved this, really asked doctors to use it 0:06:34.839 --> 0:06:37.840 in the highest risk patients. That's appropriate, so we use 0:06:37.880 --> 0:06:41.520 it where it matters most these a serious issues. We 0:06:41.560 --> 0:06:43.719 have about thirty seconds left and i'd i'd love for 0:06:43.720 --> 0:06:45.440 you to do me a favor on just the light 0:06:45.520 --> 0:06:48.120 and note, can you explain the offside rule to Tom 0:06:48.200 --> 0:06:51.120 Kane and about twenty seconds? Can you do that for us? 0:06:51.640 --> 0:06:55.200 You're talking about in football? Yes, of course offside just 0:06:55.320 --> 0:06:58.360 when when the offensive players in front of the defensive 0:06:58.360 --> 0:07:01.120 player prior to the ball being struck. Of course, once 0:07:01.120 --> 0:07:03.080 the ball struck he can run in front. It doesn't matter. 0:07:03.520 --> 0:07:06.760 That's different from hockey, where the blue line is what matters. Oh, 0:07:06.800 --> 0:07:09.080 thank you, that's very good, David Rickster. And of course 0:07:09.600 --> 0:07:12.440 the sport of Eli lily to our Olympic Committee which 0:07:12.440 --> 0:07:22.120 they've been committed to for for many years. Last week 0:07:22.160 --> 0:07:25.320 it was Guernsey in the U S election. This week 0:07:25.360 --> 0:07:30.200 it's the great rotation East Anglia and Latin bat Chappa 0:07:30.720 --> 0:07:34.080 is joining us. Now she's sitting there wondering what is 0:07:34.080 --> 0:07:36.280 it about to happen on this show? Join us from 0:07:36.280 --> 0:07:38.760 sock Jan she's the head of US right strategy and 0:07:38.800 --> 0:07:41.680 a place to say. She's still here. So Batra, let's 0:07:41.680 --> 0:07:44.440 just start with the bond market move of yesterday. You 0:07:44.560 --> 0:07:49.400 first take please, a spectacular move higher in in yield, 0:07:49.520 --> 0:07:52.920 and you know, basically the market has been all over 0:07:52.960 --> 0:07:55.480 the place supposed to be unwe the reflation trade after 0:07:55.640 --> 0:07:57.560 the election, and then we had to reflate in a 0:07:57.720 --> 0:08:01.640 rush yesterday. Um, so we've we've broken through some key 0:08:01.920 --> 0:08:04.400 uh you know, technical levels yesterday, and I think that 0:08:04.480 --> 0:08:06.720 they set off, like you said with with equities set 0:08:06.720 --> 0:08:08.600 off in the bond market could have legs as well. 0:08:09.040 --> 0:08:12.600 There's just a lot of cash in the sidelines that 0:08:12.680 --> 0:08:14.960 needs to be put to work, and if there's an opportunity, 0:08:15.000 --> 0:08:17.280 I think you're going to see a departure away from 0:08:17.280 --> 0:08:20.559 bonds into into risky assets. It's about a really important question. 0:08:20.600 --> 0:08:22.840 I did the math yesterday. I used JP Morgan just 0:08:22.920 --> 0:08:26.120 as a giant financial success. And yes it's come off 0:08:26.160 --> 0:08:29.560 the bottom, but it's nowhere back to the pre Valentine's 0:08:29.600 --> 0:08:32.880 Day trend. It needs to go up another fourteen percent 0:08:33.280 --> 0:08:35.400 sort of to get back to trend. Don't call me 0:08:35.400 --> 0:08:38.080 on that, folks, Those are rough numbers. Did you see 0:08:38.080 --> 0:08:42.959 a Catharsis yesterday going upper? Job so Bradra that did 0:08:42.960 --> 0:08:46.000 you see a Catharsis that speaks to a new bull 0:08:46.040 --> 0:08:49.600 market or a new leg of a bowl market. Well, 0:08:49.600 --> 0:08:51.640 I'm not an equity strategist, so I kind of a 0:08:51.679 --> 0:08:54.559 comment on the on the on the on the equity market, 0:08:54.600 --> 0:08:57.680 but from the bond side of the equation, I think 0:08:57.760 --> 0:08:59.920 one of the things that happened after the election was 0:09:00.160 --> 0:09:02.160 positioning was a lot cleaner. There were a lot of 0:09:02.200 --> 0:09:05.720 shorts going into the into the elections that got cleaned up. 0:09:05.760 --> 0:09:08.160 And when we got this sort of surprise news from Fiser, 0:09:08.640 --> 0:09:11.160 you saw this this sort of you know, massive sell 0:09:11.240 --> 0:09:15.319 off in bonds. And I think that the going forward, 0:09:15.480 --> 0:09:18.640 what the market is going to be focused on is is, 0:09:18.679 --> 0:09:21.360 like you mentioned earlier about what happens on the vaccine 0:09:21.360 --> 0:09:23.840 side of the equation. Um, you know, there's lots of 0:09:23.880 --> 0:09:26.280 logistical issues that need to be dealt with. It's a 0:09:26.320 --> 0:09:29.679 it's a it's a very large deployment from perhaps several 0:09:29.760 --> 0:09:32.880 different vaccine makers, and and how that gets ruled out 0:09:33.040 --> 0:09:35.360 is going to be very key on how the bond 0:09:35.400 --> 0:09:38.880 market reacts and how equities react as well. And I 0:09:38.920 --> 0:09:41.559 think for for a change, you're gonna see more correlation 0:09:42.400 --> 0:09:45.480 or sort of more negative correlation between equities and bonds 0:09:45.520 --> 0:09:47.920 where you see you know, riskond days and equities and 0:09:47.960 --> 0:09:51.080 the sell off in bonds. But I'm losing the neat 0:09:51.160 --> 0:09:53.640 narrative here. I gotta be honest. Yesterday I was really 0:09:53.640 --> 0:09:57.480 confused because we've got tenure yields shooting higher, seismic move 0:09:57.800 --> 0:10:00.560 you have break even rates, the expectation for longer term 0:10:00.600 --> 0:10:03.320 inflation not doing that much, so this isn't necessarily a 0:10:03.400 --> 0:10:05.880 surge in long term growth prospects. And all of a 0:10:05.920 --> 0:10:08.240 sudden you've got junk bonds yields at record lows, even 0:10:08.280 --> 0:10:10.600 though we've got an unemployment rate that still is a 0:10:10.640 --> 0:10:15.480 nero historic highs in the recent era. What's the narrative? So, 0:10:15.720 --> 0:10:18.320 you know, I would say, broadly speaking, real yields as 0:10:18.320 --> 0:10:20.600 well as break evens heading in the right direction. We 0:10:20.679 --> 0:10:23.600 hit a load of negative one percent in tennie real 0:10:23.720 --> 0:10:26.640 yields that's gone up to a closer negative ad basis points. 0:10:26.960 --> 0:10:29.600 And then in break evens as well, you saw about 0:10:29.679 --> 0:10:32.720 a six or seven basis point rise and break evens. 0:10:32.720 --> 0:10:34.760 So it's it's heading in the right direction. That's what 0:10:34.840 --> 0:10:37.840 you want to see in a reflation trade, higher real 0:10:37.920 --> 0:10:42.240 yields and wider break evens the question is one of caution. 0:10:42.320 --> 0:10:44.640 It's really hard for the bond market to price in 0:10:45.080 --> 0:10:47.360 a lot of exuberance in a very short period of time, 0:10:47.400 --> 0:10:49.320 given the fact that the FED is very much at 0:10:49.360 --> 0:10:52.840 play and there's really no certainty on a lot of fronts. 0:10:52.840 --> 0:10:54.920 I mean, there's not there's not good it's not clear 0:10:54.960 --> 0:10:56.920 that we're going to get any sort of fiscal stimulus 0:10:56.920 --> 0:10:58.319 by the end of the year. Even if we do, 0:10:58.720 --> 0:11:00.440 it's not going to be of the magie to that's 0:11:00.480 --> 0:11:04.880 required by the by the economy to prevent new term 0:11:04.960 --> 0:11:08.640 damage in the jobs market. Sespparentially mentioned the Federal Reserve, 0:11:08.760 --> 0:11:11.000 and for me, it's the recovery through twenty one that 0:11:11.040 --> 0:11:13.400 we all hope for, whether feds new reaction function will 0:11:13.400 --> 0:11:15.800 start to come into its own, where good news will 0:11:15.880 --> 0:11:17.480 just be good news because the FED is set we 0:11:17.520 --> 0:11:20.000 will not step in. How are you thinking about that 0:11:20.160 --> 0:11:23.160 after the news of the twenty four hours Well, I 0:11:23.160 --> 0:11:25.400 think the FED is doing exactly what they should be doing, 0:11:25.400 --> 0:11:27.679 which is the staining path. Right. There's not much they 0:11:27.679 --> 0:11:30.680 can do on the monetary policy side to stimulate the economy. 0:11:30.720 --> 0:11:33.800 What really need, what the economy really needs now is 0:11:33.840 --> 0:11:36.600 on the fiscal side if there is sort of an 0:11:36.640 --> 0:11:38.559 unruly sell off in bonds, and I can see the 0:11:39.000 --> 0:11:42.320 FED step in, But there's really no need for for 0:11:42.360 --> 0:11:45.920 any sort of monetary stimulus at the current time. Financial conditions, 0:11:45.960 --> 0:11:49.040 broadly speaking, are extraordinarily easy. You're looking at interestrates and 0:11:49.160 --> 0:11:52.160 historic blows, you know, equity markets and historic highs the 0:11:52.240 --> 0:11:55.200 dollars week. So there's really not much the Fed can 0:11:55.240 --> 0:11:58.040 do to move the needle. Really, the stimulus has to 0:11:58.080 --> 0:12:01.640 come on the fiscals time side to stop job losses. 0:12:02.800 --> 0:12:07.040 It's about a right to catch up. As Owise selk Jan, 0:12:10.600 --> 0:12:12.920 what we're trying to do John Fern, Liza bramoitts into 0:12:12.960 --> 0:12:14.920 all of you on radio and TV, is bring you 0:12:15.040 --> 0:12:18.480 more than the markets. We're looking at economics, finance, investment 0:12:18.840 --> 0:12:22.640 as horrific virus. As we speak to scientists, sometimes we 0:12:22.720 --> 0:12:26.560 speak to politicians. Kethy Hokel is a Lieutenant governor of 0:12:26.600 --> 0:12:30.040 the Empire State. She knows the trajectory of the Erie 0:12:30.120 --> 0:12:32.880 Canal as it opened up western New York and from 0:12:32.960 --> 0:12:37.800 Onondaga to Munroe to Erie County, it is a yellow zone. 0:12:38.160 --> 0:12:41.160 The Lieutenant governor joins us this morning, Cathy, what does 0:12:41.200 --> 0:12:43.320 the yellow zone, and what does it mean as you 0:12:43.360 --> 0:12:47.320 confront a new virus. Well, thank you for having me 0:12:47.360 --> 0:12:49.520 back on the show, and yes, I'm embedded in that 0:12:49.880 --> 0:12:53.360 yellow zone right now. Yellow means caution, and it says 0:12:53.400 --> 0:12:57.160 that if our numbers don't start trending downward, reversing where 0:12:57.160 --> 0:12:59.040 we've been for the last two weeks, we'll be in 0:12:59.040 --> 0:13:01.480 in a situation where we're heading to orange and red, 0:13:01.520 --> 0:13:04.400 and those means we will have shutdowns, and we'll be 0:13:04.559 --> 0:13:07.480 trying very hard not to get to a situation where 0:13:07.480 --> 0:13:10.559 we have to reverse the progress we've made on reopening. 0:13:10.760 --> 0:13:13.160 But our schools also have to do more testing. We've 0:13:13.200 --> 0:13:15.920 limited the number of people at gatherings. So it's not 0:13:16.040 --> 0:13:18.880 the worst case scenario, but it's a warning to our 0:13:18.920 --> 0:13:22.360 residence here that I've been saying for days. Now change 0:13:22.360 --> 0:13:25.080 your behavior or you'll be locked out of your favorite 0:13:25.080 --> 0:13:27.080 restaurant and you have no chance of going through a 0:13:27.080 --> 0:13:29.280 football game in person this year, and a lot of 0:13:29.280 --> 0:13:32.880 other consequences. So it's basically trying to stay beware and 0:13:33.000 --> 0:13:36.160 change your behavior starting today, Lieutenant Governor of the Conceit 0:13:36.360 --> 0:13:40.600 is the big cities have ample medicine, ample hospitalization. I 0:13:40.640 --> 0:13:44.000 think of strong and that complex and Rochester over in Buffalo, 0:13:44.440 --> 0:13:48.480 you've seen a positivity rate that is just exploded. Are 0:13:48.480 --> 0:13:53.520 you concerned with Governor Cuomo about the hospitalization facilities available? 0:13:54.840 --> 0:13:57.240 The good news is is that we are prepared for 0:13:57.400 --> 0:14:00.640 even more capacity, far more capacity in the early months 0:14:00.640 --> 0:14:03.160 of this pandemic, and the Governor made sure that we 0:14:03.200 --> 0:14:06.480 had ample supplies of PPE and all the hospitals, each 0:14:06.559 --> 0:14:08.360 one was required to have at least a three months 0:14:08.400 --> 0:14:11.880 additional supply. I've been in regular charge with their leadership 0:14:11.880 --> 0:14:14.559 of the hospitals. Yes, our numbers have gone up, but 0:14:14.600 --> 0:14:19.120 it's about maybe people in hospitals in Western York. We 0:14:19.160 --> 0:14:22.160 can handle that now. But you're absolutely right, it's something 0:14:22.160 --> 0:14:24.000 that if the numbers, you know, the number of people 0:14:24.040 --> 0:14:28.240 testing positive, if they turn into serious cases and hospitalizations required, 0:14:28.800 --> 0:14:31.480 we're going to have to get back to the eliminating 0:14:31.880 --> 0:14:35.720 the elective surgeries and a lot of the unessential procedures 0:14:35.720 --> 0:14:37.840 that are now going on, so we can create the 0:14:37.840 --> 0:14:41.240 capacity very quickly. Though. We are actually have unfortunately a 0:14:41.280 --> 0:14:43.320 lot of experience dealing with this and we'll be able 0:14:43.360 --> 0:14:45.800 to handle it in the meantime, Cathy, yesterday we got 0:14:45.840 --> 0:14:49.040 incredible news on the vaccine front from Fiser, A lot 0:14:49.040 --> 0:14:52.320 of people expecting a turn, perhaps an end to the 0:14:52.320 --> 0:14:55.000 pandemic next year, but there's a lot of daylight between 0:14:55.000 --> 0:14:57.320 now and then, and some people saying that will reduce 0:14:57.400 --> 0:15:01.120 the emphasis on a fiscal support plan from Washington, d C. 0:15:01.680 --> 0:15:04.960 From your vantage point, how much does this take pressure 0:15:05.000 --> 0:15:07.720 off of Washington to help with the twelve billion dollar 0:15:07.760 --> 0:15:09.840 bailout for the m t A, to help with the 0:15:09.920 --> 0:15:12.240 unemployment as more people get laid off as the virus 0:15:12.280 --> 0:15:16.840 counts go up, and just help financially going forward. I 0:15:16.880 --> 0:15:20.040 don't think they're related. I don't think that having a 0:15:20.160 --> 0:15:23.200 vaccine takes the pressure off at all, because we've already 0:15:23.240 --> 0:15:25.760 lost that money. We've already lost the revenues and the 0:15:25.840 --> 0:15:30.440 feeds generated from people using our transportation systems or from 0:15:30.480 --> 0:15:33.360 the sales tax revenues that were not collected, and the 0:15:33.440 --> 0:15:36.680 extraordinary cost that we had to incur just fighting this 0:15:36.760 --> 0:15:40.080 pandemic and are still paying for now. That's not gone 0:15:40.080 --> 0:15:43.120 away with the vaccine, And the truth is this vaccine 0:15:43.600 --> 0:15:46.200 is going to take a while to be wildly disseminated 0:15:46.200 --> 0:15:49.120 and have a real impact now. Governor Cuomo this summer 0:15:49.360 --> 0:15:52.080 started working on this, you know, very early on to 0:15:52.160 --> 0:15:55.480 have a widespread distribution plan in the state of New York, 0:15:55.520 --> 0:15:58.280 one that's quite different from what the White House is proposing, 0:15:58.600 --> 0:16:00.680 where they're saying they're going to get into the hands 0:16:00.720 --> 0:16:04.680 of doctors and to the pharmacies. Would is great if 0:16:04.720 --> 0:16:06.600 you live in an area that has a lot of 0:16:06.640 --> 0:16:10.000 doctors and pharmacies, but large parts of New York City, 0:16:10.120 --> 0:16:12.640 or what we call healthcare deserts, they don't have a 0:16:12.760 --> 0:16:16.000 right A or CVS or Walgreens. Where are they supposed 0:16:16.000 --> 0:16:18.280 to get it? So we're focused in New York. I'm 0:16:18.280 --> 0:16:21.600 making sure that communities that have been hardest hit that 0:16:21.720 --> 0:16:24.520 make sure that they're not left out of the distribution 0:16:24.600 --> 0:16:27.160 of the vaccine early on as well, because many of 0:16:27.160 --> 0:16:30.400 those individuals in the black and brown communities, they're the 0:16:30.440 --> 0:16:33.320 frontline workers, they're the health care workers, they're the mt 0:16:33.680 --> 0:16:36.040 mt A workers. So we want to make sure that 0:16:36.040 --> 0:16:39.720 there's the plan includes everyone and is fairly distributed as 0:16:39.800 --> 0:16:43.240 quickly as possible. Lieutenant Government. Just to finish on a 0:16:43.280 --> 0:16:46.800 final question about restrictions, We've seen restrictions from Massachusetts, we've 0:16:46.800 --> 0:16:48.960 seen it from Utah, and yesterday evening we saw it 0:16:49.240 --> 0:16:52.680 from the government New Jersey, Mr Murphy, Now Phil Murphy 0:16:52.720 --> 0:16:54.600 outlined a plan that we're all familiar with here in 0:16:54.640 --> 0:16:58.200 the UK, which is to close down indoor dining from 0:16:58.200 --> 0:17:01.200 ten pm. We're familiar with that. Because it didn't end there. 0:17:01.400 --> 0:17:05.080 Something else came next, Cathy, do you see merit in 0:17:05.119 --> 0:17:06.919 that approach? Lieutenant Governor? Do you think that is a 0:17:06.960 --> 0:17:10.680 good approach to allow indoor dining to shut at tempm? 0:17:10.680 --> 0:17:14.000 Does that make sense to you to stop at temp M. 0:17:14.040 --> 0:17:16.320 We actually have a restaurants have to shut down at 0:17:16.359 --> 0:17:18.840 midnight in New York City and that is part of 0:17:18.880 --> 0:17:21.119 our Yellow Zone in fact, and you know upstate New 0:17:21.160 --> 0:17:24.159 York those counties that you referenced earlier will now be 0:17:24.200 --> 0:17:27.639 having restaurants shut down at midnight because people tend to 0:17:27.840 --> 0:17:29.679 the more you drink, the more you're out, you know, 0:17:29.840 --> 0:17:33.200 more likely to gather at parties afterwards. You just analyze 0:17:33.280 --> 0:17:37.280 human behavior. Your defenses go down the more alcohol you've consumed, 0:17:37.520 --> 0:17:40.280 the left you are to be compliant about wearing the mask. 0:17:40.359 --> 0:17:43.240 So we think it makes sense. The issue that we 0:17:43.320 --> 0:17:46.440 have here, though, Lieutenant Governor, is it didn't stop there, 0:17:46.640 --> 0:17:50.520 and it clearly wasn't sufficient. You're not at all concerned 0:17:50.560 --> 0:17:53.600 that twelve doesn't make sense, tend doesn't make sense that 0:17:53.600 --> 0:17:55.320 actually you need to get ahead of what's about to 0:17:55.359 --> 0:17:59.720 happen through winter. Well you'res you're asking if it's going 0:17:59.760 --> 0:18:01.760 to be more a restrictive Well, the numbers will dictate 0:18:01.800 --> 0:18:03.760 that in the state of New York and New York 0:18:03.800 --> 0:18:07.800 City's infection rate was one eight percent on Friday, it 0:18:07.840 --> 0:18:11.040 has creeped up to about two point five percent. So clearly, yes, 0:18:11.080 --> 0:18:13.560 we are watching those numbers. And as we head into 0:18:13.640 --> 0:18:17.520 various zones, the one zone that does require a shutdown 0:18:17.520 --> 0:18:20.640 of restaurants is that is the red zone. What we're 0:18:20.640 --> 0:18:23.040 now doing is limiting the number of people at tables. 0:18:23.200 --> 0:18:25.200 You can't have ten people at the table, you can 0:18:25.200 --> 0:18:27.679 only at for so everything you're talking about, we are 0:18:27.720 --> 0:18:30.200 watching what going on in other states. But New York 0:18:30.240 --> 0:18:34.000 still maintains that we are the lowest large state infection ry. 0:18:34.040 --> 0:18:36.000 I think a couple of rural states are maybe a 0:18:36.000 --> 0:18:38.320 little bit lower than us, but we want to maintain that. 0:18:38.400 --> 0:18:40.280 And you're absolutely right that everything has to be on 0:18:40.320 --> 0:18:42.720 the table to consider if we get to that situation. 0:18:43.080 --> 0:18:45.440 At sending Governor, we appreciate your time and howefully will 0:18:45.440 --> 0:18:52.639 catch up against and Cathy. How cool that Mr Pharaoh 0:18:52.680 --> 0:18:56.960 identifies that spread between Russell two thousands small cap is 0:18:57.000 --> 0:19:00.000 indicated by the big tech is negative. Big tech negative 0:19:00.040 --> 0:19:04.280 of Russell two thousand is positive. Stampsovo has seen this before. 0:19:04.280 --> 0:19:06.919 He's a cfi A. Well, actually none of us have 0:19:07.000 --> 0:19:09.359 seen what we saw yesterday, and it will go and 0:19:09.400 --> 0:19:13.919 you acclaim stock almanac, Sam Stovo, just your single summary 0:19:13.960 --> 0:19:19.879 of how unusual was yesterday? Well, Tom, very unusual. I 0:19:19.960 --> 0:19:23.640 mean we were up uh more than five percent at 0:19:23.640 --> 0:19:26.000 one point on the day, and then we closed up 0:19:26.040 --> 0:19:29.480 one on the S and P five. So when you 0:19:29.560 --> 0:19:33.840 look to you know, closing percent changes, Um, it's just 0:19:34.160 --> 0:19:38.040 simply a blip. We had five times this year that 0:19:38.080 --> 0:19:42.359 we're even substantially stronger. On March we were up nine 0:19:42.359 --> 0:19:47.119 point in a single day. Um. And so I would 0:19:47.119 --> 0:19:51.040 say it would certainly add excitement to one's portfolio, but 0:19:51.160 --> 0:19:54.760 certainly not adding a lot in terms of asset value. 0:19:54.840 --> 0:19:58.119 Right now, Sam, yesterday was a catch up tride. We 0:19:58.119 --> 0:20:00.399 can all agree on that the names, the parts of 0:20:00.440 --> 0:20:02.639 the market that were left behind all caught up. What 0:20:02.800 --> 0:20:05.280 people thought it was safe suddenly became a massive risk 0:20:05.320 --> 0:20:09.080 you reprice Boom twenty four as done or is it? 0:20:09.200 --> 0:20:11.800 And Sam, that's the question right now. Was yesterday the 0:20:11.840 --> 0:20:14.400 catch up trade or the beginning of a durable trend? 0:20:14.480 --> 0:20:17.560 Now that's really difficult to identify with one day's price action. 0:20:17.640 --> 0:20:20.720 But Sam, do you have a cool on that? Well? 0:20:20.920 --> 0:20:22.720 I think that you know when you look to the 0:20:22.800 --> 0:20:26.600 individual day then you know you're absolutely correct. Um, you 0:20:26.800 --> 0:20:31.200 had basically seventy of the near one hundred and fifties 0:20:31.200 --> 0:20:35.359 sub industries in the SMP in positive territory, so it 0:20:35.440 --> 0:20:39.080 was pretty broadly diversified. The SMP six was up close 0:20:39.119 --> 0:20:42.760 to five in the single day. Mid caps are up 0:20:42.800 --> 0:20:45.760 three percent versus the large caps a little more than 0:20:45.840 --> 0:20:49.520 one percent. Game. I think that because investors are saying, 0:20:49.560 --> 0:20:52.879 we've got ten companies around the world that are in 0:20:52.960 --> 0:20:57.440 phase three trials of a COVID nineteen virus vaccine, that 0:20:57.680 --> 0:21:01.359 even if Fiser's stumbles a little bit, we still have 0:21:01.480 --> 0:21:04.480 nine more that we can work with. And so Wall 0:21:04.520 --> 0:21:08.080 Street is looking beyond the valley, it's looking beyond the 0:21:08.119 --> 0:21:11.359 spike right now and saying six to twelve months from now, 0:21:12.080 --> 0:21:15.240 things will be growing. And the real question is by 0:21:15.280 --> 0:21:18.760 how much will analysts be elevating their two thousand and 0:21:18.760 --> 0:21:21.639 twenty one estimates, and we all have to look beyond 0:21:21.760 --> 0:21:24.800 this valley just to stay upright, frankly, because the pandemic 0:21:24.840 --> 0:21:26.960 hasn't been that fun. That said, you still have to 0:21:26.960 --> 0:21:29.800 start wondering about valuations. Yes, we are going to reach 0:21:29.840 --> 0:21:32.800 some sort of new normal, but record highs basically in 0:21:32.880 --> 0:21:35.600