WEBVTT - Consumer Outlook, Muni Bonds, And Virtual Conferences 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.560 --> 0:00:15.560 with essential market moving news. Find the Bloomberg Markets podcast 0:00:15.560 --> 0:00:18.479 called Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:22.160 at Bloomberg dot com slash podcast. Now, let's bring in 0:00:22.239 --> 0:00:25.640 Every Sheffield, Managing Director and senior portfolio manager of long 0:00:25.640 --> 0:00:31.200 short equity hedge fund Strategy at Rockefeller Asset Management. Avery's 0:00:31.240 --> 0:00:33.720 great to have you back on the program again. I 0:00:33.800 --> 0:00:35.680 just want to hit you first with the PPI data. 0:00:35.680 --> 0:00:38.479 I'm sure you've seen, but a huge jump UM in 0:00:38.560 --> 0:00:41.959 final demand year of Europe nine point six percent. Does 0:00:42.000 --> 0:00:45.120 inflation concern you or do you think the Fed's gotta 0:00:45.120 --> 0:00:49.520 handle on it? Yes? So I don't know. I mean 0:00:50.120 --> 0:00:54.200 everything I say suggests that there's and we're nowhere near 0:00:54.360 --> 0:00:58.240 the end of inflation UM, both from the PPI prices 0:00:58.320 --> 0:01:01.400 and from the ability of any companies to pass on 0:01:01.480 --> 0:01:06.080 inflation UM. It's really been significantly improved through UM through 0:01:06.120 --> 0:01:10.000 their own analytical tools UM and and and and buying discipline. 0:01:10.120 --> 0:01:12.679 So yes, that the pp. I think it's just one 0:01:12.720 --> 0:01:16.119 more indicator that inflation is likely to be around longer 0:01:16.160 --> 0:01:19.320 than anticipated. And you know, I almost I feel like, 0:01:19.400 --> 0:01:21.600 no matter what the sent does, we're likely to see 0:01:21.640 --> 0:01:25.600 this as a as a new norm. So if maybe 0:01:25.600 --> 0:01:28.560 a little bit of a new norm here, UM, higher inflation, 0:01:28.600 --> 0:01:30.480 maybe not obviously where we are here at six seven, 0:01:30.920 --> 0:01:33.400 but certainly higher than where we were two for such 0:01:33.400 --> 0:01:36.880 a long period of time. How's the consumer faring with that? 0:01:36.959 --> 0:01:39.039 It seems like some of the retail numbers that we've 0:01:39.080 --> 0:01:41.160 seen out of the retailers in the earnings third quarter, 0:01:41.640 --> 0:01:44.479 we're pretty darn solid. There's some pretty good guidance for 0:01:44.560 --> 0:01:47.080 the holidays. What's your take of the consumer and the 0:01:47.120 --> 0:01:52.880 consumer space? Yes, so, UM, retailers have really been succeeding 0:01:52.920 --> 0:01:56.520 for the most part in passing on this inflation UM. 0:01:56.760 --> 0:01:58.800 And so I mean that's one of the reasons that 0:01:58.920 --> 0:02:02.520 that I feel positive, uh, you know, constructive about UM. 0:02:02.560 --> 0:02:05.360 The fact inflation is going to continue. UM. You know, 0:02:05.400 --> 0:02:08.880 you're certainly seeing some pressure in the lower income consumer 0:02:09.200 --> 0:02:13.079 and next year as they you know, last stimulus benefits. UM. 0:02:13.280 --> 0:02:14.959 You know, I think people are gonna be very selective 0:02:15.000 --> 0:02:18.240 about about where they're spending. But from a from a 0:02:18.440 --> 0:02:20.880 from a kind of a company, from a stock perspective, 0:02:21.160 --> 0:02:24.560 those companies that have been able to pass on higher pricing, 0:02:24.880 --> 0:02:28.160 I think are our places to look for investments next 0:02:28.280 --> 0:02:31.079 year UM, because those companies that have been able to 0:02:31.080 --> 0:02:35.160 pass on higher pricing are those more likely to next year. UM. 0:02:35.200 --> 0:02:38.000 It means that consumers like their products, there's real demand 0:02:38.040 --> 0:02:42.079 for them. UM. They have underappreciated some underappreciated pricing power. 0:02:42.919 --> 0:02:44.760 How do you think about oh, Macron, Paul and I've 0:02:44.800 --> 0:02:47.400 been talking about the fact that what you see happen 0:02:47.760 --> 0:02:51.120 in Europe, UM, the US typically follows, and we're hitting 0:02:51.120 --> 0:02:53.000 a big wave or a big wave is hitting us 0:02:53.000 --> 0:02:55.600 here in Europe. Now does that happen to the US later? 0:02:57.720 --> 0:03:01.240 I actually don't see it because as we see so 0:03:01.320 --> 0:03:04.600 much data coming in that that this variant is very mild, 0:03:04.760 --> 0:03:07.720 and so I think if that continues, UM, you know, 0:03:07.800 --> 0:03:11.560 Europe is going to be kind of a a place 0:03:11.600 --> 0:03:14.200 to see this play out first before the US has 0:03:14.240 --> 0:03:17.160 to act. I mean, certainly, if if if only com 0:03:17.720 --> 0:03:20.440 becomes you know, much more of an issue in terms 0:03:20.480 --> 0:03:24.280 of UM hospitalizations in death, you might see some actions here. 0:03:24.560 --> 0:03:26.680 But if we continue to see it quite benign. I 0:03:26.720 --> 0:03:29.280 was just reading something this morning about about some places 0:03:29.480 --> 0:03:32.120 starting to reverse UM, even some of the travel band. 0:03:32.960 --> 0:03:34.679 I think, you know, the U S could get through 0:03:34.720 --> 0:03:38.240 this with with fewer freedoms like we're seeing. Definitely math 0:03:38.360 --> 0:03:42.040 mandates UM, but not necessarily much of an economic impact 0:03:42.800 --> 0:03:45.880 every what's the uh, the status of the supply chain 0:03:45.920 --> 0:03:47.320 issues as you take a look at some of the 0:03:47.320 --> 0:03:49.840 consumer companies out there. I mean, I'm looking at a 0:03:49.840 --> 0:03:52.480 function here on a Bloomberg terminal, UH that lets me 0:03:52.680 --> 0:03:54.600 it's a mapping function. Lets me see a bunch of 0:03:54.640 --> 0:03:58.400 ships still docked off the ports of Los Angeles, still 0:03:58.480 --> 0:04:01.000 docked off the ports of Savannah and New York and 0:04:01.040 --> 0:04:04.800 so on. Is this something that we can expect to 0:04:04.880 --> 0:04:07.280 resolve over some period of time or is this again 0:04:07.720 --> 0:04:11.120 a little bit of a new normal here. Yes. And 0:04:11.200 --> 0:04:16.160 the companies we're speaking with UM, they don't anticipate this resolving, 0:04:16.480 --> 0:04:19.000 most of them until at least the second half of 0:04:19.120 --> 0:04:23.360 next year UM. So they're planning for it. So they're 0:04:23.400 --> 0:04:27.280 they're ordering earlier, UM, They're they're they're being much more 0:04:27.360 --> 0:04:31.400 thoughtful about where they're sourcing from UM, and they're pricing 0:04:31.520 --> 0:04:35.200 for it, So I think that this is likely to continue. 0:04:35.480 --> 0:04:37.800 UM at some point, right, it should fully resolve. I mean, 0:04:37.800 --> 0:04:40.200 just from a containership perspective, there are a lot of 0:04:40.200 --> 0:04:43.920 new orders on hand going out a couple of years 0:04:43.920 --> 0:04:45.640 from now, so at some point there should be a 0:04:45.640 --> 0:04:48.880 lot more simple highest containers UM. But of course it 0:04:48.920 --> 0:04:50.560 has to do the logistics at the ports and and 0:04:50.640 --> 0:04:53.120 COVID is related to that. UM. You'd expect COVID to 0:04:53.320 --> 0:04:56.279 you know, to to resolve UM at some point in 0:04:56.279 --> 0:04:58.479 in in the next you know, six to twelve months. 0:04:58.480 --> 0:05:00.520 So I think we should start to see the baby. 0:05:00.600 --> 0:05:02.839 Some companies have actually just UM in the past couple 0:05:02.839 --> 0:05:05.040 of weeks commented that they're seeing things loosen up a 0:05:05.080 --> 0:05:07.840 little bit for them. But it's an overall dynamic. UM. 0:05:08.320 --> 0:05:11.080 Everyone's planning for it and uh, and it looks like it, 0:05:11.200 --> 0:05:13.000 you know, it might not result for another six or 0:05:13.000 --> 0:05:17.600 twelve months. How do you benchmark alongshore equity hedge fund strategy? 0:05:17.640 --> 0:05:21.080 I mean, can you underperform big gains and at least 0:05:21.080 --> 0:05:25.240 as long as you outperform years where their losses look. 0:05:25.520 --> 0:05:28.320 I mean, I think as an as an investor in 0:05:28.400 --> 0:05:31.520 any entency is a fund of the stock UM, I 0:05:31.520 --> 0:05:35.320 wouldn't be investing in funds that UM that that aren't 0:05:35.360 --> 0:05:38.800 generating you know, real real returns. I know long short 0:05:38.839 --> 0:05:41.960 equity as a category is really underperformed. But in that 0:05:42.080 --> 0:05:46.160 category there are many funds UM that have actually done 0:05:46.360 --> 0:05:49.960 very well and have preserved capital um during times by 0:05:50.000 --> 0:05:52.680 the COVID crisis, and actually done quite well in markets 0:05:52.720 --> 0:05:55.320 like we've had, and really protect for the next downturn. 0:05:55.360 --> 0:05:57.520 I mean, you know, from an individual, the market as 0:05:57.520 --> 0:06:01.520 a whole is gonna marched higher. You're seeing tremendous bifurcation 0:06:01.920 --> 0:06:05.359 underneath the surface, and a lot of companies UM stocks 0:06:05.440 --> 0:06:08.560 down meaningfully in this in this uh, you know, even 0:06:08.560 --> 0:06:10.960 in the past six months. And should you see something 0:06:10.960 --> 0:06:13.680 spell whether's you know, start to turn a bit um, 0:06:13.680 --> 0:06:16.880 the induscries themselves might might struggle. So look, I don't 0:06:16.920 --> 0:06:19.280 know what's going to happen here. But the benefit of 0:06:19.400 --> 0:06:21.800 you know, of a long short strategy that considers all 0:06:21.800 --> 0:06:24.080 these things and has has proven to do well through 0:06:24.240 --> 0:06:27.960 the past um uh is that you know, even if 0:06:28.360 --> 0:06:30.600 it turned south, you can do well. But you know, 0:06:30.839 --> 0:06:34.640 I would look at every individual strategy m independently. All right, 0:06:35.240 --> 0:06:37.680 every thanks so much for joining us every Sheffield, there's 0:06:37.680 --> 0:06:44.720 an m D at Rockefeller Asset Management. Let's bring in 0:06:44.760 --> 0:06:48.040 Shaan Karney. Now he is the head of MUNI strategy 0:06:48.320 --> 0:06:53.520 over at black Rock, and that means Paul is very excited. Sean, 0:06:54.400 --> 0:06:57.480 talk to me about how much does it matter if 0:06:57.480 --> 0:07:01.160 we get this build back better bill past two munis? 0:07:01.560 --> 0:07:04.840 Is it less important, um than than the infrastructure bill? 0:07:05.000 --> 0:07:09.560 Was It matters, um? But but I would say it's 0:07:09.600 --> 0:07:14.240 not as important, um. You know. Some of the keys 0:07:14.320 --> 0:07:19.080 that the MUNI market has looked at is investors are 0:07:19.120 --> 0:07:22.920 anticipating higher taxes as a result of the build back 0:07:23.040 --> 0:07:25.960 that are plan. If we just look at a simple 0:07:26.000 --> 0:07:29.160 calculation of a market implied tax benefit, it shows, you know, 0:07:29.200 --> 0:07:32.360 the market pricing for a fifty top marginal tax rate, 0:07:32.400 --> 0:07:35.440 which as you know, is significantly higher than this administration 0:07:36.360 --> 0:07:39.360 has been has been talking. But I think that the 0:07:39.360 --> 0:07:42.800 bigger impact comes from the supply side of the equation, 0:07:43.240 --> 0:07:46.320 where things like Advanced were Funding bonds and Build America 0:07:46.360 --> 0:07:49.840 bonds were omitted from the from the final draft, which 0:07:49.920 --> 0:07:52.680 ultimately would have been a catalyst for for greater supply 0:07:52.760 --> 0:07:55.800 in the market. So it does matter, h and markets 0:07:55.800 --> 0:07:59.960 are paying attention. So Sean in THEMMUNI market um again 0:08:00.000 --> 0:08:01.680 and I'm a big fan of the mini market, and 0:08:01.720 --> 0:08:04.680 the UNI bond returns have been very strong compared with 0:08:04.720 --> 0:08:07.760 other fixed income markets this year. What's behind that and 0:08:08.120 --> 0:08:12.600 what's the outlook for That's a good question. So they 0:08:12.600 --> 0:08:15.040 have been and a lot of people concentrate on the 0:08:15.080 --> 0:08:17.640 gross returns. I think it's also important to look at 0:08:17.640 --> 0:08:21.120 excess returns. So you're to date, the investment grade UNI 0:08:21.200 --> 0:08:23.880 market is up about one and a half percent, but 0:08:24.040 --> 0:08:27.880 in excess returns i e. When we duration match communities 0:08:27.880 --> 0:08:31.720 to treasuries, unis are up three basis points, and excess 0:08:31.720 --> 0:08:34.040 returns when you compare that to a U S AGG 0:08:34.160 --> 0:08:36.520 or corporate i G. That's down about one and a 0:08:36.559 --> 0:08:39.360 half percent. I think there are several factors that have 0:08:39.400 --> 0:08:43.600 been driving this year's positive performance, and while I want 0:08:43.640 --> 0:08:45.680 to say it can continue into twenty two, there's a 0:08:45.679 --> 0:08:47.440 couple of things I think we need to pay attention to. 0:08:47.880 --> 0:08:51.120 Like I mentioned, higher taxes on the individual side would help. 0:08:51.520 --> 0:08:54.040 On the corporate side, it's still unclear the role that 0:08:54.120 --> 0:08:57.520 banks and insurance companies will play. From the demand side. 0:08:58.440 --> 0:09:02.839 This year's outperformance has relative value measures I e. MUNI 0:09:02.920 --> 0:09:06.640 treasury ratios screening a bit rich so sub fifty in 0:09:06.679 --> 0:09:09.079 the first five years of the curve and probably ten 0:09:09.160 --> 0:09:12.040 ratio is rich out longer on the curve. So as 0:09:12.080 --> 0:09:16.040 long as supplied demand dynamics remains skewed, positive munies will 0:09:16.040 --> 0:09:19.320 hold in well. However, if that ratio goes a little sideways, 0:09:19.360 --> 0:09:21.199 we could see munities come under a bit of pressure. 0:09:21.400 --> 0:09:23.640 I think about the net positive months of March and 0:09:23.679 --> 0:09:26.760 April and September and October, which have a little bit 0:09:26.840 --> 0:09:30.240 less uh, you know, technical strength than others. And I'd 0:09:30.240 --> 0:09:32.240 say the other thing to pay attention to is MUNI 0:09:32.559 --> 0:09:37.960 fundamentals support continued strong performance, as does the notion interest 0:09:38.080 --> 0:09:42.360 rates will rise in as munies tend to outperform in 0:09:42.400 --> 0:09:47.719 a rising rate environment given their structure. Where are there places, 0:09:47.880 --> 0:09:51.480 um that are most advantageous to buy MUNI is still 0:09:51.520 --> 0:09:57.080 if you're looking for a tax avoidance, there are you know, 0:09:57.200 --> 0:10:00.840 our the way that we've kind of been positioning portfolios, 0:10:00.880 --> 0:10:03.320 and you know, positioning going into twenty two, I'd say 0:10:03.320 --> 0:10:07.400 we're going into the year slightly long duration stand but 0:10:07.520 --> 0:10:11.840 importantly maintaining a barbell yield curve strategy. So we prefer 0:10:11.920 --> 0:10:15.080 lower rated investment grade bonds for instance, particularly in the 0:10:15.120 --> 0:10:17.520 front end of the yield curve, as well as select 0:10:17.600 --> 0:10:21.320 high yield credits. And we maintain a favorable view on 0:10:21.520 --> 0:10:26.880 tax backed transportation, healthcare, and the education sectors. And the 0:10:26.960 --> 0:10:31.440 economic recovery is positioned to continue with strong growth in 0:10:31.480 --> 0:10:34.080 the tighter labor market in the coming year, you know, 0:10:34.160 --> 0:10:37.000 hence our our preference for for those you know, parts 0:10:37.080 --> 0:10:39.440 of the market on the yield curve and across the 0:10:39.440 --> 0:10:43.320 credit spectrum. Sean, give us a sense just kind of 0:10:43.320 --> 0:10:46.080 how fun flows have been into the MUNI space here. 0:10:46.120 --> 0:10:49.520 I wouldn't guessing listen, talk about higher taxation out there, 0:10:50.000 --> 0:10:53.760 people are more inngest in the muni's flows have been phenomenal. 0:10:53.840 --> 0:10:56.079 Year to day, we've seen about eighty three billion come 0:10:56.120 --> 0:10:59.040 into the market. We have three prints left, but we're 0:10:59.040 --> 0:11:01.000 probably going to come in a shy of the record 0:11:01.000 --> 0:11:03.839 of the year of two thousand nineteen that printed about 0:11:03.920 --> 0:11:07.679 ninety four billion UM. It's been sensational. There's many different 0:11:07.679 --> 0:11:09.120 ways that we can look at it. And we can 0:11:09.240 --> 0:11:13.080 use MUB the largest MUNI e t f UH ticker 0:11:13.240 --> 0:11:16.160 as as a way of looking at UM whether trades 0:11:16.200 --> 0:11:18.319 that a discount or premium do as n a V. 0:11:18.559 --> 0:11:20.920 That's ultimately kind of what fast Money will tell you 0:11:20.960 --> 0:11:24.360 about the future flows, and it's been very positive. It 0:11:24.400 --> 0:11:27.600 remains very positive. We've been seeing you know, good inflows 0:11:27.679 --> 0:11:30.400 from from all different types of accounts, so you know, 0:11:30.520 --> 0:11:33.439 one would believe that as performance continues, you know, we'll 0:11:33.440 --> 0:11:35.920 see fund flows continue as well as we flip the 0:11:35.960 --> 0:11:39.199 calendar into into two. All Right, Seohn, thanks so much 0:11:39.200 --> 0:11:41.800 for your time. We really appreciate you sharing your thoughts 0:11:41.800 --> 0:11:45.040 here on the bond marker. Shaun Carney, head of Municipal 0:11:45.080 --> 0:11:51.880 Strategy at black Rock. I want to bring Shawn McCarthy. 0:11:51.920 --> 0:11:55.320 He's a CEO and co founder of Build America Mutual 0:11:55.360 --> 0:11:58.679 talk about the municipal bond marketing we heard earlier today. 0:11:58.720 --> 0:12:01.880 We're chatting Shawn and how the good performance coming out 0:12:01.880 --> 0:12:04.120 of the municipal bond market. I want to start with 0:12:04.679 --> 0:12:07.800 who's buying these things? Give us a sense of who 0:12:07.800 --> 0:12:11.400 are the buyers in municipal bond market, retail versus institutional. 0:12:11.920 --> 0:12:16.280 What's a typical buyer like out there? Well, thanks Upo 0:12:16.440 --> 0:12:19.559 met for having me join you today. UM, and so 0:12:19.679 --> 0:12:24.640 the typical UH investor in the municipal bonds would be 0:12:24.760 --> 0:12:27.760 somebody who plays that has in the high income tax bracket. 0:12:28.040 --> 0:12:29.920 Do you think about the fact that the vast majority 0:12:29.920 --> 0:12:35.480 of municipal bonds are tax exempt, that benefit really runs 0:12:35.520 --> 0:12:38.720 to the individual who is purchasing those bonds, And so 0:12:39.160 --> 0:12:42.959 you really think about municipal bonds generally as retail or 0:12:43.679 --> 0:12:48.120 um investments in proxies of retail meaning funds institutional funds 0:12:48.120 --> 0:12:51.960 that you can buy. So, um, do you have an 0:12:51.960 --> 0:12:55.080 eye on the best places to invest right now? I 0:12:55.080 --> 0:12:58.120 mean where if I want to avoid taxes and also 0:12:58.240 --> 0:13:00.559 generate some returns, where do I go in this kind 0:13:00.559 --> 0:13:04.319 of market? Well, so in the municipal bond market, I'd 0:13:04.360 --> 0:13:06.360 say there's a couple of things that are happening. This 0:13:06.440 --> 0:13:09.600 year will end up being about a four hundred and 0:13:09.640 --> 0:13:12.880 sixty billion dollar market, perhaps a little bit more than that, 0:13:13.080 --> 0:13:15.640 which is which is a record. We would anticipate that 0:13:15.720 --> 0:13:18.400 next year would be the same. Now, when you look 0:13:18.440 --> 0:13:20.840 at what those opportunities are going to be, UM, I 0:13:20.840 --> 0:13:24.360 think they're going to center around, uh, some of the 0:13:24.400 --> 0:13:27.199 things that have happened in Washington. So when the infrastructure 0:13:27.240 --> 0:13:30.160 bill was passed, that's good and that it sort of 0:13:30.880 --> 0:13:35.040 provides a resource for state and local governments to um 0:13:35.320 --> 0:13:38.439 uh you know, finance and repair infrastructure that that they 0:13:38.440 --> 0:13:41.559 have going forward. UM. One of the things that's interesting 0:13:41.559 --> 0:13:46.440 about that that's Federal Infrastructure Bill is that really still 0:13:46.480 --> 0:13:50.480 at the at the fundamental funding level for infrastructure. It's 0:13:50.559 --> 0:13:52.719 done at the state and local government level. So that's 0:13:52.720 --> 0:13:57.840 about of bonds that are issued for infrastructure are done 0:13:57.840 --> 0:14:00.720 at state and local governments. So what we see happening 0:14:00.720 --> 0:14:02.360 next year, it's going to be a fact that there'll 0:14:02.400 --> 0:14:05.920 be funds that will be matched by the federal government 0:14:06.480 --> 0:14:11.000 UH for statan local governments as they build out um 0:14:11.160 --> 0:14:14.400 their infrastructure and repair the infrastructure that you know, this 0:14:14.760 --> 0:14:16.840 is long overdue. So this we think is a pretty 0:14:16.840 --> 0:14:19.720 exciting area. And I think that if investors are looking 0:14:19.760 --> 0:14:22.600 to participate in that market, and that's going to be 0:14:22.880 --> 0:14:24.680 there's gonna be a lot of opportunity next year to 0:14:24.680 --> 0:14:27.880 do that. UM. Sean, I want to ask you about 0:14:28.080 --> 0:14:31.280 just the whole E s G Green bond phenomena. We 0:14:31.280 --> 0:14:34.800 see corporations looking for the designation of a of their 0:14:34.840 --> 0:14:37.840 one of their issuance being a green bond or E 0:14:37.960 --> 0:14:40.040 s G friendly bond. Is that a is that a 0:14:40.160 --> 0:14:43.680 thing in the municipal bondmark as well. You know, it's 0:14:44.040 --> 0:14:47.520 it's actually a growing thing. So we've at the Build 0:14:47.520 --> 0:14:52.280 American Mutual UM, we've been designating green star bonds or 0:14:52.600 --> 0:14:57.280 green bonds UM as part of our underwriting process UM, 0:14:57.440 --> 0:15:00.160 you know, for four or five years now. And so 0:15:00.280 --> 0:15:03.560 if you think about that market, this past year through 0:15:03.600 --> 0:15:07.200 the third quarter, over twelve billion dollars of municipal green 0:15:07.240 --> 0:15:11.280 bonds were issued in the United States UM. UH. Part 0:15:11.280 --> 0:15:14.000 of what we do is as a service is to 0:15:14.040 --> 0:15:17.720 make that designation. So we've actually designated one and a 0:15:17.760 --> 0:15:20.800 half billion dollars with the transactions through the third quarter 0:15:21.440 --> 0:15:26.840 UM as green. And that's UH an important factor because 0:15:26.840 --> 0:15:29.960 I think there is an investor demand for not only 0:15:30.000 --> 0:15:33.640 making smart investments, but doing well doing good for the 0:15:33.680 --> 0:15:36.600 community at the same time. So green bonds really sort 0:15:36.600 --> 0:15:39.800 of if you think about it, they're there. The nature 0:15:39.800 --> 0:15:43.920 of them is sort of to finance clean water, renewable energy, 0:15:44.320 --> 0:15:49.560 energy efficiency. And in Europe it's it's something that has 0:15:49.640 --> 0:15:53.320 been really a part of their market for quite a while, 0:15:53.360 --> 0:15:56.760 but it's it's definitely a growing area in terms of 0:15:56.960 --> 0:16:00.360 UM the US municipal market. Talk to the about what 0:16:00.400 --> 0:16:02.120 you do at BAM. I mean you have a long 0:16:02.240 --> 0:16:06.600 history on Wall Street at uh EF Hutton and Paining Weber. 0:16:06.880 --> 0:16:12.200 Um you were chief operating officer to shared Guarantee until 0:16:12.240 --> 0:16:15.760 you started BAM. In what what's the main crux of 0:16:15.800 --> 0:16:19.640 your business? So um, UH build a back and mutual. 0:16:19.760 --> 0:16:24.080 BAM is a double A rated UH financial guarantee company. Basically, 0:16:24.120 --> 0:16:27.640 what we do is we put our guarantee arm initial bonds. 0:16:28.040 --> 0:16:30.200 That makes them double A in their own right. It's 0:16:30.200 --> 0:16:33.240 a little like you co signing a student loan for 0:16:33.320 --> 0:16:35.560 your children. UH. You hope they get a job and 0:16:35.600 --> 0:16:38.280 you hope they tell, but UM, if they don't, where 0:16:38.320 --> 0:16:40.600 they are standing by to make timely payment of principle 0:16:40.640 --> 0:16:43.000 and interest when due. So why do people use us? 0:16:43.680 --> 0:16:48.600 Issuers use us because we are UH going to lower 0:16:48.720 --> 0:16:51.480 their cost of funding and that that's pure and simple. 0:16:51.480 --> 0:16:54.120 So we're double A. We put our guarantee on that. 0:16:54.160 --> 0:16:57.320 It creates creator liquidity in the paper we provide on 0:16:57.360 --> 0:17:00.000 our website for free credit profiles, which is a summer 0:17:00.240 --> 0:17:03.880 every transaction that we underwrite, we looked at that every year, UH, 0:17:03.880 --> 0:17:08.520 and that creates value protection for the investor. It also 0:17:08.560 --> 0:17:12.720 creates you know, sort of unparalleled transparency and sort of 0:17:12.880 --> 0:17:16.040 unique to BAM um UH in the industry is that 0:17:16.119 --> 0:17:19.560 we are a mutual insurance company, which means that our 0:17:19.640 --> 0:17:23.560 stakeholders are the state local governments that take our insurance. 0:17:23.960 --> 0:17:27.200 And that's important because what they want, what we want 0:17:27.280 --> 0:17:30.200 is to be bigger and stronger and provide that guarantee 0:17:30.600 --> 0:17:34.119 to the market in order to create greater liquidity, greater 0:17:34.240 --> 0:17:40.160 security um UM investment portfolios that retail and institutional investors owned. 0:17:41.280 --> 0:17:43.919 All right, Seohan, We're also doing an informal poll on 0:17:44.760 --> 0:17:47.840 your favorite college bar in the Washington, D C. Area. 0:17:47.880 --> 0:17:51.000 You're Georgetown grad. Where did you go? Well, you know, 0:17:51.119 --> 0:17:56.160 when when I was at Georgetown, UM the third Edition 0:17:56.280 --> 0:18:00.080 was a very popular place, um uh and uh and 0:18:00.119 --> 0:18:03.520 I went to actually bartended a place called the Foundary UM. 0:18:03.600 --> 0:18:06.400 So I'm not objective. I thought the founder was pretty 0:18:06.440 --> 0:18:09.359 terrific as well, very cool. All right, Hey, Sean, great 0:18:09.359 --> 0:18:11.440 having on the program. Thanks so much for joining us. 0:18:11.760 --> 0:18:15.919 Sean McCarthy, co founder and the CEO of Build America Mutual. 0:18:20.800 --> 0:18:23.920 Speaking just from myself, I tend to get a lot 0:18:23.960 --> 0:18:27.040 of value out of attending conferences, and my career spent 0:18:27.119 --> 0:18:29.240 mostly to investor conferences. I found it a good way 0:18:29.240 --> 0:18:32.080 to you know, meet with clients, talk to other folks, 0:18:32.119 --> 0:18:35.160 get some new ideas, see new companies, that kind of thing. 0:18:35.280 --> 0:18:38.040 I even enjoyed the Consumer Electronics Show in Vegas, which 0:18:38.080 --> 0:18:41.160 is a couple hundred thousand tech geeks kind of getting 0:18:41.200 --> 0:18:44.000 together every January. But of course the pandemics put the 0:18:44.040 --> 0:18:46.600 kai bosh on the whole conference biz and we're doing 0:18:46.600 --> 0:18:49.760 everything virtually. So let's see how this might develop going forward. 0:18:49.800 --> 0:18:55.480 Ben Choulder, president of Notified, joins us UH. Notified provide 0:18:55.520 --> 0:18:59.800 software for virtual events. Uh so Ben talked to us 0:18:59.800 --> 0:19:03.520 about what your business has experienced during this pandemic. I 0:19:03.560 --> 0:19:05.679 gotta think there's a lot of demand for what you 0:19:05.720 --> 0:19:10.280 guys do at Notified. Oh my, so, first, thank you 0:19:10.320 --> 0:19:13.679 for having me on the show. I'm a big fan. Um. 0:19:13.840 --> 0:19:20.200 But it is totally change or largest vertical and streaming 0:19:20.280 --> 0:19:25.920 organizations actually moved right. So now it went from something 0:19:25.960 --> 0:19:28.680 that was a great way to reach a global audience 0:19:28.760 --> 0:19:31.560 or an extended audience to something that you had to 0:19:31.640 --> 0:19:34.800 do in twenty so. You know, everyone used to say 0:19:34.800 --> 0:19:38.800 that virtual events would eventually cannibalize physical events. It's not 0:19:39.000 --> 0:19:42.879 virtual it's not virtual events that cannibalize physical events. The 0:19:42.920 --> 0:19:46.600 world cannibalize physical events. So everyone in twenty had a 0:19:46.600 --> 0:19:50.439 hop on board, and everyone in continued and now the 0:19:50.520 --> 0:19:54.320 trend is heading towards you know, hybrid, right, it's time 0:19:54.359 --> 0:19:58.320 to do both. Have bases in places and that's that 0:19:58.359 --> 0:20:01.280 seems pretty clear. Ben. What you do it notified to 0:20:01.320 --> 0:20:06.159 healthy industry. So we as an organization provide the platform 0:20:06.280 --> 0:20:09.960 where the event tech platform, whether you're doing a physical 0:20:10.000 --> 0:20:13.000 event and you wanted to manage the event, whether you're 0:20:13.040 --> 0:20:16.199 doing a virtual event and wanted to have you know, 0:20:16.560 --> 0:20:22.200 tens of thousands of people attend sessions and breakouts and exhibits, 0:20:23.000 --> 0:20:25.920 or even if you're doing a hybrid, right, we were 0:20:25.960 --> 0:20:28.800 doing hybrid pre COVID. It allows you to actually have 0:20:28.960 --> 0:20:32.239 that physical audience and the virtual And you brought up 0:20:32.280 --> 0:20:36.239 cs like c S last year when virtual and had 0:20:36.400 --> 0:20:40.200 eighty thousand people attend. This year, they've decided or going 0:20:40.240 --> 0:20:42.480 into twenty two, they decided to do it as a hybrid. 0:20:42.800 --> 0:20:44.520 And if you read the news, you know they've had 0:20:44.520 --> 0:20:48.199 a fifteen thousand people register in the last two weeks. 0:20:48.440 --> 0:20:51.600 People are dying to attend, but they also know that 0:20:51.640 --> 0:20:55.440 there will be such a demand for the virtual element 0:20:55.520 --> 0:20:58.040 as well, So they're actually doing a true hybrid for 0:20:58.080 --> 0:21:01.600 the first time. Alright, so cee s hybrid. We know 0:21:01.680 --> 0:21:04.880 that as of this moment, Davos is going to be 0:21:05.560 --> 0:21:09.199 live in Switzerland. That's another big one for global business folks. 0:21:09.720 --> 0:21:12.000 How about some of the other conferences, whether it's just 0:21:12.080 --> 0:21:15.119 you know, a company wants to get their salesforce together, 0:21:15.560 --> 0:21:17.960 you know in some warm locale in Florida or the desert, 0:21:18.119 --> 0:21:21.560 or you know, an investment bank wants to have its 0:21:21.560 --> 0:21:24.000 a conference with its investors. What are you hearing on 0:21:24.040 --> 0:21:28.040 that front for We're hearing that it's going to be 0:21:28.280 --> 0:21:31.160 a hybrid if they're gonna do both. They want to 0:21:31.240 --> 0:21:34.920 have the interaction of being at the event, but they 0:21:35.000 --> 0:21:40.080 also understand that organizations aren't going to be feel very comfortable, 0:21:40.080 --> 0:21:42.880 and not all organizations can feel comfortable in the beginning 0:21:42.960 --> 0:21:47.120 of twenty two sending everyone to a location plus individuals 0:21:47.160 --> 0:21:49.520 aren't gonna feel comfortable. So they want to give them 0:21:49.520 --> 0:21:52.359 a choice. So you got to allow the audience to 0:21:52.400 --> 0:21:55.760 participate in multiple ways. I mean, there's great advantages of 0:21:55.800 --> 0:21:58.760 it too. Rite It's it's cost effective, it's better for 0:21:58.800 --> 0:22:02.159 the environment. It's great E s G. What they what 0:22:02.280 --> 0:22:04.600 we all learned in twenty and twenty one is it 0:22:04.640 --> 0:22:07.320 also allows you to expand your audience. So more and 0:22:07.359 --> 0:22:10.000 more organizations are planning their s k oh. If you 0:22:10.040 --> 0:22:13.000 can't attend in person, pretend in person, If you need 0:22:13.080 --> 0:22:17.439 to attend remotely, pretend remotely. So I think it just 0:22:17.560 --> 0:22:21.440 opens up the world for you to attend a conference, 0:22:21.440 --> 0:22:25.840 whether you're physical or virtual. So and frankly, the main 0:22:25.880 --> 0:22:28.080 thing that Paul loves about going to the office is 0:22:28.119 --> 0:22:30.320 it's basically a conference every day. Are I don't know 0:22:30.320 --> 0:22:33.159 if you've been to our headquarters one Luxington Avenue, but 0:22:33.240 --> 0:22:37.760 it's an incredible space and of course being there with 0:22:37.880 --> 0:22:41.960 your co workers is really beneficial. The same as true 0:22:42.000 --> 0:22:44.399 at Big Banks. We've heard all the CEOs tell us, 0:22:44.880 --> 0:22:47.240