Speaker 1: This is Bloomberg Business Week. I'm Carol Masser. Every day
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Speaker 1: Global News. Do you want to get right to the
Speaker 1: Business Week agenda with us? Is Jina Martin Adams, chief
Speaker 1: equity strategist at Bloomberg Intelligence. She's on the phone in
Speaker 1: New Jersey. Also from New Jersey on the remote access
Speaker 1: is Ja Wilson, stocks editor at Bloomberg News. You know,
Speaker 1: so here we are again. The markets started off stronger,
Speaker 1: but we're definitely off our best levels of the session
Speaker 1: and we do see as Charlie mentioned at NASDAC lower Gina,
Speaker 1: you've been writing a lot about this. We focus a
Speaker 1: lot on the elections, but you really are focusing on earnings. Yeah,
Speaker 1: and the reason Carol we're focused on or is because
Speaker 1: I think what's happening the market is as much about
Speaker 1: rotation between market leaders at the sector level as anything else.
Speaker 1: I do think the election has certainly got some nerves frayed,
Speaker 1: and you see that in the fix and fixed futures
Speaker 1: markets sort of escalating over the last couple of weeks.
Speaker 1: But also underlying that overall nervousness is a rotation and
Speaker 1: leadership out of technology and into other sectors. We talked
Speaker 1: about the market being, you know, just kind of blaw today,
Speaker 1: not up a whole lot anymore after a pretty strong start.
Speaker 1: The reason is because tech stocks have sold off. If
Speaker 1: you look at the other sectors, energy stacks about more
Speaker 1: than three percent, materials and industrial stocks are up greater
Speaker 1: than two. But it's really trust tough for the broad
Speaker 1: rise without the participation of the tech sector. And that's
Speaker 1: an earnings thing. So even the earnings have beat expectations,
Speaker 1: the tech stocks have sold off. Why have they sold
Speaker 1: off because their earnings outlook is deteriorating a little bit.
Speaker 1: Other sectors are going to produce faster growth into and
Speaker 1: that's diminishing the case for paying very very high valuation
Speaker 1: multiples for tech stocks and logically right brain, left brain.
Speaker 1: You know, if we look at it, Gina, I mean,
Speaker 1: it makes sense considering the run up that we've seen
Speaker 1: in these tech names and performing and performing to support
Speaker 1: some of it. Yeah. Absolutely, And the reason that I
Speaker 1: think you also want to think about the reason behind
Speaker 1: the runup in the technique. You know, going into second
Speaker 1: quarter and even much of third quarter earnings, they were
Speaker 1: the only game in town. They're the groups that were
Speaker 1: actually still printing revenue and earnings growth. That dynamic will
Speaker 1: change going into the investment opportunity set improves. Tech stocks
Speaker 1: deserved a high valuation multiple relative to the market when
Speaker 1: they were the only stocks in the market creating earning growth,
Speaker 1: and they were the only stocks in a very defensive
Speaker 1: sort of portfolio really included a heavy tech concentration. Well,
Speaker 1: now that we're moving into a different kind of landscape, UM,
Speaker 1: it looks like the opportunities that will improve for other groups,
Speaker 1: and those groups are more value and cyclically oriented segments
Speaker 1: of the S and P. I'm going to ask you
Speaker 1: how much that cycle last in a moment, but I
Speaker 1: do want to bring in Dave Wilson and talk to
Speaker 1: us about this rotation. Dave what are you seeing. Well,
Speaker 1: that's it. I mean, if you think about tech in
Speaker 1: the broad sense, I mean it's not just information technology,
Speaker 1: it's also communications services where you find you know, Google's owner, Alphabet, Facebook,
Speaker 1: and then the consumer discretionary category that includes Amazon dot Com.
Speaker 1: Those are the only three groups that are down today,
Speaker 1: along the eleven main ones in the S and P
Speaker 1: five hundred, and there are plenty of stocks doing just
Speaker 1: fine after earnings. Uh. So you know, what what you're
Speaker 1: seeing is is sort of consistent with the idea that
Speaker 1: you know. It's it's those big tech companies have been
Speaker 1: drive in the market, and you know we've seen them
Speaker 1: come off lately. You mean Sarah ponzack I saw her
Speaker 1: chart out earlier today. I know she'll be on this
Speaker 1: program later on. Uh, just noting that if you go
Speaker 1: through those eleven main industry groups in the last month,
Speaker 1: tech it's been the worst performers. So, you know, it's
Speaker 1: kind of consistent with what we've seen lately in the
Speaker 1: way things have kind of been shifting around, but certainly
Speaker 1: isn't working to the market's favor at the moment. I
Speaker 1: know some value guys would be really happy to see
Speaker 1: some market rotation genet come on in though how long
Speaker 1: might this psycho rotation last, Like I do wonder how
Speaker 1: much of it is contingent upon the economic recovery, what
Speaker 1: we see in terms of more relief, Like I feel
Speaker 1: like there are some questions what one looks like which
Speaker 1: will determine who will continue to be the market leaders. Yeah,
Speaker 1: I think that's a very very good point. If you
Speaker 1: look at the outlook for earnings, is a pretty good
Speaker 1: benchmark for what to expect. Tech is going to undershoot
Speaker 1: earnings growth for the majority of one which means this
Speaker 1: could have legs for you know, at least until the
Speaker 1: second quarter, I think comes first quarter. A lot of
Speaker 1: this will depend on who's in the White House. You know.
Speaker 1: Clearly a blue wave is going to in my mind,
Speaker 1: continue the trends that has started in the market of
Speaker 1: cyclical rotation, because it most likely does mean that we
Speaker 1: get a pretty large fiscal policy package sometime in the
Speaker 1: first quarter. So even if in the short term you
Speaker 1: don't get any fiscal policy, investors are going to count
Speaker 1: on that fact come early and that's going to keep
Speaker 1: the value rotation moving forward in my mind, you know,
Speaker 1: And then also depends on how much we shut down again.
Speaker 1: You know, obviously Europe is is shutting down again. Most
Speaker 1: of us are assuming that the United States generally will
Speaker 1: stay open, allowing for reasonable economic conditions to maintain through
Speaker 1: the winter. But that's a wild card. You know, we
Speaker 1: could have a much more difficult economic scenario in the
Speaker 1: short run. Even then, though, I think most investors are
Speaker 1: going to take that opportunity to add to cyclical earners
Speaker 1: in anticipation of the policy outlook. I gotta say, I
Speaker 1: said that France number heard it this morning, not this morning,
Speaker 1: I think it was about one o'clock or a little
Speaker 1: bit after one our time. I mean, a record more
Speaker 1: than fifty two thousand new coronavirus cases. And it certainly
Speaker 1: made me sit up and take notice. Gina, Yeah, absolutely,
Speaker 1: And I think a lot of people are taking notice
Speaker 1: and kind of wondering what our response is going to
Speaker 1: be as we head into the winter. And you know,
Speaker 1: obviously escalation in infections in the US is problematic as well.
Speaker 1: Will a new administration um you know, clearly this new
Speaker 1: administration will would approach the virus contagion potentially differently than
Speaker 1: the past administration. If we do have a new administration,
Speaker 1: in the White House next year. So there's a lot
Speaker 1: of uncertainty, without a doubt. Yeah, exactly. And Dave, that
Speaker 1: kind of leads us to our chart quick tweet tease
Speaker 1: on which you got coming up in the chart of
Speaker 1: the day because it is election related, Yes it is.
Speaker 1: I mean, think about all the law and order issues
Speaker 1: that have come up during this race, and you know
Speaker 1: it's been a plus for the companies to make guns
Speaker 1: and ammunition. They always this watching this connection always just
Speaker 1: kind of blows my mind. All right, Davilson, We're gonna
Speaker 1: look forward to that. Thank you so much. Gina Martin
Speaker 1: Adams our thanks as always, Chief Equity Strategies at Bloomberg Intelligence,
Speaker 1: both of them joining us on the phone from New Jersey.
Speaker 1: This is Bloomberg Business Week with Carol Messer from Bloomberg Radio.
Speaker 1: You're listening to Bloomberg Business Week. Um, so much to
Speaker 1: get through in terms of the virus, and I've got
Speaker 1: to say we are seeing big surges numbers rising, especially
Speaker 1: in the Midwest, whether it's North Dakota, South Dakota, Wisconsin.
Speaker 1: Wisconsin in fact, I think is third behind North Dakota
Speaker 1: and South Dakota. When it comes to New cases per capita,
Speaker 1: and Nebraska and Iowa also up uh, and a look
Speaker 1: at some of the averages over the past week in Minnesota,
Speaker 1: the trend and new COVID cases and hospital admissions also upward.
Speaker 1: Let's get to someone who has really been so wonderful
Speaker 1: with us throughout the pandemic back with us, and we
Speaker 1: know she's busy. Dr Penny Wheeler. She's president CEO at
Speaker 1: a Line of Health. They've got twelve hospitals in the
Speaker 1: Minnesota area. They've got physicians, clinics, retail pharmacies throughout the
Speaker 1: Twin Cities metro area in eastern Minnesota. She joins us
Speaker 1: once again on the phone from Minnesota. Dr wheel are
Speaker 1: great to have you back with us. How are you,
Speaker 1: Thanks Carols, It's good to be back with you. Yeah,
Speaker 1: it's thanks. Just times here as we see those case
Speaker 1: counts go up in the hospitalizations go up as well,
Speaker 1: so so uh, there's some anxiety about that for certain
Speaker 1: I am wondering, what's the what are the conversations Dr
Speaker 1: Wheeler that you're having. You know, I mentioned the number
Speaker 1: over in France. We're watching Europe. I think everybody in
Speaker 1: the US is wondering, okay, is this where we are headed.
Speaker 1: France reporting a record fifty two thousand, five eighteen new
Speaker 1: coronavirus cases. That's a big number. Uh, And I wonder
Speaker 1: are you guys setting up are the facilities within your
Speaker 1: system and that you are involved with. Are you guys
Speaker 1: in anticipating another big surge or seeing it all? Yeah,
Speaker 1: we are, we are certain to see it already. I
Speaker 1: would say that you know, in our you know, in
Speaker 1: in minnes you know you just mentioned Carol, the surrounding
Speaker 1: states to Minnesota, all the Wisconsin and Iowa, we've all
Speaker 1: had about a higher than positivity rate. We've been creeping
Speaker 1: up and we've been seeing it around our border towns too.
Speaker 1: But we're in about eight percent prot you know, positivity rate.
Speaker 1: And I can tell you our hospital takes care about
Speaker 1: a quarter to a third of all um those in
Speaker 1: Minnesota affected by the virus. And we have doubled our
Speaker 1: census in COVID cases over the last two weeks. So
Speaker 1: it's coming quickly here. But what's what's you know, I'm curious,
Speaker 1: you know, certainly in some of the conversations we've had
Speaker 1: with within the medical community, is that we didn't have
Speaker 1: the playbook back in March, right, we were just scrambling
Speaker 1: to figure it all out. Get the equipment, get every
Speaker 1: you know, the places you know, get the systems, the
Speaker 1: necessary systems in place, or the equipment in place. I
Speaker 1: do feel like we are smarter now, and I hope so,
Speaker 1: but I do wonder what are you seeing or what
Speaker 1: have we learned from the past six to seven months,
Speaker 1: whether it's equipment, but also treating patients. Yeah, totally smarter,
Speaker 1: totally smarter, and how we're treating patients and supporting other
Speaker 1: organ systems and knowing how to treat them. So fewer
Speaker 1: people who are in our intensive care units are actually
Speaker 1: suc coming to the season dying so bad is good
Speaker 1: good news because we've learned more and we have more
Speaker 1: more treatments and more UM support available. You know, we
Speaker 1: do have the right now, the stuff available. We increasing
Speaker 1: testing significantly. I'll tell you the biggest channel for us
Speaker 1: is staffing. Staffing this appropriately for the search because of course,
Speaker 1: some of our health care workers are also people who
Speaker 1: are getting ill or having family members that are ill.
Speaker 1: So I the plea would be, boy, please do the
Speaker 1: distancing and masking. I know it's getting old and hard,
Speaker 1: but you're also protecting our healthcare workers significantly by doing so.
Speaker 1: You know, I think it's really interesting that you're saying that,
Speaker 1: because um I had a conversation actually with the CEO
Speaker 1: of Chipotle last week and I said, you know, same thing.
Speaker 1: You know, what has changed in your world, you know,
Speaker 1: since March and April in terms of the virus, And
Speaker 1: he said, one of the most recent challenges is that
Speaker 1: our own employees are getting sick and it makes it
Speaker 1: harder to run the restaurant. And I do think this
Speaker 1: is going to be maybe the story for the second
Speaker 1: third waves is you know, making sure that whether it's
Speaker 1: in healthcare, whatever industry, that we've got the necessary workers.
Speaker 1: And I know in healthcare it's critical, yeah, critical to
Speaker 1: just really the health of the community and our ability
Speaker 1: to treat people. So I worry that our capacity limitation
Speaker 1: will be healthy available staff. So it will be who limits.
Speaker 1: It won't be on the it won't be on the
Speaker 1: PPE right now, it looks like it won't probably be
Speaker 1: on the testing. It will be on that. So what
Speaker 1: do you do? Can you reach out to or what
Speaker 1: do you do? Do you reach out to your surrounding community,
Speaker 1: But they're also facing the same thing. Is there is
Speaker 1: there federal assistance that can help in this kind of situation.
Speaker 1: Not you know, we're not looking to federal assistance, but
Speaker 1: we can are collaborating wonderfully well among you know, the
Speaker 1: systems here, so that we're trying to just balance things out.
Speaker 1: If somebody doesn't have I few availability, who does, so
Speaker 1: we're not you know, this is the time again for collaboration,
Speaker 1: not competitiveness. And then we're continually working with each other.
Speaker 1: Like two of us are involved, for example, in vaccine
Speaker 1: trials that are going on, so we're trying to be
Speaker 1: proactive about you know, enrolling people in in in those
Speaker 1: trials as well. Yeah, I do wonder you know that,
Speaker 1: like I said that this is going to be one
Speaker 1: of the main stories at this point. Um. I do
Speaker 1: wonder too that one of the things that we saw,
Speaker 1: certainly when we were in the midst of it here
Speaker 1: in the New York metro area, that there was really
Speaker 1: this great kind of sharing of equipment, sharing of knowledge.
Speaker 1: And you know, what are you seeing, you know, as
Speaker 1: you deal with the entire healthcare community, or are you
Speaker 1: seeing that continued cooperation and assistance around the country. We're seeing,
Speaker 1: we're seeing the collaboration and cooperation here in spades, and
Speaker 1: well we can get you can manufacture equipment. What you
Speaker 1: can't do is manufactured talented, compassionate UM staff. And so
Speaker 1: again that's the that's the area that I think all
Speaker 1: of us are most concerned about dr UM well are
Speaker 1: One thing I wanted to know is in terms of
Speaker 1: those getting the virus, are the demographics changing? Is it older, younger?
Speaker 1: Is it a mixture. I'm just curious what you guys
Speaker 1: are seeing. Yeah, the demographics aren't changing into terms of
Speaker 1: those UM disproportionally affected who are black, indigenous people of color,
Speaker 1: so that's not changing. We are seeing a slight shift
Speaker 1: to younger UM people getting getting the virus uh UM.
Speaker 1: But otherwise profile and obviously the most of the very
Speaker 1: severe illness isn't. Sadly, the deaths occur in those who
Speaker 1: are in the older age groups or those who have
Speaker 1: chronic illnesses. So that's staying the same. Yeah, so very
Speaker 1: very similar. Listen, you know better than most it's all
Speaker 1: about you know, a vaccine. Although when you I'm curious
Speaker 1: how you feel about this. I feel like we continue
Speaker 1: to have conversations where more and more members of the
Speaker 1: medical community say, yep, a vaccines very important, but also
Speaker 1: really important is wearing your masks, social distancing, doing all
Speaker 1: all those simple things that can really make a difference
Speaker 1: in terms of our fight against this virus. Well, no
Speaker 1: question over emphasizing those over and over again. I heard
Speaker 1: one of your wonderful masks UH public service announcements while
Speaker 1: I was eating that's so important. The vaccine is important.
Speaker 1: It's it's not an all be all though. We're involved
Speaker 1: in a Johnson and Johnson ensemble vaccine trial with enrollment
Speaker 1: of people, and we're actually participant, you know, especially focused
Speaker 1: on populations of color, black, Indigenous, and people of color
Speaker 1: as participants, targeting specific zip codes. Sometimes these these studies
Speaker 1: are done too much on a more of you know,
Speaker 1: a white um population, and this is disproportionately affecting people
Speaker 1: of colors that we're actually targeting and asked to target
Speaker 1: our our vaccine trial accordingly. And then I think, Carol,
Speaker 1: you said it just right on the other side of things,
Speaker 1: we want a vaccine that can be trusted for sure,
Speaker 1: and that has safety, and that trust is important to
Speaker 1: people being able to actually get the vaccine. But remember
Speaker 1: even the even great flu vaccines, are you know, successful,
Speaker 1: and then there's a proportion that doesn't take them. So,
Speaker 1: you know, I also don't want people to think it's
Speaker 1: you know, we're flipping a switch and it's all over
Speaker 1: at that point too, But it's even when we get
Speaker 1: a safe one. Well, and that's a really good point.
Speaker 1: But I also think, you know, we continually talk um,
Speaker 1: you know, Penny about that when we get a vaccine,
Speaker 1: we've got to make sure it gets out to those
Speaker 1: most vulnerable populations as you guys are targeting. You said
Speaker 1: some zip code specifically of you know, black and indigenous,
Speaker 1: you know color people, And I do wonder do you
Speaker 1: have a lot of faith in the system that when
Speaker 1: it gets to you know, distribution logistics, that it will
Speaker 1: get to those people who really need it most. And
Speaker 1: what do we need to make sure that that happens? Boy?
Speaker 1: I do I do believe that will be true. You know,
Speaker 1: I'm an opport heart, but I think that those people
Speaker 1: who are most vulnerable and most willing, you know, those
Speaker 1: and in institutional settings that are elderly, those who are
Speaker 1: disproportionately affected, I think their acceptance rate will be higher.
Speaker 1: And when we have a vaccine that we can trust,
Speaker 1: I think that that will be going. I don't know
Speaker 1: that we will have widespread vaccine available, you know, right
Speaker 1: off the bat, but I think that those populations because
Speaker 1: of the UM, you know that the vaccine wo be widespread,
Speaker 1: yet will be the first one targeted for sure. One
Speaker 1: last question, I wonder what might surprise some of our listeners,
Speaker 1: especially here we are, what eight months in of dealing
Speaker 1: with this virus UM and you've seen it, like I said,
Speaker 1: front row seed for better or for worse? UM. You
Speaker 1: know what would surprise everyone about this fight, especially as
Speaker 1: it goes, You know, I would I'd have to say
Speaker 1: our staff. The resilience of our staff putting themselves on
Speaker 1: the line every day to try to care for others
Speaker 1: and going there day after day, um, despite their own
Speaker 1: personal fatigue. Obviously, this is affecting us all personally as
Speaker 1: well as professionally and all that that brings. And having
Speaker 1: school aged children that they're schooling at home and then
Speaker 1: coming and trying to take care of people, they are remarkable,
Speaker 1: just remarkable. So I know that that's a surprise to everybody.
Speaker 1: But when you see it day after day after day,
Speaker 1: you the human spirit and its resiliency in trying to
Speaker 1: work on behalf of others is pretty incredible. Well, I'm
Speaker 1: guessing as a leader, it's nice to see your staff, right,
Speaker 1: really just be out there, especially when everybody is stressed
Speaker 1: out on so many different levels. Um, Penny, thank you
Speaker 1: so much. Dr Penny wheel Er. She is president CEO
Speaker 1: at A Line of Health, joining us once again on
Speaker 1: the phone from Minnesota with a virus up update, excuse me,
Speaker 1: and just talking about the collaboration that they're doing with
Speaker 1: Johnson and Johnson as well and really targeting some of
Speaker 1: the specific zip codes, the specific you know, and most
Speaker 1: vulnerable populations. This is Bloomberg Business Week with Carol Messer
Speaker 1: from Bloomberg Radio. So we've talked about this. I feel
Speaker 1: like with the several business owners many of the restaurants space,
Speaker 1: including Danielle Bulu. It affects all kinds of industries, businesses,
Speaker 1: all sizes of businesses. It's really about how the big
Speaker 1: insurance companies have by and large refused to pay business
Speaker 1: interruption claims. This next story gets into it's gonna be
Speaker 1: featured in this week's issue of the magazine. Let's get
Speaker 1: into it. Bloomberg News Legal reporter David Yaffee Bellini joining
Speaker 1: us on the phone from Washington, d C. Along with
Speaker 1: Bloomberg business Week editor Joe Webber with us from Brooklyn.
Speaker 1: I feel, like Joe, the stakes here are enormous for
Speaker 1: everyone involved. Yeah, that's right. And when David came to
Speaker 1: us with this pitch, I think he really just immediately
Speaker 1: got our attention because we're about to see a case
Speaker 1: brought to a court by an attorney in New Orleans
Speaker 1: and it is basically the shot across the Bow, and
Speaker 1: I think all eyes are gonna be on it because
Speaker 1: it will be sort of it's basically business versus insurance
Speaker 1: and there's probably billions of dollars in this way in
Speaker 1: terms of how this one um sways effectively. UM and
Speaker 1: he happens to be an incredibly colorful character as well,
Speaker 1: so that made the story that much more enjoyable to read.
Speaker 1: It's a movie in the making. I have to say, exactly, David,
Speaker 1: who is this lawyer that we're talking about. He's a
Speaker 1: plaintiff lawyer in New Orleans named John hotel ing Um
Speaker 1: who has basically been ensuing insurance companies after major disasters
Speaker 1: since Hurricane Katrina. So he has a track record of
Speaker 1: representing businesses and coverage disputes, and this dispute over business
Speaker 1: interruption insurance is sort of the latest iteration of that.
Speaker 1: And how much money could we potentially be looking at here,
Speaker 1: like what what what's involved in this particular case and
Speaker 1: then what cases to come. So the amount of money
Speaker 1: in this particular case in New Orleans isn't entirely clear
Speaker 1: yet because the restaurant that he's representing hasn't actually filed
Speaker 1: a claim. Um, they're preemptively suing to kind of establish
Speaker 1: the legal precedent that insurers should be on the hook
Speaker 1: for damage caused by the pandemic. Um. But if you,
Speaker 1: you know, broaden this out to all the businesses across
Speaker 1: the country that have business interruption insurance and are suing
Speaker 1: to force their insurers to pay up. One industry estimate
Speaker 1: puts it in between fifty two billion dollars and two
Speaker 1: d and twenty three billion dollars a month that insurers
Speaker 1: would have to pay to cover the damage caused by
Speaker 1: the pandemic. And the argument that the insurance industry is
Speaker 1: making is that this would essentially wipe out their reserves.
Speaker 1: It's just not feasible for them to cover this many claims.
Speaker 1: I have to say. I mean, this kind of gets
Speaker 1: to like, why do you have insurance, right, and this
Speaker 1: whole idea of unprecedented when it comes to acts of
Speaker 1: either natural disasters or you know, just unexplained events, and
Speaker 1: I feel like that's going to be talked about a lot, David,
Speaker 1: when it comes to these cases. Yeah. Absolutely. I mean,
Speaker 1: the the other argument that the insurers keep making it
Speaker 1: that it's totally unprecedented because we've had catastrophes in the past,
Speaker 1: but they're they're isolated to a certain geographic region. There's
Speaker 1: a there's a hurricane in New Orleans, which is Stroy's
Speaker 1: businesses there, but at least it only affects, you know,
Speaker 1: one city or or a few cities. Um, Whereas the
Speaker 1: pandemic is like a hurricane happening in every city in
Speaker 1: the country at the same time, and every business in
Speaker 1: the country is disrupted in a major way, and it's
Speaker 1: just not possible for the insurers to respond. Um. The
Speaker 1: interesting thing is, you know, the pandemic took most parts
Speaker 1: of American society by surprise, but actually the insurance companies
Speaker 1: have been had anticipated at this moment for a couple
Speaker 1: of decades. After after stars UM a few of the
Speaker 1: insurance companies were forced to make big payouts to companies
Speaker 1: in China that had to shut down UM during during
Speaker 1: what well you know, stars was sort of reading through
Speaker 1: Asia in the early two thousand's UM and after that,
Speaker 1: insurance companies inserted language and some of these policies that
Speaker 1: seems to exclude damage caused by a virus from coverage,
Speaker 1: and part of the legal battle is whether that language
Speaker 1: should actually apply to the pandemic. UM. They're all of
Speaker 1: policies that don't include that sort of language. So the
Speaker 1: insurance companies have been have been thinking about this for
Speaker 1: a while, so they're not They're not entirely unprepared as
Speaker 1: this kind of legal battle ramps up. Okay, David, can
Speaker 1: we talk about the Lambas Yes? I said this guy
Speaker 1: was colorful and literally he has colorful cars. Um, what
Speaker 1: what is with the Lamborghinis? So John Hoteiling is a
Speaker 1: is a is a big luxury car enthusiast. He has
Speaker 1: an extensive collection of Ferraris and Lamborghinis. He he told
Speaker 1: me that that as a child growing up in New Orleans,
Speaker 1: he had a catalog, a kind of Lamborghini catalog or
Speaker 1: buyer's guy that he would flip through as a kid,
Speaker 1: sort of fantasizing about cars that he might be able
Speaker 1: to afford one day. And he kept this catalog. And
Speaker 1: when he actually became really wealthy, um, after you know,
Speaker 1: winning tons of big cases in the early two thousand's,
Speaker 1: you know, he went through this catalog and decided the
Speaker 1: Key would buy every single model all of Lamborghini advertised
Speaker 1: in it. And that was seventeen Lamborghinis. And so he's
Speaker 1: got those parked at a garage near his mansion in
Speaker 1: New Orleans, right right near this famous garden district. Um.
Speaker 1: And you know he's added to it over the years.
Speaker 1: He races luxury cars. He racism in a in a
Speaker 1: sort of in a big race in Italy every year. Um.
Speaker 1: So it's a it's a pretty it's a pretty vast
Speaker 1: and impressive collection of luxury vehicles. What's he like though,
Speaker 1: I mean it sounds like just first of all, it
Speaker 1: is like reading a novel, your story, Um, but just
Speaker 1: the dinner that you start off with. What is he like?
Speaker 1: I mean, how real is he? He's he's a he's
Speaker 1: a real person and he's really passionate about about this
Speaker 1: cause I mean he's He's not somebody who just showed
Speaker 1: up on the scene and started suing insurance companies because
Speaker 1: he thought that this was you know, this was like
Speaker 1: the biggest, biggest chance to make money off the pandemic
Speaker 1: or something like that. UM. He's been kind of an
Speaker 1: advocate on behalf of insurance policy holders since Katrina, which
Speaker 1: happened in his in his hometown. UM. He's really knowledgeable
Speaker 1: about these issues. UM. And he's done a lot of
Speaker 1: work to sort of unite um different types of businesses
Speaker 1: around the country and various lobbying efforts to get you know,
Speaker 1: laws passed that couldn't force insurers to pay out. UM.
Speaker 1: So so for him, it's a it's a kind of
Speaker 1: really personal battle and you know, not just kind of
Speaker 1: a moment of opportunism. UM. I just have to say
Speaker 1: I love how it it wraps up that, you know,
Speaker 1: while the insurance companies are saying, wait, this could kind
Speaker 1: of knock us, you know, out of business too, it
Speaker 1: feels like he's saying, I love the quote that you know,
Speaker 1: if I hit them one percent enough to buy a
Speaker 1: fleet of Ferraris in a private jet and houses all
Speaker 1: over and a humongous mansion with tens of millions and
Speaker 1: antiques in it. You don't cares to drop in the bucket.
Speaker 1: I mean, it's just it's it's kind of interesting to
Speaker 1: hear his take on this, and he sounds like quite
Speaker 1: a character. All right. It's definitely a mustery, uh and
Speaker 1: everybody should check it out. David, Thank you so much,
Speaker 1: David Yaffe Bellini. He's legal reporter at Bloomberg News. Check
Speaker 1: out the story at Bloomberg dot com and on the
Speaker 1: Bloomberg and will be in uh, the current issue or
Speaker 1: the upcoming issue of Bloomberg business Week magazine. Joe Webber,
Speaker 1: thank you as well, editor at Bloomberg business Week, joining
Speaker 1: us on the remote access from Brooklyn. So a great story.
Speaker 1: I'll put it out on Twitter as well because it's interesting.
Speaker 1: This is one of the big issues we've We've talked
Speaker 1: with Danielle Blue. We've talked with a lot of folks
Speaker 1: in the restaurant industry who were counting other insurance policies
Speaker 1: to kind of help them through and then kind of
Speaker 1: had a harsh awakening to see that they weren't necessarily covered.
Speaker 1: And as we know, the restaurant industry raisor within in
Speaker 1: terms of margins, and a lot of them just on
Speaker 1: the edge, any of the smaller players. It's been really tough.
Speaker 1: But it's not just restaurants. It's all kinds of businesses,
Speaker 1: and that is certainly what this case is all about.
Speaker 1: This is Bloomberg Business Week with Carol Masser from Bloomberg Radio. Hey,
Speaker 1: here we are Election Eve, just hours before holes officially
Speaker 1: open on the East coast of the United States, last
Speaker 1: day of campaigning for President Trump and former VP Joe
Speaker 1: Buying a hundred million early votes, already forecast to be
Speaker 1: in one third of the Senate also being elected. Race
Speaker 1: has become tighter of the last few weeks. Man, it's
Speaker 1: just one headline after another. Bloomberg News political contributor and
Speaker 1: Iona College professor a political science Jeanie Zo is back
Speaker 1: with us again from New Rochelle, New York. Genie, good
Speaker 1: to have you here. It is here almost. It's hard
Speaker 1: to believe. When you just said election Eve, I thought
Speaker 1: she can't really, Wow, it is, And you know, I
Speaker 1: would just add another number that I read earlier today,
Speaker 1: which is fourteen billion dollars spent by federal candidates, committees
Speaker 1: and outside groups raised and spent this election cycle. Breaking
Speaker 1: all records obviously, but it's you know, it's almost a
Speaker 1: mind numbing number to imagine spent on an election. Well,
Speaker 1: you know, we always say it's not different this time around,
Speaker 1: Yet it feels really different this time around. Is it?
Speaker 1: You understand elections? You see cycles. I mean, is are
Speaker 1: there things that make it different this year? Absolutely? Obviously
Speaker 1: the pandemic number one, and the amount of people that
Speaker 1: have engaged in early voting. You know, we just talked
Speaker 1: the last week. It was you know, I can't remember
Speaker 1: where we were at that point, fifty million or whatever
Speaker 1: it was, and now we are over nine million at
Speaker 1: the latest. This is a third of Americans almost, it is.
Speaker 1: It is a stunning number, and I think, you know,
Speaker 1: if it's any indication of what we see on Tuesday,
Speaker 1: we're going to see you know, record breaking or near
Speaker 1: record breaking, very high turnout. And it's astonishing. And I
Speaker 1: think one thing we don't do enough is give credit
Speaker 1: to the American public and also the poll workers who
Speaker 1: are out there making this happen, because you know, it's
Speaker 1: you know, there was a time several months ago when
Speaker 1: we thought maybe people simply wouldn't go out to vote,
Speaker 1: or wouldn't engage because of COVID, and yet we've seen
Speaker 1: exactly the opposite. Yeah, that's really fascinating. I agree with you,
Speaker 1: and I think we were concerned about a lot of
Speaker 1: times at polls. It's a lot of older individuals who
Speaker 1: were to be nervous about being there because of COVID.
Speaker 1: So one thing I've got to ask you, I mean,
Speaker 1: you watch the polls. There are lots of them. I
Speaker 1: just kind of go through it every morning, and you know,
Speaker 1: we reminded that last time around we got it wrong. Um,
Speaker 1: is there something different about the methodology this time around
Speaker 1: that can make us look at certain poles or poles
Speaker 1: in general as being more reliable this time around? There
Speaker 1: are there are some differences. The number one difference is
Speaker 1: that we have a lot more polls than we had
Speaker 1: in sixteen, and particularly in the battleground states, and they
Speaker 1: are polling later. Like you know, we have seen polls
Speaker 1: over this weekend still coming today which are giving us
Speaker 1: indications about important states like Pennsylvania. But the sheer number
Speaker 1: of polls, and then the posters did try to learn
Speaker 1: from in areas where they may have missed, and things
Speaker 1: like trying to do a better job of voter turnout
Speaker 1: and and reaching those voters who are actually going to engage.
Speaker 1: Of course, the pandemic has you know, thrown a monkey
Speaker 1: wrench into all of it. But we have seen a
Speaker 1: different tact and I you know, we don't know yet
Speaker 1: if it's going to pay off, because there is still
Speaker 1: the question are people being honest with pollsters? You know,
Speaker 1: are these numbers actually reflective of what we're going to see?
Speaker 1: But I think the one thing to keep in mind
Speaker 1: the polls have been remarkably steady throughout all of these
Speaker 1: changes in this election cycle, and by and large they
Speaker 1: have shown Joe Biden in the lead, although in some
Speaker 1: cases within a margin of error. And so that's where
Speaker 1: we are as we approach election day. But again, you know,
Speaker 1: things can change at the last minute. Well what do
Speaker 1: you make to you have listened? We talked a lot.
Speaker 1: I know, Bloomberg business Week magazine did a whole story
Speaker 1: on like the shy Trump voter, right that people back
Speaker 1: in sixteen wouldn't come out and say we're going to
Speaker 1: vote for Donald Trump, and yet they did, you know privately,
Speaker 1: uh ultimately when they went and pulled the lever. I
Speaker 1: was watching some coverage of people talking about shy Biden
Speaker 1: UM followers. Whether you're in a very kind of normally
Speaker 1: red state like of Arizona, where you're afraid to kind
Speaker 1: of come out and say something. So I do wonder
Speaker 1: are there a lot of you know, are we still
Speaker 1: in a situation where people maybe don't want to say
Speaker 1: who they are voting for? I think so. I do
Speaker 1: think so. So we you know this this notion of
Speaker 1: a spiral of silence where people feel that something is
Speaker 1: not you know, politically or socially acceptable in their circles,
Speaker 1: so they won't certainly admit it to a stranger who
Speaker 1: calls them on the phone for a poll. Um. So,
Speaker 1: whether that's you know, you're going to support Joe Biden
Speaker 1: and you're in a red state, or you're going to
Speaker 1: support Donald Trump and you're in a blue state. I
Speaker 1: do think we know that that is out there. The
Speaker 1: extent of it, I think is a big question. We
Speaker 1: know the Trump team feels that there are a lot
Speaker 1: more of those people out there than you know, many
Speaker 1: researchers have been able to document. But some of this
Speaker 1: is just going to take after election day comparing what
Speaker 1: are the actual results to what people were telling the posters.
Speaker 1: Everything at this point now becomes you know, guessing within
Speaker 1: a margin of error in a probability, what do you
Speaker 1: think you're going to be? Ultimately, the key groups that
Speaker 1: maybe show up at the polls that haven't in the past.
Speaker 1: Is it minorities? Is it women? Um? What is it
Speaker 1: or that? And and if maybe shifted who they were
Speaker 1: supporting last time around. I think women, um, white women
Speaker 1: we're going to be looking at, particularly in the suburbs. UM.
Speaker 1: I think seniors. Uh, we're seeing a much more marked
Speaker 1: support amongst seniors for Joe Biden than Democrats have enjoyed
Speaker 1: in two decades. And I would also say I'm keenly
Speaker 1: interested in young people. They seem to have a lot
Speaker 1: of energy. Will there won't they turn out? They usually
Speaker 1: don't turn out and as record numbers as you know,
Speaker 1: their their counterparts, but I'm interested to see if they do.
Speaker 1: And then of course over the weekend we're hearing concern
Speaker 1: amongst Democrats about African American turnout in key states like Florida,
Speaker 1: So that's also going to be interesting. And you know,
Speaker 1: we talk a lot about shifts, Donald Trump shifting over
Speaker 1: some African American men. They're estimating about which is not huge,
Speaker 1: but much better than Republicans normally, do what I mean?
Speaker 1: And what is you know, still, the issue is it
Speaker 1: the economy? Is a virus? It was interesting the coverage
Speaker 1: this weekend, and it was all maybe because of the
Speaker 1: spikes that we're seeing in cases once again in this
Speaker 1: country and just globally. You know, is it the virus?
Speaker 1: What are people voting on? Typically it's do you feel better?
Speaker 1: Do you have a job? Do you feel economically better?
Speaker 1: We just got about thirty seconds and then we'll come
Speaker 1: back and talk some more. But what is it? I'm
Speaker 1: guessing it's going to be COVID, but I don't know
Speaker 1: for certain. That is the big question. Can I just
Speaker 1: ask you first of all, was it a little crazy
Speaker 1: some of the stuff that was happening on the campaign
Speaker 1: trail this weekend? I thought, so I was watching, and
Speaker 1: you know, I think most worrisome to me was the
Speaker 1: you know, disruption that occurred in terms of the Trump
Speaker 1: supporters disrupting the you know, the bus of that. To me,
Speaker 1: and then the president you know, seeming to support that,
Speaker 1: that's very troublesome. And I know you've probably seen I've
Speaker 1: seen things boarded up in New York City and White
Speaker 1: in DC. That's a scary proposition because we may not
Speaker 1: have results on Tuesday night, and if that encourages people
Speaker 1: to respond in that manner, that's that's going to be
Speaker 1: really upsetting. Well, so, Je, what do you make of
Speaker 1: the president come out and saying basically, you know, we're
Speaker 1: going to have a decision. We're gonna I'm gonna declare like,
Speaker 1: you know, the results of the election. You know, it's
Speaker 1: it's you know, like so many things with Donald Trump,
Speaker 1: like nothing I've ever imagined hearing a president say, um,
Speaker 1: I can't imagine that he will do that. Christopercy this
Speaker 1: weekend said he would not. Um, but the President, as
Speaker 1: you mentioned, said he would. He's going to be at
Speaker 1: the White House apparently tomorrow, and he said whether the
Speaker 1: votes are counted or not fully, he will declare victory. Um.
Speaker 1: You know, I think it's going to depend an awful
Speaker 1: lot on the margin if it's a you know, I
Speaker 1: think if it's a large margin that Biden has won by,
Speaker 1: I don't think it will happen. If it's close, though,
Speaker 1: I think we're going to see them filing lawsuits, and
Speaker 1: I think we're going to see two thousand, you know,
Speaker 1: in on steroids, and you know a few states versus
Speaker 1: just one. Well, and I do wonder. I mean, from
Speaker 1: what I understand, Florida, I think, Arizona, North Carolina. Those
Speaker 1: are some of the states where early voting has been
Speaker 1: happening for a long time and they've already count been
Speaker 1: counting for a couple of weeks. I mean, what are
Speaker 1: the key states that we need to kind of watch
Speaker 1: because you've been so smart in reminding us it's not
Speaker 1: that's why we don't look at the national polls. You've
Speaker 1: got to look at the individual states. Right, It's fifty
Speaker 1: separate elections going on essentially, and it all comes down
Speaker 1: to electoral college and who gets the vote. So what
Speaker 1: are the states you're going to be watching really closely
Speaker 1: tomorrow night? I think early tomorrow we should be watching Florida, Georgia,
Speaker 1: North Carolina. As you mentioned Florida for instance, as a
Speaker 1: long history with mail and ballots there, we expect that
Speaker 1: they will be releasing results early. And if the you know,
Speaker 1: Joe Biden wins one of those, that would pretend to
Speaker 1: bad sign for the president. If the president holds out
Speaker 1: in all of those and the big questions to me
Speaker 1: are Georgia and North Carolina. Then this will shift to them,
Speaker 1: you know, the Midwest, Pennsylvania, Wisconsin, Michigan. UM. So I
Speaker 1: will be watching for those early sun belt states first
Speaker 1: because if the president and now, of course, if the
Speaker 1: President exceeds expectations and does really well in those states,
Speaker 1: then he could you know, match what he did last
Speaker 1: time around, but we suspect it will be at least
Speaker 1: closer than it was last time. What are the states
Speaker 1: that we've got to be really smart about that they're
Speaker 1: only starting early voting counts, you know on election day,
Speaker 1: which we know physically is going to be probably impossible
Speaker 1: to count and get to all of them. Is it Ohio?
Speaker 1: Is it Pennsylvania? The biggie to me is going to
Speaker 1: be Pennsylvania because we know that, you know, the sheer
Speaker 1: number that they are receiving and the way that they're
Speaker 1: going to be proceeding and when they start means we
Speaker 1: probably won't get elected, won't get results out of there
Speaker 1: on Tuesday night, and of course they're receiving them well.
Speaker 1: Also North Carolina. So I think those states, you know,
Speaker 1: North Carolina, we may know a bit early, but I
Speaker 1: think Pennsylvania is going to be the big one, and
Speaker 1: again that's going to be critically important if everything comes
Speaker 1: down to those Midwestern states, and of course Pennsylvania is
Speaker 1: the one that the President has the best shot of winning. Um.
Speaker 1: You know, Wisconsin, Michigan, the polls at least seemed to
Speaker 1: suggest Biden have a much larger margin there. What are
Speaker 1: you anticipating tomorrow night, Um, I'm anticipating probably one of
Speaker 1: those scenarios where the President holds some of those states
Speaker 1: and we do come down to a Pennsylvania. Um. You know,
Speaker 1: I would be stunned if Joe Biden won Florida. But
Speaker 1: if he does, it's going to be a very very
Speaker 1: good night for Democrats. Florida has not been kind in
Speaker 1: the past, the last conditorial race to Democrats. So I'm
Speaker 1: really curious to see from those early states that we
Speaker 1: get results out of. You know, if Biden happens to
Speaker 1: take that one, or a Georgia or certainly at Texas,
Speaker 1: this could change the map for many elections to come.
Speaker 1: And also votes very well for Joe Biden. But I
Speaker 1: suspect the President will do a bit better and then
Speaker 1: we may come down to a Pennsylvania what does it say.
Speaker 1: More broadly, I think about your teaching genior class and
Speaker 1: that you know, we've been having conversations in my home
Speaker 1: that I mean, it really is so close. Despite you
Speaker 1: could have, depending on where you are in the country,
Speaker 1: it could feel like it's a very red country or
Speaker 1: a very blue country. But yet it really is very divided.
Speaker 1: It's very divided, and I think you know, to me
Speaker 1: from a broader perspective, I think if we go back
Speaker 1: to sixteen and you have somebody winning by three million
Speaker 1: votes and somebody else getting the president winning the popular
Speaker 1: roles three million, and somebody else getting the presidency by
Speaker 1: seventy seven thousand, I think that discrepancy. If we see
Speaker 1: and I'm not sure, but if we see something broader
Speaker 1: than that this time around, I think we really do
Speaker 1: have to ask about whether we should have an electoral college, because,
Speaker 1: you know, two for seventy seven thousand people's votes to
Speaker 1: count that much more than three million or more, that
Speaker 1: seems highly undemocratic too many people, and I think that
Speaker 1: only sort of frustrates this sense that we don't live
Speaker 1: in a fair, transparent democracy. Yeah. I can't help but
Speaker 1: think if the forefathers were watching all of this and saying,
Speaker 1: you know what, guys, we created that system a long
Speaker 1: time ago. It's time to maybe do a little bit
Speaker 1: of a rethink, right absolutely. I think that's a big thing.
Speaker 1: And I think, of course we have to rethink polling
Speaker 1: too if we got this wrong. Oh man, such good stuff.
Speaker 1: I love, love, love your insight. Thank you so much,
Speaker 1: and I knew you've been doing a lot for us,
Speaker 1: and you're going to continue through election and thereafter. Blueberg
Speaker 1: News political contributor and I own a college professor of
Speaker 1: political science, Jeanie Zeno on the phone from New Rochelle,
Speaker 1: New York Journal. Now, but you let me drive, no, no, please,
Speaker 1: I want to drive. Strive time question. This is the
Speaker 1: drive to the Globe. Thanks, we'll drying us. Dawn on
Speaker 1: Bloomberg Radio, It is time for the Drive to the close.
Speaker 1: Back with this is David Did's, President, chief investment officer
Speaker 1: at Point View Wealth Management seven point three billion in
Speaker 1: assets under management. David is with us once again, on
Speaker 1: the phone from Semit, New Jersey. David, nice to have
Speaker 1: you back with us. This is a jam packed week, man,
Speaker 1: between the election, between the Fed, between the Job's report,
Speaker 1: there's just so much going on, We're still getting through earnings.
Speaker 1: How do you make sense of it? And I'm curious
Speaker 1: our investors, are you finding more new money coming or
Speaker 1: what are some of the interesting trends that are happening
Speaker 1: right now? Yeah? Absolutely so. We've really got a trifect
Speaker 1: of issues that are confronting us. That would be the election,
Speaker 1: that would be the vaccine, that would be stimulus. UM.
Speaker 1: And what I've been telling investors really is just a
Speaker 1: matter of time here before we're going to get some resolution.
Speaker 1: Hopefully we know more at least by the end of
Speaker 1: the week as to how the elections works out. UM investors,
Speaker 1: I think what they want now is just kind of
Speaker 1: a clear signal as to what's going to happen is
Speaker 1: the uncertainty. I think investors have gotten comfortable that, no
Speaker 1: matter who wins, their marching origin is going to be clear.
Speaker 1: You know, get the vaccine going, get the stimulus going,
Speaker 1: get this economy going against. I think they're comfortable there. Um.
Speaker 1: You know, in terms of the stimulus, I don't know
Speaker 1: whether we're gonna get anything in the lame duct session here,
Speaker 1: but we'll definitely have something before the end of January.
Speaker 1: In terms of what clients investors are doing right now.
Speaker 1: I think they're basically just just staying put here um.
Speaker 1: Obviously October was a rugged month. On the other hand,
Speaker 1: the smaller guys a smaller fries to wrestle through thousand UM.
Speaker 1: They were up about to percent in the musto. Obviously,
Speaker 1: it's a mixed market and we're seeing some rotations to
Speaker 1: some of the areas of the market that have been
Speaker 1: left behind. Her Well, that's exactly how we kicked it off.
Speaker 1: On this Monday, we were talking with our Gina Martin
Speaker 1: Adams and she just talked about market rotation and you know,
Speaker 1: said specifically, it's really an earnings thing. You know that
Speaker 1: tech was the big story back in the second quarter,
Speaker 1: and rightfully so those valuations were justified because they were
Speaker 1: producing earnings. But now we were seeing, you know, change
Speaker 1: in terms of thought and that we're seeing market rotation.
Speaker 1: She thinks that tech will undershoot earnings growth from much.
Speaker 1: Do you agree with that, and that this market rotation
Speaker 1: might stay with us for some time or if we
Speaker 1: get more stimulus than that could change things. Bottom line
Speaker 1: is stay diversified, you know, call but everybody says that
Speaker 1: all the time. David the timing of of a rotation
Speaker 1: is always difficult. But what we have seen here is
Speaker 1: that although by and large, other than perhaps for Twitter,
Speaker 1: the megacap tech results were stellar. The problem is they're
Speaker 1: up anywhere from thirty seven to se your day, and
Speaker 1: so the valuations for two stretched. It was that they
Speaker 1: weren't meeting expectations. They weren't meeting the whisper numbers. So
Speaker 1: that cause that tells me you have to be cautious
Speaker 1: in that area. But what what I am saying here
Speaker 1: is generally dividend paying stocks hold their own, if not outperformed.
Speaker 1: But starting in February when we started to get the
Speaker 1: COVID coming in, the eighty highest dividend paying stocks of
Speaker 1: the spire are down twenty six percent while the SNP
Speaker 1: is flat, pulled up by those megacap techs. Now, what
Speaker 1: what can I tell you from that? That disparity is
Speaker 1: not going to happen in the next nine months. So
Speaker 1: the question is through the dividend payers start moving up
Speaker 1: or the mega tech start moving down. Is probably a
Speaker 1: little bit of both, and that's where these dividend paying
Speaker 1: stocks I see a lot of opportunit to me, particularly
Speaker 1: as you point out earlier. The Federal reserve is really
Speaker 1: going to be on hold for a long period of time.
Speaker 1: It's such a great old kind of play, right when
Speaker 1: it comes to dividends. But I mean, when you look
Speaker 1: at some of these companies, and I guess it explains
Speaker 1: why you like a name like Coca Cola or maybe
Speaker 1: a name like Chevron. Yeah, so let's talk about Coca Cola.
Speaker 1: Coca Cola in terms of beverages and bin is three
Speaker 1: times the size of his next largest competitor in that
Speaker 1: out non alcoholic space. That gives you so many scale benefits. Now,
Speaker 1: normally you can't get a company like this, which is
Speaker 1: the differdend close to four percent, and here you have
Speaker 1: it is down from it's fifty two week Hi, So
Speaker 1: why is that? Is? Because guess what we pay less
Speaker 1: for coke when we drink it at home as opposed
Speaker 1: when we got to the ballpark or to the restaurant
Speaker 1: and buy. And I think at some point, maybe a
Speaker 1: year from now, could take a while, we will be
Speaker 1: back to normal. And of course you're gonna get that
Speaker 1: pick up in the stock price of cocause it goes
Speaker 1: back up, and meanwhile, you're collecting that three percent plus dividends.
Speaker 1: That seems to me a low risk way to stay
Speaker 1: in their relative to when you have a you know,
Speaker 1: eighty basis point and the ten your treasury. All right, Chevron,
Speaker 1: talk about a dividend. I mean that's a killer. We're
Speaker 1: talking about over seven Yeah, you know, it's seven point
Speaker 1: three percent. And what I also like about Chevron is
Speaker 1: it's a member of the exclusive dividend aristocrats club. What
Speaker 1: does that mean, Carol? That means it is not only
Speaker 1: paid to the dividend, but increased it for twenty five
Speaker 1: years in a row. That shows to me the commitment
Speaker 1: to make sure you're returning the profits to the shareholders. Now,
Speaker 1: certainly energy has been under pressure. We're paying the lowest
Speaker 1: prices of the pump now is we have in twelve years.
Speaker 1: But with the amount of deficit spending, with the economy
Speaker 1: potential in the rebound, my guess is energy prices go
Speaker 1: up from here. Chevron conservative balance sheet, one of the
Speaker 1: largest in the world, is well poised to take advantage
Speaker 1: of that percent. So you've got to really I mean,
Speaker 1: I understand the dividend, but you really do lose a
Speaker 1: lot in terms of the share price, no question about it.
Speaker 1: People who bought it a year ago. Hurden. I'm talking
Speaker 1: about getting involved now and of course to regain that.
Speaker 1: With the way the math works, that's almost a double look.
Speaker 1: If that takes six years plus collecting your seven percent,
Speaker 1: I think you're gonna do better than most people in
Speaker 1: the marketplace. So one more name, I just want to
Speaker 1: ask you about Affleck. The insurance guys. What is it?
Speaker 1: What's the thinking? They're same thing? Well, so Affleck isn't
Speaker 1: that beaten down insurance group. But the beauty of an
Speaker 1: insurance company is that they don't have that um tricky
Speaker 1: loan portfolios. They have to wonder whether the loans are
Speaker 1: gonna be repaid. You know, here's a company again who's
Speaker 1: increased that dividend for thirty seven years in a row.
Speaker 1: Normally that dividend has a one handle. Now it's over
Speaker 1: three percent. But they're only paying a quarter of their
Speaker 1: earnings out for dividends to they have room to continue
Speaker 1: to increase it. In fact, that dividends going up eight
Speaker 1: percent per year for the last five to ten years.
Speaker 1: It's a supplemental insurance program. You know, as we know,
Speaker 1: everything's focused on COVID. People are cautious about spending on
Speaker 1: anything that's not an actual essential. But I do believe
Speaker 1: that people will come back to continuing to expand the
Speaker 1: Affleck program. They're big in Japan. The US DOL has
Speaker 1: been weakening. That helps them. And of course they have
Speaker 1: a huge stock buyback program one million shares who want
Speaker 1: to buy back as soon as they can. All right,
Speaker 1: Gonna leave it on that note, David, Thank you so much.
Speaker 1: David Died's president and chief investment officer of at point
Speaker 1: View Wealth Management, seven point three billion annaucets under management
Speaker 1: UH and liking a common theme the dividends Coca Cola,
Speaker 1: Chevron and Afflack. Thanks so much for listening to Bloomberg
Speaker 1: Business Week. Download the podcast on iTunes, SoundCloud, or at
Speaker 1: Bloomberg dot com, and be sort of check out our
Speaker 1: daily radio show at two pm Eastern on Bloomberg Radio,
Speaker 1: and be sure to watch us too on YouTube by
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