Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene, along
Speaker 1: with Jonathan Ferrell and Lisa Brownwitz Jaileye. We bring you
Speaker 1: insight from the best and economics, finance, investment, and international relations.
Speaker 1: Find Bloomberg Surveillance, an Apple podcast, Suncloud, Bloomberg dot Com,
Speaker 1: and of course on the Bloomberg terminal. Everybody seems to
Speaker 1: be saying this morning and over the last few weeks,
Speaker 1: expect volatility. This is the line from City Expect volatility.
Speaker 1: Because we are no longer at the beginning of this cycle.
Speaker 1: Leadership becomes less clear at this time in the cycle,
Speaker 1: and while the leadership will narrow, it can also be
Speaker 1: quite shoppy. Let's get to Christine Bitterly, City Regional head
Speaker 1: of Investments for North America's Christy, let's start there. Why
Speaker 1: should we expect volatility? So when we look at any cycle,
Speaker 1: right when you're you're looking at the beginning of a cycle,
Speaker 1: that's where you see the strongest rallies. And we've see
Speaker 1: in that over the past twelve months, we've seen essentially
Speaker 1: everything moving up and and there's been periods of different leadership,
Speaker 1: very clear periods of whether it was growth versus value
Speaker 1: COVID defenses versus COVID cyclicals. But now the leadership isn't
Speaker 1: quite clear, and so one of the things that has
Speaker 1: investors very, very nervous and why we're expecting volatility is
Speaker 1: that realized volatility in US equity markets are at the
Speaker 1: lowest end of the twenty year range, in the single digits.
Speaker 1: And you can see this through the market action that
Speaker 1: we've seen. We've not had one pullback of five per
Speaker 1: cent or more in one This has only happened twice
Speaker 1: since nineteen and well, we've had a couple of pullbacks
Speaker 1: of about three percent, they've been bought very very quickly,
Speaker 1: and so I think this has a lot of investors wondering, Okay,
Speaker 1: well we actually see realize volatility rise, and will that
Speaker 1: put us into what is actually a pretty normal equity
Speaker 1: market of a couple of pullbacks of five per cent
Speaker 1: or more and even up to one of ten percent.
Speaker 1: But Kristen, is this the same equity market as ten
Speaker 1: thirty years ago? And I'm looking at the dominance of
Speaker 1: the big names, I'm looking at the composition that has
Speaker 1: actually performed very differently depending on which sector of the
Speaker 1: market you're looking at. I mean, can we get a
Speaker 1: broad based five percent draw down given how much money
Speaker 1: and given how selective people are with respect to sector selection. Yeah,
Speaker 1: it's a great point, right when we're looking at the
Speaker 1: rally that we've seen even year to date, there has
Speaker 1: been a lot of breakdown in correlation so up until
Speaker 1: even recently, right the under performance of small caps when
Speaker 1: you look at what we went through with with the
Speaker 1: delta variant, almost like a mini kind of what we
Speaker 1: went through last year in terms of tech coming out
Speaker 1: ahead as opposed to value really dominating the first on
Speaker 1: half of the year. I think what the market is
Speaker 1: going to differentiate going forward, and this is where we're
Speaker 1: allocating in our portfolios, is to quality. So this becomes
Speaker 1: much more a conversation around those companies with strong balance
Speaker 1: sheets that have the ability to grow their earnings, have
Speaker 1: the ability to grow their dividends, which is very important
Speaker 1: in this rates environment, and so earnings are really going
Speaker 1: to drive this conversation and fundamentals going forward. So a
Speaker 1: flight to quality. You have a lot of other calls
Speaker 1: to get a little bit more defensive within this equity market, Kristen,
Speaker 1: But is it time to go to cash? So we
Speaker 1: do not believe it's time to go to cash. So cash,
Speaker 1: there's really multiple purposes of cash. Right from an investor perspective,
Speaker 1: one of course, have a safety net, have your operating
Speaker 1: cash what you need. But in terms of an investment,
Speaker 1: right now, when we look at the inflationary pressures, this
Speaker 1: is an asset that's guaranteed to lose money. And so
Speaker 1: if you want some tactical cash in your portfolio because
Speaker 1: you are there to buy the dip, you can confidently
Speaker 1: buy the dip. There's some value in that. But what
Speaker 1: we're seeing in a lot of investors portfolios, and we've
Speaker 1: seen this for several months, is a lot of cash
Speaker 1: sitting on the sidelines. So this is no longer about
Speaker 1: an investment decision. This is really someone trying to market time,
Speaker 1: which doesn't work in the short run or the long
Speaker 1: run for that matter. Christan, just to conclude, I want
Speaker 1: to go through this research report and might get really
Speaker 1: clear some of the think that you're highlighting. Lumber down
Speaker 1: sevent since May on all down thirty percent of the
Speaker 1: same time period, Chinese equities down thirty percent is the
Speaker 1: middle of February. Brasilian equities getting hammered as well. US
Speaker 1: small camps down to performing is the middle of March
Speaker 1: at the time of publishing those numbers are assume were correct,
Speaker 1: and I'm sure they're still there and they're abouts the same,
Speaker 1: christin what's the punch line here? So the punch line
Speaker 1: is despite a lot of the central bank support and liquidity,
Speaker 1: markets are differentiating, right, and that's that's quite healthy. I
Speaker 1: think what you need to do as an investor again
Speaker 1: always bringing this back to actionable ideas and what we
Speaker 1: can do within our portfolios, is this becomes a period
Speaker 1: of being selective. Right, this is not a market of
Speaker 1: everything is going to go up, everything is going to win,
Speaker 1: and so being selective not only in terms of regions
Speaker 1: of the world that you're in, as you've been discussing
Speaker 1: all morning, but also in terms of security selection because
Speaker 1: there will be winners and losers based on fundamentals and earnings.
Speaker 1: Christ and always got to cash out with you. Thanks
Speaker 1: for being with us. Christin Biddley there of city people
Speaker 1: have missed out on the upside, how much becomes above
Speaker 1: love and response where if in doubt by right and
Speaker 1: this idea that if you miss out, you will just
Speaker 1: keep missing out, because that's how it has been over
Speaker 1: the past twenty years. What breaks that paradigms brund shooting.
Speaker 1: Now we can do that with Northwestern's Mutual Wealth Management
Speaker 1: chief investment strategist Brend your words, investors and the three
Speaker 1: camps they fall into right now, Those were the economy
Speaker 1: is growing too fast, those worried growth is peaking, and
Speaker 1: those worried stock valuations are simply too high. Are you
Speaker 1: in any of those three camps right now? Brent, No,
Speaker 1: It was something we worried about. So we got to
Speaker 1: mayor June and economic growth was finally strong, COVID cases
Speaker 1: were declining, and we all set around and thought about
Speaker 1: what is next. And I think as you've kind of
Speaker 1: been tweaking, lisagested that people were worried about those three
Speaker 1: things occurring. That was where the worries were. We see
Speaker 1: each one of those subsiding as you move towards the
Speaker 1: end of the year, and that to us means a
Speaker 1: higher equity market led by more cyclical aspects of the market.
Speaker 1: So think value stocks, think uh, small cap stocks, and
Speaker 1: think the Eurozone, and so we do think there's room
Speaker 1: left to run. It's just you've had this defensive versus
Speaker 1: cyclicals defenses have really won the day over the summer.
Speaker 1: But I think it's because of those three worries, and
Speaker 1: I think each one of those three pulls back into
Speaker 1: the end of the year, and I think that's the
Speaker 1: impetus for the rally that we expect to occur. Bright,
Speaker 1: Let's try to put some quantification around how much room
Speaker 1: there is to rally. What kind of returns are you
Speaker 1: expecting are you shooting for with the likes of a
Speaker 1: small cap bet at this point in the cycle. Well,
Speaker 1: I mean, I think everything is less than it was before, correct,
Speaker 1: And so if I think back to last year, we
Speaker 1: went overweight equities with an uncertain outcome, but but the
Speaker 1: opportunities that was so wide. I think about today, I'm
Speaker 1: a bit more certain about what the economy holds pushing forward.
Speaker 1: There are still, as always uncertainties, but the opportunity set
Speaker 1: is smaller, and so I think about relative performance more
Speaker 1: and I think small caps are set to outperform their
Speaker 1: large cap counterparts, and the Eurozone is set to outperform
Speaker 1: probably both of those and so much much more muted returns,
Speaker 1: but still in the contact of a tenure treasury. As
Speaker 1: you opened the show at one two three. Whatever it
Speaker 1: is today, stocks are still a relative valuation advantage towards
Speaker 1: bonds and that isn't changing until the ten your treasury changes,
Speaker 1: and that's still where central banks are impacting the most. Well,
Speaker 1: brend I'm glad you brought that up because we were
Speaker 1: having a conversation in the previous hour about big tech
Speaker 1: and how it was kind of unusual that we had
Speaker 1: record highs for the Fang stocks yesterday on a day
Speaker 1: when yields actually rose. But when we saw the low
Speaker 1: for the NASDAC one hundred this year, it was on
Speaker 1: March eighth, and the tenure treasury yield was at one
Speaker 1: sixty on that day. We are still twenty five basis
Speaker 1: points below that. So can you make a case really
Speaker 1: against big tech if yields kind of stay in this range? Yeah?
Speaker 1: And I mean I think it's more of an economic
Speaker 1: growth and what's keeping the treasury in that range? And
Speaker 1: so is it tapering as a distortion? Is it just
Speaker 1: a lot of liquidity around the globe? Um? I just
Speaker 1: think the small cap in the cycnical trade to me,
Speaker 1: is more tied to strong economic growth that I think
Speaker 1: people were worried about or peaking. UM. If anything, it's
Speaker 1: a plateau. You have companies with huge amounts of new
Speaker 1: orders hugh backlogs order UH and low inventories. You have
Speaker 1: consumers with incredibly strong balance sheets who have probably been
Speaker 1: pushed out just a bit because of what Delta has done.
Speaker 1: And so I think you continue to see economic growth
Speaker 1: that remains strong. I'm not for sure what the tenor
Speaker 1: Treasury does. I expected to have an upward biass tapering
Speaker 1: is announced, but I think all those things point to
Speaker 1: an economic cycle that lasts just a bit longer and
Speaker 1: is a bit higher for a while. UH and valuation.
Speaker 1: We think many economic cycle investors are ignoring still points
Speaker 1: to small caps and value stocks are being cheap relative
Speaker 1: to their counterparts brand. You mentioned small caps, small caps
Speaker 1: over large caps. You mentioned cheap. A lot of people
Speaker 1: would say Europe cheap in the Owned States, and we've
Speaker 1: said that for a long long time. You touched on
Speaker 1: the euro Zone and talked about the potential for our
Speaker 1: performance there. What do you like about Europe? Bren It's
Speaker 1: much more cyclically inclined, and so they set up of
Speaker 1: the index is much more cyclical in nature. Europe has
Speaker 1: been cheap for a while. It was in need of
Speaker 1: a catalyst. It actually has that now the Central Bank
Speaker 1: there has done things quite frankly, that they hadn't done
Speaker 1: in the past. Germans have even gone on a fiscal
Speaker 1: stunding spree. And so I just think that you have
Speaker 1: strong cyclical economic growth for really the first time in
Speaker 1: ten years to twelve years, and I think that's a
Speaker 1: backdrop for yours on stock Stanley being appreciated by investors. Brent.
Speaker 1: There's a column in the Telegraph by Ambrose Evans Pritcher
Speaker 1: talking about how Germany does. Those seem to be losing
Speaker 1: patients with quantitative easing, and they're starting to indicate perhaps
Speaker 1: they don't want to keep the pedal going for as
Speaker 1: long as they have for the foreseeable future. This really
Speaker 1: bleeds into the potential for taper talk tomorrow at the
Speaker 1: ECB meeting. If they were to start talkering and talking
Speaker 1: about tapering, their QUI will that change your view on Europe? Yeah,
Speaker 1: it's certainly a risk. And I think of UM, the
Speaker 1: Central Banks right now is three yards in a cloud
Speaker 1: of dust. So sorry, Jonathan, just a different football game
Speaker 1: than you're used to, UM. But they're advancing the ball
Speaker 1: slowly to try not to get any market reaction, and
Speaker 1: I think central banks around the globe, I think people
Speaker 1: need to stop focusing on their day to day operations
Speaker 1: and focus on their action function. And it's still to
Speaker 1: do more, not to do less. Certainly the years on,
Speaker 1: probably a bit less than the US, but in general,
Speaker 1: overall central banks stand at the ready and we'll continue
Speaker 1: to do so until there's a cost on either side.
Speaker 1: Right now, I know there's talking inflation, but that cost
Speaker 1: is still relatively low. Interest rates are well behaved, and
Speaker 1: they've failed on their mandate for ten years. They're going
Speaker 1: to push as hard as they can for as long
Speaker 1: as they can, as long as inflation allows them to
Speaker 1: do so. And I just think that as you move
Speaker 1: into the end of the year, inflation is going to
Speaker 1: pull back and that taper talk and everything else going
Speaker 1: to subside just a bit. Is that football with the
Speaker 1: hands they used the hands for the hands, three yards
Speaker 1: in a cloud of dust towards the goal line. Is
Speaker 1: this good? Is this a good? Tom Keane? It's an
Speaker 1: oblong round ball. Thank your French Northwestern Mutual Wealth Management
Speaker 1: chief investment strategist. I'm pleased to say that my good friend,
Speaker 1: my old buddy Bloomberg's Manners Cranny standing by in Cairo.
Speaker 1: Mannus go to hear from you, sir, and just look
Speaker 1: at that chair. If only the could see this on
Speaker 1: radio A palatial Mannas Cranny this morning, Jonathan, New York,
Speaker 1: thank you very much for the welcome. Yes, we are
Speaker 1: in the Ministry of Foreign Affairs at a very timely moment.
Speaker 1: Were joined by his Excellency Summer Chokri, the Foreign Minister
Speaker 1: for Egypt. Sir, thank you for having us into your office.
Speaker 1: Is at a grand home. It's an interesting time in
Speaker 1: our region. Biden is delivering on Trump's plan to leave Afghanistan.
Speaker 1: That is done. What does that mean for the Middle
Speaker 1: East for you? Certainly, the ongoing conflict in in Afghanistan
Speaker 1: and Iraq has burdened the region quite substantially over the years,
Speaker 1: and the departure, of course from Afghanistan has its ramifications
Speaker 1: and will be followed and deliberated upon within the context
Speaker 1: of uh the other region. Tomorrow we have a meeting
Speaker 1: of the Ministerial Arab League and that issue will will
Speaker 1: come will be a focus of discussions between the ministers. Undoubtedly,
Speaker 1: transformation of this nature and this magnitude will have interesting repercussions,
Speaker 1: and we are wait to see what those repercussions are
Speaker 1: in terms of how the the new Taliban government will operate,
Speaker 1: how it will sustain the commitments that it has made,
Speaker 1: and and how we can have a the security and
Speaker 1: the stability of the region within the newly existing situation.
Speaker 1: But do you see this as a disengagement by the
Speaker 1: Biden administration making this region more unstable? Uh? No, I
Speaker 1: don't think the United States has a superpower, as a
Speaker 1: power with both interests and very deep relationships with the
Speaker 1: countries of the Middle East, is in a position or
Speaker 1: can disengage. I think it will continue to rely on
Speaker 1: its traditional relationships and partnerships among them with Egypt strategic ally,
Speaker 1: and will continue to extract its interests and also provide
Speaker 1: the security and the stability that the region needs. My
Speaker 1: assessment as I got on the plane to come to
Speaker 1: Carl is there is a tectonic shift in discussions between
Speaker 1: the nations here in the Middle East. Would you describe
Speaker 1: that between yourselves and and Turkey, the UAE and Turkey,
Speaker 1: there is in my mind a tectonic shift. Do you agree?
Speaker 1: Not necessarily, I agree that the region is undergoing a
Speaker 1: very turbulent and volatile situation where there has been, of course,
Speaker 1: conditions that have not been readily contributing to the peace
Speaker 1: and security of the region. We have conflicts in Libya,
Speaker 1: in Yemen, in of course, the situation of terrorism and
Speaker 1: and the threats the current situation in Syria and Lebanon.
Speaker 1: These are all issues that have to be addressed, and
Speaker 1: I think it is in the best interest of the
Speaker 1: nations of the region to uh expand the communications and
Speaker 1: the understandings that can provide for the security and stability.
Speaker 1: You're a boy to enter blind too of discussions with Turkey.
Speaker 1: Egypt Turkey upgrade bilateral relationship. What does that mean? Will
Speaker 1: you store diplomatic ties at this stage? This is the
Speaker 1: second round of exploratory talks between Egypt and Turkey. This
Speaker 1: comes at the invitation of the Turkish government. We have
Speaker 1: ben eager to find a resolution and to find the
Speaker 1: necessary formula for regaining the normal relations between the two countries.
Speaker 1: But I think at this stage we still have to
Speaker 1: evaluate the the outcome of this second round of discussions
Speaker 1: and primarily the context of the bilateral relations. The bilateral
Speaker 1: relations and certain measures that were taken by Turkey need
Speaker 1: to be somehow addressed, and when we are satisfied that
Speaker 1: those issues have been resolved, that will open the door
Speaker 1: for further progress. I have a lot to get through,
Speaker 1: and time, of course, is a natural enemy. But if
Speaker 1: I say to you in a suctinct way, what do
Speaker 1: you need to see from the text to move forward
Speaker 1: to restore a by lateral relations, what would that be.
Speaker 1: We have provided Turkey with a with our assessment and
Speaker 1: our requirements. I think they very well comprehend and can
Speaker 1: fulfill all of these issues, and we hope that they
Speaker 1: do so that we can move forward on the renaissance. Damn.
Speaker 1: It's a very contentious issue, obviously, and you've tried to
Speaker 1: arbitrate with Ethiopia, and several times President CC has said
Speaker 1: all options are on the table, including military action. Sir,
Speaker 1: are you prepared to take military action against Ethiopia? The
Speaker 1: President has never indicated that he would be taking military action,
Speaker 1: But I think the terminology has always been that for
Speaker 1: any country, all options are always open, and we have
Speaker 1: committed ourselves to the negotiating process. We have endorsed the
Speaker 1: negotiations over the last ten years, and we have supported
Speaker 1: the negotiations of the African Union under the chairmanship of
Speaker 1: Presidents Acadia, and they'll continue to seek an enhanced stroll
Speaker 1: for the observers to help the parties to find a resolution.
Speaker 1: Would you do everything to avoid conflict? Definitely. I think
Speaker 1: nobody seeks conflict. We have been committed over ten years
Speaker 1: to a peaceful resolution of this issue based on international law,
Speaker 1: based on best practice, and I think we are still
Speaker 1: would seek that the political will of the Ethiopian government
Speaker 1: is demon strated by signing an agreement. Thank you very
Speaker 1: much for joining us, Foreign Minister, thank you for the
Speaker 1: welcome to the country. I hope that we come back again.
Speaker 1: Sally Schell create the Foreign Minister for agent joining me. Uh,
Speaker 1: it's been a great trip and I've got to say
Speaker 1: when it comes to when it comes to offices, sir,
Speaker 1: I think you're on a winning trade. Thank you very much.
Speaker 1: Sick joining us now is the man himself, David Rubinstein,
Speaker 1: the co founder of the Carlisle Group, but of course
Speaker 1: the host of its fantastic show, Reid Hoffman, a really
Speaker 1: important person to be talking to at this moment where
Speaker 1: we see this tech battle really heating up between the
Speaker 1: US and China. Where did he sort of throw his
Speaker 1: hat in terms of which region had the upper hand
Speaker 1: in this tussle. There's no doubt that the Silicon Valley
Speaker 1: has had the upper hand for decades. But he does
Speaker 1: think that China is now competing effectively with the United States.
Speaker 1: And you have these two polar opposite in effect, China
Speaker 1: with one system for entrepreneurial activity and Silicon Valley with another.
Speaker 1: And he thinks that China is doing what he calls
Speaker 1: blitz scaling, which means building very large companies. That's what's
Speaker 1: happened in the United States with Amazon and Apple and Netscape,
Speaker 1: very large companies that operate at scale. And he thinks
Speaker 1: that China is doing the same thing. Well, that's the
Speaker 1: bigger picture. And yet the micro picture has been an
Speaker 1: increasing crackdown on some of these behemoths, and some of
Speaker 1: the blitz creeged companies are the companies that have benefited
Speaker 1: from their approach. How does he view that, I mean,
Speaker 1: does he believe that that will foster innovation and the
Speaker 1: potentially put a damper on it by raising regulatory uncertainty. Well,
Speaker 1: clearly in China wants to make it clear that the
Speaker 1: Chinese government is the most important thing in Chinese society,
Speaker 1: and once the entrepreneurs recognized that they can go about
Speaker 1: their business. But clearly China doesn't want companies that are
Speaker 1: more powerful than the President of China or their entrepreneurs
Speaker 1: being more powerful, so they have had some kind of
Speaker 1: crackdown or or regulatory constraints. We haven't had quite the
Speaker 1: same thing in the United States. So the American entrepreneur
Speaker 1: are free to build companies without the kind of constraints
Speaker 1: and concerns that now some people have in China. Well,
Speaker 1: talking about building companies, David, it's it's Kaylee Lines in
Speaker 1: New York. Good morning to you. You mentioned their Apple, Amazon,
Speaker 1: these behemous we have seen grow here in the US.
Speaker 1: Does he believe that those companies are getting too large? Well,
Speaker 1: he doesn't say that in part because remember he is
Speaker 1: a person I think he's still on the Microsoft board.
Speaker 1: He's sold linked In, which he built to Microsoft, so
Speaker 1: he'd be difficult for him to say that Microsoft is
Speaker 1: becoming too big and too powerful, So he doesn't really
Speaker 1: say that. He does say that we now have five
Speaker 1: of these gigantic technology companies United States, and we're gonna
Speaker 1: get ten of them soon. So a company that like
Speaker 1: say Salesforce will become one of those kind of companies,
Speaker 1: or Netflix will become one of those kind of companies,
Speaker 1: which they are are big now, but they're gonna be
Speaker 1: much much bigger. So he doesn't worry because he thinks
Speaker 1: they're gonna be more and more of these gigantic companies,
Speaker 1: not fewer and fewer of them. And are those the
Speaker 1: kind of companies he's interested in getting into now or
Speaker 1: what would you favor? Well, he's a venture investor. He's
Speaker 1: at Graylock, very good venture firm. He's an entrepreneur who
Speaker 1: built linked In and helped to build PayPal, but he's
Speaker 1: also a venture investor. He was an early investor in Facebook,
Speaker 1: an early investor in Airbnb. So he likes to find
Speaker 1: young entrepreneurs who are really talented, have a good idea,
Speaker 1: and back them. So he's an unusual mix of being
Speaker 1: an entrepreneur and a venture investor and a very successful
Speaker 1: angel investor as well. David yourself also being a pretty
Speaker 1: big investor in companies at the earlier stages. There is
Speaker 1: a question of what the structure of such dominant tech
Speaker 1: behemoths at the top does for innovation for some of
Speaker 1: the smaller companies. In other words, how much of a
Speaker 1: competitive competitive advantage can they have and how much UH
Speaker 1: can they get with respect to data, which reigns supreme.
Speaker 1: There's no doubt that the large technology companies now have
Speaker 1: a lot of data and they're using it, they would say,
Speaker 1: for their purposes, their corporate purposes. But there's always going
Speaker 1: to be entrepreneurs, always somebody with a new idea, somebody
Speaker 1: that is very creative. And he likes to back people
Speaker 1: who he thinks have a vision of where they to
Speaker 1: go and have the capability of getting there. And it's
Speaker 1: a different skill set than being an entrepreneur, where you
Speaker 1: have to have the vision yourself and build a company.
Speaker 1: But reen Hoffman is a very talented individual, and when
Speaker 1: he's in the room, it's pretty clear he's always the
Speaker 1: smartest person in the room. But he doesn't tell people that,
Speaker 1: and so he has a certain modesty that I think
Speaker 1: reflects the fact that he's very secure in who he
Speaker 1: is and he's very well respected by his colleagues. Lots
Speaker 1: of times you have very bright people and behind their back,
Speaker 1: people are snickering about them because their egos too big,
Speaker 1: or they're not as talented as they think. That's not
Speaker 1: the case with Reid David. I want to bring the
Speaker 1: conversation back to where we started, and that is China.
Speaker 1: We've heard a chorus of large name investors over recent
Speaker 1: weeks kind of weighing in on the debate and whether
Speaker 1: or not you can invest there. You have George Soros
Speaker 1: on one side saying that would be a tragic mistake.
Speaker 1: You have Black Rock and Ray Dalio on the other.
Speaker 1: I'm just wondering what your take is on China given
Speaker 1: the crackdown that we are seeing. I think George Soros
Speaker 1: this point had to deal with geopolitical issues and government
Speaker 1: constraint issues and things that are different than whether China
Speaker 1: is going to old companies that if you invest in
Speaker 1: them you'll do well. As a general rule of thumb,
Speaker 1: I do think investing in China will produce very good profits.
Speaker 1: You have to get comfortable with some of the constraints
Speaker 1: who have in China, but there's no doubt there constraints
Speaker 1: in lots of countries as well. So I wouldn't say
Speaker 1: that China is not a good place to invest. I
Speaker 1: think it's a very good place to invest, but there
Speaker 1: are some challenges you have to get comfortable with. And
Speaker 1: you have to get comfortable that some of the governmental
Speaker 1: actions are not gonna be ones you might be comfortable
Speaker 1: with if they were happening in this country. For example,
Speaker 1: as you shift focused at all with respect to your
Speaker 1: your your appreciation of China investments, even with Jijimping's recent
Speaker 1: pronouncements around the common good, well right now, you have
Speaker 1: to remember China has one point three billion people and
Speaker 1: it's going to be a gigantic market for some time.
Speaker 1: But the Chinese governmental system is different than Americans, and
Speaker 1: you have to get comfortable with that. And so if
Speaker 1: you're not comfortable with that, then you can invest in
Speaker 1: many other places. But if you're comfortable with the fact
Speaker 1: that China is going to have a heavy regulatory hand
Speaker 1: in things, you can you can get comfortable with investing there.
Speaker 1: We have invested there, I have invested there. I'm not
Speaker 1: pulling out of China. I think it's actually a very
Speaker 1: good place to invest. But every country has its challenges.
Speaker 1: The United States has challenges too. You can't argue that
Speaker 1: we have all the kind of governmental actions that everybody
Speaker 1: has come from with here either. David Rubinstein, you make
Speaker 1: a very valid point. Nobody would disagree David Rubinstein, host
Speaker 1: of Perit Peer Conversations on Bloomberg Television Television, a co
Speaker 1: founder of the Carlisle Group. Don't miss that at nine
Speaker 1: pm tonight, Reid Hoffman, an entrepreneur who helped co found
Speaker 1: linked In, speaking about the landscape for technology at a
Speaker 1: time when it really is pre eminent. This is the
Speaker 1: Bloomberg Surveillance Podcast. Thanks for listening. Join us live weekdays
Speaker 1: from seven to ten am Eastern on Bloomberg Radio and
Speaker 1: on Bloomberg Television each day from six to nine am
Speaker 1: for insight from the best and economics, finance, investment, and
Speaker 1: international relations. And subscribe to the Surveillance podcast on Apple podcast, SoundCloud,
Speaker 1: Bloomberg dot com, and of course, on the UR. I'm
Speaker 1: Tom keene In. This is Bloomer