Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Jason Kelly. We're here every day bringing you the latest
Speaker 1: news from the world's of business and finance, plus technology, politics, economics,
Speaker 1: all harnessing the power of Bloomberg Business Week reporters and editors,
Speaker 1: not to mention our hundred journalists and analysts more than
Speaker 1: a hundred and twenty countries. You can download Bloomberg Business
Speaker 1: Week on iTunes, SoundCloud, or Bloomberg dot Com. You can
Speaker 1: also listen to our radio show weekdays at two pm
Speaker 1: Eastern only on Bloomberg Radio Well Testing Tracing. They are
Speaker 1: at the core of everything that happens going forward. We
Speaker 1: hear about it from the President, we hear about it
Speaker 1: from experts on the Coronavirus Task Force, from governors, from mayors, etcetera.
Speaker 1: Let's talk to someone who is working on this on
Speaker 1: the front lines on a national level. Anita Cicero is
Speaker 1: deputy director of Johns Hopkins Center for Health Security. It's
Speaker 1: part of the Johns Hopkins University Bloomberg School of Public Health.
Speaker 1: As you might tell by the name, the Bloomberg School
Speaker 1: of Public Health is supported by Mike Bloomberg. He's the
Speaker 1: founder of Bloomberg LP, Bloomberg Philanthropy's parent company of this
Speaker 1: radio station. Anita, So good to talk to you. Good
Speaker 1: to be here, Jason. So what you're doing, as I said,
Speaker 1: is just really at the crux of all of this.
Speaker 1: This is going to determine what happens next. Where are
Speaker 1: we when it comes to really rolling out a plan
Speaker 1: to find cases and to trace folks, Well, we we
Speaker 1: do need a national plan for that, and so far
Speaker 1: UM there has not been one. UM CDC has provided
Speaker 1: some useful guidance, and UM talked about the role of
Speaker 1: contact tracing and fighting the pandemics. But we developed our
Speaker 1: own report on testing and contact tracing because we really
Speaker 1: feel that that is the thing that's going to make
Speaker 1: the difference UM in this outbreak. And for contact tracing,
Speaker 1: it just involves finding out who an infected person came
Speaker 1: in contact with, so that those individuals to be alerted
Speaker 1: and UM and also quarantined in order to monitor their
Speaker 1: health and to make sure that they don't continue spreading
Speaker 1: the virus UM in public. UM. So this is critically
Speaker 1: important at this juncture, especially if we're going to be
Speaker 1: lifting social distancing. I gotta say I need to Every
Speaker 1: morning I wake up, I throw on Google and I say,
Speaker 1: you know, give me the top news headlines and I
Speaker 1: hear about what's going on around the country. In terms
Speaker 1: of starting these efforts UM to get control of the virus.
Speaker 1: Tell me how a testing and tracing system will work,
Speaker 1: what's the money needed to implement it, what are the
Speaker 1: people needed to implement it, and what does someone like
Speaker 1: me at home or Jason at holm, what do we
Speaker 1: need to know about it? And what will we ultimately
Speaker 1: need to do to make this work? All very good questions.
Speaker 1: So UM UH contact tracing is something that's it's really
Speaker 1: a traditional, old, tried and true method of being able
Speaker 1: to trace UH the spread of infection and to control
Speaker 1: the infections so that it's not spread further. And public
Speaker 1: health agencies across the US have been doing this for years.
Speaker 1: They do it UM to track these those cases tuberculosis
Speaker 1: UM sexually transmitted infections. So this is something that our
Speaker 1: state and local public health agencies know how to do UM.
Speaker 1: Now that being said, they are understaffed and underfunded. I
Speaker 1: think public health budgets UM in the past fifteen years
Speaker 1: have been cut by UM. Most public health agencies in
Speaker 1: the United States before COVID did not have UM staff
Speaker 1: that were dedicated full time to contact tracing. This is
Speaker 1: one of the many, many things that public health does
Speaker 1: UM in the course of their their jobs. And so
Speaker 1: what what is really needed is to have funding that
Speaker 1: will go to the state, the state UM public health
Speaker 1: departments and local public health departments so that they can
Speaker 1: do a cup things UM. One is really to hire
Speaker 1: a significant number of of workers UM or use volunteers
Speaker 1: and train them so that they can assist with contact
Speaker 1: tracing methods and also UM to to maybe make use
Speaker 1: of some new technologies that may be coming online soon
Speaker 1: that can assist with contact tracing UM. And in terms
Speaker 1: of what is is UM, what's important to know about
Speaker 1: this is that you know, we are all very you know,
Speaker 1: it's desperate to get back to life as maybe not
Speaker 1: completely normal, but more normal than we are living through
Speaker 1: right now with these strict social distancing requirements. And the
Speaker 1: key to being able to circulate again in public is
Speaker 1: for the United States to know where all of its
Speaker 1: COVID cases are UM, so to to use the testing
Speaker 1: to order in order to identify all those cases and
Speaker 1: then also be able to contact people who could have
Speaker 1: been exposed to a confirmed case to make sure that
Speaker 1: they're quarantined for fourteen days and stay out of circulation. UM.
Speaker 1: Once we're able to do that, then and we we
Speaker 1: know more or less where the cases are than others
Speaker 1: who are not infected and who weren't exposed, UM will
Speaker 1: be more able to go to work and and UM
Speaker 1: and go to more you know, shops and and you know. Again,
Speaker 1: it will be a while before things are completely back
Speaker 1: to normal, but at least that it would allow social
Speaker 1: distancing measures to be relaxed. So it is really important
Speaker 1: UM in order to try to get this right. So
Speaker 1: Anita and we're going to continue our conversation just a
Speaker 1: few minutes, but in about a minute, tell us, I
Speaker 1: mean collaboration and coordination seems really important. How confident are
Speaker 1: you that we can do this between the federal and
Speaker 1: eight and local levels. Well, again, we need funding. I
Speaker 1: really have a lot of confidence in UM, state and
Speaker 1: local public health officials to be able to have given
Speaker 1: the resources to be able to manage UM these programs
Speaker 1: and UM we can talk more about it. But the
Speaker 1: training that's required it's not that extensive or that complicated.
Speaker 1: So this is something that can be done. It's not
Speaker 1: a moonshot, it's just the unesting it needs to be
Speaker 1: there to hire the workforce. Still with us as a
Speaker 1: need assist or a deputy director of Johns Hopkins Center
Speaker 1: for Health Security, Johns Hopkins University, Bloomberg School of Public
Speaker 1: Health joining us from Washington, d C. I need one
Speaker 1: thing I did want to get from you, because you
Speaker 1: folks at Johns Hopkins have just been incredible in terms
Speaker 1: of keeping track of the virus and really giving a
Speaker 1: good indication and perspective on where we are, where we're going,
Speaker 1: where we need to be going, based on you know,
Speaker 1: the actions of everybody around the country. You also, you're
Speaker 1: a lawyer, You've worked in Washington. You unders and pharmaceuticals,
Speaker 1: the regulatory framework, UM, the policy framework. Uh, what do
Speaker 1: you think is realistic in terms of us actually getting
Speaker 1: a vaccine that can tackle this virus? Well, I that's
Speaker 1: the you know, million dollar question right there. UM. And
Speaker 1: the good news is that I think governments, UM, and
Speaker 1: international organizations and industry are all focused on that goal
Speaker 1: UM and working very hard, UM contributing a lot of
Speaker 1: funding for that UM. I think that in in our country,
Speaker 1: um F d A has shown some flexibility in terms
Speaker 1: of regulatory issues surrounding UM development of vaccine UM. But
Speaker 1: the you know, the fact is that it's really critical
Speaker 1: to have randomized controlled trials to prove um the f
Speaker 1: can see and and also you know safety of vaccines
Speaker 1: that come online, and to do that well, UM, it
Speaker 1: does take some time. So I think it's gonna require
Speaker 1: some patients. I I'm optimistic that we will get there ultimately,
Speaker 1: but it's um, it's unlikely to be right around the corner.
Speaker 1: But this year or next year. I would not um
Speaker 1: place my bets that will happen this year, Okay, but
Speaker 1: you know, one can hope right right well, and and
Speaker 1: certainly you know, some of the treatment on the treatment side,
Speaker 1: of the therapeutic side obviously, So I'm not great news today,
Speaker 1: uh from Gilead. You know. Meanwhile, closer to home here
Speaker 1: in New York, you know, we got some data that
Speaker 1: was it feels like at least as being interpreted as
Speaker 1: somewhat positive in the sense of the spread and the
Speaker 1: number of people who have developed antibodies here Anita, what
Speaker 1: does that tell us and how does that figure into
Speaker 1: this tracing project that you're working on. Naturally, when you
Speaker 1: see figures like that coming out of New York and
Speaker 1: New York City, especially where you know upwards of people
Speaker 1: you know have been exposer actually have had the virus
Speaker 1: and now have the antibodies. Help us understand how this
Speaker 1: all fits together well. The testing and contact tracing in
Speaker 1: addition to UM antibody testing which is called strology testing,
Speaker 1: are all part of a disease surveillance system and they
Speaker 1: would all have a role to play. UM. I think
Speaker 1: there's a lot of hope that eventually there'll be enough
Speaker 1: cases in you know, particular population to say, oh, now
Speaker 1: we have herd immunity lenning enough people have been exposed
Speaker 1: that UM, they're less likely to continue to be infected UM.
Speaker 1: But even though there are some encouraging signs for different
Speaker 1: places based on strology testing, UM, we there's no community
Speaker 1: that is close to herd immunity UM. I think that
Speaker 1: in terms of the antibody tests to UM, because there
Speaker 1: were some relaxed regulatory requirements UM and to try to
Speaker 1: get tests out as soon as possible. UM. There's UM.
Speaker 1: It's sort of a mixed bag now. So some have
Speaker 1: shown to have some you know, sensitivity UM issues and
Speaker 1: and and problems and UM. And so I think that
Speaker 1: FDA is sort of braining that back in a bit
Speaker 1: and making sure that strology testing that is available is
Speaker 1: you know, known to be reliable to determine the antibodies
Speaker 1: and and then more work needs to be done really
Speaker 1: to confirm that the presence of antibodies UM confers immunity
Speaker 1: for people. And how long that immunity? Laughs, Hey, one
Speaker 1: thing we wanted to ask you just got thirty seconds
Speaker 1: here the hardest hit area, New York. They're finding that
Speaker 1: over the people tested positive for a blood marker that
Speaker 1: they had been infected at some point with the virus.
Speaker 1: Just again about twenty five seconds. What what's important about
Speaker 1: that that we need to know just quickly. Well, it
Speaker 1: could be that those those people therefore have the anti
Speaker 1: bodies and would not be UM reinfected with COVID anytime,
Speaker 1: you know, for months at least UM. But also potentially
Speaker 1: they could participate and donate UM plasma for UM other
Speaker 1: patients UM who needed in order to help build their
Speaker 1: anti bodies up to protect against the disease. All right,
Speaker 1: all right, we really appreciate it, Thank you so much.
Speaker 1: Great contacts. Anitasis Row Deputy director of John's Hopkins Center
Speaker 1: for Health Security at the Bloomberg School of Public Health,
Speaker 1: obviously the Bloomberg School of Public Health supported by Mike Bloomberg,
Speaker 1: founder of Bloomberg LP. You are listening to bloom Burg
Speaker 1: Business Week, and you know, Carol, when we map out
Speaker 1: our show, there are some moments that I look forward
Speaker 1: to just as a way to sit back, sort of
Speaker 1: rest into the show and just talk to a really
Speaker 1: smart person. And I know this is that moment. Joanas Sarah.
Speaker 1: I love Joe No Sarah, one of my favorite folks,
Speaker 1: been reading his stuff for years and now listening to
Speaker 1: the dulcin sound of his voice. So we're buttering you
Speaker 1: up because we really I'm telling you, I really like you.
Speaker 1: Guys just want to you guys, just want to take
Speaker 1: a rest and let me talk. We would do that. Um,
Speaker 1: I was gonna I was gonna pump up your podcast
Speaker 1: a little bit. The Shrink next door. It's perfect quarantine
Speaker 1: listening if you if you're like one of the three
Speaker 1: people in America hasn't already listened to it. But um,
Speaker 1: we find you in Southampton, safe and sound, I hope.
Speaker 1: And also what's it like out there? Can we ask
Speaker 1: you what's it like out there. Well, let me just
Speaker 1: put it this way. One maintenance is an essential sentual activity.
Speaker 1: You're working in the art a lot. No. No, what
Speaker 1: I'm saying is people are people are the workers, the
Speaker 1: law business are are just going crazy out here. It's
Speaker 1: like it's kind of unbelievable, really, um, I mean, and
Speaker 1: then most of the ways were like everybody else, everybody's
Speaker 1: wearing a mask. You can't go into certain stores. There's
Speaker 1: a ton of takeout because, um, you know, there's somebody.
Speaker 1: New Yorkers are together are so used to take out
Speaker 1: that that all the restaurants are actually doing a pretty
Speaker 1: good business. Um uh with take our pizza, take our pasta,
Speaker 1: take out, steaks, take out every day. Um. But you
Speaker 1: know it's it's it's quiet. It's it's definitely quiet. All right.
Speaker 1: So what are the reasons we wanted to talk to
Speaker 1: you today? Just and again, we we love talking to
Speaker 1: you anytime. But I mean, you've had some some pretty provocative,
Speaker 1: as you tend to columns, sort of taking stock of
Speaker 1: where we are at this moment, especially when it comes
Speaker 1: to the rescue that is underway. From the corporate side.
Speaker 1: You've written a number of books about this. You understand
Speaker 1: the financial system really well and in the corporate world,
Speaker 1: what do you make of it so far? Because you
Speaker 1: you've been a critic, I think it's fair to say
Speaker 1: of how this is going well. I mean, the first
Speaker 1: thing is the right way to do this, honestly, is
Speaker 1: to put money in hands of the people, other than
Speaker 1: trying to run it through a bank, uh and a business.
Speaker 1: It's it's that's a crazy way to do it. And
Speaker 1: you know, they're always in this. They're in this situation
Speaker 1: now where they're just going to keep shoveling money to banks,
Speaker 1: they're gonna keep shuggling to businesses. And it's been a
Speaker 1: first It's first come for sure. So you know people
Speaker 1: are saying, well, the big companies got it first, and
Speaker 1: that's how I'm there. The big companies are organized, they
Speaker 1: know how to do this, they know how to get
Speaker 1: in the door. The little guy, the corner pizza joint,
Speaker 1: he needs help, and um, they're not going to get
Speaker 1: that help for the federal government. So you know, I
Speaker 1: just think that proceeding the way we are is the
Speaker 1: wrong way to proceed. Let me just say one other
Speaker 1: quick thing. I'm so tired of being jealous of Germany.
Speaker 1: But they've done this so right. They've given every citizen
Speaker 1: a stipend for a four or five months, and that's
Speaker 1: the way they're they're keeping their economy and their their
Speaker 1: country going. What do you think there's any appetite to
Speaker 1: do that here? Or is is the horse out of
Speaker 1: the barn? Now the horse is out of the barn,
Speaker 1: and it's it's just something that UM America is you know,
Speaker 1: idiologically America had a hard time with that, at least
Speaker 1: on the right, especially on the right, and UM, I
Speaker 1: just don't think we're going to go that way, even
Speaker 1: though it's obviously the most sensible way to do this. Yeah,
Speaker 1: but how do we break the system general? I mean,
Speaker 1: it's the big companies that listen or that you know
Speaker 1: that lawmakers listen to. I mean, they're the ones that
Speaker 1: have you know, the path direct path to Washington. Well,
Speaker 1: you know, I don't blame this on the big companies.
Speaker 1: I mean the big companies first of all, the ib ms,
Speaker 1: the zeroctors, the h t s, they're they're gonna be fine,
Speaker 1: They're gonna survive, They've got money in the bank. They're
Speaker 1: they're all trying to keep their employees uh on the
Speaker 1: payroll as much as they can. Um Uh. It's the
Speaker 1: it's the the issue really is the small the small businesses,
Speaker 1: the corner scores. You know. I'm terrified that when we
Speaker 1: come out of this, you know, of the small businesses
Speaker 1: in America are going to be gone. And that's that's
Speaker 1: the tragedy to be worried about. So Joe shifting gears
Speaker 1: a little bit, maybe dramatically. I want to talk a
Speaker 1: little bit about sports, because it's something you've written a
Speaker 1: lot about, uh and specifically the n C Double A.
Speaker 1: What does the notion of for and it feels more
Speaker 1: and more likely that we will not have certainly the
Speaker 1: a measure of college sports and college football and everything
Speaker 1: else that we're used to uh come this fall. What
Speaker 1: are the implications of that for the business of sports
Speaker 1: and for the business of the n C Double A.
Speaker 1: And this model that you and others have essentially said
Speaker 1: is speaking of fundamentally broken, fundamentally broken, right, Um, I
Speaker 1: don't think there's going to be college football this year.
Speaker 1: Um Uh. The athletic directors, you know, they got on
Speaker 1: the phone with Pence a couple of weeks ago. He
Speaker 1: wanted to talk to them, and they basically said, look,
Speaker 1: if we don't have students on campus, we're not going
Speaker 1: to have football, period, end of story, no matter, but
Speaker 1: you want may want it. The the financial implications of
Speaker 1: that are huge. Football is by far the uh you know,
Speaker 1: it's a two or three billion dollar enterprise, and then
Speaker 1: basketball is a billion dollar enterprise for the nayah, that's
Speaker 1: where they get most of their money. And if you
Speaker 1: can't televise college football, um, it's gonna be deatist aiding
Speaker 1: to the to the world of college football. And uh,
Speaker 1: I I think it's just I think it could wind
Speaker 1: up meaning that there's a ratcheting, huge ratcheting back of
Speaker 1: what football is, what it means, what it will do
Speaker 1: for the society. I I think it will be much
Speaker 1: much harder for coaches just to um justify a million
Speaker 1: dollars a year and sorry, and it's gonna also mean
Speaker 1: and this is the first tragic part. Nobody's going to
Speaker 1: drop their football team. But they're already starting to drop.
Speaker 1: You know, some some tennis teams, lacrosse teams, um universities
Speaker 1: have petitioned the n c a A to be able
Speaker 1: to go below fourteen sports, which is the n c
Speaker 1: A a minimum. And I think you're gonna come out
Speaker 1: of this with a lot of a lot of schools
Speaker 1: having five or six sports only, which will be pretty devastating,
Speaker 1: you know, because the real student athletes, the one to
Speaker 1: play lacrosse, the ones who are never gonna be pro
Speaker 1: and anything, they're the ones who are gonna get shafted.
Speaker 1: Can I get word on the radio? Yeah, you just did.
Speaker 1: It's done. It's out there in the Yeah. I do wonder. Yeah,
Speaker 1: just that whole the whole um higher education world. What's
Speaker 1: going to happen? I just had a story too about
Speaker 1: you know, college is getting ready for students to ask
Speaker 1: for more financial aid because their parents are going to
Speaker 1: be out of work. I mean, it's just totally upended,
Speaker 1: right yeah. Yeah, And and the students, students are already
Speaker 1: upset because the universities won't have refunds even though even
Speaker 1: though they're stuck with online classes, they've given refunds for
Speaker 1: room and board, but not for tuition. And there's a
Speaker 1: big you know, look, if you're a senior, I mean,
Speaker 1: and you're you've gotten in some place next year, wouldn't
Speaker 1: you be aren't you gonna want to take up a
Speaker 1: gap year just because you're just going to be the first. Yes, totally,
Speaker 1: totally finances. I think the finances of college education could
Speaker 1: finally implode um and and and many would say that
Speaker 1: that time has come. All right, Jonah Sarah, you're the
Speaker 1: best Bloomberg Opinion calumnists. Noted author calumness I do I
Speaker 1: do to host at the shrink next door? You really
Speaker 1: should check that out. It's going to be a movie soon.
Speaker 1: Will Ferrell, Paul Road, come on, it's gonna who's gonna
Speaker 1: miss that? This is Bloomberg Business Week with Carol Messer
Speaker 1: and Jason Kelly on Bloomberg Radio. You know, when we
Speaker 1: were talking earlier to Joe No Sarah, we talked about
Speaker 1: the n C Double A and obviously sports are a
Speaker 1: part of the college experience, but only a part um,
Speaker 1: even though for many of us it's the most important part.
Speaker 1: But we won't get into that. But colleges, it's been
Speaker 1: front of mind what colleges and universities are going to
Speaker 1: do and what they're doing even in the meantime when
Speaker 1: it comes to a Let's get into that and much
Speaker 1: more with Janet Lawrence. She follows all things education for
Speaker 1: us We love catching up with her. Got to start
Speaker 1: with Harvard, Janet, what a week for them? Huh, yes,
Speaker 1: what a week? Well, and if you look at the
Speaker 1: formula they the Education Department came up with formula sent
Speaker 1: percent of it was based on you know that the
Speaker 1: Bravo income students. The other share was based on the
Speaker 1: total number is one of the largest universities. And that's
Speaker 1: what they were. That's what they were allotted. And as
Speaker 1: you saw, the President criticized them, and they decided yesterday
Speaker 1: UM to say they're not going to accept the money.
Speaker 1: And all of their wealthy peers has done the same, Um, Yale, Princeton, Stanford,
Speaker 1: They've all said the same thing, that they're not going
Speaker 1: to take the money. Which I gotta say, you know,
Speaker 1: we talked about this, Jason, I talked about this on
Speaker 1: air and I said, well, you know this is they
Speaker 1: didn't do anything wrong. This is the government program allowsing
Speaker 1: this money. And man, people on Twitter came back and said,
Speaker 1: you know, don't give Harvard a pass by saying the
Speaker 1: government decided to send them the money, they need to
Speaker 1: return it. I mean, it's considering that it's Harvard and
Speaker 1: they actually didn't They actually didn't receive it. They they
Speaker 1: were told this would be their allocation. Okay, but they
Speaker 1: could have they couldn't. Yes, absolutely, the money was effectively
Speaker 1: on the way. So what does it tell us, I guess,
Speaker 1: Janet more broadly about what schools more broadly need, beyond
Speaker 1: the Harvards, beyond the I v S and the Stanfords
Speaker 1: of the world, because this is I think it's fair
Speaker 1: to say, a time of crisis in higher education on
Speaker 1: many fronts. Yes, absolutely, And we don't know who's showing
Speaker 1: up in the fall. We don't know if the freshman
Speaker 1: classes are going to be anywhere near where they need
Speaker 1: to be to get the schools enough revenue to operate.
Speaker 1: We don't know if the sophomore class is going to
Speaker 1: be much smaller. We do know that the school the
Speaker 1: students are going to be a lot meatier. So whatever
Speaker 1: financially budgets they had previously, uh, it's going to be
Speaker 1: very likely a lot bigger, and the schools will try
Speaker 1: to accommodate that. But with fewer students, um they cancel
Speaker 1: with a lot of their summer programs that give them
Speaker 1: a really nice cushion of revenue they get every year,
Speaker 1: and that money is just gone because they can't have
Speaker 1: kids on campus. And they made you know, there was
Speaker 1: a significant revenue generator having you know, thousands of high
Speaker 1: school students coming to your campuses and selling the dorms,
Speaker 1: having weddings, having band camps, hosting high school graduations, you
Speaker 1: name it. That money's all gone now. Well, and I guess, Janet,
Speaker 1: one of the things I keep coming back to is
Speaker 1: this notion that most people would agree, especially people who
Speaker 1: have to write the checks to send their kids to
Speaker 1: college and the kids themselves going to college who have
Speaker 1: some financial stake in the game, that college is extraordinarily expensive.
Speaker 1: I don't think anybody would disagree with that. And yet
Speaker 1: on the other side, you have a lot of colleges
Speaker 1: and universities essentially saying, without the revenue that we are
Speaker 1: counting on, just as you very well described, we will
Speaker 1: go broke. What's the disconnect there and how does it change? Well? Uh,
Speaker 1: parents are paying a lot of money for intimate experiences
Speaker 1: with professors, small seminars, interactions with kids, you know, leadership
Speaker 1: in club and if they're not getting that, why why
Speaker 1: would they pay seventy thousand dollars or whatever they're paying?
Speaker 1: And Uh, you know, I think you're gonna see a
Speaker 1: lot of kids not want to go in the fall,
Speaker 1: and uh justified be so uh why would anyone want
Speaker 1: to start college online when they're paying the full price? Um?
Speaker 1: So the question is we we don't know what's going
Speaker 1: to happen, and the traditional date of acceptances may first.
Speaker 1: A lot of colleges have moved back to Juniverse and
Speaker 1: even July one, so we won't get a better sense
Speaker 1: for quite a bit. But we do know that that
Speaker 1: revenue that's expected to come in is likely not going
Speaker 1: to be I have to say, and it was something
Speaker 1: jonas Sarah mentioned, but I really thought about this. I
Speaker 1: have a niece who is supposed to start college in
Speaker 1: the fall. Um. But this whole idea of a gap year, like,
Speaker 1: why wouldn't you? And I know that's a hard thing
Speaker 1: to consider, But if you know it's going to be
Speaker 1: kind of a weird year and you just don't know
Speaker 1: what it's going to be like, certainly in the fall,
Speaker 1: and who knows what it means, you know, carrying over
Speaker 1: into the new year. You know, I do wonder if
Speaker 1: that will pick up some momentum. Janet, Well, it doesn't
Speaker 1: necessarily have to be a formal gap year program. You
Speaker 1: could you could try to get a job, or you
Speaker 1: could follow here, or you could spend time with your
Speaker 1: grandparents and and differ for a year. And you know,
Speaker 1: you're not really losing anything. So I wouldn't be surprised
Speaker 1: if we see a lot of kids make that decision. Yeah,
Speaker 1: it's interesting, and we know you're going to continue to
Speaker 1: follow this story, Janet, because I feel like the fallout
Speaker 1: to some extent is just beginning, you know, especially when
Speaker 1: you think about them. And I've been talking to some
Speaker 1: folks who work at smaller colleges and universities and they're
Speaker 1: just saying that, you know that this is an existential
Speaker 1: crisis in many ways, all Right, Janet, Lauren always loved
Speaker 1: catching up with her following all things education, higher education, endowments,
Speaker 1: and you know, starting with the Harvard story this week,
Speaker 1: which obviously caught a lot of headlines and Carol, as
Speaker 1: you say, just blew up on Twitter. You know, it
Speaker 1: was like made for social media sort of moments, obviously
Speaker 1: propelled by the President in his daily press conference, and
Speaker 1: that was when it really caught fire. But you know,
Speaker 1: Harvard is a sort of almost like third rail word
Speaker 1: in some cases right something. You know, a university system
Speaker 1: that's got incredibly deep pockets and alumni who will make
Speaker 1: sure that the money continues flowing. Uh So it's kind
Speaker 1: of interesting. I was thinking about how we talked with
Speaker 1: Mike that there's not great models for the economy right
Speaker 1: now because we've never seen these kind of statistics. And
Speaker 1: I felt, even for universities, the financial crisis isn't the
Speaker 1: same even though they saw cutbacks. This is just a
Speaker 1: whole different ball game, it is. Uh. There was a
Speaker 1: funny story about how the most off word used by
Speaker 1: CEOs these days, unprecedented, makes sense. Use unprecedented journal now.
Speaker 1: But you let me drive. Oh no, enough home, honey, please,
Speaker 1: I'll do the right drivel let me. I want to drive,
Speaker 1: Just drive by the question trying. This is the drive
Speaker 1: to the Globe Commune. Thanks, we'll try us down on
Speaker 1: Bloomberg Radio. All right, just got about ten minutes left
Speaker 1: to in today's trading session. We've been bouncing around right now.
Speaker 1: We're just off our loads of the session, still a
Speaker 1: little bit higher on those major equity averages, but definitely
Speaker 1: way off our highs of the session. Let's get into
Speaker 1: it with Jack McIntyre. He's Global fixed income portfolio manager
Speaker 1: a Brandywine Global Investment Management. He joins us on the
Speaker 1: phone from Philadelphia, Jack, Nice to have you here. UM,
Speaker 1: talk to us a little bit about your world and
Speaker 1: investing right now. So all right, think global, you know
Speaker 1: that opens invest anywhere in the world. You know, we UM,
Speaker 1: we've got a kind of a barbelled portfolio. So one
Speaker 1: of the things that we've been doing, the biggest change
Speaker 1: is we've been increasing our investment great corporate bond exposure.
Speaker 1: And the reason being is that you know, we're not
Speaker 1: just we you know, we're not fighting the FED. We're
Speaker 1: joining the FED. You know, we we're taking what they're
Speaker 1: giving us. UM. You know, we're doing some very high
Speaker 1: quality names. But you know, we've raised some dollars UM,
Speaker 1: but we still have some Miam exposure. And and that's
Speaker 1: been this the part of the portfolio that certainly is underperformed. UM.
Speaker 1: I think from evaluation standpoint, it's it's compelling, but again
Speaker 1: there's a lot of uncertainty coming out of this UM,
Speaker 1: you know, and that's probably what the markets are kind
Speaker 1: of wrestling with now. It's not necessarily that's the flattening
Speaker 1: of the infashion curst. But what's the world's gonna look
Speaker 1: like coming out of this? And this is where we
Speaker 1: kind of all have to sort of guests a little
Speaker 1: bit how we think it's going to play out. Well, Jack,
Speaker 1: that's a that's a really interesting point because I mean
Speaker 1: this is a to go back to what you said,
Speaker 1: this is a global pandemic and has played out very
Speaker 1: unevenly around the world, and I think there's a lot
Speaker 1: of discussion out there as to what this actually looks
Speaker 1: like when maybe it hits in a more meaningful way,
Speaker 1: especially in some of those emerging markets. We had a
Speaker 1: guest on I believe it was earlier this week, you know,
Speaker 1: talking about how they're very very few cases in Africa,
Speaker 1: for instance, right now. Maybe that will remain, but you know,
Speaker 1: we've seen a huge surge, I believe in in India.
Speaker 1: So what does it take and how do you do
Speaker 1: the work to to kind of synthesize the medical side
Speaker 1: and the investment side. So you're not it's a great question,
Speaker 1: and you know, to be honest, I mean there's no
Speaker 1: set answer. You know. What we have to do is
Speaker 1: kind of go back and look at you know, everything
Speaker 1: from you know, the demographics. Uh and yeah, you know
Speaker 1: obviously not obviously, but a lot of countries have younger
Speaker 1: uh parts of the population. Well, and it looks like
Speaker 1: they're better position to come out of this. You know,
Speaker 1: some countries they've kind of gone through their versions of pandemics.
Speaker 1: Maybe their immune systems are earned better shape. But you
Speaker 1: don't know. I mean, it's and we obviously know, you know,
Speaker 1: they don't have the fiscal resources to do what we're
Speaker 1: doing in the developed world. We know the healthcare systems
Speaker 1: are under investing all that kind of stuff. Um, you know,
Speaker 1: I kind of use that because, hey, the market knows that,
Speaker 1: you know, and and if the market knows that, isn't
Speaker 1: that arty sort of discounting in price. I mean, I
Speaker 1: get to hear anybody say, you know, come out being
Speaker 1: very positive on the EPP, And I'm not saying I
Speaker 1: don't want the listeners to go out and pile into
Speaker 1: em because that there is risk doing that. It's part
Speaker 1: of our portfolio, it's not an entire portfolio. I think
Speaker 1: if the way we're thinking about investing in this world
Speaker 1: is that, hey, if I'm gonna put something that's gonna
Speaker 1: do well in a risk on environment, well I need
Speaker 1: to add something that's gonna do well in a risk
Speaker 1: of environment, because nobody's got the kind of conviction. I
Speaker 1: would just kind of bring out the point that, you know,
Speaker 1: we do maybe have some type of model, you know,
Speaker 1: looking at the China, I mean, you know, maybe they
Speaker 1: weren't transparent, uh in the beginning, but they're coming out
Speaker 1: of this and I think it's a framework that might
Speaker 1: work in the US. Is that as they bring their
Speaker 1: comedy back online, people are going back to work, but
Speaker 1: they're slower to go into the leisure parts of their
Speaker 1: and their daily activity. So I think that's going to
Speaker 1: be the model that we're going to follow in the US.
Speaker 1: So what kind of you know, so you're playing into
Speaker 1: sovereign dett right around the world, and I do wonder
Speaker 1: we do know global central banks, Man, they'll do what
Speaker 1: they need to to make sure they prop up their
Speaker 1: economies right now, right so it's coming from all of
Speaker 1: the central bankers are the majority of them around the globe.
Speaker 1: What are the bets you want to make? What are
Speaker 1: the bets that you feel most confident? Um, because I
Speaker 1: look at your portfolio, which you guys have actually done
Speaker 1: pretty pretty well in the last UM one year or so,
Speaker 1: I think up nine percent, putting you in the percentile.
Speaker 1: But it's not been an easy market, you know, longer
Speaker 1: term um for you. So what's what's the bets that
Speaker 1: you feel that you can make with confidence right now? So, yeah,
Speaker 1: you're right, and it's been it's been a rough march
Speaker 1: for us. I mean, we were position for the things
Speaker 1: that kind of played out in the fourth quarter, and
Speaker 1: the world quickly changed that way changed, uh, very very quickly.
Speaker 1: So I do think that the premise is interesting because
Speaker 1: I think you define it very clearly. And so we're
Speaker 1: in a war. Obviously, things around the virus, and maybe
Speaker 1: the virus isn't gonna get worse. But then we have
Speaker 1: the policymakers, the fiscal policy makers, the monetary policymakers. They've
Speaker 1: taken this montra. We're gonna do whatever it takes. So
Speaker 1: this is dragging modeled in twelve. They've all adopted it,
Speaker 1: so they're gonna get tested. So this is why we're
Speaker 1: going to continue to see different amounts of fiscal stimulus,
Speaker 1: different monetary policy. So you know that's going to create
Speaker 1: some stability, and then ultimately you know we're gonna have
Speaker 1: to see some progress on the medical front, so you know,
Speaker 1: I'm not sure. To be honest, it's a high conviction
Speaker 1: type world. Right now we are positioned. But what we're
Speaker 1: also doing is it extending our time horizon because there
Speaker 1: isn't clarity what's going to happen a month, a quarter
Speaker 1: from now. But you know if a year from now,
Speaker 1: two years, if you have that ability to have that
Speaker 1: sort of time frame, I can come up with a
Speaker 1: more constructive sort of view because I think this stimulus
Speaker 1: could actually hit at a time that maybe we're starting
Speaker 1: to see, uh, some improvement you know around the buyers,
Speaker 1: around the uptick in economic activity, and I could set
Speaker 1: a decent backdrop for risk assets. But again that's getting
Speaker 1: the timing rights to the hard part. Big question. We
Speaker 1: only have about thirty seconds for you to answer it, Jack,
Speaker 1: But oil, I mean that obviously has had partially to
Speaker 1: do with the pandemic, but largely outside of it. How
Speaker 1: does that figure into your thesis here? So you're right,
Speaker 1: I think it's mostly I say eighty percent driven by
Speaker 1: demand side, driven by you know that the pandemic, there's
Speaker 1: a supply issue, has a leverage the hedge fund guys
Speaker 1: that uh, the c K commoding trading advisors. They're still
Speaker 1: really long oil contracts, so you know, they're they can't
Speaker 1: take this much pain, so they're undwinding these things. So yeah,
Speaker 1: it's um, it's just reflective of a week demand when
Speaker 1: you let the flow down a global growth. All right,
Speaker 1: we're gonna leave it there. Thank you so much, Jack McIntyre,
Speaker 1: he is the I want to make sure I get
Speaker 1: your tile to write. Global Fixing Income portfolio manager for
Speaker 1: Brandywine Global Investment Management, joining us on the phone from Philadelphia.
Speaker 1: Thanks for listening to Bloomberg Business Week. You can subscribe
Speaker 1: to the podcast on iTunes, SoundCloud, or Bloomberg dot com.
Speaker 1: You can also listen to our radio show every weekday
Speaker 1: at two pm Eastern only on Bloomberg Radio