1 00:00:05,120 --> 00:00:09,200 Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene, along 2 00:00:09,240 --> 00:00:13,080 Speaker 1: with Jonathan Ferrell and Lisa Brownwitz Jay Leye. We bring 3 00:00:13,119 --> 00:00:17,159 Speaker 1: you insight from the best and economics, finance, investment, and 4 00:00:17,280 --> 00:00:23,280 Speaker 1: international relations. Find Bloomberg Surveillance on Apple podcast, Suncloud, Bloomberg 5 00:00:23,360 --> 00:00:30,000 Speaker 1: dot Com, and of course on the Bloomberg terminal. But 6 00:00:30,080 --> 00:00:32,120 Speaker 1: I'm talking. They just told me what to do. It 7 00:00:32,200 --> 00:00:35,640 Speaker 1: is joining us now market Field Assent Management Chairman and CEO. Michael. 8 00:00:35,680 --> 00:00:38,960 Speaker 1: This from Deutsche Bank. Consumer inflation expectations have now clearly 9 00:00:38,960 --> 00:00:43,040 Speaker 1: moved out of the low inflation ragime. This is important, Michael. 10 00:00:43,080 --> 00:00:46,000 Speaker 1: I'm not talking about hyper inflation. I'm talking about finally 11 00:00:46,080 --> 00:00:49,400 Speaker 1: breaking out of the low inflation ratime that really played 12 00:00:49,479 --> 00:00:52,680 Speaker 1: much of the last decade. Do you think we have yes, 13 00:00:52,800 --> 00:00:55,520 Speaker 1: I mean, straightforwardly, I think you have. I think it 14 00:00:55,640 --> 00:00:58,680 Speaker 1: is really a very different environment to anything we saw 15 00:00:59,640 --> 00:01:02,120 Speaker 1: treat COVID, and I think one of the big changes 16 00:01:02,240 --> 00:01:05,679 Speaker 1: that that is going to represent is consumers now have 17 00:01:05,760 --> 00:01:08,840 Speaker 1: an incentive to buy today rather than wait for tomorrow. 18 00:01:09,720 --> 00:01:12,960 Speaker 1: And I think that itself will intensify consumer demand and 19 00:01:13,000 --> 00:01:17,039 Speaker 1: exacerbate the process. Michael, you are somewhat pessimistic on stocks 20 00:01:17,040 --> 00:01:19,480 Speaker 1: according to your latest note, how much more selling are 21 00:01:19,520 --> 00:01:23,640 Speaker 1: you expecting and why I wasn't that pessimistic. I just 22 00:01:23,680 --> 00:01:26,640 Speaker 1: don't think for sellings you know, totally done. I sort 23 00:01:26,640 --> 00:01:29,080 Speaker 1: of say a worst case scenario. I think the index 24 00:01:29,160 --> 00:01:32,120 Speaker 1: is test their two hundred days. UM. You might not 25 00:01:32,200 --> 00:01:33,960 Speaker 1: need you might not need to go that that far. 26 00:01:34,080 --> 00:01:37,320 Speaker 1: But I think what we're in is this process of realization. 27 00:01:37,920 --> 00:01:40,520 Speaker 1: But the strong growth that we've had comes with persistent 28 00:01:40,600 --> 00:01:44,080 Speaker 1: inflation attached. And more than it being good or bad 29 00:01:44,080 --> 00:01:46,600 Speaker 1: for equities, you know, what it does is favor certain 30 00:01:46,640 --> 00:01:50,360 Speaker 1: sectors and disfavor other sectors. So I mean, you know, 31 00:01:50,400 --> 00:01:53,680 Speaker 1: you've said yourselves, you've had a very strong performance by financials, 32 00:01:53,680 --> 00:01:57,080 Speaker 1: which are very yield curve sensitive. Energy has been you know, 33 00:01:57,640 --> 00:02:01,160 Speaker 1: far more impressive than than financials. UM. I think you're 34 00:02:01,160 --> 00:02:04,240 Speaker 1: gonna start to see materials follow suit once people get 35 00:02:04,240 --> 00:02:07,720 Speaker 1: over their fears about about China. And the losers are 36 00:02:07,800 --> 00:02:12,399 Speaker 1: a combination of very sensitive sectors such as utilities UM. 37 00:02:12,480 --> 00:02:14,880 Speaker 1: And if you know, things do sort of proceed and 38 00:02:14,919 --> 00:02:17,480 Speaker 1: you do start to get yields baking out. I think 39 00:02:17,520 --> 00:02:20,480 Speaker 1: the danger event is that you start to chip away 40 00:02:21,200 --> 00:02:23,680 Speaker 1: the attraction of the very high multiple portions of the 41 00:02:23,760 --> 00:02:26,320 Speaker 1: US equity market. So as they say, it's it's video 42 00:02:26,720 --> 00:02:29,639 Speaker 1: winners a loser scenario, um, you know, but that we 43 00:02:29,680 --> 00:02:31,880 Speaker 1: see ahead of ours, I think it would favor certain 44 00:02:31,880 --> 00:02:36,160 Speaker 1: indexes and hurt ours. Michael, you are expert across all 45 00:02:36,200 --> 00:02:40,280 Speaker 1: that we do, equities, bonds, currencies, commodities fold in this 46 00:02:40,440 --> 00:02:45,760 Speaker 1: commodity moment into the other asset classes in particularly equities. 47 00:02:45,880 --> 00:02:48,799 Speaker 1: Do you believe in the commodities super rarely that we're 48 00:02:48,800 --> 00:02:52,600 Speaker 1: beginning to see? And what does it mean for stocks? Yeah? 49 00:02:52,639 --> 00:02:58,440 Speaker 1: I mean commodity equities look very cheap compared to commodity prices. Um. 50 00:02:58,480 --> 00:03:01,720 Speaker 1: You know, energy equities are nowhere close to where they 51 00:03:01,760 --> 00:03:05,160 Speaker 1: were in two thousand and fourteen, when when trude oil 52 00:03:05,240 --> 00:03:09,440 Speaker 1: places were at current levels. Um. You know, if you 53 00:03:09,480 --> 00:03:12,680 Speaker 1: look at the industrial medals, they again look very cheap. 54 00:03:13,000 --> 00:03:15,880 Speaker 1: You know, have this collapse in iron or the the 55 00:03:15,960 --> 00:03:18,679 Speaker 1: iron ore miners, you know, look look way cheap to 56 00:03:18,800 --> 00:03:21,760 Speaker 1: iron or you know where where it is today. So 57 00:03:22,480 --> 00:03:25,119 Speaker 1: you know, I think the market remains skeptical. I think 58 00:03:25,160 --> 00:03:30,079 Speaker 1: it's viewed commodity equities as excellent trading vehicles. I think 59 00:03:30,160 --> 00:03:32,239 Speaker 1: you know, betther to be large amounts of money have 60 00:03:32,360 --> 00:03:34,800 Speaker 1: been happy to jump into commodities and then jump out 61 00:03:34,800 --> 00:03:37,520 Speaker 1: of them. Um. You know what we haven't yet seen 62 00:03:37,680 --> 00:03:40,800 Speaker 1: is is a sort of moveless, sort of heavy fundamental 63 00:03:40,880 --> 00:03:44,000 Speaker 1: investors back into the commodity space. Now, there's a couple 64 00:03:44,040 --> 00:03:45,920 Speaker 1: of very good recents of that. One is it's been 65 00:03:45,960 --> 00:03:48,760 Speaker 1: a terrible place to be for a decade. And I 66 00:03:48,760 --> 00:03:50,680 Speaker 1: think the other reason is is the E s G 67 00:03:50,840 --> 00:03:53,840 Speaker 1: pressures for a lot of a lot of institutional managers 68 00:03:54,000 --> 00:03:58,600 Speaker 1: on lead them to want to, you know, underplay investment 69 00:03:58,640 --> 00:04:01,240 Speaker 1: in a lot of these areas. Are the over Michael, 70 00:04:01,280 --> 00:04:03,800 Speaker 1: gotta leave it there, thank you, sir, Really good final point, 71 00:04:03,800 --> 00:04:12,760 Speaker 1: Michael Shaw of market Field Asset Management. I know you 72 00:04:12,840 --> 00:04:16,360 Speaker 1: many um an aluminum on the equity markets. Alicia Levine 73 00:04:16,440 --> 00:04:19,000 Speaker 1: b and Y Melon joins us right now, Alicia, to 74 00:04:19,040 --> 00:04:21,159 Speaker 1: the point out there right now, and this is really 75 00:04:21,160 --> 00:04:23,880 Speaker 1: in the zeitgeis this morning. Do you buy on the 76 00:04:23,960 --> 00:04:26,880 Speaker 1: rumor of banks doing better or do you sell on 77 00:04:26,920 --> 00:04:29,640 Speaker 1: the news of their earnings tomorrow? What do you do 78 00:04:30,080 --> 00:04:33,960 Speaker 1: with an overweight in banks? So I think that the 79 00:04:34,040 --> 00:04:36,880 Speaker 1: market is set up for this particular quarter to be 80 00:04:37,160 --> 00:04:40,560 Speaker 1: tilted more towards the reopening and cyclical. So I think 81 00:04:40,640 --> 00:04:43,680 Speaker 1: here you buy the banks, but I think you have 82 00:04:43,800 --> 00:04:46,720 Speaker 1: to be careful because we've already had a huge move 83 00:04:47,080 --> 00:04:50,560 Speaker 1: both in energy and banks coming into the quarter. And 84 00:04:50,600 --> 00:04:53,159 Speaker 1: the key issue, as you've been talking about, is the 85 00:04:53,279 --> 00:04:57,839 Speaker 1: loan book, and we have seen anemic loan growth across 86 00:04:57,880 --> 00:05:00,800 Speaker 1: the banks for for the last few weeks, actually for 87 00:05:00,839 --> 00:05:03,800 Speaker 1: the last few quarters. When you think about it, households 88 00:05:03,839 --> 00:05:08,240 Speaker 1: are still flushed with cash and businesses are flushed with cash. 89 00:05:08,720 --> 00:05:12,360 Speaker 1: So where is that demand for loan loans coming from? 90 00:05:12,400 --> 00:05:14,560 Speaker 1: That's really the next leg of growth here. So I 91 00:05:14,600 --> 00:05:18,560 Speaker 1: would say be long, be strong, but be faded a 92 00:05:18,600 --> 00:05:21,080 Speaker 1: little bit, only because we've had such a strong move here. 93 00:05:21,080 --> 00:05:23,159 Speaker 1: I do think the quarter is going to be a 94 00:05:23,279 --> 00:05:25,960 Speaker 1: higher yield and a cyclical plate for the quarter. I 95 00:05:26,000 --> 00:05:27,880 Speaker 1: think we're set up for that Atlicia. Set me up 96 00:05:27,880 --> 00:05:30,000 Speaker 1: for next year. Then you and I have been talking recently, 97 00:05:30,000 --> 00:05:33,159 Speaker 1: and that's valuable to me because you're constructive next year. 98 00:05:33,279 --> 00:05:35,520 Speaker 1: There's a distinction between the chop you expect into year 99 00:05:35,600 --> 00:05:38,280 Speaker 1: end and what you're looking for through next year through 100 00:05:38,320 --> 00:05:42,200 Speaker 1: its entirety th two. What's the difference here? So I 101 00:05:42,279 --> 00:05:44,400 Speaker 1: think we have we have an issue here where we 102 00:05:44,440 --> 00:05:48,080 Speaker 1: have to get through something of an air pocket, and 103 00:05:48,360 --> 00:05:51,040 Speaker 1: the supply chains turned out to be stickier than expected. 104 00:05:51,080 --> 00:05:54,880 Speaker 1: Inflation higher than expected, and growth came down faster than expected. 105 00:05:55,360 --> 00:05:57,359 Speaker 1: But if you look at the estimates, the estimates are 106 00:05:57,400 --> 00:06:02,240 Speaker 1: actually rising for because the demand is still there. So 107 00:06:02,279 --> 00:06:05,000 Speaker 1: this is still a supply shock to the extent that 108 00:06:05,200 --> 00:06:08,680 Speaker 1: this is still a supply shock and not a buyer's 109 00:06:08,839 --> 00:06:12,719 Speaker 1: strike on on the demand side, growth can be higher 110 00:06:12,720 --> 00:06:16,240 Speaker 1: in two and earnings also, what do we have to 111 00:06:16,279 --> 00:06:18,520 Speaker 1: do to get there? We're sitting on the hundred day 112 00:06:18,520 --> 00:06:21,640 Speaker 1: moving average. We're probably going lower from here. You can 113 00:06:21,640 --> 00:06:24,039 Speaker 1: see how the markets closed for the last few days. 114 00:06:24,440 --> 00:06:28,000 Speaker 1: It just can't rise. We still have overhead on resistance 115 00:06:28,000 --> 00:06:31,360 Speaker 1: above us, so we're probably gonna have to test lower. However, 116 00:06:31,520 --> 00:06:34,000 Speaker 1: I think earning season is going to give us a 117 00:06:34,080 --> 00:06:36,880 Speaker 1: really good clue of where we're going on some of 118 00:06:36,920 --> 00:06:39,919 Speaker 1: these supply issues, which is creating the inflation. So the 119 00:06:39,920 --> 00:06:43,200 Speaker 1: two sectors we worry about are the industrials and retail 120 00:06:43,440 --> 00:06:47,000 Speaker 1: because that's where the companies are not able to pass 121 00:06:47,120 --> 00:06:50,640 Speaker 1: along price as easily. Some of the reason why some 122 00:06:50,680 --> 00:06:53,280 Speaker 1: of these sectors have been stickier and not moving higher. 123 00:06:53,920 --> 00:06:57,520 Speaker 1: If we get through earning season with any comments such 124 00:06:57,560 --> 00:07:00,400 Speaker 1: as in the last two weeks of September saw an 125 00:07:00,480 --> 00:07:03,120 Speaker 1: easing of these issues, then if we're off to the races, 126 00:07:03,360 --> 00:07:05,680 Speaker 1: but we have to hear it well, Alicia, if you 127 00:07:05,800 --> 00:07:08,680 Speaker 1: do believe that this will eventually pass, that we will 128 00:07:08,720 --> 00:07:12,600 Speaker 1: see stronger growth in two Do you buy those retail 129 00:07:12,680 --> 00:07:16,920 Speaker 1: and industrial names when they sell off after reporting stickier 130 00:07:16,920 --> 00:07:20,040 Speaker 1: than some people had expected supply chain issues for this year, 131 00:07:20,280 --> 00:07:23,960 Speaker 1: but perhaps not next. Yeah, I would. I would definitely 132 00:07:24,000 --> 00:07:26,960 Speaker 1: buy because we're still constructive on the reopening and Europe 133 00:07:27,040 --> 00:07:31,240 Speaker 1: is behind us more of a stagflation problem there, but 134 00:07:31,360 --> 00:07:34,920 Speaker 1: on a tactical trade the reopening should work in Europe 135 00:07:34,960 --> 00:07:37,560 Speaker 1: as well, and you can you can do some trades 136 00:07:37,920 --> 00:07:39,840 Speaker 1: in Europe as well to add to sort of the 137 00:07:39,920 --> 00:07:43,080 Speaker 1: value tail. But overall, we don't think you should be 138 00:07:43,160 --> 00:07:46,240 Speaker 1: tilted one way or the other and more of a barbell. 139 00:07:46,320 --> 00:07:48,440 Speaker 1: I hate that we're barbell. Everybody uses it. But the 140 00:07:48,480 --> 00:07:50,600 Speaker 1: truth of the matter is this year the market didn't 141 00:07:50,640 --> 00:07:54,720 Speaker 1: reward you for being overweight value or cyclicals. It really 142 00:07:54,800 --> 00:07:57,360 Speaker 1: was a monthly or even quarterly story. And I think 143 00:07:57,360 --> 00:07:59,680 Speaker 1: as we move into the second quarter of next year, 144 00:08:00,200 --> 00:08:04,840 Speaker 1: those supply chain issues are going to lessen commodity price 145 00:08:04,920 --> 00:08:08,760 Speaker 1: spikes come down, and when that happens, you're going to 146 00:08:08,800 --> 00:08:11,160 Speaker 1: see something of a flattening of the yield curve and 147 00:08:11,200 --> 00:08:13,960 Speaker 1: you're going to see increase in growth and you're going 148 00:08:13,960 --> 00:08:16,640 Speaker 1: to see a lowering of the inflation. So you want 149 00:08:16,640 --> 00:08:19,119 Speaker 1: to be prepared for that. So you have a short 150 00:08:19,200 --> 00:08:22,800 Speaker 1: term where inflation is moving higher, inflation expectations are moving higher. 151 00:08:22,840 --> 00:08:25,120 Speaker 1: You have to get through it. But we think by 152 00:08:25,160 --> 00:08:28,160 Speaker 1: the second quarter these supply issues will start to come down. 153 00:08:28,640 --> 00:08:34,160 Speaker 1: And again, commodity price spikes don't last. So Alicia just quickly, 154 00:08:34,280 --> 00:08:36,959 Speaker 1: if I wanted a call option on a better supply 155 00:08:37,040 --> 00:08:39,720 Speaker 1: side story, what do I want to be doing? Kids 156 00:08:39,800 --> 00:08:42,360 Speaker 1: it through industrials? How do I get that? Where do 157 00:08:42,400 --> 00:08:45,600 Speaker 1: I get that exposure? You can do it through industrials. 158 00:08:45,600 --> 00:08:47,520 Speaker 1: But again I would wait to get through this earning 159 00:08:47,559 --> 00:08:49,960 Speaker 1: seasons because look, it's not it's not it's not a 160 00:08:50,000 --> 00:08:51,959 Speaker 1: short bet, right, it could go either way. You need 161 00:08:52,000 --> 00:08:56,320 Speaker 1: to hear some sort of language that they expect a 162 00:08:56,360 --> 00:08:59,679 Speaker 1: better day going forward. But also I would look at 163 00:08:59,720 --> 00:09:03,560 Speaker 1: some of growth sectors, in particular the more value areas 164 00:09:03,640 --> 00:09:05,760 Speaker 1: of tech where they can earn through it. In the end, 165 00:09:05,800 --> 00:09:08,679 Speaker 1: we like companies that can earn, that can earn through 166 00:09:08,720 --> 00:09:12,600 Speaker 1: this and not be such price takers. It's a stock 167 00:09:12,640 --> 00:09:15,800 Speaker 1: pickers market, as we've talked about, and that means you 168 00:09:15,840 --> 00:09:18,439 Speaker 1: have to really do the fundamental analysis on where the 169 00:09:18,440 --> 00:09:21,600 Speaker 1: supply chains are and how companies can pass price on. 170 00:09:21,840 --> 00:09:24,360 Speaker 1: So I'd look at growth sectors. I'd like it, look 171 00:09:24,400 --> 00:09:27,240 Speaker 1: at companies that can earn through this, and I'd also 172 00:09:27,280 --> 00:09:30,480 Speaker 1: add healthcare here as a bit of a defensive play. 173 00:09:30,640 --> 00:09:34,760 Speaker 1: In fact, we're not right and yeah, I gotta run. 174 00:09:34,960 --> 00:09:36,960 Speaker 1: Sorry cloaks, take in produce a get some my oron 175 00:09:37,040 --> 00:09:42,600 Speaker 1: screams which we have to go. Alicia Levigne almost bullied. Yeah, 176 00:09:42,920 --> 00:09:52,400 Speaker 1: just you know it's abuse right now. We will dive 177 00:09:52,960 --> 00:09:55,720 Speaker 1: into CPI. We can do that with Thomas Purcelli RBC 178 00:09:55,880 --> 00:10:00,400 Speaker 1: Capital Markets usually on the linkage of labor to the economy. 179 00:10:00,440 --> 00:10:05,960 Speaker 1: Today we go price Tom Percelly, which inflation series should 180 00:10:05,960 --> 00:10:11,000 Speaker 1: our listeners and viewers pay attention to. I don't think 181 00:10:11,000 --> 00:10:13,640 Speaker 1: there's any one. I think that it's good to actually 182 00:10:13,760 --> 00:10:16,480 Speaker 1: use all the metrics that are out there. So whether 183 00:10:16,559 --> 00:10:21,160 Speaker 1: it's UM CPI headline, core PC headline, core. I think 184 00:10:21,160 --> 00:10:23,199 Speaker 1: that the role um you know, that's how you sort 185 00:10:23,240 --> 00:10:25,200 Speaker 1: of get this mosaic of what what is happening, because 186 00:10:25,200 --> 00:10:28,600 Speaker 1: they're all constructed slightly different. But as as you and 187 00:10:28,640 --> 00:10:31,720 Speaker 1: I have talked about many times over the years, you know, 188 00:10:31,800 --> 00:10:35,040 Speaker 1: I do like to break down inflation into two components, 189 00:10:35,320 --> 00:10:37,800 Speaker 1: goods and services. I think you got a really great 190 00:10:37,800 --> 00:10:41,360 Speaker 1: sense for what's happening from an underlying flation dynamic perspective. 191 00:10:41,600 --> 00:10:43,400 Speaker 1: And I think, as we all appreciate right now, goods 192 00:10:43,440 --> 00:10:47,040 Speaker 1: prices UM are incredibly elevated, which has been the case 193 00:10:47,440 --> 00:10:49,679 Speaker 1: for a number of months. Service part of it has 194 00:10:49,720 --> 00:10:52,560 Speaker 1: really lacked um uh and and you know, in fairness, 195 00:10:52,840 --> 00:10:54,720 Speaker 1: we thought that it would actually be sort of really 196 00:10:54,720 --> 00:10:57,440 Speaker 1: turning up in earnest sort of right around now. UM. 197 00:10:57,480 --> 00:10:59,720 Speaker 1: But again it's it's it's not for a host of reasons, 198 00:10:59,720 --> 00:11:01,199 Speaker 1: not the east of which is you know, I think 199 00:11:01,240 --> 00:11:04,079 Speaker 1: delta really got in the way of of seeing this shift. 200 00:11:04,120 --> 00:11:05,520 Speaker 1: I mean, we had long thought that there would be 201 00:11:05,559 --> 00:11:09,679 Speaker 1: this good spending shift or spending away from goods to services. 202 00:11:09,920 --> 00:11:12,840 Speaker 1: It hasn't really materialized, um in large part because because 203 00:11:12,880 --> 00:11:15,480 Speaker 1: of delta um and, and there's obviously other factors. I 204 00:11:15,480 --> 00:11:17,040 Speaker 1: mean I think there are supplied controls even in the 205 00:11:17,040 --> 00:11:19,080 Speaker 1: service space, but those are the right ways I think 206 00:11:19,080 --> 00:11:22,040 Speaker 1: of thinking about inflation. To your bigger question, is real 207 00:11:22,240 --> 00:11:26,200 Speaker 1: estate a good or a service? Yeah, so it's going 208 00:11:26,240 --> 00:11:28,720 Speaker 1: to show up in in services, right, so you know, 209 00:11:28,760 --> 00:11:32,640 Speaker 1: in fact it's it's the single biggest component of of 210 00:11:32,720 --> 00:11:35,880 Speaker 1: services and cp I. Uh. And that is one area 211 00:11:35,880 --> 00:11:38,439 Speaker 1: where again we've we've been talking about this for for 212 00:11:38,559 --> 00:11:41,200 Speaker 1: months and months that you would see this this this 213 00:11:41,280 --> 00:11:44,679 Speaker 1: sort of floor put underneath inflation because of real estate, right, 214 00:11:44,679 --> 00:11:46,840 Speaker 1: because of all of the sort of price games that 215 00:11:46,880 --> 00:11:50,560 Speaker 1: we've seen that ultimately bleed into rentals. Um, that would 216 00:11:50,840 --> 00:11:53,040 Speaker 1: put a floor underneath inflation in and look, it's it's 217 00:11:53,040 --> 00:11:55,400 Speaker 1: been more or less happening um. And I think again 218 00:11:55,440 --> 00:11:56,840 Speaker 1: that will take a little bit more time for that 219 00:11:56,920 --> 00:11:59,560 Speaker 1: to really start to um uh sort of feed through 220 00:11:59,800 --> 00:12:02,280 Speaker 1: so or of feeds into price games that we see 221 00:12:02,360 --> 00:12:04,760 Speaker 1: from an inflation perspective feed into the rental component with 222 00:12:04,800 --> 00:12:07,040 Speaker 1: a bit of a lag. Um. So it's something that 223 00:12:07,120 --> 00:12:09,720 Speaker 1: will persist, we think, for many months to come. How 224 00:12:09,720 --> 00:12:11,839 Speaker 1: concerned are you about the idea of a high cp 225 00:12:11,960 --> 00:12:13,960 Speaker 1: I print in a low retail print, this sort of 226 00:12:14,440 --> 00:12:18,280 Speaker 1: combo reading into this whole stag inflationary debate in a 227 00:12:18,360 --> 00:12:23,000 Speaker 1: bad way. Yeah. Yeah, Look, I'm I'm you know, I 228 00:12:23,040 --> 00:12:25,280 Speaker 1: don't know famous least words writing. I don't want to 229 00:12:25,320 --> 00:12:27,160 Speaker 1: just say, I don't want to outright dismiss it, but 230 00:12:27,200 --> 00:12:30,000 Speaker 1: I but I sort of do like the stag flat. 231 00:12:30,320 --> 00:12:34,280 Speaker 1: The stagflation part of this conversation to me is um 232 00:12:34,360 --> 00:12:37,640 Speaker 1: a tricky one. I believe in the flation part of it, 233 00:12:37,760 --> 00:12:39,839 Speaker 1: right because again we've been talking about there'll be more 234 00:12:39,880 --> 00:12:43,360 Speaker 1: persistent inflation than than was appreciated. It's the stag part 235 00:12:43,600 --> 00:12:45,280 Speaker 1: of of it that I have a hard time with. 236 00:12:45,480 --> 00:12:48,400 Speaker 1: The consumers in such fantastic shape right now. Uh you know, 237 00:12:48,440 --> 00:12:50,800 Speaker 1: they're they're sitting on a mountain of cash. Uh. You know, 238 00:12:50,840 --> 00:12:53,439 Speaker 1: you can look at it through the lens of excess saving, 239 00:12:53,480 --> 00:12:55,679 Speaker 1: you can look at it through the lens of um, 240 00:12:55,920 --> 00:12:58,720 Speaker 1: you know, liquid assets, um. But by really almost any measure, 241 00:12:58,920 --> 00:13:02,560 Speaker 1: the consumers looking in really fine shape. So so my 242 00:13:02,600 --> 00:13:06,400 Speaker 1: word of caution is defined stagflation more precisely because if 243 00:13:06,400 --> 00:13:08,520 Speaker 1: you're just talking about growth going from six percent, which 244 00:13:08,520 --> 00:13:10,440 Speaker 1: is roughly what we're gonna have this year, you know, 245 00:13:10,520 --> 00:13:12,280 Speaker 1: down to like three or four percent, which was what 246 00:13:12,320 --> 00:13:15,959 Speaker 1: we expect next year? Is that stagg Is that really 247 00:13:16,760 --> 00:13:21,400 Speaker 1: growth stagnating wildly above potential growth? So um, So I 248 00:13:21,840 --> 00:13:23,360 Speaker 1: have a hard time with that part of it. And 249 00:13:23,640 --> 00:13:25,600 Speaker 1: that's all fair, right, And you sort of put aside 250 00:13:25,760 --> 00:13:28,200 Speaker 1: the controversy over the word and how it's being used, 251 00:13:28,360 --> 00:13:30,320 Speaker 1: And there is this conundrum. You said that the consumers 252 00:13:30,360 --> 00:13:32,000 Speaker 1: are in such a good place, they have so much 253 00:13:32,000 --> 00:13:35,160 Speaker 1: money to spend, and yet consumer sentiment has been declining 254 00:13:35,200 --> 00:13:37,400 Speaker 1: and pretty steadily, and this has raised some concerns and 255 00:13:37,440 --> 00:13:39,760 Speaker 1: the likes of Danny blanche Flower who says this is 256 00:13:39,760 --> 00:13:42,520 Speaker 1: one of the most predictive elements of recession about eighteen 257 00:13:42,520 --> 00:13:45,280 Speaker 1: months before no one else is really talking about recession. 258 00:13:45,360 --> 00:13:48,560 Speaker 1: But how much can you really dismiss consumer sentiment which 259 00:13:48,559 --> 00:13:52,240 Speaker 1: seems to be on a downward trend? Yes, Lisa, what 260 00:13:52,320 --> 00:13:55,280 Speaker 1: I would suggest is in this and you have better 261 00:13:55,320 --> 00:13:58,160 Speaker 1: access to this than me, look at that, Look at 262 00:13:58,160 --> 00:14:01,679 Speaker 1: the languor um confidence measure, right, it actually comes out 263 00:14:01,720 --> 00:14:03,400 Speaker 1: on your Bloomberg is the only place I've ever seen. 264 00:14:03,440 --> 00:14:05,800 Speaker 1: And I think actually Bloomberg may have sort of been 265 00:14:05,840 --> 00:14:07,560 Speaker 1: involved with it at one point, but I think they've 266 00:14:07,600 --> 00:14:10,480 Speaker 1: they've since um um push it off to this, this 267 00:14:10,559 --> 00:14:13,440 Speaker 1: other company Langer. If you look at so again, this 268 00:14:13,520 --> 00:14:15,480 Speaker 1: is what we're talking about inflation measures. I think you 269 00:14:15,520 --> 00:14:18,600 Speaker 1: can look at different confidence measures too. Um. So if 270 00:14:18,640 --> 00:14:20,800 Speaker 1: you look at the University of Michigan, the University of 271 00:14:20,800 --> 00:14:24,120 Speaker 1: Michigan measure is really going to be more influenced by 272 00:14:24,240 --> 00:14:27,600 Speaker 1: things like prices, and so that's down much more prices 273 00:14:27,600 --> 00:14:30,000 Speaker 1: are elevated. People are obviously really feeling the pinch of that. 274 00:14:30,240 --> 00:14:32,480 Speaker 1: If you look at the Conference Boards measure, the Conference 275 00:14:32,480 --> 00:14:35,280 Speaker 1: Boards measure is sort of hanging in there a bit better. Again, 276 00:14:35,320 --> 00:14:37,400 Speaker 1: it's also down a bit, there's no question about that, 277 00:14:37,600 --> 00:14:40,520 Speaker 1: but that's more focused on labor um, so that's remained 278 00:14:40,520 --> 00:14:42,280 Speaker 1: a little bit more buoyant. And then you have something 279 00:14:42,320 --> 00:14:45,280 Speaker 1: like the languor measure um, which is actually done pretty 280 00:14:45,320 --> 00:14:49,280 Speaker 1: well over the course of the last several weeks and months. 281 00:14:49,280 --> 00:14:52,320 Speaker 1: So again it's you know, which measure of of of 282 00:14:52,360 --> 00:14:54,400 Speaker 1: confidence do you really want to look at. I think 283 00:14:54,400 --> 00:14:56,240 Speaker 1: that they're all sort of telling you a story of Look, 284 00:14:56,280 --> 00:14:58,640 Speaker 1: there is some caution out there, there's no question about that. 285 00:14:58,840 --> 00:15:03,680 Speaker 1: I think prices are certainly eroding some element of confidence. 286 00:15:03,720 --> 00:15:06,640 Speaker 1: I think the consumers lack of ability to really go 287 00:15:06,760 --> 00:15:09,360 Speaker 1: out and buy what they want because of lack of inventory. 288 00:15:09,520 --> 00:15:11,560 Speaker 1: I think that's certainly hurting. But if you think about 289 00:15:11,560 --> 00:15:14,080 Speaker 1: the labor backdrop, which is ultimately what is one of 290 00:15:14,080 --> 00:15:17,400 Speaker 1: the key drivers from a confidence perspective, it continues to 291 00:15:17,400 --> 00:15:20,040 Speaker 1: perform pretty pretty well. The words stan inflation, I think 292 00:15:20,160 --> 00:15:23,119 Speaker 1: is just a massive distraction right now, investors an economistic 293 00:15:23,560 --> 00:15:26,720 Speaker 1: they're speaking past each because Tom, you can easily just 294 00:15:26,840 --> 00:15:29,440 Speaker 1: prove that it's not stagflation. I think what market participants 295 00:15:29,440 --> 00:15:32,080 Speaker 1: are looking at, and you know from daddy conversations, they're 296 00:15:32,080 --> 00:15:34,280 Speaker 1: focused on the balance of risks around growth, the balance 297 00:15:34,320 --> 00:15:36,840 Speaker 1: of risk around inflation. They see upside risk to inflation 298 00:15:36,840 --> 00:15:38,880 Speaker 1: and downside risk to growth. And so I guess my 299 00:15:38,960 --> 00:15:41,200 Speaker 1: question is to you next year, how those balance of 300 00:15:41,280 --> 00:15:44,400 Speaker 1: risks evolve as the year grows older. Next year, what 301 00:15:44,440 --> 00:15:47,880 Speaker 1: are you looking for? Yes, so we're looking for slower growth. 302 00:15:48,240 --> 00:15:50,560 Speaker 1: And Jonathan, I think that you've framed it the right way. 303 00:15:50,600 --> 00:15:54,040 Speaker 1: I just forget about these words, right like transitory and 304 00:15:54,040 --> 00:15:56,000 Speaker 1: and stagna. I mean, this is all these words are 305 00:15:56,000 --> 00:15:58,440 Speaker 1: a massive distraction. And so what I would simply say 306 00:15:58,520 --> 00:16:01,360 Speaker 1: is if you're if you're, if you're sort of question 307 00:16:01,400 --> 00:16:03,480 Speaker 1: is simply is growth going to slow next year? The 308 00:16:03,480 --> 00:16:05,520 Speaker 1: answer to that is a resounding yes. I mean, you 309 00:16:05,560 --> 00:16:08,200 Speaker 1: cannot maintain six percent growth. But I think where you're 310 00:16:08,240 --> 00:16:10,040 Speaker 1: going from and where you're going to is critical to 311 00:16:10,080 --> 00:16:12,160 Speaker 1: the conversation. So if you're going to remain north of 312 00:16:12,200 --> 00:16:14,360 Speaker 1: potential growth, which is what we expect, I mean, look, 313 00:16:14,480 --> 00:16:16,480 Speaker 1: I know that you know some uh, there was some 314 00:16:16,560 --> 00:16:19,000 Speaker 1: big down grade of growth or I haven't seen. Just 315 00:16:19,040 --> 00:16:20,840 Speaker 1: someone send me a message at it on it. I 316 00:16:21,240 --> 00:16:23,040 Speaker 1: don't care who downgrades growth. I don't want to know 317 00:16:23,080 --> 00:16:25,120 Speaker 1: where it's going from and where it's going to. Our 318 00:16:25,200 --> 00:16:27,960 Speaker 1: growth is we're looking for just about slightly us than 319 00:16:28,000 --> 00:16:30,320 Speaker 1: four percent growth. I mean, you know, I don't know what. 320 00:16:30,480 --> 00:16:31,640 Speaker 1: I don't know what more to say about that. That That 321 00:16:31,800 --> 00:16:36,280 Speaker 1: is just slowing from what we're witnessing this year next year, 322 00:16:36,400 --> 00:16:38,840 Speaker 1: Is your vector moved down from four percent to something 323 00:16:38,880 --> 00:16:42,160 Speaker 1: lower something your potential? We haven't really yeah, no, we 324 00:16:42,200 --> 00:16:44,160 Speaker 1: haven't really moved our numbers all that much. I mean, look, 325 00:16:44,160 --> 00:16:46,640 Speaker 1: we're always sort of fine tuning our estimates, but we 326 00:16:46,640 --> 00:16:48,800 Speaker 1: haven't made some like wholesale adjustment. I mean we know, 327 00:16:49,160 --> 00:16:51,120 Speaker 1: you know, these are all tents or two on either 328 00:16:51,200 --> 00:16:54,080 Speaker 1: side of what has been our baseline. So no, it's 329 00:16:54,080 --> 00:16:55,640 Speaker 1: not like we're looking for some you know, sort of 330 00:16:55,680 --> 00:16:57,880 Speaker 1: materials slowing. And again, I think it's really hard to 331 00:16:57,920 --> 00:17:00,120 Speaker 1: make the case. Look you have I'll say one more time, 332 00:17:00,160 --> 00:17:02,440 Speaker 1: the consumer setting all that cash. That's great, um, But 333 00:17:02,480 --> 00:17:03,680 Speaker 1: I think you have to keep in mind too, if 334 00:17:03,720 --> 00:17:06,040 Speaker 1: you look at sort of the state of the consumer 335 00:17:06,040 --> 00:17:08,800 Speaker 1: balance sheet, it's in pristine shape. So when when people 336 00:17:08,840 --> 00:17:10,679 Speaker 1: go knocking on the door of banks which are going 337 00:17:10,720 --> 00:17:12,040 Speaker 1: to do ultimate right, because if you look at the 338 00:17:12,080 --> 00:17:15,440 Speaker 1: loans depository issue in the United States, it's it's it's collapsed. 339 00:17:15,680 --> 00:17:17,320 Speaker 1: But at some point people are going to go knocking 340 00:17:17,320 --> 00:17:18,720 Speaker 1: on those doors and guess where they're going to and 341 00:17:18,720 --> 00:17:20,720 Speaker 1: guess what banks are going to find people with really 342 00:17:20,760 --> 00:17:22,960 Speaker 1: really good balance sheets. Right. So I think that that's 343 00:17:23,000 --> 00:17:25,120 Speaker 1: another leg of the conversation, and I think it's being 344 00:17:25,119 --> 00:17:28,720 Speaker 1: completely missed an old the noise of stagnation and transitory 345 00:17:28,760 --> 00:17:31,480 Speaker 1: and all this other nonsense that I think do distract 346 00:17:31,520 --> 00:17:33,879 Speaker 1: I think Jonathan hit the nail on the head. So Tom, 347 00:17:33,960 --> 00:17:36,879 Speaker 1: we are getting a number of analysts coming out including 348 00:17:36,880 --> 00:17:40,399 Speaker 1: Golden Sacks, is Jon Hattias and downgrading the expectation, and 349 00:17:40,440 --> 00:17:43,320 Speaker 1: we're hearing increasingly. The input data shows that some of 350 00:17:43,359 --> 00:17:46,640 Speaker 1: the supply chain disruptions have lasted longer. Why has that 351 00:17:46,760 --> 00:17:51,679 Speaker 1: not materially changed your view? Well, we we expected that 352 00:17:51,680 --> 00:17:53,520 Speaker 1: they would linger for longer. I mean, that's the thing. 353 00:17:53,560 --> 00:17:57,160 Speaker 1: It's like, maybe so I look, we had a pretty 354 00:17:57,160 --> 00:17:58,920 Speaker 1: good call on this, I think for a while now. 355 00:17:59,000 --> 00:18:01,119 Speaker 1: And so again you could to our research anyway you 356 00:18:01,119 --> 00:18:02,439 Speaker 1: want to read it. I mean, we've been saying that 357 00:18:02,480 --> 00:18:05,080 Speaker 1: these issues would linger for longer, so we we never 358 00:18:05,119 --> 00:18:07,560 Speaker 1: really had so we we had it built into our numbers, 359 00:18:07,560 --> 00:18:09,080 Speaker 1: so we never really had to take down our numbers 360 00:18:09,080 --> 00:18:11,720 Speaker 1: in any material way. I mean, it's that's as simple 361 00:18:11,720 --> 00:18:13,919 Speaker 1: as that. You know. For those of you on radio, 362 00:18:14,040 --> 00:18:17,639 Speaker 1: we have Thomas Purcelli today from the offices of RBC 363 00:18:18,280 --> 00:18:23,439 Speaker 1: and John I mean, I'm sorry, this is a Percelli different. 364 00:18:23,760 --> 00:18:27,640 Speaker 1: This is a PERSONI focused without the distractions of children 365 00:18:28,040 --> 00:18:32,800 Speaker 1: and or dog. I mean, yes, I am back in 366 00:18:32,840 --> 00:18:34,960 Speaker 1: the office. It feels, it feels good to be here. 367 00:18:34,960 --> 00:18:36,919 Speaker 1: For you didn't bring the children with the dog with 368 00:18:37,000 --> 00:18:39,679 Speaker 1: you to the office. I didn't and my kids have 369 00:18:39,760 --> 00:18:41,800 Speaker 1: been very upset by this. And actually I think the 370 00:18:41,880 --> 00:18:44,199 Speaker 1: dog is actually taking it worse because you walk in 371 00:18:44,280 --> 00:18:46,239 Speaker 1: and like he looks like a little down, like no 372 00:18:46,240 --> 00:18:50,280 Speaker 1: one's around all day now, Tom, you know a freedom 373 00:18:50,480 --> 00:18:53,360 Speaker 1: as he cashed out that long masknack position. So that's 374 00:18:53,359 --> 00:18:59,919 Speaker 1: what matters a kids. The dog is suffering. Hello pressed 375 00:19:00,000 --> 00:19:03,119 Speaker 1: and who is still long Banessa kid stains. Thank you 376 00:19:03,119 --> 00:19:04,960 Speaker 1: great to have that energy on the writing flowback in 377 00:19:04,960 --> 00:19:08,160 Speaker 1: New York City with humble study that of obvious Canada markets. 378 00:19:13,320 --> 00:19:15,320 Speaker 1: What I want to do right now is a little 379 00:19:15,359 --> 00:19:18,119 Speaker 1: bit of a window into the adult nous of the 380 00:19:18,160 --> 00:19:21,640 Speaker 1: pros we talked to on COVID. We asked media questions, 381 00:19:21,680 --> 00:19:24,760 Speaker 1: they're Germaine to what you believe or worried about it 382 00:19:24,920 --> 00:19:29,040 Speaker 1: that on this terrible pandemic. I'm much adulge is it 383 00:19:29,160 --> 00:19:32,360 Speaker 1: v A Pittsburgh among other hospitals with the Johns Hopkins 384 00:19:32,359 --> 00:19:35,560 Speaker 1: Center for Health Security, and back in October, he and 385 00:19:35,600 --> 00:19:39,680 Speaker 1: a team of people went into the trenches of antibiotic 386 00:19:39,720 --> 00:19:44,600 Speaker 1: consumption wrapped around no sacomial infection, which is infection in 387 00:19:44,680 --> 00:19:49,080 Speaker 1: a hospital and the overlay of that on a viral pandemic. 388 00:19:49,680 --> 00:19:52,680 Speaker 1: We never talked about this stuff. I'm at Dolgia thinks 389 00:19:52,720 --> 00:19:55,760 Speaker 1: about it and publishes on a pro level. I'm sure 390 00:19:55,760 --> 00:20:00,000 Speaker 1: our our, our our hospitals gonna get back to north 391 00:20:00,000 --> 00:20:03,800 Speaker 1: normal or does the linkage of virus and bacteria, I mean, 392 00:20:03,840 --> 00:20:09,040 Speaker 1: our hospitals are forever changed. Hospitals are probably forever changed. 393 00:20:09,080 --> 00:20:12,520 Speaker 1: Because of COVID nineteen. We've not seen an infectious disease 394 00:20:12,560 --> 00:20:16,800 Speaker 1: outbreak really impinge hospital capacity for this long, probably since 395 00:20:16,880 --> 00:20:20,760 Speaker 1: since night, and now hospitals have really reconfigured themselves to 396 00:20:20,800 --> 00:20:23,200 Speaker 1: be able to deal with COVID plus, so COVID plus 397 00:20:23,280 --> 00:20:26,320 Speaker 1: heart attacks, COVID plus strokes, COVID plus all the other 398 00:20:26,640 --> 00:20:29,400 Speaker 1: bacterial infections that we see. So there is been really 399 00:20:29,440 --> 00:20:32,880 Speaker 1: a reconfiguration of how hospitals are. Everything from personal protective 400 00:20:32,880 --> 00:20:36,280 Speaker 1: equipment to visiting hours, all of that has been changed, 401 00:20:36,320 --> 00:20:38,440 Speaker 1: and hospitals are now just much more tuned to the 402 00:20:38,480 --> 00:20:41,200 Speaker 1: threat of infectious diseases because in the past they never 403 00:20:41,240 --> 00:20:43,560 Speaker 1: really cared so much about them because it was kind 404 00:20:43,560 --> 00:20:46,640 Speaker 1: of an afterthought. They were really interested in secretive surgeries. 405 00:20:46,640 --> 00:20:48,399 Speaker 1: And now they realize that that they have to be 406 00:20:48,440 --> 00:20:51,680 Speaker 1: resilient to infectious diseases. I mean microbiology one on one 407 00:20:51,720 --> 00:20:54,320 Speaker 1: on this is stephylacoccus and the worry about you know, 408 00:20:54,440 --> 00:20:59,360 Speaker 1: antibiotics and you know losing the value of antibiotics. How 409 00:20:59,400 --> 00:21:05,480 Speaker 1: does that change within and after a viral pandemic. Well, 410 00:21:05,480 --> 00:21:07,240 Speaker 1: what we what we've seen is that there is still 411 00:21:07,280 --> 00:21:10,359 Speaker 1: a lot of inappropriate antibiotic used for COVID nineteen. So 412 00:21:10,440 --> 00:21:12,600 Speaker 1: somebody might come into the hospital and have pneumonia from 413 00:21:12,640 --> 00:21:16,120 Speaker 1: COVID nineteen, they often get antibiotics started even though they're 414 00:21:16,160 --> 00:21:20,399 Speaker 1: not necessary. So we have seen increases in resistance amongst 415 00:21:20,640 --> 00:21:23,159 Speaker 1: people with COVID nineteen in terms of the bacteria that 416 00:21:23,240 --> 00:21:25,400 Speaker 1: live in their lungs, live on their body because people 417 00:21:25,400 --> 00:21:28,920 Speaker 1: are inappropriately prescribing antibiotics. So when you look at the 418 00:21:29,040 --> 00:21:32,399 Speaker 1: long term public health infectious disease threats, antibiotic resistance is 419 00:21:32,440 --> 00:21:35,000 Speaker 1: probably the biggest one that we face because it threatens 420 00:21:35,040 --> 00:21:37,480 Speaker 1: to pull us to a pre penicillin era. And I 421 00:21:37,520 --> 00:21:40,440 Speaker 1: think that's something that's really important that we that we 422 00:21:40,440 --> 00:21:42,600 Speaker 1: we not take the take our eye off of the 423 00:21:42,640 --> 00:21:45,879 Speaker 1: long game and infectious disease, and there I think bacterial 424 00:21:45,920 --> 00:21:49,280 Speaker 1: resistance has to be considered probably the the top priority 425 00:21:49,440 --> 00:21:51,440 Speaker 1: if there is another pandemic, which a lot of people 426 00:21:51,440 --> 00:21:53,399 Speaker 1: expect there to be. And I know that you particularly 427 00:21:53,400 --> 00:21:56,199 Speaker 1: focus on plague any Buller and all these other issues 428 00:21:56,240 --> 00:21:59,679 Speaker 1: that are percolating around the world. Our hospitals prepared for 429 00:21:59,720 --> 00:22:02,000 Speaker 1: that now, based on the COVID run we've just had, 430 00:22:03,200 --> 00:22:05,040 Speaker 1: they're better prepared than they were in the past. But 431 00:22:05,080 --> 00:22:07,560 Speaker 1: I think this really showed how unprepared they are in general. 432 00:22:07,560 --> 00:22:10,119 Speaker 1: When you look at hospital preparedness, it's something that's often 433 00:22:10,200 --> 00:22:12,480 Speaker 1: an afterthought, something that they do to check a box 434 00:22:12,720 --> 00:22:15,000 Speaker 1: so that they meet their CMS requirement or their Joint 435 00:22:15,040 --> 00:22:18,520 Speaker 1: Commission requirement. And they often focus on mass casualty accidents 436 00:22:18,560 --> 00:22:21,560 Speaker 1: like a shooting or or a fire or something like that, 437 00:22:21,680 --> 00:22:23,960 Speaker 1: not so much on pandemics, not so much on things 438 00:22:24,000 --> 00:22:26,439 Speaker 1: that are a sustained surge of sustained change in the 439 00:22:26,480 --> 00:22:29,200 Speaker 1: way they operate, and that I think has to change. 440 00:22:29,240 --> 00:22:31,240 Speaker 1: You have to have the C suite executives talking to 441 00:22:31,280 --> 00:22:33,840 Speaker 1: the emergency managers. It shouldn't be some kind of afterthought 442 00:22:33,920 --> 00:22:36,919 Speaker 1: that that there that they kind of they basically have 443 00:22:36,960 --> 00:22:40,240 Speaker 1: no communication. This has to be integrated into hospital operations 444 00:22:40,400 --> 00:22:42,040 Speaker 1: if we're going to be prepared even for a for 445 00:22:42,080 --> 00:22:44,480 Speaker 1: a severe flu season in the future. Meanwhile, at the 446 00:22:44,480 --> 00:22:46,159 Speaker 1: state of play right now, a lot of people are 447 00:22:46,200 --> 00:22:50,119 Speaker 1: discounting COVID in terms of the ongoing backdrop it will fade. 448 00:22:50,160 --> 00:22:52,960 Speaker 1: People are counting on that. However, it still is used 449 00:22:53,000 --> 00:22:55,399 Speaker 1: as an explanation for some of the labor market frictions 450 00:22:55,400 --> 00:22:58,240 Speaker 1: that we've seen people saying. Long COVID perhaps or fear 451 00:22:58,280 --> 00:23:00,679 Speaker 1: of COVID is people keeping people out of labor market. 452 00:23:01,000 --> 00:23:04,280 Speaker 1: What's been your experience with the various side effects of 453 00:23:04,359 --> 00:23:06,919 Speaker 1: COVID and how that sort of impinges in people's ability 454 00:23:06,920 --> 00:23:10,760 Speaker 1: to work. There is definitely a small subset of people 455 00:23:10,760 --> 00:23:13,560 Speaker 1: who have a case of COVID and haven't quite got 456 00:23:13,600 --> 00:23:16,120 Speaker 1: back to their baseline. I'm kind of excluding the people 457 00:23:16,119 --> 00:23:17,879 Speaker 1: that were in the ICU because those people are going 458 00:23:17,920 --> 00:23:19,639 Speaker 1: to have post i cu sin their mits, going to 459 00:23:19,720 --> 00:23:21,760 Speaker 1: take them sometime to get to their baseline. But there 460 00:23:21,840 --> 00:23:24,120 Speaker 1: is some group that had mild infection that can't get 461 00:23:24,119 --> 00:23:26,800 Speaker 1: back to it. We don't quite know a lot about 462 00:23:26,840 --> 00:23:29,119 Speaker 1: this other than it happens in older people. It happens 463 00:23:29,160 --> 00:23:31,320 Speaker 1: more likely to happen in females, people with other co 464 00:23:31,440 --> 00:23:34,199 Speaker 1: morbid conditions. But we have bad definitions. We don't know 465 00:23:34,240 --> 00:23:36,960 Speaker 1: exactly what fits into that criteria because some people may 466 00:23:36,960 --> 00:23:39,040 Speaker 1: not have gotten their taste and smell back, whereas other 467 00:23:39,040 --> 00:23:41,480 Speaker 1: people can't walk up the stairs now. So we've got 468 00:23:41,480 --> 00:23:43,480 Speaker 1: to do a lot of science to try and pair 469 00:23:43,560 --> 00:23:45,560 Speaker 1: this down to actually know what's going on, to be 470 00:23:45,600 --> 00:23:47,280 Speaker 1: able to define it and study it and come up 471 00:23:47,320 --> 00:23:49,680 Speaker 1: with treatments. And there are some people coming up with treatments, 472 00:23:49,680 --> 00:23:52,000 Speaker 1: but it's gonna be sometime before we get our hands 473 00:23:52,160 --> 00:23:55,440 Speaker 1: all around long COVID and how likely it is to occur, 474 00:23:55,520 --> 00:23:57,919 Speaker 1: on what treatments may work. Let's get back to the 475 00:23:58,000 --> 00:24:04,640 Speaker 1: mundane doctor adolgef very simply, where are we unmasks? Well, 476 00:24:04,680 --> 00:24:07,280 Speaker 1: we know now during this pandemic that we that masks 477 00:24:07,280 --> 00:24:09,919 Speaker 1: do work, that they do play a major role, especially 478 00:24:09,960 --> 00:24:13,359 Speaker 1: when you're talking about an unvaccinated population. To me, I 479 00:24:13,400 --> 00:24:16,080 Speaker 1: think mask wearing for the for the vaccinated has very 480 00:24:16,119 --> 00:24:18,760 Speaker 1: marginal benefits, maybe for some people who are very risk averse, 481 00:24:18,840 --> 00:24:21,359 Speaker 1: but for the unvaccinated they clearly work, and they also 482 00:24:21,400 --> 00:24:24,360 Speaker 1: work for other respiratory viruses other than COVID nineteen. That's 483 00:24:24,359 --> 00:24:26,720 Speaker 1: why people didn't have that many common colds or didn't 484 00:24:26,760 --> 00:24:29,359 Speaker 1: have influenza. So we may see that become part of 485 00:24:29,359 --> 00:24:32,200 Speaker 1: the culture, not because there's a government recommendation or mandate, 486 00:24:32,520 --> 00:24:34,320 Speaker 1: because people say I'm on a subway or I'm in 487 00:24:34,359 --> 00:24:36,679 Speaker 1: a crowd of congregated place. This is something that I 488 00:24:36,720 --> 00:24:41,040 Speaker 1: think we can um use to blunt in to blunt 489 00:24:41,400 --> 00:24:45,040 Speaker 1: any other respiratory viruses that we may we encounter. Don't 490 00:24:45,080 --> 00:24:46,800 Speaker 1: we have to leave it there. Thank you as always, 491 00:24:46,800 --> 00:24:49,480 Speaker 1: don't hamish it down to that of Jones Helpkins on 492 00:24:49,600 --> 00:24:54,440 Speaker 1: the pandemic. This is the Bloomberg Surveillance Podcast. Thanks for listening. 493 00:24:54,800 --> 00:24:57,560 Speaker 1: Join us live weekdays from seven to ten a m 494 00:24:57,680 --> 00:25:02,440 Speaker 1: Eastern on Bloomberg Radio and Bloomberg Television each day from 495 00:25:02,480 --> 00:25:07,760 Speaker 1: six to nine am for insight from the best in economics, finance, investment, 496 00:25:07,880 --> 00:25:12,919 Speaker 1: and international relations. And subscribe to the Surveillance podcast on 497 00:25:13,000 --> 00:25:16,800 Speaker 1: Apple podcast, SoundCloud, Bloomberg dot com, and of course on 498 00:25:16,920 --> 00:25:21,000 Speaker 1: the terminal. I'm Tom Keane and this is Bloomberg