WEBVTT - Bloomberg Intelligence: Inflation Progress, Super Bowl Weekend 0:00:02.920 --> 0:00:10.840 Bloomberg Audio Studios, podcasts, radio news. You're listening to the 0:00:10.840 --> 0:00:15.000 Bloomberg Intelligence Podcast. Catch us live weekdays at ten am 0:00:15.040 --> 0:00:17.480 Eastern on Affo card playing and broud Otto with the 0:00:17.520 --> 0:00:21.320 Bloomberg Business App. Listen on demand wherever you get your podcasts, 0:00:21.640 --> 0:00:23.320 or watch us live on YouTube. 0:00:25.360 --> 0:00:28.000 Let's go from equities to the bond market. We got 0:00:28.080 --> 0:00:30.400 that revision of CPI. We got a lot of bond 0:00:30.480 --> 0:00:32.320 auctions this week. Everything seemed to be okay. 0:00:32.479 --> 0:00:34.360 We are though at you're to date highs with some 0:00:35.159 --> 0:00:36.480 of yields across the curve. 0:00:36.520 --> 0:00:39.600 So Ira Jersey, Bloomberg Intelligence Chief US interest rate strategist, 0:00:40.240 --> 0:00:42.440 joins us. Now, Okay, Ira, if you were to describe 0:00:42.479 --> 0:00:46.280 this week so far, how would you describe it choppy? 0:00:47.479 --> 0:00:50.519 Certainly we see somewhat higher yields, you know, from the 0:00:50.560 --> 0:00:53.240 beginning of the week to now. But when you look 0:00:53.280 --> 0:00:57.040 at the preponderance of the data that we've received, plus 0:00:58.040 --> 0:01:00.560 plus how the auctions went, and you so other things, 0:01:00.600 --> 0:01:03.400 we're pretty decent in terms of demand. So these higher 0:01:03.520 --> 0:01:06.640 yields are starting to draw in some investors, which leads 0:01:06.720 --> 0:01:08.840 us to believe that we're probably trying to find a 0:01:08.959 --> 0:01:11.960 range here for a lot of places along the curve, 0:01:12.040 --> 0:01:15.160 you know, the ten years somewhere broadly speaking, between three 0:01:15.280 --> 0:01:19.160 eighty and four and a quarter. You know, I suspect 0:01:19.200 --> 0:01:22.240 that until we get to at least the March FMC meeting, 0:01:22.319 --> 0:01:23.920 that we might stay in that range. So you have 0:01:24.000 --> 0:01:26.760 another month basically of just choppy trading. 0:01:27.480 --> 0:01:31.000 So where are we when you kind of talk to 0:01:31.080 --> 0:01:34.000 clients out there in terms of timing of a rate 0:01:34.080 --> 0:01:38.280 cut March off the table? It seems like I hear 0:01:38.360 --> 0:01:41.320 now there's waffling on May that maybe people are pushing 0:01:41.360 --> 0:01:41.960 out to June. 0:01:42.440 --> 0:01:43.000 What do you see? 0:01:43.640 --> 0:01:45.800 Yeah, that's true. And then there's but there's another camp 0:01:45.840 --> 0:01:49.120 also that that suggests that maybe if the Federal Reserve 0:01:49.200 --> 0:01:51.840 doesn't cut in March, which you know, like you said, 0:01:51.960 --> 0:01:54.320 is certainly not priced in the market anymore as it 0:01:54.440 --> 0:01:57.280 used to be, that maybe the Federal Reserve will need 0:01:57.360 --> 0:02:00.840 to cut by fifty in May if they start. So 0:02:01.240 --> 0:02:04.000 there's a lot of different camps right now. It doesn't 0:02:04.040 --> 0:02:05.640 seem to be a whole lot of consensus, which of 0:02:05.680 --> 0:02:09.320 course is what makes markets of course, but a lot 0:02:09.360 --> 0:02:11.880 of times there's certainly people leaning one way or the 0:02:11.960 --> 0:02:13.880 other as to you know, whether or not they'll be 0:02:13.919 --> 0:02:16.079 a cut in May, whether or not, and then the 0:02:16.200 --> 0:02:19.760 magnitude of that cut now is a discussion point among investors, 0:02:19.800 --> 0:02:22.720 and there's just feeling that the longer the Fed weights, 0:02:22.960 --> 0:02:25.880 the more that they may have to cut later, or 0:02:25.960 --> 0:02:28.400 that they might cut faster. So the idea being that 0:02:28.480 --> 0:02:31.880 if they don't maybe go in cut in either March 0:02:32.480 --> 0:02:34.320 or May, that maybe in June they have to cut 0:02:34.400 --> 0:02:37.959 fifty basis points as a starting point. I'm skeptical of that, 0:02:38.160 --> 0:02:40.480 and I actually think that the Federal Reserve would do 0:02:40.639 --> 0:02:45.200 well to give themselves optionality by cutting in May and 0:02:45.320 --> 0:02:49.000 then not maybe cutting in June, and that way thereafter 0:02:49.480 --> 0:02:52.200 they can make a decision meeting by meeting. The problem 0:02:52.320 --> 0:02:55.440 is is that markets always interpolate and say, okay, well, 0:02:55.480 --> 0:02:57.120 if they're cutting in May, that means they're cutting every 0:02:57.160 --> 0:02:59.480 single meeting after that, and that's certainly not what the 0:02:59.520 --> 0:03:02.240 Federals or would like to be priced into the market 0:03:02.280 --> 0:03:02.760 at this point. 0:03:03.080 --> 0:03:05.480 So we got choppy yields based on what you've seen 0:03:05.520 --> 0:03:08.639 today in the bond market. For the setup, does it 0:03:08.720 --> 0:03:11.240 make sense that you have equities at all time highs? 0:03:11.280 --> 0:03:13.079 I appreciate your the bond guy, but I bet you 0:03:13.160 --> 0:03:13.680 have a view. 0:03:13.600 --> 0:03:18.400 On this, well, you know, risk assets. I think you know, 0:03:18.480 --> 0:03:21.360 there's evaluation metric and then also a growth metric, right, 0:03:21.440 --> 0:03:23.960 so so you have you know, top line, bottom line, 0:03:24.000 --> 0:03:26.160 and then what people are willing to pay for their asset. 0:03:26.720 --> 0:03:28.799 I think that that there's a lot of people. It 0:03:28.880 --> 0:03:32.799 seems like, at least to us, that there's still significant 0:03:32.840 --> 0:03:36.760 flows into into into equities, and part of that is 0:03:36.880 --> 0:03:38.920 just you know, fear of missing out, just people who 0:03:38.960 --> 0:03:41.400 think that they have to be invested. There's still you know, 0:03:41.960 --> 0:03:45.920 there's this idea that hey, savings is has been exhausted, 0:03:46.200 --> 0:03:47.960 and that that means a consumer is not going to 0:03:48.000 --> 0:03:50.440 be spending much as much. But at the same time, 0:03:50.480 --> 0:03:53.040 when you look at the savings rate of the country, 0:03:53.400 --> 0:03:56.040 we're still saving hundreds of billions of dollars a year, right, 0:03:56.080 --> 0:03:57.920 and that money has to go somewhere. Some of that's 0:03:57.920 --> 0:03:59.800 going to be invested in stocks, some will go into 0:04:00.200 --> 0:04:02.520 savings and money market accounts, and some will go into 0:04:02.560 --> 0:04:06.520 bonds obviously, so but so the mix of that savings 0:04:06.560 --> 0:04:08.720 and where it goes I think matters, and just you know, 0:04:09.000 --> 0:04:12.600 people are return chasers, right, particularly retail investors, so you know, 0:04:12.760 --> 0:04:15.640 they open their year end statement and say, hey, stocks 0:04:15.680 --> 0:04:17.440 did great last year. I better buy stocks. 0:04:17.480 --> 0:04:17.640 Now. 0:04:18.400 --> 0:04:20.960 That's not always the best decision, right, but that nonetheless 0:04:21.120 --> 0:04:24.760 that does create these meaningful flows. And then on the 0:04:24.839 --> 0:04:27.400 bond side of things, you know, with with the Fed 0:04:27.520 --> 0:04:31.920 Reserve maybe not cutting as aggressively, there has certainly been 0:04:31.960 --> 0:04:35.520 people rotating out of out of some fixed income assets, 0:04:35.560 --> 0:04:37.880 particularly the front end of the yield curve, and you know, 0:04:38.000 --> 0:04:41.640 maybe going the other direction now and not necessarily being 0:04:41.720 --> 0:04:44.560 short but basically finding other alternatives. And you look at 0:04:44.600 --> 0:04:48.920 money market funds. Money market money market funds continue to 0:04:49.160 --> 0:04:52.680 have massive inflows, and now their assets under management are 0:04:52.880 --> 0:04:55.359 the highest ever once Agallion like. 0:04:55.360 --> 0:04:57.400 You look at the chart, it's so hard to see 0:04:57.440 --> 0:04:59.280 all the zeros because you're like, wait a second, what's that? 0:04:59.480 --> 0:05:01.320 I mean, that's you and six billion six. 0:05:01.720 --> 0:05:04.640 All right, So people keep people keep asking Alex, you know, 0:05:04.720 --> 0:05:07.480 how is the government funding all of these deficits? Well 0:05:07.480 --> 0:05:10.640 it's right there, because people putting money into money market 0:05:10.680 --> 0:05:12.840 funds just means that the government issues T bills and 0:05:12.960 --> 0:05:14.200 money market funds buy them. 0:05:14.880 --> 0:05:15.200 All right. 0:05:15.400 --> 0:05:18.680 Lisa from Upper Manhattan writes in and says, I have 0:05:18.800 --> 0:05:20.800 to ask about the auctions this week. 0:05:21.400 --> 0:05:22.880 How did they go? What did you learn? 0:05:24.160 --> 0:05:27.400 They went very well? Surprisingly well. Actually, what we've seen 0:05:27.480 --> 0:05:30.560 the last few months was you'd have one auction that 0:05:30.600 --> 0:05:32.719 would do well and then another auction would do poorly. 0:05:33.680 --> 0:05:36.160 And you know where people basically pick their spots in 0:05:36.880 --> 0:05:39.440 you know where to invest in auctions. But this week's 0:05:39.440 --> 0:05:41.560 auction is a three year note, the ten year note, 0:05:41.600 --> 0:05:43.840 and the thirty year bond. They all went fine, and 0:05:44.120 --> 0:05:46.960 these were also larger auction sizes. The one that I 0:05:47.080 --> 0:05:49.320 was really worried about was the three year auction because 0:05:49.360 --> 0:05:53.080 that was two billion dollars larger than the month before, 0:05:53.960 --> 0:05:57.200 and that was probably the weakest of the three. But 0:05:57.360 --> 0:05:59.800 people still wanted to buy duration, and I think part 0:05:59.839 --> 0:06:01.800 of that is endemic of the fact that we have 0:06:01.960 --> 0:06:04.000 higher yields now than we did a couple of weeks ago, 0:06:04.400 --> 0:06:06.960 So it was an easier way for people to start 0:06:07.000 --> 0:06:09.839 taking market risk instead of going into the open market 0:06:09.880 --> 0:06:12.440 and paying a bid offer. Because at the auctions, you're 0:06:12.440 --> 0:06:15.840 basically buying on the bid side. So that's attractive for 0:06:15.960 --> 0:06:19.200 some investors, and it does seem like you know what 0:06:19.320 --> 0:06:21.880 we call indirect investors, So those are end users, those 0:06:21.880 --> 0:06:27.239 are foreign portfolio investors or central banks or domestic investment funds. 0:06:28.360 --> 0:06:31.560 They were big participants in this. So this wasn't driven 0:06:31.600 --> 0:06:34.360 by primary dealers. This was really driven by end user 0:06:34.440 --> 0:06:36.400 investors having pretty good demand. 0:06:36.960 --> 0:06:40.800 IIRA next week, you get CPI Tuesday, retail sales Thursday. 0:06:40.880 --> 0:06:41.960 Do you think any of this are really going to 0:06:42.000 --> 0:06:42.640 move the needle for you? 0:06:44.000 --> 0:06:46.040 Well, maybe not in terms of the Federal Reserve, but 0:06:46.080 --> 0:06:50.360 I think it will give some new information obviously as 0:06:50.400 --> 0:06:53.880 to maybe what the future path is. Again, like you know, 0:06:54.360 --> 0:06:56.400 now we're talking about May or June, and we're talking 0:06:56.400 --> 0:06:58.960 about you know, twenty five or fifty whenever the federal 0:06:58.960 --> 0:07:01.360 Reserve does go. So these are always important numbers. And 0:07:01.440 --> 0:07:04.960 CPI is next to payrolls is now the number one. 0:07:06.480 --> 0:07:08.760 So it's payrolls and then CPI, then retail sales in 0:07:08.880 --> 0:07:11.400 that order that the bond market cares about. And when 0:07:11.440 --> 0:07:15.320 you look at the knee jerk reactions after the after 0:07:15.440 --> 0:07:18.760 those those news releases, that's when you see tenure yields 0:07:18.800 --> 0:07:20.280 move the most one way or the other if you 0:07:20.360 --> 0:07:23.480 get a big surprise. So you know, again next to payrolls, 0:07:23.720 --> 0:07:26.680 next week's two numbers are really the key for the 0:07:26.760 --> 0:07:29.200 market and maybe the market direction and the medium Durm. 0:07:29.800 --> 0:07:32.160 All right, Ira, thanks so much, as always appreciate it. 0:07:32.320 --> 0:07:36.240 Ira Jersey chief us in straight strategies for Bloomberg Intelligence, 0:07:36.320 --> 0:07:37.880 kind of getting a sense your rest some more data 0:07:37.880 --> 0:07:40.800 as you mentioned alex Net next week. But I'm just 0:07:40.840 --> 0:07:42.880 going to at the WORP function. It's kind of fifty 0:07:42.880 --> 0:07:46.800 to fifty for a May price cut, and that you know, 0:07:46.840 --> 0:07:49.040 it's been well over one hundred percent chance that there 0:07:49.080 --> 0:07:51.160 would be a May cut. You know, back in January, 0:07:51.240 --> 0:07:53.000 the market was discounting, Hey, it's going to happen in 0:07:53.720 --> 0:07:55.360 May now not a little bit less. 0:07:55.400 --> 0:08:00.480 So you're listening to the Bloomberg Intelligence Podcast. Don't catch 0:08:00.560 --> 0:08:03.480 us live weekdays at ten am Eastern on Apple car 0:08:03.640 --> 0:08:06.760 Play and Android Auto with the Bloomberg Business. You can 0:08:06.800 --> 0:08:10.040 also listen live on Amazon Alexa from our flagship New 0:08:10.120 --> 0:08:13.720 York station just say Alexa playing Bloomberg eleven thirty. 0:08:16.240 --> 0:08:18.240 Here's my question. Are you guys watching the Super Bowl? 0:08:18.280 --> 0:08:22.160 How we confirmed the horse? Yes here, well obviously, Paul, Yeah, yeah, I. 0:08:22.200 --> 0:08:23.720 Guess I feel like I have to I have to 0:08:23.760 --> 0:08:25.600 go to bed at like six thirty seven. 0:08:26.000 --> 0:08:26.960 You're going to get to be here. 0:08:28.120 --> 0:08:30.720 I'll just I'll record it on my VCR. 0:08:31.040 --> 0:08:32.640 I think I have to watch CR. 0:08:33.160 --> 0:08:35.640 Oh wow, he's got his bait it. 0:08:36.360 --> 0:08:39.120 Yeah, next, that's not even a thing I like. I 0:08:39.240 --> 0:08:40.520 have to watch it to be able to have this 0:08:40.600 --> 0:08:43.760 conversation with you guys on socially relevant well sure, I 0:08:43.840 --> 0:08:45.040 mean socially relevant. 0:08:45.040 --> 0:08:45.360 I don't know. 0:08:45.559 --> 0:08:47.120 Do you have a do you have a pick? 0:08:48.800 --> 0:08:48.839 No? 0:08:49.320 --> 0:08:50.560 No, you know who's playing? 0:08:50.800 --> 0:08:53.040 Yes, the forty nine ers and the Cheeks. 0:08:53.440 --> 0:08:54.160 Very good, thank you. 0:08:54.200 --> 0:08:55.559 I think I have to go with the Chiefs because 0:08:55.760 --> 0:08:57.040 my daughter likes tailors. 0:08:58.640 --> 0:09:00.760 But this leads me into the question and of snacks, 0:09:01.280 --> 0:09:03.439 because I'm not going to as we know, I don't 0:09:03.440 --> 0:09:04.920 need junk food, so I'm not going to be eating 0:09:04.960 --> 0:09:06.240 chicken tail. 0:09:06.280 --> 0:09:08.160 This is just not I'm not going to drink beer. 0:09:09.000 --> 0:09:11.679 I'm not going to do those things. So maybe if 0:09:11.720 --> 0:09:12.200 we had. 0:09:13.800 --> 0:09:16.679 We had some prosecco and some hummus, okay, and some 0:09:16.840 --> 0:09:19.520 pita and maybe some cucumbers and carrots. 0:09:20.160 --> 0:09:23.199 That's the food. That's the that's the food for the 0:09:23.280 --> 0:09:24.920 Oscar party, not the super Bowl. 0:09:25.320 --> 0:09:28.040 But I bet you I'm not the only one who's 0:09:28.040 --> 0:09:29.400 going to have to be doing this, which leads I 0:09:29.440 --> 0:09:32.600 into gembar task okay, senior retail staples and packaged food 0:09:32.600 --> 0:09:35.760 analysts Jen Usually this conversation is chicken, wings and beer 0:09:36.240 --> 0:09:37.320 and pizza and stuff. 0:09:37.480 --> 0:09:39.280 Is the conversation different this year? 0:09:40.360 --> 0:09:43.199 Well, it's it's a little bit different. And that snack is. 0:09:43.400 --> 0:09:45.800 Snacks are still a huge part of the Super Bowl, 0:09:46.440 --> 0:09:48.520 but because the viewership is going to be changing a 0:09:48.559 --> 0:09:51.440 little bit for this game, mostly due to that Taylor 0:09:51.520 --> 0:09:55.040 Swift impact that we were talking about, we may see 0:09:55.080 --> 0:09:59.280 a little bit of edging into slightly healthier snacks like 0:09:59.400 --> 0:10:03.280 popcorn or things like that versus just the pizza, you know, 0:10:03.400 --> 0:10:07.240 wings and things like that. How big? 0:10:07.400 --> 0:10:11.000 I mean, it's just it's this weekend, the two weeks 0:10:11.040 --> 0:10:11.800 has become so big. 0:10:11.880 --> 0:10:14.480 And if I'm the package goods companies, is it an 0:10:14.520 --> 0:10:17.960 important day for them to know, push their product, promote 0:10:17.960 --> 0:10:19.840 their products, have people buy their product. 0:10:20.679 --> 0:10:23.640 Yeah, it's it's important in two respects. The first is 0:10:23.679 --> 0:10:26.800 that the Super Bowl is the second biggest food holiday 0:10:26.880 --> 0:10:29.800 in the United States, So in the week up to 0:10:29.920 --> 0:10:33.280 the Super Bowl, people will spend, according to our estimates, 0:10:33.679 --> 0:10:37.319 nine hundred and six million dollars in one week just 0:10:37.480 --> 0:10:40.040 on snacks. When it comes to food and beverage, is 0:10:40.160 --> 0:10:42.520 as a whole for the one week before the super 0:10:42.559 --> 0:10:46.920 Bowl eight point eight billion dollars, So it is a 0:10:47.200 --> 0:10:51.760 meaningful unofficial holiday for beverage and food companies. For sure, 0:10:52.400 --> 0:10:52.840 this might be. 0:10:53.120 --> 0:10:55.800 Really off, but it's also the Lunar New Year, and 0:10:55.880 --> 0:10:58.360 I'm actually going to two parties over the weekend, which 0:10:58.600 --> 0:11:00.559 I don't go to parties, So this is actually a 0:11:00.679 --> 0:11:01.240 moment for me. 0:11:01.400 --> 0:11:03.760 No parties, no beer, no wings. 0:11:04.760 --> 0:11:08.760 I'm really not selling myself days of time spend an 0:11:08.800 --> 0:11:12.280 Expedia dot com. But Jen, is there like an overlap here. 0:11:12.400 --> 0:11:14.400 I mean, I appreciate that the food you might have 0:11:14.520 --> 0:11:16.040 for Lunar New Year is going to be different than 0:11:16.080 --> 0:11:17.719 the snacking you do for the Super Bowl, but it 0:11:17.840 --> 0:11:20.719 is just like a moment for someone that's more, i 0:11:20.760 --> 0:11:22.679 don't know, diversified to really capitalize. 0:11:23.520 --> 0:11:26.400 Absolutely. When you look at some of the package food companies, 0:11:26.840 --> 0:11:31.040 especially those that play in the confectionery space like Mandali's 0:11:31.240 --> 0:11:34.560 or Hershey, they actually tend to see a sales bump 0:11:34.600 --> 0:11:38.960 around Lunar New Year, so you've got complimentary things happening. 0:11:39.080 --> 0:11:41.079 So between the super Bowl and between the New Year, 0:11:41.880 --> 0:11:43.880 it could be a very very nice little period for 0:11:44.080 --> 0:11:47.240 the package food companies and the retailers that sell those products. 0:11:47.760 --> 0:11:50.240 But just remember, as we're going into earning season, all 0:11:50.320 --> 0:11:52.640 of this is going to impact first quarter earnings, not 0:11:52.760 --> 0:11:53.680 fourth quarter earnings. 0:11:54.520 --> 0:11:56.959 Jen has got inner research. Note here, Jen has got 0:11:57.440 --> 0:11:59.000 some data that just blows me away. 0:11:59.000 --> 0:11:59.760 I had no idea. 0:12:00.280 --> 0:12:05.280 The dollar share in the salty snacks category. PepsiCo leads 0:12:05.320 --> 0:12:08.679 the way with sixty point eight percent. Number two the 0:12:08.720 --> 0:12:10.880 private label group as a whole six. 0:12:11.040 --> 0:12:13.439 Point nine percent. Jen, what's good? 0:12:13.520 --> 0:12:16.120 I mean, the salty snack business is PepsiCo. 0:12:16.360 --> 0:12:18.360 PepsiCo is the salty snack business. 0:12:19.280 --> 0:12:21.480 It really is. I mean, and if you have to remember, 0:12:21.520 --> 0:12:25.360 PepsiCo owns Freedo lay right, So all of those, you know, 0:12:25.440 --> 0:12:27.960 all you know, whether it's your lace, potato chips or Gerrita's, 0:12:28.000 --> 0:12:30.559 you know, all of those salty things are all part 0:12:30.600 --> 0:12:34.440 of that Pepsi PepsiCo portfolio. Other players in the salty 0:12:34.480 --> 0:12:38.559 snacks category can also win. Kelenova owns springles, you know, 0:12:38.679 --> 0:12:41.120 that's also a popular kind of game day, pop it 0:12:41.200 --> 0:12:45.440 and eat it kind of thing. Hershey has popcorn brands, 0:12:45.840 --> 0:12:49.120 so you know, but by far the dominant player is PepsiCo. 0:12:49.679 --> 0:12:52.720 What's what's their growth rate, because didn't they disappoint with earnings? 0:12:53.840 --> 0:12:56.040 They did, but they disappointed in earnings. On the beverage 0:12:56.080 --> 0:12:59.800 side of the business, volumes were down, and you know 0:13:00.040 --> 0:13:02.640 part of that was is just elevated and put costs, 0:13:03.000 --> 0:13:04.040 especially in sweeteners. 0:13:04.640 --> 0:13:06.280 So top to us, let's step back, all right, So 0:13:06.320 --> 0:13:07.600 super Bowl is going to be big. People are going 0:13:07.640 --> 0:13:08.400 to go crazy. 0:13:09.200 --> 0:13:12.400 Talk to us about the you know, the supermarket business. 0:13:13.440 --> 0:13:14.880 What's what's going on there in these days? 0:13:16.040 --> 0:13:19.599 Well, you know, with regards to grocery, there's there's a 0:13:19.640 --> 0:13:22.120 couple of things that are happening. So first is we've 0:13:22.160 --> 0:13:25.480 started to see food inflation come down. So that's actually 0:13:25.520 --> 0:13:28.240 good news for the consumer, and that's really being led 0:13:28.280 --> 0:13:31.439 by the grocers. And so when the US goes through 0:13:31.520 --> 0:13:34.800 an inflationary period, the grocers are one of the first 0:13:35.040 --> 0:13:38.400 retailer types that will actually bring prices down for consumers. 0:13:39.000 --> 0:13:40.960 And so although there's been a lot of political buzz 0:13:41.040 --> 0:13:44.719 about food prices still being too high, you know, the 0:13:44.760 --> 0:13:47.560 inflation rate is coming down. We are starting to see 0:13:47.600 --> 0:13:50.920 prices come back down. But that's going to present a 0:13:51.000 --> 0:13:54.120 unique challenge as the year goes on, because if things 0:13:54.240 --> 0:13:57.079 cost less, if you're going to maintain your top line growth, 0:13:57.360 --> 0:14:00.520 that means you have to sell more volume, and so 0:14:00.679 --> 0:14:03.520 that dynamic between that price and volume is going to 0:14:03.640 --> 0:14:06.640 really be exacerbated this year as inflation starts to recede. 0:14:07.320 --> 0:14:09.079 Can we go to Super Bowl ads? I know you 0:14:09.120 --> 0:14:10.400 went away from it for a second, but let's go 0:14:10.440 --> 0:14:13.760 back to the ads. So bud Light, I mean, was 0:14:13.840 --> 0:14:15.720 that the was the Super Bowl last year, the one 0:14:15.760 --> 0:14:16.800 that had the disastrous ad? 0:14:18.640 --> 0:14:21.160 Well, it was, I don't I honestly, I don't know 0:14:21.200 --> 0:14:22.720 if it was part of the Super Bowl, but it was. 0:14:23.280 --> 0:14:23.480 It was. 0:14:24.600 --> 0:14:27.000 It was it, you know where they they kind of 0:14:27.040 --> 0:14:27.320 had that. 0:14:28.760 --> 0:14:32.080 The transgender transgender influencer. 0:14:32.600 --> 0:14:34.720 Yeah, and then I just really disrupted sales, had a 0:14:34.760 --> 0:14:37.160 meaningful impact. What are we going to expect from like 0:14:37.240 --> 0:14:40.360 the retailers and the snack guys with the ads? Like, 0:14:40.440 --> 0:14:42.640 how kind of cautious are we going to see? 0:14:44.320 --> 0:14:46.640 My guess is, you know they'll probably a little be 0:14:46.680 --> 0:14:51.280 a little bit more conservative in terms of broad appeal, right, 0:14:52.160 --> 0:14:53.880 And so at the end of the day, you know, 0:14:54.000 --> 0:14:56.000 you pay a lot of money for a Super Bowl ad, 0:14:56.040 --> 0:14:58.320 and so you wanted to resonate with as many people 0:14:58.320 --> 0:15:02.080 as possible and spurs need people to action to buy 0:15:02.120 --> 0:15:04.600 your goods and services, and so I think it's a 0:15:04.640 --> 0:15:08.040 reasonable assumption that they'll be kind of mainstream type of messages. 0:15:08.720 --> 0:15:11.000 But of course, you know, forty four percent of people 0:15:11.000 --> 0:15:13.560 who tune into the Super Bowl do it for the ads, 0:15:14.320 --> 0:15:17.560 So it's it's it's a form of entertainment, and so 0:15:17.720 --> 0:15:21.480 I wouldn't expect anything too serious or too heavy as 0:15:21.560 --> 0:15:23.000 we look at the advertisements this year. 0:15:23.120 --> 0:15:25.080 Yeah, and Bloomberg News had a story out today just 0:15:25.320 --> 0:15:27.720 you know, saying how it's you know, it's gonna be 0:15:28.560 --> 0:15:29.000 right down. 0:15:28.880 --> 0:15:29.640 The middle of the fairway. 0:15:29.720 --> 0:15:31.760 Try not to get anybody up set, try to make 0:15:31.800 --> 0:15:34.720 people feel good, try to bridge some gaps. Maybe, so 0:15:34.800 --> 0:15:37.040 we'll see how that plays out. But again, seven million 0:15:37.080 --> 0:15:38.880 dollars for a thirty second spot. 0:15:39.000 --> 0:15:41.200 Is what's seven million dollars for thirty second spot? 0:15:41.360 --> 0:15:41.520 Yes? 0:15:42.600 --> 0:15:45.920 Whow now? Actually it's little to no growth from last year. 0:15:46.240 --> 0:15:47.640 And I actually think people are going to get a 0:15:47.680 --> 0:15:49.960 great buy for that seven million dollars because it is 0:15:50.080 --> 0:15:52.640 going to have a better audience I think, better demographics, 0:15:52.680 --> 0:15:56.080 more women than too typical, and that makes it more 0:15:56.200 --> 0:15:59.720 valuable in my opinion. I know exactly, I am point 0:16:00.040 --> 0:16:01.040 with the case in point right. 0:16:01.080 --> 0:16:02.160 Just get me some homicides. 0:16:02.160 --> 0:16:05.240 We're good, exactly, Thanks so much for joining us. 0:16:05.280 --> 0:16:08.520 Jen Bartashic just covers all the consumer space for Bloomberger Intelligence, 0:16:09.000 --> 0:16:10.560 doing a great job taking a look here at some 0:16:10.640 --> 0:16:13.760 of the package goods companies and kind of how they play. 0:16:13.840 --> 0:16:16.920 How important this Super Bowl Sunday is and it's some big, 0:16:17.000 --> 0:16:18.160 big dollars out there. 0:16:18.200 --> 0:16:18.960 But again, I was just. 0:16:19.000 --> 0:16:21.960 Blown away by the fact that in the salty snacks category, 0:16:22.560 --> 0:16:24.960 PepsiCo sixty percent of the market. 0:16:25.040 --> 0:16:26.240 Are we all Freedo lovers here? 0:16:26.320 --> 0:16:26.360 Like? 0:16:26.480 --> 0:16:28.640 Is this an takeaway from you guys? Like straight up? 0:16:28.840 --> 0:16:32.480 Like yeah, straight up, fres that's the go to dude. 0:16:32.720 --> 0:16:34.360 Can you you can dip Freedo's. 0:16:35.280 --> 0:16:37.440 I mean they're already made of garbage, right, so you 0:16:37.480 --> 0:16:38.800 can just dip them in anything. 0:16:38.880 --> 0:16:40.080 Yeah, exactly exactly. 0:16:40.080 --> 0:16:40.440 I mean. 0:16:42.400 --> 0:16:44.000 Somebody around here likes the cheese its and that's a 0:16:44.080 --> 0:16:47.080 solid snack. But I have to go Frito's over Jesus, 0:16:47.560 --> 0:16:51.760 what do you watch it down with? Budweiser in cans 0:16:51.840 --> 0:16:52.400 really nice. 0:16:52.280 --> 0:16:52.960 Red wine. 0:16:56.080 --> 0:16:59.000 With freedom. It's a great peering. 0:16:59.160 --> 0:17:02.160 No, the house brew in the sweetiest state is Budweiser 0:17:02.400 --> 0:17:03.880 in Cans has to be. 0:17:05.359 --> 0:17:09.200 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:17:09.320 --> 0:17:12.040 weekdays at ten am Eastern on Apple car Playing and 0:17:12.160 --> 0:17:15.000 broud Otto with the Bloomberg Business app. Listen on demand 0:17:15.080 --> 0:17:18.720 wherever you get your podcasts, or watch us live on YouTube. 0:17:20.040 --> 0:17:23.680 God retail sales next week, and then we'll also start 0:17:23.800 --> 0:17:26.920 hearing getting the earnings reports from some of the big retillers. 0:17:27.560 --> 0:17:30.360 So we just heard from Gen bartash Is that consumers 0:17:30.400 --> 0:17:32.040 are can spend you know, up to a billion dollars 0:17:32.080 --> 0:17:35.399 on salty snacks and stuff for the Super Bowl. I 0:17:35.400 --> 0:17:37.480 don't know how the consumers do, and I think it's 0:17:37.720 --> 0:17:40.280 pretty good shape. It's checking with Joe Blancharchie is the 0:17:40.400 --> 0:17:44.760 president of Enterprises Client Solutions. I'm sorry, her title president 0:17:44.800 --> 0:17:46.640 of Enterprise Client Solutions and the name of the firm 0:17:46.720 --> 0:17:50.119 is Advantage Solutions. Jill, thanks so much for joining us here, 0:17:50.600 --> 0:17:52.560 give us a sense of I know, we come to 0:17:52.640 --> 0:17:54.960 the Super Bowl week and I guess consumers are buying stuff. 0:17:54.960 --> 0:17:58.040 But how's the consumer doing out there generally in terms 0:17:58.119 --> 0:18:01.600 of you know, going out there and buying stuff versus 0:18:01.720 --> 0:18:02.879 maybe buying experiences. 0:18:04.720 --> 0:18:06.800 Yes, So, first of all, hello and thank you for 0:18:06.880 --> 0:18:09.680 having me back, and really good question, because we're really 0:18:09.760 --> 0:18:11.320 seeing a dichotomy out there. 0:18:11.600 --> 0:18:13.119 It's definitely tough for consumers. 0:18:14.080 --> 0:18:17.640 I heard Jen say that food inflation has cooled, which 0:18:17.720 --> 0:18:20.120 it has, but it's still up twenty five percent since 0:18:20.119 --> 0:18:23.560 twenty nineteen, and that's six points higher than the average inflation. 0:18:23.760 --> 0:18:29.119 So consumers are both pairing down to spend less and 0:18:29.240 --> 0:18:32.080 find things that are more of more value, but at 0:18:32.119 --> 0:18:34.960 the same time looking for affordable indulgences. 0:18:35.320 --> 0:18:37.160 The Super Bowl is one of those. 0:18:37.600 --> 0:18:40.479 It is akin to the next Thanksgiving, where you've got 0:18:40.560 --> 0:18:43.080 herds of people that gather inside the home to do food, 0:18:43.160 --> 0:18:46.000 family fun, football. I think that we saw that the 0:18:46.720 --> 0:18:50.280 NRF Super Bowl surveys predicting a record number of Super 0:18:50.359 --> 0:18:53.400