1 00:00:02,520 --> 00:00:07,000 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:12,560 --> 00:00:13,240 Speaker 2: This is the. 3 00:00:13,200 --> 00:00:17,440 Speaker 1: Bloomberg Surveillance Podcast. Catch us live weekdays at seven am 4 00:00:17,480 --> 00:00:21,240 Speaker 1: Eastern on Apple CarPlay or Android Auto with the Bloomberg 5 00:00:21,320 --> 00:00:24,880 Speaker 1: Business App. Listen on demand wherever you get your podcasts, 6 00:00:25,280 --> 00:00:26,960 Speaker 1: or watch us live on YouTube. 7 00:00:27,480 --> 00:00:32,320 Speaker 3: Lingen with US Now with BMO Capital Marcus Ian on 8 00:00:32,479 --> 00:00:34,920 Speaker 3: full faith and Credit. You have had a vector of 9 00:00:35,040 --> 00:00:39,160 Speaker 3: lower interest rates, price up, yield down. Have you been 10 00:00:39,200 --> 00:00:41,440 Speaker 3: tripped by tariffs? 11 00:00:42,840 --> 00:00:46,040 Speaker 4: I do think tariffs complicate the calculus for lower rates. 12 00:00:46,120 --> 00:00:48,960 Speaker 4: But I do think that the Fed is ultimately going 13 00:00:49,040 --> 00:00:52,480 Speaker 4: to start the process of normalization again, but not until 14 00:00:52,479 --> 00:00:55,120 Speaker 4: we've got greater clarity on what the trade war really means. 15 00:00:55,160 --> 00:00:57,560 Speaker 4: And I do think tenure yields in this year at 16 00:00:57,560 --> 00:00:59,880 Speaker 4: three sixty five, and I'm holding that call for now. 17 00:01:01,240 --> 00:01:03,959 Speaker 3: That's extraordinary to go to a three sixty five right now, 18 00:01:04,000 --> 00:01:07,360 Speaker 3: the ten year yield, Folks, if my eyes won't fail me, 19 00:01:07,760 --> 00:01:11,760 Speaker 3: here's a four thirty rather four point three zero. I 20 00:01:12,520 --> 00:01:16,479 Speaker 3: justin Wolfer's of Michigan, just out with the massive trade 21 00:01:16,520 --> 00:01:20,800 Speaker 3: surplus of movies. If mister Trump goes after services, that's 22 00:01:20,880 --> 00:01:22,080 Speaker 3: more instability. 23 00:01:22,560 --> 00:01:24,080 Speaker 5: Are you able to make an. 24 00:01:23,920 --> 00:01:27,520 Speaker 3: Intelligent forecast out three hours or three months. 25 00:01:29,800 --> 00:01:34,240 Speaker 4: Well implicitly, because the president keeps changing the rules or 26 00:01:34,400 --> 00:01:37,440 Speaker 4: changing the trade dynamics, it's very difficult to estimate what 27 00:01:37,520 --> 00:01:40,520 Speaker 4: this all means for core PCE and therefore the FED 28 00:01:40,640 --> 00:01:42,800 Speaker 4: and the trajectory of the economy. I think the one 29 00:01:42,840 --> 00:01:46,880 Speaker 4: clear takeaway is that there has been a concern raised 30 00:01:46,880 --> 00:01:49,520 Speaker 4: about the dollars status as a reserve currency and whether 31 00:01:49,560 --> 00:01:54,360 Speaker 4: treasuries are still flight to quality assets. And the recent 32 00:01:54,400 --> 00:01:56,960 Speaker 4: price action suggests that those two still hold for the 33 00:01:57,000 --> 00:01:59,040 Speaker 4: time being. But that's going to be the major question 34 00:01:59,120 --> 00:02:00,000 Speaker 4: for the next several months. 35 00:02:00,800 --> 00:02:03,520 Speaker 6: Ian Tom has been drawing our attention to what's happening 36 00:02:03,560 --> 00:02:06,640 Speaker 6: with Taiwan's dollar serving as much as five percent today. 37 00:02:07,720 --> 00:02:11,320 Speaker 6: How do you look at what's happening in other countries 38 00:02:11,360 --> 00:02:14,960 Speaker 6: with their currencies with regard to the dollar, but also 39 00:02:15,000 --> 00:02:17,200 Speaker 6: to the treasury market here in the US. It does 40 00:02:17,240 --> 00:02:18,160 Speaker 6: it send you a signal. 41 00:02:19,880 --> 00:02:22,000 Speaker 4: So there are two aspects of that. First is what's 42 00:02:22,040 --> 00:02:25,320 Speaker 4: going on with the dollar is almost by design for 43 00:02:25,440 --> 00:02:28,840 Speaker 4: a president who is attempting to make US exports more 44 00:02:28,840 --> 00:02:32,280 Speaker 4: attractive by cheapening them on the global stage. As that 45 00:02:32,320 --> 00:02:36,720 Speaker 4: relates to the treasury market. That also makes treasuries comparatively 46 00:02:37,160 --> 00:02:39,919 Speaker 4: cheaper than they might have otherwise been, but only if 47 00:02:39,960 --> 00:02:43,120 Speaker 4: the dollar remains the go to currency, and that's what 48 00:02:43,200 --> 00:02:45,600 Speaker 4: has been focused on this week's auctions. We have the 49 00:02:45,680 --> 00:02:48,480 Speaker 4: ten year tomorrow and the thirty year on Thursday. 50 00:02:48,440 --> 00:02:53,000 Speaker 6: So demand there, What do you anticipate and is it 51 00:02:53,040 --> 00:02:55,079 Speaker 6: going to send you a signal about this whole idea 52 00:02:55,160 --> 00:02:58,240 Speaker 6: of whether or not the US continues to be this 53 00:02:58,320 --> 00:02:59,240 Speaker 6: global safe haven. 54 00:03:00,960 --> 00:03:03,680 Speaker 4: The tenure will be the most important auction of the week. 55 00:03:03,840 --> 00:03:08,720 Speaker 4: We're expecting reasonably solid demand across all the major bidding groups, 56 00:03:09,080 --> 00:03:11,880 Speaker 4: but the market will be focused on the indirect awards. 57 00:03:12,000 --> 00:03:15,160 Speaker 4: They tend to use that as a proxy for overseas demand, 58 00:03:15,520 --> 00:03:18,240 Speaker 4: and that will define how the market reacts and whether 59 00:03:18,360 --> 00:03:20,440 Speaker 4: or not we find ourselves back in a narrative where 60 00:03:20,440 --> 00:03:24,960 Speaker 4: we're worried about the collective buyer strike on US treasures. 61 00:03:25,120 --> 00:03:28,160 Speaker 3: The solution andling in for a lot of governments is 62 00:03:28,200 --> 00:03:33,440 Speaker 3: to extenderation to initiate thirty year, fifty year even farther 63 00:03:33,520 --> 00:03:38,000 Speaker 3: out paper. Is that efficacious? I mean, who wins with 64 00:03:38,160 --> 00:03:41,840 Speaker 3: fifty year paper? Well? 65 00:03:42,000 --> 00:03:45,000 Speaker 4: I don't think that it's been particularly successful at least 66 00:03:45,040 --> 00:03:48,360 Speaker 4: not historically, and so the idea of pushing out the 67 00:03:48,440 --> 00:03:52,200 Speaker 4: average maturity of treasuries borrowing, for example, for the time being, 68 00:03:52,440 --> 00:03:55,720 Speaker 4: is off the table. The only argument that that starts 69 00:03:55,760 --> 00:03:59,440 Speaker 4: to make sense would be in a significant reprice into 70 00:03:59,480 --> 00:04:02,440 Speaker 4: a lower rate environment, where Bessett would choose to lock 71 00:04:02,520 --> 00:04:04,360 Speaker 4: in attractive financing. 72 00:04:04,480 --> 00:04:06,720 Speaker 3: Inanling and thank you so much, greatly appreciate with being 73 00:04:06,760 --> 00:04:09,320 Speaker 3: my capital market this morning. In the stunning call, he 74 00:04:09,440 --> 00:04:14,600 Speaker 3: reaffirms from a ten year yield price up yield down 75 00:04:15,240 --> 00:04:17,920 Speaker 3: a four point three zero to a three point six 76 00:04:18,120 --> 00:04:21,360 Speaker 3: five ish yield. That's a brave call right now out. 77 00:04:21,360 --> 00:04:23,680 Speaker 3: They're not that many people on board that ian. Thank 78 00:04:23,680 --> 00:04:25,360 Speaker 3: you so much. 79 00:04:25,640 --> 00:04:29,520 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 80 00:04:29,560 --> 00:04:32,880 Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto 81 00:04:33,000 --> 00:04:35,920 Speaker 1: with the Bloomberg Business App. You can also listen live 82 00:04:36,040 --> 00:04:39,599 Speaker 1: on Amazon Alexa from our flagship New York station, Just 83 00:04:39,640 --> 00:04:43,200 Speaker 1: say Alexa play Bloomberg eleven thirty Now. 84 00:04:43,200 --> 00:04:47,120 Speaker 3: Specialties, Alicia Levigne would be and ymelth Wealth to get 85 00:04:47,200 --> 00:04:51,280 Speaker 3: us through the market opening and beyond. Alicia, I want 86 00:04:51,360 --> 00:04:54,200 Speaker 3: you to talk to people whose heads are spinning and 87 00:04:54,400 --> 00:04:59,120 Speaker 3: they're in cash, how do they deploy into the markets? 88 00:05:00,760 --> 00:05:04,479 Speaker 7: Well, thanks for having me today. You know, we also 89 00:05:04,720 --> 00:05:06,840 Speaker 7: like to look at markers about when to deploy. We 90 00:05:06,920 --> 00:05:10,720 Speaker 7: try to tell our clients you can't ever time the market, 91 00:05:11,160 --> 00:05:13,880 Speaker 7: but after that nine days, which as you know you've 92 00:05:13,960 --> 00:05:17,480 Speaker 7: all noted, is the best nine days since two thousand 93 00:05:17,520 --> 00:05:19,480 Speaker 7: and four, I think we're going to do a little 94 00:05:19,480 --> 00:05:22,520 Speaker 7: bit of backing and filling here. What we tell our 95 00:05:22,600 --> 00:05:26,400 Speaker 7: clients is, you know, if you're fresh capital, it's always 96 00:05:26,480 --> 00:05:31,799 Speaker 7: good to dust dollar cost average in, meaning you allocate 97 00:05:32,480 --> 00:05:35,320 Speaker 7: some percentage I would say over three months, you know, 98 00:05:35,480 --> 00:05:39,520 Speaker 7: one third, one third, one third, So you don't, you know, 99 00:05:39,880 --> 00:05:43,840 Speaker 7: have all your assets that are that are coming in 100 00:05:43,960 --> 00:05:46,159 Speaker 7: all at the same time. Because markets move around, they're 101 00:05:46,200 --> 00:05:49,360 Speaker 7: two way. It just seems like a better risk adjusted 102 00:05:49,400 --> 00:05:53,000 Speaker 7: way to getting into markets here, and so that's what 103 00:05:53,240 --> 00:05:56,000 Speaker 7: that's what we would that's what we would advise. I 104 00:05:56,240 --> 00:06:02,159 Speaker 7: think with the last four weeks has reiterated to market 105 00:06:02,240 --> 00:06:05,400 Speaker 7: participants who have been in these markets for decades or 106 00:06:05,520 --> 00:06:09,280 Speaker 7: to new ones, is that markets can recover a lot 107 00:06:09,360 --> 00:06:13,200 Speaker 7: more quickly than the real economy, and at times bottom 108 00:06:13,600 --> 00:06:17,160 Speaker 7: on really horrible news, even as the headlines are swirling 109 00:06:17,279 --> 00:06:19,880 Speaker 7: around us, and I think it was just another reminder 110 00:06:19,920 --> 00:06:22,239 Speaker 7: of that the last four weeks really really amazing. 111 00:06:22,320 --> 00:06:23,720 Speaker 8: How the market ended April. 112 00:06:24,040 --> 00:06:24,440 Speaker 3: Yeah, it is. 113 00:06:24,560 --> 00:06:26,200 Speaker 6: It's like I was saying earlier, if you went to 114 00:06:26,240 --> 00:06:27,839 Speaker 6: sleep at the beginning of April and you woke up 115 00:06:27,960 --> 00:06:31,400 Speaker 6: kind of nothing actually happened, and it masked really the 116 00:06:31,880 --> 00:06:35,680 Speaker 6: volatility that we saw. You said bottomed. So my question 117 00:06:35,800 --> 00:06:37,880 Speaker 6: to you was that the bottom at least for this cycle. 118 00:06:39,440 --> 00:06:42,720 Speaker 7: So for the tariff tantrum, are we're calling this the 119 00:06:42,800 --> 00:06:46,080 Speaker 7: tariff tantrum? For the tariff tantrum, we think that forty 120 00:06:46,120 --> 00:06:48,640 Speaker 7: eight to thirty five is likely the bottom, but with 121 00:06:48,760 --> 00:06:52,160 Speaker 7: a huge caveat. And the caveat is, you know, is 122 00:06:52,240 --> 00:06:57,480 Speaker 7: there a credit crisis coming that reverberates throughout the economy 123 00:06:58,000 --> 00:07:01,480 Speaker 7: and then could it be undercut? But I think that 124 00:07:01,680 --> 00:07:07,320 Speaker 7: ultimately the conversation that we've had, every single economist has 125 00:07:07,400 --> 00:07:12,520 Speaker 7: talked about sagflation. A US recession has become the base 126 00:07:12,640 --> 00:07:16,280 Speaker 7: case scenario. We've heard about empty container ships from China, 127 00:07:16,640 --> 00:07:20,800 Speaker 7: We've heard about empty shelves in the US. Christmas is gone, 128 00:07:20,920 --> 00:07:24,760 Speaker 7: Halloween is gone. These are some pretty nasty headlines and 129 00:07:24,760 --> 00:07:26,600 Speaker 7: I don't want to make light of it, because I 130 00:07:26,680 --> 00:07:29,080 Speaker 7: actually do think the US is going to slow down 131 00:07:29,640 --> 00:07:32,960 Speaker 7: and hit an air pocket in the next few months. 132 00:07:33,280 --> 00:07:35,560 Speaker 7: But I think the market already priced it in when 133 00:07:35,600 --> 00:07:39,120 Speaker 7: it dropped almost twenty percent in about a week. And 134 00:07:39,520 --> 00:07:42,240 Speaker 7: what we know when the market drops to that extent, 135 00:07:43,560 --> 00:07:47,160 Speaker 7: it tends to have positive forward returns. And whether you 136 00:07:47,240 --> 00:07:50,440 Speaker 7: measure by the elevated fix or whether you measure by 137 00:07:50,520 --> 00:07:53,480 Speaker 7: the drop down in twenty percent, or whether you measure 138 00:07:53,560 --> 00:07:58,280 Speaker 7: by rock bottom consumer and investor sentiment. And in a sense, 139 00:07:58,720 --> 00:08:00,920 Speaker 7: the market did what it always done, which is, you know, 140 00:08:01,120 --> 00:08:03,960 Speaker 7: it recovered when things look the bleakst and it looked 141 00:08:04,120 --> 00:08:04,760 Speaker 7: the bleakest. 142 00:08:05,400 --> 00:08:07,720 Speaker 3: I love your bottom fishing here the idea that when 143 00:08:07,760 --> 00:08:11,200 Speaker 3: there's the catharsis there very quickly or Alesia, we've got 144 00:08:11,240 --> 00:08:12,360 Speaker 3: to get to the market opening. 145 00:08:12,680 --> 00:08:15,520 Speaker 5: But have you witnessed Catharsis yet? I haven't seen it. 146 00:08:16,880 --> 00:08:19,560 Speaker 7: So I think we had Catharsis. You know that that 147 00:08:19,760 --> 00:08:23,920 Speaker 7: Thursday and Friday after after Liberation Day, so that the 148 00:08:24,040 --> 00:08:26,320 Speaker 7: third and the fourth of April was I mean that 149 00:08:26,480 --> 00:08:29,200 Speaker 7: dropped was about twelve drop in the I think we 150 00:08:29,320 --> 00:08:29,520 Speaker 7: had it. 151 00:08:29,720 --> 00:08:31,840 Speaker 3: A Lesha. I want you to talk to people about 152 00:08:31,920 --> 00:08:34,679 Speaker 3: meg seven. I got Apple with a bond offering this 153 00:08:34,880 --> 00:08:39,120 Speaker 3: morning at Microsoft and other cloud types doing better than good. 154 00:08:39,600 --> 00:08:43,480 Speaker 3: Was there a reinformation in April of ownership of the 155 00:08:43,559 --> 00:08:44,200 Speaker 3: mag seven. 156 00:08:44,640 --> 00:08:47,839 Speaker 7: So look, the conversation we've had for the last few 157 00:08:47,920 --> 00:08:52,160 Speaker 7: months is that American exceptionalism is over, that the rest 158 00:08:52,200 --> 00:08:54,880 Speaker 7: of the world is a better place to invest, that 159 00:08:55,160 --> 00:08:57,800 Speaker 7: Europe is going to far outperform the US this year, 160 00:08:57,880 --> 00:09:00,920 Speaker 7: and by the way, it might, but over a cycle 161 00:09:01,080 --> 00:09:03,880 Speaker 7: we have to discuss. And I think, you know, there 162 00:09:04,040 --> 00:09:08,840 Speaker 7: was a talk of you know, international investors fleeing US markets, 163 00:09:08,880 --> 00:09:11,839 Speaker 7: whether it was the dollar, or the bond market or 164 00:09:11,880 --> 00:09:14,280 Speaker 7: the US equity market. Now there's some truth in that, 165 00:09:14,880 --> 00:09:18,199 Speaker 7: but I think what we saw from earning season was 166 00:09:18,480 --> 00:09:23,840 Speaker 7: what made US markets so compelling. Are the triple beats, right, 167 00:09:23,920 --> 00:09:27,600 Speaker 7: triple beats beat on the top line, beat on the margins, 168 00:09:27,679 --> 00:09:31,240 Speaker 7: and therefore beat on the bottom line. I find it 169 00:09:31,440 --> 00:09:34,520 Speaker 7: hard to find companies in the rest of the world 170 00:09:34,920 --> 00:09:39,240 Speaker 7: that can deliver this kind of outcome quarter after quarter. 171 00:09:39,520 --> 00:09:42,480 Speaker 7: Now there will be a day where this doesn't happen, 172 00:09:42,960 --> 00:09:46,559 Speaker 7: and the thirty percent concentration of the Magnificent seven in 173 00:09:46,640 --> 00:09:50,200 Speaker 7: the SMP is going to be the thirty percent concentration 174 00:09:50,360 --> 00:09:53,000 Speaker 7: is going to be a problem, but it's not today. 175 00:09:53,760 --> 00:09:57,120 Speaker 7: And I think it's just a reminder that you know, 176 00:09:57,280 --> 00:10:01,960 Speaker 7: you're not buying a political situation situation, you're buying companies 177 00:10:02,400 --> 00:10:05,240 Speaker 7: with earnings. And I know there's been an aversion for 178 00:10:05,679 --> 00:10:09,120 Speaker 7: international investors coming into US market, but the US and 179 00:10:09,320 --> 00:10:13,600 Speaker 7: market has sold US and particularly let's call it individual investors. 180 00:10:13,960 --> 00:10:16,720 Speaker 7: They're all in Nope, they didn't sell and they were 181 00:10:16,760 --> 00:10:19,160 Speaker 7: buying more. And I think it's a great example when 182 00:10:19,200 --> 00:10:22,520 Speaker 7: you shed risk, when you shed length, when you know 183 00:10:22,760 --> 00:10:26,480 Speaker 7: longs have to be discarded in favor of shorts, it's 184 00:10:26,559 --> 00:10:28,800 Speaker 7: sort of a right opportunity for the pain trade to 185 00:10:28,840 --> 00:10:29,760 Speaker 7: be the other way. 186 00:10:29,800 --> 00:10:33,640 Speaker 3: Right, which is Alicia, Thank you so much, Alicia Levine 187 00:10:33,840 --> 00:10:36,840 Speaker 3: be and win wealth this morning greatly. I appreciate that. 188 00:10:42,240 --> 00:10:45,800 Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch US live 189 00:10:45,920 --> 00:10:49,040 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 190 00:10:49,160 --> 00:10:52,760 Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or 191 00:10:52,960 --> 00:10:54,440 Speaker 1: watch US Live on YouTube. 192 00:10:54,840 --> 00:10:59,080 Speaker 3: Hugely anticipated with the Joy of Luxury Road from Madison 193 00:10:59,480 --> 00:11:02,400 Speaker 3: down to the Avenue of the Joy of Costco adapting 194 00:11:02,480 --> 00:11:06,760 Speaker 3: each day to the trade war. Dana Telsey joins us 195 00:11:07,120 --> 00:11:10,400 Speaker 3: this morning with a Telsey Advisory group. Will there be 196 00:11:11,160 --> 00:11:12,040 Speaker 3: empty shelves? 197 00:11:12,559 --> 00:11:16,080 Speaker 2: It certainly feels like it. Consumers, well, the retailers. First 198 00:11:16,080 --> 00:11:18,280 Speaker 2: of all, thank you for having me. The retailers need 199 00:11:18,360 --> 00:11:21,160 Speaker 2: to place their orders within the next few weeks for holiday. 200 00:11:21,440 --> 00:11:25,040 Speaker 2: We're hearing retailers starting to market and advertise back to school. 201 00:11:25,280 --> 00:11:28,120 Speaker 2: They're going to start on June first. Some kids aren't 202 00:11:28,120 --> 00:11:30,640 Speaker 2: even out of school by June first, and yet they're 203 00:11:30,640 --> 00:11:33,559 Speaker 2: going to start marketing and advertising on June first. That's 204 00:11:33,640 --> 00:11:36,040 Speaker 2: because they want to have the goods available for the parents. 205 00:11:36,440 --> 00:11:39,840 Speaker 2: And overall, when you think about this, we have companies 206 00:11:39,960 --> 00:11:43,480 Speaker 2: that whether it's low end or high end, price increases. 207 00:11:43,559 --> 00:11:45,079 Speaker 2: There's a third to third a third of what you 208 00:11:45,160 --> 00:11:48,040 Speaker 2: can do to combat this. You can diversify your sourcing, 209 00:11:48,400 --> 00:11:51,319 Speaker 2: but that takes time. It doesn't just happen overnight. You 210 00:11:51,480 --> 00:11:54,040 Speaker 2: share the cost of the manufacturers, and I think that's 211 00:11:54,080 --> 00:11:58,120 Speaker 2: something that's being negotiated almost on a daily basis, depending 212 00:11:58,160 --> 00:12:00,319 Speaker 2: on what the tariff may look like. And at the 213 00:12:00,440 --> 00:12:02,400 Speaker 2: end of the day, you raise prices to the consumer. 214 00:12:02,559 --> 00:12:04,319 Speaker 3: You have a roll of dex like no one in 215 00:12:04,400 --> 00:12:07,599 Speaker 3: the business back to your childhood and your affiliation with 216 00:12:07,720 --> 00:12:11,040 Speaker 3: the good people at BERGDRF. Goodman. Which company do you 217 00:12:11,160 --> 00:12:14,360 Speaker 3: want to call right now to find out the pulse 218 00:12:14,600 --> 00:12:15,719 Speaker 3: of the Trump trade war? 219 00:12:16,360 --> 00:12:18,120 Speaker 2: I mean overall, I want to hear about all a 220 00:12:18,200 --> 00:12:20,800 Speaker 2: lot of the apparel retails and the footwear companies. The 221 00:12:20,880 --> 00:12:25,400 Speaker 2: footwear companies overall have some the biggest exposure to China 222 00:12:25,559 --> 00:12:28,680 Speaker 2: and to Asia. Steve Madden, you want to call Steve 223 00:12:28,679 --> 00:12:30,880 Speaker 2: Madden fifty eight percent of their sourcing. 224 00:12:31,800 --> 00:12:34,000 Speaker 5: Steve Madden, My walls lighter, pick it up. 225 00:12:35,000 --> 00:12:36,719 Speaker 6: You mentioned empty shelves, and I think a lot of 226 00:12:36,800 --> 00:12:38,600 Speaker 6: people over the past couple of weeks have been sort 227 00:12:38,600 --> 00:12:42,079 Speaker 6: of sounding the alarm here about empty shelves and higher prices. 228 00:12:42,400 --> 00:12:44,959 Speaker 6: Yet we haven't seen that yet will we see it? 229 00:12:45,320 --> 00:12:48,640 Speaker 2: So you're exactly right. Basically, it's week by week that 230 00:12:48,720 --> 00:12:51,360 Speaker 2: we're watching things. You heard all the retail real estate 231 00:12:51,480 --> 00:12:55,760 Speaker 2: landlords report last week resilient consumer, good traffic. When would 232 00:12:55,800 --> 00:12:57,920 Speaker 2: you see it? Probably sometime during the summertime. 233 00:12:58,760 --> 00:13:01,080 Speaker 6: That's too soon. I think a lot of people would say, 234 00:13:01,120 --> 00:13:03,040 Speaker 6: how close there are you watching? What's happening with shipping? 235 00:13:03,360 --> 00:13:06,559 Speaker 6: Port of Los Angeles, Port of Long Beach, we heard, 236 00:13:06,880 --> 00:13:09,760 Speaker 6: We've heard analysts who track the ships that are coming in. 237 00:13:10,360 --> 00:13:12,040 Speaker 2: We're hearing around thirty sixty percent. 238 00:13:12,200 --> 00:13:14,319 Speaker 6: Yeah, when you're down one third, two thirds, that's a 239 00:13:14,400 --> 00:13:16,559 Speaker 6: very big deal. When does the consumer start to see that? 240 00:13:17,160 --> 00:13:20,559 Speaker 2: So overall, everything we've heard is retail is inventory levels. 241 00:13:20,720 --> 00:13:22,360 Speaker 2: They were up at the end of the fourth quarter. 242 00:13:22,760 --> 00:13:24,880 Speaker 2: First quarter is still first going to be reported. You 243 00:13:24,920 --> 00:13:26,920 Speaker 2: have a big day this Thursday coming up. Then we'll 244 00:13:26,960 --> 00:13:29,800 Speaker 2: go from there. I think you'll continue to see inventories 245 00:13:29,840 --> 00:13:32,880 Speaker 2: being up. But when you're going to see empty shelves, 246 00:13:33,120 --> 00:13:35,880 Speaker 2: it's going to take a little while, is it. Some 247 00:13:36,520 --> 00:13:39,160 Speaker 2: empty items in midsummer could look like that? 248 00:13:39,800 --> 00:13:43,520 Speaker 3: Okay, Steve Madden shoe sho How cute, Lisa, you get 249 00:13:43,520 --> 00:13:48,560 Speaker 3: that there's symbols shoe Shooh. They're down fifty seven percent 250 00:13:49,520 --> 00:13:54,240 Speaker 3: from the shocking success back ten years of Steve Madden. 251 00:13:54,520 --> 00:13:58,320 Speaker 3: What is Steve Madden actually doing in May? 252 00:13:59,120 --> 00:14:01,319 Speaker 2: Overall? In May, and we're going to hear exactly what 253 00:14:01,400 --> 00:14:03,680 Speaker 2: they're saying, because they're going to report their earnings this week. 254 00:14:04,080 --> 00:14:06,000 Speaker 2: I think they have more newness in their product. I 255 00:14:06,040 --> 00:14:08,319 Speaker 2: think we're going to hear that fifty eight percent is 256 00:14:08,440 --> 00:14:10,920 Speaker 2: coming down hopefully by the end of the year to 257 00:14:11,120 --> 00:14:14,319 Speaker 2: forty percent of sourcing coming from China or even a 258 00:14:14,360 --> 00:14:16,439 Speaker 2: little bit less than that. And look what they just 259 00:14:16,559 --> 00:14:20,280 Speaker 2: announced a couple months ago they bought Kurt Geiger, which 260 00:14:20,400 --> 00:14:24,760 Speaker 2: is a more more fashion forward women's brand that's based overseas. 261 00:14:25,040 --> 00:14:27,280 Speaker 2: Look what it was just announced a half hour ago. 262 00:14:27,800 --> 00:14:30,720 Speaker 2: Sketchers is being bought for sixty three dollars a share 263 00:14:31,360 --> 00:14:34,960 Speaker 2: by three G Capital. So you're seeing some combinations begin 264 00:14:35,040 --> 00:14:36,040 Speaker 2: to happen, even. 265 00:14:35,880 --> 00:14:39,120 Speaker 3: Sketches taking it interesting. Dan Chelsea with its encyclopedic and 266 00:14:39,200 --> 00:14:42,640 Speaker 3: retail we all come all here across the country on 267 00:14:42,720 --> 00:14:45,880 Speaker 3: your morning commute on YouTube. Good morning as well, Tim 268 00:14:45,960 --> 00:14:47,560 Speaker 3: Stenovik in for Paul Suni. 269 00:14:47,640 --> 00:14:50,880 Speaker 6: Tim, Hey, Dana, your top pick for apparelin footwear is Perkinstock. 270 00:14:51,200 --> 00:14:54,160 Speaker 2: Why is that don't have sourcing in Asia? You were 271 00:14:54,160 --> 00:14:56,360 Speaker 2: going to say that as the end Germany and Portugal 272 00:14:56,600 --> 00:14:58,480 Speaker 2: take a look at the pricing power that they have 273 00:14:58,640 --> 00:15:00,240 Speaker 2: with the newness. They don't have a lot lot of 274 00:15:00,320 --> 00:15:04,520 Speaker 2: stores and from women's to men's to kids, you name it, 275 00:15:04,640 --> 00:15:06,200 Speaker 2: the age group, there's appeal. 276 00:15:06,040 --> 00:15:07,760 Speaker 6: Still the how big of a business is the US 277 00:15:07,840 --> 00:15:09,840 Speaker 6: for them? Because they're still importing so that's going to 278 00:15:09,880 --> 00:15:11,720 Speaker 6: be an issue if it's not made in the US. 279 00:15:12,320 --> 00:15:14,400 Speaker 6: President Trump's not happy, right, But it's still a. 280 00:15:14,440 --> 00:15:17,200 Speaker 2: Lower tariff than what yeah from Asia. It's a continuing 281 00:15:17,280 --> 00:15:20,520 Speaker 2: growing business for them, and it's becoming even bigger. 282 00:15:20,920 --> 00:15:25,880 Speaker 3: Okay, Hailey Biber, Hailey Bieber is Hailey Bieber Biber. 283 00:15:26,000 --> 00:15:27,440 Speaker 6: I heard it's Bieber. I heard it's Bieber. 284 00:15:27,520 --> 00:15:31,600 Speaker 3: Okay, Hailey showed up. Hailey Bieber invintaged Guccie at the 285 00:15:31,680 --> 00:15:32,920 Speaker 3: met Gala last year. 286 00:15:33,960 --> 00:15:34,760 Speaker 5: Are you going today? 287 00:15:34,880 --> 00:15:35,400 Speaker 7: I'm not a you. 288 00:15:35,800 --> 00:15:37,920 Speaker 2: No, I think the most fits for you to go 289 00:15:38,160 --> 00:15:39,720 Speaker 2: no more. 290 00:15:39,800 --> 00:15:41,920 Speaker 3: I said, we're going, and she was, She's just going 291 00:15:41,960 --> 00:15:44,760 Speaker 3: to offendy for the Pope, the new Pope. But but 292 00:15:45,120 --> 00:15:48,320 Speaker 3: the met Gala is definitive. Can Gucci begin to salvage 293 00:15:48,400 --> 00:15:49,760 Speaker 3: their brand at the Met Gala? 294 00:15:50,240 --> 00:15:52,680 Speaker 2: Very hard. I think you could more likely see life 295 00:15:52,720 --> 00:15:55,640 Speaker 2: at Gap at the Met Gala rather than Gucci, given 296 00:15:55,680 --> 00:15:56,920 Speaker 2: what you have in the storage right now. 297 00:15:57,520 --> 00:16:02,640 Speaker 3: Discuss within all your heritage here, Discuss the collapse of 298 00:16:02,760 --> 00:16:05,120 Speaker 3: what everybody had to have five years ago. 299 00:16:05,440 --> 00:16:07,920 Speaker 2: Compared to five years ago when Gucci was the biggest 300 00:16:07,960 --> 00:16:11,280 Speaker 2: thing was mixed match patterns and prints. That was all 301 00:16:11,360 --> 00:16:14,400 Speaker 2: the rage at Gucci. Now it is who is Gucci? 302 00:16:14,640 --> 00:16:18,400 Speaker 2: Is it relevant anymore? Where's the newness? Who's taken the place? 303 00:16:18,440 --> 00:16:22,160 Speaker 2: And where there's increases Memeu from Prada, that's where all 304 00:16:22,200 --> 00:16:24,640 Speaker 2: the increases are coming from. And that's where you've seen, you've. 305 00:16:24,560 --> 00:16:28,400 Speaker 3: Been, we've seen a collapse ever like carrying Gucci. 306 00:16:28,840 --> 00:16:31,880 Speaker 2: You know we've seen collapses before. You look at Burbery, 307 00:16:32,160 --> 00:16:36,000 Speaker 2: Burbery went way by the wayside, Look at Ferragamo which 308 00:16:36,080 --> 00:16:39,000 Speaker 2: still hasn't come back, and there's a lot of work 309 00:16:39,040 --> 00:16:41,240 Speaker 2: to be done. So we've seen things. And one of 310 00:16:41,280 --> 00:16:45,160 Speaker 2: the things with luxury brands, you have iconic items that 311 00:16:45,320 --> 00:16:49,680 Speaker 2: have heritage and authenticity. It's easier to reinvent than create 312 00:16:49,720 --> 00:16:50,120 Speaker 2: on a tee? 313 00:16:50,160 --> 00:16:50,600 Speaker 9: Can they be. 314 00:16:50,680 --> 00:16:53,480 Speaker 5: Reinvented under lvmh is mister Arnauld chopped? 315 00:16:53,520 --> 00:16:55,160 Speaker 3: It's a bit to take out Gucci or something. 316 00:16:55,200 --> 00:16:58,760 Speaker 2: I'm not hearing that I'm hearing Bernard Arnault is focused 317 00:16:58,760 --> 00:17:00,960 Speaker 2: on La Loouis Vauton brand and the Christian. 318 00:17:01,720 --> 00:17:03,800 Speaker 5: Now, I mean, come on, Tiffany's a struggle. 319 00:17:04,119 --> 00:17:07,119 Speaker 2: Tiffany's has done a great job. The Louis Vauton brand 320 00:17:07,320 --> 00:17:10,399 Speaker 2: and the Christian Dura brand are what the works are 321 00:17:10,440 --> 00:17:13,160 Speaker 2: in progress. Look at all the designer changes that you've 322 00:17:13,200 --> 00:17:16,560 Speaker 2: had at LVMH. A designer needs to get the feel 323 00:17:16,600 --> 00:17:18,600 Speaker 2: of the brand and then introduce the newness. 324 00:17:18,920 --> 00:17:20,600 Speaker 6: So who's your top pic for luxury right now? 325 00:17:20,960 --> 00:17:23,680 Speaker 2: On the luxury side, I think Tapestry. I think Coach 326 00:17:23,840 --> 00:17:26,880 Speaker 2: is continuing to take share from Michael Cores and they'll 327 00:17:26,920 --> 00:17:28,360 Speaker 2: report this Thursday, Okay. 328 00:17:28,160 --> 00:17:30,920 Speaker 6: So we'll get more details then. I'm thinking about this 329 00:17:31,240 --> 00:17:35,320 Speaker 6: in the context of the I don't know, bigger stuff 330 00:17:35,320 --> 00:17:37,399 Speaker 6: that we see each and every day. So not the 331 00:17:37,480 --> 00:17:40,639 Speaker 6: Louis Vauton's not the LVMH's what we see at the 332 00:17:40,680 --> 00:17:43,640 Speaker 6: grocery store, the expensive eggs that Tom Keene is still 333 00:17:43,680 --> 00:17:48,600 Speaker 6: talking about, right, how are you seeing those prices moderate 334 00:17:49,000 --> 00:17:50,560 Speaker 6: come down or not come down? 335 00:17:50,920 --> 00:17:53,960 Speaker 2: So Primark Primark, which is the value retail, they have 336 00:17:54,080 --> 00:17:56,360 Speaker 2: nearly thirty stores in the US. They're from the UK. 337 00:17:56,840 --> 00:17:59,040 Speaker 2: They reported their numbers last week and they said, with 338 00:17:59,080 --> 00:18:02,000 Speaker 2: the tariffs in the US now and their prices are 339 00:18:02,000 --> 00:18:05,080 Speaker 2: below ten dollars for the most part. They said, going forward, 340 00:18:05,440 --> 00:18:07,240 Speaker 2: and what it looks like if these tariffs at one 341 00:18:07,320 --> 00:18:10,119 Speaker 2: hundred and forty five percent really are the name of 342 00:18:10,160 --> 00:18:13,080 Speaker 2: the game, your prices will be up forty to fifty percent. 343 00:18:13,520 --> 00:18:15,520 Speaker 2: That's significant for the low income consumer. 344 00:18:15,720 --> 00:18:18,959 Speaker 3: Steve Madden creators you brought up, Thank you so much, 345 00:18:19,080 --> 00:18:22,600 Speaker 3: Dana Telsey. TJX, which you and I can agree, are 346 00:18:22,680 --> 00:18:27,760 Speaker 3: the best execution out there. What's the pixie dust at TJX? 347 00:18:28,119 --> 00:18:32,399 Speaker 3: The curing and Steve Madden and Costco Egg department have 348 00:18:32,560 --> 00:18:32,920 Speaker 3: to learn. 349 00:18:33,320 --> 00:18:35,840 Speaker 2: Keep in mind TJX is very different from the others. 350 00:18:36,080 --> 00:18:38,959 Speaker 2: The others are brand designers and creators that have their 351 00:18:39,000 --> 00:18:43,320 Speaker 2: own branded product. TJX has an assortment of branded product 352 00:18:43,359 --> 00:18:45,160 Speaker 2: for the most part, but they make their own Also, 353 00:18:45,720 --> 00:18:48,919 Speaker 2: they're buying a lot of it for discounts or less 354 00:18:49,040 --> 00:18:51,720 Speaker 2: than what the full price is. That's what's so exciting 355 00:18:51,760 --> 00:18:53,400 Speaker 2: about tj It's a treasure hunt. 356 00:18:53,560 --> 00:18:55,600 Speaker 3: Talk about what you were readingow as a child at 357 00:18:55,640 --> 00:19:01,640 Speaker 3: fifty seventh and fifth Avenue. Scarcity. Scarcity is still out 358 00:19:01,760 --> 00:19:04,200 Speaker 3: there like a target, is there? Scarcity? 359 00:19:04,640 --> 00:19:08,040 Speaker 2: You have limited edition and collaborations that are scarcity. Look 360 00:19:08,080 --> 00:19:11,040 Speaker 2: what Alto just announced for seven tours. They're going to 361 00:19:11,080 --> 00:19:16,520 Speaker 2: be the beauty destination for Beyonce for Beyonce's Cowboy Carter Tour. 362 00:19:17,040 --> 00:19:20,320 Speaker 2: That's interesting. That's what scarcity is doing in order to 363 00:19:20,400 --> 00:19:22,919 Speaker 2: drive newness and innovation at mass price levels. 364 00:19:23,280 --> 00:19:27,600 Speaker 6: I've seen some pictures of concerts not fully attended. Can 365 00:19:27,640 --> 00:19:29,520 Speaker 6: you believe I'm saying that a Beyonce concert that's not 366 00:19:29,600 --> 00:19:31,240 Speaker 6: sold out that's surprising? 367 00:19:31,560 --> 00:19:32,240 Speaker 5: Is that an issue? 368 00:19:32,359 --> 00:19:32,479 Speaker 4: Right? 369 00:19:32,800 --> 00:19:35,199 Speaker 2: I've not heard that's an issue. It's just starting now 370 00:19:35,280 --> 00:19:37,359 Speaker 2: for them. It's seven concerts that they'll be involved with. 371 00:19:37,600 --> 00:19:40,320 Speaker 5: One more question, Dana, single best buy right now. 372 00:19:40,640 --> 00:19:44,239 Speaker 2: Single best buy right now. I like Birkenstock. I think 373 00:19:44,280 --> 00:19:48,720 Speaker 2: with Joe Feldman, he's talking about Costco's. 374 00:19:47,680 --> 00:19:50,359 Speaker 3: Okay, what's it come on? This is I know you 375 00:19:50,560 --> 00:19:53,680 Speaker 3: listen every day at Lisa's got Costco on the brain. 376 00:19:54,119 --> 00:19:57,520 Speaker 3: Everyone process that others have to replicate. 377 00:19:57,920 --> 00:20:02,240 Speaker 2: Their private label is quality, their assortment and pricing is competitive. 378 00:20:02,760 --> 00:20:06,320 Speaker 2: They can they can solve a vost business and also 379 00:20:06,480 --> 00:20:10,280 Speaker 2: offer for home, and their prices and the service levels, 380 00:20:10,400 --> 00:20:14,160 Speaker 2: the in stock levels are differentiated versus everyone else. They've 381 00:20:14,200 --> 00:20:15,320 Speaker 2: got quality and value. 382 00:20:15,640 --> 00:20:18,200 Speaker 3: Dana TELCEA, thank you so much, Chelsea Advisory Group. The 383 00:20:18,320 --> 00:20:21,200 Speaker 3: spirit of New York City. I really can't say enough 384 00:20:21,240 --> 00:20:23,320 Speaker 3: about the vibrancy, even in these troubling times. 385 00:20:23,359 --> 00:20:25,360 Speaker 6: What's your birkinstock of choices at the Arizona. 386 00:20:25,840 --> 00:20:28,879 Speaker 3: At the Boston Birkenstocks. There's a few floating around the house. 387 00:20:28,960 --> 00:20:30,560 Speaker 3: I try to give them to the dogs to chew. 388 00:20:31,119 --> 00:20:34,280 Speaker 3: I hear that I don't. I don't. I do the 389 00:20:34,359 --> 00:20:35,800 Speaker 3: clause Dana Telsea, goodbye. 390 00:20:36,119 --> 00:20:40,000 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 391 00:20:40,040 --> 00:20:43,040 Speaker 1: starting at seven am Eastern on Apple Corplay and Android 392 00:20:43,080 --> 00:20:46,080 Speaker 1: Auto with the Bloomberg Business app. You can also listen 393 00:20:46,200 --> 00:20:49,440 Speaker 1: live on Amazon Alexa from our flagship New York station. 394 00:20:50,040 --> 00:20:53,440 Speaker 1: Just say Alexa, play Bloomberg eleven thirty joining. 395 00:20:53,480 --> 00:20:56,359 Speaker 3: It's now a huge value at first always Henrietta Treys 396 00:20:56,400 --> 00:20:59,639 Speaker 3: the Veda Partners and you're Washington, Henriette. I look at 397 00:20:59,680 --> 00:21:02,840 Speaker 3: my phone from a distance at home, It'll be three 398 00:21:02,920 --> 00:21:04,960 Speaker 3: feet away, seven feet away. I don't want to pick 399 00:21:05,000 --> 00:21:07,159 Speaker 3: it up and look at the news flows. So I 400 00:21:07,240 --> 00:21:10,119 Speaker 3: look at the Hill just as an example of a 401 00:21:10,400 --> 00:21:14,040 Speaker 3: Washington internet site that's putting out all the gossip and 402 00:21:14,119 --> 00:21:17,720 Speaker 3: it's just a cacophony of stories. Is that the way 403 00:21:17,800 --> 00:21:19,679 Speaker 3: you feel about Washington right now? 404 00:21:20,920 --> 00:21:23,280 Speaker 9: It's a constant day louge. You're just drinking from a 405 00:21:23,320 --> 00:21:27,440 Speaker 9: fire hose. It's a lot, for sure. The latest stuff 406 00:21:27,480 --> 00:21:29,960 Speaker 9: that y'all are just talking about with Barbie's is just 407 00:21:30,080 --> 00:21:30,639 Speaker 9: the least of it. 408 00:21:31,200 --> 00:21:32,880 Speaker 8: It's all over the place and all over the map. 409 00:21:33,800 --> 00:21:36,200 Speaker 3: If it's all over the map, if I use the 410 00:21:36,280 --> 00:21:41,879 Speaker 3: word the negotiation or deals, do you see any evidence 411 00:21:42,000 --> 00:21:46,240 Speaker 3: there are negotiations or deals or is it just all blather? 412 00:21:47,359 --> 00:21:49,720 Speaker 9: Yeah, So this is a great point. And really the 413 00:21:50,400 --> 00:21:52,720 Speaker 9: question I have is are you talking about trade deals? 414 00:21:52,760 --> 00:21:55,520 Speaker 9: Are you talking about the tax deals? Because they are 415 00:21:55,600 --> 00:22:00,680 Speaker 9: both incredibly fraught, very far from conclusion, and much less 416 00:22:00,760 --> 00:22:03,000 Speaker 9: than the White House is presenting them as. 417 00:22:03,400 --> 00:22:03,440 Speaker 4: So. 418 00:22:03,640 --> 00:22:06,680 Speaker 9: On the trade front, I'm expecting the earliest we get 419 00:22:06,760 --> 00:22:09,119 Speaker 9: deals in the next couple of weeks to be with 420 00:22:09,200 --> 00:22:11,840 Speaker 9: the trio of countries that combined make up less than 421 00:22:11,920 --> 00:22:14,959 Speaker 9: one percent of our trade and goods deficit, the Dominican Republic, 422 00:22:15,080 --> 00:22:16,400 Speaker 9: Peru and Colombia. 423 00:22:16,520 --> 00:22:17,600 Speaker 8: That's not going to move the needle. 424 00:22:17,680 --> 00:22:20,000 Speaker 9: That's not going to bring shipping in from China or 425 00:22:20,119 --> 00:22:23,320 Speaker 9: Vietnam or any other Asian nations, which. 426 00:22:23,200 --> 00:22:24,000 Speaker 8: Is really what we need. 427 00:22:24,400 --> 00:22:27,680 Speaker 9: And then on the tax front, we are facing the 428 00:22:27,800 --> 00:22:30,200 Speaker 9: real crunch time and the House is about to walk 429 00:22:30,240 --> 00:22:33,720 Speaker 9: the plank on one and a half trillion dollars worth 430 00:22:33,760 --> 00:22:37,320 Speaker 9: of spending cuts on things that are extremely popular like medicaid, 431 00:22:37,680 --> 00:22:42,360 Speaker 9: food subsidies for the poor, and the corporate tax rate 432 00:22:42,440 --> 00:22:44,520 Speaker 9: and individual tax rates that. 433 00:22:44,640 --> 00:22:46,800 Speaker 8: Ultimately the Senate will not tick up and will not 434 00:22:46,960 --> 00:22:47,280 Speaker 8: vote on. 435 00:22:47,880 --> 00:22:50,480 Speaker 9: So it's really going to be a question of what issue, 436 00:22:50,520 --> 00:22:53,080 Speaker 9: what trade deals, what negotiations on the tax front are 437 00:22:53,119 --> 00:22:53,520 Speaker 9: you watching? 438 00:22:53,600 --> 00:22:55,400 Speaker 6: Well, let's start with the tax front before we get 439 00:22:55,440 --> 00:22:57,119 Speaker 6: to the trade front, rather before we get to the 440 00:22:57,200 --> 00:23:00,879 Speaker 6: tax front. If indeed what we hear this in the 441 00:23:00,920 --> 00:23:03,879 Speaker 6: coming weeks are deals that only represent such a small 442 00:23:03,960 --> 00:23:06,600 Speaker 6: portion of the trade that we do. Can we still 443 00:23:06,800 --> 00:23:10,240 Speaker 6: look to the details of those deals to understand what 444 00:23:10,359 --> 00:23:12,960 Speaker 6: those bigger trade deals could potentially look like. Will it 445 00:23:13,040 --> 00:23:14,000 Speaker 6: be meaningful, will. 446 00:23:13,920 --> 00:23:17,760 Speaker 9: It move Well, so far it's really just around these 447 00:23:17,800 --> 00:23:20,399 Speaker 9: countries making good on the trade and goods deficits. So 448 00:23:20,840 --> 00:23:25,000 Speaker 9: what that means is LNG exports, soy exports, and other 449 00:23:25,119 --> 00:23:27,639 Speaker 9: agricultural commodities. But it doesn't get to any of the 450 00:23:27,720 --> 00:23:31,159 Speaker 9: core issues that presumably President Trump really had a problem 451 00:23:31,200 --> 00:23:35,159 Speaker 9: with on the campaign trails sufficiently or substantially enough to 452 00:23:35,280 --> 00:23:37,640 Speaker 9: launch trade wars with every single nation on Earth. 453 00:23:38,560 --> 00:23:40,280 Speaker 8: They're just not moving in that direction. 454 00:23:40,400 --> 00:23:43,600 Speaker 9: And if they do those trade deals will take years 455 00:23:43,760 --> 00:23:46,400 Speaker 9: months to negotiate, just like they did in his first term, 456 00:23:46,760 --> 00:23:49,720 Speaker 9: So any kind of deal of magnitude is months away. 457 00:23:49,800 --> 00:23:52,199 Speaker 9: South Korea is the one that I think Howard Lutnik 458 00:23:52,320 --> 00:23:54,520 Speaker 9: is referencing when he says a deal could be reached soon, 459 00:23:55,080 --> 00:23:56,200 Speaker 9: referencing last week. 460 00:23:56,520 --> 00:23:58,760 Speaker 8: They don't even have an administration, they don't have a president. 461 00:23:58,840 --> 00:24:01,440 Speaker 9: So negotiating and reaching a deal with South Korea, which 462 00:24:01,480 --> 00:24:03,200 Speaker 9: by the way, we already have a free trade agreement 463 00:24:03,280 --> 00:24:05,159 Speaker 9: with and ninety five percent of the goods coming in 464 00:24:05,240 --> 00:24:07,359 Speaker 9: are tireff at zero percent rates is not going to 465 00:24:07,400 --> 00:24:10,159 Speaker 9: move the needle. And then I think compounding all these 466 00:24:10,200 --> 00:24:12,159 Speaker 9: issues is the very real reality that now we have 467 00:24:12,240 --> 00:24:15,240 Speaker 9: twenty five percent tariffs on automobiles and parts. I don't 468 00:24:15,280 --> 00:24:16,880 Speaker 9: know about you, but I got to go and get 469 00:24:16,960 --> 00:24:19,320 Speaker 9: a new engine and four tires. I might not need 470 00:24:19,400 --> 00:24:21,679 Speaker 9: twenty dollars, but last time I checked, I do require 471 00:24:21,760 --> 00:24:23,840 Speaker 9: four tires on my car. So that's going to all 472 00:24:23,920 --> 00:24:26,479 Speaker 9: be more expensive when I go on Wednesday to get 473 00:24:26,520 --> 00:24:26,920 Speaker 9: that done. 474 00:24:27,320 --> 00:24:30,840 Speaker 6: Exemptions, tariff exemptions, You've got to know that sort of 475 00:24:30,960 --> 00:24:34,159 Speaker 6: go fund me there is you always do you you 476 00:24:34,160 --> 00:24:36,600 Speaker 6: don't always you know, Look we're not driving. 477 00:24:37,200 --> 00:24:38,200 Speaker 3: We're not driving much. 478 00:24:38,840 --> 00:24:40,480 Speaker 6: Do you always need to get four new tires? 479 00:24:41,000 --> 00:24:42,560 Speaker 3: Yes, that's the way, Well, that's the way it works. 480 00:24:42,600 --> 00:24:44,240 Speaker 3: That's a weird little man, is correct. 481 00:24:44,280 --> 00:24:47,280 Speaker 6: You can't Okay, continue, Henrietta, you've got a new note 482 00:24:47,280 --> 00:24:49,200 Speaker 6: oubt It says it's beginning to look a lot like COVID. 483 00:24:49,240 --> 00:24:52,480 Speaker 6: In the context of these tariff exemptions industries you mentioned 484 00:24:52,560 --> 00:24:56,040 Speaker 6: toy importers, retailers, big box retailers. How are you looking 485 00:24:56,119 --> 00:24:59,160 Speaker 6: at the interest groups in Washington? What's been happening, who's 486 00:24:59,200 --> 00:24:59,960 Speaker 6: had the president's ear? 487 00:25:02,359 --> 00:25:05,160 Speaker 9: So interest groups are fanned out across the hill trying 488 00:25:05,200 --> 00:25:07,440 Speaker 9: to talk to any member that they can, when really 489 00:25:07,480 --> 00:25:08,840 Speaker 9: they need to get into the White House. And this 490 00:25:08,920 --> 00:25:12,920 Speaker 9: has been a pervasive problem for House and Senate members. 491 00:25:12,720 --> 00:25:15,920 Speaker 8: All year as they've been preparing for the presidents. 492 00:25:17,040 --> 00:25:19,720 Speaker 9: So they go members and constituents will go to their 493 00:25:20,160 --> 00:25:22,680 Speaker 9: local representative or their senator if they're able to get 494 00:25:22,680 --> 00:25:25,000 Speaker 9: a meeting, and then that senator has no recourse. There 495 00:25:25,040 --> 00:25:28,320 Speaker 9: are not sufficient staffers at USTR or Commerce or Treasury, 496 00:25:28,560 --> 00:25:30,080 Speaker 9: let alone an exclusions process. 497 00:25:30,119 --> 00:25:31,520 Speaker 8: So what that is actually done? 498 00:25:32,119 --> 00:25:33,960 Speaker 9: And now that we're into the tariff for and there 499 00:25:34,000 --> 00:25:36,159 Speaker 9: are tariffs on every nation at a minimum of ten 500 00:25:36,240 --> 00:25:39,160 Speaker 9: percent and a whole host of different product lines at. 501 00:25:39,119 --> 00:25:40,640 Speaker 8: Usually twenty five percent rates. 502 00:25:41,040 --> 00:25:48,800 Speaker 9: Is that those entities, those businesses, toymakers, footwear retailers, shippers, truckers, retailers, 503 00:25:49,320 --> 00:25:53,040 Speaker 9: they are now moving away from asking for an exclusion 504 00:25:53,119 --> 00:25:55,880 Speaker 9: because it's too late for that to now a bail out. 505 00:25:56,200 --> 00:25:58,480 Speaker 9: So one thing I would encourage folks to watch is 506 00:25:58,600 --> 00:26:01,480 Speaker 9: the upcoming tax build from Ways and Means. One of 507 00:26:01,480 --> 00:26:03,560 Speaker 9: the biggest revenue raisers that they have in there at 508 00:26:03,640 --> 00:26:07,119 Speaker 9: seventy billion dollars is an elimination of the employee retention 509 00:26:07,280 --> 00:26:10,280 Speaker 9: tax credit. Y'all remember that from COVID when everybody was 510 00:26:10,320 --> 00:26:14,880 Speaker 9: firing everybody, and we started paying businesses to keep people 511 00:26:14,960 --> 00:26:17,320 Speaker 9: on their payroll to stop the damage as we saw 512 00:26:17,400 --> 00:26:21,840 Speaker 9: a vaccine. Now Here, the employee retention tax credit is 513 00:26:22,000 --> 00:26:24,760 Speaker 9: slated for complete removal and pulling it. 514 00:26:24,760 --> 00:26:27,280 Speaker 8: Out of the system if it's maintained. That's your first 515 00:26:27,320 --> 00:26:28,400 Speaker 8: indication of a bailout. 516 00:26:29,040 --> 00:26:31,320 Speaker 5: Henrietta, I need you up in New York. I hope 517 00:26:31,320 --> 00:26:33,119 Speaker 5: you have real ID for May seventh. 518 00:26:33,280 --> 00:26:35,000 Speaker 3: Next time we have entered a trace and we're going 519 00:26:35,040 --> 00:26:39,720 Speaker 3: to talk about this real ID disaster. We're in Henrietta 520 00:26:39,800 --> 00:26:41,359 Speaker 3: trace Veda Partners. 521 00:26:46,800 --> 00:26:50,679 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 522 00:26:50,720 --> 00:26:53,760 Speaker 1: starting at seven am Eastern on Apple Corplay and Android 523 00:26:53,800 --> 00:26:56,760 Speaker 1: Auto with the Bloomberg Business app. You can also watch 524 00:26:56,880 --> 00:26:59,680 Speaker 1: us live every weekday on YouTube and always on the 525 00:26:59,720 --> 00:27:01,840 Speaker 1: blo Blomberg Terminal Newspapers. 526 00:27:01,880 --> 00:27:03,879 Speaker 3: Today, Lisa Manteo, what do you go? We do? 527 00:27:04,000 --> 00:27:06,119 Speaker 10: Okay, So we've been talking about President trumpright wanting to 528 00:27:06,160 --> 00:27:08,920 Speaker 10: impose that one hundred percent tariffs on films produced overseas. 529 00:27:09,240 --> 00:27:12,120 Speaker 10: So screen Time Lukashaw has a really good look into 530 00:27:12,160 --> 00:27:13,800 Speaker 10: how it's going to impact Hollywood. 531 00:27:14,400 --> 00:27:15,440 Speaker 2: So he has a few things. 532 00:27:15,480 --> 00:27:18,000 Speaker 10: He says, there's few details. That's one of the issues. 533 00:27:18,040 --> 00:27:20,600 Speaker 10: It's not clear if the president wants to tax movies 534 00:27:20,640 --> 00:27:23,760 Speaker 10: that are shot overseas finished in the US, because that's 535 00:27:23,760 --> 00:27:26,120 Speaker 10: a whole different story, or if he plans a tax. 536 00:27:26,200 --> 00:27:30,160 Speaker 10: TV show has made overseas for international audiences but available 537 00:27:30,160 --> 00:27:32,760 Speaker 10: in the US, and that's huge for Netflix companies like Netflix. 538 00:27:33,400 --> 00:27:35,760 Speaker 10: So he says a lot of producers and executives they 539 00:27:36,000 --> 00:27:38,000 Speaker 10: just want to shoot more in the US, but it's 540 00:27:38,040 --> 00:27:39,160 Speaker 10: a little bit more expensive. 541 00:27:39,240 --> 00:27:40,560 Speaker 2: So that's the whole point. 542 00:27:40,640 --> 00:27:42,800 Speaker 10: You talk Tom about John Boyd going to mar A 543 00:27:42,880 --> 00:27:47,240 Speaker 10: Lago and talking about different federal incentives. But he goes 544 00:27:47,280 --> 00:27:50,800 Speaker 10: into how the entertainment industry still exports three times as 545 00:27:50,920 --> 00:27:53,720 Speaker 10: much as it imports, so Hollywood is really making a 546 00:27:53,760 --> 00:27:56,200 Speaker 10: lot of money exporting its product all over the world. 547 00:27:56,640 --> 00:27:58,200 Speaker 10: So he kind of breaks it down in that way. 548 00:27:58,480 --> 00:28:00,320 Speaker 3: I thought that note was great. Lucas put it out 549 00:28:00,520 --> 00:28:03,840 Speaker 3: late late last night with this uproar, and like you say, 550 00:28:04,040 --> 00:28:06,359 Speaker 3: it's a surplus business. This is like the least of 551 00:28:06,440 --> 00:28:09,280 Speaker 3: our headaches, and yet that's what we're worried about. Yeah, 552 00:28:09,359 --> 00:28:11,160 Speaker 3: and I get autos is a headache. 553 00:28:11,200 --> 00:28:14,280 Speaker 5: I get that, but movies at the end of the 554 00:28:14,400 --> 00:28:15,080 Speaker 5: day really isn't. 555 00:28:15,320 --> 00:28:18,280 Speaker 10: Yeah, and you have streaming like Netflix or Disney Amazon. 556 00:28:18,400 --> 00:28:21,440 Speaker 10: They produce shows for global audiences dozens of markets, so 557 00:28:21,680 --> 00:28:24,560 Speaker 10: it's it's a big deal for falsesimalss. 558 00:28:24,720 --> 00:28:26,399 Speaker 5: Streaming makes money. I still don't get it. 559 00:28:26,440 --> 00:28:29,399 Speaker 6: If your Netflix it makes money. Yeah, Yeah, I just 560 00:28:29,480 --> 00:28:31,200 Speaker 6: don't get I think the lawyers are going to be 561 00:28:31,240 --> 00:28:31,960 Speaker 6: busy with this one. 562 00:28:32,400 --> 00:28:35,000 Speaker 3: They're a little busy right now. Yes, So leaves with 563 00:28:35,080 --> 00:28:36,560 Speaker 3: that court case over the weekend too. 564 00:28:36,680 --> 00:28:38,680 Speaker 5: On the law firms least, So what are you got next? 565 00:28:39,240 --> 00:28:40,840 Speaker 10: So this is an interesting one from the Wall Street 566 00:28:40,880 --> 00:28:44,640 Speaker 10: Journal talking about how corporate America is leaving more jobs unfulfilled. 567 00:28:45,080 --> 00:28:47,520 Speaker 10: They're not laying off of workers, but the trade war 568 00:28:47,600 --> 00:28:49,920 Speaker 10: has them just pausing hiring. So they're saying it's this 569 00:28:50,080 --> 00:28:52,600 Speaker 10: new approach you hire less or not at all. So 570 00:28:52,680 --> 00:28:56,040 Speaker 10: they can point out companies like Jet Blue, t rowe Price. 571 00:28:56,560 --> 00:29:00,240 Speaker 10: They say jobs advertise on indeed down one person in 572 00:29:00,280 --> 00:29:02,920 Speaker 10: the past two weeks, so they're showing how people are 573 00:29:03,000 --> 00:29:04,640 Speaker 10: hiring lit. But me, while you had the report on 574 00:29:04,720 --> 00:29:07,520 Speaker 10: Friday that was a surprisingly strong number. 575 00:29:07,680 --> 00:29:09,800 Speaker 3: It was strong, but it was at the same time 576 00:29:09,880 --> 00:29:11,760 Speaker 3: with revisions. It was done for like one hundred and 577 00:29:11,840 --> 00:29:14,600 Speaker 3: nineteen thousand and again. You know, we'll see that. 578 00:29:15,640 --> 00:29:18,000 Speaker 5: I said this tim six weeks ago. 579 00:29:18,080 --> 00:29:20,840 Speaker 3: I said may seconds important, but June seventh or June 580 00:29:20,920 --> 00:29:23,400 Speaker 3: sixth is the next jobs report. To me, it has 581 00:29:23,480 --> 00:29:24,440 Speaker 3: way way more important. 582 00:29:24,520 --> 00:29:26,160 Speaker 6: Yeah, you got also wonder how the Fed is looking 583 00:29:26,200 --> 00:29:28,360 Speaker 6: at things this week. Set to start their meeting tomorrow. 584 00:29:28,640 --> 00:29:32,440 Speaker 6: We'll hear from Jay Powell on Wednesday. Any labor market 585 00:29:32,480 --> 00:29:34,560 Speaker 6: commentary obviously will be closely watched. 586 00:29:35,160 --> 00:29:37,400 Speaker 3: I think his goals to get through it in that 587 00:29:37,520 --> 00:29:38,240 Speaker 3: one piece. 588 00:29:38,080 --> 00:29:39,680 Speaker 10: Give us one more least, all right, So we're talking 589 00:29:39,680 --> 00:29:43,320 Speaker 10: about AI and how could replace certain jobs. This was 590 00:29:43,360 --> 00:29:45,360 Speaker 10: an interesting one from the Financial Times. It says an 591 00:29:45,400 --> 00:29:48,920 Speaker 10: AI law firm in Europe could be replacing some real 592 00:29:49,520 --> 00:29:53,320 Speaker 10: life lawyers. So it's a company called Garfield AI. They 593 00:29:53,400 --> 00:29:57,040 Speaker 10: recently got approval. They were founded by this former London 594 00:29:57,120 --> 00:30:00,880 Speaker 10: litigator quantum physicist. And what they do is there mainly 595 00:30:00,960 --> 00:30:03,680 Speaker 10: for small claims courts, but they do it for people 596 00:30:03,840 --> 00:30:06,360 Speaker 10: on the cheap. So they create like a quote polite 597 00:30:06,520 --> 00:30:09,960 Speaker 10: chaser letter for just over two dollars, filing documents for 598 00:30:10,040 --> 00:30:12,160 Speaker 10: claims for just over sixty five dollars and this is 599 00:30:12,320 --> 00:30:17,160 Speaker 10: all AI. The founder says he will review things to 600 00:30:17,280 --> 00:30:20,760 Speaker 10: make sure that everything is complete and is in check. 601 00:30:21,560 --> 00:30:23,760 Speaker 10: But it just points at this different trend of how 602 00:30:24,080 --> 00:30:28,120 Speaker 10: AI can step into different sectors like law, finance, different 603 00:30:28,160 --> 00:30:29,440 Speaker 10: area they going to replace us. 604 00:30:29,520 --> 00:30:30,120 Speaker 3: I don't think so. 605 00:30:30,640 --> 00:30:34,040 Speaker 6: It impossible, Tom, There is no replacement. 606 00:30:34,080 --> 00:30:36,600 Speaker 2: There is no replace, There is no the personality. 607 00:30:36,840 --> 00:30:39,120 Speaker 3: Thank you, have you used any of this stuff? Guys? 608 00:30:39,600 --> 00:30:41,880 Speaker 3: How do you give you? Yeah? Take quite a bit. 609 00:30:42,480 --> 00:30:45,560 Speaker 3: Wisenthal really did a survey of it, like he lose 610 00:30:45,640 --> 00:30:49,400 Speaker 3: like four or five, six of them. And I've heard 611 00:30:50,000 --> 00:30:52,760 Speaker 3: Jenini is getting a buzz YEP with Google YEP, but 612 00:30:52,880 --> 00:30:54,920 Speaker 3: I haven't used I mean, I use them in the search, 613 00:30:55,720 --> 00:30:58,160 Speaker 3: and I've said I'm stumbling into it. 614 00:30:58,360 --> 00:31:01,320 Speaker 6: It's finally you can finally ask questions and get answers 615 00:31:01,400 --> 00:31:03,680 Speaker 6: like what search? What online search was supposed to be? 616 00:31:04,400 --> 00:31:09,000 Speaker 5: Okay for the newspapers today, Lisa Mateo, thank you so much. 617 00:31:09,520 --> 00:31:14,280 Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify, 618 00:31:14,440 --> 00:31:18,200 Speaker 1: and anywhere else you get your podcasts. Listen live each 619 00:31:18,280 --> 00:31:21,840 Speaker 1: weekday seven to ten am Easter and on Bloomberg dot com, 620 00:31:22,240 --> 00:31:26,000 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 621 00:31:26,360 --> 00:31:29,440 Speaker 1: You can also watch us live every weekday on YouTube 622 00:31:29,760 --> 00:31:31,719 Speaker 1: and always on the Bloomberg terminal.