Speaker 1: Yeah, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane.
Speaker 1: Daily we bring you insight from the best in economics, finance, investment,
Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,
Speaker 1: Bloomberg dot Com, and of course on the Bloomberg Paul.
Speaker 1: We've got to bring in an esteem guest to rap
Speaker 1: in the politics the international relations with the Marcus Carl
Speaker 1: Weinberg high frequency economics, with his work over the years
Speaker 1: O E, C, d I, m F debt workouts internationally,
Speaker 1: and of course would Lehman a couple of coffees ago
Speaker 1: as well. Carl, I'm gonna give you an opening salvo.
Speaker 1: Why should our American listeners care about these EU elections? Well,
Speaker 1: they really shouldn't care very much about these EU elections
Speaker 1: unless they happen to be investing in European bonds. And
Speaker 1: they're worried a little bit about Italy and the license
Speaker 1: that the Italian government might feel free to take. Now
Speaker 1: that the populists got a better reading on this go around,
Speaker 1: the m five star movement is out of it a
Speaker 1: little bit. The more sane league is in charge. They
Speaker 1: have a potential new partner, so maybe we'll see some
Speaker 1: challenges on the budget side from Italy and that could
Speaker 1: give the bond market a little bit of a shake.
Speaker 1: That's an investment opportunity for some futures negative five down
Speaker 1: futures negative fourteen. But the yields are the ten uere
Speaker 1: yield is two point to nine, yeah, and the ten
Speaker 1: year yield on bunds is minus fifteen basis points. That's
Speaker 1: an even more exciting story. You know. That's spread. It
Speaker 1: will be appealing to some uh and people will look
Speaker 1: into that, I'm sure. But at the other end of
Speaker 1: the curve, to me, the German story is what's exciting.
Speaker 1: We've been talking at high frequency Economics for a long
Speaker 1: time now about bun yields going negative, about the shortage
Speaker 1: of bunds in the market, about low and Asian risks
Speaker 1: in Germany despite a high a very low domestic unemployment
Speaker 1: rate because of the open borders and the low jobless
Speaker 1: rate in Europe, and this story is all coming together.
Speaker 1: It's a very exciting story. But negative Bonnils pods risks
Speaker 1: for the financial system, and that too is something American
Speaker 1: investors should be paying attention to. Well, car, what do
Speaker 1: you think the latest twist in the Brexit negotiations and
Speaker 1: the EU elections. What does that mean for Brexit in
Speaker 1: the European economy? And from your perspective, anything changed in
Speaker 1: the last several days. From your perspective, absolutely nothing. You know,
Speaker 1: I don't really care who nothing, I don't really care
Speaker 1: who's Prime Minister. The parliamentary arithmetic isn't changed by any
Speaker 1: of this. We still have no majority in Parliament and
Speaker 1: therefore nothing can get done. I quoted to my high
Speaker 1: frequency economics leaders this weekend Abraham Lincoln, House divided against
Speaker 1: it how's divided against itself? Cannot stand and at the
Speaker 1: end of the day, it won't fall. But it has
Speaker 1: to be all one or all the other in order
Speaker 1: to persist. And that's where we are in Britain. I
Speaker 1: think the only way this will be resolved is through
Speaker 1: national elections and new government, and hopefully someone will win
Speaker 1: those elections and then we'll have a chance of getting
Speaker 1: something done on bregsit. How concerned should your readers our
Speaker 1: listeners be about some of the rising trade tensions over
Speaker 1: the last several weeks. How do you view that between
Speaker 1: US and China. Well, there's two aspects to that. The
Speaker 1: first is that any breaking on world trade through tariffs
Speaker 1: or trade restrictions or predatory commercial policy, that's all bad
Speaker 1: for world trade. And anything that's bad for world trade
Speaker 1: is bad for the world economy. Every time world trade
Speaker 1: growth dips, something bad happens to world GDP. The other
Speaker 1: side of the coin is that so far these this
Speaker 1: war is not all that large. If China lost all
Speaker 1: of its exports to the United States, all five hundred
Speaker 1: billion dollars worth, it would cost its GDP three and
Speaker 1: a half percent once and then it will go right
Speaker 1: back to growing again where it was before. And it's
Speaker 1: growing at six and a half percent. China, despite all
Speaker 1: the stuff you read about in the press, China is
Speaker 1: not in a recession of any kind. It's growing at
Speaker 1: six and three quarters percent. For goodness sake, It's doing
Speaker 1: quite strong enough to be able to withstand the shock.
Speaker 1: And of course China is not going to lose all
Speaker 1: of its trade with the US over this. It'll lose
Speaker 1: just the sliver of it. What is the power dynamic
Speaker 1: right now between Michigan Washington, the President comes back from Japan.
Speaker 1: We've seen all the back and forth, Carl, You're deeply
Speaker 1: experienced it. What is between the lies. Who has the
Speaker 1: upper hand? Right now, Let's see right now, as I
Speaker 1: remember from physics, what power is force times distance or
Speaker 1: something like that, and that implies that something is pushing
Speaker 1: against something else. And right now, nothing is happening, right
Speaker 1: nobody's pushing against anyone. But says, okay, wise guy, we're
Speaker 1: going to go to John Tucker. Can we go to
Speaker 1: Tony and mechanics this morning? Okay? Look, F equals g
Speaker 1: F equals g mm. Over our square the two ms
Speaker 1: of the moon and the sun. What's the mass right
Speaker 1: now of us blather versus the mass of Chinese silence?
Speaker 1: So that's right, it's exactly right. China won't talk. That's
Speaker 1: a very powerful force in an initiation. Alright. So so
Speaker 1: China right now says, we have our principles, and if
Speaker 1: you want to bide with these principles, we'd rather endure
Speaker 1: the pain of the tariffs to achieve our goals, which
Speaker 1: are modernization and development on our plan. And the Trump
Speaker 1: administration is frustrated. So President Trump is doing what he
Speaker 1: has done frequently, what he did with Japan this weekend,
Speaker 1: what he's doing with China, which is he's saying, we're
Speaker 1: not ready to make a deal with China. All right,
Speaker 1: he's disengaging, right China. Beijing won't give President Trump a
Speaker 1: plank for his reelection platform by giving him a deal
Speaker 1: on trade. That's just where it is right now. And
Speaker 1: maybe the next administration, maybe the next Trump administration or whoever,
Speaker 1: will come in with a more conciliatory view and be
Speaker 1: willing to work with the Chinese, But this administration isn't
Speaker 1: in The Chinese aren't buying it. So you don't expect
Speaker 1: anything over the next year and a half meaningful between
Speaker 1: US and China. I don't think we'll see any agreement.
Speaker 1: You know, we may even even just kind of a
Speaker 1: headline agreement to kind of get it all off the table. Well,
Speaker 1: the Chinese have drawn a red line in the sand.
Speaker 1: They said any agreement must include the immediate elimination of
Speaker 1: all tariffs, and that just ain't going to happen out
Speaker 1: of this current administration team because people on that team
Speaker 1: believe incorrectly that the tarifts are exerting an unbearable force
Speaker 1: on the Chinese economy. And that's not the case. This
Speaker 1: is uh a thirteen fourteen trillion dollar economy, and you're
Speaker 1: threatening it with a tax that we're paying on five
Speaker 1: billion dollars worth of goods that they produce that they
Speaker 1: can easily sell to somebody else. Right, there's no unbearable
Speaker 1: force at work here? Well, I can't. This physics is
Speaker 1: killing me. I feel like it's Sisan Zamanski a few
Speaker 1: years ago. Okay, if there's an unbearable force, something clears,
Speaker 1: there's a leakage. There's a leakage within the system, and
Speaker 1: that is the currency market. Do you have optimism that
Speaker 1: currency markets could compensate for mistakes made along the way
Speaker 1: in trade? Well, you know, there are different there can
Speaker 1: be different views as to where the mistakes are. But
Speaker 1: I believe that the Chinese should not be How should
Speaker 1: I say this? We shouldn't deny the risk that China
Speaker 1: will pursue a devaluation of the yuan against the dollar
Speaker 1: while maintaining its value against its baskets. It's referenced basket
Speaker 1: and currencies as a way of offsetting the impact of
Speaker 1: these tariffs, and that's what we're seeing right now. The
Speaker 1: trade weighted basket is flat and the yuan is depreciating
Speaker 1: against the dollar. And this is a perfect storm for
Speaker 1: the Chinese because every percent that the yuan falls against
Speaker 1: the dollar. That's less of a burden that the tariffs
Speaker 1: impose on the prices of goods that are traded. Physics
Speaker 1: with Carl Weinberg. There it is Tuesday morning, to get
Speaker 1: your expomoral day started. Carl, thank you so much, great,
Speaker 1: We appreciate it. It has been a weekend of tumul,
Speaker 1: particularly for Europe. I guess we knew it. It was
Speaker 1: all news, but nevertheless there are significant reactions as well.
Speaker 1: So let's go a little i R here with negative
Speaker 1: interest rates every more negative in Europe, the Swiss to
Speaker 1: the year uh now a negative rate again that record lows,
Speaker 1: but nevertheless there and we can synthesize all this and
Speaker 1: what it means for Marcus A. Jacob Kirk guard with
Speaker 1: the Peterson Institute, a senior fellow. But that very uh
Speaker 1: just barely, I should say, describes how he thought about
Speaker 1: Europe and what it means for America in all just
Speaker 1: all sorts of ways to go here, including his work
Speaker 1: at our house in Denmark in his book Transforming the
Speaker 1: European Economy. Jacob, let me ask an open question to begin,
Speaker 1: what is your unique insight of what we saw in
Speaker 1: these EU elections. What I think, first of all, we
Speaker 1: should be clear that what it's in some way it's
Speaker 1: actually signaled was the birth of European democracy, because I
Speaker 1: think it was the first time you've ever had a
Speaker 1: European election, which is really kind of twenty eight different
Speaker 1: elections in member states, yeah, really synthesized into more of
Speaker 1: a single on and it was really an election that
Speaker 1: was about, uh, do you want the far right uh
Speaker 1: to march onwards ever stronger? And I think what we
Speaker 1: did see was that participation in these elections were about
Speaker 1: ten percent uh, and therefore we did not see uh,
Speaker 1: anything like uh you know, we basically had a lot
Speaker 1: of people turning out against that. And I think that's
Speaker 1: really the main story. And then there's a lot of
Speaker 1: implications for different individual countries, but this is the big story,
Speaker 1: and I bring it over to and I think if
Speaker 1: your Adam posing at Peterson Institute, the need to provide
Speaker 1: fiscal liquidity into a system with imploding interest rates. All
Speaker 1: of our conversations at Bloomberg Surveillance today, is it's still
Speaker 1: an austere Europe? Is it still austerity across Europe and
Speaker 1: particularly Germany? I would say much less so actually, because
Speaker 1: one thing we did see is the one major breakthrough
Speaker 1: that the far right had was in Italy, where Salvini
Speaker 1: one big and he's certainly going to propose tax cuts
Speaker 1: and more fiscal spending. And even in Germany when you
Speaker 1: look at the German fiscal impulse this year, it's going
Speaker 1: to be positive to the tune of zero point seven
Speaker 1: to zero point eight percent of GDP. And obviously McCall
Speaker 1: in France, who actually, when you look closer at the results,
Speaker 1: did quite well even if he didn't beat Marine Lepin.
Speaker 1: UH is also, of course UH promoting fiscal UH stimulus.
Speaker 1: So I would say that this is not two thousand
Speaker 1: and twelve. This is Europe in some ways reaping the
Speaker 1: benefits of perhaps the policy mistakes that were made UH
Speaker 1: six or seven years ago, by spending some of that
Speaker 1: fiscal space that the continent has. So, Jacob, what are
Speaker 1: these elections mean for the Brexit process in the near too,
Speaker 1: let's say, intermediate term? Well, I think the UK is
Speaker 1: a classic example of how these elections have really shuffled
Speaker 1: the national political circumstances in members dates because what we
Speaker 1: have already seen. What we saw, of course, was that
Speaker 1: the Labor Party lost almost as much as the Conservative
Speaker 1: Party did to the Brexit, to Farage's Brexit Party, and
Speaker 1: Corbin has already been, if you like, absorbing the consequences
Speaker 1: of that loss to the Liberal Democrats and is moving
Speaker 1: ever more explicitly into backing a second referendum on Brexit. UM.
Speaker 1: And if that happens, UH, then I think you basically
Speaker 1: have a totally bifurcated outlook for the UK. Either you
Speaker 1: have a no deal Brexit or you have no Brexit
Speaker 1: at all. And it really comes down to what the
Speaker 1: majority in the current British Parliament UH will do. And
Speaker 1: then of course who would be the next leader of
Speaker 1: the Conservative Party. But there has been this is already
Speaker 1: a massive in fact on the UK. So again give
Speaker 1: us your sense of you mentioned a second referendum. There's
Speaker 1: those that are saying to you, we're at the point
Speaker 1: now where this might be you know, really the only
Speaker 1: way to go. Do you think that the second referendum
Speaker 1: is on the table? Oh? I think it's very much
Speaker 1: on the table. I think if you look at the
Speaker 1: outcome of each elections, I think you will see that
Speaker 1: parties that were explicitly in favor of a second referendum
Speaker 1: one almost as much as the Conservatives and the Brexit
Speaker 1: Party combined and the switch vote if you like. It's
Speaker 1: basically the Labor Party. And you have seen senior Labor officials,
Speaker 1: including Jeremy Corbyn himself, actually come out and say, well, actually,
Speaker 1: if we don't do this, we're going to be killed
Speaker 1: by the Liberal of Democrats in the next UK general election. Jacob,
Speaker 1: give us a broader picture here in the next few minutes.
Speaker 1: I mean, we go from Conrad at an hour just
Speaker 1: to use Germany as a model, a helmet older Schroeder Americle, etcetera.
Speaker 1: What's the next for Jacob Kirkgard across Europe? I mean,
Speaker 1: what's what's the next wave in the conservative liberal battle
Speaker 1: nation to nation in Europe? And frankly you can drag
Speaker 1: America into it as well. Folks. What do you see
Speaker 1: as the next political continuum? Well, I think that the
Speaker 1: first big battle within having Europe is going to be
Speaker 1: all about who takes the big jobs that are becoming
Speaker 1: vacant at the presidency of the European Commission and the
Speaker 1: European Central Bank, etcetera. That's gonna be a big showdown
Speaker 1: between predominantly France and Germany. Um, and so far, based
Speaker 1: on these elections, I'd say it's as Mt Cole Uh.
Speaker 1: I think he gets to choose which are the two
Speaker 1: jobs he wants, uh basically, and I think he probably
Speaker 1: will choose the Commission, which means that I am personally
Speaker 1: uh thinking that proba probably since one of the effects
Speaker 1: of the increased participation in the European ar is that
Speaker 1: the uh you know, the the legitimacy of the Switzman
Speaker 1: process is much in hunt. So I might bet for
Speaker 1: those jobs will be probably west Ager for Commission president
Speaker 1: and Jan Spiderman at the CD. I think that's just
Speaker 1: ever more likely. Does he have to go out and
Speaker 1: get other nations to join him in voting or his
Speaker 1: friends just dictate what they want? Oh no, no, no,
Speaker 1: he's actively courting other count uh. He you know, he
Speaker 1: had dinner yesterday with the socialist uh premier of Spain.
Speaker 1: He has been talking to a lot of different countries.
Speaker 1: So no, no no, no, he's like actively campaigning among the
Speaker 1: other leaders, also attracting more parties to his new Liberal
Speaker 1: grouping in the europe In Parliament. So he's still very
Speaker 1: much on the campaign trail. Whereas you know quite Frankly,
Speaker 1: Angela Marchol, whose party obviously didn't do very well in Germany,
Speaker 1: is in my opinion, clearly of the defensive UH following
Speaker 1: almost a clear Green victory in the German elections. I mean,
Speaker 1: he's probably getting the Eiffel Tower tickets and the restaurant there,
Speaker 1: you know, way up. You know, I think it's impossible.
Speaker 1: I haven't been there. I I we tried to get in,
Speaker 1: you know, I tried. Francine pulled every string. She couldn't Okay,
Speaker 1: you know, I couldn't get a Jacob Kirkgard, Thank you
Speaker 1: so much, just really well time, thrilled to have you
Speaker 1: with us, with the Peterson and so go to their website.
Speaker 1: Just really really trenched stuff on EU and and how
Speaker 1: it redounds back to the United States as well. Lindsay
Speaker 1: Pigs with us was still she joins us right now, Lindsay,
Speaker 1: it's a border of economic data. What are you focused
Speaker 1: on this week? Well, I think the biggest focus will
Speaker 1: be GP. I think the Street is going to really
Speaker 1: hone in on whether or not we see a sizeable
Speaker 1: revision to the start of the year. I don't expect
Speaker 1: we will. I I do think we'll see maybe a
Speaker 1: tenth or two shaved off of that top line number,
Speaker 1: but it really leaves the thesis in place, meaning that
Speaker 1: growth exceeded expectations at the start of the year, setting
Speaker 1: the bar high. But when we start to look at
Speaker 1: the data leading into the second quarter, does appear to
Speaker 1: be a very short lived above trend positions. Okay, link
Speaker 1: what you just said in the consumer confidence which we're
Speaker 1: going to get a snapshot of today and into what
Speaker 1: we actually see with consumers spending. I mean, does it
Speaker 1: all dovetail nicely together? No, it doesn't. It used to
Speaker 1: before back in the day when we looked to consumer
Speaker 1: confidence and it was strong that generally translated into very
Speaker 1: robust pssessing duck numbers. We saw retail sales very solid.
Speaker 1: This time around, we continue to hear that the consumer
Speaker 1: is confident, that they're feeling good, but their actions aren't
Speaker 1: matching positive sentiments. And in fact, we've seen retail sales
Speaker 1: now trend negative for three of the last five months,
Speaker 1: despite the fact that confident is at multi year highs.
Speaker 1: So the consumer is saying one thing but doing quite another.
Speaker 1: So lyndsay, would you is it your opinion that the
Speaker 1: FED has done a relatively admiral job and kind of
Speaker 1: engineering kind of what can be characterized as a soft
Speaker 1: landing growth, still decent inflation, low consumer generally hanging in there.
Speaker 1: Is that your your take the moment. I think the
Speaker 1: Fed has done a very good job. I do think
Speaker 1: that they got a little over their skis last year.
Speaker 1: They got a little too aggressive with rate hikes. We
Speaker 1: could have done without the fourth, certainly the fourth, maybe
Speaker 1: even the third last year. As we see now from
Speaker 1: market fundamentals that the Fed has pushed beyond neutral and
Speaker 1: I mean the inversion, the partial inversion of the yield curve.
Speaker 1: At this point, we do need a rate cut, if
Speaker 1: not to rate cut, just to right to the slope
Speaker 1: of the yield curve, let alone, start to give back
Speaker 1: some of that accommodation to the market to ensure that
Speaker 1: we do soften the blow from the weakness as we
Speaker 1: expect going further into so, lindsay, in the first quarter
Speaker 1: earnings calls, you know, we started to hear more and more,
Speaker 1: particularly from the retailers, just kind of saying, hey, the
Speaker 1: trade tensions that are out there that are mounting. Um,
Speaker 1: it's not necessarily a big issue now, but it's certainly
Speaker 1: could very well be in the later part of the year.
Speaker 1: How concerned are you that trade tensions are the lack
Speaker 1: of any resolution can weigh on the consumer way on
Speaker 1: the economy. Oh absolutely. Now, when we talk about the
Speaker 1: tears already implemented, so we look at late into we
Speaker 1: estimate the tear of shaved off about two tens of
Speaker 1: a percentage point from GDP. It's so not a significant amount,
Speaker 1: but as we look out beyond and we expect momentum
Speaker 1: to wane in terms of top line funny missals, those
Speaker 1: tents of a percentage point will add up. Now we
Speaker 1: talk about heightened level of tariffs as well as the
Speaker 1: threat of an additional round of love is possibly placed
Speaker 1: in a course Chinese retaliatory action. This is going to
Speaker 1: compound that negative impact on the economy For businesses. We
Speaker 1: hear that many at ten percent were able to eat
Speaker 1: that that cost increase and not pass that on the
Speaker 1: consumer at This is going to be increasingly difficult. Now again,
Speaker 1: businesses may not be able to pass that directly on
Speaker 1: the consumers without the risk of losing market share, but
Speaker 1: that means that internally they're going to have to find
Speaker 1: efficiencies and cost reductions, which is likely to translate into
Speaker 1: income and wage cuts, which again will filter into the
Speaker 1: economy and indirectly hit the consumer. Lindsay thank you so
Speaker 1: much as we can started an economic week and again, uh,
Speaker 1: plethora is there? Is that the right Wordlethora of data
Speaker 1: coming out later in the week, a real snapshot into
Speaker 1: the market, and the right to June and those critical
Speaker 1: I S M numbers as well. There's medicine, there's politics,
Speaker 1: There's all the big issues we talked about every day.
Speaker 1: But no one, and I mean no one, has had
Speaker 1: more effect on families in America than our next guest.
Speaker 1: His name is Brian Kelly. I don't know what he did.
Speaker 1: He was on Wall Street doing something to various and
Speaker 1: he set up a website called The Points Guy to
Speaker 1: talk about bank cards and frequent flyer miles and change
Speaker 1: the language and action of every one of us. Mr
Speaker 1: Kelly joins us. Now, Brian, I want to say thank
Speaker 1: you again and and just all you've done to make
Speaker 1: us travel maybe more reasonable. Let's get out of the
Speaker 1: way the tension between the airlines and the banks right now,
Speaker 1: what do the banks want in the next twenty four
Speaker 1: months from the airlines, and what do the airlines want
Speaker 1: in the next twenty four months from all these charge cards. Well,
Speaker 1: it's interesting. Delta and m X actually just re up
Speaker 1: their relationship for the next five years, so we can
Speaker 1: probably expect to see some new bonuses and even some
Speaker 1: new credit cards. You know, the banks and the airlines
Speaker 1: have a pretty cozy relationship. The frequent flyer programs are
Speaker 1: huge profit centers, so for for for the airlines, the
Speaker 1: airlines sell billions of dollars worth of miles to the
Speaker 1: credit card companies, and then of course the credit card
Speaker 1: companies make a whole ton of money, you know, every
Speaker 1: time people swipe their cards on the transactions, so it's
Speaker 1: a pretty profitable ecosystem for everyone. I want to go
Speaker 1: to your Scott Clark who wrote a brilliant small article
Speaker 1: on Air New Zealand in Auckland and buried in it.
Speaker 1: Brian Kelly is the future I see, which is nobody
Speaker 1: wants to fly economy but they can't afford business class
Speaker 1: and first class is dead. Tell us about all these
Speaker 1: new levels to get me out of economy. Well, the
Speaker 1: big thing is premium economy. Um. The US airlines, you know,
Speaker 1: the three major US airlines. They used to have fake
Speaker 1: premium economy where it was basically just a coach seat
Speaker 1: with a little bit of extra records. I know that
Speaker 1: I could say this so because Sweeney's six ft three,
Speaker 1: Brian Kelly's like six seven, and then there's me. But
Speaker 1: the airline is now Delta, United and American all have
Speaker 1: real true premium economy that that's rolled out with over
Speaker 1: the last year, and they're making a ton of money
Speaker 1: off of it. That they're yielding twice as much from
Speaker 1: premium economy than they are traditional economy because air fares
Speaker 1: are still really cheap an economy with so many low
Speaker 1: cost carriers. So I think the sweet spot for the
Speaker 1: US airlines is on the premium economy and charging a
Speaker 1: premium for their you know, the business class suites that
Speaker 1: we've seen Delta roll out with. So Brian is as
Speaker 1: much as I love spending my summers on the Jersey Shore,
Speaker 1: I think I want to go to Europe this summer.
Speaker 1: Where's the where where do I go? What's the cheapest
Speaker 1: place to go? Well, Norwegian Era is probably you know,
Speaker 1: I would look at where Norwegian is flying their their
Speaker 1: fares are really really low, even for last minute travel. Now,
Speaker 1: the traditional airlines, you know, no matter where you go, UM,
Speaker 1: they charge for international flights. You want to be booking
Speaker 1: at least eight weeks in advance for international. So if
Speaker 1: you're looking ready for July four, you may be bumping
Speaker 1: up against some really expensive fares. UM. But yeah, I
Speaker 1: mean I would I would either use your frequent flyer miles,
Speaker 1: see where the cheapest places that you can go. UM.
Speaker 1: Some of the airlines like American now have routes to
Speaker 1: UM Bologna and some other you know, abruptn of Croatia,
Speaker 1: And on those routes that aren't selling very well, you
Speaker 1: may be able to use your frequent flyer miles for
Speaker 1: the cheapest amount possible. So I would say be flexible.
Speaker 1: Check Norwegian, check your frequent flyer miles. There's there are
Speaker 1: deals out there, but you need to sniff them out.
Speaker 1: Visiting on the Bloomberg terminal today, there's a story out
Speaker 1: there entitled a Rough Summer awaits travelers facing fewer flights
Speaker 1: and t s A staff. Do you think that's gonna
Speaker 1: an issue? You know, I think the t s A
Speaker 1: you know, since the shutdown resumed, I personally, I mean
Speaker 1: I have pre check and I flight once twice three
Speaker 1: times a week, and pre check for me has been
Speaker 1: pretty good. And even I always checked the normal lanes.
Speaker 1: I don't see it being that bad. What I will
Speaker 1: say is this summer there's gonna be record travelers. It's
Speaker 1: all about choosing the right flight time. So we did
Speaker 1: an analysis of millions of lights, and flights that leave
Speaker 1: at seven am have a nine chance of leaving and
Speaker 1: arriving on time or early. So, you know, especially in
Speaker 1: the New York City airports where air traffic control backs up,
Speaker 1: I highly recommend seven, eight, nine and ten am flights
Speaker 1: will get you to where you're going on time statistically
Speaker 1: the most. And does that included new or Newark and
Speaker 1: Newark as well? Yeah? New Work is actually the best
Speaker 1: of those three. So you know, we were talking about
Speaker 1: slicing and dicing of the seats. I mean, I remember day.
Speaker 1: You know it's this economy in first class. Are we
Speaker 1: going to get to the point where they're almost selling
Speaker 1: rows and individual seats because at point when you go
Speaker 1: in to kind of pick a seat, it's a lot
Speaker 1: more complicated than you used to be. Well, it's interesting
Speaker 1: on upon Airways that they just added their sky couch
Speaker 1: as well. Air New Zealand has that where you can
Speaker 1: actually buy a pad that you put over the three
Speaker 1: seats and economy and you can lay down kind of
Speaker 1: like the poor man's business class. But it's they're actually
Speaker 1: doing really well and they're selling a premium too, so
Speaker 1: you and if you have kids, you can kind of
Speaker 1: lay out in economy because yeah, things are really tight
Speaker 1: in the back of the bus. The economy is not
Speaker 1: economy anymore. And some of these flights, I mean, how
Speaker 1: does you know in this case British Air went in
Speaker 1: full disclosure folks when the Gulf stream doesn't work. I'm
Speaker 1: on b A, but but you know, how do they
Speaker 1: get away with sixteen hundred twelve dollars for an economy seat?
Speaker 1: And they get away with it because somebody's buying it, right,
Speaker 1: someone's buying it and people That's why I say check
Speaker 1: Norwegian Air. Norwegian on the same flights to London last
Speaker 1: minute I had to buy and it's you know, their
Speaker 1: premium products, you know, seven dollars last minute one way
Speaker 1: British Airways in the major carriers, if you buy a
Speaker 1: one way ticket or if you're buying a last minute
Speaker 1: they gouge you because they know, you know, they're hoping
Speaker 1: to get the business travelers whose corporate departments will pay
Speaker 1: whatever fee, and they're not going to put them on Norwegian,
Speaker 1: but truly Norwegian and Economy with free WiFi. It's a
Speaker 1: seven eighties seven newer plane. It's actually a better experience.
Speaker 1: So I know, I'm the points guy. I'm all about,
Speaker 1: you know, get points. You know, if you're an American
Speaker 1: frequent flyer, you may want to get your b A
Speaker 1: you know, credit for the b A flight, but sometimes
Speaker 1: it's just not worth it, especially when you're paying double
Speaker 1: or triple the price for Economy. It's not that much different.
Speaker 1: What are some of the popular destinations this summer that
Speaker 1: you're seeing? There're anything unusual that people were just saying, Hey,
Speaker 1: this is a new place to go. You know, I
Speaker 1: think Iceland's dying down a little bit, especially since Waware collapsed,
Speaker 1: although we still see huge demand there. Um and you know,
Speaker 1: the dollar is still relatively strong, so this this year,
Speaker 1: Europe is still a top destination for travelers. Um, but
Speaker 1: we're still seeing places like Croatia, um and uh, you know,
Speaker 1: Italy is still a really top destination. So there's nowhere
Speaker 1: off really off the wall that we're seeing, you know,
Speaker 1: all the top destinations in Europe. What's the trend you
Speaker 1: see Pacific? I mean we talk Atlantic here because we're
Speaker 1: based in New York, But what's the trend you see
Speaker 1: in Pacific this year for American listeners, Brian Kelly, Well,
Speaker 1: I mean for trends Pacific travel, we're seeing. Um. Actually,
Speaker 1: one of the interesting things we're seeing first class going
Speaker 1: away altogether. So airlines is getting rid of their first
Speaker 1: class UM. But interestingly there's a new low cost carrier
Speaker 1: coming out of Soul. The founder of Botox is starting
Speaker 1: his own airline, perfect for me. UM. So yeah, I
Speaker 1: think the similar thing that we've seen in the Transatlantic,
Speaker 1: with low cost carriers coming in, less of the first
Speaker 1: class and more. You know these these uh and even
Speaker 1: Catholic Pusific has gotten rid of first class in some flights,
Speaker 1: but you know, air fas are still really cheap. We're
Speaker 1: seeing Hong Kong Airlines has entered the market really strongly.
Speaker 1: We're seeing under five dollars you can go from the
Speaker 1: East Coast to Hong Kong. So even though you know
Speaker 1: it is a fit in the back of the bus,
Speaker 1: there are still amazing affairs out there, give us the
Speaker 1: sick first class fancy fancy Brian Kelly, Where you flew
Speaker 1: somewhere for twelve dollars? What's the latest, Brian Kelly in
Speaker 1: my book, So this is a tip I'll give you. Know.
Speaker 1: Whenever airlines announced new flights, whenever they put them up
Speaker 1: for sale, generally they're a really cheap Award miles tickets.
Speaker 1: So this fall Delta December twenty second, they start flying
Speaker 1: JFK to Mumbai and it's a you know, nine thousand
Speaker 1: dollar round trip flight, and I gotta I'm flying one
Speaker 1: way for a hundred thirty five thousand SNY miles, which
Speaker 1: if you use Delta miles to go New York to
Speaker 1: India in their Delta one suite is a screaming deal.
Speaker 1: So I was pretty proud of that one. But he's
Speaker 1: got to get back. Yeah, but you know, so you could.
Speaker 1: That's the beauty of miles that you can book one
Speaker 1: way on Delta. I'm actually gonna be going to the Maldives,
Speaker 1: so I'm gonna fly Emirates home from there because you know,
Speaker 1: we just we just wish we had his life. And
Speaker 1: I'll be on the guards. Brian Kelly go away. The
Speaker 1: points guy I can't say enough about. And of course
Speaker 1: one of the great charms of Brian Kelly is he
Speaker 1: is always said responsible use of charge cards, that is
Speaker 1: the way to go. He did that right from the beginning.
Speaker 1: Can't say enough about his impact. Thanks for listening to
Speaker 1: the Bloomberg Surveillance podcast. Subscribe and listen to interviews on
Speaker 1: Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. I'm
Speaker 1: on Twitter at Tom Keene before the podcast. You can
Speaker 1: always catch us worldwide. I'm Bloomberg Radio