1 00:00:00,080 --> 00:00:12,879 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. This is the Bloomberg 2 00:00:12,960 --> 00:00:16,960 Speaker 1: Surveillance Podcast. I'm Tom Keene along with Paul Sweeney. Join 3 00:00:17,079 --> 00:00:21,000 Speaker 1: us each day for insight from the best in economics, finance, investment, 4 00:00:21,200 --> 00:00:24,840 Speaker 1: and international relations. You can also watch the show live 5 00:00:25,079 --> 00:00:29,400 Speaker 1: on YouTube. Visit the Bloomberg Podcast channel on YouTube to 6 00:00:29,520 --> 00:00:32,920 Speaker 1: see the show weekday mornings from seven to ten am 7 00:00:32,960 --> 00:00:37,000 Speaker 1: Eastern from our global headquarters in New York City. Subscribe 8 00:00:37,000 --> 00:00:40,360 Speaker 1: to the podcast on Apple, Spotify, or anywhere else you 9 00:00:40,440 --> 00:00:44,600 Speaker 1: listen and always I'm Bloomberg Radio, the Bloomberg Terminal, and 10 00:00:44,640 --> 00:00:48,280 Speaker 1: the Bloomberg Business App. I can do this with Wendy Show. 11 00:00:48,280 --> 00:00:51,319 Speaker 1: She's at Brown University and she's been to every bar 12 00:00:51,440 --> 00:00:54,560 Speaker 1: every place it sells near against at lager Beer in 13 00:00:54,640 --> 00:00:57,360 Speaker 1: Rhode Island. And when I was thirty nine years old, 14 00:00:57,720 --> 00:00:59,240 Speaker 1: I mean two or three nights a week, I was 15 00:00:59,240 --> 00:01:02,480 Speaker 1: at Lupo's heart Break Hotel, really, and they served the 16 00:01:02,560 --> 00:01:07,240 Speaker 1: Meragansett and plastic cups. Professor Schuller nows this is way back. 17 00:01:07,360 --> 00:01:08,560 Speaker 1: I mean, you get it down on to the dark 18 00:01:08,640 --> 00:01:12,800 Speaker 1: side in Newport. Listen, you know, listen to the Blues 19 00:01:12,959 --> 00:01:17,160 Speaker 1: and RBQ and all that Wendy thirty nine years old. 20 00:01:17,360 --> 00:01:21,320 Speaker 1: I'm a vice presidential nominee. Is that too young? 21 00:01:23,440 --> 00:01:23,600 Speaker 2: No? 22 00:01:23,680 --> 00:01:25,080 Speaker 3: I mean I don't think it's too young. 23 00:01:25,240 --> 00:01:29,000 Speaker 4: I think he's navigated a political career after being a 24 00:01:29,440 --> 00:01:32,000 Speaker 4: Yale law school and I'm writing a bestseller. 25 00:01:32,319 --> 00:01:33,399 Speaker 3: I don't think it's too young. 26 00:01:33,440 --> 00:01:35,480 Speaker 4: I think that's one of the things that Americans are 27 00:01:35,520 --> 00:01:38,560 Speaker 4: looking for right, this big contrast between our older main 28 00:01:38,640 --> 00:01:42,440 Speaker 4: candidates and the vps being younger. I think William Jennings 29 00:01:42,440 --> 00:01:46,120 Speaker 4: Bryant would have enjoyed JD. Vance's speech Tom last night. 30 00:01:46,440 --> 00:01:50,120 Speaker 4: I mean it struck almost identical themes to eighteen ninety six. 31 00:01:50,160 --> 00:01:53,160 Speaker 4: I don't know if that should reassure people or make 32 00:01:53,200 --> 00:01:55,000 Speaker 4: them very frightened that we're going backwards. 33 00:01:55,120 --> 00:01:58,120 Speaker 3: But nonetheless, no, I don't think so at all. 34 00:01:58,720 --> 00:02:00,720 Speaker 4: I think that he's positioning self to be the heir 35 00:02:00,720 --> 00:02:02,200 Speaker 4: apparent before. 36 00:02:02,080 --> 00:02:04,840 Speaker 3: Trump even wins this election. So that's an interesting political 37 00:02:04,920 --> 00:02:06,360 Speaker 3: dynamic in the Republican Party. 38 00:02:06,440 --> 00:02:09,400 Speaker 1: Bill Clinton forty six and a half, George W. Bush 39 00:02:09,440 --> 00:02:13,519 Speaker 1: Bush the younger, fifty four and a half, President Obama 40 00:02:14,040 --> 00:02:16,400 Speaker 1: forty seven and a half. I guess the trends there. 41 00:02:16,760 --> 00:02:21,080 Speaker 1: We've been talking this morning, Professor Schiller about isolationism. What's 42 00:02:21,080 --> 00:02:24,560 Speaker 1: the character of the Trump vance isolationism. 43 00:02:25,720 --> 00:02:28,919 Speaker 4: Well, Trump has successfully pitched this in two ways. One is, 44 00:02:28,960 --> 00:02:33,399 Speaker 4: we get bad deals when we go into multi multination agreements, 45 00:02:33,880 --> 00:02:37,000 Speaker 4: particularly NAFTA, which he renegotiated, which by the way, was 46 00:02:37,040 --> 00:02:38,440 Speaker 4: triumphed by new Gingridge and. 47 00:02:38,360 --> 00:02:40,639 Speaker 3: The Republicans in the House in nineteen ninety three. 48 00:02:40,720 --> 00:02:42,840 Speaker 4: So I thought it was amazing that they just pushed 49 00:02:42,840 --> 00:02:44,079 Speaker 4: this all to the Democrats. 50 00:02:44,560 --> 00:02:46,000 Speaker 3: It was pretty clever of them. 51 00:02:46,639 --> 00:02:48,880 Speaker 4: So that's one way, right, we just don't get a 52 00:02:48,880 --> 00:02:51,120 Speaker 4: good deal when we're part of these multinations in the courts, 53 00:02:51,160 --> 00:02:52,359 Speaker 4: and economically we suffer. 54 00:02:52,560 --> 00:02:55,320 Speaker 3: The other is in military arrangements, we end up paying 55 00:02:55,360 --> 00:02:56,280 Speaker 3: most of the bills. 56 00:02:56,560 --> 00:02:59,320 Speaker 4: And that's what Trump had said in twenty sixteen there 57 00:02:59,400 --> 00:03:02,440 Speaker 4: was presidents, and he's saying again that resonates with a 58 00:03:02,440 --> 00:03:04,839 Speaker 4: lot of Americans, particularly in a time where they see 59 00:03:04,880 --> 00:03:07,679 Speaker 4: that they're struggling to pay their bills because of inflation. 60 00:03:08,000 --> 00:03:11,519 Speaker 4: So it's clever to bring these two issues together, mostly 61 00:03:11,560 --> 00:03:12,639 Speaker 4: under an economic tent. 62 00:03:13,800 --> 00:03:16,280 Speaker 5: Wendy, what do we expect to hear from the former 63 00:03:16,280 --> 00:03:20,240 Speaker 5: president tonight at his speech, Well, Paul. 64 00:03:20,520 --> 00:03:24,320 Speaker 4: Donald Trump has remained more disciplined in the last two 65 00:03:24,360 --> 00:03:27,239 Speaker 4: months of his campaign than we've ever seen him either 66 00:03:27,240 --> 00:03:28,760 Speaker 4: as candidate or president. 67 00:03:28,440 --> 00:03:32,040 Speaker 3: In prior years. I mean, incredibly disciplined. So if this. 68 00:03:32,200 --> 00:03:34,760 Speaker 4: Speech which he gave in twenty sixteen was, you know, 69 00:03:34,840 --> 00:03:36,840 Speaker 4: I'm going to make sure we're safe from crime and 70 00:03:36,880 --> 00:03:38,920 Speaker 4: I'm going to block immigrants, I think it's going to 71 00:03:38,920 --> 00:03:41,760 Speaker 4: be very similar to twenty sixteen, but it might be 72 00:03:42,200 --> 00:03:45,720 Speaker 4: just a little bit more moderated, just a little bit. 73 00:03:45,920 --> 00:03:48,040 Speaker 3: He has squashed abortion at. 74 00:03:47,880 --> 00:03:51,000 Speaker 4: The Republican Convention, which is really remarkable given that it's 75 00:03:51,040 --> 00:03:54,120 Speaker 4: been the driving populist force in the Republican Party for 76 00:03:54,160 --> 00:03:57,280 Speaker 4: so long. So if he stays disciplined and doesn't look 77 00:03:57,320 --> 00:04:00,680 Speaker 4: literally too scary to independent voters, then I think they're 78 00:04:00,720 --> 00:04:02,680 Speaker 4: going to walk away and think this convention was a 79 00:04:02,680 --> 00:04:03,360 Speaker 4: big success. 80 00:04:03,920 --> 00:04:07,240 Speaker 1: Let me break into your poll with Professor Schiller of Brown. 81 00:04:07,720 --> 00:04:11,160 Speaker 1: At the European Central Bank, as expected, they leave key 82 00:04:11,240 --> 00:04:15,640 Speaker 1: rates unched, they wait for signs inflation is under control, 83 00:04:15,800 --> 00:04:18,320 Speaker 1: and they say that Christine lan Guard will not swim 84 00:04:18,320 --> 00:04:18,920 Speaker 1: in the rivers. 85 00:04:19,360 --> 00:04:21,440 Speaker 6: Embarrassedlympics, Wendy. 86 00:04:21,839 --> 00:04:24,599 Speaker 5: It certainly appears to a lot of folks, including myself, 87 00:04:24,640 --> 00:04:27,640 Speaker 5: that this has been a really solid convention for the 88 00:04:27,680 --> 00:04:28,400 Speaker 5: Republican Party. 89 00:04:28,400 --> 00:04:31,040 Speaker 6: How much how much momentum do they have coming out 90 00:04:31,080 --> 00:04:31,280 Speaker 6: of this? 91 00:04:32,320 --> 00:04:35,080 Speaker 4: Every party, if they can pull off a successful convention, 92 00:04:35,160 --> 00:04:36,280 Speaker 4: has momentum coming out. 93 00:04:36,279 --> 00:04:38,719 Speaker 3: Mitt Romney had a lot of momentum coming out in 94 00:04:38,760 --> 00:04:39,600 Speaker 3: twenty twelve. 95 00:04:40,200 --> 00:04:44,960 Speaker 4: You know, the government, I'm sorry, the public focuses on 96 00:04:45,000 --> 00:04:47,400 Speaker 4: the party in that week, and if everybody looks good 97 00:04:47,400 --> 00:04:49,080 Speaker 4: and sounds good, they think, hey, maybe this is the 98 00:04:49,120 --> 00:04:51,440 Speaker 4: party we're going to go with. When we have incumbents, 99 00:04:51,560 --> 00:04:54,320 Speaker 4: they're bringing their priors with, you know, anything that will 100 00:04:54,360 --> 00:04:56,880 Speaker 4: push them away. That was the risk for the Republicans 101 00:04:56,920 --> 00:04:59,560 Speaker 4: is that they've got this energized base, more unified now 102 00:04:59,760 --> 00:05:03,680 Speaker 4: from lots of factors, including the tragic attempt on Trump's life. 103 00:05:03,760 --> 00:05:06,760 Speaker 4: So now they got unity and energy, and you know, 104 00:05:06,839 --> 00:05:08,920 Speaker 4: did they mess it up? And they did not mess 105 00:05:08,960 --> 00:05:12,000 Speaker 4: it up, And that's why I think their momentum continues. 106 00:05:12,160 --> 00:05:15,360 Speaker 4: The Democrats are the exact opposite. It's starting to feel 107 00:05:15,360 --> 00:05:17,320 Speaker 4: a lot like nineteen eighty eight when there was a 108 00:05:17,400 --> 00:05:20,800 Speaker 4: quote unquote winnable election for the Democrats and somehow they 109 00:05:20,839 --> 00:05:23,960 Speaker 4: lost it. So I think the Democrats are under tremendous 110 00:05:23,960 --> 00:05:27,360 Speaker 4: pressure to generate energy. And finally, I will say that 111 00:05:27,360 --> 00:05:31,760 Speaker 4: that may require that Biden step aside very soon in 112 00:05:31,839 --> 00:05:33,400 Speaker 4: order to give them the time to ramp up that 113 00:05:33,520 --> 00:05:34,760 Speaker 4: energy for their own convention. 114 00:05:35,040 --> 00:05:36,480 Speaker 6: So where are we with that? 115 00:05:36,560 --> 00:05:38,719 Speaker 5: I mean, it seems like from past discussions, Wendy, that 116 00:05:38,800 --> 00:05:43,400 Speaker 5: this is the decision solely on President Biden. Can he 117 00:05:43,560 --> 00:05:48,080 Speaker 5: be persuaded to perhaps step down or create a process 118 00:05:48,120 --> 00:05:48,840 Speaker 5: for a new Kennedy? 119 00:05:49,600 --> 00:05:51,880 Speaker 4: Well, Paul, the biggest difference between two weeks ago and 120 00:05:51,920 --> 00:05:54,360 Speaker 4: now is that, you know, chief donors, not just George 121 00:05:54,440 --> 00:05:55,960 Speaker 4: Clooney in the New York Times, but you know, the 122 00:05:56,000 --> 00:05:57,880 Speaker 4: people who are actually really writing a lot of checks 123 00:05:57,880 --> 00:06:01,120 Speaker 4: have stopped basically freezing the money, not giving the money 124 00:06:01,279 --> 00:06:04,040 Speaker 4: that's trickling down to send it house races as well, 125 00:06:04,279 --> 00:06:06,719 Speaker 4: you know, and that means the party could completely collapse. 126 00:06:07,000 --> 00:06:09,720 Speaker 4: So without any money, it just strikes me that Biden 127 00:06:09,760 --> 00:06:12,200 Speaker 4: doesn't have a lot of choices here. And the question 128 00:06:12,320 --> 00:06:15,080 Speaker 4: is really directly, you know, send his delegates to Kamala 129 00:06:15,080 --> 00:06:17,560 Speaker 4: Harris or send it to an open convention, right, And 130 00:06:17,600 --> 00:06:19,720 Speaker 4: I think he's still waiting to hear about that, tomm 131 00:06:19,720 --> 00:06:22,120 Speaker 4: He's still waiting to hear do you have a choice 132 00:06:22,200 --> 00:06:23,800 Speaker 4: is the party unified around Kamala. 133 00:06:24,000 --> 00:06:25,799 Speaker 3: If so, then I'll get out. 134 00:06:26,040 --> 00:06:29,080 Speaker 1: Okay, well maybe that's pulling. How do you envision a 135 00:06:29,200 --> 00:06:34,599 Speaker 1: quote unquote open convention like from this Sunday forward? What 136 00:06:34,640 --> 00:06:36,440 Speaker 1: does that look like? Professor Schiller? 137 00:06:37,839 --> 00:06:40,520 Speaker 4: You know, if you ever imagine a political nightmare, an 138 00:06:40,520 --> 00:06:43,080 Speaker 4: open Democratic convention in twenty twenty four would be that, 139 00:06:43,720 --> 00:06:45,880 Speaker 4: because it will be it will expose the fissures and 140 00:06:45,920 --> 00:06:49,839 Speaker 4: fractures within the Democratic Party between the very progressive left, 141 00:06:50,040 --> 00:06:51,440 Speaker 4: the progressive. 142 00:06:51,200 --> 00:06:54,479 Speaker 3: The middle, and you know, they won't be able to agree. 143 00:06:54,480 --> 00:06:57,400 Speaker 4: They're going to want their person to challenge Trump and 144 00:06:57,440 --> 00:06:58,720 Speaker 4: try and make arguments about that. 145 00:06:58,760 --> 00:07:01,240 Speaker 3: All the way from Bernie Sanders Warren all the way 146 00:07:01,279 --> 00:07:02,000 Speaker 3: down to you know. 147 00:07:02,240 --> 00:07:05,120 Speaker 4: Dark horses like Gina Romando, Secretary of Commerce, you know, 148 00:07:05,240 --> 00:07:07,320 Speaker 4: and Gresha and whiber might be dragged back into it. 149 00:07:07,640 --> 00:07:09,040 Speaker 3: Joshua Prero of Pennsylvania. 150 00:07:09,080 --> 00:07:11,560 Speaker 4: It will look like the Democrats can't decide and don't 151 00:07:11,600 --> 00:07:15,320 Speaker 4: know what they're doing, and will only feed into whatever 152 00:07:15,440 --> 00:07:18,679 Speaker 4: nostalgia Trump voters have for Trump, but also. 153 00:07:18,600 --> 00:07:22,160 Speaker 3: Independent voters who want a stable system. And this is 154 00:07:22,160 --> 00:07:23,680 Speaker 3: the big irony of twenty twenty four. 155 00:07:23,760 --> 00:07:26,760 Speaker 4: Now, the Trump and Republicans appear right now to be 156 00:07:26,840 --> 00:07:30,200 Speaker 4: more stable, less chaotic than Biden and the Democrats. 157 00:07:30,840 --> 00:07:44,280 Speaker 1: Professor Schuler, thank you really appreciate it. You know, folks, 158 00:07:44,360 --> 00:07:46,920 Speaker 1: I'm not big on the parlor game. I really don't 159 00:07:46,960 --> 00:07:50,600 Speaker 1: care about four rate cuts, eight rate cuts, bada b 160 00:07:50,680 --> 00:07:53,520 Speaker 1: blah blah blah. But what I do know is it's 161 00:07:53,520 --> 00:07:57,760 Speaker 1: a lonely crew saying the consensus is wrong. I'm gonna 162 00:07:57,760 --> 00:08:01,480 Speaker 1: put Lindsay pigs. It's stephel That group and the leadership 163 00:08:01,480 --> 00:08:07,400 Speaker 1: of Jim Bianco has been profounding. He absolutely nailed the 164 00:08:07,600 --> 00:08:11,240 Speaker 1: challenge of the last mile of disinflation. He joins us 165 00:08:11,280 --> 00:08:15,720 Speaker 1: now from his Chicago Did Jim your note is seeing 166 00:08:16,320 --> 00:08:17,520 Speaker 1: soon discuss? 167 00:08:18,720 --> 00:08:21,640 Speaker 2: Yes, I don't think the FED should be cutting soon 168 00:08:21,720 --> 00:08:24,960 Speaker 2: because I don't think that the economic data is supporting 169 00:08:24,960 --> 00:08:27,440 Speaker 2: a FED rate cut. And that is is that the 170 00:08:27,520 --> 00:08:30,120 Speaker 2: slowing that you've seen in the US economy might have 171 00:08:30,200 --> 00:08:33,440 Speaker 2: already bottomed. It is growing yet somewhere at around two 172 00:08:33,440 --> 00:08:35,280 Speaker 2: and a half percent for the second quarter. 173 00:08:35,400 --> 00:08:35,960 Speaker 1: That's fine. 174 00:08:36,360 --> 00:08:39,040 Speaker 2: And I think that the inflation rate, while it's come down, 175 00:08:39,440 --> 00:08:42,040 Speaker 2: has largely been in a three to four percent range 176 00:08:42,080 --> 00:08:44,800 Speaker 2: for the last year and a half. It's back to 177 00:08:44,880 --> 00:08:48,000 Speaker 2: three percent, the lower end of the range. And to 178 00:08:48,120 --> 00:08:51,079 Speaker 2: use a fancy term, there's some residual seasonality in the data, 179 00:08:51,120 --> 00:08:54,040 Speaker 2: meaning that you get all the weak inflation data in 180 00:08:54,080 --> 00:08:56,439 Speaker 2: the summer and that's what got you down to three percent. 181 00:08:56,920 --> 00:08:58,640 Speaker 2: And then as we move into the fall, I think 182 00:08:58,640 --> 00:09:01,960 Speaker 2: it stiffens up a little bit. FED shouldn't cut, but 183 00:09:02,040 --> 00:09:03,960 Speaker 2: it looks like their intent on cutting. 184 00:09:04,040 --> 00:09:07,640 Speaker 1: So okay, but chum is inflammatory. I mean, it's really 185 00:09:07,679 --> 00:09:11,199 Speaker 1: something you've got as a for the sake of discussion 186 00:09:11,960 --> 00:09:15,280 Speaker 1: and our start set. And we're not talking two point 187 00:09:15,440 --> 00:09:19,000 Speaker 1: x percent. We're not talking Richard Clarita. We're talking to 188 00:09:19,120 --> 00:09:23,800 Speaker 1: Jym bioncos three or four and you'll even print the 189 00:09:23,880 --> 00:09:28,320 Speaker 1: number five. Is America ready for a three percent four 190 00:09:28,400 --> 00:09:29,560 Speaker 1: percent our start? 191 00:09:31,080 --> 00:09:34,520 Speaker 2: Uh? America is ready for it because the economy can 192 00:09:34,520 --> 00:09:37,360 Speaker 2: handle it, the financial markets can handle it. It's the 193 00:09:37,400 --> 00:09:41,120 Speaker 2: economic community that's not ready for it right now. If 194 00:09:41,160 --> 00:09:43,760 Speaker 2: you look at the current level of interest rates and 195 00:09:43,800 --> 00:09:46,960 Speaker 2: you listen to FED speak, they talk about it being 196 00:09:47,040 --> 00:09:50,520 Speaker 2: highly restrictive. It might be retarding the economic growth. And 197 00:09:50,559 --> 00:09:53,400 Speaker 2: again look at the stock market, Look at the rally 198 00:09:53,400 --> 00:09:56,319 Speaker 2: in small cap stocks when we started pricing in September 199 00:09:56,320 --> 00:09:59,720 Speaker 2: in the last week or so, and the data is 200 00:09:59,800 --> 00:10:03,280 Speaker 2: just not there. But the economists still cling to this 201 00:10:03,800 --> 00:10:07,520 Speaker 2: that the neutral funds rate, which is what our star is, 202 00:10:07,520 --> 00:10:10,080 Speaker 2: is two and a half percent. And put this in terms, 203 00:10:10,440 --> 00:10:12,680 Speaker 2: the Fed thinks they need to cut ten times to 204 00:10:12,679 --> 00:10:14,560 Speaker 2: get to neutral. That's why they want to get started. 205 00:10:14,559 --> 00:10:16,440 Speaker 2: They got a lot of work to do. The market 206 00:10:16,480 --> 00:10:18,920 Speaker 2: is probably telling them, no, you probably need only about 207 00:10:18,920 --> 00:10:21,400 Speaker 2: four or five cuts to get to neutral. There really 208 00:10:21,400 --> 00:10:24,199 Speaker 2: isn't any hurry. But if you're gonna give me stimulatives 209 00:10:24,679 --> 00:10:27,000 Speaker 2: interest rates by lowering them, then I'm going to pile 210 00:10:27,040 --> 00:10:29,000 Speaker 2: into small cap stocks. And that's what we've seen in 211 00:10:29,040 --> 00:10:29,720 Speaker 2: the last week. 212 00:10:29,600 --> 00:10:33,079 Speaker 1: And pout on YouTube live chat. They nail it. It's 213 00:10:33,120 --> 00:10:39,120 Speaker 1: a Sweeney It's a Sweeney live chat six percent cash. Yeah, 214 00:10:39,160 --> 00:10:40,640 Speaker 1: I mean that's maybe what Jim's talking. 215 00:10:40,679 --> 00:10:41,480 Speaker 6: What's wrong with that? 216 00:10:41,720 --> 00:10:45,400 Speaker 5: Hey, Jimm, we have seen that rotation into small caps. 217 00:10:45,760 --> 00:10:47,440 Speaker 5: What do you make of that, because, I mean what 218 00:10:47,480 --> 00:10:49,720 Speaker 5: I'm hearing from some of the strategists is that's a 219 00:10:49,800 --> 00:10:51,440 Speaker 5: rotation like we've never seen before. 220 00:10:52,600 --> 00:10:53,400 Speaker 1: Oh yeah, I agree. 221 00:10:53,480 --> 00:10:56,520 Speaker 2: I mean I've looked at the statistics and it is unprecedented. 222 00:10:56,960 --> 00:10:59,600 Speaker 2: Depending on how you look at it, and usually when 223 00:10:59,640 --> 00:11:02,600 Speaker 2: you get a massive rotation in the small cap stocks 224 00:11:02,600 --> 00:11:06,240 Speaker 2: in the past, it's because the market is literally collapsing 225 00:11:06,440 --> 00:11:09,280 Speaker 2: and big cap stocks are going down faster than small 226 00:11:09,280 --> 00:11:12,840 Speaker 2: cap stocks. This one is everything's going up except for yesterday, 227 00:11:13,040 --> 00:11:15,200 Speaker 2: and small cap stocks are going up a lot more. 228 00:11:15,480 --> 00:11:17,600 Speaker 2: But I really think what it is is that this 229 00:11:17,640 --> 00:11:21,240 Speaker 2: is such a macro dependent market and that that negative 230 00:11:21,280 --> 00:11:24,280 Speaker 2: point one on CPI, you know, the bell one off, 231 00:11:24,320 --> 00:11:26,960 Speaker 2: that's it. The Fed's gonna give us cheaper money. Let's 232 00:11:27,000 --> 00:11:28,800 Speaker 2: go to all of the let's go to all of 233 00:11:28,800 --> 00:11:31,160 Speaker 2: the lagging companies, and let's go to all the companies 234 00:11:31,200 --> 00:11:34,080 Speaker 2: that have borrowed more than that would be in the 235 00:11:34,120 --> 00:11:37,560 Speaker 2: small cap space or have losses in the small cap space, 236 00:11:37,920 --> 00:11:41,559 Speaker 2: and that that cheaper money will benefit them. So everybody 237 00:11:41,559 --> 00:11:44,559 Speaker 2: started to exit large cap and rallied. It ran into 238 00:11:44,640 --> 00:11:47,600 Speaker 2: small cap to a degree we've never seen before. So 239 00:11:47,880 --> 00:11:51,560 Speaker 2: there is no historical precedent for what this means, like 240 00:11:51,760 --> 00:11:54,120 Speaker 2: what what this is mean a month or two months later, 241 00:11:54,280 --> 00:11:56,360 Speaker 2: because we've never seen it, especially in a rally. 242 00:11:57,080 --> 00:12:00,720 Speaker 5: So this is an election year, Jim, how does that 243 00:12:00,840 --> 00:12:04,120 Speaker 5: impact the FED really at the end of the day. 244 00:12:05,160 --> 00:12:07,360 Speaker 2: Well, it should and it has in the past, and 245 00:12:07,600 --> 00:12:09,800 Speaker 2: you know, to be very nuanced about it, the FED 246 00:12:09,840 --> 00:12:13,840 Speaker 2: has never changed direction between Memorial Day and Election Day 247 00:12:14,120 --> 00:12:15,000 Speaker 2: changed direction. 248 00:12:15,040 --> 00:12:15,520 Speaker 1: If they were. 249 00:12:15,440 --> 00:12:18,560 Speaker 2: Hiking, they continue to hike, cutting, continue to cut, hold, 250 00:12:18,600 --> 00:12:21,720 Speaker 2: they continue to hold. They're talking about changing directions in 251 00:12:21,760 --> 00:12:28,120 Speaker 2: September by cutting rates. That is unusual. And the fear 252 00:12:28,200 --> 00:12:32,240 Speaker 2: is that interjects themselves into the political debate because Donald 253 00:12:32,240 --> 00:12:34,680 Speaker 2: Trump won't be happy. He'll say that Jay Paul's trying 254 00:12:34,720 --> 00:12:38,480 Speaker 2: to rig the election against him, and then the FED 255 00:12:38,520 --> 00:12:41,439 Speaker 2: would prefer that their name not get mentioned between now 256 00:12:41,440 --> 00:12:45,439 Speaker 2: an election day, and so they shouldn't be part of it. Now, 257 00:12:45,480 --> 00:12:48,040 Speaker 2: what does it mean for markets? At a macro level? 258 00:12:48,160 --> 00:12:50,880 Speaker 2: Stock spawns the dollar. I don't think you can really 259 00:12:50,920 --> 00:12:54,560 Speaker 2: see the machinations in the in the election there. But 260 00:12:54,720 --> 00:12:57,200 Speaker 2: when you go further down the line, if you look 261 00:12:57,200 --> 00:13:01,280 Speaker 2: at maybe the mean stock of Donald DJ you know, 262 00:13:01,280 --> 00:13:04,520 Speaker 2: Trump Media, that one goes up and down. Tesla seems 263 00:13:04,559 --> 00:13:06,839 Speaker 2: to be another stock because Elon Musk is so tied 264 00:13:06,920 --> 00:13:09,640 Speaker 2: himself with Donald Trump. You know, if you look at 265 00:13:09,679 --> 00:13:12,080 Speaker 2: maybe the prison stocks or the body armor stocks, because 266 00:13:12,080 --> 00:13:14,840 Speaker 2: there's going to be more spending on police and protection, 267 00:13:15,360 --> 00:13:18,160 Speaker 2: those kind of things are moving, but not at the 268 00:13:18,280 --> 00:13:22,600 Speaker 2: higher levels. Are you really seeing this election impacting the market? 269 00:13:23,080 --> 00:13:23,920 Speaker 2: Impacting the market? 270 00:13:24,440 --> 00:13:27,280 Speaker 1: Jim? What's the stock market do here? I mean away 271 00:13:27,280 --> 00:13:29,640 Speaker 1: from the economics. So now do you have an SPX 272 00:13:29,720 --> 00:13:33,400 Speaker 1: or dowd Jones faith out twelve months? 273 00:13:34,840 --> 00:13:37,480 Speaker 2: Well, you know that, you know the stock market I 274 00:13:37,480 --> 00:13:40,720 Speaker 2: think is going to really take its cues from interest rates. 275 00:13:41,760 --> 00:13:44,559 Speaker 2: It bottomed to September of twenty twenty two, and it's 276 00:13:44,600 --> 00:13:46,679 Speaker 2: been rally and there's only been two times when it 277 00:13:46,720 --> 00:13:50,240 Speaker 2: didn't rally, a ten percent correction between June and October 278 00:13:50,280 --> 00:13:52,840 Speaker 2: of last year and March and April this year six 279 00:13:52,920 --> 00:13:58,200 Speaker 2: percent correction. What was what was existed during both those 280 00:13:58,320 --> 00:14:01,320 Speaker 2: corrections the tenure field above four and a half percent. 281 00:14:01,720 --> 00:14:03,280 Speaker 2: When the ten year yield gets above four and a 282 00:14:03,280 --> 00:14:06,240 Speaker 2: half percent, the stock market seems to struggle. We're at 283 00:14:06,280 --> 00:14:08,360 Speaker 2: four eighteen right now, so we're not above four and 284 00:14:08,400 --> 00:14:12,280 Speaker 2: a half percent. But if the market starts to feel 285 00:14:12,280 --> 00:14:15,440 Speaker 2: like the Fed's going to ease, the economy's okay. This 286 00:14:15,520 --> 00:14:19,800 Speaker 2: inflation problem is not solved. The rejection of that policy 287 00:14:19,800 --> 00:14:21,920 Speaker 2: could be higher interest rates, and if it gets above 288 00:14:21,960 --> 00:14:24,920 Speaker 2: four and a half percent, that could become a problem 289 00:14:24,960 --> 00:14:27,440 Speaker 2: for the stock market. So right now, I think it's 290 00:14:27,440 --> 00:14:29,120 Speaker 2: going to be okay. It's just going to go through 291 00:14:29,120 --> 00:14:33,040 Speaker 2: this massive rotation that we haven't seen before, and it's 292 00:14:33,080 --> 00:14:35,440 Speaker 2: going to be really dependent on whether or not interest 293 00:14:35,520 --> 00:14:38,080 Speaker 2: rates start to head higher. And I'll conclude by saying, 294 00:14:38,480 --> 00:14:41,000 Speaker 2: I ultimately think by the end of the year into 295 00:14:41,040 --> 00:14:43,600 Speaker 2: the first quarter they will get well above four and 296 00:14:43,600 --> 00:14:46,280 Speaker 2: a half percent again and it will be a problem. 297 00:14:46,280 --> 00:14:47,480 Speaker 2: But they're not there right now. 298 00:14:47,640 --> 00:14:50,960 Speaker 1: Jim Bianco from Chicago, thank you so much. Bianco there 299 00:14:51,080 --> 00:14:54,760 Speaker 1: is it's really important comments there pushing against the Fedzeite 300 00:14:54,800 --> 00:15:08,920 Speaker 1: geys to say the least quot he Van Steinas joins 301 00:15:09,000 --> 00:15:11,120 Speaker 1: us right now, Hugh, I got to rip up the 302 00:15:11,120 --> 00:15:15,640 Speaker 1: script here on ECB, we stagger from Deusenberg to Triche 303 00:15:16,480 --> 00:15:19,320 Speaker 1: and a dragi in the modern day of leguard. How's 304 00:15:19,360 --> 00:15:24,360 Speaker 1: that ECB experience experiment going, h von Steina's. 305 00:15:25,400 --> 00:15:28,000 Speaker 7: Well, great to be back with you, Tom, and glad 306 00:15:28,040 --> 00:15:29,520 Speaker 7: I'm not swimming in the Sein at the moment, left 307 00:15:29,560 --> 00:15:32,920 Speaker 7: alone in the Thames. Look, I think ECB experiment has 308 00:15:32,960 --> 00:15:36,000 Speaker 7: been painful. You and I have chatted many times over 309 00:15:36,040 --> 00:15:38,720 Speaker 7: the last you know, a dozen a dozen and a 310 00:15:38,760 --> 00:15:41,880 Speaker 7: half years really since the Euro has been introduced. How 311 00:15:42,320 --> 00:15:44,680 Speaker 7: we've had to have an awful lot of emergency measures, 312 00:15:44,960 --> 00:15:48,720 Speaker 7: whether it's q E and tltrra's special bank lending schemes 313 00:15:48,800 --> 00:15:51,280 Speaker 7: to fend off the Eurozone crisis. Then we had this 314 00:15:51,440 --> 00:15:55,760 Speaker 7: dangerous experiment of negative interest rates. Finally we're getting back 315 00:15:55,760 --> 00:15:58,040 Speaker 7: to a little bit of normality, even if maybe not 316 00:15:58,080 --> 00:16:00,520 Speaker 7: so normal on the politics side. So I think it's 317 00:16:00,560 --> 00:16:03,360 Speaker 7: been a very painful experience, and I think, well, you know, 318 00:16:03,360 --> 00:16:04,560 Speaker 7: one of the things I'd put in my op ed 319 00:16:04,560 --> 00:16:07,240 Speaker 7: of the ft last week is we still haven't finished 320 00:16:07,280 --> 00:16:10,800 Speaker 7: the reforms. I went to that I was invited somehow. 321 00:16:10,840 --> 00:16:12,640 Speaker 7: It's the ten year anniversary of Banking Union. 322 00:16:13,040 --> 00:16:13,240 Speaker 1: Tom. 323 00:16:13,240 --> 00:16:15,640 Speaker 7: I didn't see you there. But the problem was it's 324 00:16:15,640 --> 00:16:17,920 Speaker 7: only got one leg finished to two parts of the 325 00:16:17,960 --> 00:16:21,400 Speaker 7: house are still unfinished, and securitization in Europe has been 326 00:16:21,440 --> 00:16:23,720 Speaker 7: basically dead as a dodo for fifteen years, and so 327 00:16:23,720 --> 00:16:25,600 Speaker 7: there's plenty of work still to be done. 328 00:16:25,720 --> 00:16:29,200 Speaker 1: I should interview. I introduced him properly here. Vanstein is 329 00:16:29,320 --> 00:16:33,560 Speaker 1: vice chair of Oliver Wyman's Service to the United Kingdom 330 00:16:33,640 --> 00:16:35,560 Speaker 1: with Mark Kearney at the Bank of England and of 331 00:16:35,600 --> 00:16:39,960 Speaker 1: course his endowment work with his Oxford University here Vansteina, 332 00:16:40,040 --> 00:16:41,800 Speaker 1: she sent me a chat the other day, which is 333 00:16:41,840 --> 00:16:45,800 Speaker 1: your wheelhouse, which is trying to keep track of the 334 00:16:45,840 --> 00:16:49,840 Speaker 1: shadows to come in banking and this is always about 335 00:16:50,040 --> 00:16:56,080 Speaker 1: highest quality tranches unloading the garbage of lower quality tranches 336 00:16:56,920 --> 00:17:01,120 Speaker 1: to somebody else. Who's the somebody else this time around? 337 00:17:02,760 --> 00:17:05,600 Speaker 7: It's a great question, tom So. I think that the 338 00:17:05,720 --> 00:17:09,639 Speaker 7: challenge here is it's there's no simple picture. So if 339 00:17:09,680 --> 00:17:13,160 Speaker 7: you take let's say our friends at Apollo or Blackstone 340 00:17:13,200 --> 00:17:17,760 Speaker 7: working with their insurance colleagues, well, insurance companies need investment grade. 341 00:17:18,280 --> 00:17:21,080 Speaker 7: If they can just get even fifty basis points more 342 00:17:21,600 --> 00:17:25,439 Speaker 7: than their competitors over a decade to twelve years, that's huge. 343 00:17:25,920 --> 00:17:28,560 Speaker 7: So in their case, they're really wanting high quality, investment 344 00:17:28,600 --> 00:17:31,040 Speaker 7: grade assets. Clearly, if you're going to get twelve to 345 00:17:31,080 --> 00:17:33,520 Speaker 7: fifteen points of return, you're going to need to be 346 00:17:33,560 --> 00:17:36,480 Speaker 7: taking a lot more risk. And so there's some endowments, 347 00:17:36,800 --> 00:17:40,280 Speaker 7: pension funds and increasingly high network or maybe reaching down, 348 00:17:40,680 --> 00:17:42,800 Speaker 7: but there is no The challenge here is there's not 349 00:17:42,840 --> 00:17:45,120 Speaker 7: a great data set. And that's in way why black 350 00:17:45,200 --> 00:17:48,119 Speaker 7: Rock Port. You know that big data company recently, but 351 00:17:48,240 --> 00:17:52,520 Speaker 7: also it's more complex. I mean, I'm not Look, credit 352 00:17:52,600 --> 00:17:54,479 Speaker 7: is credit, there is a site, there'll be a cycle. 353 00:17:54,560 --> 00:17:56,760 Speaker 7: There's always stuff which goes wrong. So I'm not going 354 00:17:56,840 --> 00:18:00,159 Speaker 7: to be panglossy on that there won't be problems. But 355 00:18:00,400 --> 00:18:02,760 Speaker 7: on the other hand, I don't see that this is 356 00:18:02,920 --> 00:18:04,439 Speaker 7: I don't think there's any reason to panic. 357 00:18:05,280 --> 00:18:08,399 Speaker 5: You just you referenced upbed in the Financial Times back 358 00:18:08,680 --> 00:18:12,240 Speaker 5: about eleven days ago, in that you say Europe's capital 359 00:18:12,280 --> 00:18:16,359 Speaker 5: markets are underdeveloped while its banking sector is insufficiently sized 360 00:18:16,400 --> 00:18:19,439 Speaker 5: to handle the growing demands for capital expenditures tied the 361 00:18:19,520 --> 00:18:21,879 Speaker 5: energy transition, digital infrastructure defense. 362 00:18:22,920 --> 00:18:25,479 Speaker 6: Is there a solution there? I mean, what is the solution? 363 00:18:27,160 --> 00:18:29,399 Speaker 7: Look, I think it's a great point. And so Europe 364 00:18:29,400 --> 00:18:32,040 Speaker 7: relies far far more on the banks. So point one, 365 00:18:32,160 --> 00:18:34,040 Speaker 7: I would be in favor of trying to, you know, 366 00:18:34,640 --> 00:18:38,080 Speaker 7: have interesting investment opportunities which fixed income investors around the 367 00:18:38,080 --> 00:18:41,080 Speaker 7: world or equity ones would want to come and sees. 368 00:18:41,560 --> 00:18:43,960 Speaker 7: So I think part one is making it easier to 369 00:18:44,040 --> 00:18:47,439 Speaker 7: list having a small standardization in the bomb markets. And 370 00:18:47,480 --> 00:18:51,560 Speaker 7: then the piece I was particularly saying securitizations have really 371 00:18:51,600 --> 00:18:55,560 Speaker 7: not rebounded since the financial crisis the way the Europeans 372 00:18:55,640 --> 00:18:59,520 Speaker 7: codified that closed the door after the financial crisis was 373 00:18:59,560 --> 00:19:02,240 Speaker 7: incredible to be penal and therefore it's never really started. 374 00:19:02,600 --> 00:19:06,520 Speaker 7: And I think that's that allowing banks to package loans 375 00:19:06,640 --> 00:19:09,400 Speaker 7: and puncel them on to investors is actually a really 376 00:19:09,480 --> 00:19:12,600 Speaker 7: smart way to help us through Europe's growth. So I 377 00:19:12,600 --> 00:19:16,720 Speaker 7: think really scuritizations there. In the next two weeks we 378 00:19:16,800 --> 00:19:19,840 Speaker 7: might see the Draggy report published, and certainly what my 379 00:19:19,960 --> 00:19:21,560 Speaker 7: sense of that is that he's going to be also 380 00:19:21,640 --> 00:19:24,639 Speaker 7: arguing to try and you know, dust off the plan 381 00:19:24,720 --> 00:19:28,240 Speaker 7: to reopen securitizations. But it's more than just that. I mean, 382 00:19:28,480 --> 00:19:30,920 Speaker 7: you know, whether it's you know how the US elections going, 383 00:19:31,119 --> 00:19:33,560 Speaker 7: Europe will need to spend more on defense, It'll need 384 00:19:33,600 --> 00:19:36,959 Speaker 7: to spend more on energy security, let alone transition and 385 00:19:37,000 --> 00:19:40,119 Speaker 7: of course upgrading it's degenfrastructure. These are vast sums, and 386 00:19:40,160 --> 00:19:42,320 Speaker 7: I don't think the banking system alone is big enough 387 00:19:42,320 --> 00:19:45,639 Speaker 7: and strong enough. And Dragging himself in Portugal the other 388 00:19:45,680 --> 00:19:49,000 Speaker 7: day said he didn't think Europe's banks had enough fast. 389 00:19:49,440 --> 00:19:52,000 Speaker 1: But you know this is important. Bruce chas been publishing 390 00:19:52,040 --> 00:19:55,359 Speaker 1: moments ago folks at JP Morgan and he's just his 391 00:19:55,480 --> 00:19:59,320 Speaker 1: global disinflation to continue in the second half of this year. 392 00:20:00,119 --> 00:20:04,520 Speaker 1: What does disinflation mean? You've unsteen as to the financial system. 393 00:20:04,880 --> 00:20:08,200 Speaker 1: It's constructed as a good. I don't buy it. There's 394 00:20:08,200 --> 00:20:11,480 Speaker 1: an ambiguity. 395 00:20:11,560 --> 00:20:14,120 Speaker 7: So it depends which which bit of disinflation we're talking 396 00:20:14,160 --> 00:20:17,160 Speaker 7: about here, If it's sort of if it's Chinese exports 397 00:20:17,440 --> 00:20:21,520 Speaker 7: impacting Europe, that's one thing. It depends where we're going. 398 00:20:21,560 --> 00:20:23,679 Speaker 7: I mean, as we're seeing from THECB today, there's not 399 00:20:23,840 --> 00:20:28,560 Speaker 7: massive disinflation. There's quite frankly still inflationary pressures in the system. 400 00:20:28,880 --> 00:20:31,680 Speaker 7: But at the end of the day, banks are lever 401 00:20:31,800 --> 00:20:35,040 Speaker 7: plays on growth and what we've seen is very Whilst 402 00:20:35,040 --> 00:20:37,360 Speaker 7: loan growth in the last bank lending survey has picked 403 00:20:37,440 --> 00:20:40,040 Speaker 7: up a little bit, it's still really low. I mean, 404 00:20:40,160 --> 00:20:42,719 Speaker 7: in the last decade, bank loan growth in Europe has 405 00:20:42,720 --> 00:20:45,080 Speaker 7: been half that in the States, and that's because Europe 406 00:20:45,160 --> 00:20:47,000 Speaker 7: has not been growing as far. So I think that 407 00:20:47,119 --> 00:20:50,960 Speaker 7: disinflation and the pressures on exports for Germany, the pressures 408 00:20:51,000 --> 00:20:54,560 Speaker 7: on on growth in France, these are ones which will 409 00:20:54,560 --> 00:20:57,800 Speaker 7: be challenging. But what what where, Let's be clear, for 410 00:20:57,840 --> 00:21:00,640 Speaker 7: every problem is a solution. In my conversations with bank 411 00:21:00,760 --> 00:21:05,400 Speaker 7: CEOs and CFOs. They are looking to optimize their balance sheets. 412 00:21:05,880 --> 00:21:08,879 Speaker 7: The reason why they're they're partnering up with private credits. 413 00:21:08,920 --> 00:21:10,800 Speaker 7: Only this morning we saw a Lloyd's, the number one 414 00:21:10,840 --> 00:21:12,800 Speaker 7: bank in the UK, partnering up with oak Tree part 415 00:21:12,800 --> 00:21:15,720 Speaker 7: of Brookfield is because they want to try and you know, 416 00:21:15,920 --> 00:21:19,520 Speaker 7: free ups and capital to offer dividends and buybacks. So 417 00:21:19,800 --> 00:21:21,800 Speaker 7: for every problem there's a solution, and I think that's 418 00:21:21,840 --> 00:21:24,240 Speaker 7: why the private credit trade in Europe is actually still 419 00:21:24,280 --> 00:21:24,880 Speaker 7: quite interesting. 420 00:21:24,960 --> 00:21:27,160 Speaker 1: You haven't seen this, Thank you so much for Oliver. 421 00:21:27,560 --> 00:21:41,360 Speaker 1: Whyman I can't say no? The front pages of Lisa Matteo, 422 00:21:41,720 --> 00:21:44,160 Speaker 1: we start strugging with a pause and nugget I saw 423 00:21:44,200 --> 00:21:46,400 Speaker 1: this party, I said, are you kidneming? 424 00:21:46,600 --> 00:21:50,720 Speaker 8: Lisa discussed are the Warner Brothers. Apparently they need to 425 00:21:50,720 --> 00:21:52,560 Speaker 8: boost their share price right, so they may be looking 426 00:21:52,560 --> 00:21:56,520 Speaker 8: at splits digital streaming and studio business from its TV networks. 427 00:21:56,640 --> 00:21:59,160 Speaker 8: So this is from the Financial Times. They're saying CEO 428 00:21:59,240 --> 00:22:02,040 Speaker 8: David's as I've looking into a few options from selling 429 00:22:02,080 --> 00:22:04,760 Speaker 8: the assets to actually yes, splitting off its Warner Brothers 430 00:22:04,880 --> 00:22:08,560 Speaker 8: movie studio and that Max streaming service into a new company. 431 00:22:09,560 --> 00:22:11,840 Speaker 8: They haven't hired an investment banker and anything like that. 432 00:22:11,880 --> 00:22:14,639 Speaker 8: But it's top manager reportedly talking to advisors. But I 433 00:22:14,680 --> 00:22:16,119 Speaker 8: mean the whole thing is about it, I guess boosting 434 00:22:16,119 --> 00:22:16,640 Speaker 8: the share price. 435 00:22:16,760 --> 00:22:19,040 Speaker 5: Yeah, And I think about Warner Brothers Discovery. They have 436 00:22:19,280 --> 00:22:24,240 Speaker 5: two very interesting big investors. One is capabillionaire John Malone 437 00:22:24,320 --> 00:22:26,280 Speaker 5: and the other one is the new House family which 438 00:22:26,480 --> 00:22:27,920 Speaker 5: controls Conde Nest. 439 00:22:28,480 --> 00:22:31,439 Speaker 6: Very very smart media folks there, yes, And they know 440 00:22:31,480 --> 00:22:32,359 Speaker 6: where the value is. 441 00:22:32,400 --> 00:22:35,000 Speaker 5: And the value is probably in the streaming businesses, not 442 00:22:35,119 --> 00:22:37,160 Speaker 5: necessarily in some of the legacy networks. 443 00:22:37,280 --> 00:22:40,920 Speaker 1: It in vast offices here, the surveillance offices. I sat 444 00:22:41,280 --> 00:22:45,439 Speaker 1: fifteen feet that way the day Chrysler ran over the 445 00:22:45,480 --> 00:22:49,960 Speaker 1: bondholders and I'm sorry. The ft explains this beautifully, folks. 446 00:22:50,040 --> 00:22:53,199 Speaker 1: What they're going to do is take the gazillions of 447 00:22:53,400 --> 00:22:56,920 Speaker 1: debt and put it into the news division. Is they 448 00:22:56,960 --> 00:23:00,879 Speaker 1: wander off with Sweeney's streaming company? Got to be kidn 449 00:23:00,960 --> 00:23:03,760 Speaker 1: me and this day and age, they're gonna get away 450 00:23:03,800 --> 00:23:04,080 Speaker 1: with that? 451 00:23:04,119 --> 00:23:04,320 Speaker 7: With it? 452 00:23:04,440 --> 00:23:06,960 Speaker 6: I don't don't know. I don't know. I mean again, 453 00:23:07,040 --> 00:23:08,080 Speaker 6: they it's interesting. 454 00:23:08,080 --> 00:23:10,200 Speaker 5: They have so much debt on this company that they 455 00:23:10,200 --> 00:23:12,080 Speaker 5: have to put the debt where the cash flow is 456 00:23:12,480 --> 00:23:13,320 Speaker 5: to support the debt. 457 00:23:13,400 --> 00:23:14,160 Speaker 6: So we'll see. 458 00:23:14,200 --> 00:23:17,320 Speaker 5: But again, this is a typical it's such a typical deal. 459 00:23:17,359 --> 00:23:20,080 Speaker 5: I'm already envisioning the pitch book because that I would 460 00:23:20,119 --> 00:23:22,320 Speaker 5: have put together to go to the board and go 461 00:23:22,359 --> 00:23:22,960 Speaker 5: to the management. 462 00:23:23,000 --> 00:23:26,199 Speaker 6: Here it's just right out of the central casting of 463 00:23:26,320 --> 00:23:28,359 Speaker 6: it is of M and A, you know, diabetes. 464 00:23:28,359 --> 00:23:32,320 Speaker 1: But are those times still in play? That's well, I think, 465 00:23:32,480 --> 00:23:34,560 Speaker 1: I wonder the rules of the road has changed. 466 00:23:34,760 --> 00:23:37,160 Speaker 5: They may have, but boy, look at the principles here again, 467 00:23:37,240 --> 00:23:42,120 Speaker 5: John Malone, the Conde Nest, David Zaslov the CEO. This 468 00:23:42,200 --> 00:23:45,119 Speaker 5: is in their wheelhouse. They think about these things. Where's 469 00:23:45,160 --> 00:23:46,920 Speaker 5: the value and what can support the debt? 470 00:23:46,960 --> 00:23:47,400 Speaker 6: So we'll see. 471 00:23:47,480 --> 00:23:49,359 Speaker 1: Okay, so I got I can bring it up on 472 00:23:49,400 --> 00:23:52,760 Speaker 1: the Bloomberg. I got forty two bills in debt, yep. 473 00:23:52,920 --> 00:23:55,240 Speaker 1: And they're gonna they're gonna give that. They're gonna hand 474 00:23:55,240 --> 00:23:56,280 Speaker 1: that to Wolf Blitzer. 475 00:23:56,640 --> 00:23:58,280 Speaker 6: Yes, exactly, we'll see. 476 00:23:58,520 --> 00:24:01,600 Speaker 1: That's exactly what we're talking about. Margaret running here, Margaret, 477 00:24:01,600 --> 00:24:03,919 Speaker 1: you take ten billion of debt, and well if you 478 00:24:03,960 --> 00:24:06,159 Speaker 1: take thirty two billion of debt, sure, and that's what 479 00:24:06,160 --> 00:24:06,840 Speaker 1: we're talking about. 480 00:24:06,840 --> 00:24:08,840 Speaker 5: And there's ten billion of EBITDAD to support that. So 481 00:24:08,880 --> 00:24:11,320 Speaker 5: it's about four times net debt to EBITDA. 482 00:24:11,760 --> 00:24:17,480 Speaker 6: That's okay, it's not crushing, but it's it's it's tough. 483 00:24:17,520 --> 00:24:19,240 Speaker 5: They weren't fifty two billion in debt just a couple 484 00:24:19,240 --> 00:24:21,160 Speaker 5: of years ago, so they are paying it down. They've 485 00:24:21,160 --> 00:24:23,440 Speaker 5: got five billion dollars a year free cash flow. There 486 00:24:23,480 --> 00:24:26,240 Speaker 5: is stuff there to build on, but I'll leave it to. 487 00:24:28,119 --> 00:24:30,600 Speaker 1: Moffatt, Nathan Simon us. We'll get the adults in here 488 00:24:30,640 --> 00:24:33,960 Speaker 1: to describe this. Maybe Mar Gabelli. Ok No, I'm sorry, Li, 489 00:24:34,119 --> 00:24:35,280 Speaker 1: So we get carried away in it. 490 00:24:35,680 --> 00:24:37,919 Speaker 8: No, it's good, it's good. Another deal, okay, this was 491 00:24:37,920 --> 00:24:41,919 Speaker 8: for the WNBA. Apparently the framework is set the new 492 00:24:41,960 --> 00:24:45,600 Speaker 8: media rights deal with Disney, NBC, Amazon. It was first 493 00:24:45,640 --> 00:24:48,480 Speaker 8: reported by The Athletic. The Wall Street Journal confirmed the numbers. 494 00:24:48,520 --> 00:24:50,600 Speaker 8: The league set to bring in approximately two point two 495 00:24:50,840 --> 00:24:55,240 Speaker 8: billion over eleven years. Now, if you break down the numbers, 496 00:24:55,320 --> 00:24:58,359 Speaker 8: so the WNBA's current media rights valued at about sixty 497 00:24:58,400 --> 00:25:00,760 Speaker 8: million per year, this new structure would be in the 498 00:25:00,800 --> 00:25:03,320 Speaker 8: annual range of two hundred million. 499 00:25:03,680 --> 00:25:06,600 Speaker 6: So you see the different Still still right right in 500 00:25:06,600 --> 00:25:07,119 Speaker 6: my opinion? 501 00:25:07,240 --> 00:25:08,760 Speaker 8: Still well, I mean, we're talking about the age, I 502 00:25:08,760 --> 00:25:10,720 Speaker 8: would not wake up that element behind the w. 503 00:25:10,880 --> 00:25:12,800 Speaker 5: If I were the WNBA, I would not lock up 504 00:25:12,800 --> 00:25:16,040 Speaker 5: for this long. I think, I think, I think there 505 00:25:16,040 --> 00:25:18,280 Speaker 5: are really at the cusp was Caitlin Clark and all 506 00:25:18,280 --> 00:25:20,040 Speaker 5: the other great young players into the league. 507 00:25:20,560 --> 00:25:21,960 Speaker 6: This it's everywhere you. 508 00:25:21,920 --> 00:25:23,960 Speaker 5: Go to ESPN dot com, you pull up the app, 509 00:25:24,320 --> 00:25:26,600 Speaker 5: you get the n w NBA stuff before you get 510 00:25:26,600 --> 00:25:29,359 Speaker 5: like Major League Baseball, and that's how they rank it. 511 00:25:29,359 --> 00:25:32,480 Speaker 6: It's unbelievable. So if I were the w NBA, I'd 512 00:25:32,480 --> 00:25:33,800 Speaker 6: go short here on my deal. 513 00:25:33,840 --> 00:25:35,600 Speaker 1: But that's just what do you got next. 514 00:25:36,440 --> 00:25:40,920 Speaker 8: Cidel founder Kenneth Griffines. He apparently has a thing for collectibles, 515 00:25:41,000 --> 00:25:43,320 Speaker 8: so he set a record for a fossil sold at auction. 516 00:25:43,480 --> 00:25:45,040 Speaker 6: He paid forty four point six. 517 00:25:45,240 --> 00:25:49,320 Speaker 8: Million dollars at souther B's for a one hundred and 518 00:25:49,320 --> 00:25:52,520 Speaker 8: fifty million year old stegosaurus. Its name is Apex. It's 519 00:25:52,520 --> 00:25:55,479 Speaker 8: about eleven feet tall. It was found in Colorado. It 520 00:25:55,520 --> 00:25:58,399 Speaker 8: was actually expected to get six million, and he paid 521 00:25:58,440 --> 00:26:02,359 Speaker 8: forty five million for it. Some people say he wants 522 00:26:02,400 --> 00:26:04,480 Speaker 8: to lend it to a US museum, but I mean, 523 00:26:04,520 --> 00:26:08,399 Speaker 8: he's done these trophy pieces before, but this is just 524 00:26:08,320 --> 00:26:08,800 Speaker 8: just go buy. 525 00:26:08,680 --> 00:26:10,800 Speaker 6: A sports team. 526 00:26:10,920 --> 00:26:13,080 Speaker 8: I guess he likes buying. 527 00:26:12,960 --> 00:26:16,360 Speaker 6: All right, he donates to it. 528 00:26:17,400 --> 00:26:22,080 Speaker 1: ABC has a Tyrannosaurus wrecks. That's the that's the mean 529 00:26:22,119 --> 00:26:25,480 Speaker 1: one in the movies, the meat Eater. Its nickname was 530 00:26:25,640 --> 00:26:30,560 Speaker 1: Stan and it's sold for thirty one million four years ago. 531 00:26:30,680 --> 00:26:34,120 Speaker 1: Thank you ABC for that. I made a joke about legos. 532 00:26:34,160 --> 00:26:36,560 Speaker 1: I mean the kids. The kids are all into it 533 00:26:36,600 --> 00:26:41,000 Speaker 1: and then it's over right. You know it's a Stegosaurus. 534 00:26:41,200 --> 00:26:43,480 Speaker 1: There's one, and I think it's in England. I can't remember. 535 00:26:44,000 --> 00:26:46,400 Speaker 1: There's one that's very cool in a museum. 536 00:26:46,080 --> 00:26:48,720 Speaker 6: And it's got the bumps on the back or something 537 00:26:48,760 --> 00:26:48,919 Speaker 6: like that. 538 00:26:49,800 --> 00:26:57,399 Speaker 1: It just kills. Take it back to my geology university, Lisa, 539 00:26:57,600 --> 00:26:58,360 Speaker 1: save us. 540 00:26:58,520 --> 00:27:00,560 Speaker 8: Okay, the last one. This one's for the you talked 541 00:27:00,560 --> 00:27:04,399 Speaker 8: about legos and stuff. Okay, this is a new Beanie baby. 542 00:27:04,480 --> 00:27:05,400 Speaker 2: If you've heard about it. 543 00:27:05,520 --> 00:27:07,800 Speaker 8: You know, beanie babies kind of faded after a while, 544 00:27:08,680 --> 00:27:10,560 Speaker 8: but it is a big deal. So now they have 545 00:27:10,640 --> 00:27:14,560 Speaker 8: something called a Beanie Bouncer. It's this little four inch 546 00:27:14,640 --> 00:27:17,280 Speaker 8: toy and you can bounce it. It has a ball 547 00:27:17,320 --> 00:27:19,280 Speaker 8: inside and it goes about fifty feet high. 548 00:27:19,520 --> 00:27:20,440 Speaker 6: So the kids are going. 549 00:27:20,400 --> 00:27:23,120 Speaker 8: To wreck haf it inside your house with this exactly? 550 00:27:23,680 --> 00:27:28,200 Speaker 8: You take it outside, take it outside. Okay, but they're 551 00:27:28,240 --> 00:27:30,600 Speaker 8: saying that it's got the patents for it. It's going 552 00:27:30,640 --> 00:27:32,119 Speaker 8: to go along with the patents. It comes in like 553 00:27:32,160 --> 00:27:35,080 Speaker 8: twelve animal characters. But this could be the hot new 554 00:27:35,080 --> 00:27:35,800 Speaker 8: thing at Christmas. 555 00:27:35,800 --> 00:27:39,399 Speaker 1: Remember the rubber ball that you slammed on the driveway 556 00:27:40,200 --> 00:27:42,320 Speaker 1: and you tried to get it to go over the house, 557 00:27:43,280 --> 00:27:46,560 Speaker 1: which you did four or five times until a second 558 00:27:46,640 --> 00:27:47,800 Speaker 1: floor window went out. 559 00:27:48,000 --> 00:27:49,920 Speaker 6: I got stuck in a gutt hard. But it's good. 560 00:27:49,960 --> 00:27:52,119 Speaker 8: You get the kids outside, so you get them off 561 00:27:52,119 --> 00:27:53,760 Speaker 8: the technology out outside. 562 00:27:53,760 --> 00:27:54,400 Speaker 6: I'm off for that. 563 00:27:54,800 --> 00:27:56,119 Speaker 1: Do your kids go outside? 564 00:27:57,440 --> 00:28:00,440 Speaker 8: They do because they're forced. They have sports, ever their 565 00:28:01,000 --> 00:28:03,480 Speaker 8: forwards out of time. It's a huge dude, but it's 566 00:28:03,560 --> 00:28:05,600 Speaker 8: you do. You have to get them off of remember 567 00:28:05,600 --> 00:28:07,760 Speaker 8: when they were little, like getting them off the devices 568 00:28:07,800 --> 00:28:08,679 Speaker 8: and getting them outside. 569 00:28:08,800 --> 00:28:09,240 Speaker 6: Got to do it. 570 00:28:09,520 --> 00:28:12,880 Speaker 1: It's okay, Well, thank you, Lisa. Is that it one? 571 00:28:13,240 --> 00:28:13,560 Speaker 6: That's it? 572 00:28:13,600 --> 00:28:15,520 Speaker 8: You know there was one about alcohol being bad for 573 00:28:15,560 --> 00:28:17,119 Speaker 8: your health, but that was in the journal. But I 574 00:28:17,119 --> 00:28:21,720 Speaker 8: think that wouldn't go that would go over very well here. 575 00:28:23,280 --> 00:28:28,480 Speaker 1: Yeah, I said, nah. Next this is the Bloomberg surveillance podcast, 576 00:28:28,720 --> 00:28:33,560 Speaker 1: bringing you the best in economics, finance, investment, and international relations. 577 00:28:33,800 --> 00:28:37,160 Speaker 1: You can also watch the show live on YouTube. Visit 578 00:28:37,200 --> 00:28:41,320 Speaker 1: the Bloomberg Podcast channel on YouTube to see the show 579 00:28:41,560 --> 00:28:44,600 Speaker 1: weekday mornings from seven to ten am Eastern from our 580 00:28:44,640 --> 00:28:48,440 Speaker 1: global headquarters in New York City. 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