WEBVTT - Reviving Immigration Is Key To U.S. Turnaround: Kotok 0:00:01.400 --> 0:00:04.120 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, along 0:00:04.120 --> 0:00:06.240 with my co host of Bonnie Quinn. Every business day 0:00:06.240 --> 0:00:10.400 we bring you interviews from CEOs, market pros, and Bloomberg experts, 0:00:10.400 --> 0:00:13.600 along with essential market moving news. Find the Bloomberg Markets 0:00:13.600 --> 0:00:17.000 Podcast on Apple Podcasts or wherever you listen to podcasts, 0:00:17.000 --> 0:00:20.960 and on Bloomberg dot com. All right, we've got some 0:00:21.160 --> 0:00:25.280 big round numbers out there. Of course, DAL thirty thousand, 0:00:25.720 --> 0:00:29.960 NASDAC twelve thousand, that's just extraordinary. They're big numbers. What 0:00:30.000 --> 0:00:31.520 do they mean? Let's try to put some of that 0:00:31.560 --> 0:00:35.000 into context. Nobody better to do that with. Then, David 0:00:35.040 --> 0:00:38.240 Ko Talk, Chairman and chief investment officer of Cumberland Advisors. 0:00:38.240 --> 0:00:41.159 They have over three billion dollars in assets under management, 0:00:41.479 --> 0:00:44.920 located in beautiful Sarasota, Florida. David, thanks much for joining 0:00:44.960 --> 0:00:47.760 us again. Okay, some big round numbers. A lot of 0:00:47.760 --> 0:00:49.839 people say, I don't worry about it, They're just numbers, 0:00:49.840 --> 0:00:55.280 but boy, what do you make of them? Well, it's extraordinary, Paul, 0:00:55.400 --> 0:01:00.160 thank you very much for having me on. Um. You know, 0:01:00.280 --> 0:01:04.520 I thought that to the book DAL thirty thousand when 0:01:04.560 --> 0:01:07.919 it was written and we were all a few weeks 0:01:07.959 --> 0:01:13.400 younger then, and and people thought it was a statement 0:01:13.440 --> 0:01:17.000 of madness at the time. Look where we are, so 0:01:17.319 --> 0:01:21.280 it's a streny. The markets, as we see it, are 0:01:21.400 --> 0:01:26.160 looking beyond next spring. Um, it's the classics six or 0:01:26.280 --> 0:01:34.000 nine months uhum forward looking post vaccine recovery. And you 0:01:34.120 --> 0:01:38.679 see some forecasts of the rory twenties. I read a 0:01:38.680 --> 0:01:42.080 piece I hadyard Any about that he's using that mantra. 0:01:42.680 --> 0:01:47.800 So maybe we have the explosion of spending of what 0:01:47.920 --> 0:01:53.120 has been a year of accumulated savings um in this 0:01:53.840 --> 0:01:59.639 release of cabin fever. After we inoculate people and after 0:01:59.800 --> 0:02:05.080 we overcome what is a terrible shock. Right now, markets 0:02:05.080 --> 0:02:07.880 are looking beyond the shock. Those of us who are 0:02:08.000 --> 0:02:11.359 living day to day lives are still living with the shock. 0:02:11.880 --> 0:02:15.720 And unfortunately a lot of folks are letting their guard 0:02:15.919 --> 0:02:19.120 down and they're getting sick, and when they do so, 0:02:19.520 --> 0:02:23.280 it's a tragedy. With healthcare workers, nurses. I saw a 0:02:23.320 --> 0:02:29.080 note Cleveland clinic as a thousand staff furloughed, not furload, 0:02:29.240 --> 0:02:33.239 but on medical leave because they're sick. So we're we're 0:02:33.240 --> 0:02:36.799 in the midst of the forest fire right now. And 0:02:36.880 --> 0:02:42.280 that's a sad tragedy for America and the world. Yeah, exactly, David. 0:02:42.520 --> 0:02:46.919 Are we going to see something catlest some catalysts arrive 0:02:47.080 --> 0:02:49.560 that sort of brings this market back to reality or 0:02:49.600 --> 0:02:52.359 is it just assuming that Joe Biden takes office and 0:02:52.400 --> 0:02:54.799 that you know, there's stimulus, that all those millions of 0:02:54.800 --> 0:02:57.600 people don't get a picked in January, that the unemployment 0:02:57.720 --> 0:03:00.280 it starts coming down quickly next year, and that you know, 0:03:00.280 --> 0:03:01.919 by the end of next year all as well in 0:03:01.960 --> 0:03:05.040 the world again. Well, I don't know they'll all be 0:03:05.160 --> 0:03:10.320 well in the world again, Vanny, but we certainly see 0:03:10.840 --> 0:03:21.160 markets looking to Biden calm, less disruption, more season professional 0:03:21.440 --> 0:03:27.840 government governance, and finally we are going to have a 0:03:27.880 --> 0:03:33.200 transition and all of this disruption of our electoral process 0:03:33.320 --> 0:03:37.360 looks like it's going to come to an end. And 0:03:37.440 --> 0:03:43.520 I think markets are celebrating the lack of disruption and 0:03:43.760 --> 0:03:48.800 chaos that we have seen. So it's a relief on 0:03:49.000 --> 0:03:52.640 top of what would be a v shape recovery outlook 0:03:52.720 --> 0:03:55.080 for next year and the year after. That's how it 0:03:55.120 --> 0:03:58.360 looks to me and David. It also is it relates 0:03:58.400 --> 0:04:01.040 to your outlook, or it appears that we have a 0:04:01.120 --> 0:04:04.760 very clear rotation trade. You know, out of some of 0:04:04.760 --> 0:04:07.440 those growthy names that have been really the stalwarts for 0:04:07.480 --> 0:04:09.920 this equity market really since financial crisis, whether it's an 0:04:09.920 --> 0:04:14.080 Apple or an Amazon, into more cyclical type of groups, 0:04:14.080 --> 0:04:16.280 whether it's banks or even even energy has had a 0:04:16.320 --> 0:04:20.919 great month. Um. Do you believe that's the play right here? 0:04:21.440 --> 0:04:24.800 And how long you think it could last? Well are 0:04:24.880 --> 0:04:28.320 two questions. So we use a little joke in the company. 0:04:28.400 --> 0:04:31.640 We say, Fang went to the dentist, and now we're 0:04:31.720 --> 0:04:35.320 going to have a broadening market. And I guess there's 0:04:35.320 --> 0:04:37.839 something to that. We see it in the small caps 0:04:37.880 --> 0:04:40.680 and we see it in the Russell two thousand um 0:04:41.760 --> 0:04:47.080 in our shop. We have uh good positions in the 0:04:47.160 --> 0:04:50.359 Russell two thousand in through the et F structure and 0:04:50.480 --> 0:04:55.240 in mid caps and small caps. So we've been enjoying 0:04:55.360 --> 0:04:59.200 the rally and we continue to do so. We we 0:04:59.320 --> 0:05:02.280 took advantage j of the sell off a few weeks ago, 0:05:02.400 --> 0:05:05.880 and we have been nearly fully invested to this surge. 0:05:06.320 --> 0:05:10.840 I admit that this is very fast, very robust, and 0:05:10.960 --> 0:05:14.039 every day we get up and look at it and 0:05:14.200 --> 0:05:17.400 we're terrified, and we don't sell anything in the next day. 0:05:17.720 --> 0:05:21.920 We say we're glad we waited. That's uh, that's where 0:05:21.920 --> 0:05:27.160 we are today in Thanksgiving week. Will you continue to 0:05:27.160 --> 0:05:31.640 stay in this market as that out help David Well, 0:05:31.720 --> 0:05:35.320 I I will for at least the next seven minutes, Vanny. 0:05:35.400 --> 0:05:38.800 But but after that, I'm not sure. Yeah, I think so, 0:05:39.000 --> 0:05:45.520 because when you put the robust recovery and the productivity 0:05:45.600 --> 0:05:53.680 games on top of this v shaped powerful uh fiscal stimulus, 0:05:53.720 --> 0:05:59.159 monetary stimulus you projected into two, you get an upward 0:05:59.200 --> 0:06:05.920 trajectory in earnings and it can be supplies in surprisingly robust. 0:06:06.000 --> 0:06:09.520 And I think there's a second kicker here, and that 0:06:09.720 --> 0:06:14.080 is the Biden administration lifts the lid on DOCTA. That's 0:06:14.160 --> 0:06:18.520 nine thou people who begin to flourish instead of hide 0:06:18.520 --> 0:06:21.760 behind the front door because they make it decordered. We 0:06:21.920 --> 0:06:26.520 change the immigration structure, and so we include, we increase 0:06:27.200 --> 0:06:31.240 the workforce, the labor force by allowing it to flourish. 0:06:31.400 --> 0:06:35.480 We bring back into the United States people. We need nurses. 0:06:35.960 --> 0:06:40.640 There's a there's a demand for million nursing care people. 0:06:40.960 --> 0:06:43.600 They would like to come to American work. I think 0:06:43.600 --> 0:06:46.159 they would like to still come to America. They used 0:06:46.200 --> 0:06:50.479 to want to do that. So If you add productivity games, 0:06:50.680 --> 0:06:57.239 which we're getting in huge amounts, to increase in working population, 0:06:58.000 --> 0:07:01.760 you accelerate the growth rate. I think we could hit 0:07:01.839 --> 0:07:05.159 growth rates above three percent, maybe even to four percent 0:07:05.560 --> 0:07:07.600 for a couple of years in g d P. If 0:07:07.600 --> 0:07:12.320 we get population and productivity, and we release the economy 0:07:12.440 --> 0:07:16.960 from chaos and from COVID, it could be an extraordinary 0:07:17.000 --> 0:07:20.520 couple of years. And the markets are saying that. Markets 0:07:20.520 --> 0:07:24.080 are saying those companies are going to reflect that in 0:07:24.160 --> 0:07:28.720 their earnings. And I believe that's not only possible, but 0:07:28.760 --> 0:07:32.680 I think it's becoming more and more likely as efficacious 0:07:32.880 --> 0:07:39.560 vaccines get into distribution. That's remarkable science being applied. Remarkable. David, 0:07:39.560 --> 0:07:41.880 how many milestones have we seen together in this market? 0:07:42.280 --> 0:07:44.680 There's not the reely rhetorical question because there's no time 0:07:44.720 --> 0:07:47.200 to answer it. But I can tell a listener is 0:07:47.240 --> 0:07:50.640 that me and David and Paul have seen very, very 0:07:50.640 --> 0:07:54.160 many milestones. That's David Kotalk, their chairman and chief investment 0:07:54.240 --> 0:08:01.480 officer at Cumberland Advisors, joining us from Sarazota, Florida. Well, 0:08:01.480 --> 0:08:04.720 we're certainly on a doll thirty thousand. Watch your three 0:08:04.840 --> 0:08:08.200 or seventy points here nine thousand, nine sixty two. Clearly 0:08:08.240 --> 0:08:11.480 equity investors are certainly willing to look past the dire 0:08:11.800 --> 0:08:14.160 pandemic numbers were experiencing right now, look to the other 0:08:14.200 --> 0:08:16.800 side of this in a world with a multiple vaccine. 0:08:16.840 --> 0:08:18.800 To get a sense of kind of where we should 0:08:18.840 --> 0:08:21.720 be looking in the market, we welcome Nicholas Co, founder 0:08:21.760 --> 0:08:24.120 of Data Trek Research based in New York City. Nick, 0:08:24.160 --> 0:08:25.840 thanks so much for joining us again here. What do 0:08:25.840 --> 0:08:29.280 you make of this equity market and are you surprised 0:08:29.320 --> 0:08:32.280 at all about the ability of this market to really 0:08:32.320 --> 0:08:36.440 look well towards the other side of this pandemic. You're right, 0:08:36.520 --> 0:08:40.480 it is absolutely impressive. I'm not all that surprised, only 0:08:40.559 --> 0:08:44.920 because you know, as a cyclicals oriented analysts, this very 0:08:45.000 --> 0:08:47.960 much fits the playbook of every recovery back to when 0:08:47.960 --> 0:08:51.160 I started looking at cycles in the early nineties covering 0:08:51.200 --> 0:08:54.640 the auto industry. So it's certainly a compressed version of 0:08:54.760 --> 0:08:58.120 thout cyclical recoveries, but it does fit the basic paradigm 0:08:58.160 --> 0:09:02.240 as much as any other one does. Small cap rallying industrials, rallying, financial's, 0:09:02.320 --> 0:09:06.480 rallying tech under performing, you know, against the backdrop of recovery. 0:09:06.480 --> 0:09:10.000 It makes all makes sense, What, then, Nick, should we 0:09:10.040 --> 0:09:14.719 expect next Well, I mean, obviously we've got a real 0:09:14.760 --> 0:09:17.160 head of steam on this market, and so you know, 0:09:17.200 --> 0:09:20.280 the next couple of particularly days is going to be 0:09:20.400 --> 0:09:23.520 a further continuation of the rally, particularly into light volume. 0:09:23.920 --> 0:09:25.520 But I do think there's going to have to be 0:09:25.640 --> 0:09:29.240 some kinds of reset back to some you know, more 0:09:30.280 --> 0:09:32.559 real form of reality, if you will, as we get 0:09:32.559 --> 0:09:34.920 into December and into the first part of next year. 0:09:35.000 --> 0:09:38.520 Because cyclical rallies always kind of blast off on hope, 0:09:38.559 --> 0:09:40.680 and that's what we're seeing right now. Then there's a 0:09:40.720 --> 0:09:43.199 real reality check when you start to see the numbers 0:09:43.240 --> 0:09:46.280 come through. And while earnings are definitely going to show 0:09:46.360 --> 0:09:49.240 leverage next year, you know, you don't never want to 0:09:49.280 --> 0:09:52.480 be around for when a company just meets expectations after 0:09:52.920 --> 0:09:54.960 a recession, they've got to keep beating them by a 0:09:54.960 --> 0:09:58.120 wide margin. So the new term setup is fine further 0:09:58.240 --> 0:10:01.960 out first half of next year much offer. So Nick, 0:10:02.040 --> 0:10:05.480 we see some more positive data points, I guess just 0:10:05.520 --> 0:10:08.600 on the geopolitical front, we're having president like Biden begin 0:10:08.679 --> 0:10:12.240 his transition, starting to fill out his cabinet, janet, yelling 0:10:12.480 --> 0:10:16.800 treasury pick, what are your thoughts very helpful for markets 0:10:16.880 --> 0:10:21.360 for I think probably all the obvious reasons, mostly, you know, 0:10:21.400 --> 0:10:25.800 having somebody who can coordinate treasury policy federal reserve policy 0:10:26.679 --> 0:10:29.319 and not necessarily emerge those two functions, but make them 0:10:29.320 --> 0:10:31.920 work as smoothly as possible, and we definitely need to 0:10:31.960 --> 0:10:35.760 help in they have fiscal and monetary policy work hand 0:10:35.800 --> 0:10:39.240 in glove. Also obviously an experienced set of hands for 0:10:39.320 --> 0:10:42.079 the economy. Somebody who is well known on Capitol Hill, 0:10:42.160 --> 0:10:45.320 somebody who can easily be be confirmed by the Senate. 0:10:46.120 --> 0:10:47.880 You know, just a huge thumbs up. It was a 0:10:47.920 --> 0:10:51.960 great choice. Who else would you like to see on board, Nick, 0:10:52.160 --> 0:10:55.600 in terms of regulation, in terms of everything else from 0:10:55.600 --> 0:11:00.720 the SEC too, you know, anybody lee thing with the banks. 0:11:02.280 --> 0:11:05.600 It's a wonderful question. Um, you know, without naming any 0:11:05.679 --> 0:11:08.000 specific names, I think what the market wants to see. 0:11:08.040 --> 0:11:10.360 You know, what Biden seems very much in the channel 0:11:10.400 --> 0:11:15.239 to do is just picked non controversial, easy to confirm, 0:11:15.640 --> 0:11:19.600 widely acceptable choices and really get the you know, get 0:11:19.600 --> 0:11:23.280 Washington back into the mainstream of governing the way it did, 0:11:23.840 --> 0:11:26.520 you know, for the last fifty years instead of the 0:11:26.600 --> 0:11:29.840 last four. So Nick, how about as it relates to 0:11:29.880 --> 0:11:32.960 the Federal Reserve chairman. Do you expect Pal to stay 0:11:33.200 --> 0:11:35.959 or do you think the market would prefer perhaps someone 0:11:36.040 --> 0:11:40.640 new Well, I mean, you know, Governor Brainers is obviously 0:11:40.720 --> 0:11:43.839 the one that people call out is the most likely 0:11:43.920 --> 0:11:47.400 potential next FED chare in two. I think the market 0:11:47.400 --> 0:11:51.360 would like that only in terms of her usually dovish 0:11:51.440 --> 0:11:55.120 bias Um and I think between you know, yelling and 0:11:55.160 --> 0:11:57.240 whoever comes in the next at the FED, the market 0:11:57.320 --> 0:12:01.479 is beginning to feel that incremental, really large bank regulation 0:12:01.720 --> 0:12:04.640 isn't coming down the road, and so you're seeing you know, 0:12:04.720 --> 0:12:07.160 names like well as Fargo really work today, the financials 0:12:07.160 --> 0:12:09.680 work today. That's really been a beaten up group, not 0:12:09.800 --> 0:12:12.400 just for rates being so low, because of the threat 0:12:12.440 --> 0:12:15.040 of more regulation. And as long as that doesn't that 0:12:15.080 --> 0:12:17.800 doesn't come down the road, whoever is the next bed share, 0:12:18.200 --> 0:12:22.080 you know, should the market should welcome. So we just 0:12:22.200 --> 0:12:27.600 had you know, retail sales reports that were pretty much okay, Nick, 0:12:27.760 --> 0:12:29.280 and yeah, we're seeing a little bit of a dent 0:12:29.360 --> 0:12:32.280 and consumer conferdence this month, but nothing you know massive. 0:12:32.559 --> 0:12:35.599 We're seeing housing, at least in suburban areas across the 0:12:35.600 --> 0:12:38.240 country holding up even more than that. It's on fire. 0:12:38.520 --> 0:12:43.360 How is this economy doing? Yes, okay, So on retail sales, 0:12:43.559 --> 0:12:45.920 very interesting point. I mean, we think we're going to 0:12:46.040 --> 0:12:51.360 see very strong November retail sales versus last year. NRF 0:12:51.480 --> 0:12:54.560 was out yesterday with a pretty positive forecast on retail sales. 0:12:54.920 --> 0:12:56.920 And just think about how much money is not being 0:12:56.960 --> 0:13:00.040 spent on holiday travel for example, that money is and 0:13:00.120 --> 0:13:02.560 I spent get spent on holiday and recamplers have been 0:13:02.679 --> 0:13:06.240 super aggressive on getting their specials out the door early, 0:13:06.280 --> 0:13:08.880 whether it be online or in store, and so we 0:13:08.920 --> 0:13:10.560 think November is going to be a very good month 0:13:10.559 --> 0:13:13.120 of retail sales, and that will fit with the data 0:13:13.160 --> 0:13:15.920 that we're seeing on home sales and home prices. We're 0:13:15.920 --> 0:13:18.600 a little more circumspect about December, however, because we think 0:13:18.600 --> 0:13:20.840 there's gonna be a lot of holiday demand pulled forward 0:13:21.200 --> 0:13:23.559 to November and won't be there in December. So I 0:13:23.600 --> 0:13:26.080 think the near term news is fine. We'll have to 0:13:26.080 --> 0:13:30.679 wait and see how December plays out and then refasts. Nick, 0:13:30.800 --> 0:13:34.040 just what is your forecast for when the Dow actually 0:13:34.040 --> 0:13:38.560 tops thirty? Oh, I don't know. I'm checking my watch. 0:13:39.640 --> 0:13:44.280 It's more along those lines um than anything else. I mean, 0:13:44.280 --> 0:13:47.280 it's a You know, it's that those people at discount 0:13:47.320 --> 0:13:49.760 these big round numbers as something that really doesn't matter 0:13:49.760 --> 0:13:52.400 to markets. I do think it matters to markets. If 0:13:52.400 --> 0:13:55.240 you look to see how many retail investors google Dow 0:13:55.360 --> 0:13:59.280 Jones versus S and P it's Dow Jones by like one, 0:13:59.360 --> 0:14:02.160 they'll know when the deal gets to thirty and it 0:14:02.400 --> 0:14:05.600 is a confidence lift, right, there is something to be 0:14:05.640 --> 0:14:07.880 said for it, right, Yeah, yeah, I think so. I mean, 0:14:07.880 --> 0:14:10.280 it's a nice it's certainly nice for financial journalists to 0:14:10.280 --> 0:14:11.880 talk about. But I think Nick, you're right. I mean, 0:14:11.920 --> 0:14:15.320 people do view it as a plateau to be to 0:14:15.400 --> 0:14:18.120 be achieved, so it can be important from that. Yeah, 0:14:18.120 --> 0:14:19.320 I mean, I think when you hit a round number, 0:14:19.520 --> 0:14:22.680 at least what at least what becomes very obvious is 0:14:22.680 --> 0:14:25.400 the direction, and if it's higher, well that's usually just 0:14:25.440 --> 0:14:28.080 the green light end of its lower world. Probably didn't 0:14:28.080 --> 0:14:30.280 see that one coming, Nick, Thank you so much. Nick 0:14:30.360 --> 0:14:33.760 Cholos is co founder of Data Track Research, always full 0:14:33.800 --> 0:14:40.040 of fascinating market insights daily, so we thank him for that. Well, 0:14:40.040 --> 0:14:42.480 if you want to travel internationally, you better get used 0:14:42.520 --> 0:14:45.880 to a new concept called a COVID passport. That's a 0:14:45.920 --> 0:14:47.760 new word I think is entering our minacular right now. 0:14:47.840 --> 0:14:50.840 Let's get some more details. We bring on Charlotte Ryan, 0:14:50.920 --> 0:14:54.920 aviation reporter for bloombergsh is based in London. Charlotte, what 0:14:55.240 --> 0:14:58.480 is a COVID passport? And do I need one? If 0:14:58.480 --> 0:15:02.120 I want to travel internationally? At some point? Good afternoon. 0:15:02.280 --> 0:15:05.600 So the COVID pass for it is an idea that 0:15:05.680 --> 0:15:10.320 we've seen a few organizations starting to explore, the most 0:15:10.400 --> 0:15:14.920 recent of those being AYATA, the International Air Transport Association. 0:15:15.400 --> 0:15:20.560 And basically what it is is UM, an online effective 0:15:20.720 --> 0:15:25.480 health status that would show your most recent COVID test 0:15:25.520 --> 0:15:29.960 results and whether you've had a vaccine when indeed a 0:15:30.040 --> 0:15:34.240 vaccine is available. And the idea is to link this 0:15:34.560 --> 0:15:38.080 UM with your travel documents so that when passengers travel, 0:15:38.800 --> 0:15:42.920 the airline or government that is accepting the passenger can 0:15:42.960 --> 0:15:47.000 immediately see their health status. Who would be the regulator 0:15:47.080 --> 0:15:52.760 for this? So that's a really good question, and it's still, 0:15:52.800 --> 0:15:55.520 in a sense a bit of an open question. We've 0:15:55.560 --> 0:15:58.720 got a few a few initiatives that are underway at 0:15:58.720 --> 0:16:02.240 the moment, and such a health path for its actually 0:16:02.320 --> 0:16:08.120 being trialed on routes in Asia, but it's not clear 0:16:08.600 --> 0:16:12.960 to what extend. Governments would have to be involved in this. Obviously, 0:16:12.960 --> 0:16:15.760 as we known from the travel disruption we've seen so 0:16:15.840 --> 0:16:19.880 far with the virus is up to the individual governments 0:16:19.920 --> 0:16:24.240 to decide under what conditions they want to let people in. UM. 0:16:24.280 --> 0:16:26.680 So that is very much something that still has to 0:16:26.720 --> 0:16:31.360 be resolved with these health path worts. So Charlotte, what's 0:16:31.360 --> 0:16:35.680 what's the position of airlines? Generally speaking, I would think 0:16:35.840 --> 0:16:38.440 they would be in favor of anything that would get 0:16:38.480 --> 0:16:43.000 people back in their seats. Yeah, exactly. So I mean 0:16:43.520 --> 0:16:46.600 we with this latest effor if I have, they're going 0:16:46.640 --> 0:16:50.160 to trial this with i D, one of the bigger 0:16:50.200 --> 0:16:54.720 airlines UM and they say that they're hoping to launch 0:16:54.800 --> 0:16:59.120 with other airlines as well. We've also had Quantis saying 0:16:59.280 --> 0:17:03.000 this week that once a vaccine is in place, they 0:17:03.160 --> 0:17:07.280 would not allow international passengers to travel unless they have 0:17:07.359 --> 0:17:10.720 been vaccinated. So there certainly is a willingness I think 0:17:10.760 --> 0:17:12.760 to get people back in the air and also to 0:17:12.760 --> 0:17:15.159 be as sure of passengers. But it is safe to fly, 0:17:15.920 --> 0:17:18.280 so I don't fully understand because many of them are 0:17:18.320 --> 0:17:22.680 not enforcing rules like mask wearing or you know, six 0:17:22.720 --> 0:17:25.960 ft apart separation in the planes. But suddenly they'd want 0:17:26.040 --> 0:17:30.880 you to prove that you've had a vaccine at some point. Yeah. 0:17:30.920 --> 0:17:33.520 So on the six ft rule, we did have a 0:17:33.560 --> 0:17:37.800 couple of US airlines that were putting not quite six feet, 0:17:37.800 --> 0:17:43.040 but putting a gap in between each cassenger. So I 0:17:43.040 --> 0:17:45.359 guess my point is that, you know, this doesn't seem 0:17:45.400 --> 0:17:48.119 to be right now. They don't seem to be worried 0:17:48.119 --> 0:17:52.760 about but too worried about, you know, enforcing certain rules 0:17:52.960 --> 0:17:56.360 that might help people not get COVID. But when there 0:17:56.440 --> 0:17:59.440 is a vaccine, suddenly they will be just explained that 0:17:59.480 --> 0:18:03.640 to me sure, So I think in terms of mass 0:18:03.680 --> 0:18:06.320 wearing at least, Um, you know, what we know from 0:18:06.320 --> 0:18:08.600 the airlines is they all they all say that they 0:18:08.600 --> 0:18:11.520 do enforced this currently. I know there have been cases 0:18:11.560 --> 0:18:16.040 of individual flights where people's say that that's not what's happened. Um, 0:18:16.080 --> 0:18:18.760 And I think, yeah. With the vaccine, I mean, I 0:18:18.800 --> 0:18:22.720 guess the advantage from the airline point of view is 0:18:22.760 --> 0:18:25.679 that it's this very clear indication if you get on 0:18:25.960 --> 0:18:30.160 a flight where everybody has been vaccinated, you know that 0:18:30.200 --> 0:18:34.000 you're you're pretty much safe. Whereas I think from the 0:18:34.040 --> 0:18:39.040 airline side of things, they have suggested that things like 0:18:39.080 --> 0:18:42.719 putting a seat in between passengers aren't necessarily that effective 0:18:42.800 --> 0:18:47.080 as something was spread anyway, Yeah, exactly, just real quickly, 0:18:47.080 --> 0:18:50.600 don't there any data that shows that people do get 0:18:50.600 --> 0:18:53.719 the virus from air traffic? I haven't seen many stories 0:18:53.720 --> 0:18:59.200 about that. Yeah, so this is still again a bit 0:18:59.200 --> 0:19:02.199 of an open question since what extent this virus in 0:19:02.280 --> 0:19:05.520 particular can spreads on aircraft. But we have had cases. 0:19:05.760 --> 0:19:09.800 I asked to think they've been around four fifty cases, 0:19:10.280 --> 0:19:13.520 which sounds like a lot, but it's worth highly in. 0:19:14.080 --> 0:19:16.320 A good chunk of those were on a couple of 0:19:16.359 --> 0:19:20.960 flights before the requirements where masks was brought in, and 0:19:21.040 --> 0:19:24.679 but certainly there have been cases where where the virus 0:19:24.680 --> 0:19:27.679 has spreads on the aircraft. It does seem that this 0:19:27.760 --> 0:19:30.880 has something to do with the fact that just today 0:19:31.280 --> 0:19:33.280 I had as predicting carriers will lose a combined one 0:19:33.640 --> 0:19:36.080 fifty seven billion dollars this year and next year, which 0:19:36.119 --> 0:19:40.080 is more than a forecast in June. So it also 0:19:40.240 --> 0:19:43.280 was getting things wrong. Charlotte. Wonderful story, Charlotte, Ryan, they're 0:19:43.359 --> 0:19:48.240 joining us well. I think for most people it appears 0:19:48.320 --> 0:19:52.440 that this work from home situation is working out fairly well. 0:19:52.600 --> 0:19:55.520 Now some companies are certainly think about what their staffing 0:19:55.640 --> 0:19:59.320 plans will be post pandemic. UH. Deutsche back coming out 0:19:59.359 --> 0:20:02.320 today and saying maybe they're considering on a permanent basis 0:20:02.320 --> 0:20:05.640 having their workers work two days a week at home 0:20:05.800 --> 0:20:08.200 on a permanent basis. Steve Aaron's is a German banks 0:20:08.200 --> 0:20:11.320 reporter for Bloomberg News. He joins us from Frankfurt. Steve, 0:20:11.359 --> 0:20:13.240 thanks so much for joining us here. So talk to 0:20:13.280 --> 0:20:16.159 us about the news today about Deutsche Bank. What are 0:20:16.160 --> 0:20:21.159 there their plans here post pandemic so UM, as with 0:20:21.240 --> 0:20:24.320 many other banks, Glergi Bank obviously has been thinking about 0:20:24.480 --> 0:20:27.080 its future once the pandemic is over. And it's been 0:20:27.200 --> 0:20:29.399 in the kind of work from home mode since the 0:20:29.400 --> 0:20:32.720 pandemic broke out in in earlier this year and and 0:20:32.800 --> 0:20:35.920 in February March, people have been working from the home. UH. 0:20:35.960 --> 0:20:38.560 They've been surprised as how well it's been working. And 0:20:38.640 --> 0:20:40.720 now they're coming to the conclusion that this can help 0:20:41.480 --> 0:20:46.320 UH lower costs and of course adapt to new circumstances, 0:20:46.400 --> 0:20:49.960 and therefore there now approaching a new policy where they 0:20:50.000 --> 0:20:52.119 will probably allow people are work from home to day 0:20:52.160 --> 0:20:55.560 the week. So is it though, that you can work 0:20:55.560 --> 0:20:59.520 home any two days you choose, because we know from 0:20:59.720 --> 0:21:01.880 chat with hedge fund managers and various people who talk 0:21:01.920 --> 0:21:04.000 to us about how their offices are staff that right 0:21:04.000 --> 0:21:05.840 now Friday is not a very popular day for people 0:21:05.880 --> 0:21:07.760 to come in, and neither is Monday. So are we 0:21:07.760 --> 0:21:11.240 going to have of deute buying stuff in on Tuesday, Wednesday, 0:21:11.280 --> 0:21:16.280 Thursday and the rest, you know, not in Monday Friday. Yeah, 0:21:16.359 --> 0:21:18.960 I'm not entirely sure how Dodge Bank will handle it, 0:21:19.080 --> 0:21:22.680 but you're right, obviously that would be probably a very 0:21:22.760 --> 0:21:26.080 heavy focus on Friday and Monday to work from home. 0:21:26.560 --> 0:21:28.720 I'm pretty sure they will have policies in place that 0:21:28.840 --> 0:21:31.119 won't permit that, though I don't have really insight knowledge 0:21:31.119 --> 0:21:32.960 and that, but yeah, I think a lot of companies 0:21:33.080 --> 0:21:35.880 are trying to figure out. I mean, most likely scenario, 0:21:35.880 --> 0:21:39.160 in my opinion, is to have you know, binding agreement 0:21:39.200 --> 0:21:40.959 in place for certain days of the week and then 0:21:40.960 --> 0:21:44.440 they will ensure it's sort of even it evens out, 0:21:44.680 --> 0:21:47.040 and then if you don't get Friday on Monday, and 0:21:47.320 --> 0:21:50.359 I guess you're locked out. So, Steve, do you have 0:21:50.440 --> 0:21:52.520 any sense or do Stuorte Bank have any sense at 0:21:52.520 --> 0:21:55.760 this point as to what types of people would be 0:21:55.800 --> 0:21:58.719 given this work from home opportunity. I would think they 0:21:58.720 --> 0:22:01.480 would want their traders in, maybe their investment bankers in 0:22:01.600 --> 0:22:03.720 every day. So it's just more of a back office 0:22:03.720 --> 0:22:09.560 type thing. Yeah, I guess that's another important consideration, right, Traitors, 0:22:09.600 --> 0:22:12.040 for compliance reasons and many other reasons, need to be 0:22:12.080 --> 0:22:14.920 at their death in the office a lot of the time, 0:22:15.000 --> 0:22:18.160 so it's likely that they may have only one day 0:22:18.240 --> 0:22:21.920 or no days. Um, that's certainly something that is still 0:22:21.920 --> 0:22:26.399 working on UM and uh in the same goes for 0:22:26.600 --> 0:22:30.520 UM client facing people who travel a lot UM. So yeah, 0:22:30.560 --> 0:22:33.440 I think we're mostly talking about the back office you're 0:22:33.400 --> 0:22:35.640 aware of. Working from home is much less of an issue. 0:22:35.680 --> 0:22:38.760 And then for the other stuff, so you know, not 0:22:38.800 --> 0:22:42.400 that money companies have put out formal blueprints because nobody 0:22:42.400 --> 0:22:44.239 knows who, nobody knows how long the pandemic is going 0:22:44.240 --> 0:22:46.400 to last one, vaccines are going to be available, at 0:22:46.400 --> 0:22:48.320 what point their workers are going to be able to 0:22:48.359 --> 0:22:51.400 access vaccines and so on. Why do dot de bank 0:22:51.440 --> 0:22:55.040 decide to do this now? Well, it's not it's not 0:22:55.440 --> 0:22:58.760 a formal announcement, right, we booked the news. It's people 0:22:58.760 --> 0:23:02.359 familiar U However, there are banks European banks who have 0:23:02.560 --> 0:23:07.879 made sort of preliminary announcements. What they're planning is um 0:23:07.960 --> 0:23:11.320 and they're ranging from twenty to fifty on Dutch banks 0:23:11.320 --> 0:23:14.000 and said they will allow fifty percent of staff to 0:23:14.000 --> 0:23:17.199 work from home. So I just think it's you know, 0:23:17.240 --> 0:23:19.280 we've had a trial line of working from home since 0:23:19.320 --> 0:23:21.720 the beginning of this year. They realize it's working well, 0:23:22.040 --> 0:23:24.000 and now you know, you have to consider if you 0:23:24.000 --> 0:23:26.359 want this to impact your policies. You have nieces in place, 0:23:26.400 --> 0:23:28.520 if you want to reduce office space, you have to 0:23:28.520 --> 0:23:30.880 start doing this now because it will play out over 0:23:30.920 --> 0:23:33.359 a very long period of time. Also, you need to 0:23:33.359 --> 0:23:36.000 talk to regulators about install on. If you don't make 0:23:36.040 --> 0:23:38.960 a decision at some point, um, it's gonna just you're 0:23:38.960 --> 0:23:42.600 gonna delay the whole implementation for a long time. So, Steve, 0:23:42.640 --> 0:23:45.359 I wonder how much of this is really a cost 0:23:45.440 --> 0:23:47.800 cutting move here. I mean, you know better than anybody 0:23:47.840 --> 0:23:52.160 the difficulty that German banks have been dealing with four years, 0:23:52.240 --> 0:23:56.240