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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern

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Speaker 1: on Apple CarPlay or Android Auto with the Bloomberg Business App.

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Speaker 1: Listen on demand wherever you get your podcasts, or watch

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Speaker 1: us live on YouTube.

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Speaker 2: Joining us now from the sunny clines of his Aruba,

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Speaker 2: his Dutch Caribbean Urie Timer, who grew up in the

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Speaker 2: Caribbean and of course iconic at Fidelity Investments, Urine, I've

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Speaker 2: got to get to your brilliant work on LinkedIn, folks.

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Speaker 2: Just simply follow Urine Timer on LinkedIn. While the nifty

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Speaker 2: to fifty remains far from evaluation extremes, here's where we are.

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Speaker 2: How extreme are we right now? Uri and Timmer?

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Speaker 3: So the nifty fifty good morning, by the way. So

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Speaker 3: the top fifty companies which in you know, years, past,

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Speaker 3: decades past, have had occasional unsustainable valuation moves. So the

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Speaker 3: original nifty to fifty in the early seventies, and then

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Speaker 3: of course what we used to call the Jenus twenty

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Speaker 3: back in the late nineties, and at the peaks those

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Speaker 3: stocks would trade at two x the pe of the

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Speaker 3: bottom four fifty Today it is nowhere near there. It's

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Speaker 3: about twenty five thirty percent. But if you take just

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Speaker 3: the mag seven, of course, which are the booster children

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Speaker 3: of the mega growers, they're trading at about a thirty

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Speaker 3: eight pe, whereas the bottom four ninety three in the

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Speaker 3: S ANDP are trading at about twenty two. So there

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Speaker 3: we are getting closer to sort of historical extremes. But

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Speaker 3: having said that, you look at the earning squiggles and

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Speaker 3: I get them from Bloomberg. You look at those sort

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Speaker 3: of next twelve month numbers, next twenty four months number.

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Speaker 3: They are still not only rising but accelerating, so you

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Speaker 3: get both sequential improved moquents from one calendar year to

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Speaker 3: the next in the estimates, And those estimates themselves are

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Speaker 3: rising rapidly, more rapidly than the market in general. So

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Speaker 3: until they lose that fundamental support from rising earning estimates,

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Speaker 3: which are known to be a proven driver for future returns,

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Speaker 3: I think these valuations can still be sustained.

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Speaker 2: And David to me, the delta announcement what four or

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Speaker 2: five days ago was extraordinary. How they just blew it

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Speaker 2: out and they just killed it.

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Speaker 4: You're in I look at what I'm going to keep

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Speaker 4: hammering on this this morning for the lack of breadth

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Speaker 4: in the market, and I wonder if what's old is

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Speaker 4: new again kind of looking back at two thousand and three,

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Speaker 4: parts of tw twenty twenty three, parts of twenty twenty four,

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Speaker 4: how much is that weighing on you, just sort of

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Speaker 4: the increasing narrowness of this market.

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Speaker 3: Yeah, it's a great observation. And I was really taken

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Speaker 3: aback in December by how quickly the breath in the

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Speaker 3: market sort of evaporated, right, So just to dial the

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Speaker 3: clock back in twenty twenty, So twenty two October we

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Speaker 3: had the cyclical bull market. Begin twenty twenty three was

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Speaker 3: a very good year for the SMP, but if you

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Speaker 3: were not in the MAC seven, you were not feeling

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Speaker 3: the joy because there was no participation from anything else,

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Speaker 3: even though the S and P went up, you know,

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Speaker 3: over twenty percent. Then in then in late twenty three,

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Speaker 3: when the Fed pivoted and the Treasury kind of did

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Speaker 3: its debt management, you know, going away from long dated

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Speaker 3: stuff to T bills, the market really broadened. And throughout

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Speaker 3: most of twenty twenty four, you know, seventy five eighty

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Speaker 3: percent of stocks were in up trends above their two

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Speaker 3: in a day moving average, even though they could not

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Speaker 3: quite compete with the Max seven, but you did have

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Speaker 3: a broad market, a bullish broadening. Now we're back to

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Speaker 3: like fifty to fifty five percent above their two inundred

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Speaker 3: day and as of two days ago, only about a

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Speaker 3: quarter of the stock were above their fifty day moving average,

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Speaker 3: and so that's not good to see, and it kind

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Speaker 3: of brings us back to the twenty twenty three environment.

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Speaker 3: I hope it changes because the earnings growth is there

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Speaker 3: and it is relatively broad based. You mentioned the Delta news.

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Speaker 3: That's case in point, and it's not like the other

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Speaker 3: stocks in the S and P are not doing anything.

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Speaker 3: It's just that they can't really light a candle to

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Speaker 3: the mag seven because they are so far out in front.

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Speaker 4: A novice like me once some guidance from a pro

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Speaker 4: like you. How much are you watching the ten year

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Speaker 4: and amidst all of the anxiety and adjucta surrounding it

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Speaker 4: moving toward five percent? How much does that matter? How

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Speaker 4: much is that merely a psychological threshold or is it

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Speaker 4: something that portends some kind of change in market sentiment

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Speaker 4: and where things are going?

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Speaker 3: It matters a great deal. So when you think about

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Speaker 3: equity valuation right discounted cash flow model, you got earnings

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Speaker 3: growth in the numerator, the cost of capital in the denominator,

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Speaker 3: and the new luminator. The numerator is more powerful.

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Speaker 2: Right.

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Speaker 3: If you get good earnings growth, the market can withstand

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Speaker 3: changes in interest rates. But you know a few years

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Speaker 3: ago during COVID, when you look at the FED model,

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Speaker 3: which compares the pe on bonds, right, the price that

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Speaker 3: investors pay for future coupons, and you compare that to

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Speaker 3: the pe on equities. In twenty twenty, bonds were ninety

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Speaker 3: one percent more expensive than stocks. So it was very

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Speaker 3: low hanging fruit for the stock market to do well

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Speaker 3: because they had no competition from what we consider the

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Speaker 3: risk free asset. Now, bonds are fifteen percent cheaper than stocks,

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Speaker 3: even though bonds should be more expensive because they are

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Speaker 3: considered the risk free asset, although some people might argue

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Speaker 3: with that these days. And so as yields rise and

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Speaker 3: bonds have become viable, right, so we're at four point

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Speaker 3: seventy nine percent, tips are in the mid two so

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Speaker 3: you're getting a real yield that is significantly positive, and

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Speaker 3: you have now a positive bonds to stocks correlation. You're

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Speaker 3: at a point now where stocks need to compete with

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Speaker 3: bonds to be that viable, risky asset. And when bond

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Speaker 3: yields go up let's say four and a half five,

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Speaker 3: when they get into that zone, the stock market starts

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Speaker 3: to wobble, which doesn't mean the end of the bullmarket

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Speaker 3: for stocks, but you know, it interrupts the mojo, as

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Speaker 3: I've been calling it. And we saw that in twenty

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Speaker 3: twenty three, obviously twenty twenty two, and we're seeing it

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Speaker 3: again today.

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Speaker 2: Quickly, Urine, what is the length of this bull market?

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Speaker 2: You've got a wonderful I'm going to be polite and

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Speaker 2: called a spiral chart out on LinkedIn that shows a

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Speaker 2: duration of a bull market on a baseball And he's

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Speaker 2: Dutch Caribbean. What can I do on a baseball standpoint?

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Speaker 2: I mean, I mean, Urine's up in Boston. He doesn't

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Speaker 2: go to Fenway anymore. It's been so difficult. But are

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Speaker 2: we in the third inning or the eighth inning? Urin?

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Speaker 3: I think we're closer to the seventh or eighth inning.

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Speaker 3: And when you think about the all bull markets over

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Speaker 3: the past one hundred plus years, the median bullmarket lasts

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Speaker 3: thirty months and produces a ninety percent gain. Our bullmarket

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Speaker 3: is twenty seven months old and has produced about a

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Speaker 3: seventy five percent price gain. But of course the median,

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Speaker 3: you know, is the median, and there's wide, wide dispersion.

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Speaker 3: I mean, the nineteen ninety five bull market lasted for

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Speaker 3: much much longer than that, and certainly there are parallels

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Speaker 3: to that, but the whole AI theme. But when you

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Speaker 3: go back to periods in time where rates mattered, as

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Speaker 3: we just discussed, the bull markets tend to be more

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Speaker 3: sort of average, and I'm thinking like nineteen sixties, in

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Speaker 3: nineteen eighties. So I think we're in later innings, and

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Speaker 3: you know, the momentum of the valuation push I think

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Speaker 3: is behind us. Now it's all up to earnings which

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Speaker 3: are coming through. But now you get these cross currents

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Speaker 3: of the FED being done and rising rates, and it

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Speaker 3: will occasionally interrupt and slow down this bowl.

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Speaker 2: Sim Martin sat Stacius. I hope I'm pronouncing that right.

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Speaker 2: Saba curso bonaire. And you're in timmer this morning, folks,

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Speaker 2: and for those on YouTube can see the joy is

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Speaker 2: in arubaur in Timor. Is your Dutch Caribbean the same

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Speaker 2: as your childhood.

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Speaker 3: It is a lot busier than it was. But so

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Speaker 3: I was born here in nineteen sixty two along with

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Speaker 3: my two brothers. My parents lived here for three and

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Speaker 3: a half decades. My father was sent here in nineteen

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Speaker 3: fifty for the military service. My parents are ninety and

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Speaker 3: ninety seven. They retired to Holland back in the nineteen eighties,

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Speaker 3: but this is the one trip they still make and

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Speaker 3: my parents are here, and that's why I'm here because

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Speaker 3: I don't want to miss any minutes with them. So

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Speaker 3: my parents and their three sons are under the same

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Speaker 3: roof in my brother's house. And but the island is

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Speaker 3: much much busier. There are more hotels, there's a lot

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Speaker 3: of ARABNB. So when I go to the supermarket because

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Speaker 3: I like to cook here every night, there are so

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Speaker 3: many tourists who are airbnbing and therefore are cooking themselves.

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Speaker 3: And that's, of course, it's great to see. It's not

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Speaker 3: a criticism, but it's different from the sleepy days when

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Speaker 3: I grew up here.

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Speaker 4: Tom taking notes, you're gonna get that note taking notes

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Speaker 4: for the president of Airbnbreckman day.

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Speaker 2: You're in Timber get in line. Can we look at

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Speaker 2: the Dutch Caribbean as a fifty second star?

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Speaker 4: All in good time, Tom.

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Speaker 2: You're in timer. Thank you so much from Aruba, and

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Speaker 2: just good morning to your parents as they celebrate with

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Speaker 2: you and your family in a Ruba. That's really cool.

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Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live

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Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

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Speaker 1: Apple Karplay and Android Atto with the Bloomberg Business app,

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Speaker 1: or watch us live on YouTube.

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Speaker 2: The the report and CPI tomorrow. And we have someone

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Speaker 2: right now absolutely definitive on this. Stephen Stanley is chief

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Speaker 2: economist at Santander and has decades of extinguishment of having

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Speaker 2: trophies on the mantle for getting it right. Is it

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Speaker 2: tough to measure CPI now or do you feel like

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Speaker 2: you got to handle on the guestimate for tomorrow?

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Speaker 5: Yeah? I think that what's been tough lately has been

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Speaker 5: the translation from CPI to the PCE deflator, which is

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Speaker 5: obviously to what the FED wants, the FED pays attention to,

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Speaker 5: because we've had consistent point three s on the core

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Speaker 5: CPI and some months that translates to a high PCE

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Speaker 5: number and some months to a low PCE number. So

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Speaker 5: that's that's really been the difficulty lately.

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Speaker 2: How does real estate rental homeownership plug into this madness?

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Speaker 5: So, I mean, it's far and away the biggest piece

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Speaker 5: of the core CPI. It's over forty percent of the

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Speaker 5: core CPI.

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Speaker 2: It should be, That's what I mean. I mean Lisa's

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Speaker 2: rent and she's putting eighty percent of her paycheck monthly

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Speaker 2: rent forty All.

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Speaker 5: Right, yeah, yeah, it's less in the core PCEE, but

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Speaker 5: it's clearly an important part of the puzzle right now.

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Speaker 5: Fed uh Palell and others of the FED have been

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Speaker 5: talking about how this was going to come down for

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Speaker 5: a long time, and it really hasn't until last month

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Speaker 5: we got a low reading and so we're waiting, I think,

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Speaker 5: to see whether that was a fluke or the beginning

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Speaker 5: of a better trend.

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Speaker 4: As we look ahead to getting these data in just

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Speaker 4: a few minutes and CPI tomorrow, what would be most

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Speaker 4: worrisome for you to see as you look at it

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Speaker 4: on a more granular level.

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Speaker 5: Well, I think that you know, the really important piece

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Speaker 5: of this right now in terms of core inflation has

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Speaker 5: been on the services side, So you know, housing is

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Speaker 5: the biggest chunk of that, but certainly medical care services,

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Speaker 5: financial services, they're you know, a handful of these big

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Speaker 5: services categories that really paying attention to and where you're

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Speaker 5: going to have to see progress if we're going to

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Speaker 5: get back to two percent inflation.

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Speaker 4: It's the FED too narrowly looking at these data.

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Speaker 6: Now.

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Speaker 4: We hear a lot about being data driven versus a

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Speaker 4: point driven. Are you worried that there is a tendency

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Speaker 4: here to look at these one by one, not with

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Speaker 4: any sort of average or longer term horizon.

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Speaker 2: Absolutely.

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Speaker 5: I mean my sense is that we've had kind of

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Speaker 5: strings of good and then bad data. You know, we

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Speaker 5: had high data at the beginning of twenty twenty four,

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Speaker 5: then it came down a little bit, then back up,

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Speaker 5: and it seems like every time you get that little shift,

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Speaker 5: the FED is swinging violently from hawkish to dubvish and

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Speaker 5: back again. So yeah, I'd like to see them a

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Speaker 5: little provide a little bit more stability on that front.

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Speaker 2: But what Global Wall Street wants to know from you,

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Speaker 2: is a disinflationary vector still in place.

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Speaker 5: I think it is. I think that we're going to

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Speaker 5: see gradual improvement. It's going to be slow, but I

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Speaker 5: think we are as as time passes.

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Speaker 2: Theoretically an extended axis. It's going to be slow. Is

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Speaker 2: beneficial to embed in anchor a lower inflation, right is physics?

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Speaker 2: One oh one?

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Speaker 4: Did you do physics in high school?

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Speaker 2: In high school? I mean, but isn't the slow disinflationary

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Speaker 2: tendency better? For John Williams Well.

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Speaker 5: I mean, you know, ideally, I think the FED would

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Speaker 5: like to be at two percent yesterday, right, And I

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Speaker 5: think the stubbornness of inflation running above their target has

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Speaker 5: been somewhat frustrating to them. But I do think on

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Speaker 5: an underlying basis, we are seeing slow We're seeing slow deceleration.

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Speaker 5: So I think we'll eventually if we, you know, stay

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Speaker 5: the course, we'll eventually get to two percent. But it's

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Speaker 5: not going to happen in the next month or two.

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Speaker 2: The analysis here for surveillance worldwide is boom. Stephen Stanley

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Speaker 2: with us as well. Stephen, you're not looking at the

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Speaker 2: data but across the board a disinflationary tendency. What happens

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Speaker 2: if we get that tomorrow with CPI wow, I think

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Speaker 2: talking about whiplash.

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Speaker 5: The FED would be very happy with that. I will say,

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Speaker 5: there's the relationship between the PPI and CPI. How can

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Speaker 5: we put it. It's ten us and I thought we'd

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Speaker 5: get a lower PPI number today, but I have a

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Speaker 5: high CPI number tomorrow. So I don't think this necessarily

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Speaker 5: should give us a ton of comfort.

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Speaker 2: Okay, so you're gonna wait to see what the tomorrow's

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Speaker 2: for sure. The deity is the PPI for those younger,

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Speaker 2: it's not the same structure or model. Is the PPI

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Speaker 2: we were schooled one years ago, that's right? Yeah, how

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Speaker 2: is it different now?

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Speaker 5: So the BLS has begun, I don't know, it's been

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Speaker 5: about ten years now, has begun to try to measure

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Speaker 5: service prices at the producer level. So in the old days,

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Speaker 5: the PPI was just only goods prices at the wholesale level.

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Speaker 5: And you know, some of these things, it's it's kind

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Speaker 5: of hard to get a read on because you know, honestly,

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Speaker 5: there is no wholesale market for most surfaces, right, So

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Speaker 5: I think the methodology is quite different. What's important about

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Speaker 5: the PPI now though, is that for some of those

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Speaker 5: services categories, the BEA uses the PPI data rather than

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Speaker 5: the CPI data to calculate the pc deflator items?

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Speaker 2: Are you kidding all this? I feel like I'm in

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Speaker 2: secretary excess kind of God looking at the alphabet soup.

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Speaker 2: David has saved me here.

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Speaker 4: Stean, we were talking just a moment ago about the

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Speaker 4: kind of vacillation we've seen between the FED being hawkish

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Speaker 4: and dubvish as we do this kind of economic ornithology here,

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Speaker 4: we're seeing a more dubbish Stephen Stanley as well here

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Speaker 4: in the studio as of late. How are you navigating

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Speaker 4: all of this? How are you putting this together? And

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Speaker 4: how's it sort of shaping this? Yes, the inflation data today,

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Speaker 4: but the labor market data we got last week. How's

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Speaker 4: it changed your vantage here on what's going to happen

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Speaker 4: going forward?

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Speaker 5: Yeah, Well, as you mentioned, I mean I've actually been

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Speaker 5: pretty dubbish lately, which is a r Yes, I'm usually

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Speaker 5: the hawk in the room. So I think that the

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Speaker 5: economy is likely to be slower in the near term.

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Speaker 5: And I think the main the easy explanation for that

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Speaker 5: is that businesses are uncertain. We've got a lot of

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Speaker 5: policy questions to be resolved, and so I think a

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Speaker 5: lot of businesses that probably even though they've we've seen

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Speaker 5: business optimism pick up, I think businesses are sitting on

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Speaker 5: the sidelines waiting to see so I think that for me,

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Speaker 5: the first half of twenty twenty five should be the

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Speaker 5: slowest period, and then as we get certainty on policy,

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Speaker 5: I think things start to pick up again. The question

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Speaker 5: really is, are we getting a slow down in the

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Speaker 5: labor market? Last Friday's numbers would say no, you know,

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Speaker 5: I would argue that we're still slowly seeing job growth moderate.

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Speaker 5: I do think the unemployment rate will tick up a

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Speaker 5: little bit in twenty twenty five, and that gives the

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Speaker 5: Fed a little bit of a reason maybe to move

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Speaker 5: closer to their view if we're neutralists.

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Speaker 2: Steven Sanley, thank you so much with sentender this morning.

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Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday

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Speaker 1: starting at seven am Eastern on Applecarplay and Android Otto

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Speaker 1: with the bloom Business Up. You can also listen live

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Speaker 1: on Amazon Alexa from our flagship New York station, Just

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Speaker 1: say Alexa Play Bloomberg eleven thirty.

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Speaker 2: Sarah House joins us now senior economist at Wills Fargo.

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Speaker 2: Sarah rates higher, Does that just simply mean, we got

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Speaker 2: a better animal spirit, a better inflation, a better nominal GDP,

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Speaker 2: and that will fold over to a good earning season.

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Speaker 2: Is that what you're here from Securities Research at Wells Fargo.

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Speaker 7: Yeah, so, I think that's a big part of the

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Speaker 7: lift and rates that we've seen as we've continued to

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Speaker 7: see a really strong performance of the US economy, whether

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Speaker 7: it's in some of the more growth related indicators like

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Speaker 7: the consumer spending and we'll get a look at retail

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Speaker 7: sales later this week, but also just as we've seen

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Speaker 7: the labor market firm up as well, I think that's

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Speaker 7: pointing to consumers still have money in their pockets that

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Speaker 7: they're spending, which I think all should still be pretty

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Speaker 7: beneficial for corporate earnings growth that continue to I think

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Speaker 7: also have that positive the backupfact with the labor market,

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Speaker 7: so support supporting headcamp.

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Speaker 4: Sarah, give us the battlefield report here as we look

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Speaker 4: at the Fed's fight against ty inflation and the data

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Speaker 4: that we got this morning that miss on Producer price

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Speaker 4: index looking ahead to CPI tomorrow, where is the FED

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Speaker 4: in this fight? And I wonder about the longevity of

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Speaker 4: this two percent target going forward? Here it strikes me

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Speaker 4: that we were kind of in this vacuum of a

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Speaker 4: sort when we didn't have all of the uncertainty surrounding

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Speaker 4: tariff's policy or immigration policy or fiscal policy. Now that

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Speaker 4: we introduce all of that, do you think we're going

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Speaker 4: to see a FED, shall we say, place less emphasis

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Speaker 4: on that going forward.

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Speaker 2: Yeah.

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Speaker 7: So I think this is the hardest part of the

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Speaker 7: inflation fight. So early on, we had I think some

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Speaker 7: pretty low hanging fruit when we think about unwinding supply chains,

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Speaker 7: just the normalization and commodity prices after the Russian invasion

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Speaker 7: of Ukraine. But this is the harder part where we're

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Speaker 7: still seeing pretty good growth, as we talked about, but

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Speaker 7: that doesn't leave a lot of incentive for firms to

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Speaker 7: really pair back in terms at the rate of which

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Speaker 7: they're increasing prices, and I think they've they've relearned that

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Speaker 7: you can increase price without losing volume in any material way.

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Speaker 7: And so I think that does make it a pretty

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Speaker 7: difficult position for the FED, and ultimately this inflation fight

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Speaker 7: is not over.

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Speaker 2: Sarah House, I've got to ask here, we're deep after

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Speaker 2: PPI forty minutes on, have you readjusted your view to

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Speaker 2: CPI tomorrow after witnessing the disinflation of eight thirty this morning.

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Speaker 7: Now having may changes to what we're looking for for

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Speaker 7: CPI tomorrow. These are separate surveys.

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Speaker 2: You know.

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Speaker 7: There are a few parts of it that are are

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Speaker 7: pretty highly correlated with CPI, like for example, consumer food prices,

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Speaker 7: but for the most part, these are looking at inflation

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Speaker 7: from different surveys and different perspectives, so those from what

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Speaker 7: consumers are paying versus those of what producers are receiving.

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Speaker 7: This is more important for the PC deflator. So we

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Speaker 7: were kind of looking at what core PC and headline

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Speaker 7: PC are tracking for December. Now that we got inputs

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Speaker 7: like in terms of medical care, a lot of information

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Speaker 7: on finance and insurance, as well as what happens in

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Speaker 7: transportation costs. So tweaking that up maybe slightly, maybe modestly,

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Speaker 7: just with the strength bus on in airfares, But it

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Speaker 7: doesn't look like this is a wholesale change in terms

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Speaker 7: of the inflation numbers for December when we look at

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Speaker 7: them in totality, Sarah, we.

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Speaker 4: Have speaking of looking at in totality, I'd love to

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Speaker 4: kind of look at these data in complement with what

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Speaker 4: we got last week that the jobs data, the FED

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Speaker 4: doing its balanced dance, you doing that as well. How

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Speaker 4: do you see the two of them in complement, and

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Speaker 4: how did it kind of change your perspective, if at all,

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Speaker 4: on what the Fed's going to do here in the

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Speaker 4: months ahead.

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Speaker 2: Yeah.

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Speaker 7: So, what I think we've really seen, especially coming out

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Speaker 7: of the December jobs report, is that the scare that

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Speaker 7: we had this summer over the labor market, where we

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Speaker 7: certainly saw it weakening, and I think there was a

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Speaker 7: lot of concern that it was going to deteriorate in

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Speaker 7: a nonlinear way. I think those canerns have been set aside,

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Speaker 7: and so I think that's allowing the FED to shift

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Speaker 7: its focus back more firmly on inflation, to finish this

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Speaker 7: fight to get inflation all the way back down to

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Speaker 7: two percent. And I think with fewer risks right now

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Speaker 7: being posed to the labor market, that it does point

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Speaker 7: to rates I think staying potentially where they are for

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Speaker 7: for longer than maybe what a lot of folks were

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Speaker 7: expecting in the final months of next year. So I

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Speaker 7: think market's pushing out the timing of that next cut,

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Speaker 7: and you know, the degree to which we even see

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Speaker 7: any further cuts in the near chairament I think is appropriate.

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Speaker 2: I look, Sarah at the American economy, and you know,

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Speaker 2: Joe Wisenthal had a great tweet out, Yeah, David Gerr,

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Speaker 2: we're deep into twenty twenty five.

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Speaker 6: Very deeply.

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Speaker 2: It's like we're two weeks, two weeks. It was like

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Speaker 2: we're in three, four or five six months. Sarah, do

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Speaker 2: you feel like you have to remodel your twelve thirty

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Speaker 2: one model? I mean, is there a are I sure

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Speaker 2: to readjust now?

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Speaker 7: I don't think there's there's a big pressure. I mean,

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Speaker 7: it has felt like a long first two weeks of

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Speaker 7: the year with everything that's gone on. But I think

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Speaker 7: you're still looking at in an environment where inflation is

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Speaker 7: going to be a bit sticky. It's going to be

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Speaker 7: really hard I think to move the dial a lot

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Speaker 7: further in terms of getting inflation back down to the

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Speaker 7: FEDS two percent target. So heading into the year, we're

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Speaker 7: looking for inflation to more or less move sideways this year,

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Speaker 7: and I think that's that's still consistent with the data

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Speaker 7: that we've seen over the past few weeks. But I

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Speaker 7: think probably the bigger shift has been I think further

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Speaker 7: firming in the labor market, which again just reduces I

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Speaker 7: think some of the concern on the employment side of

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Speaker 7: the Fed's mandate.

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Speaker 2: Sarah House, thank you so much for sharing us today

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Speaker 2: with Wills Fargo.

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Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday

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Speaker 1: starting at seven am Eastern on Apple Corplay and Android

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Speaker 1: Auto with the Work Business up. You can also watch

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Speaker 1: us live every weekday on YouTube and always on the

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Speaker 1: Bloomberg terminal your daily look.

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Speaker 2: The front page is a Lisa Matteo moment, Lisa, do

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Speaker 2: you have okay?

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Speaker 6: I found this story in the Wall Street Journalists because

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00:23:13,680 --> 00:23:16,400
Speaker 6: this is usually the time when people tend to quit

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00:23:16,520 --> 00:23:20,720
Speaker 6: their New Year's fitness resolution already. They usually last two weeks. Yeah,

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00:23:20,720 --> 00:23:23,600
Speaker 6: they're usually about two weeks into the new year. But

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00:23:23,680 --> 00:23:26,240
Speaker 6: there's a lot of people who have not been happy.

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00:23:26,240 --> 00:23:29,720
Speaker 6: But it's the gym regulars have been very frustrated because

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00:23:29,920 --> 00:23:32,160
Speaker 6: they always say it happens every year. The gyms are packs.

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00:23:32,160 --> 00:23:33,840
Speaker 6: They can't get a shower, they can't get a locker,

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00:23:33,880 --> 00:23:37,560
Speaker 6: they can't get on a treadmill, the parking lot is full,

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00:23:39,320 --> 00:23:41,800
Speaker 6: and they said they don't know the gym etiquette. There

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00:23:41,800 --> 00:23:42,640
Speaker 6: is a certain job.

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00:23:42,600 --> 00:23:45,479
Speaker 4: Not wiping off the peloton exactly.

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00:23:45,040 --> 00:23:46,840
Speaker 6: You have to wipe off the palatine.

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00:23:48,760 --> 00:23:50,639
Speaker 2: For those of you that don't know, the Sun Radio,

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00:23:50,960 --> 00:23:55,879
Speaker 2: I mean, girl is actually pretty chisel climbs Mount radio

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Speaker 2: every summer. But Lisa, you are the one. What's the

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Speaker 2: number one etiquette that drives your nuts?

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Speaker 6: He said, Well, I work out from home, but when

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00:24:08,840 --> 00:24:10,480
Speaker 6: I do go to the gym, it's the wiping down

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00:24:10,520 --> 00:24:12,480
Speaker 6: the equipment you have to do and also putting back

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00:24:12,520 --> 00:24:13,960
Speaker 6: the weights. People just leave them.

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Speaker 2: Yeah, seriously, it's always it's always some guy who's lifting.

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00:24:22,880 --> 00:24:25,000
Speaker 2: I'm sitting there going I can I can move this.

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Speaker 6: Next Yesterday we were talking about dry January. So now

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00:24:30,960 --> 00:24:35,040
Speaker 6: we have this story doing this America's bourbon boom. It

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00:24:35,080 --> 00:24:37,560
Speaker 6: was big during the pandemic, right, so it seems to

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00:24:37,560 --> 00:24:40,480
Speaker 6: be coming to an end. A lot of insiders telling

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00:24:40,480 --> 00:24:43,160
Speaker 6: the journal that distillers are cutting back jobs, they're stopping

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00:24:43,240 --> 00:24:47,679
Speaker 6: expansion plans, especially the smaller ones, because drinkers are cutting back, right,

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00:24:47,720 --> 00:24:50,399
Speaker 6: They're heading to cheaper brands. They also have people drinking

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00:24:50,480 --> 00:24:53,240
Speaker 6: less because of weight loss drugs. The popularity of that.

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00:24:54,119 --> 00:24:56,679
Speaker 6: They're thinking tariffs could hurt exports on top of it,

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00:24:56,720 --> 00:24:58,639
Speaker 6: and then you had that US Surgeon General warning you

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00:24:58,680 --> 00:25:03,480
Speaker 6: remember that saying alcohol should carry cancer wanting labels. So

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00:25:03,680 --> 00:25:07,040
Speaker 6: it's it's a big thing. But now they're saying they're

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00:25:07,119 --> 00:25:08,800
Speaker 6: starting to cut back. But I don't know. I need

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00:25:08,800 --> 00:25:11,560
Speaker 6: my Manhattan. I have to have it.

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Speaker 4: You're not a bourbon drinker.

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00:25:13,280 --> 00:25:15,639
Speaker 2: I know that to be a fact. On occasion, my

478
00:25:15,720 --> 00:25:20,359
Speaker 2: father actually cuffed Jack Daniels, Jack Daniels bourbon.

479
00:25:21,280 --> 00:25:23,960
Speaker 4: Well, excuse Tennessee whiskey. It's Tennessee whiskey.

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00:25:24,000 --> 00:25:26,080
Speaker 6: It's in the category.

481
00:25:26,080 --> 00:25:28,280
Speaker 2: Specialty man the mateo Manhattan.

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00:25:28,480 --> 00:25:34,760
Speaker 6: What is the I like, Yeah, bourbon rye bullet, that's

483
00:25:34,800 --> 00:25:41,400
Speaker 6: that's next. I don't know if that's a good thing.

484
00:25:42,119 --> 00:25:45,080
Speaker 6: So we move on from this. So Americans drinking less alcohol.

485
00:25:45,080 --> 00:25:48,520
Speaker 6: But what's becoming more on top and what's becoming center

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00:25:48,520 --> 00:25:52,920
Speaker 6: stage is cannabis. Another especially among the younger generation, they're

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00:25:52,960 --> 00:25:55,680
Speaker 6: drinking less alcohol because they're turning to it. But here's

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00:25:55,680 --> 00:25:57,600
Speaker 6: the thing, it's not just and this is in you know,

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00:25:57,680 --> 00:26:00,480
Speaker 6: Business Insider and also on Bloomberg there's a great BusinessWeek

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00:26:00,560 --> 00:26:03,199
Speaker 6: article about it. Is that it's not just people smoking it,

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00:26:03,240 --> 00:26:07,600
Speaker 6: but drinking it. So cannabis infused drinks. A lot of

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00:26:07,680 --> 00:26:10,640
Speaker 6: alcohol companies are going to it. And there's this loophole

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00:26:10,720 --> 00:26:14,120
Speaker 6: because even though legalization varies state by state, a lot

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00:26:14,160 --> 00:26:16,080
Speaker 6: of cannabis products so you can get them in stores

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00:26:16,080 --> 00:26:20,080
Speaker 6: and restaurants nationwide. So the loophole is that it's in

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00:26:20,119 --> 00:26:23,040
Speaker 6: the Agriculture Improvement Act of twenty eighteen. It legalized the

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00:26:23,040 --> 00:26:25,680
Speaker 6: growth and sale of him that contains those low concentrations

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00:26:25,680 --> 00:26:27,399
Speaker 6: of cannabis. So now it's kind of this free for

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00:26:27,440 --> 00:26:29,480
Speaker 6: all and people are trying to figure out where is

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00:26:29,520 --> 00:26:33,200
Speaker 6: it legal, where is it not legal? But it's being

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00:26:33,240 --> 00:26:36,600
Speaker 6: sold yes, stores and restaurants worldwide, and this is the

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00:26:36,600 --> 00:26:38,240
Speaker 6: new thing and the cannabis infused.

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Speaker 2: And I noticed quickly here boy, the sheds are gone

504
00:26:42,240 --> 00:26:42,879
Speaker 2: in the street.

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Speaker 4: Oh yeah, thereants, yes here in New York.

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Speaker 7: You know.

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00:26:47,480 --> 00:26:49,280
Speaker 4: I was talking to a restaurant owner who said they

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00:26:49,280 --> 00:26:51,800
Speaker 4: have to build a certain type that the city approves,

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00:26:51,800 --> 00:26:54,000
Speaker 4: and it's it's expensive and it's but it was kind

510
00:26:54,000 --> 00:26:56,399
Speaker 4: of a sad moment in a way to see those.

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00:26:56,280 --> 00:27:00,159
Speaker 2: Disappearable Lisa, tell you, thank you so much. This uh

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00:27:00,600 --> 00:27:03,440
Speaker 2: newspapers A Lisa Bruteo. It's watch to you by bullet

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00:27:03,560 --> 00:27:05,200
Speaker 2: rye famous Rye.

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Speaker 4: You want to give your address.

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Speaker 1: Right This is the Bloomberg Surveillance Podcast, available on Apple, Spotify,

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00:27:13,960 --> 00:27:18,280
Speaker 1: and anywhere else you get your podcasts. Listen live each weekday,

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00:27:18,400 --> 00:27:21,840
Speaker 1: seven to ten am Eastern on Bloomberg dot com, the

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00:27:21,920 --> 00:27:25,960
Speaker 1: iHeartRadio app, tune In, and the Bloomberg Business app. You

519
00:27:26,000 --> 00:27:29,359
Speaker 1: can also watch us live every weekday on YouTube and

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00:27:29,560 --> 00:27:31,320
Speaker 1: always on the Bloomberg terminal