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Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am

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Speaker 1: Bloomberg eleven thirty.

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Speaker 2: Let's get back to the CPI number.

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Speaker 3: So the takeaway in general seems to be that disinflation

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Speaker 3: is not what we've seen, say, in the last three months,

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Speaker 3: that what we're used to, But that doesn't necessarily mean

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Speaker 3: that the economy is reaccelerating. So we kind of want

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Speaker 3: to understand the nuance here. Here's Lindsay Pigs, chief economist

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Speaker 3: over at Stifel. She joins us from Minneapolis. Lindsay, how

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Speaker 3: would you categorize the CPI data this morning and does

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Speaker 3: it change the trajectory at all for the FED? Well?

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Speaker 4: I would categorize it as a somewhat disappointing report for

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Speaker 4: the Fed's that's still struggling desperately to reinstate price stability. Now,

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Speaker 4: it's important not to look at one data point. That's

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Speaker 4: never enough to sway the FED in one direction. Or

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Speaker 4: the other. But we do have to put this in

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Speaker 4: the context of ongoing, an ongoing lack of even downward

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Speaker 4: momentum in prices at best. Inflation has been uneven moving

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Speaker 4: sideways for the past couple of months, and so this

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Speaker 4: really underscores the need for the FED to remain focused

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Speaker 4: on reaching that two percent target. Now, last month they

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Speaker 4: were buoyed by this mounting concern for the labor market.

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Speaker 4: But as we saw in the latest September labor market data,

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Speaker 4: the employment reports are still near full employment. The data

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Speaker 4: suggests the labor market is still very solid, and so

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Speaker 4: I do think that at this point the fed's focus

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Speaker 4: may be better directed towards that price stability component of

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Speaker 4: the dual mandate.

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Speaker 5: You know, Lindsa we were talking to Tom Keen and

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Speaker 5: I are earlier today with the professor Cam Harvey at

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Speaker 5: Duke University, and he's a big proponent of the fed's way, way,

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Speaker 5: way behind, because they're using really dated data, particularly housing data,

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Speaker 5: and if you take a look at some of the

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Speaker 5: real rents and stuff like that, inflation's already whipped and

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Speaker 5: this FED should be you know, cutting rates. Maybe how

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Speaker 5: do you feel about that?

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Speaker 4: Well, I think there's a number of different ways to

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Speaker 4: look at inflation, and sure, if we take out some

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Speaker 4: of the stickiest components, you can get a much better

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Speaker 4: read on inflation. But when we're trying to look at

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Speaker 4: the overall price index for consumers, what we're feeling in

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Speaker 4: terms of costs for goods and services out in the marketplace,

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Speaker 4: that underlying core measure, which excludes food and energy because

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Speaker 4: those are extremely volatile. From a policy standpoint, that suggests

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Speaker 4: that inflation is not quote whipped, and that the Fed's

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Speaker 4: job of reinstating price stability has not been complete and

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Speaker 4: remaining on a downward trajectory back to two percent is

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Speaker 4: not a foregone conclusion. So I would caution against that

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Speaker 4: line of thinking. That could leave us in a very

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Speaker 4: difficult position where the FED takes a more aggressive approach

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Speaker 4: to policy in anticipation of further improvement, only to find

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Speaker 4: out we're not there yet and the FED either has

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Speaker 4: to reverse course or simply has driven us into the

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Speaker 4: most unfavorable scenario of stagulation at that point.

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Speaker 3: But but, but, but that brings us to the other

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Speaker 3: data point, which is initial jobless claims.

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Speaker 2: I know that they can be volatile.

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Speaker 3: I know you also have a hurricane Helene as well

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Speaker 3: as the Boeing strike impact, Like there's those reads too,

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Speaker 3: So which path is a FED follow like inflation slowing

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Speaker 3: less than we thought or initial jobless claims rising more

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Speaker 3: than we thought.

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Speaker 4: Well, I think you have to put the jobless claims,

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Speaker 4: as you said, in the context of the events that

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Speaker 4: are occurring in the economy at this point. Between the

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Speaker 4: strikes and the hurricanes, we anticipated a lot of volatility,

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Speaker 4: and you can tell that this is an outsized increase

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Speaker 4: relative to the very calm trend that has been well

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Speaker 4: established for the past couple of years. You also have

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Speaker 4: to put this one weekly data point in the context

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Speaker 4: of again that September employment report, where we see wages,

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Speaker 4: we see job vacancies, we see the participation rate, we

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Speaker 4: see top line hiring, all suggesting tight ish conditions, lingering

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Speaker 4: tightish conditions for the labor market, which does not support

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Speaker 4: this pop in weekly jobless claims, again, which is primarily

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Speaker 4: a reflection of some of these one off incidents in

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Speaker 4: the economy. The FED knows that the FED is not

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Speaker 4: going to adjust policy based on a weekly data point,

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Speaker 4: but again it does underscore this bifurcation among FED officials.

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Speaker 4: As we saw in the Minutes yesterday, there are a

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Speaker 4: number of FED officials that are concerned about the labor

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Speaker 4: market and say that we should continue to cut in

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Speaker 4: anticipation of weakness to support the labor market and the

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Speaker 4: broader economy regardless of what it takes. On the other side,

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Speaker 4: you have Governor Bowman leaving the pack saying no, they're

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Speaker 4: still upside risk to inflation, and that's where we need

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Speaker 4: to keep our focus because without price stability, the economy

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Speaker 4: doesn't work for anybody.

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Speaker 5: How about the consumer, lindsay, some of the data points

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Speaker 5: you've seen over the last couple weeks, what's your read

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Speaker 5: on the yost consumer.

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Speaker 4: Well, I think that consumer is surprisingly resilient at this point.

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Speaker 4: The consumer is still out in the marketplace spending on

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Speaker 4: goods and services, but they're doing so at a noticeably

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Speaker 4: reduced pace. We've gone from double digits to eight to

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Speaker 4: six now down to an average pace of three. Again

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Speaker 4: still positive, but a very clear second derivative decline or

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Speaker 4: slower pace of positive expenditures as consumers are feeling the

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Speaker 4: weight of higher prices, higher borrowing costs, the resumption of

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Speaker 4: student debt payments, and so we see consumers increasingly turning

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Speaker 4: to these less organic measures for support in order to

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Speaker 4: keep spending in the marketplace. We see four oh one

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Speaker 4: k hardship withdrawals of double digits. We see consumers turning

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Speaker 4: to an intergenerational wealth transfer, and of course, surprise, surprise,

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Speaker 4: credit cards are up there on the list.

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Speaker 3: Yeah, absolutely, all right, lindsay, thanks a lot, really appreciate it.

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Speaker 3: I still feel like it's all a ork check test

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Speaker 3: at the end of the day, pigs. As she joins

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Speaker 3: us from Stefelt.

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

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Speaker 3: Let's say on the Hurricane Milton track. Of course, there

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Speaker 3: were reports of tornadoes also pumbling through the state as well.

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Speaker 2: Let's take an impact. Let's take a look on the

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Speaker 2: impact on the housing market.

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Speaker 3: Ken Johnson is Walker Family Chair of real Estate at

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Speaker 3: the University of Mississippi. Ken, it's great to get your

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Speaker 3: perspective on this. How do we know what the full

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Speaker 3: damage is to say, the housing market. How long does

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Speaker 3: that assessment take?

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Speaker 6: So we can make some upfront esturbations, but we probably

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Speaker 6: won't know the full results quite honestly, for a couple

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Speaker 6: of years. Using Ian as a test case, we're still

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Speaker 6: recovering South Florida. That is, is still covering southwest Florida.

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Speaker 6: From Ian, this appears to be less in scope, so

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Speaker 6: we're probably still looking at several months before we've completely

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Speaker 6: gotten rid of Hurricane Milton.

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Speaker 5: Talk to us about just I don't know you think

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Speaker 5: about owning real estate Florida. But that is not for

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Speaker 5: the faint of heart here because talk to us at

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Speaker 5: just about I don't insurance and how this folks that

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Speaker 5: are just.

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Speaker 7: Keep rebuilding and rebuilding. Is there are there lessons learned

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Speaker 7: down there?

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Speaker 6: Well, many, many folks predict that these hurricanes are going

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Speaker 6: to end the growth in Florida, and they've been on

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Speaker 6: record for one hundred and fifty plus years. Going back

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Speaker 6: over one hundred years, I think there's over thirty category

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Speaker 6: threes or higher that have struck the state. Dire predictions

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Speaker 6: have been made in the past and they never come about.

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Speaker 6: And it's because the demand to live in Florida just

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Speaker 6: keeps increasing. Nice, solid economy, good weather, Son's hurricanes, warm

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Speaker 6: in the winter, air conditioning works in the summer, strong

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Speaker 6: business climate. People are coming to Florida and this is

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Speaker 6: not going to stop.

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Speaker 3: What about the prices of those particular houses though, because

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Speaker 3: what we can't argue is that insurance companies are dump

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Speaker 3: in Florida right there's any local insurance companies. There are

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Speaker 3: many stories of people's insurance premium is just rising really fast,

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Speaker 3: which means it's hard then to sell the house. At

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Speaker 3: the same time, maybe it's more expensive than to buy

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Speaker 3: a house.

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Speaker 2: Does this need to settle out?

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Speaker 6: It does, and this has been an issue in Florida

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Speaker 6: for quite some time now. It's slowly getting better. Some

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Speaker 6: legislation was brought about in terms of limiting liability exposure

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Speaker 6: off of certain types of damages and that you had

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Speaker 6: to be timely and filing your claims slowly slowly taking effect.

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Speaker 6: But home insurance is going to be an issue in

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Speaker 6: Florida for years to come. The state does have an

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Speaker 6: insurer of last resort and that's the Citizens Group. If

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Speaker 6: you there in Florida, you're very familiar with Citizens, So yes,

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Speaker 6: it's a problem. It's something that'll work through. The reinsurance

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Speaker 6: rates have gone down this year for Florida. That was

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Speaker 6: really good news. Probably will not be again. So in

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Speaker 6: other words, the people ensuring the insurance companies their rates

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Speaker 6: had went down an end of twenty three, they'll probably

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Speaker 6: be back up end of this year now due to

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Speaker 6: the two storms combined.

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Speaker 7: All right, let's zoom out a little bit from Florida

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Speaker 7: and just talk about affordability.

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Speaker 5: Housing affordability or lack there of in this country. Can

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Speaker 5: you just give us a sense of how do we

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Speaker 5: got to this place where we are now where it

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Speaker 5: really seems to be a real stretch for so many Americans.

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Speaker 7: Housing affordability.

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Speaker 6: Sure, So, if I had to pick one item that

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Speaker 6: was the most influential in this or the approximate cause

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Speaker 6: of unaffordable housing at this point in time was post

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Speaker 6: the last housing crash circa two thousand and seven and eight,

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Speaker 6: depending on where you were in the country. The markets

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Speaker 6: turned out. Real estate markets all over the country turned down.

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Speaker 6: They bottomed about twelve but during that period in time,

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Speaker 6: we lost thousands of small builders. Today we mostly have large,

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Speaker 6: publicly owned developers. It's hard to keep pace. We've just

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Speaker 6: lost so many builders. You know, the difference between a

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Speaker 6: builder and developer quite often is maybe the scale. So

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Speaker 6: we have fewer but much much larger developers, But we

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Speaker 6: still need those mom and pop builders that build those

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Speaker 6: fifty plus or minus homes a year, and they just

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Speaker 6: they left the market, or they were forced out, or

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Speaker 6: they were forced into bankruptcy, and they have not come

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Speaker 6: back into the marketplace. That might so we're not building enough.

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Speaker 3: Years explanation I've heard for what we don't have enough

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Speaker 3: supply that nuance. Does that mean then that this is

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Speaker 3: a cyclical industry still, as you say, like, okay, so

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Speaker 3: then you got to then we're going to overbuild at

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Speaker 3: some point and then prices come down or is this

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Speaker 3: truly structural?

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Speaker 6: I think it's still more cyclical. But this is this

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Speaker 6: is an ongoing issue. So if we go through a

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Speaker 6: few cycles and we haven't solved it, then yes, we

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Speaker 6: have a chronic, persistent problem. I would love to see

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Speaker 6: a little bit easier for the small builder to develop

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Speaker 6: and thrive and restart. Getting that done is another set

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Speaker 6: of circumstances to work through.

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Speaker 5: You know, one of the issues for a lot of

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Speaker 5: folks is nobody wants to leave their home because so

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Speaker 5: many people are sitting on you know, three four percent

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Speaker 5: mortgages some people below.

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Speaker 2: You set me up, man, you do it on purpose.

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Speaker 3: At this point, I have two point seventy five, which

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Speaker 3: I talk about all the time all the time.

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Speaker 8: So where do you think mortgage rates need to go?

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Speaker 5: Professor for you know, the Alex Steels of the world, saying,

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Speaker 5: all right, I can consider selling my existing home and

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Speaker 5: going somewhere else.

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Speaker 7: That would free up some inventory.

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Speaker 6: So our overall mortgage rates in the country, they're higher.

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Speaker 6: Oddly they're higher since the Fed's announcement to lower the

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Speaker 6: interbank loan rate, but that that'll correct itself in the

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Speaker 6: next few weeks or so. But it's not necessarily what

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Speaker 6: rate will have to come about such that folks will

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Speaker 6: start to begin to sell those two point seventy five

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Speaker 6: three percent loans. What will happen, probably more likely for

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Speaker 6: those folks is they'll have a change in life event

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Speaker 6: I'm moving to another city. Unfortunately, financial distress will cause

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Speaker 6: a lot of sale. So a lot of these things

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Speaker 6: are going to be brought back. A lot of these

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Speaker 6: properties are going to be brought back into the marketplace

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Speaker 6: because I have to sell rather than I want to sell.

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Speaker 6: But we're probably going to see an environment we'll get

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Speaker 6: back to the four and a half spives. We're never

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Speaker 6: I don't think in my professional lifetime will we ever

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Speaker 6: see two point seventy five or three percent again. That

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Speaker 6: was just so unusual and we can't have that as

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Speaker 6: the norm. And oh we're not back to the norm.

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Speaker 6: Well that wasn't the norm.

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Speaker 3: Yeah, I was doing a little happy dance for those

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Speaker 3: of you who were unfortunately smug.

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Speaker 7: Yes I am. I mean the air of smugness.

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Speaker 3: It's the one thing I can literally, the one thing

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Speaker 3: I can brag about, and so I do walk about.

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Speaker 3: It's still being a cyclical industry. How long do you

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Speaker 3: think that cycle then could be? Like when do we

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Speaker 3: get to like an oversupply situation?

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Speaker 2: Ten years? What does it look like?

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Speaker 6: So hard to say. Again, the cycle, this last cycle

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Speaker 6: has been extended for several reasons, one of which is COVID,

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Speaker 6: And we were talking about the low interest rates. We

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Speaker 6: were pretty near a peak back in twenty ish, and

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Speaker 6: then we had COVID and we've all had much easier

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Speaker 6: access to capital, shortage of housing, we bid prices up.

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Speaker 6: This is going to be quite some time. We're years

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Speaker 6: in the catchup, so minimum another three to four years

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Speaker 6: to catch up, maximum a decade.

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Speaker 5: All right, you just made the big move from Boca Raton, Florida,

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Speaker 5: Florida Lanta University to Oxford, Mississippi thirty seconds.

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Speaker 7: What's the big difference.

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Speaker 6: Well, I have the best of both worlds now. Originally

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Speaker 6: I'm from the South and I've always loved are that

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Speaker 6: dreamt of being at a state university, flagship school SEC

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Speaker 6: football and sports. I love Boca. So we've kept a

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Speaker 6: place there in Boca, my wife and I have and

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Speaker 6: we will continue to be there in the summers and

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Speaker 6: at Christmas time. You know, to be anything above it

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Speaker 6: ten is like a reflecting barrier in terms of winter cold.

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Speaker 6: But if you come to Oxford, you would understand why

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Speaker 6: I wouldn't pass on this opportunity to come here and

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Speaker 6: build a program.

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Speaker 7: Yeah, it's fantastic.

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Speaker 5: Old Miss Ken Johnson Walker Family Chair of real Estate

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Speaker 5: at the University of Mississippi that is in Oxford, Mississippi.

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Speaker 5: I just kind of googled map the because I always forget.

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Speaker 7: Where Oxford is. Northwestern part of the state. Just it's

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Speaker 7: very close to Memphis. Tennessee. Actually, oh, it's closely the

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Speaker 7: Arkansas border, but it is. You know, that's deep sec.

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Speaker 5: Country, Old miss but pretty cool there. But again, a

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Speaker 5: big move from Bocah to Oxford.

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Speaker 3: I thought you were looking at an uber and I'm like,

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Speaker 3: you're not goingwhere. For like two hours, I don't know

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Speaker 3: what this guy's doing.

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Speaker 7: But now now I understand you where it's all about.

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

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Speaker 1: weekdays at ten am Eastern on fo car playing Android

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Speaker 1: Otto with the Bloomberg Business App. Listen on demand wherever

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Speaker 1: you get your podcasts, or watch us live on YouTube.

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Speaker 5: Let's check in with somebody who's paying attention to earnings

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Speaker 5: because they're going to kick off in size tomorrow with

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Speaker 5: JP Morgan. We always pay attention to what Jamie Dimond

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Speaker 5: says about the overall economy. Karen Murphy Joints is. She's

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Speaker 5: a CIO at Kestra Investment Management. So Carol, we're gonna

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Speaker 5: have earnings tomorrow. But I love to just get your

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Speaker 5: thoughts here on that CPI print today and maybe how

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Speaker 5: you think that may impact FED actions going forward.

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Speaker 9: Yeah, so I given the print today, I don't think

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Speaker 9: there are too many doves who are celebrating. You know,

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Speaker 9: this is definitely a little bit of a fly in

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Speaker 9: the ointment of the deceleration and inflation that we've seen

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Speaker 9: over the last couple of months.

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Speaker 10: That's it.

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Speaker 9: I mean, it looks like markets are taking it in stride. So,

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Speaker 9: you know, inflation showed up a little bit hotter than

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Speaker 9: what I think many of us would have liked to

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Speaker 9: have seen, and I think it's a really good reminder

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Speaker 9: that the FED has a tough job. You know, we

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Speaker 9: saw also claims happened to come in today a little

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Speaker 9: bit higher than expected. So what we're seeing now is

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Speaker 9: inflation a little bit hotter than expected, labor market a

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Speaker 9: little bit weaker than expected. So it's a really difficult trajectory.

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Speaker 9: So I think the FED is still on track to

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Speaker 9: do a twenty five bit cut at its next meeting.

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Speaker 9: Today's print won't be enough to really change the Fed's mind,

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Speaker 9: but you know, it does highlight that there's a lot

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Speaker 9: of complexity and a couple more sort of hotter inflation

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Speaker 9: prints between now and the end of the year. It

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Speaker 9: could start to slow those FED rate cuts.

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Speaker 3: Yeah, exactly, we've seen FED cuts kind of priced down

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Speaker 3: a little bit up for twenty twenty five. So if

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Speaker 3: we are okay, it's a two firm, does that mean

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Speaker 3: that the US economy could reaccelerate? And then if we

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Speaker 3: are seeing a longer economic cycle, does it change where

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Speaker 3: in the market have to be invested with in equities.

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Speaker 9: I think that's the question that we should be asking ourselves,

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Speaker 9: and I think the easy answer is that, like, we

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Speaker 9: know that the economy and the market typically doesn't go

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Speaker 9: in a straight line, So the FED is actively trying

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Speaker 9: to pivot. Right. We had our first rate cut in

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Speaker 9: quite a while, and that introduces a lot of cross

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Speaker 9: currents into the market, and so it makes sense that

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Speaker 9: the economy is going to kind of, you know, chunk

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Speaker 9: around for a little bit. So yes, we could see

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Speaker 9: a reacceleration. I think the Fed will then you start

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Speaker 9: to pull back a little bit. But this like lag

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Speaker 9: issue in monetary policy is a really big challenge because

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Speaker 9: the labor market starting to weaken a little bit is

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Speaker 9: responding to rate cuts that happened quite some time ago.

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Speaker 9: So even sorry rate hikes that happened quite some time ago.

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Speaker 9: So even if the Fed starts to cut, it will

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Speaker 9: be a while before we see it in the market,

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Speaker 9: So it makes sense that the market will or the

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Speaker 9: economy will sort of like reaccelerate and then slow down again,

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Speaker 9: and it'll take a little while before we get to

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Speaker 9: like that firm footing and determine where the FED should

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Speaker 9: have its resting place be. So then what does the

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Speaker 9: market do in the meantime? I think smaller companies who

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Speaker 9: rely more heavily on debt are a little bit more

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Speaker 9: subject to the fed's whims, so as FED rates come down,

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Speaker 9: they'll benefit more. If those rates take longer, it might

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Speaker 9: take longer for them to see that real earnings reacceleration

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Speaker 9: that we're waiting for. But there are multiple different pieces

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Speaker 9: that kind of feed into that.

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Speaker 5: So given all that background, how are you guys positioned? First,

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Speaker 5: let's go with the equity side of the equation.

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Speaker 7: How are you positioned there?

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Speaker 9: So we still are really favorable on equities, But what

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Speaker 9: we found is that your core benchmarks have moved very

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Speaker 9: heavy into large cap or megacap and into growth. So

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Speaker 9: what we're doing is kind of taking a step closer

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Speaker 9: towards a little bit more even split between value and

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Speaker 9: growth and favoring some of those somewhat smaller companies, and

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Speaker 9: like I often say, you don't have to go all

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Speaker 9: the way down to small cap in order to benefit

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Speaker 9: from being out of that megacap You just you can

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Speaker 9: just go into the smaller large cap or we think

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Speaker 9: megacap MidCap is really attractive as well. So just starting

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Speaker 9: to step a little bit towards the center of that

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Speaker 9: while still remaining overweight equities.

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Speaker 3: Yeah, I feel like I've been talking about mid caps

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Speaker 3: for a bit, and every kind of day you got

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Speaker 3: the SMP making a record high, the midcaps also make

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Speaker 3: a run for it at the same time. Okay, how

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Speaker 3: does that then position you in the bond market? Like,

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Speaker 3: do we still get a steepener? It's just a matter

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Speaker 3: of how we get that steepener that matters.

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Speaker 9: Yes, it does. And I think the easier sort of

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Speaker 9: bet to make on the fixed income side is to

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Speaker 9: be out of high yield credit, not completely out, but

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Speaker 9: underweight high yield credit where we think if the FED

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Speaker 9: rate cutting cycle takes longer than we'd like to, those

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Speaker 9: are the companies that are going to face some pressure.

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Speaker 9: And you see really low spreads there right, so you're

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Speaker 9: not being paid a lot in order to take that risk.

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Speaker 9: High quality corporate on the other hand, we think is

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Speaker 9: pretty attractive. There you get a nice interest rate bomb,

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Speaker 9: you're not taking a huge amount of duration risk, but

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Speaker 9: still benefiting from that higher overall yield compared to treasuries.

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Speaker 9: So in treasuries there you know, would be more in

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Speaker 9: the belly of the curve outside those really long duration

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Speaker 9: which we've seen be fairly volatile as inflation sort of

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Speaker 9: comes and goes. But you want to start to step

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Speaker 9: off of those really short term rates.

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Speaker 5: And if I look at then GO function on the

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Speaker 5: Bloomberg terminal, which gives me a nice overview kind of

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Speaker 5: fixed income market year today performance, the best for fixed

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Speaker 5: income has been and by far has been US high

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Speaker 5: yield corporates.

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Speaker 7: Talks about the higher money now, love to get your

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Speaker 7: thoughts there. What do you think about the high old market.

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Speaker 9: Yeah, so it's been super interesting to see how it's

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Speaker 9: really led. And typically what we see is high yield

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Speaker 9: is very highly correlated with equity markets. So in some ways,

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Speaker 9: you know, that's a lot of what we've been seeing

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Speaker 9: where it's very consistent that investors are looking for a

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Speaker 9: little bit more risk, and so if they're dipping their

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Speaker 9: toe into the fixed income market, high yield becomes an

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Speaker 9: easy place to go. I also think as folks were

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Speaker 9: worried about kind of the trajectory of the FED rate cut,

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Speaker 9: that was also a safer place to be. You're a

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Speaker 9: little bit more inoculated from those rate changes because you

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Speaker 9: have that spread. But again, that's looking in the rear

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Speaker 9: view mirror. So we've seen that real strength in the

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Speaker 9: past and going forward, I don't know that you're being

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Speaker 9: paid to take a lot.

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Speaker 7: Of that risk.

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Speaker 3: Yeah, right, exactly. So then if you want to go

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Speaker 3: in corporate credit, where's the right place, Like you're looking

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Speaker 3: at double Bee's, Triple B's kind of thing.

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Speaker 9: Yeah, I think right in that place, And you can

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Speaker 9: also go higher credit quality as well. Again, those spreads

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Speaker 9: are fairly tight, but if you're in the belly part

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Speaker 9: of the curve, you're a little bit protected from any

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Speaker 9: of that volatility on the long end, and you can

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Speaker 9: have some really nice, juicy yields. If you look at

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Speaker 9: yields today in that space compared to the last ten years,

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Speaker 9: you have among the best yields that we've seen during

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Speaker 9: some investors' lifetimes. So that's you know, that's a pretty

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Speaker 9: attractive place to be.

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Speaker 5: And Cara, I think the month of September was either

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Speaker 5: the biggest issuance month, but are one of the biggest

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Speaker 5: issuance months of investment grade corporates. When you, as an

439
00:22:02,280 --> 00:22:05,840
Speaker 5: investor see companies rushing to the market, what does that

440
00:22:05,880 --> 00:22:06,680
Speaker 5: tell you about the market?

441
00:22:06,920 --> 00:22:07,800
Speaker 7: Take anything away from that.

442
00:22:09,080 --> 00:22:11,679
Speaker 9: Well, I think a lot of firms had really held

443
00:22:11,680 --> 00:22:14,359
Speaker 9: off issuing debt because of uncertainty in the market. It's

444
00:22:14,359 --> 00:22:17,000
Speaker 9: an uncertainty of where rates we're going to go. So

445
00:22:17,080 --> 00:22:19,200
Speaker 9: I think this is a sign of confidence that people

446
00:22:19,240 --> 00:22:21,120
Speaker 9: are willing to come back to the market. I would

447
00:22:21,160 --> 00:22:23,560
Speaker 9: expect to continue to see issuance kind of tick up

448
00:22:23,600 --> 00:22:26,159
Speaker 9: over the next couple of months, especially as if we

449
00:22:26,200 --> 00:22:28,439
Speaker 9: see additional rate cuts. So I think it's a healthy

450
00:22:28,440 --> 00:22:29,640
Speaker 9: sign for the market overall.

451
00:22:30,200 --> 00:22:32,480
Speaker 3: All right, Kara, really appreciate it. Thank you so very

452
00:22:32,560 --> 00:22:36,720
Speaker 3: much for joining us Care. Murphy CEO Orchestra Investment Management.

453
00:22:36,760 --> 00:22:39,240
Speaker 3: It all depends too, Paul, like, what do you think

454
00:22:39,280 --> 00:22:41,439
Speaker 3: the catalyst is going to be? Deutsche Bank had a

455
00:22:41,440 --> 00:22:43,400
Speaker 3: really interesting note oubt and I appreciate it is from

456
00:22:43,440 --> 00:22:45,960
Speaker 3: the equity side, but saying that cyclical growth is now

457
00:22:46,040 --> 00:22:48,920
Speaker 3: the key driver for equity is not infletion not rates,

458
00:22:48,960 --> 00:22:51,320
Speaker 3: which makes an earning season kind of all the much

459
00:22:51,320 --> 00:22:51,840
Speaker 3: more important.

460
00:22:51,880 --> 00:22:53,360
Speaker 2: Sure, maybe you're all talking your book.

461
00:22:53,119 --> 00:22:55,000
Speaker 3: Of what you like to cover, but still, but the

462
00:22:55,040 --> 00:22:56,480
Speaker 3: idea is like, look, the Fed is going to do

463
00:22:56,520 --> 00:22:59,439
Speaker 3: the thing. Other things are going to matter, especially if

464
00:22:59,440 --> 00:23:01,480
Speaker 3: we get any sort of capex spend after the US

465
00:23:01,560 --> 00:23:04,440
Speaker 3: election or even after earnings, for example.

466
00:23:04,160 --> 00:23:06,480
Speaker 2: And some of that's going to be structural rather than cyclical.

467
00:23:06,640 --> 00:23:09,000
Speaker 5: Yeah, in interesting to see, and I guess you know, uh,

468
00:23:09,240 --> 00:23:11,800
Speaker 5: Jamie Diamond tomorrow. I think a lot of folks kind

469
00:23:11,800 --> 00:23:13,879
Speaker 5: of really dial into that call hoping to get a

470
00:23:13,960 --> 00:23:16,159
Speaker 5: view of kind of how the global economy is looking

471
00:23:16,720 --> 00:23:19,200
Speaker 5: across all of their businesses. But again, maybe it could

472
00:23:19,240 --> 00:23:21,760
Speaker 5: be a time for cyclicals. A lot of folks, as

473
00:23:21,880 --> 00:23:24,600
Speaker 5: Caro was suggesting, maybe thinking about broadening out this mark

474
00:23:24,600 --> 00:23:26,280
Speaker 5: a little bit at mid captain small cap.

475
00:23:26,359 --> 00:23:27,840
Speaker 7: So yep, keep keep that in mind.

476
00:23:29,440 --> 00:23:33,320
Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

477
00:23:33,400 --> 00:23:36,920
Speaker 1: weekdays at ten am Eastern on applecar Play and Android

478
00:23:36,960 --> 00:23:39,720
Speaker 1: Otto with the Bloomberg Business app. You can also listen

479
00:23:39,840 --> 00:23:42,920
Speaker 1: live on Amazon Alexa from our flagship New York station,

480
00:23:43,320 --> 00:23:46,080
Speaker 1: just Say Alexa Play Bloomberg eleven thirty.

481
00:23:47,920 --> 00:23:49,199
Speaker 3: I we want to get the take now on what

482
00:23:49,320 --> 00:23:53,000
Speaker 3: Hurricane Milton means for the reinsurance and the insurance companies.

483
00:23:53,040 --> 00:23:57,000
Speaker 3: Matthew Palizoa, Bloomberg Intelligence Andior ANALYSTP and C Insurance joins US. Now,

484
00:23:57,320 --> 00:23:59,359
Speaker 3: so how have you changed your modeling in terms of

485
00:23:59,359 --> 00:24:02,200
Speaker 3: the impact for the insurers based on what we've seen.

486
00:24:02,760 --> 00:24:05,840
Speaker 11: So it looks like they avoided the worst case scenario

487
00:24:06,280 --> 00:24:08,640
Speaker 11: we were talking about going into the storm. The inturyers

488
00:24:08,720 --> 00:24:13,200
Speaker 11: talking about about one hundred billion dollars worth of insured losses,

489
00:24:13,240 --> 00:24:16,120
Speaker 11: which would have made it the worst storm ever. That

490
00:24:16,280 --> 00:24:20,000
Speaker 11: was predicated on a direct hit into Tampa Bay, which

491
00:24:20,000 --> 00:24:23,960
Speaker 11: really didn't happen. So that was the good news. The

492
00:24:24,000 --> 00:24:26,160
Speaker 11: bad news is still going to be a large insured

493
00:24:26,200 --> 00:24:29,280
Speaker 11: loss event. Now. The other good news for the large

494
00:24:29,359 --> 00:24:31,320
Speaker 11: national carriers when we kind of talked about this before,

495
00:24:31,480 --> 00:24:34,440
Speaker 11: is they're just not big players in that market. So

496
00:24:34,600 --> 00:24:39,560
Speaker 11: companies like Travelers, Chubb, AIG, Hartford, they're not major players

497
00:24:39,600 --> 00:24:42,399
Speaker 11: in the Florida home market. They will have losses from this,

498
00:24:42,920 --> 00:24:47,399
Speaker 11: but much less than we initially anticipated. I come to

499
00:24:47,480 --> 00:24:50,040
Speaker 11: like a midpoint of maybe five to six percent of

500
00:24:50,200 --> 00:24:52,639
Speaker 11: annual EPs taken out from the storm.

501
00:24:53,040 --> 00:24:56,159
Speaker 5: What do we think that insured losses actually will end

502
00:24:56,240 --> 00:24:57,480
Speaker 5: up being, if not one hundred billion.

503
00:24:57,600 --> 00:25:01,160
Speaker 11: So it's super early, Paul, But I mean, just back

504
00:25:01,160 --> 00:25:03,200
Speaker 11: at the envelope, we're kind of looking at maybe ten

505
00:25:03,359 --> 00:25:05,879
Speaker 11: to fifty or something like that. Like it could be

506
00:25:05,920 --> 00:25:09,920
Speaker 11: on top Hurricane Ian twenty twenty two was sixty five.

507
00:25:11,880 --> 00:25:15,040
Speaker 11: The early reports I'm hearing is the surge in Tampa

508
00:25:15,080 --> 00:25:18,480
Speaker 11: was actually less than even Colleen, So it was less

509
00:25:18,480 --> 00:25:22,359
Speaker 11: than Ian as well, So it could be lower than

510
00:25:22,480 --> 00:25:24,399
Speaker 11: sixty five. But it's still early, and you've got the

511
00:25:24,400 --> 00:25:26,159
Speaker 11: holding damage on top of it.

512
00:25:26,200 --> 00:25:28,720
Speaker 3: Is this, So how does it work done with premiums?

513
00:25:29,040 --> 00:25:31,119
Speaker 3: I mean we're used to hurricanes, right, so like do

514
00:25:31,200 --> 00:25:34,359
Speaker 3: premiums for insurers or reinsures wind up going up?

515
00:25:34,400 --> 00:25:34,480
Speaker 9: Like?

516
00:25:34,520 --> 00:25:36,280
Speaker 2: How does that work? And what's the immediate reaction?

517
00:25:36,440 --> 00:25:39,560
Speaker 11: So you got a bunch of dynamics in this whole

518
00:25:39,640 --> 00:25:41,119
Speaker 11: insurance premiums going up.

519
00:25:41,080 --> 00:25:43,800
Speaker 2: Anyway, right for everyone?

520
00:25:43,960 --> 00:25:47,240
Speaker 11: Pretty much for everyone. That's been happening for a while now,

521
00:25:47,280 --> 00:25:52,080
Speaker 11: And that is cost of materials, the frequency and severity

522
00:25:52,119 --> 00:25:58,640
Speaker 11: of storms nationwide anyway, severe convective storms, kind of strong hail,

523
00:25:58,760 --> 00:26:01,159
Speaker 11: stuff like that. So it's not just hurricanes, So that

524
00:26:01,440 --> 00:26:05,119
Speaker 11: has been driving home insurance prices up anyway. Reinsurance prices

525
00:26:05,359 --> 00:26:08,320
Speaker 11: insurance for insurance companies have been going up anyway, which

526
00:26:08,400 --> 00:26:11,240
Speaker 11: drives it up as well. What I think will happen,

527
00:26:11,320 --> 00:26:13,120
Speaker 11: and not exactly want to make this call, but there's

528
00:26:13,119 --> 00:26:15,359
Speaker 11: gonna be demand surge, meaning there's gonna be a huge

529
00:26:15,359 --> 00:26:18,200
Speaker 11: demand for building materials and that is going to push

530
00:26:18,320 --> 00:26:22,640
Speaker 11: up costs across the country as well, so that'll feed

531
00:26:22,680 --> 00:26:26,040
Speaker 11: into price. So there's a bunch of upward things pushing

532
00:26:26,040 --> 00:26:27,280
Speaker 11: on home insurance prices.

533
00:26:27,560 --> 00:26:30,080
Speaker 5: I don't know, it just feels like we've had a

534
00:26:30,119 --> 00:26:32,800
Speaker 5: lot of storms, and I know this this season was actually.

535
00:26:32,560 --> 00:26:34,240
Speaker 7: Pretty common until just recently.

536
00:26:34,720 --> 00:26:36,120
Speaker 5: Then I go look at the S and P five

537
00:26:36,160 --> 00:26:39,639
Speaker 5: hundred Property and casually insurance sub industry index, and there

538
00:26:39,720 --> 00:26:41,679
Speaker 5: is such a thing on the Bloomberg terminal. It's up

539
00:26:41,720 --> 00:26:44,159
Speaker 5: thirty eight percent year to date. These insurance stocks are

540
00:26:44,160 --> 00:26:45,280
Speaker 5: doing well.

541
00:26:45,320 --> 00:26:46,600
Speaker 7: What's going on there? So what's the call?

542
00:26:46,720 --> 00:26:50,760
Speaker 11: Fundamentals still good for them, and we expected a busy

543
00:26:50,800 --> 00:26:54,400
Speaker 11: hurricane season. Kind of new conditions were conducive to that happening,

544
00:26:55,080 --> 00:26:57,159
Speaker 11: and there was a lot of formation. It just there

545
00:26:57,160 --> 00:27:01,960
Speaker 11: weren't a lot of big landfalls but these stocks they're defensive,

546
00:27:02,080 --> 00:27:03,600
Speaker 11: so it's like kind of when you get worried about

547
00:27:03,640 --> 00:27:05,680
Speaker 11: the economy, they do okay, But then they can also

548
00:27:06,000 --> 00:27:09,200
Speaker 11: benefit from the economy, so they're a nice play on

549
00:27:09,560 --> 00:27:14,679
Speaker 11: both of those things. Interest rates going down is less

550
00:27:14,800 --> 00:27:17,159
Speaker 11: of an impact on them than other financials. It's not

551
00:27:17,240 --> 00:27:19,600
Speaker 11: great for them. It helped them a lot, but if

552
00:27:19,600 --> 00:27:23,359
Speaker 11: you have to own financials, they're less sensitive to interest

553
00:27:23,440 --> 00:27:26,040
Speaker 11: rate moves. So there's a bunch of positives there. I see,

554
00:27:26,240 --> 00:27:30,600
Speaker 11: sorry when I see fundamentals probably peaking, so you know,

555
00:27:30,640 --> 00:27:34,120
Speaker 11: we might be at that point, but still still good fundamentals.

556
00:27:34,640 --> 00:27:36,479
Speaker 3: This might be a really silly question, but did the

557
00:27:36,480 --> 00:27:39,480
Speaker 3: insurance policies just for homeowners are even small businesses. Do

558
00:27:39,560 --> 00:27:42,640
Speaker 3: they ensure the right things for the type of weather

559
00:27:42,680 --> 00:27:44,040
Speaker 3: pattern changes that we're seeing?

560
00:27:44,840 --> 00:27:49,600
Speaker 11: Good question? So that makes me so, well, here's the

561
00:27:49,640 --> 00:27:51,840
Speaker 11: thing is that they do. So they step back the

562
00:27:51,840 --> 00:27:55,400
Speaker 11: home insurance industry. It's not like they're raking in profits.

563
00:27:55,440 --> 00:27:57,159
Speaker 11: It's not like, oh, there's a big flood and we

564
00:27:57,200 --> 00:27:58,720
Speaker 11: didn't have to pay for it, and we're making a

565
00:27:58,720 --> 00:28:01,800
Speaker 11: lot of money. We look so over the past ten years,

566
00:28:02,080 --> 00:28:05,040
Speaker 11: the industry has paid out a dollar and three cents

567
00:28:05,880 --> 00:28:08,880
Speaker 11: for every dollar they've taken in, and that's in losses

568
00:28:08,880 --> 00:28:12,200
Speaker 11: and expenses. And that's even excluding you know, storm surge

569
00:28:12,240 --> 00:28:16,359
Speaker 11: and flood. So it's not any incredibly profitable business to

570
00:28:16,440 --> 00:28:19,800
Speaker 11: be in anyway. So if you were to say, Okay,

571
00:28:19,840 --> 00:28:23,639
Speaker 11: now these guys have to ensure flood, they have to

572
00:28:23,680 --> 00:28:27,280
Speaker 11: in storm surge, then the prices of these policies would

573
00:28:27,280 --> 00:28:30,439
Speaker 11: need to double. So to answer your question, out, they're not.

574
00:28:31,119 --> 00:28:34,680
Speaker 11: But for them to ensure everything they need to would

575
00:28:34,680 --> 00:28:36,879
Speaker 11: be prohibitively expensive.

576
00:28:37,320 --> 00:28:40,440
Speaker 3: It's sort of like how I wouldn't have wildfire insurance

577
00:28:40,480 --> 00:28:42,320
Speaker 3: for a New York apartment, but then we had all

578
00:28:42,320 --> 00:28:44,880
Speaker 3: that wildfire smoke, Like if that becomes like a common

579
00:28:44,920 --> 00:28:47,160
Speaker 3: occurrence and it messes up with I don't know, whatever

580
00:28:47,280 --> 00:28:49,360
Speaker 3: things you have in your house or apartment, like, that's

581
00:28:49,360 --> 00:28:50,080
Speaker 3: different anyway.

582
00:28:50,280 --> 00:28:53,360
Speaker 5: Just I think did Warren Buffett go into the Florida

583
00:28:53,440 --> 00:28:56,440
Speaker 5: insurance market in the last several years and was that

584
00:28:56,480 --> 00:28:57,080
Speaker 5: a mistaken with.

585
00:28:57,120 --> 00:29:04,440
Speaker 11: Hindsight, so Berkshire has obviously vast insurance businesses. Geico's a

586
00:29:04,440 --> 00:29:09,200
Speaker 11: big auto insurance writer in Florida. In twenty twenty three,

587
00:29:09,600 --> 00:29:13,200
Speaker 11: they made a big bet on the Florida reinsurance market

588
00:29:13,760 --> 00:29:15,960
Speaker 11: and that paid off handsomely for them. They could have

589
00:29:16,040 --> 00:29:18,440
Speaker 11: lost a lot there, but it actually worked out well.

590
00:29:19,600 --> 00:29:21,240
Speaker 11: You know, we would have to hear from them, but

591
00:29:22,400 --> 00:29:24,560
Speaker 11: it appears that they kind of completely backed off of

592
00:29:24,560 --> 00:29:26,800
Speaker 11: that market this year, which turns out to be another

593
00:29:26,800 --> 00:29:32,000
Speaker 11: good idea. So they'll have losses in there, no doubt,

594
00:29:32,040 --> 00:29:35,320
Speaker 11: it will not be anywhere near the magnitude that it

595
00:29:35,320 --> 00:29:38,160
Speaker 11: would impact another insurance company with a smaller balance sheet,

596
00:29:38,280 --> 00:29:40,320
Speaker 11: So they'll have some losses from this. But last year

597
00:29:40,320 --> 00:29:42,560
Speaker 11: they made a big bet on Florida the paid off

598
00:29:42,600 --> 00:29:45,920
Speaker 11: this year. Pulling out that big bet was beneficial.

599
00:29:46,040 --> 00:29:47,920
Speaker 5: I didn't know insurance simms could go in and out

600
00:29:47,920 --> 00:29:49,240
Speaker 5: of market so quickly.

601
00:29:49,080 --> 00:29:52,520
Speaker 11: So in the reinsurance market is easier, right, Like they

602
00:29:52,520 --> 00:29:55,320
Speaker 11: can reprice on an annual they can all reprice on an

603
00:29:55,320 --> 00:29:58,320
Speaker 11: annual basis. But there's less regulation in that market, so

604
00:29:58,320 --> 00:30:01,960
Speaker 11: they can they can write or not anywhere in the

605
00:30:01,960 --> 00:30:03,120
Speaker 11: world kind of where they want to.

606
00:30:03,800 --> 00:30:06,280
Speaker 3: All right, matt thanks lot, I really appreciate it. Matthew Palizowa,

607
00:30:06,320 --> 00:30:09,400
Speaker 3: Bloomerg Intelligence Senior ANALYSP and C Insurance. We didn't even

608
00:30:09,400 --> 00:30:11,280
Speaker 3: get to the cat bond market but apparently there were

609
00:30:11,360 --> 00:30:14,240
Speaker 3: estimates that those catastrophic bonds would lose as much as

610
00:30:14,280 --> 00:30:17,360
Speaker 3: fifteen percent, and now that's been repriced as well, so

611
00:30:17,400 --> 00:30:20,000
Speaker 3: now maybe we're in single digit losses for that.

612
00:30:21,600 --> 00:30:25,480
Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

613
00:30:25,560 --> 00:30:29,080
Speaker 1: weekdays at ten am Eastern on applecar Play and Android

614
00:30:29,120 --> 00:30:31,880
Speaker 1: Auto with the Bloomberg Business app. You can also listen

615
00:30:32,000 --> 00:30:35,080
Speaker 1: live on Amazon Alexa from our flagship New York station,

616
00:30:35,480 --> 00:30:38,200
Speaker 1: Just Say Alexa play Bloomberg eleven.

617
00:30:37,960 --> 00:30:41,600
Speaker 5: Thirty, Alex Steel, Paul Sweeney live here in our Bloomberg

618
00:30:41,720 --> 00:30:44,240
Speaker 5: ARCTA Brooker's studio in New York City, or streaming live

619
00:30:44,280 --> 00:30:47,240
Speaker 5: on YouTube as well Bloomberg Radio Live. That's kind of

620
00:30:47,240 --> 00:30:48,960
Speaker 5: where you can find us there when you search, I'll

621
00:30:48,960 --> 00:30:50,600
Speaker 5: tell you it. In the world of M and A,

622
00:30:50,680 --> 00:30:52,840
Speaker 5: I'm not sure i'd want to be a banker today.

623
00:30:53,080 --> 00:30:55,480
Speaker 5: Maybe an M and A lawyer is something that would

624
00:30:55,520 --> 00:30:57,000
Speaker 5: be I think I bill by.

625
00:30:56,920 --> 00:30:57,760
Speaker 7: The hour and get paid.

626
00:30:57,880 --> 00:31:01,240
Speaker 5: Or any trust lawyer, any trustler. Boom, because this FTC

627
00:31:01,440 --> 00:31:04,200
Speaker 5: is no joke under President Biden. At Lena Khan, who

628
00:31:04,200 --> 00:31:07,720
Speaker 5: heads this Federal Trade Commission. She is tough and she

629
00:31:07,840 --> 00:31:09,960
Speaker 5: is a subject of our Big Take story today. Lena

630
00:31:10,040 --> 00:31:13,640
Speaker 5: Khan has plenty more targets if she gets another term.

631
00:31:13,760 --> 00:31:15,720
Speaker 5: Joining us is Max Chafkin. He's a senior reporter for

632
00:31:15,760 --> 00:31:18,840
Speaker 5: Bloomberg BusinessWeek, and the story does appear in Bloomberg BusinessWeek

633
00:31:19,200 --> 00:31:23,360
Speaker 5: this week. It's his co author's Josh Idelsen Max Chafkins

634
00:31:23,400 --> 00:31:25,720
Speaker 5: with this year, Max talk to us about Lena Khan.

635
00:31:25,960 --> 00:31:29,840
Speaker 5: Who is she and how does she view the FTC

636
00:31:30,040 --> 00:31:33,680
Speaker 5: as perhaps a check on consolidation and number of industries.

637
00:31:33,760 --> 00:31:36,320
Speaker 10: Yeah, Lena Khan is a really interesting figure in the

638
00:31:36,360 --> 00:31:39,000
Speaker 10: Biden administration but also as a political figure today.

639
00:31:39,120 --> 00:31:39,920
Speaker 8: She's very young.

640
00:31:40,000 --> 00:31:43,520
Speaker 10: She's the youngest ever FTC chair at age thirty five.

641
00:31:44,360 --> 00:31:46,680
Speaker 10: She also, you know, she sometimes described as an academic,

642
00:31:47,000 --> 00:31:49,400
Speaker 10: but her academic career was very brief. She basically went

643
00:31:49,480 --> 00:31:52,280
Speaker 10: almost straight from law school to this position. And she

644
00:31:52,400 --> 00:31:56,160
Speaker 10: became kind of famous for writing this article in twenty

645
00:31:56,200 --> 00:31:59,600
Speaker 10: seventeen arguing that, you know, regulators need to look at

646
00:31:59,640 --> 00:32:03,560
Speaker 10: Anti Tree different differently, in particular in relation to Amazon.

647
00:32:03,920 --> 00:32:07,000
Speaker 8: So in the past most people said.

648
00:32:06,920 --> 00:32:10,000
Speaker 10: Hey, if prices are going down, that's good for consumers,

649
00:32:10,160 --> 00:32:12,280
Speaker 10: No need to worry about it, Leni Khan argued in

650
00:32:12,360 --> 00:32:16,440
Speaker 10: this paper that there are other costs of having Amazon

651
00:32:16,520 --> 00:32:20,320
Speaker 10: dominate so many industries, cost to businesses, other smaller businesses,

652
00:32:20,520 --> 00:32:23,280
Speaker 10: cost to labor, and maybe ultimately cost to consumers.

653
00:32:23,480 --> 00:32:25,160
Speaker 8: And that view.

654
00:32:25,080 --> 00:32:28,160
Speaker 10: Has kind of powered this new movement that has scrutinized

655
00:32:28,440 --> 00:32:30,320
Speaker 10: a lot of the big tech companies. We've seen anti

656
00:32:30,320 --> 00:32:34,200
Speaker 10: trust actions against you know, Google and Apple and Amazon

657
00:32:34,400 --> 00:32:37,680
Speaker 10: and as well as as you're saying, a level of

658
00:32:37,680 --> 00:32:41,200
Speaker 10: scrutiny on mergers that that feels new, that feels somewhat

659
00:32:41,200 --> 00:32:42,400
Speaker 10: different from the past.

660
00:32:42,560 --> 00:32:43,280
Speaker 2: That's so interesting.

661
00:32:43,320 --> 00:32:45,000
Speaker 3: I love the way you phrase that. So we usually

662
00:32:45,040 --> 00:32:46,920
Speaker 3: think about it as does it hurt consumers? And now

663
00:32:46,920 --> 00:32:50,040
Speaker 3: we're thinking about hurting in a much broader sense. So

664
00:32:50,240 --> 00:32:52,560
Speaker 3: if if we get a Harris or Trump.

665
00:32:52,320 --> 00:32:54,600
Speaker 2: Well we're gonna get one of them. So does that.

666
00:32:54,600 --> 00:32:56,840
Speaker 3: Change because one can make an argument that I'm sure

667
00:32:56,880 --> 00:33:00,200
Speaker 3: Wall Street is pressing the Harris camp to all so

668
00:33:00,600 --> 00:33:02,240
Speaker 3: have changes at the FTC.

669
00:33:02,600 --> 00:33:03,080
Speaker 8: Yeah.

670
00:33:03,120 --> 00:33:04,960
Speaker 10: My co writer on this, Josh Eidelson, and I spent

671
00:33:05,040 --> 00:33:07,720
Speaker 10: a lot of time talking to various you know, donor

672
00:33:07,800 --> 00:33:10,360
Speaker 10: types and people who are pushing for various things. And

673
00:33:10,400 --> 00:33:13,440
Speaker 10: what you learn is that the people who seem to

674
00:33:13,480 --> 00:33:18,080
Speaker 10: be most vocal right now are sort of centrist Democrats

675
00:33:18,080 --> 00:33:20,960
Speaker 10: and centrist Republicans, both of those, both of those groups

676
00:33:20,960 --> 00:33:23,120
Speaker 10: the kind of who represents sort of what you might

677
00:33:23,160 --> 00:33:25,840
Speaker 10: think of as like the normal kind of corporate consensus,

678
00:33:25,840 --> 00:33:28,760
Speaker 10: the way that a lot of people thought about how

679
00:33:28,800 --> 00:33:31,920
Speaker 10: government should relate to business over the last forty years

680
00:33:32,000 --> 00:33:32,160
Speaker 10: or so.

681
00:33:32,480 --> 00:33:33,240
Speaker 8: They all are.

682
00:33:33,200 --> 00:33:35,040
Speaker 10: Kind of against Lena con in one way or another.

683
00:33:35,080 --> 00:33:38,400
Speaker 10: You've seen a lot of angry, very angry Silicon Valley

684
00:33:38,400 --> 00:33:41,160
Speaker 10: types saying that she's you know, destroying M and A,

685
00:33:41,280 --> 00:33:43,640
Speaker 10: destroying the venture capital industry and so on, and you're

686
00:33:43,640 --> 00:33:44,880
Speaker 10: seeing that kind of thing.

687
00:33:44,840 --> 00:33:47,040
Speaker 8: From sort of chamber of commerce Republican types.

688
00:33:47,240 --> 00:33:50,600
Speaker 10: Now where you see support is kind of the squad,

689
00:33:50,400 --> 00:33:53,960
Speaker 10: the sort of progressive left that likes Lena Khan because.

690
00:33:53,680 --> 00:33:54,600
Speaker 8: She's pro union.

691
00:33:55,040 --> 00:33:58,280
Speaker 10: There's also some support from some corners of Silicon Valley,

692
00:33:58,480 --> 00:34:01,000
Speaker 10: the parts of Silicon Valley that maybe are mad about

693
00:34:01,040 --> 00:34:03,920
Speaker 10: Google and Amazon being so dominant. And then on the

694
00:34:04,040 --> 00:34:07,959
Speaker 10: right you actually see support as well, because sort of

695
00:34:08,000 --> 00:34:12,080
Speaker 10: like the trumpest right, the MAGA right, jd Vance types,

696
00:34:12,160 --> 00:34:15,160
Speaker 10: the sort of young Trump supporters who tend to be

697
00:34:15,239 --> 00:34:19,440
Speaker 10: really mad about tech dominance and also have somewhat populist

698
00:34:19,560 --> 00:34:23,239
Speaker 10: views on business and on how government should should relate

699
00:34:23,280 --> 00:34:23,720
Speaker 10: to business.

700
00:34:23,920 --> 00:34:27,640
Speaker 5: Do we have any idea how Vice President Harris feels

701
00:34:27,640 --> 00:34:30,400
Speaker 5: about Lena Khan in this FTC She has.

702
00:34:30,320 --> 00:34:32,520
Speaker 8: Been studiously vague.

703
00:34:32,600 --> 00:34:36,239
Speaker 10: I would say I think the closest sign we have

704
00:34:36,400 --> 00:34:40,719
Speaker 10: is this the price gouging proposal, Because so Harris announced

705
00:34:40,719 --> 00:34:43,719
Speaker 10: that she was going to have the FTC crackdown on

706
00:34:43,800 --> 00:34:46,960
Speaker 10: price gouging by grocery stores. That would be an expansion

707
00:34:46,960 --> 00:34:49,799
Speaker 10: of the FTC's authority. We asked Lena Khan about this,

708
00:34:49,920 --> 00:34:53,040
Speaker 10: and you know, her answer was somewhat careful and political,

709
00:34:53,040 --> 00:34:55,520
Speaker 10: but essentially was like, hey, I'm open to it, and

710
00:34:55,600 --> 00:34:57,600
Speaker 10: she made clear, you know, she would like to serve

711
00:34:57,640 --> 00:35:00,000
Speaker 10: another term. She feels there is a lot of work

712
00:35:00,120 --> 00:35:02,319
Speaker 10: to be done, and you've seen over the last few

713
00:35:02,320 --> 00:35:04,880
Speaker 10: months the FTC has been very active. I think they

714
00:35:04,880 --> 00:35:06,280
Speaker 10: will continue to be very active.

715
00:35:07,120 --> 00:35:10,000
Speaker 3: We heard Jamie Diamond speak with Lisa Brahmins earlier this week,

716
00:35:10,239 --> 00:35:13,279
Speaker 3: CEO of JP Morgan very much again saying who thinks

717
00:35:13,280 --> 00:35:15,160
Speaker 3: that CEOs should have a seat at the table? That

718
00:35:15,239 --> 00:35:18,080
Speaker 3: like half the cabinet should be probably overdid it, but

719
00:35:18,320 --> 00:35:20,960
Speaker 3: half the cabinet should be CEOs and so I'm just

720
00:35:21,080 --> 00:35:25,400
Speaker 3: wondering how that plays in to an FTC that is

721
00:35:25,480 --> 00:35:28,000
Speaker 3: more aggressive against company mergers, like will there be a

722
00:35:28,040 --> 00:35:29,320
Speaker 3: relationship to be had.

723
00:35:29,760 --> 00:35:31,799
Speaker 10: I mean, the most interesting thing to me about the

724
00:35:31,840 --> 00:35:34,920
Speaker 10: Biden administration has been in years past. You know, I

725
00:35:35,040 --> 00:35:37,800
Speaker 10: typically cover Silicon Valley, and when Silicon Valley would say

726
00:35:38,200 --> 00:35:41,320
Speaker 10: this person is anti tech, this politician anti tech, that

727
00:35:41,320 --> 00:35:43,880
Speaker 10: would provoke a reaction because no politician wants to be

728
00:35:43,920 --> 00:35:46,360
Speaker 10: seen as anti tech or hasn't been. And the difference

729
00:35:46,400 --> 00:35:48,760
Speaker 10: with Biden, and I think to some extent the difference

730
00:35:48,800 --> 00:35:51,359
Speaker 10: with Trump, is both of them have been comfortable with that.

731
00:35:51,600 --> 00:35:54,240
Speaker 10: They say, you want to be mad at me billionaires, Okay,

732
00:35:54,440 --> 00:35:55,719
Speaker 10: you know that's good politics.

733
00:35:55,719 --> 00:35:57,719
Speaker 8: I'm a populist. People tend to like that.

734
00:35:57,960 --> 00:36:00,160
Speaker 10: And we actually heard that, And there's some quote in

735
00:36:00,239 --> 00:36:02,360
Speaker 10: this story of this effect, like you know, Reid.

736
00:36:02,200 --> 00:36:04,399
Speaker 8: Hoffmann speaking out against Lena Khan.

737
00:36:04,680 --> 00:36:06,759
Speaker 10: There are people on the left who think he is

738
00:36:06,840 --> 00:36:09,040
Speaker 10: doing Lena Khan a huge favor because he's gonna make

739
00:36:09,080 --> 00:36:12,959
Speaker 10: it very hard politically to fire her. And I think

740
00:36:13,000 --> 00:36:15,680
Speaker 10: this position, the position you're hearing from Jamie Diamond and

741
00:36:15,760 --> 00:36:18,200
Speaker 10: from lots of people in kind of the centrist, kind

742
00:36:18,239 --> 00:36:19,640
Speaker 10: of traditional, you know.

743
00:36:19,600 --> 00:36:20,440
Speaker 8: Corporate roles.

744
00:36:21,160 --> 00:36:23,680
Speaker 10: I don't know how popular it is politically. The the

745
00:36:24,840 --> 00:36:27,520
Speaker 10: ideas that are on the ascent are really populist ideas

746
00:36:27,520 --> 00:36:28,840
Speaker 10: and you're seeing that on both sides.

747
00:36:29,320 --> 00:36:30,680
Speaker 7: And it's not just Lena Khan.

748
00:36:31,320 --> 00:36:33,880
Speaker 5: You know, you look at the Department of Justice, you're

749
00:36:33,920 --> 00:36:36,680
Speaker 5: reporting your your piece here, they're taking a tough rule

750
00:36:37,120 --> 00:36:41,440
Speaker 5: against Google, for example, Apple SEC chairman Garagant to pushing

751
00:36:41,480 --> 00:36:42,120
Speaker 5: back on crypto.

752
00:36:42,360 --> 00:36:44,040
Speaker 7: So this is not just a Lena Khan thing.

753
00:36:44,120 --> 00:36:44,960
Speaker 8: No, absolutely not.

754
00:36:45,120 --> 00:36:47,279
Speaker 10: And I think, yeah, Jonathan Kanter, who's the head of

755
00:36:47,280 --> 00:36:51,440
Speaker 10: Anti Trust that the DOJ, Gary Gensler, you said SEC.

756
00:36:52,239 --> 00:36:54,759
Speaker 8: It is Lena Khan has come to symbolize something.

757
00:36:54,760 --> 00:36:57,560
Speaker 10: And I think that it's partly because of her youth

758
00:36:57,800 --> 00:36:59,600
Speaker 10: and and because of who she is and where she

759
00:36:59,640 --> 00:37:03,160
Speaker 10: comes from. She's not a conventional Washington figure in any way.

760
00:37:03,360 --> 00:37:06,720
Speaker 10: And also because you get this attitude that she doesn't care.

761
00:37:07,120 --> 00:37:10,080
Speaker 8: That and that can rub people the wrong way. And

762
00:37:10,120 --> 00:37:11,920
Speaker 8: I think it does rub people the wrong way.

763
00:37:11,920 --> 00:37:15,000
Speaker 10: When you talk to business people, they are mad about policy,

764
00:37:15,040 --> 00:37:17,359
Speaker 10: but they are also mad about tone, and I think

765
00:37:17,400 --> 00:37:20,400
Speaker 10: that is some of what they're reacting to. And but

766
00:37:20,480 --> 00:37:22,760
Speaker 10: of course that has its that has a political upside.

767
00:37:22,760 --> 00:37:26,840
Speaker 10: We saw yesterday AOC coming out really swinging in favor

768
00:37:26,880 --> 00:37:29,640
Speaker 10: of Lena Khan after Mark Cuban made some comments, he

769
00:37:29,640 --> 00:37:31,600
Speaker 10: made some similar comments to us that we put in

770
00:37:31,600 --> 00:37:34,640
Speaker 10: our story, but essentially criticizing Lena con AOC, saying it's

771
00:37:34,640 --> 00:37:36,720
Speaker 10: going to be an all out brawl if you wanna,

772
00:37:37,680 --> 00:37:40,760
Speaker 10: if anyone wants to remove her. So I think this

773
00:37:40,960 --> 00:37:45,280
Speaker 10: will be an interesting political issue whoever is elected in November.

774
00:37:45,400 --> 00:37:48,160
Speaker 3: All right, Max, thanks lot, really appreciate it. Max Chafkin,

775
00:37:48,200 --> 00:37:50,279
Speaker 3: a Bloomberg at BusinessWeek senior reporter, this.

776
00:37:50,239 --> 00:37:51,120
Speaker 2: Is the big take piece.

777
00:37:51,280 --> 00:37:52,880
Speaker 3: You can check it out on Blueberg business Week and

778
00:37:52,920 --> 00:37:56,520
Speaker 3: also a big take on the Bloomberg terminal. Really good stuff.

779
00:37:56,560 --> 00:37:58,560
Speaker 3: It's gonna be so fascinating. And if you're, you know,

780
00:37:58,560 --> 00:38:00,160
Speaker 3: a CEO, do you want to get into the M

781
00:38:00,160 --> 00:38:01,799
Speaker 3: and A line and just kind of wait there or

782
00:38:01,800 --> 00:38:03,479
Speaker 3: do you want to wait and see what happens after

783
00:38:03,520 --> 00:38:04,960
Speaker 3: November and what happens to Lena Cohn?

784
00:38:05,080 --> 00:38:05,960
Speaker 2: Like what's your strategy?

785
00:38:05,960 --> 00:38:06,120
Speaker 3: You know?

786
00:38:06,200 --> 00:38:08,600
Speaker 5: Yeah, it seems like we talk to Jenri who's anti

787
00:38:08,680 --> 00:38:12,280
Speaker 5: trust analyst at Bloomberg Intelligence, seemingly almost every week about

788
00:38:12,280 --> 00:38:14,040
Speaker 5: every deal that gets announced, we got to go to

789
00:38:14,120 --> 00:38:15,080
Speaker 5: jenary and say, are these right?

790
00:38:15,080 --> 00:38:15,200
Speaker 1: There?

791
00:38:15,320 --> 00:38:16,319
Speaker 7: Is going to let this thing go?

792
00:38:16,480 --> 00:38:18,720
Speaker 3: Ito's busier George Ferguson or Jenri exactly?

793
00:38:18,960 --> 00:38:20,759
Speaker 2: I don't know. I think it's a toss up at

794
00:38:20,760 --> 00:38:21,160
Speaker 2: this point.

795
00:38:22,680 --> 00:38:26,560
Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

796
00:38:26,640 --> 00:38:30,160
Speaker 1: weekdays at ten am Eastern on applecard Play and Android

797
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798
00:38:33,440 --> 00:38:36,640
Speaker 1: on Amazon Alexa from our flagship New York station. Just

799
00:38:36,680 --> 00:38:39,320
Speaker 1: say Alexa play Bloomberg eleven thirty.

800
00:38:40,800 --> 00:38:42,200
Speaker 2: This is Bloomberg Intelligence Radio.

801
00:38:42,239 --> 00:38:43,959
Speaker 3: We bring you all the top news, not about lice

802
00:38:44,040 --> 00:38:46,600
Speaker 3: or Amazon, but other stuff too through our lens of

803
00:38:46,600 --> 00:38:49,120
Speaker 3: our Bloomberg Intelligence folks. They cover two thousand companies one

804
00:38:49,200 --> 00:38:52,160
Speaker 3: hundred and thirty industries around the world. Tim Craighead joins

805
00:38:52,200 --> 00:38:55,160
Speaker 3: us now from Bloomberg Intelligence. He's a global chief content officer.

806
00:38:55,200 --> 00:38:57,960
Speaker 3: He has his eyes on everything and they have a

807
00:38:58,000 --> 00:39:00,880
Speaker 3: great note out that talks about ten companies to watch

808
00:39:00,960 --> 00:39:04,080
Speaker 3: in the fourth quarter. All right, can you pick your

809
00:39:04,120 --> 00:39:04,799
Speaker 3: favorite like.

810
00:39:04,760 --> 00:39:05,200
Speaker 2: I have ones.

811
00:39:05,200 --> 00:39:06,839
Speaker 3: I want to ask you about, Tim, but you pick

812
00:39:06,880 --> 00:39:08,239
Speaker 3: your favorite and let's start there.

813
00:39:09,080 --> 00:39:11,640
Speaker 12: Well, you guys are talking about talking to your bartender

814
00:39:11,920 --> 00:39:15,399
Speaker 12: and your Amazon driver. You're going to do that after

815
00:39:15,440 --> 00:39:17,200
Speaker 12: you visit truly even better.

816
00:39:19,200 --> 00:39:22,040
Speaker 2: All right, So what's that company and why?

817
00:39:22,120 --> 00:39:25,080
Speaker 12: So you know, just to put context, this list of

818
00:39:25,120 --> 00:39:29,000
Speaker 12: ten are all focus ideas of ours. So companies where

819
00:39:29,040 --> 00:39:31,080
Speaker 12: we have a high conviction view that we think is

820
00:39:31,120 --> 00:39:33,720
Speaker 12: different from what the market thinks. And there's catalyst ahead.

821
00:39:34,160 --> 00:39:39,799
Speaker 12: True Leave is a marijuana grower and a distributor. They

822
00:39:39,800 --> 00:39:42,200
Speaker 12: have stores. Seventy percent of their stores are in Florida,

823
00:39:42,880 --> 00:39:49,520
Speaker 12: and Florida has on the referendum this November the potential

824
00:39:49,520 --> 00:39:52,520
Speaker 12: for legalization for recreational use. It would be a big

825
00:39:52,560 --> 00:39:54,600
Speaker 12: deal for Truely if this were to come through.

826
00:39:55,280 --> 00:39:56,800
Speaker 7: Yeah, I'm maybe Florida a huge market.

827
00:39:56,880 --> 00:39:58,920
Speaker 5: And you know what I recognized when we went over

828
00:39:58,920 --> 00:40:01,200
Speaker 5: to Ireland, coupic Scope, they don't do the gummy thing

829
00:40:01,239 --> 00:40:01,640
Speaker 5: over there.

830
00:40:01,840 --> 00:40:04,279
Speaker 7: They don't have the weed thing. They're gonna get on

831
00:40:04,320 --> 00:40:04,600
Speaker 7: board there.

832
00:40:04,640 --> 00:40:08,480
Speaker 2: They maybe that's they don't really need to that.

833
00:40:08,600 --> 00:40:10,399
Speaker 12: They just go to New York and then they come

834
00:40:10,440 --> 00:40:10,879
Speaker 12: back to.

835
00:40:11,120 --> 00:40:12,560
Speaker 7: Exact Ireland exactly.

836
00:40:12,920 --> 00:40:14,959
Speaker 5: Anti Sports talk to us about that because I feel

837
00:40:14,960 --> 00:40:17,400
Speaker 5: like I know they're an Asian company, so I'm assuming

838
00:40:17,400 --> 00:40:20,760
Speaker 5: this has a China call to it.

839
00:40:20,760 --> 00:40:24,560
Speaker 12: It does with an interesting twist. Anta is a is

840
00:40:24,600 --> 00:40:27,200
Speaker 12: a sports wear company. They have a number of brands.

841
00:40:27,640 --> 00:40:30,120
Speaker 12: I think when I've been on your show before, you

842
00:40:30,200 --> 00:40:34,840
Speaker 12: may have seen that I've had an Arctics best on.

843
00:40:35,080 --> 00:40:40,080
Speaker 5: Tim is like an extreme biker, climber hiker, all the stuff.

844
00:40:39,800 --> 00:40:41,560
Speaker 2: That I just have good for you.

845
00:40:42,000 --> 00:40:44,839
Speaker 12: I got nothing on that, But no Arctics is owned

846
00:40:44,880 --> 00:40:48,359
Speaker 12: by Anta. But the reason why Anta is on here

847
00:40:48,440 --> 00:40:50,759
Speaker 12: is twofold number one. Do have a lot of things

848
00:40:50,800 --> 00:40:52,960
Speaker 12: going on from the standpoint of driving their business with

849
00:40:53,040 --> 00:40:59,000
Speaker 12: various brands, and the Olympics playthrough will get results when

850
00:40:59,000 --> 00:41:02,560
Speaker 12: they report next in terms of how good it's been.

851
00:41:02,719 --> 00:41:07,879
Speaker 12: The China national team were anti sports kit. But it's

852
00:41:07,920 --> 00:41:11,680
Speaker 12: also a case. You've seen lots of news about Adidas

853
00:41:11,840 --> 00:41:14,600
Speaker 12: and Nike and how they're trying to get their inventory

854
00:41:14,680 --> 00:41:19,600
Speaker 12: under control. That's making pricing better for sports where generally,

855
00:41:19,719 --> 00:41:23,240
Speaker 12: and we think that that's playing through into anti sports

856
00:41:23,239 --> 00:41:25,080
Speaker 12: margins as a corollary.

857
00:41:25,400 --> 00:41:27,880
Speaker 3: That's interesting when you compare it to like say Nike,

858
00:41:27,960 --> 00:41:30,680
Speaker 3: I understand that they do different things, but still you've

859
00:41:30,760 --> 00:41:35,040
Speaker 3: also on here, so this is basically straight up railroad stock.

860
00:41:35,640 --> 00:41:36,640
Speaker 2: Why do you guys like this one.

861
00:41:37,520 --> 00:41:39,919
Speaker 12: Well, there's two things here. If you were to look

862
00:41:40,040 --> 00:41:43,439
Speaker 12: at a three year, five year type chart, you would

863
00:41:43,480 --> 00:41:47,799
Speaker 12: see that this company has gone through some problems. They

864
00:41:47,840 --> 00:41:51,400
Speaker 12: had a big right off and problem that was announced

865
00:41:51,440 --> 00:41:55,120
Speaker 12: a year or so ago, stock had collapsed. That's been

866
00:41:55,280 --> 00:41:58,280
Speaker 12: settled and they're on the right track. No pun intended

867
00:41:58,920 --> 00:42:03,399
Speaker 12: at this point. But importantly, there is a new European

868
00:42:03,800 --> 00:42:08,480
Speaker 12: union wide signaling system that's coming into place that is

869
00:42:09,239 --> 00:42:13,120
Speaker 12: meant to be reducing a lot of complication between different

870
00:42:13,160 --> 00:42:16,160
Speaker 12: countries and whatnot. And it's an Alstom system. And in

871
00:42:16,200 --> 00:42:19,719
Speaker 12: general the train businesses is running pretty well. We think

872
00:42:19,760 --> 00:42:21,120
Speaker 12: they're on a road for recovery.

873
00:42:22,239 --> 00:42:24,560
Speaker 5: Tim the biggest mark or one of the bigger market

874
00:42:24,560 --> 00:42:28,520
Speaker 5: cap names on your list is Saudi National Bank. And

875
00:42:28,600 --> 00:42:31,399
Speaker 5: I'll start with I know nothing about Saudi National Bank,

876
00:42:31,440 --> 00:42:33,000
Speaker 5: but it's fifty seven billion market cap.

877
00:42:33,120 --> 00:42:33,919
Speaker 7: What's the story there?

878
00:42:34,880 --> 00:42:37,520
Speaker 12: Yeah, you know, it's really interesting. And this is true

879
00:42:37,560 --> 00:42:40,520
Speaker 12: for Saudi National Bank, it's also true for some others

880
00:42:40,840 --> 00:42:47,360
Speaker 12: in the country. It's running contra to what most banks

881
00:42:47,480 --> 00:42:51,000
Speaker 12: are experiencing. I think there's been lots of news and

882
00:42:51,040 --> 00:42:54,240
Speaker 12: coverage and certainly we've written about the pressure coming ahead

883
00:42:54,320 --> 00:42:59,240
Speaker 12: for most banks with their net interest margins as interest

884
00:42:59,360 --> 00:43:03,000
Speaker 12: rates start to decline. You know, their their loan pricing

885
00:43:03,120 --> 00:43:05,640
Speaker 12: comes down, and you know that's not great for margins.

886
00:43:06,760 --> 00:43:10,280
Speaker 12: Saudi National Bank isn't is an interesting case. We're given

887
00:43:10,320 --> 00:43:14,319
Speaker 12: the nature of how their loans reprice versus their deposits

888
00:43:14,440 --> 00:43:18,040
Speaker 12: repricing they actually stand to see over the course of

889
00:43:18,080 --> 00:43:20,640
Speaker 12: the next six to twelve months, and then interest margin

890
00:43:20,760 --> 00:43:26,000
Speaker 12: growth and expansion, and so it's running counter given just

891
00:43:26,040 --> 00:43:31,160
Speaker 12: simply the nature of their asset and liability mix to

892
00:43:30,560 --> 00:43:34,239
Speaker 12: to normal bank profitability in the current cycle we're in.

893
00:43:34,360 --> 00:43:35,960
Speaker 12: So it's a really unusual story.

894
00:43:36,520 --> 00:43:38,400
Speaker 3: Okay, we got like a minute, can you do for

895
00:43:38,600 --> 00:43:41,759
Speaker 3: solar for me? Because that's gonna for me that's a

896
00:43:41,800 --> 00:43:44,680
Speaker 3: TVD based on what happens with the Inflation Reduction Act

897
00:43:44,680 --> 00:43:45,279
Speaker 3: here in the US.

898
00:43:45,280 --> 00:43:49,279
Speaker 12: But you tell me it absolutely is. I mean, we

899
00:43:49,320 --> 00:43:52,120
Speaker 12: all know that the election coming up is going to

900
00:43:52,480 --> 00:43:56,480
Speaker 12: have a lot of implications for what happens from energy

901
00:43:56,520 --> 00:44:01,239
Speaker 12: transition related spending and whatnot. That said, we're still going

902
00:44:01,320 --> 00:44:05,440
Speaker 12: to see solar panels as a renewable energy source continued

903
00:44:05,480 --> 00:44:10,239
Speaker 12: to grow. These guys are in the Catbird seat, so

904
00:44:10,360 --> 00:44:13,080
Speaker 12: to speak, from the standpoint of they have a dominant

905
00:44:13,120 --> 00:44:15,960
Speaker 12: position in the US. They've got good technology. Even though

906
00:44:16,000 --> 00:44:19,560
Speaker 12: the Chinese producers are bigger and lower cost with arguably

907
00:44:19,600 --> 00:44:23,800
Speaker 12: better technology, there's way too many restrictions for China product

908
00:44:23,880 --> 00:44:27,000
Speaker 12: to come into the States. And so for solar is

909
00:44:27,600 --> 00:44:29,920
Speaker 12: not you wouldn't say it's in a monopoly position, but

910
00:44:29,960 --> 00:44:33,680
Speaker 12: it's a very advantaged position. And almost regardless of what

911
00:44:33,800 --> 00:44:36,800
Speaker 12: happens with the IRA, we think that they've got winded

912
00:44:36,880 --> 00:44:39,879
Speaker 12: their back for better order growth. Going ahead, all.

913
00:44:39,840 --> 00:44:41,480
Speaker 3: Right, Tim, thanks a lot, super appreciate it.

914
00:44:41,480 --> 00:44:43,000
Speaker 2: Tim Kraig. We're gonna get you back because we got

915
00:44:43,000 --> 00:44:43,760
Speaker 2: through what fine.

916
00:44:43,600 --> 00:44:45,400
Speaker 7: Yeah, we're going to get back. Yeah to New York.

917
00:44:45,480 --> 00:44:46,319
Speaker 7: We need to get into New York.

918
00:44:46,760 --> 00:44:48,000
Speaker 2: You want to play, but Mark, let's go back.

919
00:44:48,000 --> 00:44:49,480
Speaker 3: We'll do the other five, all right, Tim Craig kad

920
00:44:49,520 --> 00:44:52,960
Speaker 3: Bloomberg Intelligence a global Chief Content officer, joining us there

921
00:44:52,960 --> 00:44:55,200
Speaker 3: on companies to watch in the fourth quarter.

922
00:44:55,600 --> 00:44:59,920
Speaker 1: This is the Bloomberg Intelligence Podcast, available on Apples, Potify,

923
00:45:00,320 --> 00:45:03,520
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924
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925
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926
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927
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