WEBVTT - Steel, GDP, Geopolitics, and Lamborghini 0:00:00.760 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day, we bring 0:00:06.920 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.520 --> 0:00:15.520 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.600 --> 0:00:18.400 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:21.480 at Bloomberg dot com slash podcast. I want to get 0:00:21.480 --> 0:00:25.239 back to the big picture stories that have been swinging 0:00:25.280 --> 0:00:27.720 this market around, giving us the kind of volatility that 0:00:27.720 --> 0:00:31.680 we haven't certainly in the rates sector seen in decades, 0:00:31.720 --> 0:00:34.239 if ever before, And I want to do that with 0:00:34.320 --> 0:00:41.000 Chris Campbell. He is a senior policy analyst and sorry, 0:00:41.000 --> 0:00:44.639 he's the chief strategist at Kroll, but he has had 0:00:44.680 --> 0:00:50.040 a number of other important look at them before. Yeah, 0:00:50.080 --> 0:00:53.880 former assistant secretary from the US Department of Treasury, he 0:00:54.120 --> 0:00:57.440 went to FSOCK meetings, former Stack director of the Senate 0:00:58.040 --> 0:01:03.040 Finance Committee, and so lifetime member the accountl on Foreign Relations. 0:01:03.080 --> 0:01:06.600 You're basically plugged in on Wall Street and in Washington, Christ, 0:01:06.640 --> 0:01:08.920 So it's great to have you here in the studio 0:01:08.600 --> 0:01:11.520 with you. What do you make of the banking turmoil 0:01:11.600 --> 0:01:14.119 that we've seen in the government response, do you think 0:01:14.120 --> 0:01:17.920 it's behind us? As I say, the system worked, you know, 0:01:17.959 --> 0:01:21.160 like their banks will go under um, and you know, 0:01:21.200 --> 0:01:24.080 companies fail, but uh, and there's going to be an 0:01:24.120 --> 0:01:26.600 enormous amount of investigations going on, you know as to 0:01:26.680 --> 0:01:29.120 why the you know, these two banks failed in the 0:01:29.200 --> 0:01:32.920 United States. But the reality is the federals, federal Federal 0:01:33.120 --> 0:01:37.560 Federal Reserve and Treasury worked very quickly, very expeditiously, and 0:01:37.800 --> 0:01:40.280 decisively to make sure that depositors were taken care of, 0:01:40.640 --> 0:01:42.840 which is the way I think which is important. UM. 0:01:43.080 --> 0:01:45.959 It stopped a run on banks, which, as you know, 0:01:46.120 --> 0:01:49.960 is deeply emotional. And so with with that prevention and 0:01:50.040 --> 0:01:53.880 with the with confidence restored largely, UM, I think that 0:01:53.960 --> 0:01:57.400 we can now go back to a quote unquote normal system, 0:01:57.440 --> 0:01:59.880 if you will, where we're actually seen looking at fun 0:02:00.040 --> 0:02:02.880 mentals for banks and others in the market and uh 0:02:02.920 --> 0:02:06.760 and judging them on their fundamentals. Should we expand insurance 0:02:06.840 --> 0:02:10.600 beyond the two hundred and fifty thousand? How problematic is that? 0:02:10.880 --> 0:02:13.080 It's going to be deeply problematic and very very political 0:02:13.080 --> 0:02:16.360 in DC. UM. You know, it's you can kind of 0:02:16.360 --> 0:02:18.200 see the each side where they're going to come out 0:02:18.200 --> 0:02:20.720 the Democrats, like they're going to say that, uh, you know, 0:02:20.880 --> 0:02:23.360 two hundred fifty thousand dollars is a lot of money 0:02:23.440 --> 0:02:26.160 for most Americans. You know, the average American makes about 0:02:26.160 --> 0:02:29.160 fifty seven thousand dollars a year, So having two unrefty 0:02:29.200 --> 0:02:31.040 thousand dollars in their bank account, it's just you know, 0:02:31.080 --> 0:02:34.560 it's it's it's like it's aspirational um and you know, 0:02:34.600 --> 0:02:38.519 and especially we're talking about savings accounts, right, so yeah, 0:02:38.560 --> 0:02:41.880 if if hopefully, uh, they can save up that much 0:02:42.160 --> 0:02:44.800 before retirement, because people live so long now and if 0:02:44.840 --> 0:02:47.079 you retire at sixty five or seventy, you still got 0:02:47.120 --> 0:02:49.680 another thirty years to fund. But they'll do it in 0:02:49.680 --> 0:02:52.079 different accounts. And there are four one ks and there's 0:02:52.120 --> 0:02:54.600 another issues that are not insured and so and so yeah, 0:02:54.600 --> 0:02:56.359 like I think that, you know, Republicans will take a 0:02:56.360 --> 0:02:58.200 different view of this, and so I just it's very deep, 0:02:58.720 --> 0:03:01.440 very tough to see, especially today's Washington, where there me 0:03:01.639 --> 0:03:05.720 be can census on on any legislation involving banks, changing 0:03:05.760 --> 0:03:08.280 Dodd Frank or anything like that in the current environment. 0:03:08.320 --> 0:03:11.280 But it's de facto done, isn't it. Raising the insurance? 0:03:11.400 --> 0:03:14.480 I mean, even though they're not going to officially do it. Um, 0:03:14.560 --> 0:03:17.239 if you have three hundred thousand, then your regional bank 0:03:17.320 --> 0:03:20.480 goes under, you can count on the government to bail 0:03:20.520 --> 0:03:23.720 you out. It's clear that the Federal Reserve has used 0:03:23.720 --> 0:03:27.160 its powers within Dodd, Frank and and supervisor authority to 0:03:27.240 --> 0:03:29.959 be able to step in and prevent and make sure 0:03:29.960 --> 0:03:32.600 the depositors will made whole. I think you know, again, 0:03:33.280 --> 0:03:35.720 you can argue moral hazard or not, but the reality 0:03:35.840 --> 0:03:37.680 is that that now the Federals Serve has done this. 0:03:37.840 --> 0:03:39.920 It's now well known that they can, and I think 0:03:39.960 --> 0:03:42.200 the depositors now I think you know it should have 0:03:42.240 --> 0:03:45.360 the Commons probably that that that Federserve likely step in 0:03:45.280 --> 0:03:48.280 in the future. Can I bring up a debt limit 0:03:48.360 --> 0:03:50.920 with you negotiating on Oh man, are we talking about 0:03:50.960 --> 0:03:54.640 the debt ceiling? Yeah? We are. I'm so well, we 0:03:54.680 --> 0:03:57.360 have to don't fortunately or not. I've I've actually negotiated 0:03:57.360 --> 0:03:59.840 the last twelve of them. So now is that you 0:04:00.080 --> 0:04:03.040 using that as a point of negotiation over whatever? Is 0:04:03.080 --> 0:04:07.720 that like playing Russian rule in It's very, very difficult 0:04:07.760 --> 0:04:11.200 and deeply problematic to suggest that the United States may 0:04:11.240 --> 0:04:13.760 walk up to the line and actually and not pay 0:04:13.200 --> 0:04:16.760 our bills. Um, it's you know, it's very and for 0:04:16.760 --> 0:04:18.800 for the listeners, it's really important to buy. For Kate, 0:04:19.080 --> 0:04:21.640 this is this is you know, not funding the Post 0:04:21.680 --> 0:04:24.719 office or the National parks. This is paying back our 0:04:24.720 --> 0:04:28.040 debt ors our debt and effectively, you know, and I 0:04:28.120 --> 0:04:31.159 think about this, and I tending which was already approved, 0:04:31.240 --> 0:04:33.320 was that's correct. Spening has already been improved, and actually 0:04:33.320 --> 0:04:36.520 it's already been spent. This is debt that we're paying back, 0:04:36.560 --> 0:04:39.440 and so um, you know, I think it's it really 0:04:39.480 --> 0:04:43.160 does affect the rate at which Treasury or where I 0:04:43.240 --> 0:04:46.599 used to work, can sell our our debt U and 0:04:46.640 --> 0:04:49.360 it'll affect that the amount of that and the confidence 0:04:49.360 --> 0:04:52.039 of people who buy buying our debt. And so the 0:04:52.120 --> 0:04:55.080 reality is, and we make quabble over this is the 0:04:55.160 --> 0:04:57.240 right thing to do or not, But if we you know, 0:04:57.279 --> 0:04:59.839 the government spends one point three dollars for every dollar 0:05:00.080 --> 0:05:02.760 takes in, we just we you know, the federal government 0:05:02.920 --> 0:05:05.480 likes to spend like drug and sailors, um, and they 0:05:05.480 --> 0:05:07.960 don't they don't balance the budget, and so we we 0:05:08.080 --> 0:05:11.360 just rely on debt to finance our operations in our 0:05:11.400 --> 0:05:15.040 in our government and so and so So John and 0:05:15.040 --> 0:05:21.320 I have covered uh these um impasses. The twenty eleven 0:05:21.839 --> 0:05:25.320 um one probably the most noteworthy. When we were our 0:05:25.360 --> 0:05:28.640 credit rating was lowered. You actually were in the room 0:05:28.680 --> 0:05:32.280 negotiating them UM as you said the last twelve. So 0:05:32.320 --> 0:05:34.919 this happens fairly often. Now at Kroll you're in a 0:05:34.960 --> 0:05:37.960 different role where you have to advise your clients on 0:05:38.440 --> 0:05:41.320 um You know what could happen around this in terms 0:05:41.320 --> 0:05:43.880 of the economy, in terms of the markets. What are 0:05:43.880 --> 0:05:46.560 you expecting this time? This will be the hardest one 0:05:46.560 --> 0:05:49.120 I've ever seen. When first, I'm so grateful that I'm 0:05:49.160 --> 0:05:53.560 out there. Uh, it's I really believe this is there 0:05:53.600 --> 0:05:56.480 actually maybe a chance we actually may do a technical 0:05:56.520 --> 0:05:59.360 default in this in this setting, UM, I really don't 0:05:59.400 --> 0:06:02.599 know how how you get there. You have we have 0:06:02.640 --> 0:06:05.320 a president who's unwilling to talk to House Republicans or 0:06:05.360 --> 0:06:07.480 House Republicans or have made it very clear that they 0:06:07.520 --> 0:06:12.280 want spending introductions in the package as an overall way 0:06:12.320 --> 0:06:15.000 to get to yes. And so with that, with those 0:06:15.080 --> 0:06:18.520 two postures, and we're and we're coming. We're going coming 0:06:18.600 --> 0:06:21.360 so quickly up to the to the deadline that there's 0:06:21.480 --> 0:06:24.320 really we're going to quickly come to a time where 0:06:24.320 --> 0:06:26.520 we're actually going to pass a red line where we can't, 0:06:27.040 --> 0:06:28.600 you know, because it just takes time to pass things 0:06:28.640 --> 0:06:31.320 in Congress. Hey, I just want to drain your experience. 0:06:31.440 --> 0:06:34.160 You were got about thirty seconds, Leff, you were Orange 0:06:34.200 --> 0:06:37.800 Hatch's right hand man. That mistaken could in an Orange 0:06:37.800 --> 0:06:41.240 Hatch function in today's Congress, or he'd be an outlier. 0:06:41.800 --> 0:06:44.839 You know, there's a couple couple I call statesmen left 0:06:44.880 --> 0:06:46.799 in the in the in the US and the US Congress, 0:06:47.120 --> 0:06:48.880 but they are a dying breed. And uh, I know, 0:06:48.960 --> 0:06:51.680 I'm so grateful to have been mentored by him. Um 0:06:51.800 --> 0:06:54.120 and I really our country would be much better off 0:06:54.120 --> 0:06:55.400 if we had more and more ore in hatches in 0:06:55.480 --> 0:06:57.840 the Senate today. Well, it's been awesome to have you 0:06:57.920 --> 0:06:59.360 in the studio and I hope we can get you 0:06:59.440 --> 0:07:03.960 back for more time. Chris Campbell, their chief strategist at Kroll, 0:07:04.080 --> 0:07:07.880 talking us through the bank. Well, we're not going to 0:07:07.920 --> 0:07:11.240 call it a crisis, right the bank. We camil is 0:07:11.280 --> 0:07:15.320 the word I think that we've landed on. You're listening 0:07:15.440 --> 0:07:19.200 to the Team Cancer Live program Bloomberg Markets weekdays at 0:07:19.240 --> 0:07:22.160 ten am Eastering on Bloomberg dot Com, the I Heart 0:07:22.240 --> 0:07:24.880 Radio app, and the Bloomberg Business app. We're listening on 0:07:24.960 --> 0:07:30.080 demand wherever you get your podcast. We have an opportunity 0:07:30.640 --> 0:07:33.640 to talk about steel right now at David Stickler. He's 0:07:33.680 --> 0:07:36.960 the CEO of High Bar. It's a newly formed company, 0:07:37.160 --> 0:07:39.840 comes with a lot of experience though as a CEO 0:07:40.120 --> 0:07:44.880 former CEO of Big River Steel, and he's in the 0:07:45.000 --> 0:07:46.600 studio with us right now. So I think it's a 0:07:46.640 --> 0:07:50.280 great opportunity to get a look at, you know, one 0:07:50.320 --> 0:07:56.320 of the underlying sort of signals of economic growth or 0:07:56.880 --> 0:08:00.280 you know, contraction. Thanks so much for joining us, David. 0:08:00.800 --> 0:08:03.880 What's the steel market like right now? Because it's obviously 0:08:04.000 --> 0:08:07.440 a primary building block of the economy. Sure, the steel 0:08:07.440 --> 0:08:10.800 market is if you look historically, it's in very very 0:08:10.880 --> 0:08:15.800 strong shape. It's been in strong shape for eighteen twenty 0:08:15.840 --> 0:08:20.240 four months now. But the steel market, when you talk steel, 0:08:20.760 --> 0:08:23.440 a lot of people look at just half of the equation. 0:08:23.560 --> 0:08:26.560 They look at what the steel price is. And today 0:08:27.520 --> 0:08:31.080 seventy percent of the steel in North America is made 0:08:31.240 --> 0:08:35.520 from recycled scrap metal, all right. Now, that's different where 0:08:35.559 --> 0:08:39.000 twenty years ago seventy percent was made from iron. Ore 0:08:39.160 --> 0:08:42.920 and coking coal. So there's been a huge, huge shift 0:08:43.920 --> 0:08:47.480 in the sustainability of steelmaking. But when you look at 0:08:47.520 --> 0:08:49.760 steel price, as I said a moment ago, that's just 0:08:49.920 --> 0:08:53.280 half the equation. It's what's the scrap metal price, And 0:08:53.440 --> 0:08:56.319 it's really the spread that everybody plays in, and that's 0:08:56.360 --> 0:08:59.520 where you make your money, the difference between scrap metal 0:09:00.080 --> 0:09:02.400 and steel. What are the benchmark contracts that you look 0:09:02.480 --> 0:09:06.079 at to find that price, So you you really in 0:09:06.200 --> 0:09:11.080 the steel industry, unlike the alunium industry or the oil 0:09:11.160 --> 0:09:14.760 industry or the gas industry, you don't have a liquid 0:09:14.880 --> 0:09:19.440 futures market. So you're really looking on a daily monthly 0:09:19.559 --> 0:09:24.120 basis on what the scrap price is trading at all, right, 0:09:24.160 --> 0:09:26.920 what you can buy scrap metal for, and then you're 0:09:27.040 --> 0:09:30.040 trying to add on your margin to set your steel price. 0:09:30.160 --> 0:09:35.520 And that's really gentleman. What's interesting, Manton John is with 0:09:35.679 --> 0:09:38.600 scrap metal, there's nothing else to do with it other 0:09:38.720 --> 0:09:42.080 than make new steel. But they have scrap metal overseas 0:09:43.040 --> 0:09:46.439 they do. And when I'm buying stuff like that, I 0:09:46.480 --> 0:09:49.520 would imagine as a purchaser, I'm just looking at, you know, 0:09:50.000 --> 0:09:53.079 who's the best producer, the best price I can get, 0:09:53.720 --> 0:09:55.920 And those are two different things, by the way, right, 0:09:56.160 --> 0:09:58.839 the best producer and the best price you can get 0:09:58.960 --> 0:10:02.120 are often too very different things. It's hugely different. Now 0:10:02.320 --> 0:10:06.520 you can buy steel. Steel isn't steel. Steel is not steel. 0:10:06.640 --> 0:10:10.000 You can buy steel from all the reaches of the 0:10:10.280 --> 0:10:12.400 globe pretty much. You can buy it from China, you 0:10:12.480 --> 0:10:17.280 can buy it from Russia, Brazil, India, Japan, Korea, Canada, 0:10:17.679 --> 0:10:22.880 the US and imported steel certainly is here and will 0:10:22.960 --> 0:10:28.960 always be here. The difference is the quality and more recently, 0:10:29.080 --> 0:10:33.760 the environmental sustainability. I will tell you the global average 0:10:34.440 --> 0:10:38.520 for carbon emissions per ton of steel. For each ton 0:10:38.600 --> 0:10:41.800 of steel, the world average is one point eight five 0:10:41.960 --> 0:10:45.199 tons of carbon. All right, one ton of steel one 0:10:45.240 --> 0:10:47.599 point eight five tons of carbon in the air. The 0:10:47.800 --> 0:10:51.280 last mill, prior to my high bar effort here, our 0:10:51.360 --> 0:10:55.640 carbon emissions was point one two three. But how would 0:10:55.679 --> 0:10:57.880 I know that as the consumer? I mean, does its 0:10:57.880 --> 0:11:02.080 stamped on the steel lumbered one way? By the way, David, 0:11:02.080 --> 0:11:05.439 you're not selling steel rebar to John for his home 0:11:05.520 --> 0:11:11.360 renovation projects. I've got You've got much bigger customers. These 0:11:11.400 --> 0:11:17.079 are bridge tunnel, airport projects, roadway projects, sixty seventy you know, 0:11:17.360 --> 0:11:20.840 floor office and condominium towers. And I've heard we are 0:11:20.840 --> 0:11:22.520 going to do a little bit of infrastructure spending in 0:11:22.520 --> 0:11:27.760 this control. We certainly are. And what's interesting, since the 0:11:27.880 --> 0:11:32.600 nineteen sixties, anytime there's been a federal highway dollar used 0:11:32.640 --> 0:11:36.400 in a project, there's a concept called buy America. The 0:11:36.480 --> 0:11:41.840 rebar has to be melted, cast enrolled in the United States, 0:11:42.040 --> 0:11:45.600 all right. Now, That's been around since the nineteen sixties. 0:11:45.679 --> 0:11:47.439 So when you talk about, hey, can I buy some 0:11:47.600 --> 0:11:50.920 rebar from Turkey, absolutely you can. But if it's a 0:11:51.000 --> 0:11:58.319 federal highway project, you're restricted only two US produced rebar 0:11:58.880 --> 0:12:02.240 And I guess you know, especially with this administration, they 0:12:02.320 --> 0:12:06.720 probably want to do a better job for the environment. 0:12:06.840 --> 0:12:10.520 We import as a country like thirty million metric tons 0:12:10.600 --> 0:12:15.679 of steel every year, but that is incredibly pollutive, right. 0:12:16.320 --> 0:12:19.400 I'll give you an example. So on the West Coast, 0:12:19.520 --> 0:12:22.880 there's really no natural home for scrap metal, so it 0:12:23.000 --> 0:12:27.679 either has to travel east into Chicago, into Arkansas, into 0:12:28.120 --> 0:12:30.960 the Carolinas where steel a lot of steels produced Texas 0:12:31.880 --> 0:12:34.600 or gets shipped overseas. So you take your scrap metal 0:12:34.880 --> 0:12:38.360 off your West coast ports, ship it over to Asia, 0:12:38.679 --> 0:12:40.360 gets put on a truck that you don't want to 0:12:40.520 --> 0:12:43.720 be anywhere near, driving behind with all of the pollution 0:12:43.760 --> 0:12:47.040 coming out of the tailpipe, gets melted in those steel mills. 0:12:47.120 --> 0:12:50.160 That as I said, one point eight five tons of carbon, 0:12:50.520 --> 0:12:53.320 you know, per ton of steel put on a truck, 0:12:53.520 --> 0:12:56.400 put on a ship delivered to the West coast. That 0:12:57.000 --> 0:13:02.120 is not an environmental fuel both ways is not environmentally sustainable. 0:13:02.160 --> 0:13:06.360 So so what will you do? You were at Big 0:13:06.520 --> 0:13:10.359 River Steel, now you're at High Bar. You're focused on recycling, 0:13:10.400 --> 0:13:12.560 in the in the production. What will you do differently 0:13:12.640 --> 0:13:15.600 than your competitors? Oh? Number one will be LEAD certified. 0:13:16.040 --> 0:13:19.720 At Big River we were the world's first LEADS certified 0:13:20.040 --> 0:13:26.160 scrap metal, recycling, steel production, facility leadership and environmental design 0:13:27.080 --> 0:13:33.760 and LEAD certification is typically for office buildings, hospital complexes, 0:13:33.920 --> 0:13:36.560 university building. We have it at the Bloomberg headquarters. When 0:13:36.640 --> 0:13:38.920 when people heard that we were going to get Big 0:13:39.040 --> 0:13:41.840 River Steel or attempt to get Big River Steel LEADS certified, 0:13:42.200 --> 0:13:44.439 they thought we had lost our minds. But we did it. 0:13:45.040 --> 0:13:47.640 And after two years of operation at Big River Steel, 0:13:48.320 --> 0:13:51.920 Dommler Mercedes called us up and said, Dave, are you 0:13:52.000 --> 0:13:54.200 going to be in town in three weeks. I said, 0:13:54.240 --> 0:13:56.120 well I am. They said, we want to give you 0:13:56.240 --> 0:14:00.240 our Environmental Supplier of the Year award, and not just 0:14:00.400 --> 0:14:04.920 for steel, not just in North America. Everything that Donler 0:14:05.040 --> 0:14:08.600 Mercedes buys plastic, glass, aluminum. Here's a two year old 0:14:08.640 --> 0:14:11.679 company at that point in time, given our lead certification, 0:14:11.960 --> 0:14:15.600 given our carbon footprint, and that really makes a difference. Now, 0:14:15.679 --> 0:14:18.160 what I will tell you is people don't pay more 0:14:18.240 --> 0:14:22.680 for our steel because it's environmentally sustainable, but everything else 0:14:22.720 --> 0:14:25.320 being equal, If my steel selling for a thousand bucks 0:14:25.360 --> 0:14:27.960 delivered in one of my competitors up along the Great 0:14:28.040 --> 0:14:31.800 Lakes that uses coal and iron ore to make steel 0:14:31.840 --> 0:14:34.480 selling for a thousand bucks, nine times out of ten 0:14:34.800 --> 0:14:37.000 will get the order. It's like a tiebreaker when you 0:14:37.080 --> 0:14:39.120 go to Vegas and the house has, you know, the 0:14:39.240 --> 0:14:43.640 blackjack tiebreaker. I'll take the tiebreaker. What's the future of 0:14:43.760 --> 0:14:47.360 the industry. Do you face competition from things like carbon fiber? 0:14:48.160 --> 0:14:51.120 You're always facing you replacement. You know, for a while 0:14:51.200 --> 0:14:53.400 it was going to be the cars are all going 0:14:53.440 --> 0:14:55.320 to be aluminum. The steel industry is going to be 0:14:55.400 --> 0:15:01.080 on its tail. Talk about an energy intensive deducing aluminum, yeah, 0:15:01.120 --> 0:15:06.720 can and energy intensive carbon intensive. You know, the one 0:15:06.800 --> 0:15:09.560 thing about aluminum is you do have you know, a 0:15:09.760 --> 0:15:13.560 high level of recycling. You're seeing a shift away from 0:15:14.120 --> 0:15:18.760 plastic bottles to now water and other drinks are being 0:15:19.240 --> 0:15:22.880 more and more in aluminum cans, aluminium bottles, what have you. So, 0:15:23.080 --> 0:15:25.680 the aluminum industry is here to stay. It's not going away. 0:15:25.800 --> 0:15:30.280 But to answer your question, the steel industry, the key 0:15:30.480 --> 0:15:36.240 is lightweight and strong. All right, lightweight and strong. And 0:15:36.440 --> 0:15:40.400 thirty years ago steel was you know, half inch thick. 0:15:40.680 --> 0:15:43.240 It was you know, you couldn't bend it, couldn't press it. 0:15:43.760 --> 0:15:47.000 It was tough for some of these applications, and aluminum 0:15:47.200 --> 0:15:52.080 and carbon fiber were quite frankly nipping it the tails 0:15:52.120 --> 0:15:54.800 of the steel industry. The steel industry, to their credit, 0:15:55.080 --> 0:15:59.920 has come out with advanced high strength steels, corrosion resists 0:16:00.120 --> 0:16:03.480 in steels, and really over the last twenty years has 0:16:04.120 --> 0:16:07.840 just done a complete life cycle change. When I first 0:16:07.840 --> 0:16:11.960 started this twenty years ago, steelmaking was eighty percent braun 0:16:12.560 --> 0:16:16.280 twenty percent brains. Today at High Bar and Big River 0:16:16.920 --> 0:16:21.040 it's ten percent braun ninety percent brains. We have this 0:16:22.440 --> 0:16:28.160 green market steel. Bloomberg Company Rebar report here available to 0:16:28.320 --> 0:16:33.640 our terminal customers. Is there do you think enough support 0:16:33.680 --> 0:16:37.480 for sustainability around this industry. I don't think you'll see 0:16:37.520 --> 0:16:40.240 a green premium. All right. There's a lot of people 0:16:40.280 --> 0:16:43.000 in the industry saying you're going to be sustainable, you'll 0:16:43.000 --> 0:16:45.520 be able to get an extra ten percent for your 0:16:45.560 --> 0:16:49.040 steel products. I don't believe that. What I believe it's 0:16:49.040 --> 0:16:52.560 a tiebreaker. If you're the most sustainable, you're going to 0:16:52.600 --> 0:16:55.240 get the order, everything else being equal. But I do 0:16:55.400 --> 0:16:58.840 not expect a developer or a builder to pay me 0:16:58.960 --> 0:17:01.920 a premium because my steal is green. All right, Well, 0:17:02.040 --> 0:17:04.920 we're gonna be hearing more from you at this roundtable 0:17:04.960 --> 0:17:07.720 discussion here at Bloomberg. So we're glad you could stop 0:17:07.760 --> 0:17:10.360 by the radio booth and talk to us because it's 0:17:10.520 --> 0:17:13.920 a fascinating topic and I think John and I love 0:17:13.920 --> 0:17:15.600 all the things that are made of steel. No, I'm 0:17:15.640 --> 0:17:18.760 in the market for rebar for my basement, So keep 0:17:18.800 --> 0:17:21.480 you in mind. Thank you very much, Thank thank you 0:17:21.600 --> 0:17:24.199 so much. You're listening to the tape. Ken's a our 0:17:24.280 --> 0:17:27.879 live program Bloomberg Markets weekdays at ten am Eastern on 0:17:28.040 --> 0:17:31.040 Bloomberg Radio, the tune in app, Bloomberg dot Com, and 0:17:31.160 --> 0:17:33.920 the Bloomberg Business app. You can also listen live on 0:17:34.000 --> 0:17:37.240 Amazon Alexa from our flagship New York station. Just say 0:17:37.320 --> 0:17:42.199 Alexa play Bloomberg eleven thirty. We want to get right 0:17:42.280 --> 0:17:47.200 now to James Lanthier. He's a CEO at Mindset Pharma 0:17:47.960 --> 0:17:52.520 and they have it's it's a business that I am 0:17:52.640 --> 0:17:58.200 very interested in psychedelics, plant based psychedelics to treat What 0:17:58.320 --> 0:18:00.760 do you treat James with these psycho delics other than 0:18:01.119 --> 0:18:05.440 you know, the duldrums? Well, you know, I think we're 0:18:05.440 --> 0:18:08.560 at a pretty fascinating point. There are a couple of 0:18:08.720 --> 0:18:12.800 clinical trials that are in their later stages. Um, for 0:18:13.520 --> 0:18:16.520 for the use of psilocybin, which is a psychoactive component 0:18:16.560 --> 0:18:21.720 of magic mushrooms rooms exactly three of resistant depression and 0:18:22.160 --> 0:18:27.320 m DMA to treat PTSD. But there are literally hundreds 0:18:27.520 --> 0:18:31.639 of clinical trials right now, and uh, you know, academic 0:18:31.720 --> 0:18:38.200 studies exploring different indications, you know, for psilocybin, DMT, a 0:18:38.280 --> 0:18:41.439 whole range of different psychedelics. You know. But you are 0:18:41.520 --> 0:18:44.399 actually so I'll just tell listeners, um, this is a 0:18:44.480 --> 0:18:50.200 publicly traded company, Mindset Pharma. The ticker is MSSTF. You 0:18:51.560 --> 0:18:56.560 actually sell like shrooms in ecstasy to clients in Canada. No, 0:18:56.960 --> 0:18:59.800 we're we're a classic biotech. So what we are doing 0:19:00.280 --> 0:19:05.000 is we are trying to develop new psychedelic drugs that 0:19:05.080 --> 0:19:08.040 have been really optimized to make up for some of 0:19:08.119 --> 0:19:10.680 the shortcomings of the of the known drugs, so that 0:19:10.720 --> 0:19:14.920 they're gonna work better as medicines. They'll be safer, more predictable, 0:19:15.280 --> 0:19:20.960 have potentially different durations. So better than like SSRIs the 0:19:21.080 --> 0:19:23.760 prozacts of the world is what you're saying. Well, better 0:19:23.920 --> 0:19:27.399 not only than the established therapies. Yeah, absolutely better than 0:19:27.440 --> 0:19:31.240 the SSRIs, but but better than the psychedelic drugs that 0:19:31.440 --> 0:19:36.080 we are you know, studying today. So you know, for instance, psilocybin, 0:19:36.160 --> 0:19:38.720 there's amazing data to show that it can do a 0:19:38.800 --> 0:19:41.760 really great job of helping people with uh, you know, 0:19:41.880 --> 0:19:45.359 different depressive disorders, but the durations really long. You have 0:19:45.480 --> 0:19:48.199 to spend you know, up to eight hours in clinic 0:19:48.320 --> 0:19:51.640 and be supervised by multiple therapists, and we just think 0:19:51.680 --> 0:19:54.399 that's not really a very convenient model for you know, 0:19:54.520 --> 0:19:57.399 either for therapists or you know, or for patients. So 0:19:57.520 --> 0:20:01.240 we're trying to you know, develop drugs that still you know, 0:20:01.400 --> 0:20:04.159 have the same benefit are still going to likely induce 0:20:04.240 --> 0:20:08.199 the same you know, psychedelic experience, but have a shorter duration. 0:20:08.440 --> 0:20:11.000 All right, since you mentioned startup, I got to ask 0:20:11.080 --> 0:20:15.920 the obligatory tangential question about funding and how svb's collapse 0:20:16.440 --> 0:20:21.240 may have affected you or your industry. Well, it hasn't 0:20:21.280 --> 0:20:24.640 affected mindset. We're in a bit of a unique position. 0:20:24.920 --> 0:20:28.959 We're the only biotech startup out there that actually has 0:20:29.000 --> 0:20:33.600 a big pharma collaboration. So we're we're partnered with the 0:20:33.720 --> 0:20:38.240 development arm of Otsuka Pharmaceuticals, which is a top psychia 0:20:38.520 --> 0:20:43.280 psychiatric drug company, and they fund the majority of our expenses. 0:20:43.600 --> 0:20:46.679 I think generally speaking, you know, the psychedelic space has 0:20:46.760 --> 0:20:50.840 not had a ton of exposure to SVB or you know, 0:20:51.000 --> 0:20:54.359 any of the other regional banks that have Why is 0:20:54.400 --> 0:20:58.120 it structured that way? The does big farma not want 0:20:58.160 --> 0:21:00.680 to touch this or they'd rather have somebody like you 0:21:00.800 --> 0:21:04.640 and if it is successful, take you over or whatever. Yeah, 0:21:04.840 --> 0:21:07.879 the I think it's it's it's really more of the latter, 0:21:08.160 --> 0:21:11.280 you know, we're most of the new drug work is 0:21:11.720 --> 0:21:13.800 is still at a kind of a pre clinical stage, 0:21:13.840 --> 0:21:15.920 which is just you know a little bit early for 0:21:16.080 --> 0:21:18.760 big pharma and so the way that you know a 0:21:18.840 --> 0:21:21.320 law you know, not only in psychedelics, but you know, 0:21:21.400 --> 0:21:23.760 a kind of a cross farma now have a lot 0:21:23.840 --> 0:21:27.840 of these, you know, early stage collaborations where pharma's uh, 0:21:27.960 --> 0:21:31.840 you know, partner up with promising biotechs that have you know, 0:21:32.119 --> 0:21:35.080 have some promising kind of early results before they actually 0:21:35.520 --> 0:21:41.280 you know, go all the way into a licensing partnership. So, um, 0:21:41.520 --> 0:21:44.760 what could what are you finding in terms of treatments 0:21:44.840 --> 0:21:48.480 because um, you know, you mentioned the psychedelic experience, and 0:21:48.560 --> 0:21:51.960 I thought the way people use sila cybin to treat 0:21:52.320 --> 0:21:57.639 um disorders was through micro dosing. At least that seems 0:21:57.680 --> 0:21:59.760 to be the kind of trendy way that people are 0:21:59.800 --> 0:22:02.800 doing it in Silicon Valley and some others here on 0:22:02.800 --> 0:22:05.880 the East Coast as well. Um, well, what's the most 0:22:05.920 --> 0:22:08.720 successful way that you're that you found so far? Yeah, 0:22:08.760 --> 0:22:11.399 I'm really glad you asked that question because it's actually 0:22:11.520 --> 0:22:14.400 a kind of a common misconception because you do hear 0:22:14.440 --> 0:22:18.560 a lot about microdosing, but but actually the the the 0:22:18.840 --> 0:22:22.640 approach that has had you know, the most positive data 0:22:22.720 --> 0:22:26.200 so far is what we call macrodosing. So you go 0:22:26.320 --> 0:22:28.520 into a clinic, you take a large dose of a 0:22:28.600 --> 0:22:31.840 psychedelic drug. You know, it puts you off into a 0:22:31.920 --> 0:22:36.399 real psychedelic trip for you know, a period of time. Um, 0:22:36.560 --> 0:22:38.320 and you've got to do it, you know, in clinic 0:22:38.480 --> 0:22:45.680 under supervision, typically with multiple therapists. Yeah. Yeah, Typically there's 0:22:45.760 --> 0:22:48.439 there's you know often there's music too, and and uh 0:22:48.760 --> 0:22:51.639 and it's really interesting. All the data suggests that, you 0:22:51.720 --> 0:22:56.000 know that that that profound psychedelic experience is really kind 0:22:56.040 --> 0:22:59.760 of essential to to getting you know, the relief from 0:23:00.600 --> 0:23:03.760 depressive symptoms. It's almost like a we still don't really 0:23:04.040 --> 0:23:07.200 fully understand like how this all works, but you know, 0:23:07.280 --> 0:23:09.639 the assumption is that there's some level of kind of 0:23:10.119 --> 0:23:12.760 rewiring and it helps, you know, helps give you kind 0:23:12.760 --> 0:23:15.920 of a break from being stuck in uh, in these 0:23:16.000 --> 0:23:19.119 negative thought patterns. That's you know, really a hallmark of 0:23:19.200 --> 0:23:21.959 people who are suffering, you know, badly from depression. How 0:23:22.040 --> 0:23:27.199 far are you from something prescribable? If you look across 0:23:27.280 --> 0:23:31.240 the psychedelic space, the drug that's going to get likely 0:23:31.359 --> 0:23:35.159 get to FDA approval first is going to be MDMA. Uh, 0:23:35.280 --> 0:23:37.600