1 00:00:09,880 --> 00:00:13,800 Speaker 1: Welcome to the Bloomberg Surveillance Podcast, and I'm Tom Keane Jailey. 2 00:00:13,960 --> 00:00:17,560 Speaker 1: We bring you insight from the best in economics, finance, investment, 3 00:00:18,000 --> 00:00:23,520 Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,600 --> 00:00:27,400 Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg Right now, 5 00:00:27,400 --> 00:00:30,480 Speaker 1: we're gonna get proportionately smarter. On a Tuesday, Mornamahangen joins 6 00:00:30,560 --> 00:00:33,760 Speaker 1: us from Alians here as we consider not so much 7 00:00:33,840 --> 00:00:38,000 Speaker 1: investment strategy, but the shock and awe of SMP three 8 00:00:38,040 --> 00:00:42,600 Speaker 1: thousand and doubt twenty five thousand, bona. It has been 9 00:00:42,640 --> 00:00:48,040 Speaker 1: an unloved bull market. How bull market? Is this or 10 00:00:48,120 --> 00:00:51,400 Speaker 1: is this a pause along the way along the struggles 11 00:00:51,400 --> 00:00:54,200 Speaker 1: of this pandemic? Yeah, you know, first of all, thanks 12 00:00:54,240 --> 00:00:56,640 Speaker 1: for having me. This is a great new format. Enjoying 13 00:00:56,640 --> 00:01:00,400 Speaker 1: it immensely. But certainly that three thousand level TOM on 14 00:01:00,440 --> 00:01:03,080 Speaker 1: the SMP is something that's not only psychological, but it 15 00:01:03,120 --> 00:01:05,520 Speaker 1: happens to be close to the two day moving average, 16 00:01:05,560 --> 00:01:08,399 Speaker 1: so it does have some technical significance that well as well. 17 00:01:09,040 --> 00:01:11,480 Speaker 1: We certainly think that if we can get through that, 18 00:01:11,520 --> 00:01:13,880 Speaker 1: breakthrough that and sustain that for at least, you know, 19 00:01:13,959 --> 00:01:17,360 Speaker 1: a few days, that is meaningful in terms of perhaps 20 00:01:18,120 --> 00:01:21,560 Speaker 1: moving some opinions over to more bullish stands. You know, 21 00:01:21,640 --> 00:01:25,200 Speaker 1: to us, clearly, this has been a bifurcated market. Um. 22 00:01:25,240 --> 00:01:28,320 Speaker 1: The winners and the SMP have been tech and healthcare 23 00:01:28,760 --> 00:01:32,600 Speaker 1: and the unloved cyclical sectors you know, energy, financial, industrials 24 00:01:32,640 --> 00:01:37,759 Speaker 1: all still down over still very much in bear market territory. Um. Really, 25 00:01:37,800 --> 00:01:40,440 Speaker 1: we think if if the market is a buyer of 26 00:01:40,480 --> 00:01:44,200 Speaker 1: this reopening story, we should start to see a broadening 27 00:01:44,319 --> 00:01:48,280 Speaker 1: of performance and that should include some of those cyclical sectors. Certainly, 28 00:01:48,320 --> 00:01:50,640 Speaker 1: we started to see that last week as well, with 29 00:01:50,720 --> 00:01:54,200 Speaker 1: industrials and energy at the top of the performance list. Um, 30 00:01:54,320 --> 00:01:56,960 Speaker 1: we think that trend could continue and help carry us 31 00:01:57,000 --> 00:02:01,240 Speaker 1: beyond the three thousand moves. Certainly, this morning we are 32 00:02:01,240 --> 00:02:04,480 Speaker 1: seeing a buying of the reopening narrative. What kind of 33 00:02:04,520 --> 00:02:08,200 Speaker 1: reopening our traders pricing in because there is the possibility 34 00:02:08,240 --> 00:02:11,040 Speaker 1: that you reopen and nobody shows up because they don't 35 00:02:11,080 --> 00:02:13,280 Speaker 1: have faith that they have the health controls in place 36 00:02:13,480 --> 00:02:17,160 Speaker 1: that they won't get sick. Yeah, now that's a fair point. 37 00:02:17,240 --> 00:02:20,079 Speaker 1: And look, as we're watching this reopening just like everyone else, 38 00:02:20,120 --> 00:02:22,480 Speaker 1: we're watching the health data alongside of it. You know, 39 00:02:22,520 --> 00:02:25,080 Speaker 1: one thing that's notable to us is that areas that 40 00:02:25,160 --> 00:02:27,359 Speaker 1: had been the epicenter of this crisis, like New York 41 00:02:27,400 --> 00:02:30,720 Speaker 1: and New Jersey, UM, really the pressure on their hospital 42 00:02:30,760 --> 00:02:33,120 Speaker 1: systems has alleviated quite a bit. And so I think 43 00:02:33,320 --> 00:02:35,520 Speaker 1: when we think about why we flatten this curve in 44 00:02:35,520 --> 00:02:37,840 Speaker 1: the first place, is so that we wouldn't pressure the 45 00:02:37,880 --> 00:02:41,120 Speaker 1: hospital systems. And some of the more southern states that 46 00:02:41,200 --> 00:02:43,200 Speaker 1: we are seeing a little bit more uptick in some 47 00:02:43,320 --> 00:02:46,720 Speaker 1: of the virus cases, UM, their hospital systems are generally 48 00:02:46,880 --> 00:02:51,120 Speaker 1: still underutilized, I CU beds, etcetera. So to us, you know, 49 00:02:51,160 --> 00:02:53,960 Speaker 1: in order to really think about re shutting the economy, 50 00:02:54,000 --> 00:02:56,040 Speaker 1: or at least reshutting parts of the economy, you need 51 00:02:56,080 --> 00:02:58,800 Speaker 1: to see pressure on that hospital system. So it's not 52 00:02:59,200 --> 00:03:02,440 Speaker 1: another point that we are watching. The other thing I'd 53 00:03:02,480 --> 00:03:04,959 Speaker 1: say briefly is just that when we think about investing 54 00:03:04,960 --> 00:03:08,399 Speaker 1: in the market broadly, you know, sadly, this crisis has 55 00:03:08,440 --> 00:03:13,960 Speaker 1: really impacted mom and pop businesses largely, you know, the restaurants, bars, gym's, etcetera. 56 00:03:14,400 --> 00:03:17,359 Speaker 1: The SMP five hundred, however, is you know, the five 57 00:03:17,440 --> 00:03:22,520 Speaker 1: hundred best capitalized, best balance sheets, biggest companies in the 58 00:03:22,600 --> 00:03:24,720 Speaker 1: U S economy, and so when you think about where 59 00:03:24,720 --> 00:03:27,840 Speaker 1: to put your money, perhaps that's relatively safer and it 60 00:03:27,919 --> 00:03:30,000 Speaker 1: could be a driver of of what we're seeing now 61 00:03:30,000 --> 00:03:31,880 Speaker 1: in the market as well. I got to lift the 62 00:03:31,919 --> 00:03:34,160 Speaker 1: lid on that SMP five hundred. You did that briefly 63 00:03:34,200 --> 00:03:35,720 Speaker 1: just moments ago and moment and I think that's the 64 00:03:35,720 --> 00:03:38,280 Speaker 1: big topic for so many people. On the one side, 65 00:03:38,320 --> 00:03:42,440 Speaker 1: we've got these crowding, stretched valuations in growth. Then on 66 00:03:42,480 --> 00:03:44,360 Speaker 1: the other side we've got the potential for the value 67 00:03:44,400 --> 00:03:47,680 Speaker 1: trap playing out over encyclicals. How do you draw distinction 68 00:03:47,720 --> 00:03:49,200 Speaker 1: between the two at the moment and make sure you're 69 00:03:49,200 --> 00:03:51,720 Speaker 1: in the right companies. Yeah, no, that's a great point, 70 00:03:51,720 --> 00:03:53,520 Speaker 1: and we get that question all the time. Look, I 71 00:03:53,600 --> 00:03:56,400 Speaker 1: think for a post COVID world, you need to be 72 00:03:56,440 --> 00:04:00,000 Speaker 1: involved with some of these technology, particularly on the software side, 73 00:04:00,160 --> 00:04:05,280 Speaker 1: that include areas like cybersecurity, cloud computing, the e gaming space, 74 00:04:05,360 --> 00:04:08,360 Speaker 1: you know, the whole complex around the zoom conferencing and 75 00:04:08,760 --> 00:04:11,480 Speaker 1: remote learning. Even um, it's not going to be a 76 00:04:11,480 --> 00:04:13,560 Speaker 1: one year story. It's going to be a three, five, 77 00:04:13,680 --> 00:04:16,599 Speaker 1: even ten year story down the road. Uh. Similarly, on 78 00:04:16,640 --> 00:04:18,919 Speaker 1: the healthcare side, which may not be that long of 79 00:04:18,920 --> 00:04:21,320 Speaker 1: a story, but still very important in the next probably 80 00:04:21,360 --> 00:04:24,640 Speaker 1: two to five years. So I think we continue to 81 00:04:24,680 --> 00:04:29,599 Speaker 1: see opportunities tactically there. So obviously it's harder to chase 82 00:04:29,720 --> 00:04:32,440 Speaker 1: at these levels, but when we do get the pull backs, 83 00:04:32,440 --> 00:04:35,400 Speaker 1: we've had some sideway sideways movements over the last few weeks. 84 00:04:35,560 --> 00:04:38,520 Speaker 1: There has been opportunities to get involved again. On the 85 00:04:38,560 --> 00:04:40,240 Speaker 1: other side, you know, we would be a little bit 86 00:04:40,279 --> 00:04:43,920 Speaker 1: more selective when we think about some of the industrials, energy, financials, 87 00:04:44,320 --> 00:04:46,680 Speaker 1: um there's only parts of the energy complex that are 88 00:04:46,720 --> 00:04:50,440 Speaker 1: interesting to us, you know, refiners for example, or even 89 00:04:50,520 --> 00:04:53,800 Speaker 1: renewable energy. On the industrial side, you know, we're we're 90 00:04:53,800 --> 00:04:55,920 Speaker 1: taking a look at airlines here. I think their risk 91 00:04:55,960 --> 00:04:59,039 Speaker 1: reward is interesting as well. When you think about limited 92 00:04:59,080 --> 00:05:02,120 Speaker 1: downside government it might be stepping in to help bail 93 00:05:02,120 --> 00:05:05,040 Speaker 1: out some of the companies and eventually we probably all 94 00:05:05,120 --> 00:05:08,840 Speaker 1: will you know, have to travel again. So selective parts 95 00:05:08,960 --> 00:05:11,520 Speaker 1: across both sides of the spectrum, we think makes sense. 96 00:05:11,880 --> 00:05:14,400 Speaker 1: I've got to pick up on that airlines. I'm sure 97 00:05:14,400 --> 00:05:16,200 Speaker 1: a lot of people set up a little bit when 98 00:05:16,200 --> 00:05:18,799 Speaker 1: you said that. I know you can't do single names, 99 00:05:18,839 --> 00:05:22,320 Speaker 1: but surely that's a really, really difficult decision mix when 100 00:05:22,360 --> 00:05:24,560 Speaker 1: you look at that sector at the moment, some of 101 00:05:24,560 --> 00:05:26,480 Speaker 1: these companies, I think it's fair to say, and I'm 102 00:05:26,480 --> 00:05:29,640 Speaker 1: not being extreme saying this, some of these companies won't exist, 103 00:05:29,680 --> 00:05:33,600 Speaker 1: will they. M Yeah, I certainly have to be careful 104 00:05:33,640 --> 00:05:36,920 Speaker 1: across the spectrum here. Um. You know, one of the 105 00:05:36,960 --> 00:05:39,920 Speaker 1: things about active management during the crisis, any crisis, but 106 00:05:40,000 --> 00:05:42,520 Speaker 1: certainly this one, is there will be winners and losers, 107 00:05:42,600 --> 00:05:45,240 Speaker 1: and the fundamental research will really matter. You need to 108 00:05:45,240 --> 00:05:47,720 Speaker 1: look at balance sheets. You know, in a sector like airlines, 109 00:05:47,760 --> 00:05:50,200 Speaker 1: you probably need to look at our the domestic internationally, 110 00:05:50,200 --> 00:05:51,880 Speaker 1: you need to look at what the routes are, etcetera, 111 00:05:51,960 --> 00:05:55,520 Speaker 1: etcetera UM. And you know, obviously that was one example 112 00:05:55,560 --> 00:05:57,720 Speaker 1: on how to play the recovery. There are other you know, 113 00:05:57,960 --> 00:06:01,960 Speaker 1: you look across hotels, gamings, that, etra, etcetera, UM, larger 114 00:06:01,960 --> 00:06:05,000 Speaker 1: industrials as well, and so I think there are certainly 115 00:06:06,440 --> 00:06:09,359 Speaker 1: ways to play it up. Mona, I'm not gonna buy it, Mona, 116 00:06:09,440 --> 00:06:12,040 Speaker 1: I'm not gonna buy it. This is the most barbelled 117 00:06:12,120 --> 00:06:15,520 Speaker 1: market we've ever had, with five or seven or ten 118 00:06:15,720 --> 00:06:20,000 Speaker 1: stocks leading the way. If I'm institutional investor here in 119 00:06:20,040 --> 00:06:22,480 Speaker 1: my ELPAE so far behind, I'm not going to get 120 00:06:22,520 --> 00:06:25,240 Speaker 1: paid my bonus. What do I do? Buy more Amazon, 121 00:06:25,600 --> 00:06:29,279 Speaker 1: buy more Apple. You know, it's interesting. I do think 122 00:06:29,400 --> 00:06:31,520 Speaker 1: you make a good point about performance catch up here. 123 00:06:31,560 --> 00:06:35,039 Speaker 1: You know, not many people got in at Marye and 124 00:06:35,080 --> 00:06:39,080 Speaker 1: have written this move higher, and so certainly you're going 125 00:06:39,120 --> 00:06:40,960 Speaker 1: to see a lot of that. I think the implications 126 00:06:40,960 --> 00:06:44,000 Speaker 1: of that are more that now when you do get 127 00:06:44,360 --> 00:06:47,240 Speaker 1: dips um, are they more likely to be bought or 128 00:06:47,240 --> 00:06:49,279 Speaker 1: they more likely to be sold? And I think given 129 00:06:49,320 --> 00:06:53,240 Speaker 1: the momentum behind the health the economy, um, and you know, 130 00:06:53,600 --> 00:06:56,000 Speaker 1: just the reopening broadly, I think we're going to see 131 00:06:56,000 --> 00:06:58,440 Speaker 1: a little bit more buying at this point. And so 132 00:06:58,480 --> 00:07:01,039 Speaker 1: I think that's important to recting eyes as well. You know, 133 00:07:01,120 --> 00:07:04,200 Speaker 1: so any opportunities you get, you know, if you can 134 00:07:04,279 --> 00:07:07,159 Speaker 1: position yourself tactically during those times, it will be important. 135 00:07:07,520 --> 00:07:09,400 Speaker 1: Now that being said, you know, this is a long 136 00:07:09,520 --> 00:07:12,720 Speaker 1: term game here. So um, you know, while we've had 137 00:07:12,880 --> 00:07:15,480 Speaker 1: a great thirty percent move, now do we expect another 138 00:07:15,520 --> 00:07:18,640 Speaker 1: thirty percent you know, in the next six or eight 139 00:07:18,680 --> 00:07:21,320 Speaker 1: week period or even the next quarter or two. Probably not. 140 00:07:21,480 --> 00:07:23,760 Speaker 1: So you're not going to get um, you know, the 141 00:07:23,920 --> 00:07:26,400 Speaker 1: quote unquote easy money once again. And so in that 142 00:07:26,440 --> 00:07:30,080 Speaker 1: scenario you will get some sideways movements, you will get 143 00:07:30,200 --> 00:07:32,160 Speaker 1: pull backs, you will even get those five or ten 144 00:07:32,200 --> 00:07:34,200 Speaker 1: percent corrections along the way, And so those are your 145 00:07:34,200 --> 00:07:39,559 Speaker 1: opportunities to get involved. Mono, what's the best hedge right now? Interesting? Yeah, 146 00:07:39,560 --> 00:07:41,800 Speaker 1: you know, I think we continue to like some of 147 00:07:41,800 --> 00:07:45,280 Speaker 1: those eventsive asset classes as hedges as well. So, um, 148 00:07:45,400 --> 00:07:48,840 Speaker 1: we're still buyers or believers in the gold story, the 149 00:07:48,920 --> 00:07:51,800 Speaker 1: US dollar. I think it's interesting still, you know, given 150 00:07:51,840 --> 00:07:54,080 Speaker 1: the economy is the the U S economy has been 151 00:07:54,160 --> 00:07:57,400 Speaker 1: the flight to safety asset class broadly. Um, treasuries are 152 00:07:57,440 --> 00:07:59,560 Speaker 1: are somewhat interesting as well, just given you know, the 153 00:07:59,600 --> 00:08:02,360 Speaker 1: support we're seeing from the Fed in the stimulus etcetera. 154 00:08:02,360 --> 00:08:04,440 Speaker 1: And so I think you know, people will flock to 155 00:08:04,640 --> 00:08:06,920 Speaker 1: treasures as a hedge as well. Still, so some of 156 00:08:06,960 --> 00:08:10,200 Speaker 1: those as the classes, certainly parts of the high high 157 00:08:10,280 --> 00:08:12,720 Speaker 1: quality investment grade bond market still makes sense to us 158 00:08:12,720 --> 00:08:14,680 Speaker 1: as well. Mon Of fantastic to catch up with you. 159 00:08:14,840 --> 00:08:16,040 Speaker 1: So I'm my best of the team. Well you might 160 00:08:16,160 --> 00:08:22,400 Speaker 1: want to thank you for that of the job was claims. 161 00:08:22,400 --> 00:08:25,560 Speaker 1: Of course, folks have been terrible. Yes, the vector is improving, 162 00:08:26,000 --> 00:08:29,960 Speaker 1: but Nevertheless, it is a labor economy in America that 163 00:08:30,160 --> 00:08:34,959 Speaker 1: is absolutely extraordinary. Lisa John and I said, Okay, we're 164 00:08:35,000 --> 00:08:37,640 Speaker 1: gonna do a simulcast and you could get you know, 165 00:08:37,800 --> 00:08:40,640 Speaker 1: Beyonce and his you know on our first show, or 166 00:08:40,960 --> 00:08:43,320 Speaker 1: you know someone like that, maybe the guy that invented 167 00:08:43,360 --> 00:08:47,200 Speaker 1: bed wars from Microsoft. And we said, wait, this is serious. 168 00:08:47,240 --> 00:08:51,000 Speaker 1: The labor economy is imploding. So let us speak to 169 00:08:51,080 --> 00:08:54,160 Speaker 1: the Secretary of Labor. He is, of course from one 170 00:08:54,200 --> 00:08:59,120 Speaker 1: of the great storied conservative families of America. Eugene Scalia 171 00:08:59,240 --> 00:09:02,800 Speaker 1: joins us. Now, Mr Secretary, thank you so much for 172 00:09:02,920 --> 00:09:06,679 Speaker 1: starting your day with us. I want you to explain 173 00:09:07,320 --> 00:09:11,800 Speaker 1: how the administration and particularly how your Cabinet office will 174 00:09:11,840 --> 00:09:17,120 Speaker 1: react to twenty unemployment. What can you do from a 175 00:09:17,280 --> 00:09:26,360 Speaker 1: regulation and institutional basis to protect the millions of Americans unemployed. Well, Tom, 176 00:09:26,400 --> 00:09:29,800 Speaker 1: it's good to join you. Thanks for having me, and um, 177 00:09:29,920 --> 00:09:34,920 Speaker 1: we have been acting on many different fronts to help 178 00:09:35,000 --> 00:09:39,120 Speaker 1: the actually tens of millions Americans who have been put 179 00:09:39,120 --> 00:09:41,120 Speaker 1: out a work over the last couple of months as 180 00:09:41,120 --> 00:09:45,640 Speaker 1: we've idled our economy. UM, as you know, the Cares 181 00:09:45,720 --> 00:09:49,400 Speaker 1: Act included a very substantial benefit for people out on 182 00:09:49,880 --> 00:09:53,400 Speaker 1: unemployment six dollars a week on top of what is 183 00:09:53,440 --> 00:09:56,000 Speaker 1: paid by the States. We've been working very closely with 184 00:09:56,120 --> 00:10:00,160 Speaker 1: the States UH to to get those payments out and 185 00:10:00,480 --> 00:10:03,720 Speaker 1: UH to help people during this challenging time. We've also 186 00:10:03,800 --> 00:10:09,160 Speaker 1: been administering the paid lead provisions that Congress enacted and 187 00:10:09,440 --> 00:10:11,920 Speaker 1: UH in a program that we don't administer here, but 188 00:10:12,200 --> 00:10:14,640 Speaker 1: I think it's been just invaluable to American workers right 189 00:10:14,640 --> 00:10:17,880 Speaker 1: now has been the Paycheck Protection Program. We estimate about 190 00:10:17,920 --> 00:10:21,480 Speaker 1: fifty million American workers have been kept on payroll through 191 00:10:21,520 --> 00:10:24,640 Speaker 1: that program. That said, Tom, you know we're we're pivoting 192 00:10:24,640 --> 00:10:29,040 Speaker 1: now right we're reopening. I was in Florida and Georgia 193 00:10:29,080 --> 00:10:32,400 Speaker 1: with the Vice President last week and and it was 194 00:10:32,480 --> 00:10:34,400 Speaker 1: encouraging to see. We saw more of that over the 195 00:10:34,440 --> 00:10:37,440 Speaker 1: weekend too. Secretary Scalleier, you've done a fantastic job over 196 00:10:37,440 --> 00:10:39,200 Speaker 1: the last several months of providing a lot of aid 197 00:10:39,480 --> 00:10:42,400 Speaker 1: to everyday Americans and companies as well down in Washington, 198 00:10:42,480 --> 00:10:44,920 Speaker 1: not just the Republican Party, working with Democrats as well. 199 00:10:45,200 --> 00:10:47,560 Speaker 1: I think we've all set down this program many times. 200 00:10:47,800 --> 00:10:50,160 Speaker 1: What we're trying to work out though, is what happens 201 00:10:50,360 --> 00:10:53,640 Speaker 1: after the reopening the help that you offered during the shutdown, 202 00:10:53,640 --> 00:10:56,280 Speaker 1: Will any of that be extended at some point over 203 00:10:56,320 --> 00:10:59,600 Speaker 1: the next several months. What's the current stance. Well, of course, 204 00:11:00,400 --> 00:11:05,120 Speaker 1: the paid leave program UH remains in place. UH. The 205 00:11:05,400 --> 00:11:07,840 Speaker 1: unemployment plus up that I mentioned in six dollars a 206 00:11:07,840 --> 00:11:12,080 Speaker 1: week is in place through the end of July and UM. 207 00:11:12,640 --> 00:11:15,599 Speaker 1: But as we focus on the reopening, the President is 208 00:11:15,640 --> 00:11:20,400 Speaker 1: also looking at things to get the economy UH started 209 00:11:20,400 --> 00:11:25,120 Speaker 1: again more broadly, not simply aid, but returning to that 210 00:11:25,240 --> 00:11:29,200 Speaker 1: incredibly vibrant economy that we had through through early March. 211 00:11:29,280 --> 00:11:33,160 Speaker 1: The President and I believe strongly that UH part of 212 00:11:33,160 --> 00:11:38,679 Speaker 1: what was key to that economy was lightening unnecessary regulatory 213 00:11:38,720 --> 00:11:40,760 Speaker 1: burdens on business. So you had the President last week 214 00:11:40,840 --> 00:11:44,679 Speaker 1: signing this new executive order urging agencies to look further 215 00:11:44,720 --> 00:11:48,319 Speaker 1: at ways that we can renew reduce unnecessary burdens on 216 00:11:48,440 --> 00:11:51,760 Speaker 1: business so we can get businesses reopen. It was by 217 00:11:51,800 --> 00:11:55,200 Speaker 1: having that vibrant business sector that we had that record 218 00:11:55,280 --> 00:11:59,600 Speaker 1: low unemployment through March. So that's something that we consider 219 00:11:59,679 --> 00:12:03,319 Speaker 1: a very important. Yes, we'll also look at what further 220 00:12:03,400 --> 00:12:06,240 Speaker 1: support may be needed, but that this situation has been 221 00:12:06,320 --> 00:12:10,760 Speaker 1: so fluid with the virus UH, and UH, you know, 222 00:12:11,080 --> 00:12:13,400 Speaker 1: I'd like to see how we progress into the month 223 00:12:13,440 --> 00:12:18,679 Speaker 1: of June before making decisions about what particular further measures 224 00:12:18,679 --> 00:12:22,400 Speaker 1: may be needed. Secretary, the market has largely priced in 225 00:12:22,440 --> 00:12:25,679 Speaker 1: an extension of those additional unemployment benefits that you were 226 00:12:25,679 --> 00:12:27,920 Speaker 1: talking about in the John Ray's and I'm just wondering 227 00:12:28,320 --> 00:12:30,840 Speaker 1: what metrics you're looking for that you will see in 228 00:12:30,960 --> 00:12:33,560 Speaker 1: June that will make you decide that they're either needed 229 00:12:33,679 --> 00:12:36,680 Speaker 1: as far as an extension goes, or not. Well. I 230 00:12:36,679 --> 00:12:42,400 Speaker 1: think the six plus up was a very important support 231 00:12:42,440 --> 00:12:45,320 Speaker 1: being given to American workers during a time that state 232 00:12:45,320 --> 00:12:48,640 Speaker 1: and local governments were shutting down businesses and UH and 233 00:12:48,800 --> 00:12:51,920 Speaker 1: telling people not to go to work. I don't see 234 00:12:52,240 --> 00:12:56,480 Speaker 1: UH continuing that program in its precise form going forward 235 00:12:56,600 --> 00:13:01,080 Speaker 1: from July. As we are reopening and now looking to 236 00:13:01,080 --> 00:13:04,440 Speaker 1: get people UH from the sidelines back into the workplace. 237 00:13:04,480 --> 00:13:07,719 Speaker 1: I think I think we'll be looking at different measures, UH, 238 00:13:07,880 --> 00:13:09,679 Speaker 1: at least in terms of the things I'll be looking at. 239 00:13:10,000 --> 00:13:13,880 Speaker 1: Of greatest interest will be simply how quickly we put 240 00:13:13,880 --> 00:13:16,360 Speaker 1: people back to work as we reopen. We know that 241 00:13:16,480 --> 00:13:19,800 Speaker 1: millions of people are starting to return to work now, UH, 242 00:13:19,800 --> 00:13:22,040 Speaker 1: and we'll be getting. I think more insights into that 243 00:13:22,080 --> 00:13:25,520 Speaker 1: in the coming weeks, Mr Secretary. The minimum wage is 244 00:13:25,600 --> 00:13:29,480 Speaker 1: delivering my food to my house, and the elites are 245 00:13:29,520 --> 00:13:33,360 Speaker 1: doing fine. I would say, as a generalization, I drove 246 00:13:33,360 --> 00:13:37,320 Speaker 1: down Columbus Avenue this weekend in Manhattan and it looked 247 00:13:37,320 --> 00:13:40,400 Speaker 1: like one of those movies with Bruce Willison. It was 248 00:13:40,480 --> 00:13:45,760 Speaker 1: so destitute Armageddon, Like, what is your administration gonna do 249 00:13:46,320 --> 00:13:50,440 Speaker 1: to get labor to get its fair share back in 250 00:13:50,480 --> 00:13:55,920 Speaker 1: a spirited, open American economy. What's the strategy to stop 251 00:13:55,960 --> 00:14:01,040 Speaker 1: the fifty year atomization of labor? Well all, I think 252 00:14:01,080 --> 00:14:03,840 Speaker 1: before the virus struck, one of the really remarkable things 253 00:14:03,880 --> 00:14:07,680 Speaker 1: about President Trump's economy was how well people lower end 254 00:14:07,760 --> 00:14:11,560 Speaker 1: of the pay scale we're doing. You uh, saw the 255 00:14:11,559 --> 00:14:15,880 Speaker 1: wages rising generally, but wages were rising more quickly for 256 00:14:16,160 --> 00:14:19,680 Speaker 1: people in the lowest ten percent of the income scale, 257 00:14:19,760 --> 00:14:23,080 Speaker 1: for people who didn't have a high school degree. We 258 00:14:23,160 --> 00:14:26,920 Speaker 1: had a record low unemployment for seminarity groups who historically 259 00:14:26,920 --> 00:14:29,640 Speaker 1: had been disadvantaged in the marketplace. So, you know, in 260 00:14:29,680 --> 00:14:32,480 Speaker 1: all seriousness, when I look at what will be most 261 00:14:32,520 --> 00:14:35,360 Speaker 1: important going forward, the single most important thing we can 262 00:14:35,400 --> 00:14:39,640 Speaker 1: do for American workers, particularly those at the lower end 263 00:14:39,640 --> 00:14:42,760 Speaker 1: of the pay scale is returned to the kind of 264 00:14:42,960 --> 00:14:46,560 Speaker 1: vibrant economy that we had uh just just two months ago, 265 00:14:47,000 --> 00:14:49,640 Speaker 1: and that was an economy driven in substantial part by 266 00:14:50,280 --> 00:14:54,560 Speaker 1: a reasonable tax burden and by reducing unnecessary regulatory burden. 267 00:14:54,680 --> 00:14:57,880 Speaker 1: So those will remain areas of focus, even as we 268 00:14:57,960 --> 00:15:00,400 Speaker 1: also assess whether we are going to need to continue 269 00:15:00,480 --> 00:15:04,880 Speaker 1: some forms of additional support, for example, for small businesses 270 00:15:04,920 --> 00:15:07,400 Speaker 1: and for some workers. I think a lot of people 271 00:15:07,400 --> 00:15:09,840 Speaker 1: have still going to need a lot of help, Mr Secretary, 272 00:15:09,880 --> 00:15:11,160 Speaker 1: I look forward to going to be back soon so 273 00:15:11,160 --> 00:15:12,800 Speaker 1: we can talk about doing just that. Because there's some 274 00:15:12,880 --> 00:15:16,400 Speaker 1: real agency even as we reopened this economy, Secretary Scalia, 275 00:15:16,480 --> 00:15:22,320 Speaker 1: that of the United States, the Labor Secretary. So we 276 00:15:22,400 --> 00:15:26,240 Speaker 1: spoke to the Secretary of Labor, Mr Scalia. We thought 277 00:15:26,320 --> 00:15:28,720 Speaker 1: we would speak to a gentleman who had the FED 278 00:15:28,800 --> 00:15:32,280 Speaker 1: more than anyone in the last twenty years, his stead 279 00:15:32,360 --> 00:15:36,920 Speaker 1: steadfastly on regulation and the operation of business. That is 280 00:15:37,040 --> 00:15:39,800 Speaker 1: Mr Trulo now at Harvard Law, and of course the 281 00:15:39,840 --> 00:15:43,760 Speaker 1: former governor of the Fellow Reserve System. Wonderful to have 282 00:15:43,840 --> 00:15:47,480 Speaker 1: you with us, Professor at today. I was talking to 283 00:15:47,520 --> 00:15:52,840 Speaker 1: the Secretary of Labor about the atomization of the labor economy. 284 00:15:53,360 --> 00:15:59,920 Speaker 1: Now we're gonna atomize it estimated twenty three or unemployment rate. 285 00:16:00,520 --> 00:16:04,440 Speaker 1: What will be the societal reaction. Well, I don't know 286 00:16:04,480 --> 00:16:07,720 Speaker 1: what the public reaction will be, but I think as 287 00:16:07,760 --> 00:16:11,880 Speaker 1: a macroeconomic matter, and and certainly just as a human matter, 288 00:16:12,360 --> 00:16:16,960 Speaker 1: taking measures now to ensure that there is income support 289 00:16:17,200 --> 00:16:19,920 Speaker 1: for the millions and millions of people who are going 290 00:16:20,000 --> 00:16:23,200 Speaker 1: to remain unemployed for quite some time to come ought 291 00:16:23,240 --> 00:16:26,920 Speaker 1: to be the country's highest priority right now. And I'm 292 00:16:26,960 --> 00:16:29,760 Speaker 1: a bit concerned that people are are more than a 293 00:16:29,760 --> 00:16:32,520 Speaker 1: bit concerned that so many people are taking what they 294 00:16:32,560 --> 00:16:35,480 Speaker 1: see is a wait and see attitude. I mean, looks, 295 00:16:35,600 --> 00:16:38,680 Speaker 1: as you just said, unemployment is likely to be reported 296 00:16:38,680 --> 00:16:42,960 Speaker 1: in the vicinity of Remember eleven years ago, during the 297 00:16:43,000 --> 00:16:46,440 Speaker 1: Great Financial Crisis, we were scrambling to try to do 298 00:16:46,560 --> 00:16:50,200 Speaker 1: something a lot about ten percent unemployment. So even if 299 00:16:50,240 --> 00:16:53,880 Speaker 1: you postulate a having of what the current rate probably is, 300 00:16:54,240 --> 00:16:57,960 Speaker 1: would still be in a very serious position relative to 301 00:16:58,000 --> 00:17:01,240 Speaker 1: the postwar econmy so, I think any in this notion 302 00:17:01,280 --> 00:17:04,200 Speaker 1: of delaying and seeing whether we need to do more 303 00:17:04,720 --> 00:17:08,480 Speaker 1: is really quite a bad mistake. Well, Dan, you touched 304 00:17:08,480 --> 00:17:10,160 Speaker 1: on the other floor as well. It's not just about 305 00:17:10,200 --> 00:17:12,680 Speaker 1: the timing, it's the composition of the next response. You're 306 00:17:12,680 --> 00:17:16,480 Speaker 1: talking about a demand side effort the administration increasingly whenever 307 00:17:16,520 --> 00:17:17,960 Speaker 1: I listened to them, whenever I get the chance to 308 00:17:18,000 --> 00:17:20,680 Speaker 1: speak to them, a talking about a supply side response 309 00:17:20,720 --> 00:17:23,200 Speaker 1: to how this economy reopen and get people back to work. 310 00:17:23,560 --> 00:17:25,920 Speaker 1: What are the limitations of that down? Well, I think 311 00:17:26,240 --> 00:17:31,200 Speaker 1: you don't think, Jonathan. We all recognize that this problem 312 00:17:31,240 --> 00:17:34,880 Speaker 1: has been driven by epidemiology. It hasn't been driven by 313 00:17:35,200 --> 00:17:37,720 Speaker 1: they're fed stepping on the branch too hard. It hasn't 314 00:17:37,760 --> 00:17:42,600 Speaker 1: been driven by excessive credit, although that's probably exacerbated things. 315 00:17:42,840 --> 00:17:46,560 Speaker 1: It's been driven by the epidemiology. And so getting people 316 00:17:46,680 --> 00:17:51,960 Speaker 1: back to work is dependent upon the medical developments, not 317 00:17:52,160 --> 00:17:56,879 Speaker 1: strictly speaking economic development. We can provide income support, but 318 00:17:57,240 --> 00:18:00,479 Speaker 1: we cannot just through economic measures, make it safe for 319 00:18:00,520 --> 00:18:03,760 Speaker 1: people to go out. We can't make people comfortable about 320 00:18:03,800 --> 00:18:06,160 Speaker 1: going out. And I think what that means is we've 321 00:18:06,200 --> 00:18:09,200 Speaker 1: got an enormous amount of uncertainty that's probably going to 322 00:18:09,280 --> 00:18:11,520 Speaker 1: be with us for some time. I mean, you folks 323 00:18:11,520 --> 00:18:15,199 Speaker 1: on Bloomberg have been reporting on the enormous volatility and 324 00:18:15,280 --> 00:18:18,080 Speaker 1: markets over the last couple of months. We get good 325 00:18:18,080 --> 00:18:22,879 Speaker 1: news on on the medical front, and everything goes up. 326 00:18:22,960 --> 00:18:25,600 Speaker 1: You get some bad news, everything goes down. I think 327 00:18:25,640 --> 00:18:28,240 Speaker 1: that just reflects the fact that we just don't know, 328 00:18:28,680 --> 00:18:33,200 Speaker 1: and we ought to care for the possibility that things 329 00:18:33,200 --> 00:18:36,640 Speaker 1: are going to be quite difficult quite some time. Dan. 330 00:18:36,800 --> 00:18:39,040 Speaker 1: And to this point, this this sort of volatility that 331 00:18:39,080 --> 00:18:41,479 Speaker 1: we saw in markets has basically gone away to a 332 00:18:41,480 --> 00:18:44,199 Speaker 1: certain degree, in part due to what the Federal Reserve 333 00:18:44,280 --> 00:18:46,760 Speaker 1: has done in terms of monetizing the debt of the 334 00:18:46,800 --> 00:18:50,960 Speaker 1: United States. What's the risk for financial stability going forward, 335 00:18:51,119 --> 00:18:54,359 Speaker 1: given how much debt the US is incurring, given how 336 00:18:54,400 --> 00:18:59,040 Speaker 1: much the feed is interfering and pushing investors further into risk. Well, 337 00:18:59,320 --> 00:19:02,760 Speaker 1: I think, you know, we we do need to acknowledge 338 00:19:03,160 --> 00:19:06,680 Speaker 1: that there are going to be some risks in when 339 00:19:06,720 --> 00:19:11,000 Speaker 1: everyone takes the range of fiscal and monetary measures that 340 00:19:11,040 --> 00:19:13,679 Speaker 1: have been taken. But I think we need to quickly 341 00:19:13,800 --> 00:19:18,720 Speaker 1: qualify that observation by saying it is absolutely necessary to 342 00:19:18,840 --> 00:19:23,160 Speaker 1: do whatever we can to stop what is a very 343 00:19:23,200 --> 00:19:27,879 Speaker 1: serious situation from being a chronic, highly depressed situation. In 344 00:19:27,920 --> 00:19:30,840 Speaker 1: other words, we're going to have to take some risks 345 00:19:31,040 --> 00:19:35,960 Speaker 1: with respect to debt levels of respect to financial stability 346 00:19:36,240 --> 00:19:39,600 Speaker 1: in order to stop this thing from getting worse and 347 00:19:39,800 --> 00:19:43,400 Speaker 1: staying at a at a low level. Having said that, 348 00:19:43,520 --> 00:19:48,160 Speaker 1: you know, I think again we do need to recognize that, uh, 349 00:19:48,200 --> 00:19:51,040 Speaker 1: there were some vulnerabilities. There were some vulnerabilities in the 350 00:19:51,080 --> 00:19:55,440 Speaker 1: commercial paper market. There were some vulnerabilities in the repo market. Uh. 351 00:19:55,600 --> 00:19:58,080 Speaker 1: And to return to the theme that that Jonathan was 352 00:19:58,119 --> 00:20:00,920 Speaker 1: asking me about a moment ago. You know, if we're 353 00:20:01,119 --> 00:20:05,520 Speaker 1: in a situation in which the FED will provide assistance 354 00:20:05,560 --> 00:20:10,399 Speaker 1: to large asset managers because they have exchange traded funds 355 00:20:10,480 --> 00:20:15,399 Speaker 1: with relatively illiquid assets, why why are we hesitating to 356 00:20:15,440 --> 00:20:19,280 Speaker 1: provide assistance to middle and lower middle income people who 357 00:20:19,280 --> 00:20:21,000 Speaker 1: are probably going to be out of many of whom 358 00:20:21,000 --> 00:20:22,520 Speaker 1: are going to be out of work for a long 359 00:20:22,560 --> 00:20:26,040 Speaker 1: time to come. So, yes, there are there are risks, 360 00:20:26,080 --> 00:20:28,320 Speaker 1: but I don't think we need to we should be 361 00:20:28,359 --> 00:20:31,520 Speaker 1: paralyzed by the risks. We've got to act to try 362 00:20:31,640 --> 00:20:35,560 Speaker 1: to people floor under income of floor under the economy, 363 00:20:35,880 --> 00:20:40,879 Speaker 1: and then as the medical developments permit, to start taking 364 00:20:40,920 --> 00:20:45,359 Speaker 1: measures actively to build it up again. Right, Governor, have 365 00:20:45,440 --> 00:20:47,960 Speaker 1: got one final question. I remember the day you joined 366 00:20:48,000 --> 00:20:51,560 Speaker 1: the FED and the entire market community stood up and said, 367 00:20:51,560 --> 00:20:54,200 Speaker 1: who is this guy? Why is he on the FED? 368 00:20:54,840 --> 00:20:58,040 Speaker 1: They said the same thing about Chairman Powell. How's the 369 00:20:58,119 --> 00:21:03,160 Speaker 1: chairman doing well? Look j J the Jed Powell has 370 00:21:03,240 --> 00:21:08,000 Speaker 1: confronted a challenge that only Ben Bernankie really has confronted. 371 00:21:08,040 --> 00:21:13,080 Speaker 1: The two very different kinds of challenges. Uh Ben's challenge 372 00:21:13,440 --> 00:21:19,200 Speaker 1: was originating in financial markets, and everything was imploding because 373 00:21:19,240 --> 00:21:23,560 Speaker 1: of the vulnerabilities in markets and in vans. Jara Powell 374 00:21:23,720 --> 00:21:27,200 Speaker 1: is facing a situation in which an anxiety, an external 375 00:21:27,240 --> 00:21:31,679 Speaker 1: shock has created an unprecedented situation, and you know he 376 00:21:31,800 --> 00:21:35,320 Speaker 1: moved very quickly, I think to push the FED to 377 00:21:36,280 --> 00:21:39,440 Speaker 1: get in place a set of emergency programs. I think 378 00:21:39,440 --> 00:21:42,280 Speaker 1: he's made it clear that the Fed will do what 379 00:21:42,440 --> 00:21:45,680 Speaker 1: they believe needs to be done. But I'm sure he'd 380 00:21:45,680 --> 00:21:47,600 Speaker 1: be the first to say it's got a lot of 381 00:21:47,640 --> 00:21:49,640 Speaker 1: work ahead of us. Down. I don't want to cause 382 00:21:49,680 --> 00:21:52,280 Speaker 1: any trouble between you and your friend Jay, but I 383 00:21:52,320 --> 00:21:54,600 Speaker 1: didn't want to when he first took the job at 384 00:21:54,600 --> 00:21:56,919 Speaker 1: the top of the Federal Reserve, and there was a 385 00:21:56,920 --> 00:21:58,879 Speaker 1: side of him where he wanted to play almost the 386 00:21:58,920 --> 00:22:01,239 Speaker 1: hard guy with financial markets, the guy that was going 387 00:22:01,280 --> 00:22:03,080 Speaker 1: to run the FED and not respond to where the 388 00:22:03,200 --> 00:22:07,359 Speaker 1: SPX was, the SMP five was on any given day. 389 00:22:07,880 --> 00:22:09,640 Speaker 1: Is there a part of you down that just feels, 390 00:22:09,680 --> 00:22:12,439 Speaker 1: now that the Federal Reserve is completely capitulated, that the 391 00:22:12,480 --> 00:22:16,199 Speaker 1: one mandate seems to be financial conditions. That is the 392 00:22:16,280 --> 00:22:20,359 Speaker 1: exclusive channel which monety policy flows through, and therefore that 393 00:22:20,480 --> 00:22:23,200 Speaker 1: is the only thing that matters right now. I don't 394 00:22:23,200 --> 00:22:27,120 Speaker 1: think it. I don't think it's the only thing that matters. Um. Look, 395 00:22:27,160 --> 00:22:32,600 Speaker 1: I think over a longish period of time there has 396 00:22:32,840 --> 00:22:37,320 Speaker 1: been more focused on markets by all people at the FED, 397 00:22:37,920 --> 00:22:43,080 Speaker 1: and perhaps some oversensitivity to markets. Having said that, though, 398 00:22:43,680 --> 00:22:47,120 Speaker 1: to the degree that what happens in markets then has 399 00:22:47,160 --> 00:22:51,040 Speaker 1: an impact on the real economy, it would be unwise 400 00:22:51,160 --> 00:22:54,560 Speaker 1: to ignore what is going on in markets. Um. And 401 00:22:54,600 --> 00:22:57,040 Speaker 1: I think what you've seen actually in the last week 402 00:22:57,119 --> 00:22:59,840 Speaker 1: or so is just a little bit of pushback by 403 00:22:59,840 --> 00:23:03,040 Speaker 1: the FED against that. I mean, both Vice Chair Clarida 404 00:23:03,240 --> 00:23:07,320 Speaker 1: and President Williams the New York Fed, we're out last 405 00:23:07,440 --> 00:23:12,200 Speaker 1: week making pretty clear that despite the requests or demands 406 00:23:12,240 --> 00:23:16,800 Speaker 1: of markets for some more explicit forward guidance right now, 407 00:23:17,240 --> 00:23:19,960 Speaker 1: that the FED was going to hold back and think 408 00:23:20,080 --> 00:23:23,560 Speaker 1: a while longer about what it's going to say about 409 00:23:23,600 --> 00:23:28,320 Speaker 1: monetary policy going for I don't know Jonathan that that 410 00:23:28,400 --> 00:23:33,199 Speaker 1: that's directly and responsively concerned that that you articulated, but 411 00:23:33,280 --> 00:23:36,760 Speaker 1: it's at least consistent with trying to push back Dan. 412 00:23:36,800 --> 00:23:39,639 Speaker 1: How concerned are you about the Federal Reserve providing a 413 00:23:39,680 --> 00:23:43,240 Speaker 1: backstop to companies that otherwise would be going bankrupt? In 414 00:23:43,240 --> 00:23:46,679 Speaker 1: other words, they're offering a liquidity solution, but increasingly the 415 00:23:46,720 --> 00:23:50,280 Speaker 1: problem is becoming a solvency one, and the Fed increasingly 416 00:23:50,760 --> 00:23:53,080 Speaker 1: is being expected or priced in, at least by the market, 417 00:23:53,680 --> 00:23:56,199 Speaker 1: as being willing to step in. Do you think that 418 00:23:56,200 --> 00:23:59,040 Speaker 1: that's realistic and do you think that they should? Well, 419 00:23:59,119 --> 00:24:05,199 Speaker 1: two things on any any economic um agency part of 420 00:24:05,200 --> 00:24:08,159 Speaker 1: the government that is trying to respond in an emergency 421 00:24:08,240 --> 00:24:13,119 Speaker 1: situation is based with the problem that on the one hand, 422 00:24:13,520 --> 00:24:16,200 Speaker 1: there's an imperative to get money out the door quickly, 423 00:24:16,640 --> 00:24:18,920 Speaker 1: and on the other hand, they know they'll be second 424 00:24:18,960 --> 00:24:23,920 Speaker 1: guests in retrospect if any of that money has landed 425 00:24:23,920 --> 00:24:26,879 Speaker 1: in a place whereupon consideration, you wouldn't have wanted it 426 00:24:26,920 --> 00:24:31,119 Speaker 1: to land. So I think that, uh, you've got to 427 00:24:31,200 --> 00:24:36,440 Speaker 1: expect a certain amount of under shooting and over shooting. 428 00:24:36,440 --> 00:24:39,480 Speaker 1: With any program like this, you try to shape the 429 00:24:39,520 --> 00:24:42,800 Speaker 1: program quickly as best you can to direct it where 430 00:24:42,840 --> 00:24:44,840 Speaker 1: you want to direct it. But you have to have 431 00:24:44,880 --> 00:24:48,520 Speaker 1: to understand that you're not going to have accuracy when 432 00:24:48,520 --> 00:24:51,760 Speaker 1: you're trying to do things on the plot um. That's 433 00:24:51,800 --> 00:24:56,280 Speaker 1: that's number one. Number two that I think after after 434 00:24:56,520 --> 00:25:01,439 Speaker 1: the um economy has improved, I think everybody needs to 435 00:25:01,720 --> 00:25:05,680 Speaker 1: step back and once again ask the question, what is 436 00:25:05,720 --> 00:25:08,760 Speaker 1: the nature of the financial system, What have we done 437 00:25:08,800 --> 00:25:11,400 Speaker 1: well and what have we not done well. I think 438 00:25:11,720 --> 00:25:14,840 Speaker 1: the performance of the banks over the last couple of 439 00:25:14,880 --> 00:25:19,639 Speaker 1: months has suggested that the Dodd Frank Act and the 440 00:25:19,680 --> 00:25:23,600 Speaker 1: reforms that were made thereafter did indeed strengthen the facts. 441 00:25:23,960 --> 00:25:26,080 Speaker 1: The banks have been a source of strength, not a 442 00:25:26,200 --> 00:25:29,880 Speaker 1: vulnerability this time around, and I hope they remain that way, 443 00:25:29,880 --> 00:25:33,440 Speaker 1: and that's a good thing. It's in shadow banking, it's 444 00:25:33,480 --> 00:25:37,360 Speaker 1: in other parts of financial markets, asset managers, hedge funds, 445 00:25:38,000 --> 00:25:41,919 Speaker 1: the repo market. That's where we've seen from vulnerabilities, and 446 00:25:42,000 --> 00:25:45,960 Speaker 1: that's where the FED action uh in an effort to 447 00:25:46,040 --> 00:25:50,840 Speaker 1: stabilize the economy needs to be looked at after the fact. 448 00:25:50,960 --> 00:25:54,400 Speaker 1: Not to criticize the FED for maybe acting to put 449 00:25:54,400 --> 00:25:58,240 Speaker 1: a floor under financial markets, to ask the question, just 450 00:25:58,400 --> 00:26:00,480 Speaker 1: as we did with the banks and two thousand and 451 00:26:00,560 --> 00:26:03,080 Speaker 1: nine and ten, what do we need to do now 452 00:26:03,400 --> 00:26:07,560 Speaker 1: in other markets to make sure that financial instability doesn't 453 00:26:07,600 --> 00:26:12,800 Speaker 1: grow outside the regulative Always thoughtful, Always appreciate your time. 454 00:26:12,800 --> 00:26:14,800 Speaker 1: I've gotta get you back on soon, form a fed governor. 455 00:26:14,880 --> 00:26:20,960 Speaker 1: That dance and real life, Well, you know, John, we 456 00:26:21,080 --> 00:26:23,399 Speaker 1: like to do it here on television on radio, and 457 00:26:23,400 --> 00:26:27,720 Speaker 1: that is cross asset data checks. But for so much 458 00:26:27,760 --> 00:26:30,200 Speaker 1: of America, for so much of the world, it's still 459 00:26:30,240 --> 00:26:33,920 Speaker 1: about the stock market. It can be that port Portico 460 00:26:34,040 --> 00:26:36,760 Speaker 1: whatever it is, a platform at the New York Stock Exchange, 461 00:26:36,920 --> 00:26:41,359 Speaker 1: or it can be the seven story video extravaganza of 462 00:26:41,400 --> 00:26:45,000 Speaker 1: the NASDACK. Going I p O and going public is 463 00:26:45,000 --> 00:26:47,840 Speaker 1: a good and beautiful thing. Nelson Griggs joins us. He 464 00:26:48,000 --> 00:26:51,240 Speaker 1: is the president of the NASDACK. Now, so let me 465 00:26:51,280 --> 00:26:54,359 Speaker 1: ask the money question right now for New York Wall Street, 466 00:26:54,680 --> 00:27:00,280 Speaker 1: How will those pandemic change your NASDACK. Well, it's just 467 00:27:00,400 --> 00:27:03,720 Speaker 1: quite a bit. We went from having four percent of 468 00:27:03,720 --> 00:27:07,119 Speaker 1: our population working from home to in a matter of 469 00:27:07,920 --> 00:27:10,880 Speaker 1: a week, and that was pretty remarkable. And I think 470 00:27:10,920 --> 00:27:13,960 Speaker 1: we have seen the markets work very efficiently and effectively. 471 00:27:14,359 --> 00:27:17,080 Speaker 1: There's certainly been an impact on I think you're leading 472 00:27:17,160 --> 00:27:18,879 Speaker 1: there to the I p O market, So happy to 473 00:27:18,960 --> 00:27:23,199 Speaker 1: discuss that. But we've been work working pretty well well. Now, 474 00:27:23,240 --> 00:27:25,919 Speaker 1: So let's talk about physical trading flaws. Just touch on 475 00:27:25,920 --> 00:27:27,960 Speaker 1: that topic and we can move on pretty quickly. But 476 00:27:28,040 --> 00:27:30,159 Speaker 1: you think the pandemic has on the line that we 477 00:27:30,200 --> 00:27:33,400 Speaker 1: don't need them anymore. Yeah. I think if you look 478 00:27:33,440 --> 00:27:36,080 Speaker 1: at the equities that have a pretty simple price action 479 00:27:36,400 --> 00:27:39,200 Speaker 1: up or down, we have a long believe that the 480 00:27:39,280 --> 00:27:42,880 Speaker 1: best outcome for investors is to do that in electronic format. 481 00:27:43,359 --> 00:27:45,240 Speaker 1: I think these last two months, the data that we 482 00:27:45,320 --> 00:27:49,040 Speaker 1: see now how stocks open, the efficiently, training throughout the 483 00:27:49,119 --> 00:27:52,440 Speaker 1: day and in particularly the close, we've seen better performance 484 00:27:52,520 --> 00:27:55,160 Speaker 1: in the electronic market. So I think we we are 485 00:27:55,240 --> 00:27:58,040 Speaker 1: of a strong belief and investors investor with an open, 486 00:27:58,160 --> 00:28:02,119 Speaker 1: transparent and elect on a marketplace. But that's that's our opinion. 487 00:28:03,840 --> 00:28:05,159 Speaker 1: People like to come down to the try it in 488 00:28:05,240 --> 00:28:06,760 Speaker 1: floor for the big I po is, the big song, 489 00:28:06,800 --> 00:28:08,879 Speaker 1: good dance, the Dalcom party show. You've seen a minion 490 00:28:08,960 --> 00:28:11,520 Speaker 1: times now soon I PO is in the pipeline. Can 491 00:28:11,520 --> 00:28:13,840 Speaker 1: you just give us some insight to what you're seeing 492 00:28:13,880 --> 00:28:15,879 Speaker 1: just in terms of activity. Can we expect and I 493 00:28:15,920 --> 00:28:19,040 Speaker 1: think anytime soon? Yeah, a great great questions. So we 494 00:28:19,119 --> 00:28:22,120 Speaker 1: have performed at NASDAC fiften I p o s since 495 00:28:22,160 --> 00:28:24,360 Speaker 1: the middle of March, and a lot of that has 496 00:28:24,400 --> 00:28:27,320 Speaker 1: been in the healthcare space. I think the biggest challenge 497 00:28:27,320 --> 00:28:30,000 Speaker 1: for an I p O is can they go out 498 00:28:30,080 --> 00:28:34,520 Speaker 1: on dual road show and talk constantly about the upcoming quarters. Um, 499 00:28:34,560 --> 00:28:37,639 Speaker 1: that's not as important for a healthcare or biotic I 500 00:28:37,720 --> 00:28:39,320 Speaker 1: p O. So we have seen those go out and 501 00:28:39,320 --> 00:28:42,560 Speaker 1: do very well. We are starting to see other companies 502 00:28:42,600 --> 00:28:45,960 Speaker 1: though you saw this morning water music file up for 503 00:28:45,960 --> 00:28:47,520 Speaker 1: a very large I p O. They're going on the 504 00:28:47,600 --> 00:28:50,280 Speaker 1: road today and you will see more of this week 505 00:28:50,360 --> 00:28:56,040 Speaker 1: actually file to start. So we are seeing some non healthcare, 506 00:28:56,160 --> 00:28:58,680 Speaker 1: non what we call spack I p o s start 507 00:28:58,760 --> 00:29:01,600 Speaker 1: to launch the road shows. Many of them were very 508 00:29:01,600 --> 00:29:04,960 Speaker 1: close to going in the March time frame and then 509 00:29:05,000 --> 00:29:07,280 Speaker 1: put their plans on holds. So these are deals that 510 00:29:07,360 --> 00:29:10,160 Speaker 1: were in the works for a period of time. I 511 00:29:10,200 --> 00:29:12,480 Speaker 1: will say that we are starting to see new deals 512 00:29:13,080 --> 00:29:15,360 Speaker 1: pop up, and I think what we have here is 513 00:29:15,400 --> 00:29:19,680 Speaker 1: we have a November election, but up from now until November. 514 00:29:19,720 --> 00:29:22,320 Speaker 1: If the markets do hold, which you know again today 515 00:29:22,320 --> 00:29:25,480 Speaker 1: we're seeing some pretty impressive performance, there's a chance we'll 516 00:29:25,480 --> 00:29:29,840 Speaker 1: have a healthy I P O market. That's multisector Nelson. 517 00:29:29,880 --> 00:29:32,240 Speaker 1: Who are the investors here, especially as we talk about 518 00:29:32,240 --> 00:29:37,400 Speaker 1: an increase in retail investors coming into stocks right now? Yeah, 519 00:29:37,520 --> 00:29:39,480 Speaker 1: you you are seeing to be more broad based. I 520 00:29:39,480 --> 00:29:42,160 Speaker 1: think the initial rally we did not see a lot 521 00:29:42,200 --> 00:29:44,840 Speaker 1: of long investors come into the marketplace. But I think 522 00:29:44,880 --> 00:29:48,920 Speaker 1: as you have watched the indusseries continue to go up, 523 00:29:49,280 --> 00:29:51,840 Speaker 1: you know, we're the nagic when Hunter is up almost 524 00:29:51,920 --> 00:29:54,880 Speaker 1: eight percent for the year, we haven't Askeda positive almost 525 00:29:54,880 --> 00:29:58,360 Speaker 1: three percent, the bots up. So we are starting to 526 00:29:58,400 --> 00:30:01,040 Speaker 1: see some long investors coming into the marketplace as we're 527 00:30:01,080 --> 00:30:05,120 Speaker 1: seeing the ability to get a bit more predictability in 528 00:30:05,240 --> 00:30:07,840 Speaker 1: terms of what they're hearing companies say. So once we 529 00:30:07,840 --> 00:30:11,280 Speaker 1: went through a obviously a pretty challenging earnings quarter where 530 00:30:11,360 --> 00:30:13,840 Speaker 1: a lot of companies and Polk guidance, we are now 531 00:30:13,880 --> 00:30:15,560 Speaker 1: seeing them able to go out and have a bit 532 00:30:15,560 --> 00:30:17,840 Speaker 1: more pretability and what they think may happen over the 533 00:30:17,880 --> 00:30:22,680 Speaker 1: coming quarters in a year. Also, Greggs one more question, 534 00:30:22,720 --> 00:30:24,720 Speaker 1: if we could as well one day you're gonna get 535 00:30:24,720 --> 00:30:27,160 Speaker 1: back to work. The pandemic is gonna be over, and 536 00:30:27,200 --> 00:30:30,000 Speaker 1: we're gonna reinstitute I p o s. How are you 537 00:30:30,080 --> 00:30:33,280 Speaker 1: going to compete with the New York Stock Exchange. What's 538 00:30:33,280 --> 00:30:38,360 Speaker 1: the key distinction you have in two thousand twenty one. Yeah, 539 00:30:38,360 --> 00:30:40,520 Speaker 1: our our key distinction we we obviously do very well. 540 00:30:40,600 --> 00:30:42,600 Speaker 1: Last year were one seventy eight percent of I p 541 00:30:42,720 --> 00:30:45,880 Speaker 1: o s. We're on that same track record this year. Um. 542 00:30:46,040 --> 00:30:49,440 Speaker 1: I think our big story is life cycle support, so 543 00:30:49,600 --> 00:30:53,120 Speaker 1: we do a lot to help companies the right investors 544 00:30:53,720 --> 00:30:56,400 Speaker 1: uh position their story. There's obviously, as you mentioned, a 545 00:30:56,440 --> 00:30:59,400 Speaker 1: lot of different media and support around that. So we've 546 00:30:59,400 --> 00:31:01,320 Speaker 1: been on quite a quite a run the last handful 547 00:31:01,360 --> 00:31:03,640 Speaker 1: of years, and that sev win rate and it is 548 00:31:03,680 --> 00:31:06,800 Speaker 1: a very holistic splorer. We have a residents, very wealth 549 00:31:06,800 --> 00:31:11,160 Speaker 1: companies now, So before we round things out quite clearly, 550 00:31:11,480 --> 00:31:13,720 Speaker 1: looking at the retoric coming out of Washington and the 551 00:31:13,720 --> 00:31:15,960 Speaker 1: policy too, there's got to be far more scrutiny of 552 00:31:16,000 --> 00:31:19,920 Speaker 1: foreign companies listing on US exchanges. What is the role 553 00:31:19,960 --> 00:31:22,600 Speaker 1: of foreign governments in those companies? Are we going to 554 00:31:22,640 --> 00:31:25,720 Speaker 1: have the same auditing standards the US companies have to 555 00:31:25,760 --> 00:31:28,760 Speaker 1: abide by all things that just make a whole lot 556 00:31:28,800 --> 00:31:32,000 Speaker 1: of sense. What's the stance of the NASTAC on that 557 00:31:32,040 --> 00:31:35,360 Speaker 1: situation at the moment. Yeah, I think you hit on 558 00:31:35,400 --> 00:31:38,080 Speaker 1: the one in the middle there the auditing standards, um 559 00:31:38,120 --> 00:31:40,680 Speaker 1: and and we obviously would like the US to continuity 560 00:31:41,200 --> 00:31:44,640 Speaker 1: the the global focal point for growth companies to come 561 00:31:44,720 --> 00:31:48,200 Speaker 1: and list. That said, there does need to be transparency 562 00:31:48,640 --> 00:31:51,560 Speaker 1: in terms of reportings. So we we're happy the SEC 563 00:31:51,880 --> 00:31:55,640 Speaker 1: has gotten together a group around table for a discussion 564 00:31:55,720 --> 00:31:58,560 Speaker 1: of all the ecosystem on July nine. I think that 565 00:31:58,600 --> 00:32:00,760 Speaker 1: was a very prudent move as we are seeing a 566 00:32:00,800 --> 00:32:03,640 Speaker 1: lot more he said rhetor coming out of Washington. We 567 00:32:03,680 --> 00:32:06,520 Speaker 1: need to be prepared as the ecosystem meeting the exchanges, 568 00:32:06,720 --> 00:32:10,040 Speaker 1: the banks, the auditors as well as the SEC to 569 00:32:10,120 --> 00:32:13,560 Speaker 1: make sure there's enough invest protection to invest in all 570 00:32:13,600 --> 00:32:15,840 Speaker 1: companies that come to the US. So we're supportive of 571 00:32:15,880 --> 00:32:18,960 Speaker 1: the path we're all taking. And now, so do you 572 00:32:19,000 --> 00:32:21,440 Speaker 1: look into tighten your own rules before the government does 573 00:32:21,480 --> 00:32:25,000 Speaker 1: it for you. We consistent look at our rules and 574 00:32:25,040 --> 00:32:26,960 Speaker 1: we we have tightened the rules to some degree. We 575 00:32:26,960 --> 00:32:30,160 Speaker 1: did last week. Um, it is a it's a journey. 576 00:32:30,400 --> 00:32:32,680 Speaker 1: You need to work again within the ecosystem. So those 577 00:32:32,760 --> 00:32:36,720 Speaker 1: were done in in concert with some feedback from other participants, 578 00:32:37,400 --> 00:32:40,120 Speaker 1: but we're prepared to do when we have discussions with 579 00:32:40,160 --> 00:32:43,040 Speaker 1: again that the broad based ecosystem is real important here 580 00:32:43,360 --> 00:32:46,800 Speaker 1: because not just the exchanges. It's not just the bankers 581 00:32:46,920 --> 00:32:49,960 Speaker 1: or the accountants, Detroy, everybody coming together and saying what 582 00:32:50,080 --> 00:32:52,560 Speaker 1: makes the most sense. But we we certainly will do 583 00:32:52,680 --> 00:32:56,160 Speaker 1: our our role as a producery, you know, exchange. We 584 00:32:56,520 --> 00:33:00,480 Speaker 1: have a place I think that are appropriate now, so 585 00:33:00,600 --> 00:33:02,920 Speaker 1: cover station. We've got to continue look forward, towny back 586 00:33:02,960 --> 00:33:05,720 Speaker 1: soon Nowson Griggs, that of an Astact, the president of 587 00:33:05,760 --> 00:33:12,560 Speaker 1: an Astack. The pandemic is changing. There's no question. This weekend, 588 00:33:12,720 --> 00:33:16,480 Speaker 1: the three day weekend, we saw the color of the 589 00:33:16,600 --> 00:33:19,239 Speaker 1: nation change, the tone of the nation change, and all 590 00:33:19,280 --> 00:33:22,600 Speaker 1: the ebb and flow of his tragedy from that exceptional 591 00:33:23,120 --> 00:33:26,280 Speaker 1: New York Times cover of a thousand names who have 592 00:33:26,400 --> 00:33:30,040 Speaker 1: died in this pandemic to the celebrations that were beginning 593 00:33:30,040 --> 00:33:32,720 Speaker 1: to see as America re engages, we need to get 594 00:33:32,760 --> 00:33:35,040 Speaker 1: an update on the pandemic, and we do that at 595 00:33:35,040 --> 00:33:39,960 Speaker 1: the Johns Hopkins House Hospital, Department of Medicine and their 596 00:33:40,040 --> 00:33:44,800 Speaker 1: niece Earnest. Here's Miss Earnest. We have never seen anything 597 00:33:44,880 --> 00:33:49,080 Speaker 1: like COVID nineteen and so there are hospitals have never 598 00:33:49,120 --> 00:33:54,480 Speaker 1: seen an impact like this. Frontline nurses are in a 599 00:33:54,800 --> 00:34:00,520 Speaker 1: fairly solid position. It's the nursing piece of around the 600 00:34:00,560 --> 00:34:05,120 Speaker 1: front line that is subject to review. And that's as 601 00:34:05,160 --> 00:34:08,600 Speaker 1: in any financial market situation. This is similar to what 602 00:34:08,800 --> 00:34:10,799 Speaker 1: the I was in the hotel business. We saw this 603 00:34:10,920 --> 00:34:14,160 Speaker 1: in two thousand and one with nine eleven, where the 604 00:34:14,280 --> 00:34:18,120 Speaker 1: volume dropped completely and different decisions had to be made. 605 00:34:18,520 --> 00:34:21,359 Speaker 1: But I do think that nursing is a in an 606 00:34:21,440 --> 00:34:26,520 Speaker 1: excellent position to rebound in any way because we have 607 00:34:26,600 --> 00:34:30,840 Speaker 1: a lot of professional agility. Do nurses across the country 608 00:34:31,040 --> 00:34:34,319 Speaker 1: feel like they've been taking care of both from you know, 609 00:34:34,440 --> 00:34:38,400 Speaker 1: physical but also mental point of view? I can speak 610 00:34:38,440 --> 00:34:41,840 Speaker 1: for Johns Hopkins and I know that we are reaching 611 00:34:41,840 --> 00:34:44,880 Speaker 1: out to all of our employees and encouraging them to 612 00:34:44,920 --> 00:34:48,799 Speaker 1: take advantage of the many support systems that we here 613 00:34:49,239 --> 00:34:51,000 Speaker 1: have here at Johns Hopkins, and I do know that 614 00:34:51,040 --> 00:34:54,040 Speaker 1: other institutions are doing that as well. And I think 615 00:34:54,080 --> 00:34:55,959 Speaker 1: this is one of the first times that I've seen 616 00:34:56,040 --> 00:34:59,480 Speaker 1: this big push to say to people we don't know 617 00:34:59,600 --> 00:35:03,440 Speaker 1: how we're supposed to feel. So we need to develop 618 00:35:03,480 --> 00:35:07,640 Speaker 1: some different resiliency and emotional agility skills. I know we 619 00:35:07,680 --> 00:35:11,800 Speaker 1: talked about blended rolls, so nurses actually having slightly different 620 00:35:11,880 --> 00:35:14,919 Speaker 1: roles or going and moving from one department to the next. 621 00:35:15,400 --> 00:35:17,520 Speaker 1: How do you think COVID nineteen will actually change the 622 00:35:17,600 --> 00:35:21,600 Speaker 1: nursing world forever. I think the blended model is going 623 00:35:21,640 --> 00:35:24,239 Speaker 1: to be here for quite a while. I know that 624 00:35:24,320 --> 00:35:27,480 Speaker 1: we at Johns Hopkins are looking at that very seriously. 625 00:35:28,120 --> 00:35:30,360 Speaker 1: That we're training a nurse who used to work on 626 00:35:30,360 --> 00:35:33,920 Speaker 1: a general board two elevate her skills to an i 627 00:35:34,080 --> 00:35:37,520 Speaker 1: MC level intermediate care, and the same with an intermediate 628 00:35:37,560 --> 00:35:40,319 Speaker 1: care nurse to develop those skills that are needed at 629 00:35:40,320 --> 00:35:42,680 Speaker 1: the i c U. I will tell you this with 630 00:35:42,800 --> 00:35:47,160 Speaker 1: COVID with a big wake up call about how limited 631 00:35:47,280 --> 00:35:50,680 Speaker 1: we are in the valuable I c U nursing resource. 632 00:35:51,320 --> 00:35:54,080 Speaker 1: What do we still not understand about the virus? I'm varying. 633 00:35:54,320 --> 00:35:58,160 Speaker 1: I'm reading various reports that, for example, of those who 634 00:35:58,160 --> 00:36:02,719 Speaker 1: have recovered from coronavirus could have long lasting effects on 635 00:36:02,840 --> 00:36:05,799 Speaker 1: their lungs. How much do we know about the secondary 636 00:36:05,800 --> 00:36:08,880 Speaker 1: effects of this of this disease. Well, we're learning a 637 00:36:08,920 --> 00:36:12,279 Speaker 1: little more every day, but you're absolutely right, Francine. The 638 00:36:12,360 --> 00:36:15,600 Speaker 1: impact on the long the impact on the long long 639 00:36:15,680 --> 00:36:20,720 Speaker 1: term physical condition for patients is really our next step. 640 00:36:21,040 --> 00:36:26,320 Speaker 1: One of our impatient medicine units has converted into a 641 00:36:26,480 --> 00:36:31,000 Speaker 1: mini rehab facility where we can start that rehabilitation for 642 00:36:31,080 --> 00:36:34,759 Speaker 1: patients before they're even discharged from the hospital, because we've 643 00:36:34,800 --> 00:36:38,920 Speaker 1: recognized that this is a long, long recovery process for 644 00:36:38,960 --> 00:36:43,000 Speaker 1: some patients. Sir Johns Hopkins, you know we're sitting there 645 00:36:43,000 --> 00:36:46,600 Speaker 1: with an update is well. Thanks for listening to the 646 00:36:46,600 --> 00:36:53,120 Speaker 1: Bloomberg Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud, 647 00:36:53,480 --> 00:36:57,680 Speaker 1: or whichever podcast platform you prefer. I'm on Twitter at 648 00:36:57,719 --> 00:37:02,000 Speaker 1: Tom Keane before the podcast. You can always catch us worldwide. 649 00:37:02,440 --> 00:37:03,520 Speaker 1: I'm Bloomberg Radio.