Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Jason Kelly. We're right here every day bringing you the
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Speaker 1: on Bloomberg Radio every weekday, or watch us on YouTube
Speaker 1: by searching Bloomberg Global News. Well, we're really excited to
Speaker 1: reconnect with our next guests. We last saw him, I believe,
Speaker 1: Carol on campuses, totally on campus earlier this year. Earlier
Speaker 1: this year. Uh, Joel, help us out. When did we
Speaker 1: see you? Was last fall? Wasn't it this past fall?
Speaker 1: That's right, all right, Dr. The voice you're hearing is
Speaker 1: Dr Joel bloom, president of the New Jersey Institudent Technology
Speaker 1: n J. I t we know it, as he joins
Speaker 1: us on the phone from Newark, and that is where
Speaker 1: we last saw him last fall. So Dr Blum, first
Speaker 1: of all, how are you, How are things for you,
Speaker 1: for your family, for your team. We're all well. I
Speaker 1: thank you for the question. The team is doing well.
Speaker 1: We're following all the prescriptions that we can get with
Speaker 1: regard to the c d C, the state of New Jersey, etcetera.
Speaker 1: The campus is open, we are coming to campus. We're
Speaker 1: up to about of the staff now, which is based
Speaker 1: on the guidance of our governor and the various stages
Speaker 1: of faces that have been set up. So thank you.
Speaker 1: We're doing well. I hope you are all doing well.
Speaker 1: We are all things considered concepts of time and had
Speaker 1: made very clearly at the top of the show. Yeah,
Speaker 1: exactly exactly. So tell us about what you're working on,
Speaker 1: because I mean you are you are known you personally,
Speaker 1: and I believe the school, it's fair to say, is
Speaker 1: known for as the kids would say, your collapse, your
Speaker 1: collaborations with local government, and specifically you're working on some
Speaker 1: medical works and mobile medical work importantly, uh, to fight
Speaker 1: COVID nineteen and and to sort of help out with
Speaker 1: the healthcare infrastructure or lack thereof. Tell us about them. Well,
Speaker 1: you're absolutely right. So what we saw in this UH
Speaker 1: COVID nineteen is a lack of facilities, a lack of
Speaker 1: critical infrastructure. So we are working in a free way
Speaker 1: partnership with a group called the Tuckman Foundation, University Hospital
Speaker 1: in Newark and n g I T. So we've put
Speaker 1: medical practitioners together with engineers and we've taken one of
Speaker 1: those cargo containers. We've re refashioned them. We've both of
Speaker 1: them together, if you will, and those become for healthcare units,
Speaker 1: a testing room, a beds, and two of the units UH.
Speaker 1: And we built a prototype, put it on the campus
Speaker 1: of University Hospital in New York and actually ran some
Speaker 1: testing that we did for COVID nineteen. We obviously can
Speaker 1: do reception, UM, we can take record history. So now
Speaker 1: we've created very mobile ease on mobile containers. You've seen
Speaker 1: them stacked up their railways and that at airport's very flexible,
Speaker 1: very mobile, whether it's COVID nineteen or a natural disaster.
Speaker 1: We saw what happened to Puerto Rico and the long
Speaker 1: time and coming back. These you can put them freighters,
Speaker 1: you can put them on trains, you can even put
Speaker 1: them on aeroplanes and move them around the world. So
Speaker 1: we built a prototype the three way partnership of the
Speaker 1: Foundation in the hospital and n g I T built
Speaker 1: and made up rational prototype this past week. That is
Speaker 1: so cool. So tell me, um, Dr Bloom you know,
Speaker 1: so are they going to be put into use? Um,
Speaker 1: you did the prototype. I'm just curious about what kind
Speaker 1: of response you're hearing. What are the thoughts about applications
Speaker 1: and what's the demand? Maybe get them up and running. Um.
Speaker 1: So we put it all out there on the web. Great,
Speaker 1: you know, the great Worldwide Web. We've had I don't
Speaker 1: know so many able to five thousand views a good
Speaker 1: Senator Senadate Booker, Corey Booker king view them. Um, we
Speaker 1: are interested. We'll soon hopefully be talking with SEMA. UM,
Speaker 1: we'll be talking with ni H about the application, and
Speaker 1: we're talking to hospitals, health care units, health care of
Speaker 1: systems about how you would deploy them. We certainly uh,
Speaker 1: and we know about how we're going to produce them.
Speaker 1: We've already got one factory quewed up. We can produce
Speaker 1: about a hundred, about two D beds a week. So
Speaker 1: now that we've prototyped them, we found them to work
Speaker 1: their air conditioned, unlike tents who saw tents go upright
Speaker 1: and then during this crisis during the pandemic, well, tents
Speaker 1: are very hard to heat, they're very hard to chill,
Speaker 1: and they're very hard to keep dry. These are h
Speaker 1: v A C with the state of the art filters.
Speaker 1: Um they can be negative pressurized. Uh, they don't leak,
Speaker 1: they can be warm, they can be chilled, and they
Speaker 1: can be sanitized easily. Um uh so uh, there is
Speaker 1: the replacement to these emergency tents, the applications. They can
Speaker 1: be abed for treating people. They can be diagnostic facilities,
Speaker 1: they can be registration facilities, they can be testing facilities. Again,
Speaker 1: very flexible, plug and play is how these units designed.
Speaker 1: Talk to us about getting students back to campus in
Speaker 1: a meaningful way this fall. You are right there in
Speaker 1: the middle of new work, so you have both the
Speaker 1: benefit and the drawback of a big urban campus. How's
Speaker 1: it gonna work? So the benefit is we're right in
Speaker 1: the middle of two hospitals. One I've already talked about
Speaker 1: University hospital are the ones St. Michael's. They help us
Speaker 1: with all of the testing, all of the contact tracing.
Speaker 1: So we have agreements. We're also working with the County
Speaker 1: of Essex to test everyone before they come back to campus.
Speaker 1: We're anticipating going from what the Governor's named Stage to
Speaker 1: to Stage three, which means up to of our students
Speaker 1: and our faculty and staff. So we're gonna do converge learning. Um,
Speaker 1: we had a lot of practice. We've been doing converged learning,
Speaker 1: which is while the class is going on on campus,
Speaker 1: we can tele caster that you can go on the
Speaker 1: web and participate at home. We've been doing that literally
Speaker 1: since so when we had to come back following Springs
Speaker 1: break this past much of our courses went online. So
Speaker 1: the fall we're going to do about half online and
Speaker 1: about a half in person. As a polytechnic university, we
Speaker 1: are very lab intense, and again you can do simulations
Speaker 1: to some labs, but for many labs you cannot do it.
Speaker 1: And this is part of the curriculum that very often
Speaker 1: leads to licensure or certificates for students. So um, that's
Speaker 1: the plan going forward. We're hoping to move New Jersey
Speaker 1: is hoping to move from Stage to the Stage three.
Speaker 1: You've probably been aware our numbers have been down. We're
Speaker 1: still one of the few green states in the United
Speaker 1: States UM which regard to the spread of the virus.
Speaker 1: So we're anticipating residential students, We're anticipating in class, in
Speaker 1: person students, and we expect to do a signific amount
Speaker 1: of online We will follow all of the everyone will
Speaker 1: get two masks that have been branded with NJA logos.
Speaker 1: Onto will do remote the temperature sensing around the campus
Speaker 1: and kiosks UM and again we are equipped. We'll be
Speaker 1: doing some UM waste water testing in our residential halls.
Speaker 1: And you know, students work in classes and in groups
Speaker 1: and in pods, and we'll be doing some pool testing there.
Speaker 1: So we're trying everything we can to escape our community
Speaker 1: as safe as is possible. So, Joel, I have to
Speaker 1: ask you, because you know, and just got about a
Speaker 1: minute or so left. I we we're watching, you know,
Speaker 1: other UM colleges, universities kind of figure their way back
Speaker 1: and they really are having to figure out hybrid learning.
Speaker 1: All of a sudden, you guys have been doing it,
Speaker 1: as you said, converge learning. Since do you feel like
Speaker 1: we will in the future see a lot more of
Speaker 1: what you guys have been doing for the past few
Speaker 1: years because of what happened of the virus. Does the
Speaker 1: academic academia world, academic world change or change longer term? Yes,
Speaker 1: it does. It's it's going to change because again people
Speaker 1: realize the power of having online learning. Again, not to
Speaker 1: every course, not to every discipline, but it is very
Speaker 1: powerful and it is rather effective. Again, not every discipline,
Speaker 1: not every course. So yes, I think it's been changed
Speaker 1: for ever. Absolutely. Yeah. Well, we've learned a lot from
Speaker 1: you over the years about you know, how you guys
Speaker 1: are looking around the corner when it comes to education.
Speaker 1: So we really appreciate you spending some time with us,
Speaker 1: both on some of the novel things you're doing when
Speaker 1: it comes to partnerships and testing and trade racing, but
Speaker 1: also getting students back to campus. We know it is
Speaker 1: top of mind for us and for so many of
Speaker 1: our listeners out there. So Dr Joel bloom Our, thanks
Speaker 1: to you, President New Jersey Institute of Technology. Join us
Speaker 1: on the phone from Newark, New Jersey. You are listening
Speaker 1: to Bloomberg business Week. Jason Kelly and Carol Master here
Speaker 1: with you. So let's talk a little bit about a
Speaker 1: story that I feel like Business Week has done such
Speaker 1: a great job of capturing Carol, which is this disconnect
Speaker 1: between Wall Street and Main Street. But it's more complicated
Speaker 1: than just the typical like what do investors know that
Speaker 1: you know, regular old folks don't know. Uh, and they're
Speaker 1: continuing to dig into it with a plum as they
Speaker 1: do as we do. Joel Weber is the editor of
Speaker 1: Bloomberg business Week. He joins us along with Mike Reagan.
Speaker 1: He wrote the story. He is, of course, the senior
Speaker 1: editor for Bloomberg Markets. The story investors Can't Stop Dancing
Speaker 1: to the Bull Markets tune. Joelt this up for us,
Speaker 1: So I think, um, I mean, Jason said, like we've
Speaker 1: one of the themes I think of the pandemic that
Speaker 1: we've noticed is just this utter disconnect between the sort
Speaker 1: of the real economy and the stock market. And uh,
Speaker 1: you know we've hit that note in the cover. Um,
Speaker 1: there's ways that we've hit it with even just the
Speaker 1: recent earnings of Wall Street. But you know, this this
Speaker 1: story that Mike did, I thought, really, you know, one
Speaker 1: reason that it really jumped out to me where the
Speaker 1: valuations um. And you know, as as Mike says, like
Speaker 1: very close to the top of the story, the mas deck,
Speaker 1: which obviously just it was that record has uh you know,
Speaker 1: it's the index is valuation thirty four times earnings at
Speaker 1: the highest it thin for fifteen years. When you see
Speaker 1: stuff like that, it just really jumps. It's so, Mike,
Speaker 1: what what what's behind all this? What was the point
Speaker 1: that you were able to kind of dig into in
Speaker 1: the story? Well, you know, uh so what's interesting is
Speaker 1: to me is, Okay, you have this Wall Street investor
Speaker 1: class who was trained to look at the fundamentals. You
Speaker 1: look at the potetrol for earnings, you look at it
Speaker 1: potential for economic growth, all these things, and you know,
Speaker 1: you really have this sort of rigid, sort of mathematical
Speaker 1: approach to how you invest. But sometimes none of that matters, right,
Speaker 1: It's just the market gets in this mode, um you know,
Speaker 1: whether whether you call it animal instincts or whatever, it
Speaker 1: is where um, you know, it just starts ignoring all
Speaker 1: of the problems, all the uncertainty. And one of the
Speaker 1: bigg issues right now is that if you're trying to
Speaker 1: price the stock market based on what you expect the
Speaker 1: earnings to be going forward, well it's it's almost impossible.
Speaker 1: I mean, there are numbers out there, there are, but
Speaker 1: so many companies have withdrawn their guidance that it is.
Speaker 1: It's kind of anyone's guests from an index level, from
Speaker 1: sort of the macro aggregate level level, what the earnings
Speaker 1: pictures is going to look like in the next year. Um.
Speaker 1: So you know, if you go back to the textbooks,
Speaker 1: you're sort of investing one on one that should cause
Speaker 1: an uncertainty, that would cause a risk aversion in the market.
Speaker 1: But we're really seeing the opposite. And see what's fascinating
Speaker 1: is you hear investors. We had Scott Minord of uh
Speaker 1: Guggenheim Investments quoted in the story from a recent Bloomberg
Speaker 1: TV interview, and he says, look to me, it looks
Speaker 1: like a bubble. Now that that sounds scary, but many
Speaker 1: investors who've lived through bubbles, you know, you don't want
Speaker 1: to get out on the ground floor of a bubble.
Speaker 1: You want to be there for the whole thing. So
Speaker 1: it's this sort of awkward, precarious situation where you're you're
Speaker 1: willing to write it higher even though you don't know
Speaker 1: when it's talking in Mike, I feel like we have
Speaker 1: the ultimate insurance policy to prop up the stock market,
Speaker 1: and we've essentially gone from the Greenspan put to the
Speaker 1: bernandcy put to the Powell put. I mean, the FED
Speaker 1: has shown time and time again that when we get
Speaker 1: into any kind of crisis, financial or otherwise, and this
Speaker 1: was initially not a financial crisis, it was a health crisis,
Speaker 1: the FED will be there to make sure that the
Speaker 1: financial markets operate in a liquid and smooth ways. I mean,
Speaker 1: talk about the ultimate insurance policy. Yeah, I mean, and
Speaker 1: that's absolutely part of the bullish case. Uh. For why
Speaker 1: people are willing to sort of ignore the fundamentals for
Speaker 1: now is that, UM. I think the speed with which
Speaker 1: the Federal Reserve reacted U you know, during the financial crisis,
Speaker 1: he was kind of you know, you'd get hit by
Speaker 1: these nasty headlines about damage being done to the assets
Speaker 1: of banks day after day, and it took a while
Speaker 1: through the policy to catch up with that. Um. You know,
Speaker 1: remember the troubled Asset Relief for program, that part program
Speaker 1: that failed in Congress on its first vote back during
Speaker 1: the financial crisis, this kind of the fet both the
Speaker 1: FETE and the Congress reacted very strongly and very swiftly. UM.
Speaker 1: And that's obviously the you know, the main reason to
Speaker 1: stay bullish throughout this, but I would say, you know,
Speaker 1: when you know, doesn't justify getting sort of unhinged completely
Speaker 1: from the fundamentals. UM is what I start to wonder,
Speaker 1: and you wonder how long that can possibly last? You know,
Speaker 1: markets tend to mean revert back to something that sort
Speaker 1: of makes sense fundamentally. So I think most people think
Speaker 1: that process will happen. It's just timing it is next
Speaker 1: to impossible. UM. Likedly. Another element that UM has just
Speaker 1: been such a phenomenon of the sort of the basketble
Speaker 1: months has been the day trading set. And You've got
Speaker 1: some interesting numbers here that I've really stuck out that
Speaker 1: you know, up to you uncertain days can be gage traders. Uh,
Speaker 1: that's almost twice as much as even just a decade ago. Um.
Speaker 1: How much are institutional investors actually like getting from day
Speaker 1: traders and all of this? Yeah? Well there, Yeah, there's
Speaker 1: certainly this push among you know, the hedge hedge fund
Speaker 1: class and sort of the sophisticated investor class to try
Speaker 1: to wrap their heads around what these this new horde
Speaker 1: of day traders are doing. You know, the Robin Hood app,
Speaker 1: the Robin tracker that you have that tracks let's be
Speaker 1: bought on, sold on on Robin Hood UH is very
Speaker 1: popular among the Klands now, mainly because that's kind of
Speaker 1: a window you get into the retail trader that you
Speaker 1: don't necessarily get from some of the other UH discount
Speaker 1: brokerages out there. But I do think also Joel, you know,
Speaker 1: this reduction complete elimination of brokerage fees that we saw
Speaker 1: UH you know in the past year is is another
Speaker 1: huge elemen of it. You know, if there's no friction now,
Speaker 1: if you want to gabble in stocks, you're not paying
Speaker 1: nine dollars a trade or fifteen dollars a trader or
Speaker 1: whatever you know historically used to pay. Now you can
Speaker 1: you know, you can buy a stock for free. Um,
Speaker 1: I mean, you know the obvious complich that is you
Speaker 1: can also sell it for free. So I I do
Speaker 1: think there is a risk of a of a sudden
Speaker 1: sentiment shift among that retail crowd. But you're right the
Speaker 1: volume wise, the fact that retail traders, according to Citadel
Speaker 1: UH can make up a quarter of the volume on
Speaker 1: the stock market on that any day. I mean, that's
Speaker 1: that's rivaling the hedge fund sponson and the amnium chasers
Speaker 1: of the world. So it's a force to be reckoned
Speaker 1: with that. I think paulow Walter, he's trying to wrap
Speaker 1: their head around what's to do with this information coming
Speaker 1: from the new horts of retail traders. Yeah, and the
Speaker 1: last question for you briefly, Mike, is is that a
Speaker 1: lasting phenomenon in your estimation? Mean, no one really knows,
Speaker 1: but obviously part of that has been driven by people
Speaker 1: are at home. Uh, maybe they've got a little bit
Speaker 1: of extra money if if they're lucky. How does this
Speaker 1: change as we find the next normal here? Right? And
Speaker 1: you often see it compared to sort of an entertaining product.
Speaker 1: You know, there's hey there's no on TV, you can
Speaker 1: you can't go to the movies, you can't go to this,
Speaker 1: and can't bet on sports and yeah yeah, so um,
Speaker 1: we'll have to see. I mean, if interesting to see
Speaker 1: if that sort of I does with the return of
Speaker 1: sports and the return of sort of life as it was,
Speaker 1: you know, getting back to normal live events, live concerts
Speaker 1: and that sort of thing. I don't I can't imagine
Speaker 1: it's all just people trading for entertainment, but I think
Speaker 1: it is certainly, you know, people find a lot of
Speaker 1: time on their hands with not much to the life.
Speaker 1: I could certainly feeding it alright, Mike Reagan always a
Speaker 1: treat to catch up with. You are thanks to him.
Speaker 1: Check out his story in the upcoming issue A Business
Speaker 1: Week Our Thinks as well to Joel Webber, editor of
Speaker 1: the magazine. This is Bloomberg Business Week with Carol Masser
Speaker 1: and Jason Kelly on Bloomberg Radio. All right, time to
Speaker 1: the little Business Week Economics. We are so psyched. I
Speaker 1: think that's the technical term to have back with this
Speaker 1: tots to its Christopher Condon, Chris Condon, Federal Reserve and
Speaker 1: US Economy reporter. Fun fact, you know that Chris Condon
Speaker 1: and I were colleagues on the US investing team at
Speaker 1: Bloomberg News. Oh my god, that must have been wild.
Speaker 1: It was wild. He's a man of many tales. I
Speaker 1: love his journalism. This story is Chris con the stories,
Speaker 1: the stories. He's joining us on the phone from Virginia.
Speaker 1: He's on the FED beat now, which is arguably one
Speaker 1: of the most important, not the most important, uh these days.
Speaker 1: So Chris tell us what's going on when we think
Speaker 1: about stimulus, what it's going to be, when it's going
Speaker 1: to be. This is the debate in Washington right now.
Speaker 1: It is. It's a very important debate. Jason. This is
Speaker 1: UH really I think a momentous piece of legislation that's
Speaker 1: desperately needed. It's timing could not be better if they
Speaker 1: wrap it up UM in the next couple of weeks.
Speaker 1: You know that the UH, much of the stimulus that
Speaker 1: came from the Cares Act is winding down, specifically the
Speaker 1: supplemental aid to people on unemployment benefits UM. A lot
Speaker 1: of economists feel that that if that just disappears, it's
Speaker 1: going to create a huge strain in our economy by
Speaker 1: just eliminating a lot of demand, so that it will
Speaker 1: hurt households, it will hurt businesses UM. And in so far,
Speaker 1: it looks like they are making progress towards some kind
Speaker 1: of package that would include both direct payments to households,
Speaker 1: the size of which we don't really know yet UM
Speaker 1: and some extension of the supplemental unemployment benefits those so
Speaker 1: those are really two very important things. Well, but the
Speaker 1: size is really also quite important, and we're yet to
Speaker 1: hear overall numbers. That's right, because we got three trillion
Speaker 1: in terms of a relief package. Chris back in March. Right,
Speaker 1: we got a lot of aid. The package they're talking
Speaker 1: about now is a trillion and I do wonder tell
Speaker 1: us the size of this package what it will mean
Speaker 1: for the economic recovery on the other side of the virus. Right. Well,
Speaker 1: the big thing is that so much income has been lost,
Speaker 1: Carol Um. We still have The numbers are difficult to
Speaker 1: tease out, but there's an estimated twenty five million people
Speaker 1: still receiving unemployment benefits. That's a massive amount of lost
Speaker 1: income that is up to this point largely being replaced
Speaker 1: by government assistance. Some of that replacement has got to continue.
Speaker 1: Without that, consumer spending will drop a end drastically, which
Speaker 1: then feeds on and we begin to worry about what
Speaker 1: Glenn Hubbard say from Harvard caused the demand doom loop
Speaker 1: um Less spending which means more companies layoff people, which
Speaker 1: means more lost income. That's less spending, and so on
Speaker 1: and so on. The vicious cycle that we must absolutely avoid. Uh.
Speaker 1: And some of these things will go a long way
Speaker 1: towards that. Another item that I kept coming up when
Speaker 1: I spoke to economists was aide to h state and
Speaker 1: local and so far we're not really seeing we're we're
Speaker 1: not sure whether that will emerge in this package. Ben
Speaker 1: Bernankee most recently pointed out that after the last recession,
Speaker 1: that was one of the real big headwinds that that
Speaker 1: slowed down the recovery, the fact that federal government did
Speaker 1: not really come through in helping state and local governments,
Speaker 1: so they laid off a lot of people. That was
Speaker 1: a big drag on demand. And and the same will
Speaker 1: happen and the much worse fashion this time. Um. The
Speaker 1: layoffs from state local governments are already something about twice
Speaker 1: as much as happened back after the so called Great Recession. UM.
Speaker 1: So let's talk a little bit about states in and
Speaker 1: municipal aid there, because it feels like, I wonder from
Speaker 1: your perspective, is this a philosophical or is it a
Speaker 1: political debate around that sort of aid or is it both?
Speaker 1: It is really both, UM. I think one of the
Speaker 1: important things that is, and this is a reasonable thing
Speaker 1: to raise for Republicans that what you don't want to
Speaker 1: be doing is helping state and local governments cover up
Speaker 1: holes that were pre existing. Want to help them for
Speaker 1: holes that were created in their budget by the pandemic
Speaker 1: that they had no control over. But you don't want
Speaker 1: to be bailing them out. According to the conservative economic philosophy,
Speaker 1: you don't want to be adding this moral hazard of
Speaker 1: bailing them out for having run their budgets irresponsibly, say
Speaker 1: in years previous UM. And so that's a legitimate concern, um.
Speaker 1: But to be too careful about that, I think would
Speaker 1: leave a lot of UM municipalities and states just running
Speaker 1: into the ditch. The budget short hauls are shortfalls are
Speaker 1: really massive, and in the in the vast majority of
Speaker 1: that is legitimately caused by the drop in revenue associated
Speaker 1: with the shutdowns caused by the coronavirus. I mean, it's
Speaker 1: amazing to think about me. We were talking earlier in
Speaker 1: the show, Chris, but even you look at something like
Speaker 1: the New York City subway, you know, which is so
Speaker 1: intrinsic to the way that the economy runs and relies
Speaker 1: on revenue and and and obviously employs a lot of
Speaker 1: people Like it's it's so complicated, Carol. Yeah, yet taking
Speaker 1: in too much dough these days. No, nothing. I was
Speaker 1: just talking to somebody too about um kind of utilities
Speaker 1: and just you know, the money that goes into port
Speaker 1: authority that is then you know, put back into mass transportation.
Speaker 1: I mean, it's just everything has shut down. Chris. I
Speaker 1: do wonder though, the size of this next relief program.
Speaker 1: Can it be the difference between a US recession turning
Speaker 1: into a depression or great recession? I mean, is that
Speaker 1: what we're talking about? And just got about here all
Speaker 1: of those Really if if um, if this entirely breaks
Speaker 1: down and because of some just you know, inability to
Speaker 1: find a compromise on the components or size of this
Speaker 1: prevents something which is unlikely I think, But if that happens,
Speaker 1: then the results could be rather catastrophic. Um, And that
Speaker 1: gets into that the idea, like I said, Hubbard talks
Speaker 1: about the demand doom. A compromise though that gets at
Speaker 1: least over the trillion dollar bar. Most economists feel that
Speaker 1: would be meaningful. Many of them say more is better,
Speaker 1: but they also can see that you don't have to
Speaker 1: get up into Nancy Pelosi's three point five trillier. Jason Furman,
Speaker 1: former chief economists at the White House for Barack Obama,
Speaker 1: said two trillion would be absolutely, very very helpful for
Speaker 1: this economy. So there is room for a compromise. That
Speaker 1: is very mean, right, right, well, we will track your
Speaker 1: work closely, as we always do. Chris's story about this
Speaker 1: it's gonna be featuring in the upcoming issue of Bloomberg
Speaker 1: Business Week. Check it out now on the Bloomberg or
Speaker 1: at Bloomberg dot com. Chris Condon, Fed Reserve and US
Speaker 1: Economy reporter for Bloomberg Joinius on the phone for Virginia.
Speaker 1: I love that guy. You're listening to Bloomberg Business Week
Speaker 1: with Carol Masser and Jason Kelly on Bloomberg Radio. So
Speaker 1: in this week's edition of Bloomberg Business Week Small Business
Speaker 1: Survival Guide, we continue to look at how small businesses
Speaker 1: are doing joining us right now. One of our favorite people,
Speaker 1: no doubt about it, is Kate Creators. She's food editor
Speaker 1: at Bloomberg Pursuit. She's on the phone in New York City,
Speaker 1: and she's brought along a friend, Christino Tosi. She founder
Speaker 1: at Milk Bar and creator of the Virtual Bake Club,
Speaker 1: which I would like to be a part of. And
Speaker 1: forgive me, Christina, Did I say your name incorrectly? No,
Speaker 1: you said it's just right. It's on your feet, all right,
Speaker 1: love it, love it, and you too, You too, are
Speaker 1: on the phone in New York City. Um, okay, just
Speaker 1: que us up here. I mean, we've been talking to
Speaker 1: you so much about small business, the restaurant space in particular. Um,
Speaker 1: how are they finding how's everybody finding the way back?
Speaker 1: And and and just give us a little bit of
Speaker 1: background here. Um. Well, I have to say intrepid restaurateurs
Speaker 1: and business owners are I mean, I think they're doing
Speaker 1: things by any means necessary now. And we reported last
Speaker 1: week on how a lot of them we're dealing with
Speaker 1: this crazy weather, not just intense rainstorms but also intense heat. Um.
Speaker 1: And then there are people like Christina Cosey. So all
Speaker 1: my favorite people are on the phone right now on
Speaker 1: this call. Kristina Tosey, who started Milk Bar. I hope
Speaker 1: everybody has had like a compost cookie and a birthday
Speaker 1: cake truffle in their life. Those are the brainchild of Christina,
Speaker 1: and she started milk Far what like a dozen years ago.
Speaker 1: Christina is that right, eleven and counting elevenon counting, And
Speaker 1: then in the midst of the pandemic, she was, um,
Speaker 1: she woke up and she was like I want to
Speaker 1: be out there, Like I want to figure out how
Speaker 1: to be out there for my people. Because her fans
Speaker 1: are really intrepid, and so she started this virtual bay
Speaker 1: Club on Instagram live and every day for a hundred days,
Speaker 1: see like peat up the ingredients that people would needs
Speaker 1: the day before on Instagram and then started the bay
Speaker 1: Club and it gets her videos get like eighty thousand views.
Speaker 1: It's monumental, alright. So Christina tell us about this, like
Speaker 1: what was the inspiration and and also walk us through
Speaker 1: how it works, because it's a very deliberate process where
Speaker 1: you give people the ingredients so that they can be
Speaker 1: ready for the next day. Right, Yeah, that's right. So
Speaker 1: I I was not not too similar to how everyone
Speaker 1: was feeling, you know, at the beginning of COVID nineteen
Speaker 1: hitting the US, you know, faced with with with so
Speaker 1: much uncertainty and in all of the different corners of life.
Speaker 1: And I was sort of raised that when sort of
Speaker 1: like uncertainty and tragedy and scarcity hits, you figure out
Speaker 1: how to get into the world and be a part
Speaker 1: of something bigger than yourself. And my biggest issue with
Speaker 1: done with that you're not allowed to leave your house,
Speaker 1: right And I just had a moment where I said,
Speaker 1: I've got I've got to do something and I've got
Speaker 1: to do something with um my effort and my energy.
Speaker 1: And I just went to the place that where I
Speaker 1: feel the most myself, where I have realized the most
Speaker 1: impacting people's lives, and that's the kitchen. And I just
Speaker 1: went online one day um and said, hey, I am
Speaker 1: like I'm I'm feeling useless. I'm feeling like I missed
Speaker 1: it togetherness, and I just think I'm gonna start a
Speaker 1: bait club, like, is anyone else interested in joining? And
Speaker 1: it's still what time works. And I just got the
Speaker 1: most recent resounding response, right like, no real intention, no
Speaker 1: real plan. I didn't think about one of my posting
Speaker 1: it is that or the other. I just threw it
Speaker 1: out there into the world and it's stuck. And so
Speaker 1: every day I was very deliberate about every uh, every
Speaker 1: day prior to bait club. So sometime in the evening,
Speaker 1: I just post the ingredients that you need for the
Speaker 1: next day, and it's usually, you know, the most basic
Speaker 1: ingredients flour, sugar, butter, salt, what have you. And then
Speaker 1: if there are some sort of like substitutions, there's usually
Speaker 1: a star ingredient. Maybe it's press soels, maybe it's oaths,
Speaker 1: maybe it's whatever you have the snacky lyne in your cupboard.
Speaker 1: And I'm intentional. I don't even tell by club what
Speaker 1: we're making until we're about five minutes in, until we've
Speaker 1: washed our hands with warm, soapy water and felt out
Speaker 1: happy Birthday, unapologetically thin whoever's birthday it is. I play
Speaker 1: a playlist, and it's not until your oven is preheated
Speaker 1: and you pulled out your ingredients that I even tell
Speaker 1: you what we're making. Because I think we're all looking
Speaker 1: for a little moment of surprise and wonder, a moment
Speaker 1: that we can't talk ourselves into our out of, where
Speaker 1: we just have to show up as we are. And
Speaker 1: it is ready for an adventure. And it is brilliant.
Speaker 1: It is brilliant. I'm going down a rabbit hole right
Speaker 1: now as I look at it. Um, I know, but
Speaker 1: it's so like, it's so clever, this whole idea of
Speaker 1: kind of putting out the agreements but leaving some mystery
Speaker 1: right about kind of what we're gonna do. What has
Speaker 1: surprised you, Christina about this whole process? I think the
Speaker 1: way that it has stuck in people's lives, the intention
Speaker 1: which which people show up at two pm there. I
Speaker 1: think in a in a culture that is probably consumed
Speaker 1: with control all the things that we have control of.
Speaker 1: We have been challenged these past months with our awareness
Speaker 1: of the lack of control that we actually have over anything.
Speaker 1: I mean, we have responsibility for our own actions, but
Speaker 1: in the in the larger shapes and space of it,
Speaker 1: and that people are still looking for these joyful moments.
Speaker 1: They're looking for a moment of lightness and brightness. They're
Speaker 1: looking not for perfection in the kitchen, but for something
Speaker 1: that makes them feel accomplished and that gives them a
Speaker 1: reason to connect with someone else, to share their baked goods,
Speaker 1: to do good with what they're doing. Even to be honest,
Speaker 1: it's amazing to me that people will show up not
Speaker 1: knowing what they're making, and I will singlehandedly like trick
Speaker 1: them into learning how to make bagels. You know what
Speaker 1: I do? Like how deeep that you would say, like
Speaker 1: I gotta go to culinary cool. I'm not ashamed I
Speaker 1: can't do it right. Like those sorts of things are
Speaker 1: pretty powerful for these It sounds like we all need
Speaker 1: to get in the kitchen together kick creater with a
Speaker 1: good bottle. Now we know, like we're bleeding audience at
Speaker 1: two pm because they're all going to bake with Christina Tozi.
Speaker 1: All right, great to catch up with you. Christina Tozi,
Speaker 1: founder of Milk Park, creator of the Virtual Bay Club.
Speaker 1: Check it out on Instagram Live. Our thanks to to
Speaker 1: our fave kat k k Crater, food editor for Bloomberg
Speaker 1: Pursuits both on the phone from New York City. When
Speaker 1: life hands you lemons, Carol make Lemon bars Man, totally
Speaker 1: Lemon bars Well done, Jason Kelly Score Road mac a
Speaker 1: journal Now, but you let me drive? Oh no, no, no
Speaker 1: no no, who's going to drive home? Honey? Please, I'll
Speaker 1: do the riding ravel ext me. I want to drive,
Speaker 1: just drive, baby, the questions trying. This is the drive
Speaker 1: to the Globe community. Thanks. We'll drying us down on
Speaker 1: Bloomberg Radio. Yes, indeed, every one time for the Drive
Speaker 1: to the Clothes. On this Tuesday, Bob Dollars with us,
Speaker 1: chief equity strategist senior portfolio manager at New Vine Asset Management.
Speaker 1: He's joining us on the phone from Princeton, New Jersey. Bob,
Speaker 1: delighted um to have you here with us on this Tuesday.
Speaker 1: I hope you're doing well, doing great, good afternoon. Well,
Speaker 1: I'm looking at some of the research that you shared
Speaker 1: with us, and you have some views about kind of
Speaker 1: what the second half looks like. What the visibility do
Speaker 1: you feel like you do truly have about the second half?
Speaker 1: Especially here we are just kind of embarking on second
Speaker 1: quarter earnings, certainly less than usual. We are in unprecedented circumstances,
Speaker 1: and uh, it's always a guess what the next six
Speaker 1: months are going to look like, but these are extra
Speaker 1: guesses because of all the uncertainties I'm talking about the election, coronavirus,
Speaker 1: second wave possibilities, the fact that the market has done
Speaker 1: so well and valuation levels are not particularly cheap, while
Speaker 1: at the same time we have that sea of liquidity
Speaker 1: from the FIT. So there are lots of variables driving
Speaker 1: this market. And Bob, you know you said it right,
Speaker 1: We've got less less than usual in part because a
Speaker 1: lot of CEO s are kind of taking an opportunity
Speaker 1: to tell us less. In many cases now it's fair
Speaker 1: to say that they don't know maybe what their business
Speaker 1: is going to be for all the reasons that you
Speaker 1: just identified. But do we need to should we be
Speaker 1: hearing more from them in terms of their plans when
Speaker 1: it comes to spending and expectations, I think more than
Speaker 1: we did after the first quarter. Remember the first quarter
Speaker 1: releases came out in late April early May, and that
Speaker 1: was just early into the COVID situation. So if they
Speaker 1: raise their hand and say, yeah, we really just don't
Speaker 1: know where our business is going, we understood that. You know,
Speaker 1: it's now three months later and they ought to have
Speaker 1: a little better field. You know, I give them a
Speaker 1: pass sort of like I did up front. It's more
Speaker 1: unknowable than usual, but maybe you can give me some trends.
Speaker 1: You know, was was June better than May? Was May
Speaker 1: better than April? Kind of what? What What? What's the world
Speaker 1: looking like? You know, I have to say I was
Speaker 1: delighted when I knew you were going to be on
Speaker 1: Vince and Norella, who watches the markets, We've been talking about,
Speaker 1: you know, some of your outlooks um and you know,
Speaker 1: what I think is interesting is you're someone who's seen
Speaker 1: so many different market cycles. And I'm not trying to
Speaker 1: date you or anything like that, but I just think,
Speaker 1: you know, you bring a certain level of expertise to this.
Speaker 1: How do you kind of look at this market cycle?
Speaker 1: Is there something in history that we can even compare
Speaker 1: it with. Unfortunately not where we just we've just had
Speaker 1: the sharpest and shortest recession in uh certainly modern times,
Speaker 1: if not US history. Give me the parallel, there isn't one.
Speaker 1: This is an exogenous shock, this coronavirus that we're dealing with,
Speaker 1: and we don't know what the uh flare ups are
Speaker 1: going to look like. We don't know is there going
Speaker 1: to be a second wave. Then you put all the
Speaker 1: politics with it. Take it, for example, school reopenings, that's
Speaker 1: as much politically as it is economic as it is
Speaker 1: about health. And so the uncertainties are are high, and
Speaker 1: they're just unprecedented. These are unusual times. So, Bob, you
Speaker 1: and exactly where I wanted to go next, which is
Speaker 1: our inability. And I think it's it's right that we
Speaker 1: are unable to really sort of break all these things out.
Speaker 1: They're all interrelated in many ways, and it feels like
Speaker 1: politics has creeped into places that it candidly historically has
Speaker 1: not gone. And it's a presidential election year. Tell us
Speaker 1: how you're looking at the presidential election, because it's getting
Speaker 1: closer and closer. We're almost to August, we're almost to
Speaker 1: that point where we're gonna have the conventions, whatever those
Speaker 1: are gonna look like, and things are really going to
Speaker 1: be set for that last run to the election. How
Speaker 1: do you see investors looking at this choice at this point?
Speaker 1: So for starters, we do these ten predictions that year.
Speaker 1: I've been doing it for thirty years. Never have I
Speaker 1: come out with a second set. Because a coronavirus in April,
Speaker 1: we came out with the second set. I bring that
Speaker 1: up because our election forecast changed Donald Trump on January one,
Speaker 1: and our view was pretty much a shoe in for
Speaker 1: re election. Because presidents that run for a second term
Speaker 1: where there is no recession have always, no exceptions, have
Speaker 1: always been re elected. Presidents that face a recession and
Speaker 1: run for another term are almost always defeated. So the
Speaker 1: calculus changes. I think the market um usually pays attention
Speaker 1: to the election kind of post the conventions. Perhaps it
Speaker 1: started already, but post the conventions, and if the money
Speaker 1: polls and the opinion polls are right, the odds of
Speaker 1: a Democratic sweep have moved up a bunch, and a
Speaker 1: Democratic suite probably means higher taxes for corporations and wealthy
Speaker 1: and individuals and high income earners, and it probably means
Speaker 1: some reregulation. And I think that set of comments I
Speaker 1: just made generally not favorable for the capital market. So
Speaker 1: there's a lurking negative out there in my view. What
Speaker 1: about the Cold War between the US and China? Could
Speaker 1: that potentially improve with a Biden White House? Well, that's
Speaker 1: very interesting. It is possible that a Biden administration would
Speaker 1: be less strict about dealing with China around trade issues
Speaker 1: and the like. And so you have to make an assessment.
Speaker 1: Is the market going to focus on the short term
Speaker 1: quote positive that comes from that potential change versus the
Speaker 1: long term? Oh my goodness, who's going to ever deal
Speaker 1: with China and their quotes stealing our technology, etcetera, etcetera.
Speaker 1: Um so short term it could be a bit of
Speaker 1: a lift, I would agree. Just got about a minute
Speaker 1: left here, Bob, So what do you do? What's your
Speaker 1: advice to investors as we look at this second half
Speaker 1: in terms of where to allocate assets? Yeah? I start
Speaker 1: by this is so so trite, but so true. You've
Speaker 1: got to know what are you investing for, what's your
Speaker 1: time arising, what's your risk tolerance? Tolerance? Focus on that
Speaker 1: and all this market noises all around that if you
Speaker 1: have money, as a lot of people do, sitting on
Speaker 1: the sidelines earmark for the stock market, perhaps because you
Speaker 1: never put it in or you took it out on
Speaker 1: the decline. Dollar cost average. No one can pick tops
Speaker 1: and bottoms, so this is a great environment for dollar
Speaker 1: cost average. And put a little in every month for
Speaker 1: the next you pick the number of months, six months,
Speaker 1: twelve months, uh, and and invest their big companies that
Speaker 1: have good free cash flow characteristics, that can service their debt,
Speaker 1: that can expand their business, that can do business in
Speaker 1: the new world in which we live. Great stuff. Thank
Speaker 1: you so much, Bob, really appreciate your insight, and you know,
Speaker 1: fascinating Jason. I think about what you did with um
Speaker 1: Bloomberg invest right. Uh. Were you guys the culture rhead,
Speaker 1: same idea, the reboot, And that's exactly what Bob just did.
Speaker 1: This whole idea that this was not a year that
Speaker 1: anybody could have called. And you've got to rethink your assumption.
Speaker 1: So I'm great to catch up with Bob doll Over
Speaker 1: at New Vine Asset Management. He's the chief equity strategist.
Speaker 1: Thanks so much for listening to Bloomberg Business Week. Download
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