Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane Jailey.
Speaker 1: We bring you insight from the best in economics, finance, investment,
Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,
Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg Robert
Speaker 1: Dalla is with us. He's in no vinesset management, and
Speaker 1: he is the guy who kept you in the market.
Speaker 1: To enjoy a ten year per year return of fifteen
Speaker 1: percent plus the doll mandate, you gotta be in the
Speaker 1: markets to play described to play this morning, Bob Doll.
Speaker 1: Why should I be in the equity markets? Because the
Speaker 1: economy and earnings this year are going to be off
Speaker 1: the charts. We're gonna have the strongest economic growth this
Speaker 1: year and at least twenty could be as many as
Speaker 1: the strongest growth in thirty six years. That will carry
Speaker 1: things long. This will be a great year for the
Speaker 1: economy and earnings. I think it's just a good year
Speaker 1: for the stock market. In other words, I think multiples
Speaker 1: are held back a bit, Tom, because of modestly rising
Speaker 1: interest rates and inflation. Behind you is the logo of
Speaker 1: the Esteem Novine of Chicago, owned by T I a
Speaker 1: a craft. You know the retirement combine. Good morning, Roger Ferguson,
Speaker 1: Bob Dole. Do you need to raise your actuarial assumption
Speaker 1: with double digit returns? Democratic President? How Senate do you
Speaker 1: begin to lift up our actuary return? Oh? Maybe for
Speaker 1: the next few months, Tom, But longer term, I don't
Speaker 1: think so. Stocks and bonds are both expensive relative to
Speaker 1: their history. Therefore, the next five and ten years, the
Speaker 1: return is probably going to be a lot lower than
Speaker 1: it was for the last five or ten years. That's
Speaker 1: the law of averages. So it's gonna be a harder
Speaker 1: to make a buck going forward. How much? How much harder?
Speaker 1: In other words, are we look at a future? Are
Speaker 1: we're looking at a three or four percent future? It
Speaker 1: makes a difference when you know somebilities agreed. So if
Speaker 1: stocks were fifteen for the last ten years, I'll guess
Speaker 1: half that for the next ten years seven on a
Speaker 1: good day, eight bonds are gonna be a lot lower
Speaker 1: because their coupon. You can't take rates lower than where
Speaker 1: we were. And therefore, if rates climb higher, we're gonna
Speaker 1: road the coupon. So return on and treasury bonds are
Speaker 1: going to be close to zero. Meanwhile we have the
Speaker 1: US continuing to borrow money. And Tom and I were
Speaker 1: just talking about how the Hawks have been defeated, have disappeared.
Speaker 1: However you want to frame it, Are we moving towards
Speaker 1: a modern, modern monetary theory world and what does that
Speaker 1: mean for markets? I suspect we are in that world,
Speaker 1: and whether we've called it that or not, look that.
Speaker 1: I think the question I get from financial advisors most
Speaker 1: of the last five years is what about the debt
Speaker 1: and the deficits? And my response was, and still is,
Speaker 1: it doesn't matter yet. You see, interest rates have fallen
Speaker 1: faster than the debt has gone up, so interest expense
Speaker 1: is a percentage of our economy has actually gone nowhere,
Speaker 1: and therefore it's not been an issue. If we pile
Speaker 1: up the debt, interest rates star climbing higher, then we're
Speaker 1: gonna have a day of reckoning. Bob Dolan, time Keene
Speaker 1: reading a Hio Runner and Bernstein this was a few
Speaker 1: years ago. And the debt and the deficit which was
Speaker 1: a gospel, and the confusion of cash in actual royal accounting.
Speaker 1: Bob Dol, I want to get back to the markets.
Speaker 1: You know, the acclaimed Ibbotson chart out of Yale University.
Speaker 1: But within that lower left to the upper right there
Speaker 1: is rotation. How do you play the rotation of two
Speaker 1: thousand twenty one after a decade where economic growth globally
Speaker 1: has been so so at best, which has favored the US,
Speaker 1: our economy, our markets, and our currency. Because we are
Speaker 1: the most defensive economy in the world, we have fewer cyclicals.
Speaker 1: We are now reflating, thank central banks all over the world,
Speaker 1: We're gonna have some stronger growth and therefore batons are
Speaker 1: getting passed from growth to value, from big too small,
Speaker 1: from US to non US. What about the battle of
Speaker 1: active in index NVENE really takes both parts of that equation,
Speaker 1: But there's just a general feeling out there about stock
Speaker 1: picking or sector picking, or the value of buying indexes
Speaker 1: or sub indexes. Which is it so in a year
Speaker 1: like last year when the big five stocks outperformed by
Speaker 1: massive amounts, that's a year for the index. If this
Speaker 1: is a year when those have dozen stocks don't perform
Speaker 1: as well as the averages, which is our guests, then
Speaker 1: the average stock begins to do better and active managers
Speaker 1: have a better chance. I think the average active manager
Speaker 1: will outperform well. Everyone wants to be an active manager,
Speaker 1: at least if you take a look at the robin
Speaker 1: Hood accounts and people sitting home getting their stimulus checks
Speaker 1: and putting them into to individual equity. I was, I
Speaker 1: was looking at one statistic yesterday that a handful of
Speaker 1: penny stocks accounted for a fifth of all US equity
Speaker 1: trading on Monday. How much do you think about that?
Speaker 1: Increased retail presence in equity trading? When you think about
Speaker 1: acid allocation is definitely a force out there. It's a
Speaker 1: narrower group of stocks as you hinted at, and therefore
Speaker 1: you have to know kind of where are they playing now.
Speaker 1: Some of those rebinating investors actually did very well. They
Speaker 1: bought into the decline last March and they bought high
Speaker 1: beta stocks, so they've done reasonably well. We got to
Speaker 1: watch them carefully them. That group, along with the algorithms,
Speaker 1: create the issues for buying and selling stocks all day.
Speaker 1: You gotta you gotta be really careful, all right. In meantime,
Speaker 1: you have these I p o s. The tech I
Speaker 1: PO is coming out. We were talking about a firm
Speaker 1: earlier with incredible valuation, some people saying they're worth it,
Speaker 1: other saying signs of froth, including Jeff Gunlock of Double
Speaker 1: Line Capital. Where do you weigh in? I mean, how
Speaker 1: are you playing in some of these I p o
Speaker 1: s At least I think that there is merit to
Speaker 1: the fact that the size of them, the number of them,
Speaker 1: the premium that that they're selling at means we've got
Speaker 1: some speculation. Now it's easy to compare it to where
Speaker 1: we were at the tech dot com bubble. Were nowhere
Speaker 1: near that level in terms of valuations. Remember there were
Speaker 1: no earnings then, there were a few sales. It was
Speaker 1: priced the clicks, priced the eyeballs. Now we can at
Speaker 1: least touch the revenues of these companies. So I don't
Speaker 1: want to sound the alarm like we could have or
Speaker 1: should have or did sound back Man, Bob Dole, you've
Speaker 1: been such a sane voice for participating in the markets
Speaker 1: over the years. Richard Edelman joined us an hour and
Speaker 1: a half ago as well with his famed Edelman Trust Barometer,
Speaker 1: and it's about media distrust, distrust of politicians, distrust wrapped
Speaker 1: around vaccination. I want you to talk about your world
Speaker 1: in the Friday onset of gloom that's out there, you know,
Speaker 1: there's a rule every day the gloom crew comes out
Speaker 1: to beat up Bob Dole. How do we get back
Speaker 1: the trust of Wall Street strategists who have enjoyed this
Speaker 1: blue market? How do we get a belief in that optimism.
Speaker 1: I think it's gonna take some time, Tom and and
Speaker 1: some returns that are good. Look, last March February March
Speaker 1: destroyed a lot of people's faith in all the things
Speaker 1: you just mentioned. All they had to do is hang
Speaker 1: around or blink. I mean, if you were Van Winkle,
Speaker 1: you thought last year was a good, calm, quiet year
Speaker 1: because nothing really happened from from beginning year to end
Speaker 1: of the year. But of course the the in between,
Speaker 1: volatility kills people's confidence. But volatility is when you can
Speaker 1: make a buck. Bob do I have to leave it there,
Speaker 1: Robert Dole, thank you so much. With nlvin just wonderful
Speaker 1: to kick what we're really good at, Lisa Bram, It's John,
Speaker 1: Jonathan Faraoh and myself. We right to get out front
Speaker 1: and we've got a team that puts together guests and
Speaker 1: then we know when the news changes, when the facts change,
Speaker 1: we tell the guests to change. We can do that
Speaker 1: with Lester Monthson would be gr group with a distinguished
Speaker 1: career in Washington in foreign policy Lester months and we
Speaker 1: learned moments ago from what I think is the most
Speaker 1: important signal from the nascent Biden administration that they will
Speaker 1: take John Fitzgerald Kennedy's US AID program, which has been
Speaker 1: a political football for fifty sixty years, and they will
Speaker 1: restructure it and elevate it to a White House position.
Speaker 1: With Samantha Power, what is President elect Biden signaling Well,
Speaker 1: for the for folks who follow foreign assistance issues and
Speaker 1: soft power and uh and these kind of more obscure
Speaker 1: aspects of American diplomacy, it's terrific news. Samantha Power is
Speaker 1: is a force. She's an intellectual powerhouse. I'm not, and
Speaker 1: she's right about every single issue. But she's dynamic, she's interesting.
Speaker 1: She's going to bring a lot of energy and verve
Speaker 1: to what has been, frankly a sleepy agency in the
Speaker 1: US government. I think it's a It's a huge opportunity
Speaker 1: for President Biden to make a difference around the world,
Speaker 1: particularly the developing world, a place where we haven't really
Speaker 1: been present for the last four years. If we assume,
Speaker 1: whatever our politics, that we are restructuring U s A,
Speaker 1: I d are we going to restructure state? And do
Speaker 1: you look for the same drama from a new State Department? Uh?
Speaker 1: You know, that's a great question. One of the things
Speaker 1: that President Biden appears to be doing is really strengthening
Speaker 1: the NSC, which means he's he's pulling power into the
Speaker 1: White House. That's not great for the State Department. Tony
Speaker 1: Blincoln is a trusted advisor. If he's confirmed as secretaries,
Speaker 1: I expect he will be. That will be a plus
Speaker 1: for the department, But there there could be rocky times
Speaker 1: ahead for the State Department. Lester as a never Trump
Speaker 1: Republican yourself who still considers himself a republic In who
Speaker 1: worked in the Bush administration. How does the the Republican
Speaker 1: Party without Trump distinguish itself from the Democratic Party of today. Well,
Speaker 1: I think there's plenty of issues where that can happen. Uh,
Speaker 1: economic issues, social issues, Uh, foreign policy. Republicans are a
Speaker 1: hawkish national security party. We need to find that voice again.
Speaker 1: It's been modulated and muddied up during the Trump years.
Speaker 1: Liz Cheney is as good a carrier of that message
Speaker 1: is anyone. Adam Kinzinger who's going to be supporting her
Speaker 1: in voting for impeachment of the president is another excellent
Speaker 1: voice in that regard. So I see some of these younger,
Speaker 1: more dynamic Republicans are emerging from this chaos. Do you
Speaker 1: think that those younger and more dynamic Republicans will vote
Speaker 1: in tandem with Democrats to get some sort of fiscal
Speaker 1: stimulus through, to get some of other aspects of Joe
Speaker 1: Biden's administration through, even if it's sort of muddies this
Speaker 1: line as they try to re establish their identity. I
Speaker 1: think that's going to be on a case by case basis.
Speaker 1: Republicans are occasionally fiscal conservatives, not so for the last
Speaker 1: four years. They seem to be rediscovering that, as they
Speaker 1: often do when they're not in the White House. So
Speaker 1: there's a little bit of cynicism there. But I expect
Speaker 1: that Republicans will be more skeptical of massive payments UH
Speaker 1: in response to the pandemic. But but they'll be places
Speaker 1: where Republicans, never Trumpers, and even some pro Trump Republicans
Speaker 1: will find a way to vote with the Biden administration.
Speaker 1: I expect there to be more bipartisanship than people think
Speaker 1: in the next few months, let's do I don't want
Speaker 1: you to game what we see after five pm is today,
Speaker 1: But can the Senate find seventeen Republican votes to convict
Speaker 1: the President of the United States. I know that's an
Speaker 1: unfair question to you, but that is the question of
Speaker 1: the moment. It is the question is what everyone's reading
Speaker 1: between the lines for It's it's a very difficult goal.
Speaker 1: It's a high bar to get over. The fact that
Speaker 1: Mitch McConnell is out there signaling that he might embrace
Speaker 1: this process is very telling. He does not do things
Speaker 1: on a whim. He would only be sending that signal
Speaker 1: if it looked like there was progress towards that goal.
Speaker 1: Now there's there's plenty of road to go down here.
Speaker 1: Even though it's just a few days. Uh, there's there's
Speaker 1: a lot of work to be done. There's a lot
Speaker 1: of voices we need to hear from. But it does
Speaker 1: seem like things are trending in that direction. I still
Speaker 1: think it's it's probably too difficult to quite get there.
Speaker 1: But we're on the way, you know. I look, we're
Speaker 1: on the way, and you know we're on to do changes.
Speaker 1: I want to circle back luster two. Our foreign policy.
Speaker 1: What again, is there going to be a strategy or
Speaker 1: a theme that you can glean now from Biden foreign
Speaker 1: policy or not. Uh, It's it's hard to say. You know,
Speaker 1: during the campaign and during the transition, the Biden people
Speaker 1: would put out a kind of boilerplate statements saying they
Speaker 1: wanted to restore US leadership in the world. And I
Speaker 1: think those of us who are in the swamp are
Speaker 1: a little more cynical kind of dismissed that. But that's
Speaker 1: a very real thing right now. Given the events of
Speaker 1: last week, the President Biden is going to have to
Speaker 1: take active steps to restore the image, the posture, and
Speaker 1: the leadership of the US. And you're just gonna have
Speaker 1: to do that. It's gonna take one time. Lester, thank
Speaker 1: you so much. Particularly on that breaking news of a
Speaker 1: new U. S a I D program for President elect Biden.
Speaker 1: Lister Munson would be gr group. It is time for
Speaker 1: a reset. We're doing this within the huge distractions of Washington,
Speaker 1: of course, his agony of a pandemic. Michelle Meyer joins
Speaker 1: from Bank of America Securities, Head of US Economics. Michelle,
Speaker 1: and you're a claimed spreadsheet out to June and dare
Speaker 1: I say, out to the end of two thousand twenty one,
Speaker 1: what numbers have you tweaked? What are you changing at
Speaker 1: the margin? Given the just to the outrage of this
Speaker 1: January earth So um he sam hi suka to be
Speaker 1: here this morning, And you know, I think on the upside, certainly,
Speaker 1: it's what you all have been very focused on, which
Speaker 1: is the news coming out of Washington around the prospects
Speaker 1: of additional stimulus UM and the extent to which that
Speaker 1: is passed quickly in the year UM with you know,
Speaker 1: additional quote unquote transfer patments either through unemployd insurance or
Speaker 1: another round of checks or agency and local governments that
Speaker 1: can provide a real big uh you know jold to
Speaker 1: the economy UM in the spring. So that's certainly the
Speaker 1: upside story, and it's an important one. UM. On the downside, UH,
Speaker 1: we have to continue to pay attention to the virus.
Speaker 1: The virus cases are rising, restrictions are ongoing. We did
Speaker 1: pretty clear moderation of growth at the end of UM.
Speaker 1: So it's these these offsetting factors UM, which I think
Speaker 1: are extremely important as we love in few months. I
Speaker 1: want to go back to your first acclaim, which is
Speaker 1: analysis of the American housing market. Is the housing boom
Speaker 1: right now only about the halves removed from this pandemic. Yeah, so,
Speaker 1: you know, I do think part of what's happened in
Speaker 1: the housing market reflects the quote unquote case shaped recovery UM.
Speaker 1: The fact that those folks that have been able to
Speaker 1: keep their jobs through this UM horrific time have done
Speaker 1: so with pretty stable wage growth UM and a lot
Speaker 1: of you know, unintentional savings as a result of restrictions
Speaker 1: and the inability to spend on certain services. And that
Speaker 1: clearly has led to greater investment in housing and housing
Speaker 1: gleted items. Whereas those that you know have have had
Speaker 1: a harder time accessing the housing market have been more
Speaker 1: inclined to be renters, have seen greater stress. So I
Speaker 1: do think that's part of the story that said, Um,
Speaker 1: there's been a broad, you know pick up in in
Speaker 1: in housing activity. You know, it's not just the very
Speaker 1: high end of the market. You have seen the movement
Speaker 1: as well on the lower end of the housing market.
Speaker 1: And just looks this morning, mortgage applications uh nearly seventeen
Speaker 1: percent increased week over a week, purchase applications of eight
Speaker 1: percent week over a week, So you know, it looks
Speaker 1: like we're going to be maybe heading into that spring
Speaker 1: selling season with a bit more momentum as well for
Speaker 1: how things given where we are with mortgage rates. So, Michelle,
Speaker 1: when you talk about the K shaped recovery and the
Speaker 1: halves and the have nots, as Tom said very well,
Speaker 1: there's a question of how important the rally and asset prices,
Speaker 1: which really is a feature of the halves is for
Speaker 1: the broader economy for both the halves and the have nots.
Speaker 1: How crucial is it the asset prices continue to go
Speaker 1: up or at least stay high for the economy to
Speaker 1: gain steam. So that's one of the transmission mechanisms I
Speaker 1: guess you may say of monetary policy is that by
Speaker 1: keeping interest rates extraordinarily low, um, they're yes, lowering the
Speaker 1: cross of capital, making it easy to bar, but they're
Speaker 1: also helping to inflate asset prices and build wealth and
Speaker 1: that wells ultimately should be spent to some expense um
Speaker 1: and support the broad economy. UM. So elevated asset prices,
Speaker 1: I would say, is you know, comes with easy or
Speaker 1: financial conditions, which is one of the very important mechanisms
Speaker 1: by which monetary policies supports the economy. Well, I guess
Speaker 1: the reason why I asked this is in light of
Speaker 1: the inflation data that we were just talking about c
Speaker 1: p I, which rends and housing prices are a part
Speaker 1: of There's this feeling that the inflation that we've seen,
Speaker 1: the money that's been printed has gone almost entirely into
Speaker 1: the financial markets and hasn't been able to really trickle
Speaker 1: out into the right into the real economy that much,
Speaker 1: just because so much of it's been shut down. How
Speaker 1: much is it important? I mean, how what's the risk
Speaker 1: here that if we do get a disinflation or a
Speaker 1: deflation of asset prices sell off a bust that could
Speaker 1: really disable the economy in a massive way. So I
Speaker 1: would say there's there's there's yes. Looking at asset prices
Speaker 1: is one important, you know, channel, but also think about
Speaker 1: the money supply that's more kind of the real economy,
Speaker 1: and that reflects the fiscal policies have been put inflation.
Speaker 1: There's been a dramatic increase in the money supplies. None
Speaker 1: of that asset price inflation or the money suffy gain
Speaker 1: has yet to filter in to underlying inflation, but it
Speaker 1: can over time. If it works to support higher economic
Speaker 1: growth and an increase in GDP growth, which ultimately leads
Speaker 1: that browning of labor market um growth and and and
Speaker 1: prompt the higher inflation. But that's not the story for today.
Speaker 1: You know, we saw from today's CPI report underlying measures
Speaker 1: of inflation are still extremely teams given that we have
Speaker 1: this lack in the economy. And to your point, what
Speaker 1: if we have, you know, a big kind of sell
Speaker 1: off in the market or this kind of cool quote
Speaker 1: deflation and asset markets. I think it highly depends on
Speaker 1: you know what that looks like. A short term correction
Speaker 1: is fine from an economics perspective. You know, yes, we
Speaker 1: get a little bit hit to confidence, but the link
Speaker 1: in to the economy is fairly limited. But a sustained
Speaker 1: one obviously would be problematic. Bushell Meyer's secretary of and
Speaker 1: we'll have to deal with what seemed to be big
Speaker 1: fiscal packages. Does a marginal hundred billion matter? I mean,
Speaker 1: Ethan Harrison, you are wonderful at this. I mean, we
Speaker 1: talked about trillions in the drama of what we say,
Speaker 1: But do you nuance a hundred billion here, a hundred
Speaker 1: billion there? Yeah? Um, you know, the uh the support
Speaker 1: to the economy from fiscal stimula. Right now, Obviously it's
Speaker 1: been extreme the dollars I've been pumped into the into
Speaker 1: the economy, but we would argue that it was necessary
Speaker 1: and probably will continue the necess very. Ultimately that leads
Speaker 1: to a higher deficit, which at some point in time
Speaker 1: the road will be problematic. But I don't think it's
Speaker 1: it's an issue that policymakers are paying too much attention
Speaker 1: to right now, and I would think that that that
Speaker 1: sentiment will be continued as Treasury and the said for
Speaker 1: the next years until the economy has fully deals. Thanks
Speaker 1: so so, I thanks so much, Michelle, greatly greatly appreciate that.
Speaker 1: Right now, folks, this is the most conversation, the most
Speaker 1: important conversation of the day on the mental foundation of
Speaker 1: the market. And let's not mince words, it's founded on
Speaker 1: one stock. We speak to Daniel Ives on what was
Speaker 1: wrought in Cupertino. He's with web Bush. Dan Ives, you've
Speaker 1: left it up two hundred and sixty dollars a share
Speaker 1: an Apple, and I want you to talk about your
Speaker 1: core belief that they will innovate, and Dan Ives, I
Speaker 1: want to go to the latest incarnation the M one chip,
Speaker 1: and folks, I'm not because the time, I'm not going
Speaker 1: to go into this. The M one chip is getting
Speaker 1: rave reviews and the technology zeitgeist. Dan ives, how do
Speaker 1: they do that? That's where the magic happens. And if
Speaker 1: you look at what they've done from the innovation, I
Speaker 1: think M one is a good example. That's a shot
Speaker 1: across about Intel and the semiconductor industry in terms of
Speaker 1: Apple controlling more and more of their ecosystem. And I
Speaker 1: think what you've seen in the stock and you're seeing
Speaker 1: in the innovation really across the whole food chain Apples
Speaker 1: continuing to flex their muscles and expanded more and more,
Speaker 1: especially with the supercycle now a reality playing out. But
Speaker 1: the great great miscall of the Apple gloom crew, Dan Eyes,
Speaker 1: has been the innovation is going to end. And the
Speaker 1: fact is the M one it appears, I'm speaking as
Speaker 1: an amateur, looks like a ball over the wall, over
Speaker 1: the turnpike, over the cask and flagon as well, Dan Eyes,
Speaker 1: that's red Sox talking case you know it. The bottom
Speaker 1: line is, Dan is what is in the pixie dust
Speaker 1: that gives you confidence that they can continue to innovate? Well,
Speaker 1: do a step back into golden and scaled. These the
Speaker 1: best consumed products company in the world. That penetration, we've
Speaker 1: seen it with AirPods, weaving AirPods over nine this year
Speaker 1: you're seeing with the M one ship, and then ultimately
Speaker 1: the next few years we see them partnering on e
Speaker 1: V with the likes of a Volkswagen or hun they
Speaker 1: potentially at Tessa. It just speaks to why our opinion
Speaker 1: a year from now we're looking at a three trillion
Speaker 1: dollar stock for Apple as this all plays out, Remember
Speaker 1: what the haters will hate, but they continue to innovatag
Speaker 1: think evil will see over the next month as they
Speaker 1: continued execute China, that continues to be the win of
Speaker 1: the growth. You have, guys, have no idea. When the
Speaker 1: haters hate, what it means they're danny. Is the garbage
Speaker 1: you get some people anti Apple is well? Is you
Speaker 1: model out a hundred and sixty target and then you
Speaker 1: extrapolate out. I mean three trillion is unimaginable to those
Speaker 1: of two trillion or way back at one trillion as well.
Speaker 1: What are your linear functions look out five years, ten
Speaker 1: years out for Coupertino. Yeah, first to services business. I
Speaker 1: think over the next three to four years. That could
Speaker 1: be worth upwards of two trillions. That services piece of
Speaker 1: loon you know, with which of you, with that trajector
Speaker 1: that continues to be a big part of the rereading.
Speaker 1: Then you look at the golden iPhone hardware ecosystem, I
Speaker 1: think that could be worth you know upwards down your
Speaker 1: heard another's two trillions of three trillion. That's why I look,
Speaker 1: this is a company right now still in the middle
Speaker 1: innings of a renaissance of growth and the supercycle that
Speaker 1: continues to be in fifth gears we're seeing play out.
Speaker 1: What is the impact? I mean, you mentioned the iPhone
Speaker 1: and folks full disclosure, another white bag went through the
Speaker 1: damn door yesterday at home. I mean somebody in the
Speaker 1: house is buying another piece of apple to keep dan
Speaker 1: I's live going. But Dan, what happens if they redo
Speaker 1: and innovate iMac or other products? I mean is that
Speaker 1: in your Excel spreadsheet? I think that's all incremental And ultimately,
Speaker 1: if you look, especially what we see with m one
Speaker 1: ship and some of the other innovation happening in the
Speaker 1: hall of the Croupertino, you further further monetize that that
Speaker 1: just adds to the overall ecosystem for Apple. And that's
Speaker 1: why right now, that is just further monization of that
Speaker 1: install base. Do you agree they should do an automobile? Mean,
Speaker 1: why should they do an automobile if it ain't broke,
Speaker 1: don't fix the model. Well, for e v S we'll
Speaker 1: talk about a trillion dollar market. They're not going to
Speaker 1: be making the automobiles themselves. We believe they partner. We
Speaker 1: talked about b W Hundai, Castle Potentiary, Domler. That's the opportunity.
Speaker 1: You can have the biggest consumer products company looking to
Speaker 1: E d from the outside looking in. It's very simple
Speaker 1: what we've seen with bay Do in China. A golden
Speaker 1: age for e v S. Apples going to dive into
Speaker 1: the deep end of the bowl. Danna, if you played
Speaker 1: by the rules as the securities analyst after the joy,
Speaker 1: you've got that paragraph special risks. What's the risk for
Speaker 1: Mr Cook? The risk for Cook it's China and us
Speaker 1: that cold tech board there the poster child. If you
Speaker 1: don't see a ratching down with Biden administration, that would
Speaker 1: be a risk to Apple both supply chain as well
Speaker 1: as the man and of course regulatory I mean that's
Speaker 1: going to continue be a big tech battle, just real
Speaker 1: quick here, Dan Eyes. Then if we get troubles with China,
Speaker 1: what does that do as a percent basis on free
Speaker 1: caslow growth or revenue growth? How do you quantify that
Speaker 1: effect of trouble with China? iPhone demands China and that,
Speaker 1: and you start to play with the map there, you
Speaker 1: could start to see anywhere from three to five percent
Speaker 1: downside to bowl case numbers. And of course supply chain.
Speaker 1: Remember they bet the horse in terms of the fox
Speaker 1: comes without supply chain disruptions. That's why Apple is so keenough,
Speaker 1: the poster child for US China cold tech war. What
Speaker 1: are we gonna see when they report? I mean, they
Speaker 1: come out of the holiday season absolutely unique. I mean
Speaker 1: the pandemics made it original. What's your guestimate of that
Speaker 1: earnings called? I mean, I think this is going to
Speaker 1: be a blockbuster, the Bonde Smith type quarter, and I
Speaker 1: think you're gonna see more and more numbers continue to
Speaker 1: move up. And that's when the streets continuing to underestimate.
Speaker 1: In my opinion, Dan, I'm gonna leave it there because
Speaker 1: I've got a reset for an impeachment. Daniel ives with
Speaker 1: some terrific work from wed Bush This on Apple Computer.
Speaker 1: Thanks for listening to the Bloomberg Surveillance podcast. Subscribe and
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