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Speaker 3: A lot to get to. We want to bring in
Speaker 3: Max Chafkin, senior reporter at Bloomberg business Week, co host
Speaker 3: of the Everybody's Business and Elon In podcast so much more,
Speaker 3: a very close follower of all things Elon. You've been
Speaker 3: listening along with us. Elon kind of not leaving though, no,
Speaker 3: not leaving.
Speaker 4: And you know, I think those of us who follow
Speaker 4: us closely kind of expected this to some extent. I mean,
Speaker 4: Trump signaled it last night in his post on truth
Speaker 4: Social Also, you know, for all this talk of Elon
Speaker 4: getting pushed out or making his exit, we've seen those headlines.
Speaker 4: There have sure been a lot of events at the
Speaker 4: White House or at Trump related things over the last month.
Speaker 4: They brought up the presidential travel musk joining Trump on
Speaker 4: this tour in the middle East. We've also seen these
Speaker 4: kind of valedictory This isn't even the first valedictory kind
Speaker 4: of appearance. There was a cabinet meeting I believe last month.
Speaker 4: The thing is Trump needs Elon Musk. The Republicans need
Speaker 4: Elon Musk. He was the most the biggest donor to
Speaker 4: Republican candidates or Republican campaigns in the twenty twenty four cycle.
Speaker 4: They are certainly counting on him in the twenty twenty
Speaker 4: six cycle and having him on side, having him a
Speaker 4: part of this, having this show of unity is helpful
Speaker 4: to the president in helping to bring Republican members of
Speaker 4: Congress around to you know, to pass the big beautiful
Speaker 4: bill or anything else, you know. On the other hand,
Speaker 4: Musk also needs Trump. He for all the reasons that
Speaker 4: made him an enthusiastic supporter of Donald Trump. I mean,
Speaker 4: SpaceX is a large government contractor, Tesla is a highly
Speaker 4: regulated company. It goes on and on. Having this close
Speaker 4: relationship is very valuable. So I think it's in both
Speaker 4: their interests to keep this going. It is clear though
Speaker 4: that Elon Musk's kind of connection to Doge, and I
Speaker 4: think to a greater extent, the kind of prominence of Doge.
Speaker 4: The vision of Doge is this kind of Elon Musk
Speaker 4: driven maximalist for netic getting in there and breaking stuff
Speaker 4: that feels like it's sunsetting.
Speaker 3: And to be fair, there have been numbers put out
Speaker 3: by the administration and others about you know, I think
Speaker 3: Elon specifically said that he still expects to hit that
Speaker 3: I think a trillion dollars in cuts over the years
Speaker 3: or something, some large numbers. But the point is everybody's
Speaker 3: done a lot of reporting, including Bloomberg that really questions
Speaker 3: some of the numbers that have been out there and
Speaker 3: what ultimately they will achieve in terms of cuts. Yeah.
Speaker 4: Well, and even if you take what he said right,
Speaker 4: it's a trillion dollars over an undefined time period. A
Speaker 4: big difference from where Elon Musk was, you know during
Speaker 4: the campaign when when during an event with Howard Lutnik
Speaker 4: he said two trillion a year that was then downgraded
Speaker 4: to one trillion. And and so, you know, by his
Speaker 4: own admission, and I think anyone who.
Speaker 3: Was familiar with the working of the federal government.
Speaker 4: Could have told him this. There were experts certainly at
Speaker 4: the time saying this is going to be very hard
Speaker 4: you know that that was probably an unrealistic goal. Of course,
Speaker 4: Elon Musk is all about unrealistic goals, right, That's kind
Speaker 4: of his thing. He likes He even by his own account,
Speaker 4: you know, likes to set these audacious goals. You know,
Speaker 4: even if you fall short, even if you're a little late,
Speaker 4: it's still impressed.
Speaker 3: If you get a black guy for me five year seven.
Speaker 4: Yeah, he's going to argue that, you know, one hundred
Speaker 4: and sixty billion, which is the claimed figure, is significant.
Speaker 3: It's it's not a small number.
Speaker 4: It's just it's just so far off from where they
Speaker 4: were and when you look at you know, the deficit
Speaker 4: projections from even from this latest spending bill, right, it's
Speaker 4: not a huge number.
Speaker 5: And Musk even pointed out that he wants to focus
Speaker 5: more on his businesses. I mean, if you're looking at
Speaker 5: Tesla's stock down close to thirteen percent a year to date.
Speaker 5: But Trump said himself that Musk will be back and forth.
Speaker 5: So how would shareholders and investors in his companies feel
Speaker 5: about this?
Speaker 4: He's what Elon Musk is walking a line here, and
Speaker 4: it's even there's even sort of some kind of contradictions
Speaker 4: within the movements of the share price, because of course,
Speaker 4: the stock went crazy up after Trump was elected. The
Speaker 4: story we heard back then was, well, the stock is
Speaker 4: going up because Elon Musk is going to have all
Speaker 4: this access, and then we reached a point where the
Speaker 4: stock went up started trading up because Elon Musk said
Speaker 4: he was stepping away. Now I think the truth is
Speaker 4: Tesla investors are very much on board with pretty much
Speaker 4: whatever Elon Musk says. They believe that this is a
Speaker 4: shareholder base that is different from most publicly traded companies.
Speaker 4: There is a level of belief in the CEO that
Speaker 4: is greater than a normal company. They are trusting that
Speaker 4: Elon Musk can walk a line that he can simultaneously
Speaker 4: focus on all these companies. He's bringing five companies at
Speaker 4: the same time while maintaining his role as we heard
Speaker 4: just now as an advisor.
Speaker 3: I mean, there was a little bit of a shift there.
Speaker 4: You heard a question about is he going to be
Speaker 4: involved twenty four to seven with sum It was a
Speaker 4: claim that Elon Musk made on Twitter just.
Speaker 3: A few days ago. Elon Musk didn't.
Speaker 4: Respond to that directly, but he did say I will
Speaker 4: continue to be an advisor and a friend. I hear that,
Speaker 4: and I think this is you know, this relationship as
Speaker 4: we you know, as we heard from the President and
Speaker 4: from Elon Musk, it will continue.
Speaker 3: Really fascinating stuff. Max, thank you so much, really appreciate
Speaker 3: Max Chaffkins, Senior reporter at Bloomberg business Week, co host
Speaker 3: of the Everybody's Business and Elon Inc. Podcast. Check it
Speaker 3: out because they really do follow the day to day
Speaker 3: gyrations of all things Elon.
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Speaker 3: We did hear from President Trump just from the Oval Office.
Speaker 3: He did say he expected to speak to Chinese President
Speaker 3: Xi ximping after accusing China of violating in agreement with
Speaker 3: the United States to East tariff. So we did see
Speaker 3: kind of a ratcheting up of tensions between the world's
Speaker 3: two largest economies that was initially putting pressure on some
Speaker 3: of the trade. But it didn't seem that some of
Speaker 3: that eased as we did hear a comment out of
Speaker 3: the White House saying that he expected to actually speak
Speaker 3: to the Chinese president. But I have to say geopolitically,
Speaker 3: so much going on. We've got the strained and evolving
Speaker 3: US China relationship, the Russia Ukraine War, how that may end,
Speaker 3: when it will end, the Middle East, Israel and Hamas,
Speaker 3: Greenland and more. Everyone is kind of looking at maybe
Speaker 3: what is the new global world order going forward? And
Speaker 3: eighty years later, it's hard not to wonder if the
Speaker 3: world has really kind of headed toward another Yaulta conference
Speaker 3: and a carving up of our world. Our next guest
Speaker 3: actually wrote about it Fornerfairs magazine that caught our attention.
Speaker 3: It's great to have with us. Monica Tuft. She's professor
Speaker 3: of International Politics at the Fletcher School at Tufts University.
Speaker 3: She's taught at Oxford University's Blovotnik School of Government, Harvard
Speaker 3: University's jfk School of Government, and she spent four years
Speaker 3: in the US Army as a Russian linguist. And she
Speaker 3: joins us from Medford, Massachusetts. Monica, great to have you
Speaker 3: here with us. How are you.
Speaker 6: I'm terrific. Thanks for having me.
Speaker 3: Carol and Jess, Well, it's good to have you here.
Speaker 3: There's so much coming at us domestically, but also continually geopolitically.
Speaker 3: The President just talking about various parts of the world,
Speaker 3: whether it's Russia, Ukraine, whether it's about China and trade
Speaker 3: just from the Oval Office. Is the world about to
Speaker 3: be carved up in a new way, just like we
Speaker 3: saw after World War Two?
Speaker 6: It's a question still. I think we have to watch it.
Speaker 7: I did write this piece, and it's a speculative piece
Speaker 7: in the sense of using history basically, of looking at
Speaker 7: prior history to try to understand and what's happening. We
Speaker 7: do seem to be in a liminal moment right now
Speaker 7: where you have leaders who are talking about expansive aims.
Speaker 7: And when I talk about expansive aims, it's not only economically,
Speaker 7: but it's politically. So you have President Trump coming in
Speaker 7: and talking about Greenland, maybe it would be nicely Greenland
Speaker 7: to be part of the United States Canada and then
Speaker 7: taking control over the Panama Canal. And then you have
Speaker 7: Russian President Vladimir Putin actually going in and taking Crimea
Speaker 7: and then four other provinces. And then of course we
Speaker 7: know China's president she would love to reacquire Taiwan, and
Speaker 7: they seem to be in a position right now politically
Speaker 7: to be able to talk about this and you know,
Speaker 7: this kind of language of expanding their nations geographically, and
Speaker 7: each of them seems to have sort of ideas that
Speaker 7: this is somewhat desirable. So the question is whether they
Speaker 7: succeed right Putin is not succeeding right now. Taiwan has
Speaker 7: not made a I mean, China has not made a
Speaker 7: play for Taiwan. And President Trump it's not clear that
Speaker 7: he has the capacity or the full design to take
Speaker 7: great Land Canada, so it's a question mark.
Speaker 6: Still.
Speaker 3: Well, this concept of professor toft of spears of influence
Speaker 3: or spear of influence not a new one. It's been around,
Speaker 3: they change, right, So I don't know if we think
Speaker 3: about a new carving up, is it a good thing
Speaker 3: or a bad thing or tbd.
Speaker 7: I think it depends upon your perspective. So for the
Speaker 7: states that are managed to in the statesmen that manage
Speaker 7: to establish a new sphere of influence, it.
Speaker 6: Could be a good thing.
Speaker 7: But for the states that are sort of gobbled up
Speaker 7: within that sphere, it's not such a great thing because
Speaker 7: basically those larger countries, what they're doing is they're using
Speaker 7: their advantages in military power, military might, economic leverage, and
Speaker 7: diplomacy right to secure those spheres of influence, get control
Speaker 7: of those geographic areas in order to exert more control economically,
Speaker 7: militarily without necessarily exercising formal sovereignty. And the question is
Speaker 7: is over time, are they benign so do they do
Speaker 7: good right? Will they help develop up the countries that
Speaker 7: they sort of move into, or are they maligned?
Speaker 6: They are they repressive? Generally speaking?
Speaker 7: When we were living in the world between nineteen forty
Speaker 7: five and let's say nineteen ninety one, during the Cold
Speaker 7: War period, we had the liberal West right and that
Speaker 7: was one block, and that was our sphere with Western Europe,
Speaker 7: and then you had this sort of Warsaw Pact, and
Speaker 7: within the Warsaw Pact that was considered the Soviet Union sphere,
Speaker 7: and it didn't go so well for the East Europeans,
Speaker 7: which is why today or in the post nineteen ninety period,
Speaker 7: the post Cold War period, many of those Eastern European
Speaker 7: countries try to get into the Western side, right, into
Speaker 7: the West sphere, and the United States was the great stabilizer.
Speaker 7: What's kind of tossed this all up in the air
Speaker 7: at this point is two things. The first factor is
Speaker 7: Russian President Vladimir Putin going into Ukraine and actually using
Speaker 7: force to do that. And then secondarily you now have
Speaker 7: a US president talking in these expansive terms about possibly
Speaker 7: expanding United States territory. So so it does seem to
Speaker 7: be a situation where there is change, uh, you know,
Speaker 7: afloat uh. And and whether it's a good or bad thing,
Speaker 7: it's a it's I think we need to suspend judgment.
Speaker 7: But I will tell you it tends not to be
Speaker 7: a good thing. In fact, I could have you know,
Speaker 7: titled the piece spheares of war, right, because what happens
Speaker 7: is you get up into those buffer areas between where
Speaker 7: the different spheres rub up against one another, and who
Speaker 7: gets to control what part?
Speaker 6: How deep do you go into each other's sphere of influence?
Speaker 5: How does China play into this?
Speaker 7: It's a great question. And the thing is is, if
Speaker 7: you think about President She, he's very conservative in his movements.
Speaker 4: Right.
Speaker 7: Basically, the President She wants to keep the Chinese economy,
Speaker 7: economy humming, right, so he has to keep the middle
Speaker 7: class happy, keep the jobs, make sure that the real
Speaker 7: estate market doesn't collapse. And so for him, the economy
Speaker 7: is everything, because it's the legitimacy in which the Communist
Speaker 7: Party and President She built his power. On the other hand,
Speaker 7: you have this thing looming in the background, which is nationalism.
Speaker 7: And Chinese, just like the Americans, there's nationalism and they
Speaker 7: believe that Taiwan is part of Chinese territory. And when
Speaker 7: you've got another major power of the United States supporting Taiwan,
Speaker 7: which the Chinese see is theirs, that leads to tensions.
Speaker 7: And so the Chinese, on the one hand, under President
Speaker 7: She recognized that war is very costly. We understand that
Speaker 7: war can be quite costly. Yet on the other hand,
Speaker 7: there's these impulses that they need to expand economically. Oh
Speaker 7: and by the way, politically national In terms of nationalism,
Speaker 7: it would be nice to reacquire some territories that they
Speaker 7: see as rightfully their own.
Speaker 3: We are talking with Monica Toft. She's professor of International
Speaker 3: politics at the Fletcher School at Tufts University. We're talking
Speaker 3: about an article that she has written for Foreign Affairs
Speaker 3: entitled the Return of Spheres of Influence. Monica, I want
Speaker 3: to Professor Toft, I want to relate it to the
Speaker 3: Bloomberg audience and I think about every story, there is
Speaker 3: I feel like a money component to it, right, a
Speaker 3: market component, economic component. So if indeed we are seeing
Speaker 3: up a new carving up and as you said, you know,
Speaker 3: it depends on kind of how it gets carved up.
Speaker 3: But should we assume that there are implications then for
Speaker 3: financial markets, for economies. And I do think about this
Speaker 3: US exceptionalism where it seems to be waning. We're talking
Speaker 3: about that a lot more today than at the beginning
Speaker 3: of the year January first, when we talked about US
Speaker 3: exceptionalism rating supreme and that applied to financial markets.
Speaker 6: Yeah, I mean it does.
Speaker 7: It does matter quite a bit for the economy and
Speaker 7: for trade and few exceptionalism. And I think what's happening
Speaker 7: the under the Trump administration is they're sort of tossing
Speaker 7: that exceptionalism further up.
Speaker 6: In the air.
Speaker 7: Right, So you know, we do have sort of now
Speaker 7: competing powers. China has risen economically, and what's so interesting
Speaker 7: about the Chinese case is the United States helped that
Speaker 7: through the nineteen nineties and early two thousands until all
Speaker 7: of a sudden we have the crisis in two thousand
Speaker 7: and eight and China and actually both China.
Speaker 6: Under She and Russian President.
Speaker 7: Putin look at that two thousand and eight crisis and
Speaker 7: think maybe that Western capitalism isn't so great, maybe the
Speaker 7: American dollar isn't as secure as we thought it was.
Speaker 6: And so they started, you started.
Speaker 7: Seeing sort of the decoupling and trying to sort of
Speaker 7: vary out and diversify their economies a little bit more so.
Speaker 6: Economics is absolutely critical to this story.
Speaker 7: But I think, you know, it's interesting. I'm now, you know,
Speaker 7: talking to people about political risk. It used to be
Speaker 7: geoeconomic risk, right, and now people are thinking, wow, politics
Speaker 7: really matter, And I'm thinking, of course they do.
Speaker 6: I'm a political scientist by training.
Speaker 7: But when you have leaders making major decisions about tariffs
Speaker 7: and trade and who the rival is, right, then you're
Speaker 7: going to have changes in the economic market.
Speaker 3: We'll leave a couple of minutes left. I want to
Speaker 3: ask you if, indeed, when we see some end to
Speaker 3: the Russia Ukraine war, if Ukraine has to give back
Speaker 3: or let go of some territory, and that is certainly
Speaker 3: seen as another win in terms of President Putin expanding
Speaker 3: his territory again after that initial annexation of Crimea. That
Speaker 3: sends a very big message right to the world in
Speaker 3: terms of great powers being able to take land.
Speaker 7: Yes, what it does is it validates the use of force, right,
Speaker 7: So it basically says, if you use force, then potentially
Speaker 7: you're going to be able to keep the territory that you.
Speaker 6: Have actually conquested and now occupy.
Speaker 7: But you know what I want to do is I'd
Speaker 7: love for the audience to think about sort of extending
Speaker 7: their time horizons.
Speaker 6: So in the shorter term of the.
Speaker 7: Medium term, it may be the case that Ukraine may
Speaker 7: have to modify some of its territorial you know construct
Speaker 7: right that the nature and the size of the state.
Speaker 7: But over the longer term, you know, Putin is not
Speaker 7: going to be in power the whole time. You may
Speaker 7: not have such sort of a hypernationalist in power, and
Speaker 7: Ukraine may be able to renegotiate or get that territory back,
Speaker 7: maybe by having a referendum down the road and having
Speaker 7: some you know, proper electoral processes that allow the Crimeans
Speaker 7: and then those four provinces the folks there. So it
Speaker 7: doesn't necessarily have to be seen as a done deal.
Speaker 6: Yes, in the moment, and would be quite painful.
Speaker 7: Again, I was talking about Chinese nationalism right, Ukrainians and
Speaker 7: nationalists right, This is going to be very painful right
Speaker 7: for the country. So yes, you know, Ukraine could be
Speaker 7: left in a rump state, but what I'd say is
Speaker 7: over the longer term they may be able.
Speaker 6: To get that territory back. It's happened before historically.
Speaker 3: So it's interesting. I mean political changes in governments, whether
Speaker 3: it's Russia, the United States, China. I mean, these things,
Speaker 3: as you say, kind of are going to impact things
Speaker 3: more longer term. Monica, Thank you so much. Monica Talk,
Speaker 3: Professor National Politics at the Fletcher School at Tufts University,
Speaker 3: joining us from Medford, Massachusetts.
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Speaker 3: Heky everybody just about eighteen minutes, coming up on the
Speaker 3: close on this Friday, wrapping up the day and the
Speaker 3: trading week overall. Just heard from Bill and Charlie. We're
Speaker 3: definitely I said a rally, but I met earlier like
Speaker 3: rally off our lows, but we're still just down about
Speaker 3: two points on the S and P five hundred and
Speaker 3: just down about forty three on the NAWS DEAK one hundred,
Speaker 3: but much more positive than we were earlier in the session.
Speaker 5: That's right, and it looks like the S and P
Speaker 5: five hundreds still on course for its best May since
Speaker 5: nineteen ninety carousel. We'll see if that can hold through
Speaker 5: four PM.
Speaker 3: Thirty five years. That's a long time, all right, Let's
Speaker 3: get to it. Tyler Rosinlicht is with US portfolio manager,
Speaker 3: head of natural resource equities at the publicly held investment
Speaker 3: from Cohen and Steak years. He is here in our
Speaker 3: Bloomberg Interactor Broker studio. Keep in mind the firm has
Speaker 3: about eighty seven billion in assets under management. Tyler, you
Speaker 3: mentioned you reminded me it's been a while. Good to
Speaker 3: have you back. Just let's start broadly, big picture, your
Speaker 3: investment thesis and focus. Talk to us a little bit
Speaker 3: about it, especially against the backdrop of you know, every
Speaker 3: day we're following news out of Washington and what kind
Speaker 3: of impact that has in policy and ultimately industries and
Speaker 3: corporate earnings.
Speaker 1: Well, thanks so much for having me. I guess there's
Speaker 1: kind of two pieces that I can talk about. One
Speaker 1: is the infrastructure side and one is natural resource equities,
Speaker 1: and I think both of them are really well positioned today.
Speaker 1: You know, I'd start with infrastructure. You know, I think
Speaker 1: there's a lot of uncertainty out there, and every day
Speaker 1: we wake up to new news that's causing a lot
Speaker 1: of concern.
Speaker 8: Right.
Speaker 1: What we like about infrastructure is it's really predictable, you know.
Speaker 1: We think about it as a lower volatility downside protected
Speaker 1: asset class. It's the stuff that you have to pay
Speaker 1: for as a consumer. It's what helps make the economy run.
Speaker 1: So we've seen a lot of interest in infrastructure, and
Speaker 1: it's very sensible to us.
Speaker 3: You have a lot of energy companies in that fund specifically.
Speaker 1: So within infrastructure, it's just utilities and then pipeline companies.
Speaker 1: For us, it's really the present is truly the infrastructure,
Speaker 1: just the infrastructure. Now we have natural resource equities as well,
Speaker 1: which invests across the energy value chain, metals and mining
Speaker 1: and agribusiness. That's also seeing a lot of interesting things today,
Speaker 1: just given all the volatility that we have.
Speaker 5: So how do you read with everything going on with
Speaker 5: the economic data to the back and forth with the
Speaker 5: trade headlines. How do you use those types of stories
Speaker 5: to then try to figure out what the best investment
Speaker 5: thesis is.
Speaker 1: Yeah, let's start with infrastructure. So one of the unique
Speaker 1: things about it as an asset class is the risk
Speaker 1: that really keeps us up at night is regulatory risk
Speaker 1: and changes to regulation, changes to policy that can be
Speaker 1: on the national level. Are we going to potentially privatize Amtrak?
Speaker 1: What that could that mean for us as investors? Or
Speaker 1: on the more local level, so is the Utility Commission
Speaker 1: going to change the rules of the game or the
Speaker 1: returns for a local utility? So our focus a lot
Speaker 1: more nuclear are allow more nuclear, which we're really excited
Speaker 1: and bullish on.
Speaker 3: So seeing the President on some executive orders to wrap
Speaker 3: that up in the.
Speaker 1: Yeah, I'm tuss that's really a good thing. Like we
Speaker 1: think we're in an energy deficit globally, we think there's
Speaker 1: this tension between trying to find decarbonization efforts but also
Speaker 1: have predictable baseload energy. Nuclear to us is a great example.
Speaker 1: It's going to require a lot of government support and
Speaker 1: so making sure that we can understand what's going on
Speaker 1: from a policy perspective is what's going to drive investment
Speaker 1: opportunities for US?
Speaker 3: I am curious in this fund. I'm just looking at
Speaker 3: year to date. I think it is up. I'm just
Speaker 3: looking at here. Is it up? About? Why am I
Speaker 3: not seeing this number?
Speaker 8: Probably kind of like mid single digits? Called it seven
Speaker 8: or eight percent?
Speaker 3: Yeah, okay, Well, I just think about in terms of
Speaker 3: the market volatility that we've been seeing, is it have
Speaker 3: you been adding? Have you been subtracting? Like I'm just
Speaker 3: curious how like moving in and out?
Speaker 1: So I'd start with the investor appetite. We've definitely seen
Speaker 1: a lot of investor interest in infrastructure in particular. Again,
Speaker 1: certainty is really high, and folks are looking for ways
Speaker 1: to get equity like returns but with a little bit
Speaker 1: less volatility, and that's what infrastructure does. Clearly, sort of
Speaker 1: there's a lot of news out there on we need
Speaker 1: more infrastructure development, how do we finance that? And listed
Speaker 1: companies in particular benefiting for US. I'd say we've been
Speaker 1: somewhat defensively positioned. We think sort of there's concerns around
Speaker 1: the macroeconomy, things like freight rail volumes and so forth
Speaker 1: are a little bit less predictable. So we've definitely moved
Speaker 1: I'd call it like a four and a half or
Speaker 1: five on a zero to ten scale in terms of
Speaker 1: risk on risk off, which is just kind of balanced.
Speaker 1: There's some concerns out there, but we're not super concerned,
Speaker 1: and we just are trying to find the right stocks
Speaker 1: and sectors today.
Speaker 5: What do you think of the hottest picks within infrastructure
Speaker 5: if you're looking kind of more within groups or maybe
Speaker 5: more specific companies that are listed.
Speaker 1: Yeah, nuclear to us is really interesting. You know, we
Speaker 1: invest in.
Speaker 3: That everybody's kind of energy the utility because of the data,
Speaker 3: you know, I'm thinking about all the AI and the
Speaker 3: data and the energy needs or was that more it
Speaker 3: seemed to kind of supercharge it, if you will, But
Speaker 3: I'm just curious if it was kind of circulating anyway.
Speaker 8: I think that's part of it.
Speaker 1: But it goes a little bit beyond that, which is,
Speaker 1: we think the world needs more energy, and we want
Speaker 1: energy that is, you know, good for the environ mint.
Speaker 3: But we all see the nuclear waste well for sure,
Speaker 3: for sure.
Speaker 1: We went to figure that one out, but we also
Speaker 1: want it that's predictable and what we call baseload you
Speaker 1: know the problem with a lot of renewables is that
Speaker 1: they're intermittent, and when the sun's not shining, the wind's
Speaker 1: not blowing, they don't produce power. Guess what if you're
Speaker 1: a data center CEO, that's a big problem. You need
Speaker 1: to make sure that the powerms stay on. So nuclear
Speaker 1: to us is like the one resource that serves both masters.
Speaker 1: It is decarbonized. Yes, there's a spent uranium with which
Speaker 1: to deal with, but it's also baseload. It runs at
Speaker 1: very high capacity factors at very low variable costs, and
Speaker 1: I think people are saying, hey, we know we need
Speaker 1: the energy. This is the sort of best of the worst,
Speaker 1: if you want to think about it that way, And
Speaker 1: that's why it's coming back in vogue.
Speaker 5: What about commodity investors, because I know you're looking at
Speaker 5: kind of the performance of real assets now versus how
Speaker 5: they would have been the last decade.
Speaker 1: Yeah, we're really excited about the commodity cycle, and we're
Speaker 1: really excited about the natural resource equity cycle as well.
Speaker 1: I mean, we've thought about it as we've exited this
Speaker 1: period of abundance, which was kind of the two thousand
Speaker 1: and seven A twenty twenty period, and we've entered what
Speaker 1: we call the air of scarcity. Elite demand for commodities
Speaker 1: and materials is pretty strong. We've underinvested in the supply
Speaker 1: side for a really long time. Commodity producers, you know,
Speaker 1: if you can find the right ones that aren't going
Speaker 1: to sort of miss in terms of their production profiles,
Speaker 1: they're really cheap, and we think marginal costs for what
Speaker 1: they produce are going to rise and that's going to
Speaker 1: be good for them.
Speaker 5: Son if it's more Canadian investors or US if you're
Speaker 5: looking at the commodities aspect, it.
Speaker 1: Really depends on the commodity you're talking about and sort
Speaker 1: of the investment. Like, for instance, take oil. We're actually
Speaker 1: pretty bearish oil, but we particularly don't like US shale
Speaker 1: producers because of the depletion right they see massive declines
Speaker 1: and volumes every year. We like the Canadian oil sands
Speaker 1: producers because they produce with a lot less sort of
Speaker 1: base declients.
Speaker 8: So generally speaking, the Canadian.
Speaker 1: Economy is a lot more commodity centric, but I think
Speaker 1: you can find good opportunities in both places.
Speaker 3: Let's talk about a couple of companies you do like
Speaker 3: in particular, and one of them is trp TC Energy Corporation.
Speaker 3: Tell us about this one.
Speaker 1: Yeah, just very broadly speaking, it's an energy natural gas
Speaker 1: pipeline company.
Speaker 8: Very predictable.
Speaker 1: You know, they're ebit that when they say what it's
Speaker 1: going to be at the beginning of the year tends
Speaker 1: to be what it is at the end of the year.
Speaker 1: We think demand for natural gas is going to keep growing.
Speaker 1: We think data centers and everything else are going to
Speaker 1: require more investment in gas pipelines. They've got a really
Speaker 1: good footprint, and they do own some nuclear assets in
Speaker 1: Ontario that we think will sort of see some life
Speaker 1: extensions that could be good for them. But it's a
Speaker 1: very predictable way to play energy infrastructure across North America.
Speaker 3: Canadian company looks like it's up about almost nine percent
Speaker 3: so far year to date. One last one got about
Speaker 3: thirty seconds Waste Connections tickers WCN. This is an American
Speaker 3: company or US company.
Speaker 8: Yeah, it's funny.
Speaker 1: A lot of people don't necessarily think about and environmental
Speaker 1: services as infrastructure.
Speaker 8: We think they are. For us. It's about pricing power.
Speaker 3: It's what businesses to deal with it.
Speaker 1: It is you have to stay the bill and guess
Speaker 1: what they can raise their rates with inflation or better
Speaker 1: than inflation. So for us, we're always on the hunt
Speaker 1: for what businesses have pricing power. We've found that in
Speaker 1: a lot of waste management business over time, and that
Speaker 1: tends to be one that we feel really good from
Speaker 1: a volume perspective as well.
Speaker 3: Yeah, and that name is up almost about fifteen percent
Speaker 3: year to date.
Speaker 5: Wow.
Speaker 3: Yeah, I think about this stuff a lot. No waste
Speaker 3: is like Unfortunately, it's part of our world. You got
Speaker 3: to figure it out. Really good stuff. Thank you so much.
Speaker 3: Good to see you. Yeah, all right, look forward to
Speaker 3: next time. Tyler Rosenlicht, he's portfolio manager head of natural
Speaker 3: resource equities over at Conan Steers, joining us here in
Speaker 3: our Bloomberg Interactive Brokers studio. Folks were coming up on
Speaker 3: ten minutes until we wrap up this trading day. Just
Speaker 3: up my hair on the S and P five hundred
Speaker 3: and you've got a Nasdaq one hundred that's down about
Speaker 3: twenty nine. Carol Mass just betting in. This is Bloomberg
Speaker 3: Business Weekdaily.
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