1 00:00:00,240 --> 00:00:02,440 Speaker 1: This is Bloomberg Wall Street Week. 2 00:00:02,480 --> 00:00:04,400 Speaker 2: I mean may not have an overall recesion, we're having 3 00:00:04,400 --> 00:00:06,680 Speaker 2: a rolling recession to kind of role looks pretty strongly 4 00:00:06,680 --> 00:00:07,640 Speaker 2: it is when it comes to jobs. 5 00:00:07,680 --> 00:00:09,879 Speaker 1: The financial stories that shape our world. 6 00:00:09,960 --> 00:00:13,600 Speaker 2: Three major regional bank failures send shockwaves through the banking system. 7 00:00:13,680 --> 00:00:15,480 Speaker 2: We're all trying to figure out what to make of 8 00:00:15,560 --> 00:00:17,320 Speaker 2: generative AI through. 9 00:00:17,160 --> 00:00:19,280 Speaker 1: The eyes of the most influential voices. 10 00:00:19,440 --> 00:00:22,400 Speaker 2: Welcome down, Doctor Paul Krugman, Ryan Moynihan, a Bank of America, 11 00:00:22,520 --> 00:00:25,320 Speaker 2: Zebra Lair of the Paulson Institute, Glen Hubbard of the 12 00:00:25,320 --> 00:00:26,280 Speaker 2: Columbia Business School. 13 00:00:26,280 --> 00:00:30,120 Speaker 1: Bloomberg Wall Street Week with David Weston from Bloomberg Radio. 14 00:00:30,240 --> 00:00:33,440 Speaker 2: War in Israel takes a pause, the world takes another 15 00:00:33,520 --> 00:00:36,040 Speaker 2: shot at dealing with climate, and we say goodbye to 16 00:00:36,080 --> 00:00:39,480 Speaker 2: two giants, one in diplomacy and the other an investment. 17 00:00:39,880 --> 00:00:43,440 Speaker 2: This is Bloomberg Wall Street Week. I'm David Weston. This 18 00:00:43,560 --> 00:00:46,600 Speaker 2: week's secial contributor. Larry Summers on the legacies of Henry 19 00:00:46,640 --> 00:00:50,280 Speaker 2: Kissinger and Charlie Munger. Johnny Fion of B and P 20 00:00:50,479 --> 00:00:52,800 Speaker 2: Paraba on what his clients are telling him. 21 00:00:52,920 --> 00:00:56,480 Speaker 3: Part of them are expecting actually to access Captain Walkeet. 22 00:00:56,320 --> 00:01:00,120 Speaker 4: At a later time when waits normalized. 23 00:00:59,720 --> 00:01:02,960 Speaker 2: And Joe said of thor equities on the investment opportunities 24 00:01:03,080 --> 00:01:04,240 Speaker 2: in Mexico. 25 00:01:04,120 --> 00:01:07,400 Speaker 5: We think this is another one of those golden opportunities 26 00:01:07,560 --> 00:01:08,080 Speaker 5: where we're. 27 00:01:08,040 --> 00:01:22,960 Speaker 6: For all the global Wall Street watched this week as 28 00:01:23,040 --> 00:01:27,000 Speaker 6: Israel's warld Hamas went on a temporary hiatus as Israel 29 00:01:27,080 --> 00:01:29,800 Speaker 6: stopped its military operations in a deal that brought some 30 00:01:29,880 --> 00:01:31,080 Speaker 6: of the hostages home. 31 00:01:31,600 --> 00:01:34,600 Speaker 7: The approach that we're taken with Israel and quite frankly 32 00:01:34,640 --> 00:01:36,760 Speaker 7: with our partners in the region is working. 33 00:01:36,800 --> 00:01:38,840 Speaker 3: It's getting aid into people that needed. 34 00:01:38,959 --> 00:01:41,640 Speaker 2: And Elon Musk used the opportunity to travel to the 35 00:01:41,640 --> 00:01:44,800 Speaker 2: war zone to counter accusations that his post on X 36 00:01:44,880 --> 00:01:48,240 Speaker 2: was anti Semitic and to offer to help rebuild Gaza 37 00:01:48,480 --> 00:01:49,160 Speaker 2: once things. 38 00:01:48,960 --> 00:01:52,000 Speaker 3: Are over, those who are intentioned motor must be inutralized. 39 00:01:52,120 --> 00:01:54,040 Speaker 3: Then the propaganda west. 40 00:01:53,880 --> 00:01:57,040 Speaker 2: Off the world gathered in Dubai for COP twenty eight 41 00:01:57,200 --> 00:01:59,600 Speaker 2: and the latest efforts to get a move on in 42 00:01:59,680 --> 00:02:03,520 Speaker 2: dealing with climate, with US officials once again expressing hope. 43 00:02:03,600 --> 00:02:09,079 Speaker 8: I'm confident that Copple provided an opportunity both to identify 44 00:02:09,360 --> 00:02:13,080 Speaker 8: the opportunities that this energy transition is providing and to 45 00:02:13,080 --> 00:02:14,799 Speaker 8: build the broad international coalition. 46 00:02:15,040 --> 00:02:17,959 Speaker 2: Even as more than seventy thousand delegates we're talking about 47 00:02:17,960 --> 00:02:21,480 Speaker 2: fossil fuels opiqu plus met in Vienna to review restrictions 48 00:02:21,480 --> 00:02:22,320 Speaker 2: on all production. 49 00:02:22,680 --> 00:02:26,320 Speaker 9: It could be simply that OPEC plus decides to curtail 50 00:02:26,680 --> 00:02:29,040 Speaker 9: supply and we get a bread going back up to 51 00:02:29,080 --> 00:02:30,959 Speaker 9: the low nineties as a result of that. It's a 52 00:02:31,040 --> 00:02:33,239 Speaker 9: question of how much they curtail supply by, but that's 53 00:02:33,280 --> 00:02:34,680 Speaker 9: the biggest risk right now. 54 00:02:34,840 --> 00:02:38,240 Speaker 2: Two towering figures on Global Wall Street said goodbye this 55 00:02:38,280 --> 00:02:42,280 Speaker 2: week as America's foremost diplomat for a generation and more. 56 00:02:42,560 --> 00:02:45,440 Speaker 2: Henry Kissinger left us at the age of one hundred, 57 00:02:45,720 --> 00:02:49,079 Speaker 2: and Warren Buffett's longtime partner, Charlie Munger, passed away at 58 00:02:49,080 --> 00:02:52,560 Speaker 2: age ninety nine. On the economic front, the United States 59 00:02:52,600 --> 00:02:55,639 Speaker 2: continued its strong performance, with GDP growing at a robust 60 00:02:55,760 --> 00:02:58,840 Speaker 2: five point two percent clip. And when you put that 61 00:02:58,960 --> 00:03:02,040 Speaker 2: strong economic perform together with a FED that seems to 62 00:03:02,040 --> 00:03:04,160 Speaker 2: be sickly it may well be done with hiking. Well, 63 00:03:04,200 --> 00:03:06,600 Speaker 2: what you get are some pretty happy markets, as the 64 00:03:06,639 --> 00:03:08,600 Speaker 2: S and P five hundred added another eight tens of 65 00:03:08,760 --> 00:03:11,800 Speaker 2: percent to end the week at forty fifth five ninety four, 66 00:03:11,840 --> 00:03:14,480 Speaker 2: which is above where the Bloomberg Elves Equities and the 67 00:03:14,560 --> 00:03:16,560 Speaker 2: analysts thought we would end up twenty twenty three, and 68 00:03:16,560 --> 00:03:18,560 Speaker 2: by that way above even where they think we're going 69 00:03:18,639 --> 00:03:20,240 Speaker 2: to end up at the end of twenty twenty four, 70 00:03:20,240 --> 00:03:22,919 Speaker 2: which is forty five hundred. The Nasdaq was up four 71 00:03:22,919 --> 00:03:25,079 Speaker 2: tens of percent for the week, while the yield on 72 00:03:25,120 --> 00:03:28,320 Speaker 2: the tenure was down nearly twenty six basis points for 73 00:03:28,440 --> 00:03:30,600 Speaker 2: the week to end at four point two one. For 74 00:03:30,720 --> 00:03:33,040 Speaker 2: her perspective on these markets and what they are telling 75 00:03:33,120 --> 00:03:36,280 Speaker 2: us about investing today, we welcome now Catherine Keating. She's 76 00:03:36,360 --> 00:03:39,560 Speaker 2: bny MELON, Global head of Wealth Management Casin. Welcome back. 77 00:03:39,560 --> 00:03:40,600 Speaker 2: Great to have you back on wallshreet. 78 00:03:40,680 --> 00:03:41,840 Speaker 10: Great to be here, David, thank you. 79 00:03:42,000 --> 00:03:43,640 Speaker 2: So let's start with some of those data. I mean, 80 00:03:43,640 --> 00:03:46,119 Speaker 2: we got some really robust data we talked about this week, 81 00:03:46,160 --> 00:03:48,240 Speaker 2: but it's it's just the latest and quite a few 82 00:03:48,600 --> 00:03:50,960 Speaker 2: series of data that are pretty encouraging with the economy. 83 00:03:51,240 --> 00:03:51,400 Speaker 4: Yeah. 84 00:03:51,440 --> 00:03:53,119 Speaker 10: So the real story in markets has been the month 85 00:03:53,120 --> 00:03:57,120 Speaker 10: of November, obviously, and the market's digesting really four pieces 86 00:03:57,160 --> 00:04:01,040 Speaker 10: of important data. The first one, of course, inflationation continues 87 00:04:01,080 --> 00:04:04,280 Speaker 10: to go down, but we see disinflation broadening. We see 88 00:04:04,280 --> 00:04:06,280 Speaker 10: it in goods, we see it in services, and we 89 00:04:06,320 --> 00:04:09,280 Speaker 10: see it in big ticket items like shelter and automobiles. 90 00:04:09,320 --> 00:04:12,600 Speaker 10: So that's the first thing inflation. Second thing, labor market 91 00:04:12,880 --> 00:04:16,719 Speaker 10: softening a bit. That's a good sign for lower inflation 92 00:04:16,960 --> 00:04:20,520 Speaker 10: as well. We see the unemployment rate drifting up a 93 00:04:20,560 --> 00:04:24,200 Speaker 10: bit three point nine percent, still very low historically, unemployment 94 00:04:24,200 --> 00:04:27,240 Speaker 10: claims drifting up a bit. And then the real news, 95 00:04:27,279 --> 00:04:30,400 Speaker 10: I think was the following the bond market digesting that 96 00:04:31,000 --> 00:04:34,520 Speaker 10: huge move in tenure treasury rates in the month of November, 97 00:04:34,720 --> 00:04:38,840 Speaker 10: sixty basis points down from a four eighty eight down 98 00:04:38,880 --> 00:04:40,279 Speaker 10: sixty to twenty eight. 99 00:04:40,320 --> 00:04:41,840 Speaker 4: That's an enormous. 100 00:04:41,520 --> 00:04:44,520 Speaker 10: Move in financing costs, not just for the federal government, 101 00:04:44,520 --> 00:04:48,320 Speaker 10: of course, but for anyone who borrows consumers with mortgages 102 00:04:48,320 --> 00:04:53,520 Speaker 10: and car loans, local governments, companies, very big news. And 103 00:04:53,560 --> 00:04:55,720 Speaker 10: then the last thing that the market was digesting is 104 00:04:55,760 --> 00:04:59,440 Speaker 10: after three quarters in a row of negative earnings growth 105 00:04:59,440 --> 00:05:01,800 Speaker 10: in the SMP five hundred, we actually had positive earnings 106 00:05:01,839 --> 00:05:05,479 Speaker 10: this quarter, four percent growth, eighty percent of companies beating expectations. 107 00:05:05,480 --> 00:05:07,600 Speaker 10: So the market digested all of that, and you said it, 108 00:05:07,839 --> 00:05:09,040 Speaker 10: we had a rally at everything. 109 00:05:09,400 --> 00:05:10,680 Speaker 2: So I'm going to say I find this a little 110 00:05:10,720 --> 00:05:13,000 Speaker 2: humbling because if you go back to the end of 111 00:05:13,000 --> 00:05:14,920 Speaker 2: twenty twenty two, I'm not sure we would have predicted 112 00:05:15,000 --> 00:05:17,000 Speaker 2: any of this. So why did so many of us 113 00:05:17,000 --> 00:05:17,839 Speaker 2: get this so wrong? 114 00:05:18,520 --> 00:05:20,800 Speaker 10: So, David, as you know, history has taught us that 115 00:05:20,839 --> 00:05:23,159 Speaker 10: when you have inflation in the economy and you have 116 00:05:23,240 --> 00:05:27,360 Speaker 10: the Federal Reserve raising interest rates to slow the economy, 117 00:05:27,760 --> 00:05:30,240 Speaker 10: ninety percent of the time you end up in a recession. 118 00:05:30,640 --> 00:05:31,440 Speaker 4: So here we are. 119 00:05:31,680 --> 00:05:35,240 Speaker 10: We're twenty months in to a very fast and very 120 00:05:35,240 --> 00:05:39,480 Speaker 10: aggressive FED hiking cycle, and there's no recession in sight. 121 00:05:39,600 --> 00:05:40,240 Speaker 4: Why is that? 122 00:05:40,720 --> 00:05:45,880 Speaker 10: I think many people underappreciated the change in two pillars 123 00:05:45,920 --> 00:05:49,719 Speaker 10: of the economy, consumers and large companies. Consumers, of course 124 00:05:49,760 --> 00:05:52,920 Speaker 10: seventy percent of the economy. The consumer balance sheet has 125 00:05:52,960 --> 00:05:56,760 Speaker 10: changed dramatically since the financial crisis. First, consumers are twice 126 00:05:56,800 --> 00:05:59,760 Speaker 10: as wealthy twenty percent wealthy or just since the beginning 127 00:05:59,760 --> 00:06:02,920 Speaker 10: of this decade, thanks to stock markets and real estate appreciation. 128 00:06:03,640 --> 00:06:06,599 Speaker 10: Second of all, they've been borrowing less. The financial crisis 129 00:06:06,640 --> 00:06:09,640 Speaker 10: was a terrible crisis for the consumer. They've been borrowing 130 00:06:09,680 --> 00:06:12,880 Speaker 10: much more prudently. You see ten percent or so of 131 00:06:12,880 --> 00:06:16,040 Speaker 10: their disposable income now going to borrowing costs. That was 132 00:06:16,040 --> 00:06:19,240 Speaker 10: close to fifteen percent before the financial crisis. But the 133 00:06:19,279 --> 00:06:21,839 Speaker 10: most important thing when you look at consumer balance seats 134 00:06:21,920 --> 00:06:26,360 Speaker 10: is two thirds of consumer borrowing is their mortgage. Those 135 00:06:26,400 --> 00:06:29,440 Speaker 10: mortgages have been refinanced at very low rates. They're going 136 00:06:29,520 --> 00:06:32,080 Speaker 10: to stay that way for a while. Corporate America sort 137 00:06:32,080 --> 00:06:34,719 Speaker 10: of the same thing. Big companies before the crisis. They 138 00:06:34,760 --> 00:06:37,600 Speaker 10: would borrow in short term markets commercial paper. Those rates 139 00:06:37,640 --> 00:06:41,000 Speaker 10: are very high. Now companies aren't doing that. Instead, they 140 00:06:41,040 --> 00:06:44,000 Speaker 10: did what consumers did, and they took advantage of low rates. 141 00:06:44,040 --> 00:06:46,599 Speaker 10: In twenty twenty and twenty twenty one, the SMP five 142 00:06:46,680 --> 00:06:51,040 Speaker 10: hundred taking refinancing debt, issuing new debt at low rates 143 00:06:51,160 --> 00:06:54,159 Speaker 10: and terming it four years, five years, six years, ten years, 144 00:06:54,880 --> 00:06:57,520 Speaker 10: and so that has made both the consumer and large 145 00:06:57,560 --> 00:06:59,719 Speaker 10: companies less sensitive to interest rate increase. 146 00:07:00,160 --> 00:07:01,520 Speaker 2: Great to have you back on, Thank you so much, 147 00:07:01,520 --> 00:07:03,320 Speaker 2: says Cosiarkidi of Nymelan. 148 00:07:03,680 --> 00:07:06,560 Speaker 11: We have always thought of foreign policy and economic policy 149 00:07:07,000 --> 00:07:11,040 Speaker 11: as something that has clear cut terminal dates, and that 150 00:07:11,080 --> 00:07:13,120 Speaker 11: you are either in a condition of conflict or in 151 00:07:13,160 --> 00:07:16,680 Speaker 11: a condition of blissful peace in the nineties. If we 152 00:07:16,720 --> 00:07:20,320 Speaker 11: do it properly, we will live in a less dangerous world, 153 00:07:20,400 --> 00:07:23,880 Speaker 11: but one which will never be totally without problems, and 154 00:07:23,920 --> 00:07:27,960 Speaker 11: in which the subtlety of American of American statesmanship in 155 00:07:28,040 --> 00:07:32,640 Speaker 11: adjusting the various balances both political and economic, will be 156 00:07:32,720 --> 00:07:37,480 Speaker 11: severely tested. But if we do it well, it could 157 00:07:37,560 --> 00:07:39,720 Speaker 11: be an extraordinarily creative period. 158 00:07:40,560 --> 00:07:44,600 Speaker 2: Henry Kissinger defined the world of diplomacy for two generations, 159 00:07:44,880 --> 00:07:48,239 Speaker 2: remaking the geopolitical map of Asia and the Middle East. 160 00:07:48,640 --> 00:07:51,760 Speaker 2: A Jewish refugee who fled Nazi Germany for the United States, 161 00:07:52,000 --> 00:07:55,320 Speaker 2: Kissinger returned as a US Army private to serve in 162 00:07:55,360 --> 00:07:58,600 Speaker 2: the Battle of the Bulge. After the war, Kissinger became 163 00:07:58,720 --> 00:08:01,880 Speaker 2: doctor Kissinger when he earned a PhD in political science, 164 00:08:02,080 --> 00:08:05,800 Speaker 2: and then joined the Harvard faculty. When Richard Nixon became 165 00:08:05,880 --> 00:08:09,160 Speaker 2: president in nineteen sixty nine, he appointed Henry Kissinger as 166 00:08:09,200 --> 00:08:12,200 Speaker 2: his national security advisor and used him to open a 167 00:08:12,240 --> 00:08:16,120 Speaker 2: window to China that made the current economic miracle possible. 168 00:08:16,840 --> 00:08:17,760 Speaker 2: To most people. 169 00:08:18,240 --> 00:08:22,200 Speaker 7: In nineteen sixty eight sixty nine, it seemed inconceivable that 170 00:08:22,280 --> 00:08:25,920 Speaker 7: the US could have a relationship with such an extreme, 171 00:08:26,680 --> 00:08:32,480 Speaker 7: zealous regime as Mao Zedong's remember, the Cultural Revolution was 172 00:08:32,960 --> 00:08:37,720 Speaker 7: in full space and most people thought the regime was 173 00:08:37,920 --> 00:08:41,800 Speaker 7: just nots so the very idea of trying to establish 174 00:08:42,040 --> 00:08:45,440 Speaker 7: a relationship was a minority pursuit. 175 00:08:46,320 --> 00:08:49,520 Speaker 2: Kausinger also negotiate a peace treaty between Israel and Egypt 176 00:08:49,840 --> 00:08:53,200 Speaker 2: and a ceasefire with Syria that brought calm to a 177 00:08:53,200 --> 00:08:55,920 Speaker 2: region that had been upended by wars since the end 178 00:08:55,960 --> 00:08:58,960 Speaker 2: of World War Two. Kasinger also played the lead role 179 00:08:58,960 --> 00:09:01,400 Speaker 2: and negotiating an end to the United States involvement in 180 00:09:01,400 --> 00:09:04,520 Speaker 2: a conference in Vietnam, which earned him the Nobel Peace 181 00:09:04,559 --> 00:09:08,280 Speaker 2: Prize in nineteen seventy three. Doctor Kissinger's role in the 182 00:09:08,280 --> 00:09:11,840 Speaker 2: world was not without controversy. He was accused of pursuing 183 00:09:11,840 --> 00:09:15,240 Speaker 2: an illegal military offensive and laois in Cambodia, as well 184 00:09:15,280 --> 00:09:18,280 Speaker 2: as playing a role in coups in Chile and Argentina 185 00:09:18,320 --> 00:09:21,760 Speaker 2: that resulted in repressive regimes. And this is the thing. 186 00:09:21,640 --> 00:09:25,280 Speaker 7: That critics of Henry Kistinger have always struggled with. They've 187 00:09:25,400 --> 00:09:30,440 Speaker 7: been very bad at setting the crimes of the Pinitiate 188 00:09:30,880 --> 00:09:33,480 Speaker 7: in the context of the Cold War. When you see 189 00:09:33,480 --> 00:09:36,000 Speaker 7: it in the context of the Cold War. To realize 190 00:09:36,120 --> 00:09:40,520 Speaker 7: that the war crimes the crimes against humanity being perpetrated 191 00:09:40,559 --> 00:09:43,440 Speaker 7: by communist regimes or at a much larger scale than 192 00:09:43,480 --> 00:09:47,000 Speaker 7: those that were perpetrated by regimes of the right. And 193 00:09:47,040 --> 00:09:49,120 Speaker 7: this is really the important thing one has to bear 194 00:09:49,120 --> 00:09:52,240 Speaker 7: in mind. Henry Kistinger said even before he went into 195 00:09:52,280 --> 00:09:56,920 Speaker 7: government that foreign policy was very often a choice between evils, 196 00:09:57,160 --> 00:09:59,880 Speaker 7: and the job was to try to choose the lesser evil. 197 00:10:00,440 --> 00:10:03,840 Speaker 2: Every president since Nixon turned to Henry Kissinger for advice 198 00:10:03,880 --> 00:10:07,040 Speaker 2: on foreign policy. He was the author of influential books, 199 00:10:07,080 --> 00:10:09,720 Speaker 2: from his first on Europe in the Wake of Napoleon, 200 00:10:09,800 --> 00:10:13,520 Speaker 2: published in nineteen fifty seven, up to Leadership six Studies 201 00:10:13,520 --> 00:10:18,439 Speaker 2: in World Strategies, published last year. Just last month, Henry 202 00:10:18,520 --> 00:10:21,520 Speaker 2: Kissinger appeared to give a speech at the annual Al 203 00:10:21,600 --> 00:10:24,600 Speaker 2: Smith Dinner in New York. At the end of that speech, 204 00:10:24,679 --> 00:10:27,960 Speaker 2: he said, quote, A great leader is the giver and 205 00:10:28,040 --> 00:10:33,400 Speaker 2: protector of our hopes. Henry Kissinger dead at age one hundred. 206 00:10:34,559 --> 00:10:37,400 Speaker 2: Coming up Riturn to our special CONTRIBITTERA Larry Sumrso Harvard 207 00:10:37,400 --> 00:10:39,920 Speaker 2: for his thoughts on the lives and legacies of two 208 00:10:39,960 --> 00:10:42,960 Speaker 2: towering figures, Henry Kissinger and Charlie Munger. That's next on 209 00:10:43,000 --> 00:10:44,320 Speaker 2: Wall Street Week on Bloomberg. 210 00:10:53,280 --> 00:10:57,520 Speaker 1: This is Bloomberg Wall Street Week with David Weston from 211 00:10:57,640 --> 00:11:00,679 Speaker 1: Bloomberg Radio. 212 00:11:04,760 --> 00:11:06,560 Speaker 2: This is Wall Street Week. I'm David Weston, and were 213 00:11:06,559 --> 00:11:08,880 Speaker 2: welcome to our very special contributor here in Wall Streetek. 214 00:11:08,880 --> 00:11:10,640 Speaker 2: He is Larry Summons of Harvard. Larry, thank you so 215 00:11:10,720 --> 00:11:12,640 Speaker 2: much for being with us here in New York. It 216 00:11:12,679 --> 00:11:16,240 Speaker 2: has been quite a week where we lost Charlie Munger, 217 00:11:16,440 --> 00:11:20,520 Speaker 2: we lost we lost Henry Kissinger, and then on Friday 218 00:11:20,520 --> 00:11:22,960 Speaker 2: we actually lost Saturday O'Connor as well. I know you 219 00:11:23,080 --> 00:11:27,120 Speaker 2: knew Henry, well you knew Charlie Munger. Talk about Henry 220 00:11:27,160 --> 00:11:28,280 Speaker 2: Kissinger in your experience. 221 00:11:28,640 --> 00:11:29,840 Speaker 4: He was an extraordinary man. 222 00:11:30,960 --> 00:11:35,600 Speaker 12: It was extraordinary to see somebody in their eighties and 223 00:11:35,640 --> 00:11:39,280 Speaker 12: then in their nineties, and then one hundred years old, 224 00:11:40,000 --> 00:11:47,600 Speaker 12: so incredibly intellectually vital looking to learn about AI, speaking 225 00:11:47,640 --> 00:11:52,600 Speaker 12: to most of the world's leading statesman every several months. 226 00:11:53,040 --> 00:11:55,720 Speaker 4: He was fully engaged. 227 00:11:55,160 --> 00:11:59,040 Speaker 12: And active in the way that many people half his 228 00:11:59,120 --> 00:12:01,320 Speaker 12: age wouldn't. 229 00:12:00,880 --> 00:12:06,400 Speaker 4: Have had the energy and the drive to do. He 230 00:12:06,559 --> 00:12:09,400 Speaker 4: was somebody who always thought. 231 00:12:10,679 --> 00:12:17,120 Speaker 12: In the large verst understanding broad historical forces or shaping 232 00:12:17,200 --> 00:12:23,960 Speaker 12: relationships between countries that forming a conception of strategy. From 233 00:12:24,000 --> 00:12:31,400 Speaker 12: that conception of strategy working to tactics. It was anything 234 00:12:31,640 --> 00:12:36,840 Speaker 12: but the day to day political thrust of statements that 235 00:12:36,960 --> 00:12:43,520 Speaker 12: so often seems to preoccupy leaders these days. He surely 236 00:12:43,559 --> 00:12:48,600 Speaker 12: didn't get everything right, but he certainly was always trying 237 00:12:49,280 --> 00:12:56,000 Speaker 12: to reason from the large to reason down. And I 238 00:12:56,120 --> 00:13:03,880 Speaker 12: learned from his deep, li in a way tragic. 239 00:13:04,920 --> 00:13:07,079 Speaker 4: Sensibility. 240 00:13:07,200 --> 00:13:11,760 Speaker 12: He was the idealist as realist he and the realist 241 00:13:12,000 --> 00:13:17,040 Speaker 12: as idealist Henry, maybe because of how and where he 242 00:13:17,080 --> 00:13:23,720 Speaker 12: grew up in Germany in the nineteen thirties, feared disorder, 243 00:13:24,280 --> 00:13:30,480 Speaker 12: feared chaos, feared the complete triumph of passion over reason. 244 00:13:31,200 --> 00:13:37,520 Speaker 12: And his determination was to bring about stability, not because 245 00:13:37,559 --> 00:13:41,960 Speaker 12: he somehow thought that the pride of nations and strength 246 00:13:42,160 --> 00:13:47,440 Speaker 12: was what was most important, but because when there was 247 00:13:48,160 --> 00:13:52,719 Speaker 12: the containment of evil, that was when people had an 248 00:13:52,720 --> 00:13:56,920 Speaker 12: opportunity to live and flourish. 249 00:13:57,480 --> 00:14:00,960 Speaker 2: The partner of Warren Buffett important. What effect did he 250 00:14:01,120 --> 00:14:03,800 Speaker 2: have on writ large? 251 00:14:04,400 --> 00:14:04,520 Speaker 4: You know? 252 00:14:04,640 --> 00:14:08,240 Speaker 12: I think the first thing to say is that Charlie 253 00:14:08,240 --> 00:14:12,079 Speaker 12: and Henry had something very important in common. They had 254 00:14:12,160 --> 00:14:17,800 Speaker 12: different interests, they had different styles, they had different ways 255 00:14:17,840 --> 00:14:22,440 Speaker 12: of speaking, but they both had a deep commitment to 256 00:14:22,560 --> 00:14:26,160 Speaker 12: seeing the world as it was, not as they wanted 257 00:14:26,240 --> 00:14:30,800 Speaker 12: it to be. And they began by trying to see 258 00:14:30,880 --> 00:14:37,440 Speaker 12: things as realistically, as clinically accurately as possible. And that 259 00:14:37,600 --> 00:14:42,160 Speaker 12: was the basis for decision, whether it was political and 260 00:14:42,240 --> 00:14:46,320 Speaker 12: diplomatic decision in Henry's case, whether it was financial and 261 00:14:46,400 --> 00:14:52,400 Speaker 12: investment decision in Charlie's case. What I got from both 262 00:14:52,440 --> 00:14:58,440 Speaker 12: of them was this commitment to detached observation as a 263 00:14:58,480 --> 00:15:08,560 Speaker 12: prelude to taking action, you know, buy Warren's testimony. Charlie 264 00:15:08,600 --> 00:15:14,760 Speaker 12: provided a really extraordinary insight, he said, and it's different 265 00:15:14,800 --> 00:15:19,400 Speaker 12: than the old fashioned and traditional value investing credo. Charlie 266 00:15:19,880 --> 00:15:25,960 Speaker 12: rejected the idea of buying fair companies at great prices. 267 00:15:26,480 --> 00:15:31,160 Speaker 12: He thought you'd ultimately do better buying great companies at 268 00:15:31,400 --> 00:15:37,520 Speaker 12: fair prices. And that philosophy of finding the best, making 269 00:15:37,600 --> 00:15:42,120 Speaker 12: sure you weren't overpaying, and then sticking with it is 270 00:15:42,200 --> 00:15:46,120 Speaker 12: one that has certainly served certainly served him, and certainly 271 00:15:46,200 --> 00:15:51,880 Speaker 12: served warn well. But I saw it. Charlie was in 272 00:15:51,960 --> 00:15:55,120 Speaker 12: a lat wasn't involved a law of Harvard Law School 273 00:15:55,560 --> 00:16:00,360 Speaker 12: while I was the president of Harvard, and he had 274 00:16:00,400 --> 00:16:04,080 Speaker 12: a view. It was clear there was a logic, he 275 00:16:04,200 --> 00:16:06,400 Speaker 12: was prepared to argue and. 276 00:16:07,960 --> 00:16:13,560 Speaker 4: Defend it. He too was an extraordinary figure. 277 00:16:13,640 --> 00:16:16,240 Speaker 12: And you have to also look at both Henry and 278 00:16:16,360 --> 00:16:22,240 Speaker 12: Charlie and see the power of staying curious. They stayed 279 00:16:22,280 --> 00:16:26,280 Speaker 12: with it to the very end, and I think their curiosity, 280 00:16:26,360 --> 00:16:29,440 Speaker 12: their love of reading, their love of discussion, their love 281 00:16:29,440 --> 00:16:32,800 Speaker 12: of argument, was part of what caused them to flourish 282 00:16:32,920 --> 00:16:33,840 Speaker 12: for so very long. 283 00:16:33,960 --> 00:16:37,120 Speaker 2: Well, maybe a reach, but I think you're really emulating 284 00:16:37,200 --> 00:16:40,040 Speaker 2: that and staying curious as you've now taken this role 285 00:16:40,080 --> 00:16:42,560 Speaker 2: with Open Ai. You talk about Henry Kissinger with Open Air. 286 00:16:42,680 --> 00:16:44,960 Speaker 2: You're taking it on. Let me ask you, frankly, why 287 00:16:45,000 --> 00:16:46,680 Speaker 2: did you take the job and what do you hope 288 00:16:46,680 --> 00:16:47,240 Speaker 2: to do with it? 289 00:16:48,320 --> 00:16:52,000 Speaker 12: I thought that, as I said on your show, that 290 00:16:52,080 --> 00:16:56,880 Speaker 12: this was something that was extraordinarily important. You know, no 291 00:16:56,920 --> 00:17:01,040 Speaker 12: one can be certain whether this is once a decade technology, 292 00:17:01,080 --> 00:17:05,359 Speaker 12: a once a half century technology, a once a century technology, 293 00:17:05,720 --> 00:17:09,159 Speaker 12: a once a millennium technology. You know and can know 294 00:17:09,240 --> 00:17:13,800 Speaker 12: that for sure, but it sure looks like it's awfully 295 00:17:13,920 --> 00:17:23,119 Speaker 12: important to develop rapidly and safely and to disseminate effectively. 296 00:17:23,240 --> 00:17:26,960 Speaker 12: And well so, when I was offered an opportunity to 297 00:17:27,080 --> 00:17:32,280 Speaker 12: be part of contributing to that and overseeing to make 298 00:17:32,320 --> 00:17:37,840 Speaker 12: sure that that was effectively done, and to do it 299 00:17:37,960 --> 00:17:40,959 Speaker 12: working with some very great people. I thought it was 300 00:17:41,000 --> 00:17:43,800 Speaker 12: a real opportunity and I was glad to do it. 301 00:17:43,840 --> 00:17:46,320 Speaker 2: I don't want to take anything way for your technological expertise, 302 00:17:46,440 --> 00:17:49,239 Speaker 2: but when what you just said safely strikes me as 303 00:17:49,280 --> 00:17:51,119 Speaker 2: probably part of what you're going to be focused on, 304 00:17:51,480 --> 00:17:54,160 Speaker 2: and that gets to questions of governance about how you 305 00:17:54,200 --> 00:17:56,840 Speaker 2: handle this technology wherever it's going and how a powerful 306 00:17:56,880 --> 00:17:59,040 Speaker 2: may be. Do you have an overall sense of what 307 00:17:59,119 --> 00:18:01,760 Speaker 2: you need to do to government to get this safely 308 00:18:01,840 --> 00:18:02,280 Speaker 2: part right? 309 00:18:03,359 --> 00:18:05,520 Speaker 12: You know, David, I've been on the job two days 310 00:18:05,560 --> 00:18:08,760 Speaker 12: and they're going to send me the onboarding packet for 311 00:18:09,680 --> 00:18:13,640 Speaker 12: the board on Sunday. So I shouldn't be saying too 312 00:18:13,720 --> 00:18:17,960 Speaker 12: much at all because I don't know enough. 313 00:18:18,560 --> 00:18:20,760 Speaker 4: Here's some things I think I know. 314 00:18:21,440 --> 00:18:24,880 Speaker 12: I think I know that a company like this has 315 00:18:24,960 --> 00:18:30,199 Speaker 12: to be prepared to cooperate doesn't mean always agree with, 316 00:18:30,760 --> 00:18:36,960 Speaker 12: but cooperate with key government officials on regulatory issues, on 317 00:18:37,160 --> 00:18:47,520 Speaker 12: national security issues, on development of technology issues. I think 318 00:18:47,560 --> 00:18:51,080 Speaker 12: I know also, and this is integral to the structure 319 00:18:51,520 --> 00:18:57,800 Speaker 12: of open AI, where the for profit entity is itself 320 00:18:57,920 --> 00:19:04,760 Speaker 12: a creature of a not for profit ENTITYE that this 321 00:19:04,840 --> 00:19:09,480 Speaker 12: needs to be a corporation with a conscience, and that 322 00:19:09,520 --> 00:19:14,320 Speaker 12: we need to be always thinking about the multiple stakeholders 323 00:19:14,320 --> 00:19:18,000 Speaker 12: in the development of this technology, and as a board member, 324 00:19:18,080 --> 00:19:22,360 Speaker 12: that will be part of my responsibility working with other 325 00:19:23,280 --> 00:19:25,320 Speaker 12: board members to. 326 00:19:27,040 --> 00:19:28,560 Speaker 4: Make that certain. 327 00:19:28,960 --> 00:19:33,200 Speaker 12: You know, my colleague at Harvard Lake, colleague Ken Galbret, 328 00:19:33,400 --> 00:19:36,840 Speaker 12: said that conscious is the knowledge that someone is watching, 329 00:19:37,520 --> 00:19:41,040 Speaker 12: and I think it's the responsibility for everybody involved in 330 00:19:41,119 --> 00:19:47,360 Speaker 12: this to be thinking very carefully always about both opportunities 331 00:19:47,880 --> 00:19:52,600 Speaker 12: and uncertainties and to make sure that those are balanced 332 00:19:53,160 --> 00:19:55,879 Speaker 12: in the best way that's possible. 333 00:19:56,080 --> 00:19:57,760 Speaker 2: Claria, it's really great to have you with us, as 334 00:19:57,760 --> 00:20:00,439 Speaker 2: it always is. There's a very special contributor, Lary Summers 335 00:20:00,440 --> 00:20:03,280 Speaker 2: of Harvard and this is Wall Street Week on Bloomberg. 336 00:20:10,560 --> 00:20:14,720 Speaker 1: This is Bloomberg Wall Street Week with David Weston from 337 00:20:14,880 --> 00:20:21,359 Speaker 1: Bloomberg Radio. 338 00:20:23,320 --> 00:20:26,280 Speaker 2: Supply chains. Until the pandemic struck, most of us gave 339 00:20:26,320 --> 00:20:29,680 Speaker 2: them little thought, apart from those working in shipping and procurement. 340 00:20:30,160 --> 00:20:32,400 Speaker 2: But then we were hit with the reality that critical 341 00:20:32,400 --> 00:20:36,240 Speaker 2: supplies for healthcare and much more came from one country China, 342 00:20:36,600 --> 00:20:40,080 Speaker 2: presenting the need to diversify any supply chains are complicated. 343 00:20:40,119 --> 00:20:42,560 Speaker 9: Your viewers know this from the business world that look 344 00:20:42,680 --> 00:20:44,320 Speaker 9: the semiconductor value chain. 345 00:20:44,400 --> 00:20:46,640 Speaker 13: It stretches across the globe and goes around at least 346 00:20:46,640 --> 00:20:47,240 Speaker 13: three times. 347 00:20:47,600 --> 00:20:50,760 Speaker 2: Now, companies and countries are moving quickly to reinforce and 348 00:20:50,800 --> 00:20:54,520 Speaker 2: diversify their supply chains, with President Biden this week announcing 349 00:20:54,520 --> 00:20:57,480 Speaker 2: a White House Council on Supply Chain Resilience. 350 00:20:57,880 --> 00:21:01,280 Speaker 14: Let me be clear, in any corporation that's not brought 351 00:21:01,280 --> 00:21:04,840 Speaker 14: their prices back down even as inflations come down, even 352 00:21:04,880 --> 00:21:08,439 Speaker 14: the supply chains have been rebuilt, It's time to stop 353 00:21:08,520 --> 00:21:09,880 Speaker 14: the price gouging. 354 00:21:10,400 --> 00:21:13,240 Speaker 2: And with the new emphasis on alternative suppliers comes the 355 00:21:13,280 --> 00:21:17,520 Speaker 2: movement of capital and investment, creating investment alternatives to China. 356 00:21:17,920 --> 00:21:20,359 Speaker 15: I think some of the emerging markets outside of China 357 00:21:20,800 --> 00:21:24,960 Speaker 15: have done relatively well. These include places like India, include 358 00:21:24,960 --> 00:21:29,480 Speaker 15: places like Indonesia, Mexico, Brazil, and even some places in 359 00:21:29,480 --> 00:21:33,320 Speaker 15: Eastern Europe like Greece and even Poland. These countries have 360 00:21:33,400 --> 00:21:37,200 Speaker 15: done well, still relatively small to absorb too much capital. 361 00:21:37,520 --> 00:21:39,960 Speaker 15: Where you can see that this sort of new era 362 00:21:40,320 --> 00:21:40,919 Speaker 15: is beginning. 363 00:21:41,000 --> 00:21:44,440 Speaker 2: It ticks a while one of the beneficiaries is Mexico, 364 00:21:44,720 --> 00:21:45,679 Speaker 2: whether it's in trade. 365 00:21:45,920 --> 00:21:49,560 Speaker 16: The main issue with China is exports. They declined significantly 366 00:21:49,600 --> 00:21:51,920 Speaker 16: in terms of what they export to the US over 367 00:21:51,920 --> 00:21:54,560 Speaker 16: the last five years, and that I think until they 368 00:21:54,600 --> 00:21:56,560 Speaker 16: can turn that around, that's going to be an issue. 369 00:21:56,600 --> 00:21:59,159 Speaker 16: And there's other countries that are benefiting from this, like 370 00:21:59,280 --> 00:22:00,280 Speaker 16: Mexico with. 371 00:22:00,240 --> 00:22:02,520 Speaker 2: Its near shoring or in real estate. 372 00:22:02,840 --> 00:22:06,119 Speaker 13: I would say there's great opportunity is in Mexico in 373 00:22:06,160 --> 00:22:09,960 Speaker 13: the industrial space and particularly along the border, and you 374 00:22:10,080 --> 00:22:13,240 Speaker 13: have a lot of multinational companies that are located there 375 00:22:13,560 --> 00:22:17,440 Speaker 13: looking for logistics and distribution type space. 376 00:22:17,600 --> 00:22:18,720 Speaker 2: Or in manufacturing. 377 00:22:18,920 --> 00:22:20,760 Speaker 17: There are going to be markets that kind of in 378 00:22:20,840 --> 00:22:24,240 Speaker 17: Mexico where you know, more things are being made there. Again, 379 00:22:24,280 --> 00:22:27,359 Speaker 17: and some of the restrictions that have been applied to 380 00:22:27,440 --> 00:22:29,520 Speaker 17: China have benefited the Mexican economy. 381 00:22:29,880 --> 00:22:34,000 Speaker 2: Putting Mexico high end Jamie Diamond's list of investment opportunities, 382 00:22:34,280 --> 00:22:35,240 Speaker 2: We've doubled. 383 00:22:34,880 --> 00:22:37,119 Speaker 4: A triple or capital here in the last six years. 384 00:22:37,400 --> 00:22:42,320 Speaker 14: We cover more clients in private banking, investment banking, sm management, so. 385 00:22:42,640 --> 00:22:43,760 Speaker 4: Our is total. 386 00:22:44,040 --> 00:22:45,920 Speaker 2: I think it's one of the great opportunities I put 387 00:22:45,920 --> 00:22:48,239 Speaker 2: in Mexico if you had to pick a country, this 388 00:22:48,320 --> 00:22:57,320 Speaker 2: might be the number one opportunity to give us the 389 00:22:57,359 --> 00:23:01,080 Speaker 2: investors perspective on Mexico. We welcome now Joseph Sitt. He's 390 00:23:01,119 --> 00:23:04,480 Speaker 2: founder and chairman of Thor Equity, who's Sore Urban Unit 391 00:23:04,640 --> 00:23:07,280 Speaker 2: is the largest real estate developer in Mexico. So, Joe, 392 00:23:07,320 --> 00:23:08,720 Speaker 2: thank you so much for being here. It's great to 393 00:23:08,720 --> 00:23:10,199 Speaker 2: have you. First of all, give us a sense of 394 00:23:10,240 --> 00:23:11,880 Speaker 2: just how big you are in Mexico. 395 00:23:12,640 --> 00:23:16,560 Speaker 5: In terms of the company, we're probably the largest individual 396 00:23:16,600 --> 00:23:20,800 Speaker 5: developer in the retail asset class and the hospitality asset class. 397 00:23:21,160 --> 00:23:26,760 Speaker 5: And then because we're in so many things from industrial, manufacturing, condominiums, etc. 398 00:23:27,000 --> 00:23:27,200 Speaker 2: Etc. 399 00:23:27,640 --> 00:23:30,840 Speaker 5: We're probably top two, top three developer in the country today. 400 00:23:31,000 --> 00:23:31,880 Speaker 2: So why are you there? 401 00:23:33,560 --> 00:23:37,720 Speaker 5: Opportunity and I would call it both opportunity growth and 402 00:23:37,800 --> 00:23:42,240 Speaker 5: alternative when you think of the world and the world 403 00:23:42,520 --> 00:23:46,639 Speaker 5: how things are changing, Mexico is becoming quite the answer 404 00:23:46,760 --> 00:23:50,359 Speaker 5: to some of the United States's economic problems, and by 405 00:23:50,400 --> 00:23:54,600 Speaker 5: being that solution, it's been wonderful for them as a country. 406 00:23:54,720 --> 00:23:57,360 Speaker 5: I would say it's four things that really make up 407 00:23:57,720 --> 00:24:02,760 Speaker 5: their economy, their drive. One is their local specialty assets. 408 00:24:02,760 --> 00:24:06,720 Speaker 5: I call it it's avocados, it's tequila, and it's beer. 409 00:24:07,200 --> 00:24:09,679 Speaker 5: We know it is, you know, going out and having 410 00:24:09,720 --> 00:24:13,879 Speaker 5: that drink of beer and having the dip and have 411 00:24:14,680 --> 00:24:16,160 Speaker 5: the tequila, et cetera, et cetera. 412 00:24:16,520 --> 00:24:18,760 Speaker 2: But it really is a product. 413 00:24:18,320 --> 00:24:21,040 Speaker 5: That's been growing. I mean, if you think of tequila 414 00:24:21,720 --> 00:24:24,120 Speaker 5: thirty years ago, did you really go to a bar 415 00:24:24,160 --> 00:24:27,239 Speaker 5: and hear a friend order at tequila? Not really. And 416 00:24:27,320 --> 00:24:31,560 Speaker 5: so Mexican culture has gone global, It's gone viral. Sort 417 00:24:31,560 --> 00:24:34,440 Speaker 5: of what happened to sushi forty or fifty years ago 418 00:24:34,480 --> 00:24:38,679 Speaker 5: happened to Mexico. And then the second thing is remittances. 419 00:24:39,040 --> 00:24:41,960 Speaker 5: You know, a lot of Mexicans and Americans, because of 420 00:24:41,960 --> 00:24:45,840 Speaker 5: the close relationship between our countries, really transverse. 421 00:24:45,240 --> 00:24:46,000 Speaker 2: Back and forth. 422 00:24:46,280 --> 00:24:49,720 Speaker 5: And then probably the thing that's been the buzzword for 423 00:24:49,760 --> 00:24:53,400 Speaker 5: the last thirty or sixty days is near Shuri. You know, 424 00:24:53,480 --> 00:24:57,639 Speaker 5: we as a country, we see the world sort of 425 00:24:57,760 --> 00:25:03,680 Speaker 5: bifurcating multipolar conflict. Mexico's a great solution. It's right here 426 00:25:03,760 --> 00:25:07,440 Speaker 5: in our backyard. It's easy. Labor is actually cheaper than 427 00:25:07,560 --> 00:25:11,800 Speaker 5: labor is in China. The people are hard working, they're industrious. 428 00:25:11,920 --> 00:25:15,600 Speaker 5: The commuting point, the logistics for a container ship is 429 00:25:15,720 --> 00:25:19,000 Speaker 5: free relative to shipping it from China, and so it's 430 00:25:19,040 --> 00:25:20,720 Speaker 5: really become the Chinese alternative. 431 00:25:20,920 --> 00:25:24,359 Speaker 2: So, Joe, you've described an investment opportunity, A big investment 432 00:25:24,359 --> 00:25:27,800 Speaker 2: opportunity in Mexico typically was an opportunity money rushers in, 433 00:25:28,040 --> 00:25:30,600 Speaker 2: capital rushes in and it becomes fully priced. Where are 434 00:25:30,600 --> 00:25:33,239 Speaker 2: we in that cycle? How far? How close are we 435 00:25:33,280 --> 00:25:36,200 Speaker 2: to fully pricing the assets in Mexico? So it's not 436 00:25:36,320 --> 00:25:37,639 Speaker 2: quite the deal it was before. 437 00:25:38,240 --> 00:25:43,320 Speaker 5: Excellent question, and often people generalize by the country, but 438 00:25:43,400 --> 00:25:46,440 Speaker 5: you've got to also look at the specifics, meaning by 439 00:25:46,440 --> 00:25:50,199 Speaker 5: the asset classes. For example, near Shuring, you had one 440 00:25:50,280 --> 00:25:55,320 Speaker 5: hundred and twenty companies announce investments in Mexico so far 441 00:25:55,480 --> 00:25:58,480 Speaker 5: the first half of this year about twenty nine billion 442 00:25:59,200 --> 00:26:02,520 Speaker 5: in US dollars investment. The forty one percent increased from 443 00:26:02,560 --> 00:26:06,840 Speaker 5: last year. Based upon the early research, it's looking like 444 00:26:07,040 --> 00:26:08,119 Speaker 5: next year is going to. 445 00:26:08,200 --> 00:26:08,960 Speaker 2: Double on that. 446 00:26:09,560 --> 00:26:12,600 Speaker 5: So I would say from the industrial opportunity, I think 447 00:26:12,640 --> 00:26:16,200 Speaker 5: we're in the very very early innings of it, probably 448 00:26:16,240 --> 00:26:21,480 Speaker 5: the earliest innings amongst the different food groups. In fact, 449 00:26:21,760 --> 00:26:23,919 Speaker 5: one of the things that I've often bumped into my 450 00:26:24,040 --> 00:26:28,080 Speaker 5: challenges with investors as well, as sometimes, as we said 451 00:26:28,119 --> 00:26:31,119 Speaker 5: the media is we're often at thor sometimes a little 452 00:26:31,119 --> 00:26:34,560 Speaker 5: bit too early. We don't try to be the first, 453 00:26:34,600 --> 00:26:37,199 Speaker 5: as I often say, we try to be the fastest second, 454 00:26:37,720 --> 00:26:40,679 Speaker 5: but it's not until the third or fourth or fifth 455 00:26:40,680 --> 00:26:44,800 Speaker 5: that the investors get it. And same thing happened with 456 00:26:44,880 --> 00:26:47,199 Speaker 5: us in investing in Dubai, as you and I had 457 00:26:47,200 --> 00:26:50,959 Speaker 5: spoken about, you know, four years ago. Same thing happened 458 00:26:50,960 --> 00:26:53,800 Speaker 5: to us talking about Red States versus the Blue States 459 00:26:53,800 --> 00:26:58,000 Speaker 5: and investing in red states fifteen years ago. And we 460 00:26:58,119 --> 00:27:01,480 Speaker 5: think this is another one of those golden opportunities where 461 00:27:01,480 --> 00:27:04,040 Speaker 5: we're early. We're just in the beginning of the second 462 00:27:04,160 --> 00:27:08,080 Speaker 5: inning with a lot of runway, and those investors that 463 00:27:08,200 --> 00:27:11,600 Speaker 5: act quickly now to mind that opportunity. 464 00:27:11,200 --> 00:27:12,520 Speaker 2: Will get that benefit. 465 00:27:12,880 --> 00:27:15,440 Speaker 5: If they wait, call it three years or four years 466 00:27:15,520 --> 00:27:19,199 Speaker 5: or five years, then it starts getting priced in. I 467 00:27:19,240 --> 00:27:23,000 Speaker 5: would say retail is probably already priced in, and I 468 00:27:23,040 --> 00:27:28,560 Speaker 5: would say condominium's second home tourism, while growing, is probably 469 00:27:28,600 --> 00:27:31,760 Speaker 5: somewhere in the middle there. So I would say ahead 470 00:27:31,760 --> 00:27:36,560 Speaker 5: of the curve is industrial probably already valued, well is retail. 471 00:27:37,040 --> 00:27:40,800 Speaker 5: And as I often joke to give the expression to 472 00:27:40,880 --> 00:27:47,920 Speaker 5: my team, I say, ride the horses, feed the lions, 473 00:27:47,960 --> 00:27:51,520 Speaker 5: and shoot the dogs. I would call the office market 474 00:27:51,520 --> 00:27:54,399 Speaker 5: there probably the dog, and I would say the industrial 475 00:27:54,440 --> 00:27:55,600 Speaker 5: market is probably the lion. 476 00:27:55,880 --> 00:27:59,439 Speaker 2: Jui, you're clearly bullsh on Mexico's investment opportunity. Compare it 477 00:27:59,440 --> 00:28:01,679 Speaker 2: with small turn is. We had Steve Schwartzman just this 478 00:28:01,720 --> 00:28:03,600 Speaker 2: week say he thought, when it came to real estate, 479 00:28:03,640 --> 00:28:05,560 Speaker 2: Europe was a great opportunity. Right now, how do you 480 00:28:05,560 --> 00:28:08,880 Speaker 2: compare Mexico with Europe with some Asian alternatives? 481 00:28:09,440 --> 00:28:12,000 Speaker 5: Well, Steve is a friend, I'm a fan of him 482 00:28:12,040 --> 00:28:16,440 Speaker 5: and John Gray, both super smart guys. We often compare 483 00:28:16,520 --> 00:28:20,040 Speaker 5: notes and look at ourselves as a miniature version thematic 484 00:28:20,080 --> 00:28:25,600 Speaker 5: investor that then develops specialties in different areas. So I 485 00:28:25,640 --> 00:28:28,840 Speaker 5: don't doubt what he's saying. We've got an office in 486 00:28:29,119 --> 00:28:32,320 Speaker 5: most of the major metropolitan cities inside of Europe. 487 00:28:32,720 --> 00:28:34,440 Speaker 2: Very active market for us. 488 00:28:34,600 --> 00:28:37,280 Speaker 5: But I would say a lot of the early low 489 00:28:37,320 --> 00:28:41,400 Speaker 5: hanging fruit in Europe has been mined. But where the 490 00:28:41,440 --> 00:28:46,000 Speaker 5: opportunity in Europe is much more because of the dislocation, 491 00:28:46,120 --> 00:28:47,480 Speaker 5: because of financial markets. 492 00:28:47,680 --> 00:28:50,640 Speaker 2: So, Joe, what about geopolitics and particularly politics when it 493 00:28:50,640 --> 00:28:53,440 Speaker 2: comes to Mexico. That's often been an issue for investors. 494 00:28:53,520 --> 00:28:56,400 Speaker 2: We have an election coming up. Where does that stand today? 495 00:28:56,520 --> 00:28:59,880 Speaker 5: You know, when Amlo was going through his election cycle, 496 00:29:00,160 --> 00:29:05,080 Speaker 5: it's scared the bgbi's out of local players and candidly myself. 497 00:29:05,920 --> 00:29:09,640 Speaker 5: Amlo then came in and he sounded good. He was 498 00:29:09,680 --> 00:29:13,200 Speaker 5: a good hearer of what people were saying, but wasn't 499 00:29:13,240 --> 00:29:16,320 Speaker 5: a good listener, I'm sorry to say. And so I 500 00:29:16,400 --> 00:29:19,600 Speaker 5: really think that Mexico did well in spite of itself. 501 00:29:21,240 --> 00:29:25,200 Speaker 5: Now the politics is much better. Either way, We're getting 502 00:29:25,240 --> 00:29:28,840 Speaker 5: a woman for the first time as the president of Mexico. 503 00:29:29,280 --> 00:29:32,520 Speaker 5: It'll either be Claudia Scheinbaum or to be sociated with 504 00:29:32,520 --> 00:29:38,280 Speaker 5: god Viz. Both of them pro business listeners, touching their 505 00:29:38,280 --> 00:29:42,000 Speaker 5: communities and really caring about their constituents at all levels 506 00:29:42,280 --> 00:29:46,520 Speaker 5: and not just considering Rederick to be the answer. They're 507 00:29:46,560 --> 00:29:49,760 Speaker 5: thoughtful about the jobs, etc. So I would say that's 508 00:29:49,800 --> 00:29:54,240 Speaker 5: probably my overall number one most exciting thing today that 509 00:29:54,280 --> 00:29:57,440 Speaker 5: I'm about that I'm excited about about the future of 510 00:29:57,480 --> 00:29:59,400 Speaker 5: Mexico for the business community. 511 00:30:00,000 --> 00:30:01,240 Speaker 2: Thank you so much for being on Wall Street week. 512 00:30:01,240 --> 00:30:03,600 Speaker 2: Hoef you come back. This is great. As Joe said 513 00:30:03,960 --> 00:30:09,240 Speaker 2: of thor equities coming up, telling the difference between what's 514 00:30:09,280 --> 00:30:14,400 Speaker 2: fake and what's not? With or without artificial intelligence. That's 515 00:30:14,480 --> 00:30:24,960 Speaker 2: next on Wall Street Week on Bloomberg, Finally, one more 516 00:30:25,000 --> 00:30:29,040 Speaker 2: thought authentic. The Merriam Webster Dictionary defines it as worthy 517 00:30:29,120 --> 00:30:32,160 Speaker 2: of acceptance or belief, as conforming two or based on 518 00:30:32,360 --> 00:30:35,360 Speaker 2: fact and Miriam Webster has also deemed it to be 519 00:30:35,480 --> 00:30:39,040 Speaker 2: the word of the Year, explaining that the line between 520 00:30:39,160 --> 00:30:42,880 Speaker 2: real and fake has become increasingly blurred, which may just 521 00:30:42,960 --> 00:30:46,160 Speaker 2: be the understatement of the year. Certainly, some of the 522 00:30:46,200 --> 00:30:49,400 Speaker 2: tech communities seem to be struggling with the difference. Sponsors 523 00:30:49,440 --> 00:30:53,440 Speaker 2: canceled the Software Developer Conference this week after speaker's profiles 524 00:30:53,440 --> 00:30:55,960 Speaker 2: on the website turned out to be fake, leading several 525 00:30:55,960 --> 00:30:59,200 Speaker 2: tech executives to pull out, including one from Microsoft who 526 00:30:59,280 --> 00:31:02,400 Speaker 2: posted that he had been duped by the fake speakers. 527 00:31:02,680 --> 00:31:05,840 Speaker 10: There was a lot of concern that there was a 528 00:31:05,960 --> 00:31:09,120 Speaker 10: plot to make the account or to make the conference 529 00:31:09,160 --> 00:31:11,560 Speaker 10: look more diverse than it really was. 530 00:31:11,920 --> 00:31:15,080 Speaker 2: The once vaunted Sports Illustrated took down articles from its 531 00:31:15,120 --> 00:31:18,360 Speaker 2: site after allegations it had used artificial intelligence not only 532 00:31:18,400 --> 00:31:20,760 Speaker 2: to write the stories, but also to credit them to 533 00:31:20,840 --> 00:31:25,400 Speaker 2: fictitious reporters, complete with profiles. Something SI's parent company denies, 534 00:31:25,560 --> 00:31:29,080 Speaker 2: but says it is investigating further blurring that line between 535 00:31:29,080 --> 00:31:32,080 Speaker 2: the authentic and the fake. But all of that is 536 00:31:32,240 --> 00:31:35,200 Speaker 2: nothing compared with the current poster child for confusing fact 537 00:31:35,240 --> 00:31:40,000 Speaker 2: with fiction, Congressman George Santos from Long Island. Representative. Santos 538 00:31:40,080 --> 00:31:43,200 Speaker 2: continues to claim that life is treating him unfairly, even 539 00:31:43,240 --> 00:31:45,720 Speaker 2: after an indictment and a move by his colleagues to 540 00:31:45,800 --> 00:31:49,280 Speaker 2: expel him from the House of Representatives for making up 541 00:31:49,360 --> 00:31:51,320 Speaker 2: more things than we have time to go. 542 00:31:51,320 --> 00:31:55,240 Speaker 18: Through pursue it to Article one, Section five, clause two 543 00:31:55,800 --> 00:31:59,440 Speaker 18: of the Constitution of the United States, Representative George Santos 544 00:31:59,560 --> 00:32:03,720 Speaker 18: b and he hereby is expelled from the House of Representatives. 545 00:32:04,000 --> 00:32:06,640 Speaker 2: In the world of business, Elon Musk certainly has his 546 00:32:06,760 --> 00:32:09,240 Speaker 2: work cut out for him, sorting through over one hundred 547 00:32:09,240 --> 00:32:12,600 Speaker 2: million posts on his ex social media site to separate 548 00:32:12,680 --> 00:32:15,240 Speaker 2: what's true from what's not, and, for that matter, what's 549 00:32:15,280 --> 00:32:19,120 Speaker 2: just downright malicious. But for Musk right now, the problem 550 00:32:19,160 --> 00:32:22,320 Speaker 2: isn't so much what's falls as what is undeniably true, 551 00:32:22,720 --> 00:32:25,080 Speaker 2: like the fact that he reposted something that much of 552 00:32:25,120 --> 00:32:28,920 Speaker 2: the world regarded as antisemitic, which triggered advertisers like Apple, 553 00:32:29,160 --> 00:32:32,400 Speaker 2: Disney and IBM to pull their money from the site. 554 00:32:32,440 --> 00:32:37,360 Speaker 9: This company X Twitter has spent months basically doing damage 555 00:32:37,360 --> 00:32:40,160 Speaker 9: control over Elon Musk's posts. 556 00:32:40,200 --> 00:32:43,040 Speaker 2: Apparently as a make good mister Musk traveled to a 557 00:32:43,080 --> 00:32:45,560 Speaker 2: war zone this week and offered to help rebuild Gaza. 558 00:32:45,640 --> 00:32:47,520 Speaker 2: Once the fighting has stopped. 559 00:32:47,440 --> 00:32:52,360 Speaker 3: Those who are intentioned motor must be inutralized, then the 560 00:32:52,520 --> 00:32:54,280 Speaker 3: deep propaganda west stop. 561 00:32:54,640 --> 00:32:54,800 Speaker 4: Well. 562 00:32:54,840 --> 00:32:56,160 Speaker 2: I hope he will be involved in it. 563 00:32:56,760 --> 00:32:57,160 Speaker 4: Toptel. 564 00:32:57,560 --> 00:33:00,760 Speaker 2: As mister Musk struggled to deal with how he's marketing X, 565 00:33:00,880 --> 00:33:04,000 Speaker 2: another business leader took a very different approach. One of 566 00:33:04,000 --> 00:33:07,160 Speaker 2: the great brand builders of our time, Martha Stewart, has 567 00:33:07,240 --> 00:33:10,400 Speaker 2: of course, made a series of TV commercials with Snoop Dogg, 568 00:33:10,880 --> 00:33:16,080 Speaker 2: Do I Smell That's Right? On Due Time? And then 569 00:33:16,280 --> 00:33:19,160 Speaker 2: posed for the cover of the Sports Illustrated Swimsuit edition 570 00:33:19,320 --> 00:33:22,400 Speaker 2: at the age of eighty one. Now, Miss Stewart has 571 00:33:22,480 --> 00:33:25,200 Speaker 2: taken yet another step to keep her profile high, this 572 00:33:25,360 --> 00:33:27,840 Speaker 2: time by offering a stay at a two bedroom cottage 573 00:33:27,840 --> 00:33:31,560 Speaker 2: on her estate in Bedford, New York, through Airbnb, complete 574 00:33:31,680 --> 00:33:34,720 Speaker 2: with a brunch with Martha herself, all at the bargain 575 00:33:34,760 --> 00:33:38,000 Speaker 2: basement price of eleven dollars and twenty three cents talk 576 00:33:38,040 --> 00:33:41,200 Speaker 2: about marketing. The world was reminded this week of just 577 00:33:41,240 --> 00:33:44,200 Speaker 2: what the word authentic really means when it comes to investing, 578 00:33:44,280 --> 00:33:46,560 Speaker 2: with the passing of Charlie Munger at the age of 579 00:33:46,640 --> 00:33:49,920 Speaker 2: ninety nine. As the longtime partner of Warren Buffett, Charlie 580 00:33:49,960 --> 00:33:52,760 Speaker 2: made money for Berkshire Hathaway shareholders the old fashioned way. 581 00:33:53,000 --> 00:33:56,120 Speaker 2: He earned it by doing his homework, making a few 582 00:33:56,160 --> 00:33:59,480 Speaker 2: big decisions and staying with them and in the process 583 00:33:59,560 --> 00:34:02,280 Speaker 2: made his historic returns. When it comes to Charlie Munger 584 00:34:02,440 --> 00:34:05,760 Speaker 2: and Warren Buffett, there was no fiction. It was all fact. 585 00:34:06,080 --> 00:34:08,160 Speaker 4: I think I fixed one flaw in my life. I 586 00:34:08,200 --> 00:34:10,879 Speaker 4: got over having tantrums when I was about four or five. 587 00:34:11,120 --> 00:34:13,680 Speaker 4: But every other flaw I have I haven't fixed. 588 00:34:13,719 --> 00:34:17,040 Speaker 12: I've just counterbalanced it, both offsetting virtues. 589 00:34:17,239 --> 00:34:19,000 Speaker 2: That does it for this episode of Wall Street Week, 590 00:34:19,080 --> 00:34:21,799 Speaker 2: I'm David Weston. This is Bloomberg. See you next week.