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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the

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Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am

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Speaker 1: Eastern on Applecarplay and Android Auto with the Bloomberg Business App.

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Speaker 1: Listen on demand wherever you get your podcasts, or watch

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Speaker 1: us live on YouTube.

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Speaker 2: So the headline's coming fast and furious from everywhere when

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Speaker 2: it comes to political risk.

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Speaker 3: Joining us now is Nathan Dean.

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Speaker 2: He's Bloomberg Intelligence Senior Policy a list Nathan, what is

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Speaker 2: the rhetoric that we're going to see out of the

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Speaker 2: White House this afternoon based on now Canada putting tariffs

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Speaker 2: on US deal on aluminum and the EU threatening retaliation

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Speaker 2: as well.

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Speaker 4: I think it's going to.

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Speaker 5: Be very similar to the truth social posts that we

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Speaker 5: saw from yesterday from President Trump and responding to the

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Speaker 5: Ontario premiere Doug Ford in terms of those tariffs or

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Speaker 5: at least the export taxes that they was putting on

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Speaker 5: electricity to those one point five million Americans up in

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Speaker 5: Minnesota and New York, you know, And I think this

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Speaker 5: is what you're gonna wait and you're gonna see this

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Speaker 5: exactly the same thing coming from EU, because look, you know,

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Speaker 5: we've always been telling our clients. When it comes to tariffs,

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Speaker 5: President Trump goes out there with these big statements and

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Speaker 5: that subsequently walks them back negotiates, and that doesn't really

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Speaker 5: see the fruition. However, over the last few days, we

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Speaker 5: begin to see that the you know, the small incremental

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Speaker 5: tariffs take place, the twenty percent tariff on China, you know,

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Speaker 5: the medals, the aluminum and steel tariffs on Canada just yesterday.

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Speaker 5: So these tariffs are now coming into fruition. And so

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Speaker 5: I think the writeric is going to continue. But we

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Speaker 5: always have to just go back to the idea that

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Speaker 5: there's one person that decides whether these tariffs happen or not.

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Speaker 5: It's President Trump. So you always have to just keep

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Speaker 5: your mind open that he could potentially walk some.

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Speaker 4: Of this back.

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Speaker 6: I've asked this before, I'll ask it again, And now

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Speaker 6: now it's on this issue of taris where are the Democrats?

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Speaker 7: Who's the voice?

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Speaker 4: Yeah, so they're still trying to figure out their voice.

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Speaker 5: I mean, obviously there's been a lot of push in

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Speaker 5: terms of from House Democrat trying to tell their Senate

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Speaker 5: colleagues that they should vote no on this government funding

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Speaker 5: bill that's making its way through Congress, in response to DOJE,

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Speaker 5: in response to tariffs, just in response to President Trump's agenda.

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Speaker 5: The Senate Democrats are actually meeting today. They have to

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Speaker 5: figure it out. There's going to need to be eight

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Speaker 5: votes for the Democrats on Friday, because Senator Ran Paul

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Speaker 5: is going to vote no.

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Speaker 4: Otherwise we're going to risk a government shutdown.

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Speaker 5: And I just do not think the Senate Democrats have

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Speaker 5: a strategy yet in place that warrants what their response

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Speaker 5: to President Trump will be. And as a result, you know,

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Speaker 5: a lot of the news cycle continues to be dominated

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Speaker 5: by President Trump and his actions.

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Speaker 2: I have to say, the fact that we could have

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Speaker 2: a government shutdown has not at all been on my radar.

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Speaker 2: That seems like the least thing, the last thing we

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Speaker 2: got to worry about here when it comes to being

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Speaker 2: a market participant.

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Speaker 3: So no, like, where are we though, will it shut down?

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Speaker 3: Are we good?

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Speaker 8: Well?

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Speaker 5: Your view is absolutely correct from the mindset of those

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Speaker 5: who pay attention to the markets, because when it comes

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Speaker 5: to government shutdowns, there's very little impact to markets. I mean,

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Speaker 5: the thirty five days cut down that occurred under President

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Speaker 5: Trump's first administration, markets went down and then subsequently came

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Speaker 5: back up. But where we are at the moment is

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Speaker 5: yesterday the House Republicans passed a bill. It's not a

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Speaker 5: clean bill, but a clean ish bill, mostly clean but

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Speaker 5: has a lot of things in their Democrats don't like.

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Speaker 5: But what Speaker Johnson did is he said, look, we've

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Speaker 5: passed the bill.

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Speaker 4: He sent the House home, everybody left town.

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Speaker 5: So now it's up to the Senate Democrats to decide

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Speaker 5: are we going to support this bill or are we

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Speaker 5: going to risk shutting the government down. And because the

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Speaker 5: House is gone, a shutdown will most likely occur. I

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Speaker 5: think the Senate Democrats will ultimately take the deal. I

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Speaker 5: maybe out of consensus, out of that, but I just

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Speaker 5: do not think that the Senate Democrats right now are

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Speaker 5: aligned on their strategy. And just as a few minutes ago,

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Speaker 5: Representative Alexandria Acasio Cortez was tweeting out that people should

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Speaker 5: be calling the Senate Dems because it looks like, in

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Speaker 5: her words, they're going to start the cave. So I

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Speaker 5: don't think the government's going to shut down. But again,

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Speaker 5: for those people who pay attention to the markets, there's

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Speaker 5: really no impact here. I mean, short term shutdown really

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Speaker 5: even doesn't impact the equities like large defense contractors.

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Speaker 6: What's the sense of timing, Nathan, When will we get

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Speaker 6: a decision on a potential shutdown or what the Senate's

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Speaker 6: going to do.

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Speaker 5: I think tonight you'll start to see the comments from

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Speaker 5: the Democratic senators giving indication of their position. You know,

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Speaker 5: Senator John Fennerman has already come out and said he's

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Speaker 5: going to vote for the bill. But all these other

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Speaker 5: a lot of the other moderate Democrats who potentially could

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Speaker 5: vote for this or keeping their powder dry, They're essentially saying, look,

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Speaker 5: it's a choice of two bad choices President Trump's agenda,

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Speaker 5: or we risk shutting the government down. But I don't

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Speaker 5: think the Democrats are going to try and surprise this

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Speaker 5: by Friday. I think we'll know either by late tonight

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Speaker 5: or early tomorrow where they're going, because look, at the

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Speaker 5: end of the day, it's not an easy choice for them,

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Speaker 5: and the last thing they want, I think, in my opinion,

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Speaker 5: is to surprise everybody and just say we haven't been

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Speaker 5: saying anything for days and then oop, weights we're we're

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Speaker 5: not gonna vote for this, but you know, anything can happen.

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Speaker 5: We're in You know, these are times that a lot

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Speaker 5: of people don't know what's going to happen.

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Speaker 3: What okay, let me say something crazy.

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Speaker 2: What I found really interesting was that we had Ontario

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Speaker 2: putting a REFFS on hydro power right, and then all

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Speaker 2: of a sudden moments later, like a day later, it

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Speaker 2: was taken off. And then now the negotiation has started

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Speaker 2: to happen between Ontario and the US.

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Speaker 3: What do we make of that.

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Speaker 2: Like do we make of the fact that, like any

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Speaker 2: retaliatory tariffs won't have any teeth because it's all a

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Speaker 2: negotiating ploy, and that Trump is going to get them

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Speaker 2: to the table no matter what.

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Speaker 5: Well, you know, I'll say, look, that's the primary objective

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Speaker 5: is to get them to the table and to negotiate.

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Speaker 5: But also if you look at the Canadian steel and

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Speaker 5: aluminum tariffs, you know President Trump's truth social statement said look,

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Speaker 5: we're going to fifty percent. Subsequently we're now at twenty

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Speaker 5: five percent, so that tariff did actually take place. But

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Speaker 5: you know, this process I think continues exactly how it's

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Speaker 5: been for the last few months. President Trump puts out

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Speaker 5: a statement, says we're going to do this, markets react

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Speaker 5: to it, there's a negotiation, sometimes just hours later it's

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Speaker 5: walked back, and there's additional open doors and additional nuggets

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Speaker 5: that says, maybe this isn't going to happen, but in

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Speaker 5: crementally tariffs are being put on place, that twenty percent

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Speaker 5: tariff on China, for example. So you know, if investors

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Speaker 5: have not already looked at the supply chain aspects of

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Speaker 5: the companies that they're looking at, they need to do

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Speaker 5: so now because we can't say with one hundred percent

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Speaker 5: certainty that these tariffs aren't going to happen. So investors

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Speaker 5: need to be prepared for that supply chain disruption or

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Speaker 5: the tariff hit as a result of it.

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Speaker 6: All Right, Nathan, let's be a glass half full type

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Speaker 6: of view here and say the government will not shut down.

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Speaker 6: What are the next couple of things on Congresses to

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Speaker 6: do list?

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Speaker 5: Do you think, Well, you know, Speaker Johnson is really

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Speaker 5: trying to push forward with this House Reconciliation package to

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Speaker 5: extend President Trump's tax cuts. This was going to cost

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Speaker 5: around four point five trillion dollars to extend those.

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Speaker 4: Now they have to do it by the end of

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Speaker 4: the year.

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Speaker 5: If a government does shut down, nobody's allowed to work

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Speaker 5: on that, and so the Republicans not be able to

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Speaker 5: work on that until the government reopens. Now, assuming the

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Speaker 5: government reopens, Speaker Johnson even just said this morning that

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Speaker 5: he hopes for all of this to be.

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Speaker 4: Resolved by men.

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Speaker 5: I'm not exactly sure that they're going to be able

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Speaker 5: to get there, because even though the Republicans were unified

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Speaker 5: yesterday in terms of keeping the government open in terms

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Speaker 5: of a budget, it was only a six month continuing resolution,

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Speaker 5: and it was a Cleanish bill. That's much different than

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Speaker 5: asking New York State Republicans are you going to support

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Speaker 5: not giving much in terms of salt.

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Speaker 4: Relief, or asking other folks are you going to.

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Speaker 5: Support taxes on tips which potentially could drive the deficit

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Speaker 5: even higher.

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Speaker 4: So the Republicans have to figure out.

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Speaker 5: Because there's no Democrats involved in this, the Republicans are

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Speaker 5: going to have to have some very strong and powerful conversations.

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Speaker 5: And I'm not exactly sure that's going to take place

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Speaker 5: in May. I think that's going to bleed throughout the summer.

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Speaker 5: But that work will continue next week, assuming the government

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Speaker 5: stays open again.

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Speaker 2: I was just at an energy conference in Houston for

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Speaker 2: a couple of days, and the theme is that CEOs

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Speaker 2: are really confused. People are not pulling projects, but they're

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Speaker 2: definitely pressing the pause button on many many things.

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Speaker 3: Is the administration listening to CEOs?

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Speaker 4: I think so.

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Speaker 5: I mean, obviously, the President Trump met with the Business

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Speaker 5: Roundtable yesterday. This is a collection of large CEOs from

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Speaker 5: you know, Fortune five hundred companies, and you know, we

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Speaker 5: heard the reporting that that was the message that President

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Speaker 5: Trump gave. But I would also say that President Trump

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Speaker 5: is very very much a believer in his strategy at

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Speaker 5: the moment, and I don't think there's much of the

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Speaker 5: business community is going to be able to.

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Speaker 4: Say to change his mind.

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Speaker 5: I think that it has to come from sticker shock

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Speaker 5: from prices, because prices are what got drove a lot

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Speaker 5: of voters to President Trump in the November elections, and

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Speaker 5: prices is something that a lot of American consumers, especially

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Speaker 5: Americans that don't have access to the markets, that don't

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Speaker 5: have assets in the markets, want to see from President Trump.

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Speaker 5: And so I think that price discussion, as we'll see

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Speaker 5: over the next few months, is what ultimately may change

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Speaker 5: President Trump's mind. But then again, you also liked seeing

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Speaker 5: the stock market in the green, so you know, again,

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Speaker 5: it's just it's very hard to predict.

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Speaker 6: Did we get any meaningful news out of that meeting

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Speaker 6: yesterday with the business leaders Nathan Now, not.

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Speaker 4: That I would say to any of my clients.

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Speaker 5: I think it was just more of the same that

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Speaker 5: you know, business leaders were saying, Look, we're looking for deregulation.

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Speaker 5: Deregulation is not a magic wand it's going to take time.

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Speaker 5: I think there was a lot of sentiment around the

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Speaker 5: election around deregulation. They're looking for clarity on tariffs. I

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Speaker 5: don't think you're going to get that. I think the

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Speaker 5: strategy of strong statements subsequently with negotiations, and then they're

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Speaker 5: looking for clarity on this tax debate, and you know

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Speaker 5: the problem with that is that it's just going to

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Speaker 5: take a long time because you know, they have to

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Speaker 5: figure out how to pay for a four point five

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Speaker 5: trillion in tax scuts or they have to figure out

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Speaker 5: a way to keep it as less impactful on the

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Speaker 5: deficit as possible. And so I don't think there was

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Speaker 5: a lot of clarity coming from the White House to

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Speaker 5: the business leadership. I think it was business leadership talking

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Speaker 5: points going to the White House.

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Speaker 2: How much do you think all this is currently reflected

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Speaker 2: in the equity prices are in equity prices.

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Speaker 5: I think it's beginning to be a little bit more

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Speaker 5: and more. I mean, because I think the realization is like, look,

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Speaker 5: this isn't exactly turning out the way that I think

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Speaker 5: a lot of investors thought after the election in terms

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Speaker 5: of sentiment, you know, the tariff discussion. I think a

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Speaker 5: lot of people have presumed that President Trump was going

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Speaker 5: to back down on it, and look, he may, but

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Speaker 5: President Trump is certainly asking some very difficult questions of

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Speaker 5: the market when it says, look, starting tonight at midnight,

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Speaker 5: I'm putting on a fifty percent tariff and then two

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Speaker 5: hours later saying no, maybe not, We're going to negotiate instead.

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Speaker 4: Markets don't like that.

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Speaker 5: So I think what we're seeing right now is just

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Speaker 5: this uncertainty and per your point about you know, pausing

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Speaker 5: a lot of projects, I think a lot of investors

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Speaker 5: are just saying, look, we need clarity on what's going

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Speaker 5: to happen here, otherwise we're going to begin to really

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Speaker 5: try and protect our positions.

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Speaker 4: They're not there yet. But if this uncertainty in.

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Speaker 5: This like you know, volatility continues from the political landscape,

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Speaker 5: I wouldn't be surprised if you know, my investors react

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Speaker 5: in a different way in the.

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Speaker 4: Next few weeks.

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Speaker 6: Nathan, thanks so much. We appreciate that Nathan Dean are

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Speaker 6: man of reason. Nowt there in Washington, d C helps

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Speaker 6: us understand some of these policy moves coming out of Washington, DC.

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Speaker 6: Nathan Dean, senior policy analyst with Bloomberg Intelligence, joining us

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Speaker 6: from Washington, d C.

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Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live

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Speaker 1: days at ten am Eastern on Apple Coarcklay and Android

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Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever

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Speaker 1: you get your podcasts, or watch us live on YouTube.

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Speaker 2: Be broadcast to you live for Interactive Brooks Studio right

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Speaker 2: here in Midtown Manhattan. You can also check us out

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Speaker 2: on YouTube dot com as well. All Right, yesterday, the

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Speaker 2: US and Ukraine have reached a thirty day seaspire with

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Speaker 2: Russia now it hinges on Russia's acceptance. While speaking to

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Speaker 2: reporters at the White House, President Trump addressed that deal.

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Speaker 3: Saying it's now up to Russia to agree.

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Speaker 2: Your friends agreed to it, and hopefully Russia.

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Speaker 9: Will agree to it.

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Speaker 6: We're going to beat with them later on today and tomorrow.

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Speaker 5: And hopefully we'll be able to wipe out a deal,

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Speaker 5: but I think the CEASPI is very important.

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Speaker 7: If we can get Russia to do it, that'll be.

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Speaker 2: Greaty All right, joining us now is Oliver Krook, Bloomberg

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Speaker 2: Gear correspondent on these talks. He joins us from Berlin.

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Speaker 2: All right, Oliver, what do we know? What is the

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Speaker 2: state of play?

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Speaker 7: Yeah, so listen, it's is ceasfire agreement.

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Speaker 10: We should just say cannot be agreed to by only

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Speaker 10: sort of one set of parties. But we should say

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Speaker 10: that the Youans now finally got on board, and that

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Speaker 10: is not what they wanted to do even two weeks ago. Right,

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Speaker 10: we were hearing from Zelensky in a number of top

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Speaker 10: Ukrainian officials before that massive blow up in the Oval Office,

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Speaker 10: saying that basically they do not want to come to

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Speaker 10: a conversation about a ceasefire. They want to come to

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Speaker 10: a conversation about the lasting just peace. That obviously changed

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Speaker 10: after the United States posit its military equipment deliveries to Ukraine,

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Speaker 10: stopped giving them intelligence, all that sort of thing that

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Speaker 10: kicked off last week. And now they've come at the

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Speaker 10: table and it sounds like they have agreed with the

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Speaker 10: United States after those talks in Saudi Arabia with Secretary

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Speaker 10: of State Mark Rubio to that thirty day seaspire. The

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Speaker 10: US sees this as basically trying to create the conditions

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Speaker 10: under which you can negotiate that permanent peace agreement. This

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Speaker 10: thirty day seaspire would also include an exchange of prisoners

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Speaker 10: of war, release of civilian detainees, the return of the

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Speaker 10: forcibly transferred Ukrainian children, and really to put together these

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Speaker 10: negotiating teams which haven't obviously had any contact between Russia

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Speaker 10: and Ukraine since the beginning of the war, and that

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Speaker 10: has led to the immediate resumption now of the un

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Speaker 10: of American military kit to Ukraine as well as intelligence.

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Speaker 10: And you know, it has been just basically the United

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Speaker 10: States and Ukraine. And now, as you were just saying,

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Speaker 10: you know, basically everything is in Putin's court right now

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Speaker 10: as to whether or not he's going to even entertain

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Speaker 10: these discussions.

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Speaker 6: And to that end, Oliver Bloomberg News has some reporting

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Speaker 6: out that Putin eyes way to truce terms, but with

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Speaker 6: his own conditions.

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Speaker 4: I'm not really sure what that means.

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Speaker 6: So maybe the broad question is a do we think

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Speaker 6: Putin's going to engage in this process right here now,

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Speaker 6: with this agreement, and what did we think he wants.

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Speaker 7: I suspect not just right here and now.

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Speaker 10: I mean I think that forever, since the beginning of

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Speaker 10: this war, for the last three years, time has been

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Speaker 10: on the side of the Russians, So they have really

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Speaker 10: in no rush, particularly since they've sort of gained momentum

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Speaker 10: on the battlefield.

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Speaker 7: Again.

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Speaker 10: That could mean a great many things. We've heard a

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Speaker 10: number of things from the Russians. They have said a

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Speaker 10: number of things that are basically non starters. They want

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Speaker 10: to take basically all of the eastern regions of Ukraine,

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Speaker 10: so that's lu Hansk, Donetsk, Zaporisha, and Kurzon. These are

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Speaker 10: not even territories that they fully occupy right now. So

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Speaker 10: this would mean even further concessions. They would want legal

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Speaker 10: recognition of that. They would want Ukraine to basically abandon

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Speaker 10: its aims.

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Speaker 7: To join NATO.

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Speaker 10: They would say that also European troops a sort of

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Speaker 10: deterrent or peacekeeping forces with Ukraine are non starter. So

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Speaker 10: these are all things that the Russians have said in

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Speaker 10: the past that they basically are non starters to any

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Speaker 10: sort of agreement that begs the question of what really

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Speaker 10: is in the interest of the Ukrainians or is this

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Speaker 10: just going to be basically a pretense for the Americans

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Speaker 10: to abandon Ukraine if they say, you know, they basically

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Speaker 10: cannot surmount the terms. What I think is interesting and

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Speaker 10: this was probably the most interesting thing we got out

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Speaker 10: of the press conference for Marco Rubio yesterday, saying that

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Speaker 10: basically they hope that the Russians will sign the deal,

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Speaker 10: but if they do not, they'll know who the impediment

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Speaker 10: to peace will be. That then provokes this question, and

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Speaker 10: we don't really know the answer to this from the

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Speaker 10: Trump administration.

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Speaker 7: If the Russians refused to come to the table and.

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Speaker 10: The United States is dissatisfied about.

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Speaker 7: It, what is Trump prepared to do about it.

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Speaker 10: We've had some talk about potential financial market regulations and

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Speaker 10: potentially sanctions on banks and finance as well as fossil fuels.

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Speaker 10: We haven't really fleshed out that side of things. We

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Speaker 10: know the sort of the difficult circumstances they're willing to

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Speaker 10: impose on Ukraine, but less so what they're willing to

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Speaker 10: impose upon Russia.

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Speaker 3: Does Europe have a seat at this particular.

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Speaker 7: Table, emphatically not so.

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Speaker 10: I think the best that the Europeans can basically hope

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Speaker 10: for US to get kind of an update at the

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Speaker 10: G seven Foreign ministers meetings that's happening right now in Canada.

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Speaker 10: But basically, no, they do not have a seat at

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Speaker 10: the table as it stands. I mean, I think that

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Speaker 10: the US's plan, what they would like to see longer

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Speaker 10: term is the Europeans to take more security responsibility, obviously

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Speaker 10: in the continent, possibly in Ukraine. But again, this is

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Speaker 10: a very thorny discretion even for the most hawkish voices

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Speaker 10: within Europe. You hear it from the Polish, they are

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Speaker 10: very reticent to ever commit any kind of troops, even

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Speaker 10: as peacekeeping forces within Ukraine. So that is sort of

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Speaker 10: a very difficult conversation have even nationally. So I think

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Speaker 10: that their sort of role in this has been sort

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Speaker 10: of ever diminishing, and I think, I suspect is not

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Speaker 10: going to increase anytime soon.

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Speaker 6: Oliver, what are the prospects for maybe timing of a

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Speaker 6: potential meeting between mister Trump and Putin?

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Speaker 10: Yeah, so listen, I think that Trump would like to

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Speaker 10: see this happen sooner rather than later. I think again,

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Speaker 10: Putin is proceeding with sort of extreme caution.

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Speaker 7: They've got all this sort of groundwork sort of laid

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Speaker 7: for it.

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Speaker 10: They would like, we know, to have that meeting, or

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Speaker 10: Trump would like to have that meeting in Saudi Arabia.

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Speaker 10: At this point, though, I think it's way too early

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Speaker 10: to tell when that could happen. We do know from

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Speaker 10: our reporting that Steve Wikoff, who's actually technically the sort

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Speaker 10: of special envoy for the Middle East but seems to

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Speaker 10: be the kind of special envoy for ceasefires generally speaking,

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Speaker 10: he's going to be in Moscow later this week to

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Speaker 10: sort of get the ball rolling there. But again, I

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Speaker 10: think it's very a little bit too early to say

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Speaker 10: to give a timeline on that.

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Speaker 2: At this precise moment, where are we in ramping up

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Speaker 2: defense spending in Germany.

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Speaker 10: So listen, I think this is going to be This

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Speaker 10: was the kind of the bazooka that was dropped the

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Speaker 10: other week by the leader of the CDU who's going

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Speaker 10: to be the incoming chancellor of Frederick Mertz. Here they

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Speaker 10: were talking about basically performing the debt break, and that

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Speaker 10: is a huge deal here in Germany. The debt break

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Speaker 10: is something that's not just a law within Germany. This

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Speaker 10: is part of the German constitution. They put it in

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Speaker 10: in two thousand and nine after the financial crisis.

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Speaker 7: What's interesting is Mertz ran on a.

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Speaker 10: Platform basically saying that they will not reform the debt break,

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Speaker 10: and then, you.

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Speaker 7: Know, five days after basically.

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Speaker 10: Winning the election and not winning sort of a decisive majority,

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Speaker 10: winning just sort of the biggest proportion within parliament, said

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Speaker 10: that they're willing to sort of reform the debt break.

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Speaker 10: That comes with its own issues within Germany at the

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Speaker 10: sort of national level. I mean, you have the AfD,

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Speaker 10: the far right that has been basically accusing a lot

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Speaker 10: of this sort of German politicians to be acting undemocratically.

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Speaker 10: What they are now trying to do is force through

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Speaker 10: this debt break reform which requires two thirds of the

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Speaker 10: parliament with the old parliament, despite the fact that they

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Speaker 10: had an election in order to get this money through

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Speaker 10: and listen, the market was very very pleased about this

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Speaker 10: in many respects, and this was priced in basically all

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Speaker 10: the way to the market, and then there was some

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Speaker 10: doubt about whether or not they're going to get it through.

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Speaker 10: It seems they're going to be able to get the

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Speaker 10: compromise in the lower house in the Buddnestag, But it

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Speaker 10: is not necessarily a done deal that they're going to

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Speaker 10: be able to reform the debt break to get all

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Speaker 10: that defense spending done.

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Speaker 6: So when do we get clarity out of Germany there

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Speaker 6: on this story, Oliver, Except obviously it's a big, big move.

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Speaker 10: Yeah, we should get it over the next couple of weeks.

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Speaker 10: Right now, where it's basically stuck is at the Bundestag,

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Speaker 10: where the Greens they basically they need to get the

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Speaker 10: Greens on board in order to reform this. At the

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Speaker 10: first sort of step, the Greens have kicked up with

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Speaker 10: a bit of a fuss because they've lost basically a

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Speaker 10: large proportion of their representation in the next parliament and

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Speaker 10: they want to put their stamp on things. I suspect

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Speaker 10: they'll be able to get through that. But then there

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Speaker 10: is the sort of the Bundesrat, which is the upper house.

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Speaker 10: I don't want to get too into the weeds here

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Speaker 10: of German politics, But then you need to get a

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Speaker 10: sort of a lot more complex arithmetic. So we will

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Speaker 10: get clarity of this over the next couple of weeks.

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Speaker 10: But if they can't get this through. This would be

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Speaker 10: an absolutely massive blow of all the sort of talks

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Speaker 10: we've had about defense spending and stuff that they're doing

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00:18:43,000 --> 00:18:45,640
Speaker 10: at the EU level, This was by far the most

443
00:18:45,640 --> 00:18:48,240
Speaker 10: significant thing we've seen out of European defense, and we've

444
00:18:48,280 --> 00:18:49,920
Speaker 10: seen it priced into a lot of the stocks and

445
00:18:49,960 --> 00:18:51,960
Speaker 10: a lot of the companies. You know, Ryan Mattel put

446
00:18:51,960 --> 00:18:53,639
Speaker 10: out their earnings today. This is the biggest sort of

447
00:18:53,680 --> 00:18:56,760
Speaker 10: defense contractor here within Europe. They're expecting twenty five to

448
00:18:56,840 --> 00:18:59,480
Speaker 10: thirty percent growth in sales just this year. That could

449
00:18:59,480 --> 00:19:00,920
Speaker 10: boost even higher if they get this through.

450
00:19:01,040 --> 00:19:03,520
Speaker 2: Yeah, I mean we're talking almost one trillion euros and

451
00:19:03,600 --> 00:19:05,480
Speaker 2: I jump changed at the end of the day, Oliver,

452
00:19:05,520 --> 00:19:08,480
Speaker 2: thanks a lot, really appreciated Oliver Crook joining us. He

453
00:19:08,560 --> 00:19:11,000
Speaker 2: is Bloomberg Europe, a europe correspondent.

454
00:19:12,760 --> 00:19:16,440
Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live

455
00:19:16,520 --> 00:19:19,640
Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android

456
00:19:19,640 --> 00:19:22,919
Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever

457
00:19:23,000 --> 00:19:26,120
Speaker 1: you get your podcasts, or watch us live on YouTube.

458
00:19:26,880 --> 00:19:28,960
Speaker 3: Well, in case you didn't know, I was in Houston.

459
00:19:28,640 --> 00:19:31,439
Speaker 2: Texas yes the last day and a half speaking to

460
00:19:31,640 --> 00:19:36,400
Speaker 2: many energy CEOs and officials and Secretary of Energy, Secretary

461
00:19:36,440 --> 00:19:36,919
Speaker 2: of the Interior.

462
00:19:36,960 --> 00:19:37,560
Speaker 3: It was really great.

463
00:19:37,560 --> 00:19:39,720
Speaker 2: We've got a lot of stuff going on there. I

464
00:19:39,760 --> 00:19:42,399
Speaker 2: did sit down with the conversation with One Oak President

465
00:19:42,480 --> 00:19:45,720
Speaker 2: Pierce Norton. So One Oak is a major US midstream

466
00:19:45,880 --> 00:19:49,359
Speaker 2: energy company, which means they transport stuff like natural gas

467
00:19:49,640 --> 00:19:53,280
Speaker 2: and GLS that's liquefied stuff and crude oil all across

468
00:19:53,560 --> 00:19:56,880
Speaker 2: the US Energy Corridor. So I asked him, like, can

469
00:19:56,920 --> 00:19:59,640
Speaker 2: you actually build? Can you build, baby build? If we're

470
00:19:59,640 --> 00:20:02,159
Speaker 2: gonna tariffs on aluminum and steel.

471
00:20:03,560 --> 00:20:06,520
Speaker 11: What I would give some stats behind that is in

472
00:20:06,560 --> 00:20:10,360
Speaker 11: two thousand and seven, when the shell Revolution started, there

473
00:20:10,440 --> 00:20:13,879
Speaker 11: was about twenty tcf a year of gas flowing in

474
00:20:13,920 --> 00:20:17,080
Speaker 11: the United States. Last year was forty few today trading

475
00:20:17,119 --> 00:20:21,000
Speaker 11: QP today. Now it's forty two trillion quit feet today.

476
00:20:21,560 --> 00:20:24,760
Speaker 11: So we've doubled that just since two thousand. That took

477
00:20:24,800 --> 00:20:27,639
Speaker 11: a massive build out. We've proven we can do it before,

478
00:20:27,680 --> 00:20:28,840
Speaker 11: and I think we could do it again.

479
00:20:29,240 --> 00:20:30,960
Speaker 2: What do you need to see though from the administration,

480
00:20:31,119 --> 00:20:34,879
Speaker 2: Because it's permitting, it's now tariffs, it's now you know,

481
00:20:34,920 --> 00:20:38,679
Speaker 2: putting a pipe in the ground, it's avoiding any lawsuits interestate, Like,

482
00:20:38,960 --> 00:20:40,399
Speaker 2: what do you need to see to get it done

483
00:20:40,520 --> 00:20:41,440
Speaker 2: sooner rather than later.

484
00:20:41,800 --> 00:20:46,520
Speaker 11: Well, I think it's anything that actually accelerates, you know,

485
00:20:46,640 --> 00:20:49,560
Speaker 11: the permitting is a help to us. But we have

486
00:20:49,600 --> 00:20:52,360
Speaker 11: a slogan at one Oh that you know, we don't

487
00:20:52,400 --> 00:20:54,720
Speaker 11: pick sides, We pick issues, and if the issue is

488
00:20:54,760 --> 00:20:57,640
Speaker 11: getting energy as quick as we can, then we need

489
00:20:57,680 --> 00:21:00,680
Speaker 11: to focus all aspects of that, not just on the administration.

490
00:21:00,760 --> 00:21:03,160
Speaker 12: But what is it that we can do as an.

491
00:21:02,960 --> 00:21:05,800
Speaker 11: Interstate company an interstate company, and what is it we

492
00:21:05,800 --> 00:21:06,320
Speaker 11: can do as.

493
00:21:06,200 --> 00:21:08,800
Speaker 3: In an industry aside from permitting.

494
00:21:09,320 --> 00:21:12,119
Speaker 2: If we get aluminum steel tariffs of twenty five percent,

495
00:21:12,440 --> 00:21:14,840
Speaker 2: what kind of headwind is that for build out?

496
00:21:15,240 --> 00:21:18,880
Speaker 11: Well, it's it's a timing issue. You know, for us,

497
00:21:18,960 --> 00:21:21,240
Speaker 11: we've already built out in most of our assets. We

498
00:21:21,320 --> 00:21:26,560
Speaker 11: spent ten billion dollars since twenty and seventeen in building

499
00:21:26,600 --> 00:21:29,640
Speaker 11: out growth projects, and then we spent another twenty five

500
00:21:29,680 --> 00:21:33,320
Speaker 11: billion in mergers and acquisitions, so we've kind of gotten

501
00:21:33,440 --> 00:21:36,359
Speaker 11: past that. So it's for on the pipe, it's a

502
00:21:36,400 --> 00:21:38,959
Speaker 11: timing issue. It's where are you in the process of

503
00:21:39,000 --> 00:21:41,560
Speaker 11: either trying to negotiate a deal or are you already

504
00:21:41,600 --> 00:21:43,440
Speaker 11: putting it in the ground. In our case, you're already

505
00:21:43,440 --> 00:21:44,800
Speaker 11: putting it in the ground, so it's not going to

506
00:21:44,840 --> 00:21:46,240
Speaker 11: have a material impact on us.

507
00:21:46,640 --> 00:21:49,120
Speaker 2: To that point, your capac span has rammed a lot

508
00:21:49,160 --> 00:21:50,560
Speaker 2: as you're doing all those projects.

509
00:21:50,640 --> 00:21:51,600
Speaker 4: Right, what.

510
00:21:53,400 --> 00:21:54,800
Speaker 9: When is your peak capex?

511
00:21:55,480 --> 00:21:57,520
Speaker 12: Probably not until the next couple of years.

512
00:21:58,920 --> 00:22:00,600
Speaker 3: And what does that wind up looking like? Because that's

513
00:22:00,600 --> 00:22:02,640
Speaker 3: a big that's a big spend. How do you reassure

514
00:22:02,640 --> 00:22:04,240
Speaker 3: investors that, like, it's really going to end there? And

515
00:22:04,280 --> 00:22:04,960
Speaker 3: what that looks like?

516
00:22:05,119 --> 00:22:08,320
Speaker 11: Right, it's probably around two to three billion dollars a year.

517
00:22:08,320 --> 00:22:11,119
Speaker 11: But given our size, we're now a sixty you know,

518
00:22:11,240 --> 00:22:15,400
Speaker 11: billion dollar market cap company. We added, you know, from

519
00:22:15,440 --> 00:22:18,600
Speaker 11: forty thousand miles of pipe to sixty thousand miles of pipe.

520
00:22:18,880 --> 00:22:20,920
Speaker 12: We cover twenty three different states.

521
00:22:21,200 --> 00:22:22,840
Speaker 11: We go all the way from the well head to

522
00:22:22,880 --> 00:22:26,000
Speaker 11: water and also all the way to basically the trucks

523
00:22:26,000 --> 00:22:30,320
Speaker 11: that bring the refined products, the jet fuel, the the

524
00:22:30,359 --> 00:22:32,680
Speaker 11: diesel of the gasoline, you know, to the end user.

525
00:22:34,640 --> 00:22:36,080
Speaker 2: So when do you think you would be more free

526
00:22:36,119 --> 00:22:38,800
Speaker 2: cash flow focus versus investment focus?

527
00:22:38,880 --> 00:22:40,639
Speaker 3: When what does that turn look like?

528
00:22:40,800 --> 00:22:43,200
Speaker 12: We're already free cash flow focused?

529
00:22:43,240 --> 00:22:43,480
Speaker 3: Okay?

530
00:22:43,640 --> 00:22:44,840
Speaker 9: Can you you could be both.

531
00:22:44,640 --> 00:22:45,480
Speaker 12: Like all that and kids?

532
00:22:46,040 --> 00:22:46,320
Speaker 8: Okay?

533
00:22:46,400 --> 00:22:46,640
Speaker 13: Yeah.

534
00:22:46,680 --> 00:22:48,960
Speaker 11: And the reason is because if you have enough free

535
00:22:48,960 --> 00:22:51,720
Speaker 11: cash flow, it opens up all levers, you know, for

536
00:22:51,840 --> 00:22:55,240
Speaker 11: cap to allocation. Our first priority is to actually spend

537
00:22:55,560 --> 00:22:58,840
Speaker 11: money on these high return projects. The second one is

538
00:22:58,880 --> 00:23:02,080
Speaker 11: to look at an increases. The third one is reducing

539
00:23:02,080 --> 00:23:05,080
Speaker 11: our debts. You do all that, and you do all

540
00:23:05,080 --> 00:23:06,960
Speaker 11: of that kind of stuff, and we've announced the two

541
00:23:06,960 --> 00:23:10,760
Speaker 11: billion dollars buyback program on our stock. We still have

542
00:23:10,840 --> 00:23:13,960
Speaker 11: money left over from that, but our commercial people find

543
00:23:13,960 --> 00:23:17,240
Speaker 11: a way to find those good projects for us.

544
00:23:17,240 --> 00:23:19,600
Speaker 12: So I'm not worried about spending that in the right way.

545
00:23:20,160 --> 00:23:22,760
Speaker 2: If oil prices slide, there were six months low yesterday

546
00:23:22,800 --> 00:23:25,040
Speaker 2: of natural gas prices slide, does that hurt you?

547
00:23:25,200 --> 00:23:27,159
Speaker 3: How does that affect Well.

548
00:23:27,080 --> 00:23:30,640
Speaker 11: What we've seen is that the producers are way more

549
00:23:30,680 --> 00:23:34,280
Speaker 11: resilient than they used to be used to. When prices

550
00:23:34,320 --> 00:23:37,320
Speaker 11: would go up or down a small amount, they would

551
00:23:37,320 --> 00:23:40,119
Speaker 11: either throw rigs, you know, at the issue, or they

552
00:23:40,160 --> 00:23:44,280
Speaker 11: would you know, they would lay rigs down. Now that

553
00:23:44,280 --> 00:23:47,320
Speaker 11: that gap seems to be a whole lot wider, and

554
00:23:47,400 --> 00:23:50,159
Speaker 11: part of that is because they're much more efficient.

555
00:23:50,080 --> 00:23:50,919
Speaker 12: Than they used to be.

556
00:23:50,960 --> 00:23:55,040
Speaker 11: They can drill longer laterals, especially where we are really

557
00:23:55,080 --> 00:23:58,560
Speaker 11: concentrated up in the Permi Basin and the Balking basin.

558
00:23:58,960 --> 00:24:01,200
Speaker 12: They're drilling. You know, used to drill a two mile.

559
00:24:01,080 --> 00:24:03,960
Speaker 11: Horizontal later announced almost three, so they can do it

560
00:24:04,000 --> 00:24:04,639
Speaker 11: for less capital.

561
00:24:04,680 --> 00:24:06,240
Speaker 2: I love you brought the Permian because we heard from

562
00:24:06,240 --> 00:24:08,760
Speaker 2: Mike Worth yesterday of Chevron that the Permian eventually is

563
00:24:08,800 --> 00:24:10,560
Speaker 2: going to plateau in the next few years.

564
00:24:11,040 --> 00:24:13,520
Speaker 3: Do you see that on a takeaway capacity basis?

565
00:24:13,880 --> 00:24:18,080
Speaker 11: Well, I've been in this business for forty years and

566
00:24:18,200 --> 00:24:20,880
Speaker 11: one of the things that I've seen is every time

567
00:24:20,920 --> 00:24:24,000
Speaker 11: you predict something like that, usually they find a way

568
00:24:24,080 --> 00:24:27,439
Speaker 11: of even becoming more efficient, so therefore opening up more drilling,

569
00:24:27,920 --> 00:24:30,920
Speaker 11: you know on you know, so you got your probable reserves,

570
00:24:31,000 --> 00:24:35,159
Speaker 11: you got your possible reserves, and then but your proven

571
00:24:35,240 --> 00:24:39,119
Speaker 11: reserves are what they're really after. So I would question,

572
00:24:39,680 --> 00:24:41,800
Speaker 11: I can see what is it that the you know,

573
00:24:41,920 --> 00:24:44,560
Speaker 11: is he talking about proven or probable reserves because they

574
00:24:44,560 --> 00:24:46,919
Speaker 11: have different pricing points.

575
00:24:48,359 --> 00:24:50,760
Speaker 2: When you take a look at the kind of infrastructure

576
00:24:50,800 --> 00:24:52,199
Speaker 2: build out that we're seeing, and I know that you're

577
00:24:52,200 --> 00:24:54,880
Speaker 2: already putting pipes in the ground, what do you think

578
00:24:54,920 --> 00:24:57,280
Speaker 2: we need to move stuff in the next five to

579
00:24:57,320 --> 00:24:59,080
Speaker 2: ten years? Like what stuff were we going to be

580
00:24:59,080 --> 00:24:59,720
Speaker 2: moving around.

581
00:25:00,560 --> 00:25:03,480
Speaker 12: We're going to move all kinds of molecules.

582
00:25:04,080 --> 00:25:07,199
Speaker 11: What people typically talk about is natural gas, which in

583
00:25:07,240 --> 00:25:10,199
Speaker 11: our business we call methane, but we're also going to

584
00:25:10,240 --> 00:25:11,720
Speaker 11: meet molecules.

585
00:25:11,080 --> 00:25:12,960
Speaker 12: For ethane for the petrick ems.

586
00:25:13,240 --> 00:25:15,600
Speaker 11: We're going to move molecules for propane, in which we

587
00:25:15,760 --> 00:25:19,200
Speaker 11: just announced the DOC down in Texas City with our

588
00:25:19,240 --> 00:25:22,840
Speaker 11: partner Marathon to provide propane all over the world world

589
00:25:22,840 --> 00:25:27,200
Speaker 11: scale DOC. We're going to be moving isive utane, normal utane, gasolines,

590
00:25:27,240 --> 00:25:29,560
Speaker 11: and in our case we move jet fuel, we move

591
00:25:30,000 --> 00:25:33,399
Speaker 11: gasoline for cars, and we also move diesel fuel. So

592
00:25:33,560 --> 00:25:36,840
Speaker 11: all of those molecules. There will be more of those

593
00:25:36,960 --> 00:25:39,840
Speaker 11: to move in the future.

594
00:25:39,040 --> 00:25:41,320
Speaker 3: In your line of sight with those molecules.

595
00:25:41,640 --> 00:25:44,920
Speaker 2: Any signs of a recession in the US, lowing economies,

596
00:25:45,000 --> 00:25:46,399
Speaker 2: lowing demands.

597
00:25:46,000 --> 00:25:50,680
Speaker 12: So far not not so.

598
00:25:49,520 --> 00:25:52,680
Speaker 2: Definitive, not com here to Norton, I want to President

599
00:25:53,119 --> 00:25:55,600
Speaker 2: and CEO of course is a major US menstream entergy companies,

600
00:25:55,640 --> 00:25:57,040
Speaker 2: so they transport.

601
00:25:56,680 --> 00:25:57,280
Speaker 3: All this stuff.

602
00:25:57,320 --> 00:25:57,480
Speaker 12: Now.

603
00:25:57,520 --> 00:26:00,439
Speaker 3: The biggest issue here, not to nerd out on you here.

604
00:26:00,359 --> 00:26:02,280
Speaker 2: Is that in order to make all of us happen,

605
00:26:02,359 --> 00:26:05,040
Speaker 2: and I mean all of this power demand data centers

606
00:26:05,119 --> 00:26:07,760
Speaker 2: you name it. You need pipelines and stuff, You need

607
00:26:07,800 --> 00:26:10,600
Speaker 2: transmission lines, which means you need permitting reform. And I

608
00:26:10,640 --> 00:26:12,880
Speaker 2: know that people's eyes glaze over when when you hear that.

609
00:26:13,400 --> 00:26:14,280
Speaker 3: But it's a mess.

610
00:26:14,400 --> 00:26:19,000
Speaker 6: Now is this administration? Does the industry have expectations at industry?

611
00:26:19,240 --> 00:26:22,960
Speaker 6: This industry? This administration will be.

612
00:26:22,880 --> 00:26:28,320
Speaker 2: Better, yes and slash, But will it? Will it stay better?

613
00:26:28,400 --> 00:26:31,520
Speaker 2: Will it be permanent permitting reform or will it be

614
00:26:31,560 --> 00:26:35,240
Speaker 2: small tweaks? Because to get permitting reform and get all

615
00:26:35,320 --> 00:26:38,600
Speaker 2: of the lawsuits potential lawsuits from states taken care of

616
00:26:38,720 --> 00:26:40,879
Speaker 2: all your pricing, all your sourcing and pipe in the

617
00:26:40,880 --> 00:26:43,560
Speaker 2: ground in four years could be very much impossible. So

618
00:26:43,600 --> 00:26:46,399
Speaker 2: you need like permanent reform in order to make it happen.

619
00:26:46,800 --> 00:26:48,640
Speaker 2: That part, I think is a little bit TBD.

620
00:26:49,080 --> 00:26:53,479
Speaker 6: What has changed, though, is the reasons we need this energy,

621
00:26:54,080 --> 00:26:57,840
Speaker 6: And I think that being AI, which most people don't

622
00:26:57,880 --> 00:26:59,640
Speaker 6: know what AI is, and I might throw myself into

623
00:26:59,680 --> 00:27:01,439
Speaker 6: that camp, but I know it's a thing, and I

624
00:27:01,440 --> 00:27:04,920
Speaker 6: know it's generally not positive, and it's a strategic imperative

625
00:27:04,920 --> 00:27:07,480
Speaker 6: for the United States. Therefore, in order for me to

626
00:27:07,480 --> 00:27:09,520
Speaker 6: be a leader in AI, I have to be a

627
00:27:09,640 --> 00:27:11,399
Speaker 6: leader in er supporter of energy.

628
00:27:11,760 --> 00:27:14,840
Speaker 2: Yes, and I spoke to some of the big power players,

629
00:27:14,840 --> 00:27:17,640
Speaker 2: so Constellation Energy, Energy, Next Era.

630
00:27:17,920 --> 00:27:19,679
Speaker 3: These are all the guys like their stock moves like

631
00:27:19,720 --> 00:27:21,560
Speaker 3: AI stocks because they're the power providers.

632
00:27:21,640 --> 00:27:21,840
Speaker 9: Right.

633
00:27:22,440 --> 00:27:24,480
Speaker 2: They were saying though that their demand growth that they've

634
00:27:24,520 --> 00:27:28,040
Speaker 2: seen has nothing to do with AI. Oh, it's still cloud,

635
00:27:28,440 --> 00:27:32,320
Speaker 2: it's still population growth, it's still just general demand. The

636
00:27:32,320 --> 00:27:34,640
Speaker 2: AI is then layered on top of that. So these

637
00:27:34,680 --> 00:27:37,000
Speaker 2: kind of forecasts, like the current money that they're making,

638
00:27:37,000 --> 00:27:37,680
Speaker 2: has nothing.

639
00:27:37,480 --> 00:27:38,840
Speaker 3: To do yet with those data centers.

640
00:27:38,960 --> 00:27:42,120
Speaker 2: Interesting, which I found to be extremely interesting that we're

641
00:27:42,320 --> 00:27:44,280
Speaker 2: way in the first inning when it comes to beefing

642
00:27:44,359 --> 00:27:45,200
Speaker 2: up that kind of demand.

643
00:27:46,000 --> 00:27:48,080
Speaker 6: What is the energy folks then are in Houston. What

644
00:27:48,119 --> 00:27:50,240
Speaker 6: were they feeling about just the tariff discussion?

645
00:27:50,400 --> 00:27:54,119
Speaker 2: Well, they love it, no, I'm kidding, yes, okay, So

646
00:27:54,320 --> 00:27:57,000
Speaker 2: on the record, everyone was always talking about how that

647
00:27:57,040 --> 00:28:00,280
Speaker 2: they're minimally exposed. It's demonymous. It's just you know, five

648
00:28:00,280 --> 00:28:03,080
Speaker 2: percent of their costs. It's no big deal. Off the record,

649
00:28:03,160 --> 00:28:05,080
Speaker 2: no one loves it. And they also don't love the

650
00:28:05,160 --> 00:28:09,679
Speaker 2: uncertainty and as mentioning before, Like I asked, particularly Patrick Piane,

651
00:28:09,720 --> 00:28:12,000
Speaker 2: who's the CEO of tautel energies who is offshore wind

652
00:28:12,040 --> 00:28:14,520
Speaker 2: projects right? I said, are you throwing them in the trash?

653
00:28:14,680 --> 00:28:16,560
Speaker 2: He's like nowhere, pausing, And I was like, why pausing.

654
00:28:16,600 --> 00:28:18,560
Speaker 2: He's like, they're thirty year leases. This is a four

655
00:28:18,600 --> 00:28:21,760
Speaker 2: year administration. But pause is still a pause, and pause

656
00:28:21,800 --> 00:28:24,080
Speaker 2: is still like not putting capital into certain projects.

657
00:28:24,160 --> 00:28:26,840
Speaker 6: When I think of energy projects, these things take time

658
00:28:27,240 --> 00:28:29,199
Speaker 6: long and a lot of capital, So you have to

659
00:28:29,200 --> 00:28:31,520
Speaker 6: have some level of certainty before you start putting all

660
00:28:31,520 --> 00:28:32,399
Speaker 6: that money into the ground.

661
00:28:32,480 --> 00:28:34,280
Speaker 3: Absolutely, and the buyers have do.

662
00:28:34,200 --> 00:28:36,200
Speaker 7: To yep, all right, good stuff.

663
00:28:36,240 --> 00:28:37,879
Speaker 6: I mean, we got plenty more to go too, But

664
00:28:38,000 --> 00:28:40,320
Speaker 6: I mean it's it just goes to the issue of

665
00:28:40,520 --> 00:28:42,760
Speaker 6: you know, the energy so is one of those industries

666
00:28:42,800 --> 00:28:44,120
Speaker 6: that doesn't like uncertainty.

667
00:28:45,800 --> 00:28:49,520
Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live

668
00:28:49,600 --> 00:28:52,640
Speaker 1: weekdays at ten am Eastern on Apple Coarcklay and Android

669
00:28:52,680 --> 00:28:56,000
Speaker 1: Auto with the Bloomberg Business Up. Listen on demand wherever

670
00:28:56,040 --> 00:28:59,600
Speaker 1: you get your podcasts, or watch us live on YouTube.

671
00:29:00,040 --> 00:29:01,880
Speaker 2: I was in Houston, Texas over the last day and

672
00:29:01,920 --> 00:29:03,960
Speaker 2: a half for a week long conference called Sarah Week.

673
00:29:04,000 --> 00:29:07,720
Speaker 2: It's where all the energy CEOs, officials, energy ministers, you

674
00:29:07,800 --> 00:29:10,520
Speaker 2: name it, are all there to discuss policy as well

675
00:29:10,520 --> 00:29:13,800
Speaker 2: as make deals etc. I was privileged to talk to

676
00:29:13,840 --> 00:29:18,080
Speaker 2: the CEO of ge Vernova, Scott Straisik. Now gie Rinova

677
00:29:18,200 --> 00:29:20,480
Speaker 2: was spun off a year ago from ge. It's the

678
00:29:20,520 --> 00:29:25,120
Speaker 2: gas and wind turbine manufacturer, so power generation, power grid.

679
00:29:25,680 --> 00:29:27,760
Speaker 2: This is the company that makes all that stuff, the

680
00:29:27,800 --> 00:29:30,360
Speaker 2: transformers that you plug into the grid to make all

681
00:29:30,400 --> 00:29:33,120
Speaker 2: the power work. They make that stuff them and three

682
00:29:33,160 --> 00:29:35,880
Speaker 2: other companies. I sat down with him and I said, look,

683
00:29:35,960 --> 00:29:39,560
Speaker 2: we have tariffs coming on, there's recession fears everywhere, equities

684
00:29:39,560 --> 00:29:42,160
Speaker 2: are getting hurt. How does this affect your business? Here's

685
00:29:42,160 --> 00:29:43,120
Speaker 2: that part of the conversation.

686
00:29:43,520 --> 00:29:46,800
Speaker 13: We've certainly experienced stock volatility over the last six months,

687
00:29:46,800 --> 00:29:48,680
Speaker 13: but the end market's not so much at all. No,

688
00:29:48,840 --> 00:29:50,920
Speaker 13: I mean, just like we started the year, I'd say

689
00:29:50,920 --> 00:29:53,880
Speaker 13: we expect substantial growth in both our gas and our

690
00:29:53,920 --> 00:29:57,360
Speaker 13: grid backlogs. It's substantially higher margin than when we started

691
00:29:57,400 --> 00:30:01,160
Speaker 13: the year. Continue to work on operationally proving our winden business.

692
00:30:01,200 --> 00:30:03,120
Speaker 13: So that's the one in a marketing that's a little

693
00:30:03,120 --> 00:30:05,880
Speaker 13: bit softer for us, but certainly in our larger, faster

694
00:30:05,960 --> 00:30:08,000
Speaker 13: growing business, there is really no change through the first

695
00:30:08,040 --> 00:30:09,080
Speaker 13: two and a half months of the year.

696
00:30:09,120 --> 00:30:09,600
Speaker 9: If we get.

697
00:30:09,520 --> 00:30:12,640
Speaker 2: Tariffs on aluminum steel tomorrow at twenty five percent, how

698
00:30:12,640 --> 00:30:14,000
Speaker 2: does that impact you At.

699
00:30:13,840 --> 00:30:16,120
Speaker 13: The end of the day, these are technologies that are needed,

700
00:30:16,360 --> 00:30:19,400
Speaker 13: and this is also an example of where it helps

701
00:30:19,440 --> 00:30:21,360
Speaker 13: to be a US based company. I mean, we only

702
00:30:21,400 --> 00:30:25,840
Speaker 13: buy about five percent of our raw materials from Canada, Mexico,

703
00:30:26,000 --> 00:30:28,680
Speaker 13: China that gets imported into the US, so we'll have

704
00:30:28,720 --> 00:30:31,440
Speaker 13: to navigate through whatever policies come, but we feel like

705
00:30:31,480 --> 00:30:33,080
Speaker 13: we can manage through those disruptions.

706
00:30:33,240 --> 00:30:34,960
Speaker 9: Do pricing power to push it through.

707
00:30:35,160 --> 00:30:37,480
Speaker 13: In the end, it doesn't mean in between between now

708
00:30:37,520 --> 00:30:40,239
Speaker 13: and then, there couldn't be some financial implications for us

709
00:30:40,320 --> 00:30:42,760
Speaker 13: with only about five percent of our material buy being

710
00:30:42,760 --> 00:30:45,080
Speaker 13: in those countries. We'll navigate through it, but we're not

711
00:30:45,120 --> 00:30:48,720
Speaker 13: immune to tariff risks, but we're confident we can navigate

712
00:30:48,720 --> 00:30:50,000
Speaker 13: our way through this.

713
00:30:50,000 --> 00:30:52,720
Speaker 9: This has been a year for ge Bernova quite a year.

714
00:30:52,840 --> 00:30:55,680
Speaker 2: Yeah, it's been spun out from GE and it's been

715
00:30:55,760 --> 00:30:58,640
Speaker 2: quite a year in terms of AI and data center demand.

716
00:30:58,680 --> 00:31:02,320
Speaker 2: What's been the biggest change you leading the company in

717
00:31:02,320 --> 00:31:02,920
Speaker 2: the last year.

718
00:31:03,400 --> 00:31:05,280
Speaker 13: Well, I mean, I'm proud of the first year, but

719
00:31:05,360 --> 00:31:07,760
Speaker 13: most Importantly, it's really just the beginning for us because

720
00:31:07,800 --> 00:31:10,320
Speaker 13: a lot of these trends, whether it be AI, whether

721
00:31:10,360 --> 00:31:13,560
Speaker 13: it be the electrification of these industries, it's really just starting.

722
00:31:13,640 --> 00:31:17,080
Speaker 13: So our end markets continue to strengthen. I think there's

723
00:31:17,120 --> 00:31:20,080
Speaker 13: a more reality based focus on both the need for

724
00:31:20,160 --> 00:31:22,680
Speaker 13: gas and nuclear, so the demand cycle for both of

725
00:31:22,720 --> 00:31:25,920
Speaker 13: those continues to get even stronger today than where we

726
00:31:25,920 --> 00:31:28,960
Speaker 13: were twelve months ago. And it really then comes back

727
00:31:29,000 --> 00:31:31,560
Speaker 13: to how do we deliver safely and in a high

728
00:31:31,600 --> 00:31:35,360
Speaker 13: quality way to serve this incredible market that we're walking into.

729
00:31:35,480 --> 00:31:39,080
Speaker 9: Your backlog is huge, right, It's like seventy three billion dollars, right?

730
00:31:39,400 --> 00:31:41,000
Speaker 2: Can you can be perspective like how much of that

731
00:31:41,080 --> 00:31:42,240
Speaker 2: is AI demand driven?

732
00:31:42,320 --> 00:31:44,520
Speaker 9: How much of that is like win stuff?

733
00:31:44,560 --> 00:31:46,960
Speaker 2: How much of that is transformers which is the stuff

734
00:31:46,960 --> 00:31:48,040
Speaker 2: you got to plug into the grid.

735
00:31:48,160 --> 00:31:48,440
Speaker 8: You bet.

736
00:31:48,480 --> 00:31:51,280
Speaker 13: It's still a very small proportion of our backlog is

737
00:31:51,360 --> 00:31:53,920
Speaker 13: directly attached to AI. I mean, when you really think

738
00:31:53,960 --> 00:31:56,880
Speaker 13: about even data centers in total, there's only about sixty

739
00:31:56,920 --> 00:32:00,960
Speaker 13: gigawatts of data centers globally today, and only fifteen percent

740
00:32:01,000 --> 00:32:03,160
Speaker 13: of that it's really explicitly related to AI.

741
00:32:03,400 --> 00:32:05,800
Speaker 8: Most of it's still cloud and storage.

742
00:32:05,880 --> 00:32:08,600
Speaker 13: So that's why there's so much growth to come because

743
00:32:08,640 --> 00:32:11,520
Speaker 13: we're really just starting. But I'm sure us sitting down

744
00:32:11,520 --> 00:32:12,880
Speaker 13: a few years from now, it's going to be a

745
00:32:12,960 --> 00:32:14,400
Speaker 13: larger proportion of our backlog.

746
00:32:15,000 --> 00:32:17,360
Speaker 9: How much do you think it would be.

747
00:32:16,640 --> 00:32:18,760
Speaker 13: Best guess, Oh, it's gonna be a lot more, there's

748
00:32:18,800 --> 00:32:19,560
Speaker 13: no question about it.

749
00:32:19,720 --> 00:32:19,960
Speaker 9: Dear.

750
00:32:20,160 --> 00:32:21,960
Speaker 8: No, I don't think we get to that proportion.

751
00:32:22,080 --> 00:32:24,360
Speaker 13: But it's going to become more AI centric, and it's

752
00:32:24,400 --> 00:32:28,040
Speaker 13: becoming even more US based because the amount of growth

753
00:32:28,080 --> 00:32:29,760
Speaker 13: that we're going to see in the US the rest

754
00:32:29,760 --> 00:32:31,680
Speaker 13: of the decade relative to the rest of the world,

755
00:32:31,720 --> 00:32:34,000
Speaker 13: it's going to be more tomorrow than it's certainly been

756
00:32:34,160 --> 00:32:35,280
Speaker 13: the last five to ten years.

757
00:32:35,400 --> 00:32:37,320
Speaker 2: In the meantime, you cannot get a CEO on the

758
00:32:37,360 --> 00:32:40,000
Speaker 2: stage at Sarah Week that isn't talking about GeV Ronova

759
00:32:40,000 --> 00:32:42,400
Speaker 2: because everyone's buying your gas turbines.

760
00:32:41,960 --> 00:32:42,720
Speaker 9: At the end of the day.

761
00:32:43,840 --> 00:32:47,120
Speaker 2: How how much of this is firm contracting? How much

762
00:32:47,120 --> 00:32:48,600
Speaker 2: of that is just like, yeah, yeah, we like it,

763
00:32:48,600 --> 00:32:50,160
Speaker 2: we're gonna buy it. Can you give me some insight

764
00:32:50,200 --> 00:32:50,480
Speaker 2: into that.

765
00:32:51,320 --> 00:32:55,160
Speaker 13: Well, we're very firm in contracts, certainly with our gas turbine,

766
00:32:55,200 --> 00:32:58,880
Speaker 13: our transformer, our switch gear backlog really through twenty seven

767
00:32:58,920 --> 00:33:01,200
Speaker 13: into twenty eight. Right now, I would expect by the

768
00:33:01,280 --> 00:33:04,280
Speaker 13: end of the summer will be largely sold out through

769
00:33:04,320 --> 00:33:08,000
Speaker 13: the end of twenty eight with those equipment. But we're

770
00:33:08,040 --> 00:33:10,360
Speaker 13: also looking to kind of find ways to get better

771
00:33:10,400 --> 00:33:12,959
Speaker 13: every day and a culture of continuous improvement, and if

772
00:33:13,000 --> 00:33:16,840
Speaker 13: we can increase capacity smartly as we figure out this ramp,

773
00:33:16,920 --> 00:33:20,240
Speaker 13: we'll do that. But for context, last fall we announced

774
00:33:20,280 --> 00:33:24,120
Speaker 13: a really almost thirty five percent increase in supply from

775
00:33:24,440 --> 00:33:27,520
Speaker 13: twenty five levels to twenty seven. So thirty five percent

776
00:33:27,560 --> 00:33:29,800
Speaker 13: increases a lot. It doesn't mean we stop there, but

777
00:33:29,800 --> 00:33:31,960
Speaker 13: we've got to get there first and then re evaluate

778
00:33:32,480 --> 00:33:34,040
Speaker 13: what the art of the possible really is.

779
00:33:34,640 --> 00:33:37,800
Speaker 2: Okay, So to that point, what are the issues with execution?

780
00:33:37,920 --> 00:33:38,080
Speaker 9: Then?

781
00:33:38,160 --> 00:33:40,440
Speaker 2: Like, it's a lofty goal, right You're investing six hundre

782
00:33:40,440 --> 00:33:42,560
Speaker 2: million dollars in plants in the US, it's a lot.

783
00:33:42,600 --> 00:33:44,840
Speaker 9: How fast can that happen? And what are the roadblocks

784
00:33:44,880 --> 00:33:45,080
Speaker 9: for you?

785
00:33:45,200 --> 00:33:47,160
Speaker 13: It's got to happen in the next two years, you know,

786
00:33:47,240 --> 00:33:49,600
Speaker 13: really this company is going to look very different between

787
00:33:49,600 --> 00:33:50,840
Speaker 13: now and the summer at twenty six.

788
00:33:51,000 --> 00:33:52,600
Speaker 9: What's the biggest hurdle for you to get that done.

789
00:33:52,680 --> 00:33:55,040
Speaker 13: Workers, right, we're going to add over We're going to

790
00:33:55,040 --> 00:33:59,000
Speaker 13: add over fifteen hundred employees. That's a combination of engineering

791
00:33:59,040 --> 00:34:03,120
Speaker 13: and craft lay. That's all in the US. Take gas

792
00:34:03,200 --> 00:34:06,320
Speaker 13: as an example. We've got to add over five hundred heavy.

793
00:34:06,120 --> 00:34:07,880
Speaker 8: Duty pieces of machinery into.

794
00:34:07,760 --> 00:34:11,520
Speaker 13: Our global factories to drive this growth in this ramp.

795
00:34:11,600 --> 00:34:14,960
Speaker 13: So that's a lot in existing factory footprints. We're highly

796
00:34:15,000 --> 00:34:17,160
Speaker 13: capable of doing it, but it's a lot between now

797
00:34:17,200 --> 00:34:19,479
Speaker 13: and let's say the fourth of July of next year.

798
00:34:20,400 --> 00:34:22,000
Speaker 13: So I like our chances, but there's a lot of

799
00:34:22,040 --> 00:34:24,280
Speaker 13: work to do.

800
00:34:24,320 --> 00:34:26,319
Speaker 2: Talk to me about the wind part, okay, because that's

801
00:34:26,320 --> 00:34:27,920
Speaker 2: sort of like the cousin.

802
00:34:27,760 --> 00:34:29,719
Speaker 3: No one wants to talk about right now, right or

803
00:34:29,760 --> 00:34:30,160
Speaker 3: the auncle.

804
00:34:31,000 --> 00:34:33,040
Speaker 2: If someone came to you and said, Hey, Scott, I

805
00:34:33,200 --> 00:34:35,399
Speaker 2: like to buy your wind business, would you be like, yes,

806
00:34:35,480 --> 00:34:36,320
Speaker 2: take it off my hands.

807
00:34:36,480 --> 00:34:36,560
Speaker 5: No.

808
00:34:36,600 --> 00:34:37,600
Speaker 8: I don't think it's that simple.

809
00:34:37,800 --> 00:34:39,359
Speaker 13: I think at the end of the day, we've got

810
00:34:39,400 --> 00:34:42,120
Speaker 13: a big onshore wind business today. Even in the US,

811
00:34:42,200 --> 00:34:45,359
Speaker 13: we have over thirty five thousand wind turbans that are

812
00:34:45,360 --> 00:34:49,520
Speaker 13: spinning creating electricity today. We see real opportunities to repower

813
00:34:49,600 --> 00:34:53,160
Speaker 13: that existing install base using the infrastructure that's already been built,

814
00:34:53,200 --> 00:34:56,160
Speaker 13: but putting longer blades onto the wind turbines that helps

815
00:34:56,200 --> 00:34:56,640
Speaker 13: the world.

816
00:34:57,000 --> 00:34:59,239
Speaker 8: We think there's a role for wind, and with that

817
00:34:59,360 --> 00:35:00,160
Speaker 8: role for wind.

818
00:35:00,120 --> 00:35:03,799
Speaker 13: We're focused today on just operationally running this business better

819
00:35:03,880 --> 00:35:06,640
Speaker 13: every day, waiting for the growth and inflection that comes.

820
00:35:06,680 --> 00:35:09,360
Speaker 13: So we really are a believer in all the above

821
00:35:09,440 --> 00:35:12,680
Speaker 13: technology suite. But we'll also look at our portfolio every

822
00:35:12,719 --> 00:35:15,960
Speaker 13: day with a steely eye on what creates value for

823
00:35:16,000 --> 00:35:19,640
Speaker 13: our shareholders. But there's no binary yes or no answer

824
00:35:19,640 --> 00:35:22,680
Speaker 13: to that question. But we're focused on running these businesses

825
00:35:22,719 --> 00:35:24,440
Speaker 13: better and ultimately creating value.

826
00:35:24,520 --> 00:35:25,879
Speaker 9: All right, So sticking to the wind.

827
00:35:26,400 --> 00:35:27,880
Speaker 2: The other part of your business, which I think is

828
00:35:27,920 --> 00:35:30,279
Speaker 2: so cool, are the transformers. So yes, you can have

829
00:35:30,320 --> 00:35:31,800
Speaker 2: all the wind farms you want, all the solar that

830
00:35:31,840 --> 00:35:33,680
Speaker 2: you want, but if you have to plug it into

831
00:35:33,680 --> 00:35:35,200
Speaker 2: the grid, so I think it is like a big socket.

832
00:35:35,239 --> 00:35:36,719
Speaker 3: I'm sure it's much more complicated than that.

833
00:35:36,800 --> 00:35:39,200
Speaker 2: But talk to you about the growth there, because everyone

834
00:35:39,200 --> 00:35:41,680
Speaker 2: talks about AI and data demand, but like, that's where

835
00:35:41,719 --> 00:35:42,919
Speaker 2: the potential growth is.

836
00:35:42,960 --> 00:35:44,120
Speaker 9: Walk me through the percentages.

837
00:35:44,239 --> 00:35:46,440
Speaker 13: And that's also for context where a lot of our

838
00:35:46,480 --> 00:35:50,359
Speaker 13: first interactions really came to be more intimate with the hyperscalers.

839
00:35:50,400 --> 00:35:52,680
Speaker 8: I mean, we did over half a billion.

840
00:35:52,400 --> 00:35:56,280
Speaker 13: Dollars of direct electrical equipment with the hyperscalers and orders

841
00:35:56,360 --> 00:36:00,920
Speaker 13: last year with transformers with switch gears attached their data centers.

842
00:36:01,800 --> 00:36:05,200
Speaker 13: That's a business that we see substantially growing from here.

843
00:36:05,239 --> 00:36:08,400
Speaker 13: Two years ago, our backlog coming into twenty twenty three

844
00:36:08,680 --> 00:36:12,000
Speaker 13: was about six billion dollars equipment backlog. It's north of

845
00:36:12,040 --> 00:36:15,040
Speaker 13: twenty billion dollars today. So it's a growth rate.

846
00:36:15,440 --> 00:36:16,560
Speaker 8: It'll stay growing.

847
00:36:16,600 --> 00:36:19,279
Speaker 13: Our backlogs certainly will grow at that same level for

848
00:36:19,320 --> 00:36:22,040
Speaker 13: another year here at expanding margins.

849
00:36:22,160 --> 00:36:25,520
Speaker 8: So this is I think we can have debates.

850
00:36:25,080 --> 00:36:29,520
Speaker 13: Between nuclear gas when what are the power generation sources

851
00:36:29,520 --> 00:36:30,920
Speaker 13: that are going to power the world?

852
00:36:31,000 --> 00:36:34,240
Speaker 8: Regardless, we need to invest in the grid, yes.

853
00:36:34,040 --> 00:36:36,200
Speaker 2: And that then leads us to transformers. Before I let

854
00:36:36,200 --> 00:36:38,359
Speaker 2: you go, North America's what like twenty twenty five percent

855
00:36:38,400 --> 00:36:41,239
Speaker 2: of your business right now? Uncertainty is quite high. We

856
00:36:41,280 --> 00:36:44,040
Speaker 2: saw it with the nfib A survey today of small businesses.

857
00:36:45,280 --> 00:36:47,760
Speaker 2: Is now a good time to invest in the US

858
00:36:47,880 --> 00:36:49,600
Speaker 2: and what part of that business do you think it

859
00:36:49,600 --> 00:36:51,040
Speaker 2: could be in the.

860
00:36:51,000 --> 00:36:51,840
Speaker 9: Next five years.

861
00:36:51,960 --> 00:36:54,200
Speaker 8: I think it's a great time to invest in the US.

862
00:36:54,320 --> 00:36:58,800
Speaker 13: Yes, we've gone through multiple decades with very little load growth,

863
00:36:58,880 --> 00:37:01,640
Speaker 13: and it's really imposed possible to underwrite a case that

864
00:37:01,680 --> 00:37:06,040
Speaker 13: we don't need substantially more electrical equipment and supply here

865
00:37:06,080 --> 00:37:07,640
Speaker 13: over the next decade.

866
00:37:07,840 --> 00:37:10,120
Speaker 8: And yeah, that's data centers, but it's not just that.

867
00:37:10,120 --> 00:37:13,520
Speaker 13: We're reindustrializing parts of the US to an extent that

868
00:37:13,960 --> 00:37:16,879
Speaker 13: is going to require more electrical load. You know, EVS,

869
00:37:16,920 --> 00:37:20,439
Speaker 13: home heating, there's a lot of other factors and beyond that,

870
00:37:20,480 --> 00:37:23,440
Speaker 13: we just need to modernize what we have for resilience

871
00:37:23,680 --> 00:37:25,000
Speaker 13: and energy security.

872
00:37:25,040 --> 00:37:26,919
Speaker 9: How big of a percentage could the US or North

873
00:37:26,920 --> 00:37:28,800
Speaker 9: America be in your portfolio in five years.

874
00:37:28,880 --> 00:37:31,480
Speaker 13: It's going to grow as a proportion, for sure, but

875
00:37:31,520 --> 00:37:33,839
Speaker 13: it's not the only market. We're continuing to see real

876
00:37:33,880 --> 00:37:37,080
Speaker 13: growth in Asia and in Europe. But we're very bullish

877
00:37:37,680 --> 00:37:39,840
Speaker 13: on the US and we're going to keep investing in

878
00:37:39,880 --> 00:37:42,880
Speaker 13: the US. You cited the six hundred million dollars and

879
00:37:43,200 --> 00:37:46,040
Speaker 13: fifteen hundred jobs attached to that, but that's not the end,

880
00:37:46,120 --> 00:37:49,160
Speaker 13: that's just the beginning as we continue to serve this market.

881
00:37:50,320 --> 00:37:55,239
Speaker 3: That was Scott Straisik. He is the CEO of ge.

882
00:37:55,239 --> 00:37:58,120
Speaker 2: Vernova and not much, just a touch of the many conversations,

883
00:37:58,160 --> 00:38:01,120
Speaker 2: which is obviously bullish power, big big, big way for

884
00:38:01,160 --> 00:38:04,320
Speaker 2: all the power players, you know, and the oil companies

885
00:38:04,360 --> 00:38:06,799
Speaker 2: are having a tougher time because of the tariffs and

886
00:38:06,840 --> 00:38:08,600
Speaker 2: what it means for global flows and all of that.

887
00:38:08,840 --> 00:38:10,480
Speaker 2: Particularly if we see a peace deal in.

888
00:38:10,480 --> 00:38:12,560
Speaker 3: Ukraine what that means for gas flows. But you know

889
00:38:12,560 --> 00:38:13,160
Speaker 3: they're managing.

890
00:38:13,280 --> 00:38:14,960
Speaker 6: Is the expectation if there is a peace deal that

891
00:38:15,000 --> 00:38:17,560
Speaker 6: the Russian gas I mean the oil and gas coming

892
00:38:17,560 --> 00:38:19,359
Speaker 6: out of Russia that we don't know where it's going,

893
00:38:19,520 --> 00:38:20,439
Speaker 6: but we know it's out there.

894
00:38:20,440 --> 00:38:23,320
Speaker 2: But expectation is, well, you're still buying some gas from Russia.

895
00:38:23,360 --> 00:38:25,279
Speaker 2: The real thing is about the gas. The oil will

896
00:38:25,280 --> 00:38:27,719
Speaker 2: be dictated more by opek plus. The expectation is that

897
00:38:27,760 --> 00:38:30,719
Speaker 2: gas will come back online in Europe more, but not

898
00:38:30,760 --> 00:38:33,719
Speaker 2: to the way it was. That's the that's the official line. Well,

899
00:38:33,760 --> 00:38:35,080
Speaker 2: someone actually winds up happening.

900
00:38:35,320 --> 00:38:36,080
Speaker 3: Have I bored you yet?

901
00:38:36,080 --> 00:38:38,120
Speaker 4: From melody conversation, I'm all in, I'm all in.

902
00:38:38,680 --> 00:38:39,560
Speaker 3: He'll be bored by Friday.

903
00:38:40,320 --> 00:38:45,040
Speaker 1: This is the Bloomberg Intelligence podcast, available on Apple, Spotify,

904
00:38:45,200 --> 00:38:48,680
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905
00:38:48,719 --> 00:38:52,480
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906
00:38:52,600 --> 00:38:56,120
Speaker 1: the iHeartRadio app tune In, and the Bloomberg Business app.

907
00:38:56,560 --> 00:38:59,640
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908
00:39:00,200 --> 00:39:02,080
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909
00:39:05,800 --> 00:39:05,840
Speaker 12: H