1 00:00:02,520 --> 00:00:13,760 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg 2 00:00:13,840 --> 00:00:17,920 Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern 3 00:00:18,200 --> 00:00:21,240 Speaker 1: on Apple car Play or Android Auto with the Bloomberg 4 00:00:21,320 --> 00:00:24,840 Speaker 1: Business app. Listen on demand wherever you get your podcasts, 5 00:00:25,280 --> 00:00:27,000 Speaker 1: or watch us live on YouTube. 6 00:00:27,160 --> 00:00:31,040 Speaker 2: Julian Manuel is chief equity and quantitative strategist at Evercore 7 00:00:31,120 --> 00:00:35,160 Speaker 2: ISI weaned off of Edward Hymen. He joins us here 8 00:00:35,280 --> 00:00:37,840 Speaker 2: this morning, I actually read your note this morning. Usually 9 00:00:37,880 --> 00:00:40,440 Speaker 2: I skim him. Oh, Julian, j U L I A N. 10 00:00:40,760 --> 00:00:43,120 Speaker 2: That's so I actually read the thing. Can you make 11 00:00:43,159 --> 00:00:46,280 Speaker 2: a termination with only nine percent of market cap in 12 00:00:47,479 --> 00:00:48,560 Speaker 2: is it just still too early? 13 00:00:49,040 --> 00:00:51,720 Speaker 3: It's difficult in general, and it's one of those ones 14 00:00:51,760 --> 00:00:55,319 Speaker 3: where like the financials tend to skew things and then 15 00:00:55,360 --> 00:00:56,760 Speaker 3: it gets reversed later on. 16 00:00:57,360 --> 00:00:58,400 Speaker 4: But look, there's. 17 00:00:58,320 --> 00:01:02,360 Speaker 3: Every indication, as has been the case the last several quarters, 18 00:01:02,600 --> 00:01:05,160 Speaker 3: that earnings are going to be strong and the surprise 19 00:01:05,319 --> 00:01:09,959 Speaker 3: element gets you to low double digits, which you know, frankly, 20 00:01:10,600 --> 00:01:13,959 Speaker 3: in this environment you need there to get there because 21 00:01:14,000 --> 00:01:15,480 Speaker 3: the expectations are that high. 22 00:01:15,680 --> 00:01:18,400 Speaker 2: My team with Michael Darta yesterday, which he wrote up 23 00:01:18,520 --> 00:01:21,680 Speaker 2: is look, this is where nominal GDP is and then 24 00:01:21,800 --> 00:01:24,360 Speaker 2: paragraph three of your wonderful note. And you don't write 25 00:01:24,400 --> 00:01:26,520 Speaker 2: the note. You got a team of people that write 26 00:01:26,560 --> 00:01:26,880 Speaker 2: the note. 27 00:01:26,959 --> 00:01:30,040 Speaker 4: Right, My team, that's what I know. This is what 28 00:01:30,080 --> 00:01:30,280 Speaker 4: I do. 29 00:01:30,680 --> 00:01:34,840 Speaker 5: My team gets all the cracks. And I see, you know, 30 00:01:34,959 --> 00:01:37,479 Speaker 5: four or five six authors. I go to the last 31 00:01:37,480 --> 00:01:39,760 Speaker 5: one on the list. That's a person I know. 32 00:01:39,800 --> 00:01:40,280 Speaker 4: They're the one that. 33 00:01:40,319 --> 00:01:44,680 Speaker 2: Wrote is it revenue driven? Is buried in your wonderful paragraphs? 34 00:01:44,680 --> 00:01:47,000 Speaker 2: It's about revenue getting that double digitterum. 35 00:01:47,120 --> 00:01:49,720 Speaker 3: Well, well, that that's the thing I mean if you 36 00:01:49,920 --> 00:01:55,160 Speaker 3: look at at the general trajectory of revenue growth versus 37 00:01:55,520 --> 00:01:59,640 Speaker 3: you know, sort of right after the pandemic, but pre pandemic, 38 00:02:00,160 --> 00:02:04,360 Speaker 3: it's much higher. And that is reflective of Atlanta fed 39 00:02:04,440 --> 00:02:08,760 Speaker 3: GDP clocking in the neighborhood of five percent. Right now, join. 40 00:02:08,680 --> 00:02:11,440 Speaker 5: Out like your twenty twenty six outlook note here, what 41 00:02:11,560 --> 00:02:13,400 Speaker 5: could surprise in twenty twenty six? 42 00:02:13,560 --> 00:02:15,280 Speaker 4: What are some of the things you think people should. 43 00:02:15,000 --> 00:02:18,600 Speaker 5: Be on the outlook for in terms of surprises? 44 00:02:18,760 --> 00:02:23,480 Speaker 3: Well, the surprise was number seven on the list, the 45 00:02:23,520 --> 00:02:28,240 Speaker 3: potential for the US taking control of in retrospect. We 46 00:02:28,280 --> 00:02:30,920 Speaker 3: put that note out Sunday morning, we'd probably bump that 47 00:02:31,000 --> 00:02:35,760 Speaker 3: up a couple of places. I would say, what's interesting 48 00:02:36,120 --> 00:02:39,440 Speaker 3: now about the setup is that you had all this 49 00:02:39,680 --> 00:02:43,840 Speaker 3: angst around debt financing, around the AI build out at 50 00:02:43,880 --> 00:02:47,960 Speaker 3: the end of last year, credit default swap markets getting stressed, 51 00:02:48,520 --> 00:02:52,639 Speaker 3: certain Hyperscaler's share prices getting stressed to the point where 52 00:02:53,000 --> 00:02:58,080 Speaker 3: there's enough skepticism around the AI story and technology in 53 00:02:58,160 --> 00:03:01,520 Speaker 3: general that in our mind it's almost sets up as 54 00:03:01,560 --> 00:03:04,080 Speaker 3: a contrarian play, and we're very excited by that. 55 00:03:04,760 --> 00:03:07,360 Speaker 5: So, I mean, we kind of came into Davos thinking 56 00:03:07,400 --> 00:03:10,880 Speaker 5: that AI might be the discussion point for the week. 57 00:03:11,280 --> 00:03:14,600 Speaker 5: That got thrown out with the you know, and now 58 00:03:14,600 --> 00:03:16,160 Speaker 5: it's all about greenland. 59 00:03:15,760 --> 00:03:17,000 Speaker 4: And tariffs right back. 60 00:03:17,080 --> 00:03:19,240 Speaker 5: It's almost like we were in April of last year here, 61 00:03:19,720 --> 00:03:21,119 Speaker 5: how much of a risk is that to the market 62 00:03:21,240 --> 00:03:23,480 Speaker 5: or can this market, just as it's done in the past, 63 00:03:23,600 --> 00:03:24,240 Speaker 5: kind of look through it. 64 00:03:24,280 --> 00:03:27,920 Speaker 3: Maybe well so, so again, this is one of the 65 00:03:28,080 --> 00:03:30,919 Speaker 3: you look at the last three years, a lot has 66 00:03:31,000 --> 00:03:34,880 Speaker 3: been thrown at a market that is being driven by 67 00:03:34,960 --> 00:03:43,240 Speaker 3: the secular growth and productivity bump potential of AI. But again, 68 00:03:43,920 --> 00:03:46,920 Speaker 3: we're in the fourth year of this bull market. It 69 00:03:47,000 --> 00:03:50,680 Speaker 3: should be more violatile, and our view was the aberration 70 00:03:51,000 --> 00:03:53,560 Speaker 3: was because there was too much complacency to start the 71 00:03:53,600 --> 00:03:54,680 Speaker 3: first two weeks of the year. 72 00:03:54,960 --> 00:03:55,440 Speaker 4: That's over. 73 00:03:55,640 --> 00:03:57,520 Speaker 2: I mean, I mean your advantages. You're working with the 74 00:03:57,560 --> 00:04:01,280 Speaker 2: economic combined of Evercore ISI. To be clear, you guys 75 00:04:01,360 --> 00:04:04,200 Speaker 2: nailed no recession. When you look at the data that 76 00:04:04,240 --> 00:04:07,800 Speaker 2: you're famous for, like trucking and railroads and all that. 77 00:04:08,160 --> 00:04:11,720 Speaker 2: Do you still have American GDP to drive revenues and 78 00:04:11,840 --> 00:04:13,640 Speaker 2: drive earnings? Absolutely? 79 00:04:13,960 --> 00:04:18,960 Speaker 3: In fact, the company surveys hit their highest level since 80 00:04:19,160 --> 00:04:23,479 Speaker 3: very early twenty twenty four just this last week. Things 81 00:04:23,560 --> 00:04:27,200 Speaker 3: are moving along in the right direction. And the Econ 82 00:04:27,320 --> 00:04:31,240 Speaker 3: team raised their forecast to two and a half percent 83 00:04:31,360 --> 00:04:35,240 Speaker 3: GDP for twenty twenty six. And I would say that 84 00:04:35,400 --> 00:04:38,320 Speaker 3: even at that number, the bias is still to the upside. 85 00:04:38,400 --> 00:04:40,120 Speaker 2: First thing I did today, Paul, as they looked at 86 00:04:40,120 --> 00:04:43,480 Speaker 2: the Nasdaq futures in the drawdown, it's like negative six percent. 87 00:04:43,560 --> 00:04:48,280 Speaker 2: It's like we cratered. Not folks, I'm kidding. I'm looking 88 00:04:48,279 --> 00:04:51,760 Speaker 2: at Standard Ports five hundred and coming off the tobacco 89 00:04:51,880 --> 00:04:55,039 Speaker 2: last April, we legged up one leg, two legs, and 90 00:04:55,080 --> 00:04:57,240 Speaker 2: then off we went to the races. Do you see 91 00:04:57,279 --> 00:05:00,760 Speaker 2: the same thing this time that we've got green and angst. 92 00:05:01,200 --> 00:05:04,040 Speaker 2: Somehow it will get solved and will have a multiple 93 00:05:04,080 --> 00:05:06,960 Speaker 2: leg up and a reaffirmation of a bull market. 94 00:05:07,520 --> 00:05:09,040 Speaker 3: We think it's going to take a little bit more 95 00:05:09,080 --> 00:05:11,640 Speaker 3: patience this time, So if you think about it, one 96 00:05:11,680 --> 00:05:15,880 Speaker 3: of the extraordinary things is that, for instance, the February 97 00:05:15,960 --> 00:05:19,520 Speaker 3: to April leg down last year happened so quickly that 98 00:05:19,800 --> 00:05:22,559 Speaker 3: unless you were an active manager at a hedge fund 99 00:05:22,760 --> 00:05:25,280 Speaker 3: where the risk manager tapped you on the shoulder and 100 00:05:25,320 --> 00:05:28,960 Speaker 3: said lighten up, you did nothing because it happened too quickly, 101 00:05:29,040 --> 00:05:31,320 Speaker 3: and in fact, the public was a buyer the whole 102 00:05:31,360 --> 00:05:34,960 Speaker 3: way down. We think the way this year unfolds is 103 00:05:35,000 --> 00:05:37,600 Speaker 3: you're going to have This is the first bout of 104 00:05:37,640 --> 00:05:40,880 Speaker 3: what we think is higher volatility. There will be multiple bouts, 105 00:05:41,160 --> 00:05:44,080 Speaker 3: and the key here is going to be patients and 106 00:05:44,160 --> 00:05:49,120 Speaker 3: sticking to your knitting and having the cash to deploy, 107 00:05:49,960 --> 00:05:52,040 Speaker 3: you know, down five and down ten, which we think 108 00:05:52,080 --> 00:05:54,839 Speaker 3: we might see multiple times on the way to seventy 109 00:05:54,880 --> 00:05:56,200 Speaker 3: seven to fifty by year end. 110 00:05:56,320 --> 00:05:59,880 Speaker 2: With us Julian, Emanuel Evercore, Isa, we welcome all of 111 00:06:00,080 --> 00:06:03,880 Speaker 2: you here to the Lisa Matteo Hour, Bloomberg surveillance worldwide 112 00:06:03,920 --> 00:06:06,880 Speaker 2: across the nation. Lisa Mateo, Michael Barr, Paul Sweeney. We're 113 00:06:06,920 --> 00:06:09,560 Speaker 2: all back together. It's amazing. Are we have any group 114 00:06:09,640 --> 00:06:10,480 Speaker 2: lunch today? Oh? 115 00:06:10,520 --> 00:06:13,159 Speaker 4: I don't know what McDonald's avenue. 116 00:06:13,880 --> 00:06:17,360 Speaker 2: That window seat and this cold is just really remarkable. 117 00:06:17,400 --> 00:06:19,360 Speaker 2: We say good morning with our coverage from the World 118 00:06:19,440 --> 00:06:22,840 Speaker 2: Economic Forum as well, lots of people. Howard Lutnick, I'm 119 00:06:22,839 --> 00:06:26,200 Speaker 2: totally be with us tomorrow. Other worthies here today, including 120 00:06:26,240 --> 00:06:29,719 Speaker 2: the leadership of Morgan Stanley, the way you listen to us, 121 00:06:29,839 --> 00:06:32,799 Speaker 2: Thank you, Nathan Hagar Radio ninety nine to one FM 122 00:06:32,839 --> 00:06:36,840 Speaker 2: in Washington, ninety two to nine FM, Good Morning in Boston, 123 00:06:37,200 --> 00:06:40,280 Speaker 2: Bloomberg eleven three to zero in New York, and on YouTube. 124 00:06:40,720 --> 00:06:43,599 Speaker 2: I just can't say enough, folks, how I'm learning about 125 00:06:43,600 --> 00:06:46,960 Speaker 2: this digital experiment each and every day. Subscribe how dot 126 00:06:47,000 --> 00:06:50,960 Speaker 2: YouTube to Bloomberg podcast. That's what Julian Emmanuel does. Paul 127 00:06:51,000 --> 00:06:53,200 Speaker 2: Sweeney with mister Emmanuel, Julian. 128 00:06:53,240 --> 00:06:54,480 Speaker 4: What are we doing in the bond market here? 129 00:06:54,520 --> 00:06:58,320 Speaker 5: Twenty twenty five was a really solid year for bond investors, 130 00:06:58,400 --> 00:06:59,839 Speaker 5: high single digit total returns. 131 00:06:59,839 --> 00:07:02,599 Speaker 4: Here are we just clipping coupons? Maybe in twenty six. 132 00:07:03,120 --> 00:07:06,040 Speaker 3: I think it's a little bit more complicated here. Look, 133 00:07:06,480 --> 00:07:09,200 Speaker 3: first of all, if we knew nothing else, the idea 134 00:07:09,320 --> 00:07:13,160 Speaker 3: that Japanese yields are exploding, and that increases the global 135 00:07:13,440 --> 00:07:16,840 Speaker 3: competition for capital, it has to put upward pressure on 136 00:07:16,880 --> 00:07:22,680 Speaker 3: our yields. You know. Again, lots of expansion plans, you know, 137 00:07:22,920 --> 00:07:26,160 Speaker 3: getting involved in lots of other countries and territories. All 138 00:07:26,240 --> 00:07:29,960 Speaker 3: of that, plus the midterms, there's going to be ok 139 00:07:30,200 --> 00:07:31,760 Speaker 3: fiscal expansion brilliant. 140 00:07:31,760 --> 00:07:34,000 Speaker 2: We're gonna stop the show right now, folks, because this 141 00:07:34,080 --> 00:07:36,920 Speaker 2: is the research item of the moment. With all the 142 00:07:36,960 --> 00:07:40,800 Speaker 2: comments from the Secretary of Treasury yesterday, Julian, I'm in 143 00:07:40,840 --> 00:07:44,480 Speaker 2: the camp is you just stated that a four and 144 00:07:44,600 --> 00:07:48,400 Speaker 2: even Lizzie Saunders at Schwab said seven standard deviation move 145 00:07:48,440 --> 00:07:51,000 Speaker 2: in Japan. All you need to know, folks, is the 146 00:07:51,000 --> 00:07:54,960 Speaker 2: word big, big, a big move, price down, yield up. 147 00:07:55,120 --> 00:08:02,240 Speaker 2: It does affect American finance, the Greenland Davos, the President, 148 00:08:02,320 --> 00:08:06,280 Speaker 2: what's he going to say, Mark Currny's manchisterial speech yesterday? 149 00:08:06,720 --> 00:08:10,480 Speaker 2: Does that affect the finance world as well? Absolutely? 150 00:08:10,520 --> 00:08:13,840 Speaker 3: At the margin, all of that creates more volatility. And 151 00:08:13,920 --> 00:08:17,080 Speaker 3: again in a world where where I mean we have 152 00:08:17,120 --> 00:08:20,320 Speaker 3: to face it. The forty year secular bond bull market 153 00:08:20,520 --> 00:08:23,440 Speaker 3: ended in twenty twenty, and we're in a new higher 154 00:08:23,560 --> 00:08:27,160 Speaker 3: yield regime and we've gone sideways for three years and 155 00:08:27,200 --> 00:08:28,400 Speaker 3: that's likely going to end. 156 00:08:28,560 --> 00:08:31,240 Speaker 2: Stay with us. Have a Tito's and TG ed Heeimen 157 00:08:31,400 --> 00:08:33,640 Speaker 2: just called in and said, enough of Julian. We got 158 00:08:33,679 --> 00:08:36,400 Speaker 2: to get to Lisa Mattel right now from the Interactive 159 00:08:36,400 --> 00:08:40,120 Speaker 2: Broker Studios of Bloomberg Business Flash. Lisa, mate, you got it. 160 00:08:40,200 --> 00:08:43,079 Speaker 6: We got futures, Well, they're still lower this after yesterday's 161 00:08:43,080 --> 00:08:46,040 Speaker 6: self traders just awaiting President Trump's address at Davos, any 162 00:08:46,160 --> 00:08:49,640 Speaker 6: signs attentions might cool over Greenland. He's expected to talk 163 00:08:49,679 --> 00:08:52,040 Speaker 6: at eight thirty Wall Street time. We will keep you 164 00:08:52,120 --> 00:08:54,440 Speaker 6: updated on that. We go to an asset futures down 165 00:08:54,440 --> 00:08:57,280 Speaker 6: three tens of percent down, futures falling two tents of percent, 166 00:08:57,400 --> 00:08:59,760 Speaker 6: S and P futures off about a tenth of a percent. 167 00:09:00,080 --> 00:09:01,800 Speaker 6: In the yield space a two year a three point 168 00:09:01,840 --> 00:09:04,480 Speaker 6: five to seven percent, that's down two basis points. They 169 00:09:04,520 --> 00:09:06,600 Speaker 6: yield on the tenure four point two eight percent, and 170 00:09:06,600 --> 00:09:09,600 Speaker 6: that's down one basis point. To currency is the Bloomberg 171 00:09:09,640 --> 00:09:12,559 Speaker 6: Dollar Spot Index weakening by about a ten percent. More 172 00:09:12,600 --> 00:09:14,719 Speaker 6: earnings coming in. We're just hearing from Charles Schwab. It 173 00:09:14,760 --> 00:09:17,200 Speaker 6: looks like a beat on total net new assets for 174 00:09:17,240 --> 00:09:19,920 Speaker 6: the fourth quarter, but its cheers are down about two percent. 175 00:09:20,000 --> 00:09:23,160 Speaker 6: Still going through the data, a few stocks on the move. 176 00:09:23,240 --> 00:09:27,080 Speaker 6: We'll start with shares of craft Times. They are still lower. 177 00:09:27,080 --> 00:09:31,080 Speaker 6: They're down five percent worth. Its top shareholder, Berkshire Hathaway 178 00:09:31,160 --> 00:09:33,880 Speaker 6: might sell some or nearly all of its shares. 179 00:09:34,280 --> 00:09:35,000 Speaker 4: There's a filing. 180 00:09:35,080 --> 00:09:37,040 Speaker 6: Craft Tigne says it's pulling more than three hundred and 181 00:09:37,120 --> 00:09:40,000 Speaker 6: twenty five million common shares of Berkshire Hathaway up for 182 00:09:40,120 --> 00:09:45,000 Speaker 6: a potential sale. And finally, Berbery's holiday sales beat expectations 183 00:09:45,040 --> 00:09:47,640 Speaker 6: same store sale growth three to six percent gain in 184 00:09:47,679 --> 00:09:50,920 Speaker 6: Greater China. It also flags strong interest from gen Z. 185 00:09:51,280 --> 00:09:54,200 Speaker 6: Shares up four percent in London. That's your Bloomberg business 186 00:09:54,200 --> 00:09:55,880 Speaker 6: flash all in, Tom, at least. 187 00:09:55,679 --> 00:09:57,679 Speaker 2: Of things, so much was coming up the senator from 188 00:09:57,679 --> 00:10:00,719 Speaker 2: North Carolina and mister till is making a huge splash. 189 00:10:00,840 --> 00:10:04,480 Speaker 2: And Davis, that'll be a good conversation with Jonathan feral. 190 00:10:04,280 --> 00:10:06,520 Speaker 5: Pul Tom, what I look about Julian's notes here because 191 00:10:06,520 --> 00:10:10,240 Speaker 5: he has investment ideas stuff to do. So here's one 192 00:10:10,480 --> 00:10:14,560 Speaker 5: buy WTI oil Straddles. I'm ready to do that, but 193 00:10:14,559 --> 00:10:16,400 Speaker 5: I have no idea what that means. What are we 194 00:10:16,440 --> 00:10:17,120 Speaker 5: doing here with oil? 195 00:10:17,200 --> 00:10:21,200 Speaker 3: So basically, if you think about Iran, there are many, 196 00:10:21,320 --> 00:10:25,200 Speaker 3: many possible outcomes along the way, and you take the 197 00:10:25,240 --> 00:10:31,240 Speaker 3: backdrop that of all of the initiatives on promoting affordability, 198 00:10:31,640 --> 00:10:36,160 Speaker 3: the Trump administration has been uniformly extremely successful and keep 199 00:10:36,280 --> 00:10:38,760 Speaker 3: in keeping the price of oil and gasoline at the 200 00:10:38,760 --> 00:10:41,880 Speaker 3: pump down. But Iran, could you know, you could have 201 00:10:41,960 --> 00:10:46,599 Speaker 3: a spike higher, you could go lower subsequently if the 202 00:10:46,840 --> 00:10:49,920 Speaker 3: if the if there's regime change and ended up being 203 00:10:49,920 --> 00:10:53,440 Speaker 3: pro Western. So basically, what we're saying is the oil 204 00:10:53,520 --> 00:10:57,880 Speaker 3: market is likely to experience much higher volatility in the 205 00:10:57,920 --> 00:11:01,199 Speaker 3: next few months. And that's the way owning Straddles puts 206 00:11:01,240 --> 00:11:03,680 Speaker 3: and calls the way you take advantage of that. 207 00:11:04,000 --> 00:11:07,160 Speaker 4: All right, Tommyan, I'm in on that some question. 208 00:11:07,600 --> 00:11:11,559 Speaker 2: I think it's everybody's readjusting here. But I'm sorry, Julian, 209 00:11:11,600 --> 00:11:14,679 Speaker 2: we're all buffeted by this, you know. I mean, it's 210 00:11:14,720 --> 00:11:17,440 Speaker 2: an advantage for me. People are paying attention. Thank you 211 00:11:17,520 --> 00:11:20,920 Speaker 2: for that, folks, But how do you manage. I mean, folks, 212 00:11:21,040 --> 00:11:26,240 Speaker 2: you have to understand the evercore isi heritage of Roger 213 00:11:26,320 --> 00:11:29,640 Speaker 2: Altman and the team and Edward Hyman is a long 214 00:11:29,760 --> 00:11:35,160 Speaker 2: term approach in all of these people astutely watch the news. 215 00:11:35,600 --> 00:11:38,280 Speaker 2: How do you do that? How do you actually execute 216 00:11:38,559 --> 00:11:42,640 Speaker 2: a Julian emmanual approach with the focus that Roger Alman 217 00:11:42,679 --> 00:11:45,240 Speaker 2: and Ed Hyman have on the day to day news. 218 00:11:45,360 --> 00:11:48,880 Speaker 3: Well, I think it starts with the concept of thinking 219 00:11:48,920 --> 00:11:52,480 Speaker 3: about investing long term, which is why we continue to 220 00:11:52,520 --> 00:11:55,760 Speaker 3: say with all this noise, yes, the market's going to 221 00:11:55,800 --> 00:12:00,800 Speaker 3: be more volatile, but the underlying theme of structural positivity 222 00:12:00,920 --> 00:12:04,280 Speaker 3: because of the AI revolution is likely to carry stock 223 00:12:04,320 --> 00:12:05,040 Speaker 3: prices higher. 224 00:12:05,040 --> 00:12:05,920 Speaker 4: But then the. 225 00:12:05,920 --> 00:12:08,400 Speaker 3: Other thing, it just comes down to having the Bloomberg 226 00:12:08,440 --> 00:12:11,400 Speaker 3: feed coming in on your phone and into your head. 227 00:12:11,480 --> 00:12:12,360 Speaker 3: Twenty four to seven. 228 00:12:12,480 --> 00:12:13,160 Speaker 4: Gotta do it. 229 00:12:13,240 --> 00:12:15,040 Speaker 2: I gotta get set up here for the Senator from 230 00:12:15,040 --> 00:12:18,160 Speaker 2: North Carolina, you mentioned the midterm elections. Where I am 231 00:12:18,360 --> 00:12:22,200 Speaker 2: in January, is we're having in April conversation. We're sort 232 00:12:22,200 --> 00:12:24,920 Speaker 2: of speeding up the whole discussion. Is that the way 233 00:12:24,960 --> 00:12:25,480 Speaker 2: you see. 234 00:12:25,320 --> 00:12:30,000 Speaker 3: It, look absolutely the one big beautiful bill, the tax 235 00:12:30,120 --> 00:12:33,040 Speaker 3: benefits are going to kick in in a month or two, 236 00:12:33,800 --> 00:12:38,360 Speaker 3: and then they're likely to be more stimuli, more initiative. 237 00:12:39,320 --> 00:12:43,439 Speaker 2: It's like, you know, Bob Michael gip stimuli, stimuli, yep, 238 00:12:43,760 --> 00:12:46,320 Speaker 2: And are we going to stimuli ourselves to a Q 239 00:12:46,400 --> 00:12:50,240 Speaker 2: two and Q three double digit earnings. 240 00:12:50,360 --> 00:12:52,720 Speaker 3: The way it looks now, it's entirely likely. 241 00:12:52,840 --> 00:12:53,040 Speaker 4: Yes. 242 00:12:54,120 --> 00:12:57,240 Speaker 5: So the earning story, we're just kind of getting into 243 00:12:57,480 --> 00:12:59,880 Speaker 5: the crux of it right now. One thing that's kind 244 00:12:59,880 --> 00:13:02,720 Speaker 5: of I think still quite concerning to some investors is 245 00:13:02,880 --> 00:13:05,959 Speaker 5: the persistent softest in the US dollar. I mean, we've 246 00:13:06,000 --> 00:13:09,040 Speaker 5: seen stocks bounce back, we've seen a lot of other 247 00:13:09,120 --> 00:13:12,079 Speaker 5: risk assets bounce back from the April lows of last year. 248 00:13:12,080 --> 00:13:13,400 Speaker 4: We haven't seen a dollar bounce back. 249 00:13:13,480 --> 00:13:13,560 Speaker 2: No. 250 00:13:14,320 --> 00:13:19,440 Speaker 3: Well, and again, if you're a corporate America, you actually 251 00:13:19,480 --> 00:13:23,360 Speaker 3: prefer a week or dollar and so that's good if 252 00:13:23,360 --> 00:13:27,160 Speaker 3: you're multinational. But frankly, the other part of the story there, 253 00:13:27,360 --> 00:13:31,080 Speaker 3: and we talked about this, is the whole asset diversification 254 00:13:31,559 --> 00:13:35,880 Speaker 3: from this concentration in the US assets. And broadly speaking, 255 00:13:36,280 --> 00:13:38,400 Speaker 3: over the long stretch, if you look at the last 256 00:13:38,720 --> 00:13:42,600 Speaker 3: period of dollar weakness sustained two thousand and one to 257 00:13:42,640 --> 00:13:45,520 Speaker 3: two thousand and seven, that was a pretty good time 258 00:13:45,559 --> 00:13:46,720 Speaker 3: for the global economy. 259 00:13:47,280 --> 00:13:48,800 Speaker 2: I've got to slip one morning and then we're going 260 00:13:48,840 --> 00:13:51,600 Speaker 2: to start talking about the Senator from North Cara, Atlina. 261 00:13:52,040 --> 00:13:55,599 Speaker 2: You own earnings analysis, You've taken the high ground with 262 00:13:55,679 --> 00:14:00,640 Speaker 2: a must read every morning research note. Can strap al 263 00:14:00,679 --> 00:14:03,600 Speaker 2: it out an SPX call? I mean, do you have 264 00:14:03,720 --> 00:14:06,439 Speaker 2: like like a Yard Denny out one year? Even a 265 00:14:06,520 --> 00:14:09,680 Speaker 2: Julian Emmanuel two year call. 266 00:14:09,920 --> 00:14:13,400 Speaker 3: It's a little trickier now to go past one year, 267 00:14:13,480 --> 00:14:16,680 Speaker 3: simply because when you think about the dynamics of twenty 268 00:14:16,720 --> 00:14:20,640 Speaker 3: twenty six, first of all, just you know, bull markets 269 00:14:20,640 --> 00:14:24,400 Speaker 3: don't end on valuation alone. They end with the recessions, 270 00:14:24,600 --> 00:14:27,840 Speaker 3: They end with a hiking FED. They end with you know, 271 00:14:28,080 --> 00:14:30,960 Speaker 3: yields in the fives or the sixes, which we don't 272 00:14:31,000 --> 00:14:34,440 Speaker 3: see at this point, right, and they end with a 273 00:14:34,480 --> 00:14:37,800 Speaker 3: massive amount of FOMO. None of those are in place 274 00:14:37,960 --> 00:14:42,160 Speaker 3: right now? Could they be? Absolutely? Given the fact that 275 00:14:42,200 --> 00:14:45,360 Speaker 3: you have all the stimulus in the pipeline and a 276 00:14:45,440 --> 00:14:48,880 Speaker 3: FED likely to cut into the midterms, could there be 277 00:14:48,920 --> 00:14:51,880 Speaker 3: a hangover in twenty twenty seven? Right, We'll have to 278 00:14:51,920 --> 00:14:55,680 Speaker 3: see not our base case, but certainly a risk case. 279 00:14:56,280 --> 00:14:58,400 Speaker 2: I need you Julian can you come in like every 280 00:14:58,440 --> 00:15:01,920 Speaker 2: ten days, fourteen days here Roderick calendar. You know, if 281 00:15:01,920 --> 00:15:02,440 Speaker 2: you can do it. 282 00:15:02,720 --> 00:15:05,360 Speaker 4: D certainly during earning season. 283 00:15:05,480 --> 00:15:06,720 Speaker 7: I give my team the credit. 284 00:15:06,920 --> 00:15:09,840 Speaker 2: We were sent market cap so nineteen percent when it's 285 00:15:09,880 --> 00:15:12,240 Speaker 2: in twenty nine percent, and I think it's a good 286 00:15:12,240 --> 00:15:15,920 Speaker 2: But Julian Emmanuel Abercore is I stay with us. More 287 00:15:16,040 --> 00:15:18,920 Speaker 2: from Bloomberg Surveillance coming up after this. 288 00:15:26,160 --> 00:15:29,760 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us Live 289 00:15:29,840 --> 00:15:32,960 Speaker 1: weekday afternoons from seven to ten am Eastern. Listen on 290 00:15:33,080 --> 00:15:36,720 Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or 291 00:15:36,880 --> 00:15:38,320 Speaker 1: watch us Live on YouTube. 292 00:15:38,520 --> 00:15:42,080 Speaker 2: Right now, Jonathan Maxwell and eclectic set of conversations to 293 00:15:42,200 --> 00:15:46,880 Speaker 2: prepare you for the president's speech. Jonathan, you know it's timely. 294 00:15:46,920 --> 00:15:49,440 Speaker 2: I had a tantrum like three days ago, and I said, 295 00:15:49,480 --> 00:15:52,160 Speaker 2: I don't care. Get me someone with a modern history 296 00:15:52,200 --> 00:15:55,400 Speaker 2: degree from Oxford That's what we get. Have you ever 297 00:15:55,440 --> 00:15:57,280 Speaker 2: seen a modern history like this? 298 00:15:58,080 --> 00:16:00,160 Speaker 4: I mean kind of that. 299 00:16:00,200 --> 00:16:03,520 Speaker 7: We've spent the last modern history since the post of 300 00:16:03,560 --> 00:16:06,440 Speaker 7: Second World War. A lot of it has been about 301 00:16:06,440 --> 00:16:10,640 Speaker 7: competition for resources, right and particularly fossil fuels. What we're 302 00:16:10,640 --> 00:16:13,600 Speaker 7: seeing now is a different arena emerging for where that 303 00:16:13,640 --> 00:16:16,160 Speaker 7: competition is flowering up. And you know I've described it. 304 00:16:16,200 --> 00:16:18,520 Speaker 7: I read a book about this called the Age. I 305 00:16:18,520 --> 00:16:20,840 Speaker 7: think we're at a real age moment in history, right, 306 00:16:20,880 --> 00:16:24,479 Speaker 7: But there are several edge moments. These are flashpoints, geopolitical 307 00:16:24,520 --> 00:16:29,080 Speaker 7: flash brains where you find energy and capital coming together 308 00:16:29,160 --> 00:16:33,040 Speaker 7: and flashing up. Arctic obviously it's the big one ever. 309 00:16:33,040 --> 00:16:37,120 Speaker 2: Bring the script. We're supposed to talk about Venezuela. That's 310 00:16:37,240 --> 00:16:40,920 Speaker 2: yesterday's news. I want to talk to you about the 311 00:16:40,960 --> 00:16:45,600 Speaker 2: new focus on the Arctic. Americans, like our subtotal is 312 00:16:45,640 --> 00:16:49,400 Speaker 2: we watched ice Station Zebra a million years ago and 313 00:16:49,680 --> 00:16:51,920 Speaker 2: I'm sorry folks in the continent of Europe and the 314 00:16:52,000 --> 00:16:56,160 Speaker 2: United Kingdom, they're way way more astute on this. When 315 00:16:56,200 --> 00:16:59,880 Speaker 2: Elizabeth Economy writes and Foreign Affairs about the Artic Ocean, yeah, 316 00:17:00,040 --> 00:17:03,920 Speaker 2: with that authority, right, or someone like you, it's sustainable 317 00:17:03,960 --> 00:17:07,240 Speaker 2: development with that authority. What's the number one thing my 318 00:17:07,359 --> 00:17:10,800 Speaker 2: audience needs to know about the myths of the. 319 00:17:10,760 --> 00:17:13,399 Speaker 7: Art Okay, So I would say that, think about the 320 00:17:13,440 --> 00:17:16,920 Speaker 7: difference in the ocean and the crust. So what joins 321 00:17:17,000 --> 00:17:21,520 Speaker 7: Greenland to Russia is something called the Lamana saufrage, the 322 00:17:21,640 --> 00:17:25,000 Speaker 7: lahmana savage. Okay, it's where my book starts. Actually in 323 00:17:25,040 --> 00:17:29,160 Speaker 7: the Arctic. In two thousand and seven, Vladimir Putin started 324 00:17:29,160 --> 00:17:31,760 Speaker 7: to extract natural gas underneath the North Park. 325 00:17:31,920 --> 00:17:33,680 Speaker 2: What happens is in the beginning of the book, it's 326 00:17:33,720 --> 00:17:36,320 Speaker 2: like Stravinus's book Submarine comes. 327 00:17:36,080 --> 00:17:39,119 Speaker 7: Up to this. Bless you for having read, Thank you 328 00:17:39,160 --> 00:17:42,280 Speaker 7: so much. But I think, what to talk about something 329 00:17:42,280 --> 00:17:45,440 Speaker 7: that other people aren't necessarily talking about? This Lamano saffa ridge, 330 00:17:46,119 --> 00:17:49,440 Speaker 7: the laws of the Sea by which by the way, 331 00:17:49,440 --> 00:17:52,480 Speaker 7: the United States has signed up to, but that anybody 332 00:17:52,520 --> 00:17:57,720 Speaker 7: within two hundred miles can claim the resources under the Arctic, right, 333 00:17:57,800 --> 00:18:00,640 Speaker 7: So what are the resources under the Arctic? Maybe thirteen 334 00:18:00,680 --> 00:18:03,359 Speaker 7: percent of the world's oil, maybe twenty or thirty percent 335 00:18:03,400 --> 00:18:06,840 Speaker 7: of the world's undiscovered or unexploited natural gas. Then you've 336 00:18:06,840 --> 00:18:08,600 Speaker 7: got all the minerals, and then of course you've got 337 00:18:08,640 --> 00:18:11,639 Speaker 7: the shipping lanes, you've got the geopolitical issues. So this 338 00:18:11,760 --> 00:18:14,399 Speaker 7: is where submarines and you've got submarines, and you know, 339 00:18:14,480 --> 00:18:16,520 Speaker 7: I think a lot of your listeners who are informed 340 00:18:16,560 --> 00:18:18,679 Speaker 7: about this may say, wait, this is going to be 341 00:18:18,800 --> 00:18:21,600 Speaker 7: very expensive. It's very difficult to extract the oil and gas. 342 00:18:21,600 --> 00:18:23,919 Speaker 7: Sometimes you do things to stop other people doing it. Now, 343 00:18:24,000 --> 00:18:28,200 Speaker 7: the other people claiming these resources because they claim ownership 344 00:18:28,680 --> 00:18:32,880 Speaker 7: directly or indirectly of Russia and China, so to some 345 00:18:33,000 --> 00:18:37,600 Speaker 7: degree ownership of Greenland it gives you that nexus. Salomonosov 346 00:18:37,720 --> 00:18:40,399 Speaker 7: Ridge ownership is also I think everybody's been scratching here. 347 00:18:40,440 --> 00:18:41,639 Speaker 7: Why do we need to own it? If we can 348 00:18:41,640 --> 00:18:45,120 Speaker 7: put military bases there and help control shipping lanes, there 349 00:18:45,119 --> 00:18:47,560 Speaker 7: are other things. Of course, you've got the resources. There 350 00:18:47,600 --> 00:18:50,720 Speaker 7: is also and this is a little early to be 351 00:18:50,800 --> 00:18:52,800 Speaker 7: saying this, but of course it's very cool. It's all 352 00:18:52,920 --> 00:18:56,520 Speaker 7: hydropower renewable. If you did happen to want to locate 353 00:18:56,520 --> 00:18:58,159 Speaker 7: a data centerday, you don't need to spend a lot 354 00:18:58,200 --> 00:19:02,280 Speaker 7: of money cooling the thing. So there are geostrategic reasons 355 00:19:02,320 --> 00:19:05,560 Speaker 7: linked to energy flows, linked to minerals, and also linked 356 00:19:05,560 --> 00:19:08,080 Speaker 7: to the what I would describe as the Fifth Industrial Revolution. 357 00:19:08,560 --> 00:19:10,680 Speaker 5: Do we again, I guess the question that a lot 358 00:19:10,720 --> 00:19:13,119 Speaker 5: of lay people like my software asking at this point, 359 00:19:13,160 --> 00:19:16,800 Speaker 5: given our limited knowledge of the geopolitics of Greenland, do 360 00:19:16,840 --> 00:19:19,639 Speaker 5: we need to own it or do we have you know, 361 00:19:19,880 --> 00:19:22,520 Speaker 5: already access to it as of right now. 362 00:19:22,640 --> 00:19:24,960 Speaker 7: I think I think the answer is, you know, obviously, 363 00:19:25,280 --> 00:19:27,439 Speaker 7: you know you have access to it right now. You 364 00:19:27,440 --> 00:19:30,040 Speaker 7: can put military basis there. You've got a matter of extraction, 365 00:19:30,200 --> 00:19:34,000 Speaker 7: right I think. I think the difference with ownership is 366 00:19:34,040 --> 00:19:36,280 Speaker 7: what it stops other people doing. Go back to the 367 00:19:36,280 --> 00:19:38,000 Speaker 7: point that I made before, which I don't think is 368 00:19:38,000 --> 00:19:40,440 Speaker 7: on the table at the moment in the mainstream media. 369 00:19:40,640 --> 00:19:43,320 Speaker 7: The amount of softwadge is crust. It's not ocean. The 370 00:19:43,400 --> 00:19:45,719 Speaker 7: crust gives you geostrategic control. 371 00:19:45,920 --> 00:19:50,680 Speaker 2: I'm begging, begging, begging, can you come back for a lengthy. 372 00:19:50,320 --> 00:19:52,560 Speaker 7: Discussion with the greatest level. 373 00:19:52,680 --> 00:19:53,720 Speaker 2: Are you based in New York? 374 00:19:53,800 --> 00:19:55,560 Speaker 7: I'm based in London, but I'm here every three weeks. 375 00:19:55,880 --> 00:19:56,720 Speaker 2: Every weeks is. 376 00:19:57,080 --> 00:19:58,720 Speaker 4: Why are we more than every three weeks? We could 377 00:19:58,760 --> 00:19:58,960 Speaker 4: do that? 378 00:19:59,320 --> 00:20:01,800 Speaker 2: Well? A lot of people ask why that is? I mean, 379 00:20:01,880 --> 00:20:04,000 Speaker 2: you know, I mean the bartender at the Net asked 380 00:20:04,000 --> 00:20:06,480 Speaker 2: me last night, why aren't you in London every three weeks? 381 00:20:06,960 --> 00:20:09,600 Speaker 2: This has been seriously, this has been Jonathan Maxwell, this 382 00:20:09,640 --> 00:20:15,440 Speaker 2: has been absolutely spectacular. Stay with us. More from Bloomberg 383 00:20:15,560 --> 00:20:17,600 Speaker 2: Surveillance coming up after this. 384 00:20:24,840 --> 00:20:28,440 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us Live 385 00:20:28,480 --> 00:20:31,639 Speaker 1: weekday afternoons from seven to ten am Eastern. Listen on 386 00:20:31,720 --> 00:20:35,399 Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or 387 00:20:35,560 --> 00:20:37,040 Speaker 1: watch US Live on YouTube. 388 00:20:37,320 --> 00:20:40,400 Speaker 2: Joining US Now Dana Telsey for Too Short a conversation 389 00:20:41,080 --> 00:20:45,320 Speaker 2: definitive on Fashioned Telsey Advisory Group in retail as well. Okay, 390 00:20:45,600 --> 00:20:49,080 Speaker 2: I'm going to defend my good friend Maria Bartiromo. She 391 00:20:49,320 --> 00:20:53,720 Speaker 2: is rocking the Audrey charade. Look over at Fox She's 392 00:20:53,720 --> 00:20:57,880 Speaker 2: got the Oliver Goldsmith sunglasses in the hat which looks 393 00:20:57,960 --> 00:21:00,919 Speaker 2: like cscful what's his name? From another time and place, 394 00:21:01,119 --> 00:21:04,760 Speaker 2: and she's getting trashed. I want you to talk about 395 00:21:04,800 --> 00:21:09,000 Speaker 2: how in fashion a former era becomes a style like 396 00:21:09,200 --> 00:21:12,320 Speaker 2: rock and Audrey over at Fox Biz it does. 397 00:21:12,520 --> 00:21:15,399 Speaker 8: You always need newness in order to show something different 398 00:21:15,720 --> 00:21:19,040 Speaker 8: that makes people want to emulate, that makes people want 399 00:21:19,040 --> 00:21:22,399 Speaker 8: to buy drives conversion. The past is the history of 400 00:21:22,440 --> 00:21:23,240 Speaker 8: the future. 401 00:21:22,920 --> 00:21:26,600 Speaker 2: And the Devil War's product. It's about risk. What's the 402 00:21:26,760 --> 00:21:29,480 Speaker 2: risk right now? Like Maria's out there getting hung out 403 00:21:29,480 --> 00:21:31,960 Speaker 2: to drive, what's the risk right now? In the data 404 00:21:32,040 --> 00:21:32,840 Speaker 2: Telsea world? 405 00:21:33,280 --> 00:21:34,919 Speaker 8: I mean, we've seen a little bit of it with 406 00:21:35,000 --> 00:21:38,159 Speaker 8: sax bankruptcy and what happens to all the vendors. You 407 00:21:38,240 --> 00:21:41,320 Speaker 8: look at what everyone has owned. It's harder for smaller 408 00:21:41,400 --> 00:21:45,080 Speaker 8: vendors to come to come to fruition if they don't 409 00:21:45,080 --> 00:21:46,040 Speaker 8: have places to sell. 410 00:21:46,040 --> 00:21:46,359 Speaker 9: Anyone. 411 00:21:46,560 --> 00:21:50,200 Speaker 2: Isabel bard Is on like six gazillion dollars, I mean 412 00:21:50,359 --> 00:21:52,080 Speaker 2: serious stuff, it's big money. 413 00:21:52,119 --> 00:21:54,239 Speaker 4: Give us your perspective of Sax and the bankers fry there. 414 00:21:54,240 --> 00:21:56,280 Speaker 5: I mean, I'm not a retail person, but I know 415 00:21:56,400 --> 00:21:59,080 Speaker 5: the value of the Sax brand and that just shocked 416 00:21:59,119 --> 00:22:00,640 Speaker 5: me as a layperson to see that happen. 417 00:22:00,920 --> 00:22:04,119 Speaker 8: It shocks everyone to see it happen. Most importantly, shocks 418 00:22:04,119 --> 00:22:06,560 Speaker 8: the brands. And what does it give to the consumers? 419 00:22:06,760 --> 00:22:10,240 Speaker 8: You know who benefits Macy's and Bloomingdale's. Go across the 420 00:22:10,240 --> 00:22:13,040 Speaker 8: street to Bloomingdale's. You look at the fourth floor where 421 00:22:13,040 --> 00:22:16,280 Speaker 8: they expanded the brands, and it looks terrific. Bloomingdale's and 422 00:22:16,320 --> 00:22:18,840 Speaker 8: nord Strums are going to benefit because the brands of 423 00:22:19,040 --> 00:22:20,840 Speaker 8: places to sell, they can get paid. 424 00:22:20,880 --> 00:22:24,480 Speaker 2: Why did Bloomingdale's not do a sex for the avenue 425 00:22:24,560 --> 00:22:29,200 Speaker 2: is an execution by retail people over fancy pants real 426 00:22:29,280 --> 00:22:32,120 Speaker 2: estate people. She's got the burnder of Goodman eyes right 427 00:22:32,160 --> 00:22:35,359 Speaker 2: now for her child, which exactly you know, it's about 428 00:22:35,400 --> 00:22:36,480 Speaker 2: retail execution. 429 00:22:37,040 --> 00:22:40,119 Speaker 8: It's about the logic and the magic. They were able 430 00:22:40,160 --> 00:22:44,040 Speaker 8: to take the brands and the bills, be able to 431 00:22:44,160 --> 00:22:47,640 Speaker 8: manage it with yes, the people who manage it, frankly, 432 00:22:47,880 --> 00:22:50,840 Speaker 8: the margins, the profitability and the volume all at the 433 00:22:50,840 --> 00:22:53,800 Speaker 8: same time. But it's not easy and it wasn't always 434 00:22:53,800 --> 00:22:57,360 Speaker 8: that way. But under Tony Spring, they're bringing the Bold 435 00:22:57,480 --> 00:22:58,840 Speaker 8: News chapter to today. 436 00:22:59,480 --> 00:23:01,879 Speaker 2: Lisa, I got to interrupt the show here, should we 437 00:23:01,880 --> 00:23:04,800 Speaker 2: have a new slogan for Bloomberg Surveillance about the logic 438 00:23:04,840 --> 00:23:09,040 Speaker 2: and the magic? Did that work? Bloomberg Surveillance? That's great. 439 00:23:09,080 --> 00:23:10,800 Speaker 2: Paul Sweeney with data tell seeing. 440 00:23:10,600 --> 00:23:13,200 Speaker 5: We've got a little bit of a look back here. 441 00:23:13,240 --> 00:23:16,320 Speaker 4: How was the holiday selling season for retailers? 442 00:23:16,359 --> 00:23:20,000 Speaker 8: Good holiday selling seasons. People are very resilient. We've seen 443 00:23:20,040 --> 00:23:22,840 Speaker 8: the increases anywhere from three and a half to just 444 00:23:22,920 --> 00:23:26,560 Speaker 8: over four percent. There was the Lola's Usual from Black 445 00:23:26,600 --> 00:23:27,720 Speaker 8: Friday to Christmas. 446 00:23:27,880 --> 00:23:29,200 Speaker 9: Then it picked up and you know what. 447 00:23:29,240 --> 00:23:32,280 Speaker 8: Drove it the fact that a lot of the particularly 448 00:23:32,280 --> 00:23:35,240 Speaker 8: on the apparel side, goods that people hadn't bought before, 449 00:23:35,480 --> 00:23:38,199 Speaker 8: they were buying along with they were going out. So 450 00:23:38,240 --> 00:23:41,359 Speaker 8: it wasn't just as casual as can get because people 451 00:23:41,400 --> 00:23:43,000 Speaker 8: went to occasions and events. 452 00:23:43,440 --> 00:23:45,480 Speaker 5: What are we looking for for twenty twenty six? What 453 00:23:45,480 --> 00:23:47,119 Speaker 5: are some of the themes the trends you're looking for 454 00:23:47,160 --> 00:23:47,679 Speaker 5: in your return? 455 00:23:47,800 --> 00:23:52,920 Speaker 8: My line is assortment and advertising drive appreciation. I think 456 00:23:52,960 --> 00:23:57,880 Speaker 8: the merchandise mix has got to be different, whether it's influencers, partnerships, collaborations. 457 00:23:58,080 --> 00:24:00,680 Speaker 8: How are you going to capture people's attention then we'll 458 00:24:00,760 --> 00:24:01,200 Speaker 8: drive stock. 459 00:24:01,359 --> 00:24:05,119 Speaker 5: Are the retailers are they savvy about you know, all 460 00:24:05,160 --> 00:24:09,080 Speaker 5: the influencers that Tom you know, favors on social media? 461 00:24:09,160 --> 00:24:11,320 Speaker 4: I mean, did they know how to engage with those people? 462 00:24:12,440 --> 00:24:15,120 Speaker 2: Main repellers started it? 463 00:24:15,480 --> 00:24:16,119 Speaker 9: You bet they do. 464 00:24:16,280 --> 00:24:18,639 Speaker 8: I Mean one of the new metrics that companies are 465 00:24:18,680 --> 00:24:21,680 Speaker 8: talking about on a quarterly basis is how many new 466 00:24:21,720 --> 00:24:22,960 Speaker 8: customers they captured. 467 00:24:23,200 --> 00:24:26,680 Speaker 9: And everyone wants younger customers today. We just saw it. 468 00:24:27,000 --> 00:24:30,480 Speaker 8: Look at Birberry Burbery's results today for the holiday season 469 00:24:30,680 --> 00:24:34,920 Speaker 8: were pretty good and the strength of outerwear continued into 470 00:24:34,960 --> 00:24:38,480 Speaker 8: accessories like handbags because they went to what's iconic for 471 00:24:38,560 --> 00:24:41,919 Speaker 8: them and heritage with outerwear and now they've expanded it 472 00:24:41,960 --> 00:24:44,040 Speaker 8: and did come on, they went back to basics. 473 00:24:44,080 --> 00:24:46,760 Speaker 2: Missus Keene is rocking the casing from and don't. 474 00:24:46,560 --> 00:24:47,520 Speaker 9: Forget the Gabardine. 475 00:24:47,520 --> 00:24:52,000 Speaker 2: Also whatever is they're they're doing, and folks with Daniel 476 00:24:52,000 --> 00:24:54,040 Speaker 2: Telsey with us and this is a joy to have 477 00:24:54,080 --> 00:24:56,719 Speaker 2: her here picking up the pieces. On retails, Paul mentioned 478 00:24:56,960 --> 00:24:59,760 Speaker 2: the bankruptcy is Sex with the Avenue is riveted Bloomberg 479 00:25:00,080 --> 00:25:02,720 Speaker 2: and three in New York, we're rooveted by the World 480 00:25:02,760 --> 00:25:06,280 Speaker 2: Economic Forums. Just throw up that imagery right now. It's 481 00:25:06,320 --> 00:25:09,119 Speaker 2: a dark in the Roman at the World Economic Forum, 482 00:25:09,200 --> 00:25:11,520 Speaker 2: it is a packed room again thanks to Ian Bremer 483 00:25:11,600 --> 00:25:15,440 Speaker 2: for images of really literally I'm not kidding, a thousand 484 00:25:15,480 --> 00:25:18,960 Speaker 2: people maybe more awaiting the President of the United States 485 00:25:19,000 --> 00:25:21,639 Speaker 2: and will bring all that to you worldwide. And of 486 00:25:21,640 --> 00:25:26,400 Speaker 2: course on YouTube is well does cold weather help retail? 487 00:25:26,480 --> 00:25:29,440 Speaker 2: I'm in Paris and like we all get off the airplane. 488 00:25:29,480 --> 00:25:31,840 Speaker 2: It's like, oh mg, it's cold. And I go to 489 00:25:32,080 --> 00:25:35,360 Speaker 2: a famous store at twenty four roof Oberg and I'm 490 00:25:35,400 --> 00:25:38,119 Speaker 2: standing there and all of New York is buying cold 491 00:25:38,119 --> 00:25:41,480 Speaker 2: weather gear? Is that what happens now in cold America? 492 00:25:41,600 --> 00:25:42,240 Speaker 9: Yes it does. 493 00:25:42,359 --> 00:25:45,680 Speaker 8: You're seeing it both for outerwear, for scarves, hats and gloves. 494 00:25:45,920 --> 00:25:48,560 Speaker 8: Look at today here in New York right fifteen degrees 495 00:25:48,560 --> 00:25:50,159 Speaker 8: with a real feel of nine degrees. 496 00:25:50,200 --> 00:25:52,520 Speaker 9: You better be by I'm the dazzler right now. 497 00:25:53,160 --> 00:25:57,879 Speaker 2: Mountclear just stole the Botaga Vanada person this morning. Is 498 00:25:58,119 --> 00:26:01,240 Speaker 2: you're dazzled me see not front, I'm out in front 499 00:26:01,240 --> 00:26:05,000 Speaker 2: of Vanessa Friedman on this what happens in the machinery? 500 00:26:05,160 --> 00:26:07,840 Speaker 2: I mean John Ferrell's over in Davis did Yeah, He's 501 00:26:07,880 --> 00:26:14,439 Speaker 2: all Mountclair. Lisa's going all Bogner and and Amery Harden's Bellman. 502 00:26:14,760 --> 00:26:18,360 Speaker 2: John's all Mountclear. What does Montclair want from someone from 503 00:26:18,359 --> 00:26:20,440 Speaker 2: Botaga Vanada of Venice? 504 00:26:20,680 --> 00:26:23,639 Speaker 8: I think overall you want to keep the heritage of Montclair, 505 00:26:24,000 --> 00:26:27,639 Speaker 8: but up the ante on what could be unique, differentiated. 506 00:26:27,840 --> 00:26:31,960 Speaker 8: And look what Botega does. It creates iconic pieces. There's 507 00:26:32,000 --> 00:26:33,960 Speaker 8: going to be more icons coming out of Montclair. 508 00:26:34,040 --> 00:26:37,800 Speaker 5: Overtime luxury in general, how is the luxury market these 509 00:26:37,880 --> 00:26:38,760 Speaker 5: days getting better? 510 00:26:38,880 --> 00:26:40,520 Speaker 9: You see China get a little bit better. 511 00:26:40,560 --> 00:26:43,520 Speaker 8: We're going to hear next Wednesday from lvmh Okay, which 512 00:26:43,600 --> 00:26:44,359 Speaker 8: definitely want. 513 00:26:44,200 --> 00:26:46,560 Speaker 9: To hear what they have to say. But it feels better. 514 00:26:46,600 --> 00:26:48,720 Speaker 8: And you know what, it's more important than ever that 515 00:26:48,760 --> 00:26:49,920 Speaker 8: they have their own stores. 516 00:26:50,200 --> 00:26:52,960 Speaker 9: When you need a stronger wholesale channel, what did you. 517 00:26:52,960 --> 00:26:56,240 Speaker 2: Take from Rechemond of Switzerland? Folks? This is Cardier, Lisa. 518 00:26:56,240 --> 00:26:57,679 Speaker 2: Are we wearing Cardier today? 519 00:26:58,160 --> 00:26:58,719 Speaker 9: Not today? 520 00:26:58,880 --> 00:27:02,919 Speaker 2: Okay Cardier? You know, I mean they did well with 521 00:27:02,960 --> 00:27:03,199 Speaker 2: it all. 522 00:27:03,200 --> 00:27:08,520 Speaker 8: I mean increase in jewelry, positive and watches. That's great. 523 00:27:08,560 --> 00:27:11,000 Speaker 8: And you have new icons for the Love bracelet that 524 00:27:11,160 --> 00:27:13,680 Speaker 8: frankly are sold out. Hello reachmonk. 525 00:27:13,840 --> 00:27:17,639 Speaker 2: The distinction is LVMH spends gazillions of dollars like on 526 00:27:17,720 --> 00:27:20,240 Speaker 2: the Girl from Black White and all that. If the 527 00:27:20,359 --> 00:27:22,720 Speaker 2: celebrity endorsements does it really work? 528 00:27:23,359 --> 00:27:26,240 Speaker 8: Everyone wants to be part of a club, and that's 529 00:27:26,280 --> 00:27:28,400 Speaker 8: what a lot of luxury brands allow you to do. 530 00:27:28,960 --> 00:27:30,359 Speaker 5: All right, how about the other side of the K 531 00:27:30,480 --> 00:27:33,159 Speaker 5: shaped economy here, how's the conservuting there? 532 00:27:33,640 --> 00:27:36,040 Speaker 8: Well, look at the trade down that Walmart is getting. 533 00:27:36,320 --> 00:27:38,600 Speaker 8: Walmart seems to be the strength and just like we 534 00:27:38,680 --> 00:27:42,240 Speaker 8: have a ton of changes with creative designers and luxury, 535 00:27:42,680 --> 00:27:46,000 Speaker 8: look at Walmart and target new CEO leaders who come 536 00:27:46,040 --> 00:27:49,159 Speaker 8: from within and are promoted up the food chain. So 537 00:27:49,240 --> 00:27:51,960 Speaker 8: that's going to be interesting to see. But Walmart, with 538 00:27:52,080 --> 00:27:55,199 Speaker 8: AI being one of their very important initiatives they're investing in, 539 00:27:55,640 --> 00:27:58,320 Speaker 8: they seem to be the modernized Walmart, So what. 540 00:27:58,280 --> 00:27:59,520 Speaker 4: Does AI do for retail? 541 00:27:59,600 --> 00:28:05,000 Speaker 8: Just brought defined incremental revenue driver along with expense efficiency enhancer. 542 00:28:05,320 --> 00:28:08,520 Speaker 8: How is it an incremental revenue driver putting things in 543 00:28:08,560 --> 00:28:10,400 Speaker 8: front of you that you didn't even know you needed 544 00:28:10,520 --> 00:28:14,240 Speaker 8: or wanted when you think of the expense efficiency even 545 00:28:14,320 --> 00:28:17,760 Speaker 8: like catalogs, can someone else write the descriptions and someone 546 00:28:17,800 --> 00:28:19,680 Speaker 8: just look at over I think it does a little 547 00:28:19,680 --> 00:28:21,800 Speaker 8: bit of both. And we're still in the early innings. 548 00:28:21,880 --> 00:28:23,680 Speaker 2: Do you have a single best buy? You and Joe 549 00:28:23,720 --> 00:28:26,760 Speaker 2: Felban and the rest of the Telsey Advisory Group is a. 550 00:28:26,640 --> 00:28:28,879 Speaker 9: Bunch of things that we think are in that we 551 00:28:28,920 --> 00:28:29,920 Speaker 9: think are interesting. 552 00:28:29,600 --> 00:28:33,439 Speaker 8: In these days, Walmart being one of them, TJX being another, 553 00:28:33,920 --> 00:28:37,480 Speaker 8: A basket for example, selection of heritage brands that are 554 00:28:37,520 --> 00:28:41,880 Speaker 8: reinventing themselves with Gap, Urban Outfitters and Victoria's Secret. 555 00:28:42,160 --> 00:28:47,240 Speaker 5: Wow, is it still e commerce taking share of Visa VI? 556 00:28:47,720 --> 00:28:49,560 Speaker 5: I know, see Omi channel. You've explained that to us 557 00:28:49,560 --> 00:28:50,800 Speaker 5: over the years, and I get that. 558 00:28:51,160 --> 00:28:53,000 Speaker 4: But where are we in terms of just e commerce? 559 00:28:53,120 --> 00:28:55,880 Speaker 8: E commerce is growing faster than physical retail, but it's 560 00:28:56,000 --> 00:28:59,240 Speaker 8: off a smaller base. Physical retail is at least seventy 561 00:28:59,280 --> 00:29:02,720 Speaker 8: to eighty percent of total sales. Really, the investment in 562 00:29:03,080 --> 00:29:06,880 Speaker 8: physical retail is better, and you're seeing more modernized stores 563 00:29:06,920 --> 00:29:10,600 Speaker 8: that have an experience. There's more demand than supply for 564 00:29:10,680 --> 00:29:15,680 Speaker 8: physical retail space, and you're seeing reinvestment in relocations and 565 00:29:15,760 --> 00:29:18,600 Speaker 8: new flagships. Look at Aritzia, one of the most exciting 566 00:29:18,640 --> 00:29:19,480 Speaker 8: stores out there. 567 00:29:20,240 --> 00:29:22,080 Speaker 2: I see either Danta tells you the President of the 568 00:29:22,160 --> 00:29:25,880 Speaker 2: United States, it's a tough choice. You live, you more 569 00:29:25,920 --> 00:29:29,960 Speaker 2: than anyone I know own fifty seventh Street in Fifth Avenue. 570 00:29:30,080 --> 00:29:34,200 Speaker 2: I mean just absolutely the heart and soul of your life. 571 00:29:34,280 --> 00:29:35,880 Speaker 2: It's popping now, isn't it. 572 00:29:35,880 --> 00:29:37,200 Speaker 9: It is popping. It's busy. 573 00:29:37,320 --> 00:29:40,400 Speaker 8: Those Elvy trunks don't hurt given it seems to be 574 00:29:40,400 --> 00:29:42,960 Speaker 8: one of the most Instagram photos that people are taking 575 00:29:42,960 --> 00:29:43,440 Speaker 8: in New York. 576 00:29:43,480 --> 00:29:46,160 Speaker 4: So that's just not a Christmas thing. That's a that's. 577 00:29:46,000 --> 00:29:50,200 Speaker 8: Because they're doing redoing the bills of Underneath, But it is. 578 00:29:50,720 --> 00:29:54,000 Speaker 2: Do is Tiffany's workout, speaking of you, look at Jese 579 00:29:54,040 --> 00:29:57,720 Speaker 2: I sewing this. I got Audrey heppenover on Fox Marine 580 00:29:57,840 --> 00:30:00,440 Speaker 2: is killing it. Where the Oliver Goldsmiths. We got to 581 00:30:00,440 --> 00:30:03,240 Speaker 2: bring it right back to breakfast to Tiffany's. Did Tiffany 582 00:30:03,320 --> 00:30:04,880 Speaker 2: work out for the RNA family. 583 00:30:05,040 --> 00:30:05,440 Speaker 9: It did. 584 00:30:05,520 --> 00:30:08,080 Speaker 8: It did work out for the RNO family. It got 585 00:30:08,120 --> 00:30:10,720 Speaker 8: them a bigger place, and watches and jewelry got them 586 00:30:10,720 --> 00:30:13,520 Speaker 8: great locations continues to bring them more glome. 587 00:30:13,640 --> 00:30:16,360 Speaker 2: Watches is coming out, I mean, Watches is tanked and 588 00:30:16,440 --> 00:30:17,480 Speaker 2: the answers is coming out. 589 00:30:17,560 --> 00:30:20,200 Speaker 9: Don't don't unintended on the word tank and watches. 590 00:30:21,320 --> 00:30:24,600 Speaker 2: Lose Dana and go to Donald Trump. Dana Tellsey, thank you, 591 00:30:24,720 --> 00:30:28,320 Speaker 2: thank you so much, really really appreciate it great. I 592 00:30:28,360 --> 00:30:31,400 Speaker 2: can't say enough about her work with Joe Feldman. As 593 00:30:31,400 --> 00:30:35,640 Speaker 2: Paul mentioned, from everything that we see in big Box 594 00:30:35,800 --> 00:30:39,720 Speaker 2: out to luxury as well. Stay with us more from 595 00:30:39,720 --> 00:30:42,400 Speaker 2: Bloomberg Surveillance coming up after this. 596 00:30:49,640 --> 00:30:53,240 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live 597 00:30:53,320 --> 00:30:56,320 Speaker 1: weekday afternoons from seven to ten am. E's durn Listen 598 00:30:56,360 --> 00:30:59,920 Speaker 1: on Applecarplay and Android Otto with the Bloomberg Business app, 599 00:31:00,160 --> 00:31:01,880 Speaker 1: or watch us live on YouTube. 600 00:31:02,240 --> 00:31:06,720 Speaker 2: More important our newspapers at least, let's say, all right. 601 00:31:06,680 --> 00:31:09,200 Speaker 6: Let's get to the college admission process. Okay, so all 602 00:31:09,280 --> 00:31:11,880 Speaker 6: my daughter's applications are out. We're in the waiting mode. 603 00:31:11,960 --> 00:31:13,040 Speaker 4: Okay, but it's. 604 00:31:13,000 --> 00:31:15,560 Speaker 6: The waiting mode that is the killer for it all. 605 00:31:15,880 --> 00:31:19,360 Speaker 6: And apparently thousands of students are getting their college decisions 606 00:31:19,680 --> 00:31:24,080 Speaker 6: faster this year because colleges are using AI to figure 607 00:31:24,120 --> 00:31:26,800 Speaker 6: out who to admit and who to reject. Okay, so 608 00:31:26,840 --> 00:31:30,960 Speaker 6: they're using the technology to read essays, review transcripts, things 609 00:31:31,040 --> 00:31:34,640 Speaker 6: like that. So it could reduce you know, the waytime. Yes, 610 00:31:34,680 --> 00:31:38,120 Speaker 6: it could help cut costs, but the whole criticism behind 611 00:31:38,120 --> 00:31:40,800 Speaker 6: it is that they're worried about bias, like concerns that 612 00:31:41,080 --> 00:31:44,120 Speaker 6: it could favor a certain type of student leave disadvantage 613 00:31:44,160 --> 00:31:47,320 Speaker 6: groups behind. So the question do you want AI reading 614 00:31:47,400 --> 00:31:49,239 Speaker 6: your college? 615 00:31:49,280 --> 00:31:50,640 Speaker 2: What I see? And I don't have it in front 616 00:31:50,640 --> 00:31:53,520 Speaker 2: of me, folks, I'm mouthing off here. The SATs are 617 00:31:53,560 --> 00:31:56,920 Speaker 2: coming back, the ects and one way for a touchy 618 00:31:56,960 --> 00:31:59,320 Speaker 2: feeling and grant, I'm going to give everybody a massive 619 00:31:59,360 --> 00:32:02,680 Speaker 2: pass on the endemic that we just survived and all that. 620 00:32:03,080 --> 00:32:05,240 Speaker 2: But I'm just going to suggest, Lisa, you know what, 621 00:32:05,760 --> 00:32:08,360 Speaker 2: it didn't work out. They're bringing testing back to see 622 00:32:08,400 --> 00:32:12,640 Speaker 2: if you know, the student actually got algebra, you know, 623 00:32:13,080 --> 00:32:13,520 Speaker 2: or whatever. 624 00:32:13,680 --> 00:32:16,880 Speaker 6: So we're waiting to hear we are still great mode, right, 625 00:32:16,880 --> 00:32:19,720 Speaker 6: I know some of them were lagging behind it's frustrating, 626 00:32:19,760 --> 00:32:21,800 Speaker 6: but I don't know about the AI going through the 627 00:32:22,400 --> 00:32:23,200 Speaker 6: essays and stuff. 628 00:32:23,280 --> 00:32:23,720 Speaker 4: We'll see. 629 00:32:24,640 --> 00:32:27,960 Speaker 6: Okay, So athletic work wear, right, we've been talking about 630 00:32:27,960 --> 00:32:29,200 Speaker 6: the trend what people. 631 00:32:28,920 --> 00:32:29,680 Speaker 9: Wear to work. 632 00:32:29,760 --> 00:32:32,760 Speaker 6: It used to the athletic wear, the sweatpants and the 633 00:32:32,800 --> 00:32:33,680 Speaker 6: sneakers and. 634 00:32:33,840 --> 00:32:37,120 Speaker 5: You know me sandals to work. Now that's your rule, 635 00:32:37,760 --> 00:32:38,880 Speaker 5: all that out many times. 636 00:32:39,360 --> 00:32:42,920 Speaker 2: Well I could, I could just see you up with 637 00:32:42,960 --> 00:32:44,680 Speaker 2: the Food College. It's important. 638 00:32:44,680 --> 00:32:48,640 Speaker 4: I got a PhD. Am. I I said, I don't care. 639 00:32:48,800 --> 00:32:49,520 Speaker 4: Put some shoes on. 640 00:32:49,640 --> 00:32:52,040 Speaker 9: Tints them out the ones wearing pajamas. 641 00:32:52,160 --> 00:32:52,440 Speaker 4: Okay. 642 00:32:52,480 --> 00:32:55,520 Speaker 6: So the whole point behind this is that there is 643 00:32:55,560 --> 00:32:58,160 Speaker 6: this shift. Okay, so now there is a shift toward 644 00:32:58,200 --> 00:33:01,760 Speaker 6: people I'm wearing more sophistic dedicated clothing and work and 645 00:33:01,800 --> 00:33:04,320 Speaker 6: footwear to the office again instead of those you know, 646 00:33:04,400 --> 00:33:07,520 Speaker 6: sneaker shoes, they're wearing real shoes and you know, all 647 00:33:07,560 --> 00:33:08,320 Speaker 6: that kind of stuff. 648 00:33:08,960 --> 00:33:10,400 Speaker 9: So they're saying companies. 649 00:33:09,960 --> 00:33:12,719 Speaker 6: Like Nike, Adidas, they're all like winters, so they have 650 00:33:12,760 --> 00:33:15,280 Speaker 6: to adapt to this change now that people are getting 651 00:33:15,280 --> 00:33:17,280 Speaker 6: back to the nicser clothes in the office. 652 00:33:17,280 --> 00:33:20,120 Speaker 2: Lisa, thank you so much. The newspaper Sday Lisa Matteo. 653 00:33:20,360 --> 00:33:25,160 Speaker 1: This is the Bloomberg Surveillance Podcast, available on Apple, Spotify, 654 00:33:25,280 --> 00:33:29,560 Speaker 1: and anywhere else you get your podcasts. Listen live each weekday, 655 00:33:29,720 --> 00:33:32,960 Speaker 1: seven to ten am Easter and on bloomberg dot Com, 656 00:33:33,080 --> 00:33:36,880 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 657 00:33:37,200 --> 00:33:40,320 Speaker 1: You can also watch us live every weekday on YouTube 658 00:33:40,600 --> 00:33:42,600 Speaker 1: and always on the Bloomberg terminal