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Speaker 2: The world's changed, and it's gone in a Neil dotted direction.
Speaker 3: Neil Dutta joins from Renmec. Now that extended conversation. Neil,
Speaker 3: you've been talking about the slowdown? Did it begin at
Speaker 3: eight fifteen yesterday?
Speaker 4: Come on, Tom, I mean you have not been long
Speaker 4: enough to know that I wouldn't pin all my hopes
Speaker 4: on the ADPM Ployment report.
Speaker 2: Okay, but there was Moldy. What kind of claims number.
Speaker 3: Do I need to see to confirm your disrespected ADP report?
Speaker 4: Well, I think that break even level on claims is
Speaker 4: probably somewhere around two hundred and fifty to two hundred
Speaker 4: and sixty thousand, So we're getting awfully close. When I
Speaker 4: say break even, I basically mean the cutoff point between
Speaker 4: jobs growth and jobs flat. So we're getting awfully close
Speaker 4: to some pretty soggy employment reports. And remember, you know
Speaker 4: you can use the jolts data to kind of calculate
Speaker 4: what the break even level on jobless claims is. And
Speaker 4: you know, when I run the numbers, it gets me
Speaker 4: to around, you know, around two hundred and sixty thousand,
Speaker 4: So you know, initial jobless claims are running about two
Speaker 4: hundred and forty right now, and I would just say that,
Speaker 4: you know, look, I mean anecdotally, it's really hard to
Speaker 4: think that the labor markets are fine. Just look at
Speaker 4: the last week Microsoft, Disney, and Procter and Gamble announcing
Speaker 4: meaningful layoffs. I mean, if every company is restructuring at
Speaker 4: this same time, that becomes the macroeconomic issue. So I
Speaker 4: do think that not only are layoffs going up, but
Speaker 4: what's more important is that the job finding rate is
Speaker 4: really really weak, and so that means that the well
Speaker 4: of unemployment will continue to build, you know, at least
Speaker 4: over the foreseeable future.
Speaker 5: Amia, We've now all had about twenty four hours to
Speaker 5: digest at ISM data yesterday. I kind of feel like
Speaker 5: yesterday may prove to be an important day. We had
Speaker 5: the services INDEXICO into a contraction area. We had prices
Speaker 5: paid surge, we had new orders really really declined well
Speaker 5: below fifty. How do you put all that together yesterday.
Speaker 4: Well, I mean it's true that the ISM does get
Speaker 4: a lot of weight in the marketplace, but it's also
Speaker 4: important to remember that, you know, the there are multiple
Speaker 4: ways to kind of skin the cat if you were
Speaker 4: in business economics. Right, So we got a pretty soggy
Speaker 4: ISM services number, but we've got a very strong SMP
Speaker 4: Global Services PMI, right, And it's important to kind of
Speaker 4: look under the hood and see what's driving these indicators.
Speaker 6: Right.
Speaker 4: So you know, the ISM services, believe it or not,
Speaker 4: has a goods producing tint to it, right, So it
Speaker 4: includes things like mining, utilities, construction, agriculture that's in the
Speaker 4: ISM services number, right, those are companies that are surveyed
Speaker 4: by ISM. The SMP Global is more of a pure
Speaker 4: services indicator, I would argue, and it has a larger
Speaker 4: sample size. So it's not immediately clear to me that
Speaker 4: services are falling off of a cliff in the way
Speaker 4: that the ISM is is implying. And you kind of
Speaker 4: just have to take all of these things sort of
Speaker 4: on board and put it into your process and just
Speaker 4: adjust accordingly. You know, the ISM tends to be more volatile.
Speaker 4: I mean, it's dip below fifty. Previously you know back
Speaker 4: in late late twenty twenty two. So you know, I
Speaker 4: just tomorrow is going to be more definitive, right, I mean,
Speaker 4: whatever happened with the job's number that offsets everything else
Speaker 4: for the week, And sure you know that's sort of
Speaker 4: I'm thinking about it. I mean, it's it's interesting to
Speaker 4: see some of these data points kind of stacking up
Speaker 4: in a more negative direction. And I will tell your
Speaker 4: audience that surprises tend to line up in the same direction. Right,
Speaker 4: So if you get a week ADP a week ism,
Speaker 4: you know that that tends to build up, you know,
Speaker 4: sort of towards the job's number. But ultimately the job's
Speaker 4: number will settle the score.
Speaker 3: We continue with Neil Dota of Renmack, my Economists of
Speaker 3: the Year a few years ago. Brilliant optimism amid the
Speaker 3: COVID gloom.
Speaker 2: A little more.
Speaker 3: Cautious maybe here over the last at twelve months. We
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Speaker 3: It's the way Neil Dutta partakes in what we do
Speaker 3: here each and every day, claims in sixteen minutes, Paul.
Speaker 5: Neil, the consumer. How's the consumer doing out there? We
Speaker 5: understand there's kind of a bifurcated consumer. Just how do
Speaker 5: you kind of think about the US consumer going forward here?
Speaker 4: Well, Paul, as you know, I mean, I think the
Speaker 4: bifurcated consumer is like a constant trope on Wall Street,
Speaker 4: k shaped. I mean, the high ends doing well as
Speaker 4: if that's not always the case. I mean, it's sort
Speaker 4: of I think it's kind of senseless to keep talking
Speaker 4: about it that way. You know, Ultimately, the story about
Speaker 4: the consumer is one of declining real incomes or slowing
Speaker 4: real incomes and limited savings to cushion themselves from potential shocks. Right,
Speaker 4: So that's the main story. Last year you had about
Speaker 4: you know, maybe three percent growth, a little over three
Speaker 4: percent growth and real conser or spending, which is a
Speaker 4: very strong number. But that was despite real incomes then
Speaker 4: of transfers growing at about one and a half percent.
Speaker 4: So in other words, consumption grew twice as fast a
Speaker 4: real incomes excluding transfers. That means that people drew down
Speaker 4: their savings to jolt their consumption over the last twelve months.
Speaker 4: So even if you assume the savings rate is stable,
Speaker 4: given the ongoing weakness in the labor market, you should
Speaker 4: expect to see consumption slowing at a minimum towards the
Speaker 4: growth and incomes assuming a stable savings rate. So that's
Speaker 4: what we expect, and that means that consumer spending is
Speaker 4: probably growing, you know, maybe one and a half percent,
Speaker 4: probably worse. And you know that on a trend basis,
Speaker 4: and that is you know, consistent with below potential growth.
Speaker 3: So get to get away from the Atlanta GDP number,
Speaker 3: which is a present snampshot. You're migrate neal data from
Speaker 3: a three and a half four percent.
Speaker 2: OMG Atlanta GDP number down to something a lot more tepid.
Speaker 2: Is that right? Yeah?
Speaker 4: I mean I think the Atlanta Fed numbers overstating the
Speaker 4: health of the economy. I mean there's a lot of
Speaker 4: kind of you know, how much building is coming from
Speaker 4: the first quarter? I mean, how is this? I mean, remember,
Speaker 4: the Atlanta Fed is not a pure GDP bean count, right,
Speaker 4: because it includes survey data like ism services, not manufacturing
Speaker 4: for example. You know, That's why I say, I mean,
Speaker 4: if you focus on the labor markets, it gives you
Speaker 4: the sort of cleanest picture in terms of what underlying
Speaker 4: GDP is doing, if you just look at total hours worked.
Speaker 4: So I think when you look at it that way,
Speaker 4: I mean, you're really talking about an economy that's that's
Speaker 4: growing below potential, and that'll mean upward pressure on the
Speaker 4: unemployment rate over time.
Speaker 2: One final question, it's just as simple as this, did the.
Speaker 3: FEDS mandate shift yesterday at eight fifteen or at eight
Speaker 3: thirty this morning? Or with a vengeance, will it shift
Speaker 3: at eight thirty one tomorrow?
Speaker 4: Well, I definitely think that there is a you know,
Speaker 4: the FED has a modest dubbish bias. I mean if
Speaker 4: you look at their performance over the last number of years,
Speaker 4: and so, you know, my sense is that once the
Speaker 4: labor market begins to crack, they'll sort of stop worrying
Speaker 4: about inflation and start worrying about growth. And so, you know,
Speaker 4: given the way they're set up, he sort of needs
Speaker 4: to see that before they can kind of pivot. But
Speaker 4: that's ultimately what I believe is. So if you continue
Speaker 4: to see weaker sort of employment data, you know, the
Speaker 4: Fed will will sort of stop paying attention to what's
Speaker 4: going on with inflation and kind of, you know, capitulate
Speaker 4: in a way.
Speaker 2: Yeah, thank you, dear Doughter. Greatly appreciated from right back.
Speaker 2: Thank you.
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Speaker 3: To have an informed conversation here we could do that
Speaker 3: with a panache. Vishtaperture joins us in, a chief fixed
Speaker 3: income strategist at Morgan Stanley.
Speaker 2: Totally unfair.
Speaker 3: I'm mean I asked the first, you know, the first
Speaker 3: question that matters is a disinflation lower yield vector. Is
Speaker 3: it in place?
Speaker 2: Still? Do you do we just have the.
Speaker 3: Basic idea of a structural move to a lower rate
Speaker 3: regime or have you shifted on that?
Speaker 7: So we think it's a complicated picture, Tom, and good morning,
Speaker 7: and thanks for having me on.
Speaker 6: I think it's a complicated picture.
Speaker 7: We have a view that the inflation in the immediate future,
Speaker 7: so the third quarter of this year, we will actually
Speaker 7: see inflation spiking as a consequence of once the effect
Speaker 7: of tariff's really begs to show up, we expect the
Speaker 7: code PC infation to get to you know, four and
Speaker 7: a half five percent by third quarter, and that prevents
Speaker 7: the ability of the FED to be able to cut
Speaker 7: this year. So unlike what the market is pricing today,
Speaker 7: market is pricing in litt lower two cuts in this year.
Speaker 7: We are expecting no cuts this year, and market is
Speaker 7: pricing roughly between two and three cuts next year. Would
Speaker 7: think there will be a lot more cuts next year.
Speaker 7: We're expecting seven rate cuts next year. So the picture
Speaker 7: is a bit more complicated. I think that the right
Speaker 7: so cutting all the way down to five. So we
Speaker 7: are our expectation of where the profit rate is lower,
Speaker 7: but the timing is quite a bit different than what
Speaker 7: the market is currently.
Speaker 5: No rate cuts this year, seven next year. These Morkings
Speaker 5: Stanley guys are always turn up trouble. They are anti
Speaker 5: corid census calls vishy. So what do we do in
Speaker 5: the backdrop there? I mean, I'm looking at the two
Speaker 5: year We're now well below four percent. I got my
Speaker 5: ten year we're down to four thirty two. How do
Speaker 5: you play the trade free market at this point?
Speaker 7: So what we are suggesting really is a steepeners are
Speaker 7: still our trade.
Speaker 6: We do expect steepening to occur.
Speaker 8: We think that the maybe the at the moment, tactically
Speaker 8: we would be neutral on duration.
Speaker 7: But we think we will around the As we go
Speaker 7: towards the end of the year, the market will begin
Speaker 7: to price in that the Fed will cut a lot
Speaker 7: more because the conditions for the Fed to cut, in
Speaker 7: our minds are inflation should not be going higher. Inflation
Speaker 7: should be should begin to show signs of slowing, which
Speaker 7: we expect to happen early part of next year. We
Speaker 7: also think that the race at the pace of huge
Speaker 7: opportion will slow substantially.
Speaker 3: Visitaria fortuur us, we will continue. We are two minutes
Speaker 3: away from suddenly an interesting claims number. The two sets,
Speaker 3: the actual claims number with the revisions and those continuing
Speaker 3: claims which made news last week.
Speaker 5: Paul visciually given kind of your interest rate outlook and
Speaker 5: some of the economic concertainty that that's out there, certainly
Speaker 5: as it relates to growth into inflation, we had some
Speaker 5: startling data yesterday. Credit risk talk to us how you
Speaker 5: talk to your clients about credit risk?
Speaker 6: Sure?
Speaker 7: Yeah, I would say reasonably constructive on credit in a way,
Speaker 7: you know, with the way I would look at it
Speaker 7: is that we are calling for a meaningful slowdown in growth,
Speaker 7: but we are not calling for a our base case
Speaker 7: that's not called for a recession in the United States.
Speaker 7: So we go from two and a half percent growth
Speaker 7: in twenty twenty four to one percent growth in twenty five.
Speaker 7: With twenty six and if you look at the credit fundamentals,
Speaker 7: the credit fundamentals enter this cycle at this point in
Speaker 7: a pretty healthy stage. So if you look at leverage metrics,
Speaker 7: you look at interest coverage metrics, look, they don't look elevated,
Speaker 7: they don't show hows of excessive credit risk taking.
Speaker 6: Also, the you know we are you know we are.
Speaker 7: If you look at the rate of upgrades downgrades, it's
Speaker 7: stured much more in favor of upgrades.
Speaker 6: So you put all these things together, you.
Speaker 7: Add some more fun you know, technical factors such as
Speaker 7: the emergence of the yield total yield based buyer, you
Speaker 7: have a reasonably constructive outlook for high quality credit.
Speaker 3: Officially, I look at the ten year inflation to justin yield.
Speaker 3: I know there's a number of ways to look at it,
Speaker 3: but the answer is that real yield is coming in.
Speaker 2: Is that constructive for the FED?
Speaker 3: Or is that the horse before the cart getting out
Speaker 3: in front of rake cuts?
Speaker 7: So I think it is this quite doesn't reflect the
Speaker 7: effect of higher tariffs showing up in the inflation numbers yet.
Speaker 7: So when we when we start seeing the numbers, which
Speaker 7: we expect starting, you know, as soon as in this quarter,
Speaker 7: the next month numbers should begin to reflect the effect
Speaker 7: of the tariffs, So tarifs will be a pass through.
Speaker 7: So we, as I said earlier, we expect to get
Speaker 7: the core PC numbers, the inflation levels that the FED
Speaker 7: cares about to get to four and a half five
Speaker 7: percent on an annualized basis, the temal number, you know,
Speaker 7: the month number numbers annualized basis to four and a
Speaker 7: half five percent, which will we expect to happen sometimes
Speaker 7: towards the end of third quarter, you know.
Speaker 8: And that's uh. I think some of these uh.
Speaker 7: You know that really prevent the you know, the sort
Speaker 7: of binds the right answer the fat for cutting this year, VIC.
Speaker 5: We we've got our friends down in Washington, DC trying
Speaker 5: to pass some tax legislation and I don't know whatever
Speaker 5: version you're looking at, it looks like they're penciling in
Speaker 5: a big increase into you know, the deficits and debt.
Speaker 5: Does your bond market does it care anymore?
Speaker 7: I think it maybe maybe maybe the bond market doesn't
Speaker 7: care about the projections for the ten year time for
Speaker 7: because I think the bond market does care what the
Speaker 7: near term is going to be. So we would have
Speaker 7: said that the one year twenty what happens in twenty
Speaker 7: twenty six, what would be the issuance requirements, what will
Speaker 7: be the composition of that that issuance bond market does
Speaker 7: care about that.
Speaker 6: But I think where we are thinking.
Speaker 7: Is that the the Frescolympetus coming out of this for
Speaker 7: the next next year, amount of deficit edition is not
Speaker 7: It's going to be a roughly three hundred billion, is
Speaker 7: what we are That's the number we are canceling in.
Speaker 7: I think that's that is something the market.
Speaker 3: Vishi, thank you so much, really appreciate it. With Morgan
Speaker 3: Stanley and as Paul mentioned, the idea of seven cuts
Speaker 3: in twenty twenty six, stop the show. There vis tier
Speaker 3: porture again fixed income with Morgan Stanley.
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Speaker 3: Julia carnetto right Now, Micro policy perspectives.
Speaker 2: Julia, I thought we were going to walk through the interview.
Speaker 3: Not incredible amount of information off the dual mandate.
Speaker 2: If labor breaks.
Speaker 3: Weaker, but we get some form of tariff inflation. As
Speaker 3: a general statement, every study I've ever seen is they're
Speaker 3: going to side on the inflation decision. Are they really
Speaker 3: going to decide on the labor economy? I don't buy it.
Speaker 9: Well, it really depends, as Chair Powell has said, on
Speaker 9: the magnitude of the miss relative to their mandate. So
Speaker 9: right now we're starting from a point where we're at
Speaker 9: their full employment mandate by almost every metric, and we're
Speaker 9: still missing and as Powell said, we've been missing for
Speaker 9: four years their inflation mandate. So yes, in the near
Speaker 9: term they are going to lean on the inflation mandate,
Speaker 9: hold their fire on rate cuts, and wait and see
Speaker 9: as we navigate through this tariff shock, which you know
Speaker 9: very very likely will boost inflation at least in the
Speaker 9: near term. Even if it does turn out to be
Speaker 9: a one time change in prices, They're going to want
Speaker 9: to verify that trust. But verify means so that means
Speaker 9: that the labor market has to really get a lot
Speaker 9: weaker and look quite recessionary, okay, before they cut rates.
Speaker 3: Tomorrow's jobs report at eight thirty, is that going to
Speaker 3: deliver quote a lot weaker No.
Speaker 9: I don't expect so. I mean we have a one
Speaker 9: hundred and fifteen k on non farm payrolls. That's a slowdown,
Speaker 9: but sort of a gradual one. And tom the complicating
Speaker 9: factor in interpreting payrolls in the next six months is
Speaker 9: going to be that we are implementing very drastically reared
Speaker 9: strictive immigration policy, and that in economic NERD terms, lowers
Speaker 9: the potential growth rate of the labor market and GDP.
Speaker 9: We should expect to see less hiring because there is
Speaker 9: less labor supply. That is not a that's a sort
Speaker 9: of structural feature that it's not up to the Fed
Speaker 9: to offset with stimulus. So if we choose as a
Speaker 9: nation to have fewer immigrants, then we will have less GDP.
Speaker 9: Growth and less non farm payrolls. That so we're going
Speaker 9: to have to really look at the unemployment rate as
Speaker 9: the arbiter of Okay, we're seeing a slowdown in hiring,
Speaker 9: but are we seeing the unemployment rate rise? And I
Speaker 9: don't expect. I have the unemployment rate holding it for
Speaker 9: two which is still, you know, quite low by historical standards.
Speaker 5: Joeya looking back on yesterday's ISM data, I guess the
Speaker 5: headline was the services in next dipped below fifty, suggesting
Speaker 5: that maybe the service's economy against seventy percent of the
Speaker 5: US economy, might be contracting. But you also had some
Speaker 5: data showing I don't know, new orders plunging, prices paid
Speaker 5: kind of surging here. And then you look at today's
Speaker 5: initial job as claims that it came in higher than expected.
Speaker 5: Are we starting to finally see in the hard data
Speaker 5: some of the uncertainty that's been unleashed by some of
Speaker 5: this tariff discussion.
Speaker 9: Yes, I think the answer is a decisive yes to that.
Speaker 9: All of the April data came in soft. We saw
Speaker 9: decline in core retail sales, we saw decline in core
Speaker 9: capital goods orders, we saw decline in auto sales.
Speaker 10: In April and May.
Speaker 9: In the trade data that we got this morning, the
Speaker 9: detailed report, we are seeing confirmation that a lot of
Speaker 9: the demand we saw in Q one was pull forward
Speaker 9: ahead of tariffs, which means that we're in for a
Speaker 9: pothole in final demand in Q two. So yeah, I
Speaker 9: think we are seeing confirmation that number one, people did
Speaker 9: a lot of buying and spending ahead of tariffs. So
Speaker 9: for example, one thing we got in the trade report
Speaker 9: today was a drop in technology imports. That was something
Speaker 9: that had really boosted investment in Q one. That will
Speaker 9: be a decline in Q two. So there's a little
Speaker 9: bit too much. I think hopium built in that data
Speaker 9: centers can save the economy, and I don't.
Speaker 6: Think they can.
Speaker 3: Just so you understand, they don't have Hopium in college station.
Speaker 2: Now they have hope in Austin.
Speaker 5: Just so, Julia, this once again, I guess I'll ask
Speaker 5: it this way. Does this once again raise aspector that
Speaker 5: this FED will be too late?
Speaker 9: I mean, I think that the FED is constrained so
Speaker 9: too late. Uh, you know, when we are making policy
Speaker 9: choices to kind of make the monetary and fiscal trade
Speaker 9: offs worse, right, so we are choosing to expand the deficit.
Speaker 9: We are choosing to restrict immigration, we are choosing to
Speaker 9: instigate a trade war. All of this makes monitor Harry
Speaker 9: trade offs worse. That's not the Fed's fault. They didn't
Speaker 9: make these choices. So are they going to be late? Well,
Speaker 9: they have to make sure. They don't know right now.
Speaker 9: Will the labor market stay resilient. We should certainly have
Speaker 9: seen that in the last few years. Will we actually
Speaker 9: see the burst of inflation? They're going to just have
Speaker 9: to calibrate on the data. There's so many possible scenarios
Speaker 9: from here.
Speaker 2: Julia quick and you're just perfect for this.
Speaker 3: We see Canada terrible exports to America, and then there's
Speaker 3: a sentence by CIBC that they made it up with
Speaker 3: buoyant exports to UK and China. Do you buy the
Speaker 3: idea all of these troubled nations can find other venues
Speaker 3: for their exports if we shut the door.
Speaker 9: I mean they're going to have to find other venues.
Speaker 9: I don't think that that's going to be a perfect
Speaker 9: offset because the US has been the driver of the
Speaker 9: global economy for the last few years. So I think
Speaker 9: that this trade war is going to dent global growth.
Speaker 9: But I think most of our trading partners, including Canada
Speaker 9: and the UK and others, do see this as a
Speaker 9: structural break, like the US is not going to return
Speaker 9: to its ally status that it was, you know since
Speaker 9: World War Two. We are choosing to turn away from
Speaker 9: allies and choosing to be an unreliable trading partner, right
Speaker 9: and they will have to. I mean, you'd be foolish
Speaker 9: not to look to diversify your exports.
Speaker 3: Julia Carnatt, thank you so much, greatly appreciate it.
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Speaker 2: It's just a great conversation.
Speaker 3: Paul Sweeden's going to dive in here and lead it.
Speaker 2: It's real simple.
Speaker 3: In eighteen forty there was a huge famine in Ireland.
Speaker 3: Many went to Canada rather, and many from Canada went
Speaker 3: to a nascent steel industry in Pittsburgh, including the Rooney family.
Speaker 2: Yep.
Speaker 3: And they will, I mean celebrate this, you know, the
Speaker 3: Rooney family just iconic Paul, the Steelers will play in Ireland.
Speaker 2: I know that's really.
Speaker 5: Very, really cool exactly, and that's important for both sides.
Speaker 5: Neil Richmond joins us. He's a Minister of State for
Speaker 5: Diaspora and International Development for Ireland. Neil, thanks so much
Speaker 5: for joining us here. A lot going on out there
Speaker 5: on the geopolitical front. I'd just love to get your perspective,
Speaker 5: the perspective of the Irish government of how it's dealing
Speaker 5: with a lot of trade uncertainty just globally here. What's
Speaker 5: the perspective of Ireland these days?
Speaker 11: I suppose I'd like to say two things in that regard.
Speaker 11: First and foremost, we are going to every length possible
Speaker 11: to stress how rich the trade investment relationship is, not
Speaker 11: just between the in the US, but particularly between Ireland
Speaker 11: and the US. Ireland is the sixth largest investor in
Speaker 11: the United States. There's more Americans employed by Irish companies
Speaker 11: in the US than there is Irish people employed by
Speaker 11: American companies in Ireland. But it's a really strong relationship.
Speaker 11: The US is our largest trading partner. It's a really
Speaker 11: strong basis in terms of life sciences sector, in terms
Speaker 11: of agrifood and signs of tech. But in terms of
Speaker 11: how we respond to this period of instability, to be
Speaker 11: quite frank, and we welcome any puzz in relation to
Speaker 11: tariffs is we're working with our European partners to make
Speaker 11: sure that the European response to any pronouncements or decisions
Speaker 11: is measured, is reasonable, that protects business and more importantly,
Speaker 11: that strengthens, if anything, the trading relentship relationship between the
Speaker 11: EU and the US. Let me be very very frank.
Speaker 11: Tariffs are a bad thing. They're not good for our economies,
Speaker 11: they're not good for our companies, but crucially they're not
Speaker 11: good for the consumers, either in the United States or
Speaker 11: in Europe. People shouldn't be having to pay more for
Speaker 11: their drugs, or for medicines or anything else in this regard.
Speaker 11: So that's the approach of the Irish government. We want
Speaker 11: to work on a bilateral basis, on a European basis,
Speaker 11: but crucially we're also working not just at a federal level,
Speaker 11: but at a state level, which is why I've spent
Speaker 11: the last couple of days in Pennsy Pennsylvania and Massachusetts.
Speaker 5: So you mentioned Neil, the pharmaceutical company's strong presence in Ireland.
Speaker 5: What are you hearing from the pharmaceutical companies with bases
Speaker 5: in Ireland at the moment.
Speaker 11: Yeah, we're very lucky that fourteen of the fifteen largest
Speaker 11: pharmaceutical companies in the world have either their European or
Speaker 11: Amia head offices in Ireland, and we're working really strongly
Speaker 11: with them to make sure that they are able to
Speaker 11: weather any uncertainty that their commitment to the European and
Speaker 11: American market is strong. But I'll be quite frank they
Speaker 11: are worried. They're worried that the decisions being taken elsewhere
Speaker 11: might limit their ability to grow their markets.
Speaker 6: And more importantly, what.
Speaker 11: We're very very worried from an Irish government point of
Speaker 11: view is we have a huge pipeline of expansion and
Speaker 11: modernization of some of the plants that are in Ireland.
Speaker 11: New drugs coming on stream, new device is coming on stream.
Speaker 11: But the hesitancy in the American situation means that those
Speaker 11: basis aren't possible to go forward in the in the
Speaker 11: New York term, And you.
Speaker 5: Know you mentioned this strong relationship between the US and
Speaker 5: Ireland from the trade perspective. In fact, Ireland surplus with
Speaker 5: the US is one of the largest. And I know
Speaker 5: Secretary Howard Luckman has singled out Ireland in the past.
Speaker 5: How will Ireland respond to the extent that Trump really
Speaker 5: wants to put some pressure on Ireland specifically.
Speaker 11: Well, well, I think one thing is when you take
Speaker 11: trade in goods and services, it's quite a balanced relationship.
Speaker 11: We know there's a huge surplace when it comes to
Speaker 11: goods and goods alone, but services together, it's really a
Speaker 11: balanced relationship. And our Deputy Prime Minister, our Minister Foreig
Speaker 11: Affairs and Trade, has met Secretary Lutnick a couple of
Speaker 11: times and we've spoken with them and we've really laid
Speaker 11: out that Ireland should not be seen as a rival
Speaker 11: to the United States. It's a complementary relationship. The vast
Speaker 11: majority in the area of pharmacy, life science, it's the
Speaker 11: vast majority of goods that are producing art and actually
Speaker 11: your component goods that are finalized in the US and
Speaker 11: then sold into the US market.
Speaker 3: Neil Paul from New York City emails in and he says,
Speaker 3: can you free up with your massive power with an
Speaker 3: Irish government? The Mariana Hotel from September twenty fourth to
Speaker 3: September twenty seventh at one thousand, five hundred and sixty
Speaker 3: six dollars per.
Speaker 2: Night, Neil, can you free up a couple of rooms
Speaker 2: there for us? For the Steelers Vikings.
Speaker 11: I can't even get a cup of coffee in the
Speaker 11: Maria Hotel. It's such a popular, wonderful venue. But what
Speaker 11: I will say to Paul from New York, I don't
Speaker 11: have a spare bedroom in my house. I've got a
Speaker 11: couple of young kids. But I know lots of wonderful
Speaker 11: accommodation in my district.
Speaker 2: There were just Neil, tell me about real estate and Dublin.
Speaker 2: I look at it. I'm absolutely flabbergasted.
Speaker 3: Paul's looking at you know, three four bedrooms there and
Speaker 3: it's like, you know, Bono prize, boom prices.
Speaker 2: It is tough. When does Dublin just the it can't.
Speaker 11: Go higher, right, Neil, Well, it can, and we've made
Speaker 11: a change there which is really welcome. At the moment,
Speaker 11: the highest building in Dublin is seventeen stories, but we've
Speaker 11: just see what's being constructed.
Speaker 2: At the moment.
Speaker 11: We have our first building that goes.
Speaker 6: Past twenty stories.
Speaker 11: So there was changes at a city level which removed
Speaker 11: the high cap in Dublin city in the last couple
Speaker 11: of years. So we're seeing a lot of introduction, particularly
Speaker 11: right in the city center along the River of high
Speaker 11: rise development, both in terms of office space and a
Speaker 11: d commercial So it is going up. It is becoming
Speaker 11: more dense, and that's really welcome.
Speaker 6: But our biggest.
Speaker 11: Concern from an Irish coping point of view is we
Speaker 11: needed to go higher quicker.
Speaker 2: Noah Richard, thank you so much.
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday
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Speaker 1: say Alexa play Bloomberg eleven thirty.
Speaker 3: One of my major faults, one is I don't do
Speaker 3: enough on municipal bonds, and the other is retire vironment
Speaker 3: is a tragedy in America. We all know that you
Speaker 3: don't need to be lectured by me on a Thursday morning.
Speaker 3: She is Pension B in the United Kingdom and the
Speaker 3: United States. Ramisavova is CEO at Pension B and joins
Speaker 3: us here from London. In the studios. On your website,
Speaker 3: you get fifty seven nine and twelve dollars. That's what
Speaker 3: I got in my four to oh one K. Whatever
Speaker 3: anybody's age is, I'll pick forty two.
Speaker 2: It's not enough.
Speaker 3: What percentage of people have four to one ks where
Speaker 3: you stayed actuarily.
Speaker 10: It's not enough, I would say the vast majority, although
Speaker 10: not enough. Will also depend on where you want to
Speaker 10: retire exactly how much you want to spend, But overall,
Speaker 10: what we see in the numbers is generally speaking, the
Speaker 10: median person does not have.
Speaker 6: Enough and enough.
Speaker 3: The way you do this is to put more aside
Speaker 3: in the government. It's helping out sort of kind of
Speaker 3: like in that what's the bogey the pension B what's
Speaker 3: the number that I want to get to? Don't tell
Speaker 3: me it's seven hundred thousand. That's not going to get
Speaker 3: it done.
Speaker 2: For John Tucker on the shore in New.
Speaker 3: Jersey, well, I'm not leaving the shore, just to be clear,
Speaker 3: it's just east there forever.
Speaker 10: Well, it depends on how much you want to spend
Speaker 10: in retirement, but the median person has around fifty to
Speaker 10: sixty thousand dollars in four to one K savings, and
Speaker 10: that will almost certainly not be enough anywhere A lot
Speaker 10: of the research we've done shows that around forty percent
Speaker 10: of Americans don't even have enough funds to retire for
Speaker 10: one year, and so there's no real simple answer. The
Speaker 10: best thing you can do is figure out how do
Speaker 10: you want to live when you retire, When do you
Speaker 10: want to retire, and then work backwards from there, and
Speaker 10: that will tell you how much you need to start
Speaker 10: putting in.
Speaker 5: You walk into any Starbucks in the United States and
Speaker 5: it's filled with people on laptops. I'm not sure what
Speaker 5: they're doing. I've been told they're part of the gig ecademy.
Speaker 5: What did those people do because they don't have the
Speaker 5: matching four one ks that a lot of companies offer,
Speaker 5: What did they do well?
Speaker 10: I think it's a huge issue. It's a huge problem.
Speaker 10: Studies now indicate that gig economy workers are around fifty
Speaker 10: percent and will soon be more than fifty percent of
Speaker 10: the entire workforce, and they don't get the standard employee
Speaker 10: benefits that you would get in a big company, and
Speaker 10: so retirement provision is really left up to them. One
Speaker 10: thing that a lot of self employed workers do look
Speaker 10: into is something called a step ira step ira, Yeah,
Speaker 10: and that is something it's a vehicle that gives you
Speaker 10: access to the ability to contribute substantially above the normal
Speaker 10: IRA limits.
Speaker 2: Denmark just went to age seventy.
Speaker 3: I believe I got this right, folks, don't If I'm
Speaker 3: wrong on this, you can stay with me.
Speaker 2: It's part of the script.
Speaker 3: Denmark went to seventy Are we not in out retirement?
Speaker 3: What do you think John seventy two, seventy six? What
Speaker 3: do you think we ought to be gone here here? Eighty?
Speaker 11: Oh?
Speaker 6: Should we?
Speaker 2: Should we running this out to eighty years old?
Speaker 10: For some people that is an economic reality.
Speaker 6: Yes.
Speaker 3: What do you say to the politicians in Washington or
Speaker 3: in London about fix this?
Speaker 2: What's the number one thing they need to do?
Speaker 6: Well?
Speaker 10: For the politicians in the US, the number one thing
Speaker 10: is to mandate automatic enrollment across the board, and to
Speaker 10: find a way to mandate it for gig economy workers.
Speaker 2: Too suppy, are you know?
Speaker 10: Yes, because when we look at the numbers, only around
Speaker 10: fifty percent of workers are actually contributing. And the longer
Speaker 10: you leave it, the greater the shorter This is.
Speaker 3: Great, Grand me so well, but thank you so much
Speaker 3: with pension me of course, they are all the good
Speaker 3: work of Peter or zeg Now at Lazard and I
Speaker 3: Think A Roger Ferguson and Tia Kraff.
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