WEBVTT - Surveillance: OECD Cuts 2021 Global Forecast 0:00:09.880 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene Jay Ley. 0:00:13.960 --> 0:00:17.560 We bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.520 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:27.320 Bloomberg dot Com, and of course on the Bloomberg Looking 0:00:27.360 --> 0:00:31.680 Ahead to one. The outlook not getting better? The O 0:00:31.800 --> 0:00:34.440 E c D. What's going on? The outlook from lawn Spoon, 0:00:34.520 --> 0:00:36.760 the chief economists, joins us right now, no one's talked 0:00:36.760 --> 0:00:38.960 to me about one, and why you've had to cut 0:00:39.000 --> 0:00:42.320 that forecast. So, as you know, we're still in the 0:00:42.360 --> 0:00:45.040 midst of the pandemic, and we're having a second wave 0:00:45.120 --> 0:00:49.680 with many countries in the northern Hemisphere and as well 0:00:50.000 --> 0:00:52.520 as you know, having the pursuit of the first wave 0:00:52.600 --> 0:00:56.240 in some of the countries. So twenty twenty one is 0:00:56.240 --> 0:00:58.720 still very much affected by what's happening now in the 0:00:58.800 --> 0:01:03.600 first quarter. Now with the vaccines inside, there is much 0:01:03.720 --> 0:01:07.000 hope and I think the outlook would be brighter. We 0:01:07.120 --> 0:01:11.760 project recovering one. As you know, it will be a 0:01:11.760 --> 0:01:14.560 little more than four percent that one being off to 0:01:14.680 --> 0:01:18.440 have said the decision we have in twenty but it's 0:01:18.560 --> 0:01:21.800 it's a big step towards a brighter future. Um, what 0:01:22.000 --> 0:01:25.679 will be super important is that policies keep the support 0:01:25.800 --> 0:01:28.120 on the health on the fiscal side so that we 0:01:28.160 --> 0:01:32.679 can achieve better recovery once once the vaccine will have 0:01:32.800 --> 0:01:36.200 been deployed. Are you concerned about how much damage we 0:01:36.240 --> 0:01:41.199 do between now and then, Absolutely, we're very concerned, which 0:01:41.240 --> 0:01:45.039 is why we have this overarching message of keeping up 0:01:45.280 --> 0:01:48.480 the support if if we keep on, if we double 0:01:48.600 --> 0:01:52.000 down on health policy packages, because you know, the vaccine 0:01:52.040 --> 0:01:54.680 is not excuing us right now. We need to go 0:01:54.720 --> 0:01:57.520 through the winter and the spring and we need to 0:01:57.560 --> 0:02:02.080 deploy it. And firms have been affected by in some 0:02:02.160 --> 0:02:06.440 sectors going out of business in oders, weaker demand. Some 0:02:06.520 --> 0:02:09.600 people a large young of people have been protected by 0:02:09.720 --> 0:02:12.680 job with tension schemes, but some of them are falling 0:02:12.720 --> 0:02:16.880 through the crack. Firms balance sheet may be affected as well. 0:02:17.040 --> 0:02:21.160 So we are saying with vaccines inside, you know, governments 0:02:21.200 --> 0:02:25.760 we have vindicated in implementing these huge support to firms 0:02:25.760 --> 0:02:29.600 and people and they must continue to do so. There 0:02:29.639 --> 0:02:31.840 will be a time to reflect on the debt, but 0:02:31.919 --> 0:02:36.120 that won't be one. So what kind of fiscal support 0:02:36.160 --> 0:02:39.000 packages are you factoring in here? When you come up 0:02:39.040 --> 0:02:44.360 with your four point growth projection for So what we 0:02:44.720 --> 0:02:48.280 what we're working on is assuming that the support to 0:02:49.200 --> 0:02:53.239 workers through furlow schem or job at tension scheme will 0:02:53.320 --> 0:02:57.120 be maintained, especially in the sectors which are directly affected 0:02:57.120 --> 0:03:02.760 by restrictions to mobility. UM, we're also incorporating the support 0:03:02.800 --> 0:03:05.320 to firms, and you know that a number of countries 0:03:05.919 --> 0:03:09.919 of easy countries have extended these too, about sometimes as 0:03:09.960 --> 0:03:14.480 far as summer twenty twenty one. We also have considered 0:03:14.560 --> 0:03:18.960 recovery plans which have been issued by a number of countries. UM. 0:03:19.000 --> 0:03:22.120 What we are saying is, you know, with monetary policy 0:03:22.400 --> 0:03:27.119 very accommodative and in the FOCE seeable way for the future, 0:03:27.919 --> 0:03:32.560 the dead services of most city countries is actually lower 0:03:32.600 --> 0:03:35.480 than what it was in twenty four So there is 0:03:35.680 --> 0:03:39.680 space for using the fiscals tool in the strategic way 0:03:39.720 --> 0:03:43.560 that I've just described throughout twenty twenty one. And until 0:03:43.880 --> 0:03:48.960 the recovery has been more momentum or unemployment has started decreasing, 0:03:49.000 --> 0:03:53.480 that is super important. Alternatively, and we have two scenarios 0:03:53.480 --> 0:03:57.240 in our projections. UM, if there's not enough public health 0:03:57.400 --> 0:04:02.360 or fiscal support, confidence may folter films failure may be bigger, 0:04:02.680 --> 0:04:05.880 and we could be in a much much lower recovery 0:04:06.000 --> 0:04:10.320 with the matches on the side for jobs and for firms, Lawrence. 0:04:10.560 --> 0:04:13.240 A lot of people have looked at stock markets globally, 0:04:13.280 --> 0:04:16.200 looked at their incredible performance of late and said, look 0:04:16.200 --> 0:04:19.320 at how well the economy is recovering, and yet this 0:04:19.520 --> 0:04:22.960 dissonance between the economy and markets continues, at least when 0:04:22.960 --> 0:04:25.680 we look at the economy in real time. Are you 0:04:25.800 --> 0:04:30.080 concerned that people's emphasis on stock markets on risky asset 0:04:30.120 --> 0:04:34.000 prices is a measure of economic health that that actually 0:04:34.360 --> 0:04:37.599 hampers the recovery because it hampers the effort to get 0:04:37.680 --> 0:04:41.400 fiscal stimulus into the hands of people who actually need it. 0:04:41.960 --> 0:04:45.880 I'm not concerned about stock markets doing well, um. I 0:04:45.920 --> 0:04:49.200 think they're forward looking. That's saying that the job of 0:04:49.240 --> 0:04:52.240 people on the on the stock market, they include the 0:04:52.320 --> 0:04:56.560 better outcome linked with the advances in public health and 0:04:56.600 --> 0:05:01.400 also expectation of very strong monitary and fiscal support. What 0:05:01.520 --> 0:05:05.000 I'm concerned about is in some instances there's a lack 0:05:05.080 --> 0:05:09.400 of connection between the size of the fiscal stimulus and 0:05:09.480 --> 0:05:13.440 the effect on the economy, and that's where fiscal public 0:05:13.480 --> 0:05:17.920 spending are not spent wisely, which is why we're insisting 0:05:18.040 --> 0:05:22.160 on the need to target the appropriate people, the viable firms. 0:05:22.200 --> 0:05:25.560 Some countries do that very well, um as well as 0:05:25.600 --> 0:05:28.840 all those that are left behind, and also on that's 0:05:29.240 --> 0:05:32.599 now even more important, you know, invest in the economy 0:05:32.640 --> 0:05:38.440 of tomorrow, education, digital and energy composition, not size Lawrence. 0:05:38.520 --> 0:05:40.680 Before we let you go, you mentioned some countries are 0:05:40.720 --> 0:05:43.080 doing it well. Who's doing it well? You know, there 0:05:43.080 --> 0:05:46.239 are a number of countries which are doing well, especially 0:05:46.320 --> 0:05:49.960 in Asia because they've addressed the virus more quickly. But 0:05:50.000 --> 0:05:54.080 we're also seeing many countries doing much better than we 0:05:54.160 --> 0:05:57.320 could have expected in this crisis because they've put in 0:05:57.400 --> 0:06:02.240 place the necessary support to firms and to employment, and 0:06:02.279 --> 0:06:05.840 I think they should continue. You know, they are talks 0:06:05.920 --> 0:06:10.200 of softening the support or withdrawing it. We've seen that 0:06:10.400 --> 0:06:12.960 in the financial crisis. We should learn the listens it's 0:06:13.000 --> 0:06:15.480 not the right time to do this. Whether if we 0:06:15.600 --> 0:06:19.160 put in place the good policies, if vaccine sound deployed 0:06:19.240 --> 0:06:22.000 and fiscal support remains, we could be in an upsite 0:06:22.040 --> 0:06:25.440 scenario with even faster recovery. I hope this is what 0:06:25.480 --> 0:06:28.400 we hope, So we all hope. So Lawrencepoon, O we 0:06:28.480 --> 0:06:30.640 c D Chief Economist, law It's always great to catch up. 0:06:30.680 --> 0:06:32.760 Thank you. The O E c D kind of gets 0:06:33.360 --> 0:06:36.520 one global growth forecast the four point two from the 0:06:36.600 --> 0:06:43.719 five percent forecast they had back in September. Let's bringet 0:06:43.720 --> 0:06:46.880 t ask you with skybish Capital co ce Io try 0:06:47.000 --> 0:06:49.440 just help us reflect on the month that was and 0:06:49.440 --> 0:06:52.960 how we reset for the month to come. Yes, so look, 0:06:53.200 --> 0:06:55.840 you came into the sponsor's quite a few rotations, right. 0:06:55.839 --> 0:06:57.800 You came in with markets are pricing in a blue 0:06:57.800 --> 0:07:01.040 waves and then you did you got estimatebly wave obviously 0:07:01.040 --> 0:07:03.760 had a Biden victory but certainly not a sentate flipping 0:07:03.800 --> 0:07:05.840 at least yet and seats lost in the house. So 0:07:05.960 --> 0:07:08.440 that cut some of the you know, cyclical names to 0:07:08.480 --> 0:07:10.440 sell off a bit and tech the rally back. And 0:07:10.440 --> 0:07:13.680 then of course we had the fantastic news which can 0:07:13.800 --> 0:07:16.720 be understated enough about how effective these vaccines are and 0:07:16.760 --> 0:07:18.400 what that means in terms of light at the end 0:07:18.440 --> 0:07:21.320 of the tunnel. So you put that all together going 0:07:21.360 --> 0:07:23.360 in where it had a VIX around forty at the 0:07:23.440 --> 0:07:25.960 end of October and a lot of risk off price action, 0:07:26.400 --> 0:07:29.080 and it had an extremely explosive month really across the 0:07:29.120 --> 0:07:33.080 board for all assets, whether it was credit, cyclicals, value. 0:07:33.520 --> 0:07:36.160 Really the only names that performed poorly were showing the 0:07:36.200 --> 0:07:38.000 stay at home names that have done so well for 0:07:38.040 --> 0:07:40.480 the rest of the for the earlier in the year. 0:07:40.600 --> 0:07:43.600 So you know, as we look forward, you know clearly 0:07:43.720 --> 0:07:46.400 we're starting at twenty three times four earnings again, just 0:07:46.440 --> 0:07:48.960 like we were at the beating in September. Even after 0:07:49.000 --> 0:07:51.360 this massive rally, equities are only up three and a 0:07:51.360 --> 0:07:53.640 half to four the last three months. We all know 0:07:53.760 --> 0:07:55.360 that games are gonna be much harder to come by, 0:07:55.400 --> 0:07:58.720 and equity markets are all assets in general, um, but 0:07:58.800 --> 0:08:01.680 it is unlikely unless we get that double dip, which 0:08:01.720 --> 0:08:03.600 at least from the data we're looking at, it doesn't 0:08:03.600 --> 0:08:06.600 look like it's coming just yet, that we have a 0:08:06.600 --> 0:08:10.320 major dislocation prior to the bid An administration being sworn 0:08:10.360 --> 0:08:12.880 in and hopefully getting you know, half a trillion dollars 0:08:13.000 --> 0:08:15.120 or more in fiscal stimulus. What's the data that you're 0:08:15.120 --> 0:08:17.920 looking at, Troy. Yeah, So look, I think if you 0:08:18.120 --> 0:08:20.679 think of the stimulus that's still in the system, there's 0:08:21.040 --> 0:08:24.520 two and a half trillion dollars more in commercial bank 0:08:24.600 --> 0:08:27.680 deposit accounts than there was coming into this year. For instance, 0:08:28.200 --> 0:08:30.560 you can look at the housing market, it's on fire. 0:08:31.200 --> 0:08:34.560 Mortgage debt service is the lowest it's been over forty years. 0:08:35.120 --> 0:08:37.200 You look at the over hundred billion dollars in death 0:08:37.200 --> 0:08:39.880 it's been maid down by the consumer. You look at 0:08:39.880 --> 0:08:43.000 the fact that wages and salaries have now gone above 0:08:43.040 --> 0:08:46.360 where they were coming into the pandemic. Now. Off setting that, 0:08:46.760 --> 0:08:49.480 of course, is that transfer payments have dropped from from 0:08:49.480 --> 0:08:51.880 fiscal stimus going down. So look across the board and 0:08:51.880 --> 0:08:54.520 when you see is that there's an enormous amount of 0:08:54.520 --> 0:08:57.640 stimulus that has yet to be spent, okay, and that's 0:08:57.640 --> 0:09:03.440 what's supporting consumption now even as UH enhanced unemployment drops off. 0:09:04.000 --> 0:09:06.319 At the same time, we have created ten million jobs 0:09:06.320 --> 0:09:09.760 where recaptured ten million plus jobs since the downturn. So 0:09:10.400 --> 0:09:13.760 there is the ability to consume. To your point of manufacturing. 0:09:13.880 --> 0:09:17.120 You've seen capetx pickup meeting fleet. Obviously, you've seen fiscal 0:09:17.160 --> 0:09:21.720 spending from the federal government pickup meeting fleet. Trade is 0:09:21.760 --> 0:09:25.920 not a net contributor, but those three cylinders are hitting 0:09:25.960 --> 0:09:29.199 strong enough, we think to keep us out of a recession, 0:09:29.360 --> 0:09:33.600 provided provided right that we do get another round of 0:09:33.679 --> 0:09:37.840 at least McConnell style stimulus sometimes in February and March 0:09:38.320 --> 0:09:44.839 if we don't get mcconos billion. Troy, Yeah, And it's 0:09:44.920 --> 0:09:47.280 unfortunately to joke ground all these things. Is there's real 0:09:47.559 --> 0:09:51.000 um you know, paying out there in the lower wage earns. 0:09:51.040 --> 0:09:54.280 But somewhere between a half a trillion was McConnell style, 0:09:54.400 --> 0:09:56.160 right and pulse he was two two and a half. 0:09:56.720 --> 0:10:00.520 You won would think that Biden and McConn work together 0:10:00.600 --> 0:10:02.880 very well over time. Remember they work together as being 0:10:03.000 --> 0:10:07.720 er McConnell and Biden that really strug out the administrations 0:10:07.760 --> 0:10:10.240 deal on two that as love it. Five hundred billion 0:10:10.320 --> 0:10:13.640 is still two and a half percent of GDP um. 0:10:13.720 --> 0:10:15.439 We were about three and a half PERCENTBLE or P 0:10:15.559 --> 0:10:18.240 GDP at the end of Q three, a remarkable number. 0:10:18.840 --> 0:10:21.079 Looks like we'll probably be around two percent LE or 0:10:21.160 --> 0:10:22.800 P GDP at the end of this year. So two 0:10:22.840 --> 0:10:24.840 and a half percent GDP is really all we need 0:10:24.840 --> 0:10:28.080 to get back to the peak level by the end 0:10:28.120 --> 0:10:31.160 of two two with the latest So let me stress 0:10:31.160 --> 0:10:33.080 test the confidence just a little bit, Troy, this kind 0:10:33.120 --> 0:10:36.320 of Vice President Mike Pence, he said, we strongly believe 0:10:36.360 --> 0:10:40.000 the vaccine distribution process could begin the week of December fourteenth, 0:10:40.000 --> 0:10:43.000 that was reportedly might pen speaking to governors in the 0:10:43.040 --> 0:10:45.679 last twenty four hours. Then we heard from Governor Newsom 0:10:45.720 --> 0:10:47.560 who had this to say, and I said it at 0:10:47.559 --> 0:10:49.880 the top of the hour. If these trends continue, we're 0:10:49.920 --> 0:10:53.400 going to have to take much more dramatic, arguably drastic action. 0:10:53.760 --> 0:10:56.839 How do you think this market with process, some form 0:10:56.880 --> 0:11:00.280 of shouter in place order from Governor Newsom, something much 0:11:00.320 --> 0:11:02.840 more strict than what we've seen already in the next 0:11:02.840 --> 0:11:06.280 couple of weeks. Yes, So that would certainly cause a 0:11:06.360 --> 0:11:10.679 short term pullback, not nothing meaningful, maybe one to right 0:11:11.000 --> 0:11:13.480 and again it's back to starting level, right think at 0:11:13.520 --> 0:11:17.400 the starting level markets now vix around twenty right, which 0:11:17.440 --> 0:11:22.120 has been the post crisis, post m vaccine or sorry, 0:11:22.120 --> 0:11:25.520 post pandemic crisis low um. We got up to forty 0:11:25.559 --> 0:11:29.360 at the end of October, collapse back down uh multiples 0:11:29.360 --> 0:11:33.400 at three x in more good news looking forward. Then 0:11:33.440 --> 0:11:36.400 there's been in quite some time in terms of the economy, 0:11:36.480 --> 0:11:38.160 in terms of what the fact that he needs to 0:11:38.200 --> 0:11:40.600 do in terms of the vaccine news. If you get 0:11:40.640 --> 0:11:42.800 a stay at home or like from the state as 0:11:42.880 --> 0:11:46.319 large as California. That will take a little bit of enthusiasm, 0:11:46.360 --> 0:11:48.800 and we may not have a strong December like we've 0:11:48.840 --> 0:11:51.120 had typically in the past, but we don't think it's 0:11:51.240 --> 0:11:54.880 enough to really cause a major dislocation. You know, it 0:11:54.920 --> 0:11:58.040 could get as bad as September October, but but you know, 0:11:58.120 --> 0:12:00.760 down six six and a half percent, you certainly isn't 0:12:00.800 --> 0:12:03.280 the end of the world. Um so much again depends 0:12:03.360 --> 0:12:05.040 upon the sack that the light at the end of 0:12:05.120 --> 0:12:07.520 the tunnel. It's so much brighter because of the multiple 0:12:07.640 --> 0:12:11.839 vaccine candidates which will finally get somebody's bombed out sectors 0:12:11.880 --> 0:12:15.480 like what lodging. Uh, you know, airlines, cruise lines and 0:12:15.520 --> 0:12:17.520 things that have really been the bottom leg of the 0:12:17.600 --> 0:12:21.360 k to come back. Uh sometimes you know q th 0:12:21.600 --> 0:12:24.800 nature Troy, It's great to catch up as always, you're 0:12:24.800 --> 0:12:28.040 looking well. Best of the team. T Scottish Capital Code. 0:12:28.320 --> 0:12:34.400 See I I'm got to see you, sir. I find 0:12:34.400 --> 0:12:38.040 the conversation about the economy far more interesting. Ethan Harris 0:12:38.120 --> 0:12:40.439 joins US now Bank of America Securities Head of Global 0:12:40.720 --> 0:12:44.079 Economic Research. Ethan Greater to catch ups. Talk to me 0:12:44.120 --> 0:12:47.000 about the difficulty in the months ahead and how much 0:12:47.080 --> 0:12:51.240 better you expected to get in the year after. Well, 0:12:51.280 --> 0:12:53.160 before I start there, I should point out that in 0:12:53.240 --> 0:12:58.080 this world of remote access, I've got a gutter cleaning 0:12:58.160 --> 0:13:00.440 crew that just arrived at my house, So it could 0:13:00.440 --> 0:13:04.400 get interesting here in a minute. Um, we understand, that's fine, 0:13:04.600 --> 0:13:07.280 you just went through it. At least I'm not showing 0:13:07.280 --> 0:13:12.080 my legs off though. But anyways, um uh, there's there's 0:13:12.120 --> 0:13:14.320 some kind of slow downcoming. I mean, we we know 0:13:14.520 --> 0:13:18.440 that people have learned to live with the virus, they 0:13:18.480 --> 0:13:20.680 figure out ways to get around it and continue to 0:13:20.960 --> 0:13:25.160 do economic activities. But you know, things are we're at 0:13:25.160 --> 0:13:30.000 almost worse than in the spring in terms of the caseload. Um. 0:13:30.040 --> 0:13:32.640 The shutdowns we've seen at the local level have been 0:13:32.679 --> 0:13:36.800 pretty limited, but they're going to be persistent because the 0:13:36.880 --> 0:13:39.760 number of cases isn't going to go away quickly, given 0:13:39.760 --> 0:13:42.360 all the holidays coming up and the kind of pandemic 0:13:42.360 --> 0:13:45.080 fatigue we have out there. So we're looking for growth 0:13:45.120 --> 0:13:47.760 to slow to about one percent in the first quarter 0:13:47.960 --> 0:13:52.079 is kind of the last vestige of this COVID crisis, 0:13:52.160 --> 0:13:55.400 and then from there, the vaccine story kicks in, the 0:13:55.440 --> 0:14:00.160 fiscal policy story kicks in, and we're much more optimistic, Ethan. 0:14:00.200 --> 0:14:02.240 We're looking at the economic day to come through worldwide, 0:14:02.240 --> 0:14:04.320 not just in the United States. We've had some soft 0:14:04.440 --> 0:14:07.200 jobless claims prints over the last couple of weeks, but worldwide, 0:14:07.200 --> 0:14:10.040 the p m I s have been terrific, particularly in Asia. 0:14:10.320 --> 0:14:12.280 You expect that as you come off a low base, 0:14:12.559 --> 0:14:14.760 that diffusion in the cities. You've written about this earlier 0:14:14.760 --> 0:14:17.599 this year, Ethan. My question though, is how difficult is 0:14:17.640 --> 0:14:22.000 it to draw a distinction between an infantry rebuild off 0:14:22.040 --> 0:14:25.440 the back of an unprecedented shock that is happening on 0:14:25.480 --> 0:14:29.960 a synchronized basis worldwide right now, and a robust early 0:14:30.080 --> 0:14:35.240 stage recovery. Can you make that distinction? Ethan? Yeah, I 0:14:35.240 --> 0:14:37.960 mean I think that that what we're seeing now is 0:14:38.040 --> 0:14:39.760 what you'd expect for p m I is to be 0:14:39.920 --> 0:14:43.840 if you're growing at say five UM and that's where 0:14:43.840 --> 0:14:48.080 we are right now. Um, you know, this isn't a surprise. 0:14:48.640 --> 0:14:51.240 It's a little bit strange that took this long for 0:14:51.280 --> 0:14:53.160 the p m I s to get to this level. 0:14:53.320 --> 0:14:56.320 I mean, where were they back in the summer when 0:14:56.360 --> 0:14:59.360 we you know, second quarter US GDP growth was thirt 0:15:00.000 --> 0:15:02.440 and the p m I s were like at fifty 0:15:02.480 --> 0:15:05.400 five or something that's way too low. So there's something 0:15:05.440 --> 0:15:08.480 a little bit strange about the way they they've kind 0:15:08.480 --> 0:15:12.440 of been lagging behind. But you know, readings in the 0:15:12.600 --> 0:15:17.240 in the high fifties are you know, a normal, healthy recovery. 0:15:17.920 --> 0:15:19.520 I do think they're going to cool off a little 0:15:19.520 --> 0:15:22.080 bit in the next couple of months, just because there's 0:15:22.120 --> 0:15:27.040 some real slowing going on, uh in Europe, US and 0:15:27.120 --> 0:15:30.680 much of the northern hemisphere. But um, you know, I 0:15:30.720 --> 0:15:33.280 don't you know, I don't feel this is an unusual 0:15:33.320 --> 0:15:35.760 thing to have numbers like this. Meanwhile, though, we are 0:15:35.880 --> 0:15:38.760 getting this incredible divergence between the manufacturing side of the 0:15:38.800 --> 0:15:41.520 economy and the service side of the economy, which has 0:15:41.600 --> 0:15:45.360 really led to an increased number of jobless claims. Are 0:15:45.400 --> 0:15:49.560 you seeing the likelihood increase of a negative print on 0:15:49.600 --> 0:15:53.680 this Friday's jobs report. Well, we don't expect a negative print, 0:15:53.760 --> 0:15:56.000 but I mean, the job market is going to be 0:15:56.120 --> 0:15:58.520 one of the sectors that slows a lot here in 0:15:58.560 --> 0:16:01.400 the next few months. Because while you can when you 0:16:01.480 --> 0:16:06.840 do restrictions and activities, you can certainly continue retail sales, 0:16:06.880 --> 0:16:09.680 you can have online spending, you can do uh, you know, 0:16:09.760 --> 0:16:13.120 you find find ways around the restrictions and shop and 0:16:13.200 --> 0:16:17.800 keep shopping. But what you can't prevent is a very 0:16:17.920 --> 0:16:23.240 weak holiday hiring season because brick and mortar is the 0:16:23.320 --> 0:16:27.440 dominant source of jobs, and so some slowing in the 0:16:27.520 --> 0:16:31.760 job markets inevitable. Uh. You know, we're still seeing uh, 0:16:31.840 --> 0:16:35.640 you know, a couple hundred thousand gain in pay rolls. 0:16:35.840 --> 0:16:39.880 But but you know, we we could get to flat 0:16:39.960 --> 0:16:42.320 numbers by the time we get into the first quarter. 0:16:42.640 --> 0:16:45.240 So when people talk about scarring, what numbers do you 0:16:45.280 --> 0:16:47.200 have to see before you start getting worried about a 0:16:47.200 --> 0:16:52.240 double deprocession. Well, I think that if we dropped to 0:16:52.640 --> 0:16:55.360 the kind of growth numbers we have and there's no 0:16:55.440 --> 0:16:59.200 fiscal package, then you you worry that you're going to 0:16:59.320 --> 0:17:02.600 dip into egg of territory before the vaccine kicks in. 0:17:02.720 --> 0:17:05.200 I mean, when you talk to people about the vaccine, 0:17:05.200 --> 0:17:07.880 it's important to keep in minds you don't need herd immunity. 0:17:07.920 --> 0:17:11.639 You don't need everyone immunized to benefit the economy. You 0:17:11.680 --> 0:17:15.119 need to have vulnerable populations immunize to the point where 0:17:15.480 --> 0:17:19.240 everyone feels comfortable that they're taking low risk, that this 0:17:19.320 --> 0:17:22.320 is something you can live with at the um. And 0:17:22.480 --> 0:17:28.359 so there's an increased engagement that comes with vaccinating vulnerable people. Uh, 0:17:28.400 --> 0:17:31.520 and the essential workers. Uh. You don't need to wait 0:17:31.560 --> 0:17:35.120 for the herd immunity to help the economy. But yeah, 0:17:35.119 --> 0:17:36.800 I mean we're gonna we're gonna have a bit of 0:17:36.840 --> 0:17:39.240 a dead spot here, you know, as we go into 0:17:39.280 --> 0:17:44.440 the first quarter, and the economy does need um fiscal stimulus. 0:17:44.440 --> 0:17:48.760 I mean, local governments need help, the small business need 0:17:48.800 --> 0:17:54.520 to help. Unemployments need help. You know, the benefits keep diminishing, 0:17:54.640 --> 0:17:57.400 so uh, it's very important they get a deal done. 0:17:57.400 --> 0:17:59.840 We do think they will. We think that's the probably 0:17:59.840 --> 0:18:02.680 the only serious legislation we get in the next two 0:18:02.760 --> 0:18:05.920 years will be the stimulus package out of the gate, 0:18:06.840 --> 0:18:12.400 because we really need it. Um, if we get split government, 0:18:13.000 --> 0:18:16.000 it's gonna be solid gridlock once we get past this 0:18:16.200 --> 0:18:22.640 initial kind of emergency funding situation. I don't unless it's 0:18:22.760 --> 0:18:27.880 somehow managed to pull the Georgia. Uh, you know, we're 0:18:27.880 --> 0:18:31.119 gonna have rock solid gridlock. I think Ethan grit to 0:18:31.160 --> 0:18:34.240 catch ups. Always appreciate your inside good fun as always, 0:18:34.280 --> 0:18:41.600 Ethan Harris that of Banks America Securities. Right now, let's 0:18:41.600 --> 0:18:44.639 turn to the issue at hand, which is still the pandemic. 0:18:44.680 --> 0:18:47.320 It is still twenty and the question is how quickly 0:18:47.359 --> 0:18:50.880 can we unrull or roll out these vaccinations in order 0:18:50.960 --> 0:18:54.320 to stop the pandemic and fulfill some of the hopium 0:18:54.480 --> 0:18:56.760 that we continue to see in markets joining us now 0:18:56.840 --> 0:18:59.960 Dr Jody Guest Emery University roll In School of Public Health, 0:19:00.200 --> 0:19:05.040 Department of Epidemiology, Vice Chair and Research Professor, Doctor Guest, 0:19:05.320 --> 0:19:08.400 let's just start with what the road looks like ahead 0:19:08.440 --> 0:19:14.000 to get a critical mass of people vaccinated. Good morning. Well, 0:19:14.000 --> 0:19:17.720 we certainly UM need a big uptake in the vaccine, 0:19:17.760 --> 0:19:20.160 which means we really need a lot of trust that 0:19:20.160 --> 0:19:22.680 the science has been great behind it and that this 0:19:22.760 --> 0:19:25.919 is a safe and effective vaccine that we want to 0:19:25.960 --> 0:19:30.920 make sure we get to everyone UM across the globe. Alright. 0:19:30.960 --> 0:19:32.560 So the reason why I ask this is because a 0:19:32.560 --> 0:19:34.920 lot of people are saying, well, we've got a vaccine, 0:19:34.920 --> 0:19:37.119 so you can fast forward to a better time ahead 0:19:37.359 --> 0:19:39.520 and price that in. But there is a question of 0:19:39.520 --> 0:19:42.080 how long it will take and how bad the pandemic 0:19:42.119 --> 0:19:45.200 could get before then? Can you talk about that process? 0:19:45.200 --> 0:19:47.080 In other words, that we're heading into the winter season, 0:19:47.119 --> 0:19:50.000 people are getting complacent, We're seeing virus numbers go to 0:19:50.040 --> 0:19:53.280 record highs, and we still are a ways away to 0:19:53.400 --> 0:19:57.239 that critical mass. Absolutely, so we've got a light at 0:19:57.240 --> 0:19:59.200 the end of our tunnel, but we are not there yet, 0:19:59.280 --> 0:20:01.520 and so we need everyone to continue to do what 0:20:01.600 --> 0:20:04.760 we've been asking, which is stay socially distanced, where their 0:20:04.800 --> 0:20:08.960 masks um you know, keep their gathering small, which is hard. 0:20:09.000 --> 0:20:11.280 We have a lot of pandemics fatigue at this point 0:20:11.280 --> 0:20:15.480 in time, but we are closed. But we must continue 0:20:15.840 --> 0:20:18.760 to do all of those incredibly important prevention measures to 0:20:18.800 --> 0:20:21.199 stay to keep our numbers down. As you said, they 0:20:21.240 --> 0:20:24.600 are skyrocketing across the United States and across the world 0:20:25.000 --> 0:20:28.160 at numbers that we've not even seen up until now. 0:20:28.680 --> 0:20:30.600 So we should get a vaccine first. I mean, guess 0:20:30.600 --> 0:20:33.280 we're going to have older individuals and perhaps nursing homes 0:20:33.359 --> 0:20:37.520 and healthcare professionals who next. I think we'll see a 0:20:37.560 --> 0:20:42.600 lot of frontline workers. UM, get the offered the vaccine next. Today, actually, 0:20:42.600 --> 0:20:46.480 the CDC is meeting and having a panel to discuss 0:20:46.200 --> 0:20:48.960 what the priorities will be and how those vaccines will 0:20:49.000 --> 0:20:51.520 be rolled out. Once you have a vaccine that has 0:20:51.600 --> 0:20:54.720 FDA approval, you have to go into a vaccination process 0:20:54.720 --> 0:20:57.000 of vaccine but itself doesn't work until we get it 0:20:57.000 --> 0:21:02.320 to people, and so that this vision will start today 0:21:02.480 --> 0:21:05.280 to really put together a robust plan of how the 0:21:05.359 --> 0:21:08.159 vaccines gets rolled out. What do you think is the 0:21:08.160 --> 0:21:12.359 most effective public relations effort to get people to have 0:21:12.400 --> 0:21:15.440 confidence in the vaccine to go seek them out, because 0:21:15.440 --> 0:21:19.040 that has been one of the biggest concerns. Absolutely so, 0:21:19.119 --> 0:21:21.840 I do believe that the fact that the FDA, which 0:21:21.880 --> 0:21:24.960 is going to start reviewing their data from Fiser and 0:21:25.040 --> 0:21:29.920 Maderna coming up um, they will be doing those those 0:21:30.200 --> 0:21:34.080 data reviews online and anyone could watch them. I think 0:21:34.119 --> 0:21:37.600 that that is an incredibly important offer for us to 0:21:37.600 --> 0:21:40.760 be able to all watch that. Additionally, the CDC review 0:21:40.800 --> 0:21:43.040 today about who's going to get the vaccine and the 0:21:43.160 --> 0:21:45.720 order in which they will get it will also be 0:21:45.800 --> 0:21:49.200 available for anyone to watch. And that transparency is really 0:21:49.240 --> 0:21:55.080 important because these vaccines have been um studied very quickly, 0:21:55.359 --> 0:21:58.520 but it does not mean the science has been too quick, 0:21:58.760 --> 0:22:01.080 and we want to make sure that everyone gets a 0:22:01.160 --> 0:22:03.680 chance to see that. Dr guess I want to talk 0:22:03.680 --> 0:22:07.520 a little bit about morale among nurses among doctors. I've 0:22:07.520 --> 0:22:10.320 read a number of stories and heard from people that 0:22:10.440 --> 0:22:14.280 it's exhausting, it's emotionally draining, it's traumatic. They went through 0:22:14.320 --> 0:22:16.440 the first wave, I know in New York City it 0:22:16.520 --> 0:22:20.960 was really traumatic for them, and now they're seeing numbers 0:22:21.000 --> 0:22:24.439 creep up again, and we're seeing that across the nation. 0:22:24.920 --> 0:22:28.240 How does that factor into what we are seeing now 0:22:28.400 --> 0:22:31.320 the structure of our health care system and how stretched 0:22:31.359 --> 0:22:35.160 it's getting. Well. I think as we think of supply 0:22:35.359 --> 0:22:38.480 chain that we've talked about a lot with COVID nineteen, 0:22:38.560 --> 0:22:41.760 where we were concerned about having enough gloves and maths 0:22:41.960 --> 0:22:44.879 and in hospital bed, one of the things we've not 0:22:44.920 --> 0:22:49.679 spent enough time talking about is enough employees, enough clinicians 0:22:49.920 --> 0:22:52.840 to care for all of these patients. People are working 0:22:53.520 --> 0:22:55.639 so many days in a row without days off, and 0:22:55.720 --> 0:22:59.320 that's exhausting. And when you see incredibly high death rates, 0:22:59.359 --> 0:23:05.399