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 --> 00:00:24,880 Speaker 1: Business App. Listen on demand wherever you get your podcasts, 5 00:00:25,280 --> 00:00:26,960 Speaker 1: or watch us live on YouTube. 6 00:00:27,160 --> 00:00:30,240 Speaker 2: One of our faith guests on these markets is Lisha Chalotte. 7 00:00:30,280 --> 00:00:33,960 Speaker 2: She's a chief investment officer for Morgan Stanley Investment Management. 8 00:00:34,200 --> 00:00:36,840 Speaker 2: You've heard of them. They're pretty good over there. I've 9 00:00:36,840 --> 00:00:39,240 Speaker 2: competed again to my whole career. I had some wins, 10 00:00:39,280 --> 00:00:40,640 Speaker 2: I had some losses over the years. 11 00:00:41,120 --> 00:00:41,840 Speaker 3: They're pretty good. 12 00:00:42,000 --> 00:00:44,640 Speaker 2: Lisa, we got to start with gold. I don't know 13 00:00:44,680 --> 00:00:46,720 Speaker 2: what's going on. Do you have any idea what's going on? 14 00:00:46,760 --> 00:00:47,960 Speaker 2: I mean, who's behind this stuff? 15 00:00:48,720 --> 00:00:50,879 Speaker 4: So I don't know if we have an idea. We 16 00:00:50,960 --> 00:00:55,120 Speaker 4: have a hypothesis, right, so you know, I know, over 17 00:00:55,160 --> 00:00:56,800 Speaker 4: the last couple of weeks, a lot of folks have 18 00:00:56,840 --> 00:01:00,160 Speaker 4: talked about gold as maybe a hedge to some of 19 00:01:00,200 --> 00:01:03,680 Speaker 4: the frothiness in the equity market, et cetera. But we've 20 00:01:03,720 --> 00:01:07,160 Speaker 4: really been on this extraordinary run for the past quite 21 00:01:07,200 --> 00:01:11,520 Speaker 4: frankly three years, since the bull market began in the 22 00:01:11,560 --> 00:01:16,720 Speaker 4: fall of twenty twenty two with gold massively outperforming stocks. 23 00:01:16,800 --> 00:01:19,000 Speaker 4: And so one of the things that you know, we've 24 00:01:19,040 --> 00:01:22,880 Speaker 4: begun to think about is not just dollar debasement, but 25 00:01:22,959 --> 00:01:26,679 Speaker 4: whether or not folks are really worried about fiat currencies 26 00:01:26,720 --> 00:01:31,000 Speaker 4: more broadly around the world, and as folks really truly 27 00:01:31,120 --> 00:01:35,919 Speaker 4: think about whether or not there is a credible, reliable 28 00:01:36,000 --> 00:01:40,640 Speaker 4: future for stable coins and for crypto, whether some of 29 00:01:40,680 --> 00:01:46,200 Speaker 4: this ecosystem needs to collateralize itself with gold away from 30 00:01:46,560 --> 00:01:49,520 Speaker 4: fiat currencies. And so one theory we have is that 31 00:01:49,840 --> 00:01:52,840 Speaker 4: some of these players may be trying to build some 32 00:01:52,880 --> 00:01:55,160 Speaker 4: reserves in the yellow metal. 33 00:01:55,080 --> 00:01:58,000 Speaker 5: Gold massively outperforming stocks. I wanted to go there because 34 00:01:58,000 --> 00:02:00,040 Speaker 5: this is not the correlation that we're accustomed to. And 35 00:02:00,080 --> 00:02:02,120 Speaker 5: as we talk about kind of the uniqueness of this moment, 36 00:02:02,160 --> 00:02:05,520 Speaker 5: perhaps the weirdness of this moment, what does that tell you? 37 00:02:05,600 --> 00:02:07,080 Speaker 5: How does that kind of shape the way that you're 38 00:02:07,120 --> 00:02:08,080 Speaker 5: looking at these markets? 39 00:02:08,440 --> 00:02:12,440 Speaker 4: Well, it really requires some some creativity because a lot 40 00:02:12,560 --> 00:02:15,640 Speaker 4: to your point, all of these correlations are breaking down. 41 00:02:16,400 --> 00:02:19,000 Speaker 4: And so one of the hypotheses that we have is 42 00:02:19,040 --> 00:02:22,720 Speaker 4: that you know, we've got this scenario where, yes, we 43 00:02:22,840 --> 00:02:26,720 Speaker 4: haven't seen inflation in the real economy. But perhaps we're 44 00:02:26,760 --> 00:02:30,480 Speaker 4: really starting to see inflation in financial assets, just too 45 00:02:30,560 --> 00:02:35,480 Speaker 4: much liquidity from everywhere around the world, slashing around looking 46 00:02:35,520 --> 00:02:41,080 Speaker 4: for places to go, and in the everything rally. You know, 47 00:02:41,160 --> 00:02:44,440 Speaker 4: we're seeing, you know, folks by you know, everything from 48 00:02:44,480 --> 00:02:47,440 Speaker 4: from gold to stocks, to bonds to currencies. 49 00:02:47,840 --> 00:02:50,919 Speaker 2: I like this quote in your notes, Lisa Boom. Markets 50 00:02:50,919 --> 00:02:52,880 Speaker 2: are meant to be written, not timed. 51 00:02:53,280 --> 00:02:54,320 Speaker 6: That's very good. 52 00:02:55,720 --> 00:02:58,720 Speaker 2: What we have heard, you know, maybe over the last 53 00:02:58,800 --> 00:03:01,000 Speaker 2: year two but really the last two four weeks is 54 00:03:01,080 --> 00:03:04,639 Speaker 2: just the concern about AI and it's been such a 55 00:03:04,639 --> 00:03:08,360 Speaker 2: big catalyst for the broader equity markets overall, not just 56 00:03:08,440 --> 00:03:11,200 Speaker 2: the tech space. But now we're starting to see some 57 00:03:11,240 --> 00:03:15,680 Speaker 2: of these circular deals where this company's investing in open AI, 58 00:03:15,720 --> 00:03:17,920 Speaker 2: who's then investing back and buying stuff and doing all 59 00:03:17,919 --> 00:03:21,120 Speaker 2: that kind of circular stuff. Kind of feels a little odd. 60 00:03:22,480 --> 00:03:25,079 Speaker 6: Is it odd to you? Does it feel frothy to you? 61 00:03:25,520 --> 00:03:27,000 Speaker 6: How do you think about that? It does? 62 00:03:27,240 --> 00:03:34,000 Speaker 4: And you know, for us, whenever these trends are transparent 63 00:03:34,160 --> 00:03:37,200 Speaker 4: and trackable, which they really were for the last three 64 00:03:37,280 --> 00:03:40,280 Speaker 4: or four years, you could say I see the order book, 65 00:03:40,440 --> 00:03:43,280 Speaker 4: I see the cash flow. I understand how they're going 66 00:03:43,320 --> 00:03:46,880 Speaker 4: to fund these cap X plans. But in the literally 67 00:03:46,920 --> 00:03:50,560 Speaker 4: in the last eight to ten weeks, the deal making, 68 00:03:50,880 --> 00:03:54,960 Speaker 4: the pace of the deal making and the interconnectedness of 69 00:03:55,000 --> 00:03:58,840 Speaker 4: all of it is starting to suggest to us that 70 00:03:58,920 --> 00:04:01,640 Speaker 4: we're getting to that part part of the cycle where 71 00:04:01,800 --> 00:04:03,320 Speaker 4: you know, the analysts start. 72 00:04:03,400 --> 00:04:04,800 Speaker 7: Making up new terms. 73 00:04:04,840 --> 00:04:09,440 Speaker 4: You know, this RPO and revenue that's been accounted for 74 00:04:09,640 --> 00:04:12,240 Speaker 4: that's still to be accounted for. It you know, kind 75 00:04:12,240 --> 00:04:15,880 Speaker 4: of harkens back to the eyeballs and and and uh, 76 00:04:16,120 --> 00:04:18,440 Speaker 4: you know, the the some of the words we made 77 00:04:18,560 --> 00:04:21,279 Speaker 4: up during the peak of the Internet. And so what 78 00:04:21,360 --> 00:04:25,400 Speaker 4: our hope is here is that as these deals are 79 00:04:25,680 --> 00:04:29,200 Speaker 4: rolled out, that the companies are making the effort to 80 00:04:29,400 --> 00:04:32,960 Speaker 4: really help us map what is real, what is on 81 00:04:33,040 --> 00:04:35,919 Speaker 4: the com uh and what is you know, potentially just 82 00:04:35,960 --> 00:04:40,320 Speaker 4: a promise that could vaporize, uh if if the demand 83 00:04:40,400 --> 00:04:40,840 Speaker 4: isn't there. 84 00:04:40,960 --> 00:04:44,120 Speaker 5: As we think about the potential for froth or or bubbles, 85 00:04:45,279 --> 00:04:47,520 Speaker 5: what's the time horizon that you're looking at. What's what's 86 00:04:47,560 --> 00:04:49,960 Speaker 5: the time by which these companies have to kind of 87 00:04:50,040 --> 00:04:51,919 Speaker 5: prove find the proof and the putting here that what 88 00:04:51,920 --> 00:04:54,560 Speaker 5: they're doing is actually leading to something that's uh that's 89 00:04:54,600 --> 00:04:57,000 Speaker 5: beyond just significant capecks over and over again. 90 00:04:57,279 --> 00:04:57,559 Speaker 7: Yeah. 91 00:04:57,640 --> 00:05:01,040 Speaker 4: So, so what we've you know, talked about is how 92 00:05:01,120 --> 00:05:04,120 Speaker 4: critical twenty twenty six is and probably the second half 93 00:05:04,160 --> 00:05:06,640 Speaker 4: of twenty twenty six. And the reason is because the 94 00:05:06,680 --> 00:05:10,160 Speaker 4: gains that we can really, you know, credibly get from 95 00:05:10,279 --> 00:05:13,920 Speaker 4: multiple expansion feels like we're getting to that point of 96 00:05:13,960 --> 00:05:18,440 Speaker 4: exhaustion and earnings need to come through. The controversy is 97 00:05:18,480 --> 00:05:22,799 Speaker 4: not you know, are there earnings for you know, the hyperscalers. 98 00:05:22,880 --> 00:05:26,719 Speaker 4: I think everyone believes that. The question is are there 99 00:05:27,160 --> 00:05:31,520 Speaker 4: productivity improvements from some of the folks who are implementing 100 00:05:32,279 --> 00:05:34,799 Speaker 4: And again we're I think we're. 101 00:05:34,640 --> 00:05:37,040 Speaker 7: Willing to hold our breath for another six to nine. 102 00:05:36,960 --> 00:05:40,720 Speaker 4: Months, but I think by next summer people are going 103 00:05:40,800 --> 00:05:42,839 Speaker 4: to start saying, hey, show me the money. 104 00:05:43,279 --> 00:05:47,320 Speaker 6: Yep, yep. How about are there certain sectors that's screening 105 00:05:47,320 --> 00:05:48,280 Speaker 6: well for you guys right now? 106 00:05:48,320 --> 00:05:49,600 Speaker 2: And we're innerstandingly best management? 107 00:05:50,120 --> 00:05:52,599 Speaker 4: Yeah, I mean, obviously I need to be careful about 108 00:05:53,400 --> 00:05:56,120 Speaker 4: you know, not talking my book, but you know, our 109 00:05:56,160 --> 00:06:01,360 Speaker 4: favorite sector for the last eighteen months has been financials. Obviously, 110 00:06:01,480 --> 00:06:05,159 Speaker 4: you know, maybe a tough tape to report into this morning, 111 00:06:05,160 --> 00:06:08,600 Speaker 4: but these numbers I think from this actor, you know, 112 00:06:08,640 --> 00:06:11,880 Speaker 4: look reasonably strong to us. They obviously will have the 113 00:06:11,920 --> 00:06:15,560 Speaker 4: tailwind of likely a steeper yield curve next year of 114 00:06:15,600 --> 00:06:19,560 Speaker 4: some uh, you know, deregulation in addition to a decent 115 00:06:19,640 --> 00:06:21,960 Speaker 4: deal backdrop. So I think that that's kind of an 116 00:06:21,960 --> 00:06:27,400 Speaker 4: ideal environment for them, and financials should be a place 117 00:06:27,480 --> 00:06:31,680 Speaker 4: where we start to see stories at least of jen 118 00:06:31,720 --> 00:06:34,880 Speaker 4: AI implementation driving margin expansion at least. 119 00:06:34,880 --> 00:06:38,000 Speaker 5: A few minutes ago, you mentioned dollar strength or dollar weakness. 120 00:06:38,000 --> 00:06:40,200 Speaker 5: I guess it's like glass half fuller class class empty. 121 00:06:40,400 --> 00:06:44,160 Speaker 5: But I'm curious how much that has been driving your 122 00:06:44,160 --> 00:06:46,840 Speaker 5: thinking over the last few months, The weekend dollar that 123 00:06:46,880 --> 00:06:48,520 Speaker 5: we've seen, and I look at the Bloomberg Dollar Spot 124 00:06:48,560 --> 00:06:50,240 Speaker 5: Index up a little bit here today, seeing a little 125 00:06:50,279 --> 00:06:52,760 Speaker 5: bit more strength today, But the story has been one 126 00:06:52,800 --> 00:06:54,560 Speaker 5: of a weaker dollar, And how is that shaping your 127 00:06:54,839 --> 00:06:55,400 Speaker 5: view of things? 128 00:06:56,160 --> 00:06:58,440 Speaker 3: It certainly, you know, does play into it. 129 00:06:58,480 --> 00:07:02,440 Speaker 4: I mean, we've had a view that inflation is going 130 00:07:02,480 --> 00:07:05,880 Speaker 4: to be sticky. And what folks need to remember is, 131 00:07:05,960 --> 00:07:10,080 Speaker 4: while you know, a weeker dollar can certainly be helpful 132 00:07:10,160 --> 00:07:14,000 Speaker 4: for the earnings dynamics for large multinationals who trade around 133 00:07:14,000 --> 00:07:18,160 Speaker 4: the world and their competitiveness. A weeker dollar actually inhibits 134 00:07:19,880 --> 00:07:23,800 Speaker 4: our ability to effectively price imports, and when you multiply 135 00:07:23,920 --> 00:07:29,000 Speaker 4: that by tariffs, it's actually an even bigger headwind. So 136 00:07:30,000 --> 00:07:32,440 Speaker 4: you know, we do think that that weeker dollar is 137 00:07:33,240 --> 00:07:36,040 Speaker 4: relevant to the real economy and to some of the 138 00:07:36,400 --> 00:07:37,240 Speaker 4: forecasts here. 139 00:07:37,680 --> 00:07:39,640 Speaker 6: Lisa, thank you so much for joining us. Really appreciate it. 140 00:07:39,760 --> 00:07:43,080 Speaker 2: Lisa Shallie, She's a chief investment officer for Morgan Stanley 141 00:07:43,240 --> 00:07:45,280 Speaker 2: Investment Management. 142 00:07:47,080 --> 00:07:51,240 Speaker 8: Stay with us. More from Bloomberg Surveillance coming up after this. 143 00:07:58,480 --> 00:08:02,080 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch US Live 144 00:08:02,160 --> 00:08:05,320 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 145 00:08:05,400 --> 00:08:09,040 Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or 146 00:08:09,200 --> 00:08:10,720 Speaker 1: watch US Live on YouTube. 147 00:08:10,920 --> 00:08:13,160 Speaker 2: Let's focus a little bit on the fixed income business, 148 00:08:13,160 --> 00:08:15,800 Speaker 2: because folks, you're getting nice returns in the fixed income 149 00:08:15,840 --> 00:08:16,400 Speaker 2: market this. 150 00:08:16,360 --> 00:08:18,480 Speaker 6: Year, led by corporate high yield. 151 00:08:18,480 --> 00:08:20,400 Speaker 2: It's giving you a nice six to seven percent total 152 00:08:20,480 --> 00:08:23,560 Speaker 2: all in return yields. Pulling back, I got the tenure 153 00:08:23,640 --> 00:08:26,680 Speaker 2: Treasury sitting right at four percent here today for the 154 00:08:26,720 --> 00:08:29,080 Speaker 2: tenure US Treasury. Karen Manna does this stuff for a living. 155 00:08:29,400 --> 00:08:33,679 Speaker 2: Jesus Vice President at Federator Hermes. Karen, where are you 156 00:08:33,760 --> 00:08:36,320 Speaker 2: spending your time these days in the fixed income markets? 157 00:08:36,360 --> 00:08:39,000 Speaker 6: Where do you see maybe some opportunities? 158 00:08:40,640 --> 00:08:44,160 Speaker 9: Good morning and thank you, Paul. We see opportunities really 159 00:08:44,200 --> 00:08:47,280 Speaker 9: toward the very front end of the curve. We think 160 00:08:47,320 --> 00:08:51,200 Speaker 9: the exercise for investors right now is carefully considering their 161 00:08:51,240 --> 00:08:55,960 Speaker 9: cash visa VID, their money market funds, their deposits, anything 162 00:08:56,000 --> 00:08:59,280 Speaker 9: that is interest bearing and related to the movement of 163 00:08:59,320 --> 00:09:04,240 Speaker 9: the Federated Federal Reserve directly. So we think considering the 164 00:09:04,280 --> 00:09:06,560 Speaker 9: front end of the yield curve one to five that 165 00:09:06,640 --> 00:09:09,600 Speaker 9: will have the most influencer, feel the most influence from 166 00:09:09,640 --> 00:09:13,000 Speaker 9: the Federal Reserve, and then staying up in quality in 167 00:09:13,040 --> 00:09:16,000 Speaker 9: your investments set in remaining diversified. 168 00:09:16,320 --> 00:09:17,959 Speaker 5: Karen, you may have missed it, but yesterday Paul and 169 00:09:18,000 --> 00:09:20,320 Speaker 5: I were scratching our heads. The bond market was closed, 170 00:09:20,360 --> 00:09:22,440 Speaker 5: of course, and we wondered why is that. 171 00:09:22,240 --> 00:09:23,760 Speaker 6: The equity markets were open. 172 00:09:23,800 --> 00:09:26,160 Speaker 5: But I'm wondering if you can help us with the 173 00:09:26,160 --> 00:09:29,480 Speaker 5: interplay here between earning season and the bond market. That 174 00:09:29,480 --> 00:09:31,240 Speaker 5: you know, so, what are you going to be watching 175 00:09:31,240 --> 00:09:33,360 Speaker 5: for and how much volatility you were expecting here in 176 00:09:33,360 --> 00:09:35,080 Speaker 5: the next few days? As we get these big results 177 00:09:35,080 --> 00:09:36,400 Speaker 5: from from the financials. 178 00:09:36,000 --> 00:09:39,400 Speaker 9: In particular, of course, you have to dig in. For 179 00:09:39,520 --> 00:09:41,920 Speaker 9: us bond people take it an extra holiday just here 180 00:09:41,920 --> 00:09:44,440 Speaker 9: and there, just take it a day off the sharpen 181 00:09:44,480 --> 00:09:47,000 Speaker 9: the pencils and do the math. Now, earning season is 182 00:09:47,040 --> 00:09:50,920 Speaker 9: going to be very very important, particularly here as we 183 00:09:51,160 --> 00:09:55,160 Speaker 9: really start off with the banking earnings and listen to 184 00:09:55,200 --> 00:09:59,240 Speaker 9: what these companies are saying. So already today you're hearing 185 00:09:59,400 --> 00:10:03,880 Speaker 9: the sharp impact and shifts related to policy, a step 186 00:10:03,920 --> 00:10:09,120 Speaker 9: back from EVS, learning about how deregulation or lack of 187 00:10:09,160 --> 00:10:13,000 Speaker 9: regulation is going to impact the banks, how they're benefiting 188 00:10:13,080 --> 00:10:15,800 Speaker 9: from what could be or should be a foe in 189 00:10:15,840 --> 00:10:19,400 Speaker 9: private lending, but it's actually benefiting some of the larger 190 00:10:19,400 --> 00:10:22,320 Speaker 9: banks here. Those are the trends that we will look for. 191 00:10:22,920 --> 00:10:26,439 Speaker 9: In turn, the fixed income market can be very sensitive 192 00:10:26,480 --> 00:10:30,880 Speaker 9: to issuance supply and demand set prices. So we'll see 193 00:10:30,920 --> 00:10:33,760 Speaker 9: what these self funding banks do this week. Do they 194 00:10:33,840 --> 00:10:37,240 Speaker 9: need to issue more or do they anticipate that their 195 00:10:37,280 --> 00:10:40,679 Speaker 9: capital reserve buffers will be lowered and they won't have 196 00:10:40,760 --> 00:10:41,720 Speaker 9: to issue as much. 197 00:10:43,160 --> 00:10:44,959 Speaker 6: Karen, we can sid it into your treasury here. 198 00:10:45,040 --> 00:10:47,760 Speaker 2: Get close to three point five percent is that that's 199 00:10:47,800 --> 00:10:49,880 Speaker 2: not a bad way to make a living, or you 200 00:10:49,920 --> 00:10:51,640 Speaker 2: want to take some credit risk here in this market, 201 00:10:53,120 --> 00:10:53,480 Speaker 2: I like. 202 00:10:53,440 --> 00:10:56,920 Speaker 9: Clipping coupons here. I think you can do well with 203 00:10:57,400 --> 00:11:01,240 Speaker 9: very minor credit with risk. What we're not recommending right 204 00:11:01,280 --> 00:11:06,080 Speaker 9: now is stretching into high yield, particularly into the darker, 205 00:11:06,400 --> 00:11:09,320 Speaker 9: deeper parts of the market, the triple c's, the lower 206 00:11:09,400 --> 00:11:13,760 Speaker 9: rated entities there, you really aren't being compensated for the 207 00:11:13,880 --> 00:11:17,440 Speaker 9: risk we like in corporate credit, nice triple B risk, 208 00:11:17,559 --> 00:11:21,360 Speaker 9: but really moderating. Knowing the credit stories, we have seen 209 00:11:21,400 --> 00:11:25,240 Speaker 9: those headlines that have reverberated through our credit markets and 210 00:11:25,320 --> 00:11:29,840 Speaker 9: even equities at moments about folks that maybe didn't just 211 00:11:29,920 --> 00:11:33,880 Speaker 9: do the basic blocking and tackling of fixed income work. 212 00:11:34,040 --> 00:11:36,839 Speaker 9: What were the deals structured? Like, was it too much 213 00:11:37,320 --> 00:11:40,959 Speaker 9: chasing a deal getting money to work at a higher 214 00:11:41,040 --> 00:11:45,120 Speaker 9: yield than really thinking through the process, checking the collateralization 215 00:11:45,600 --> 00:11:48,040 Speaker 9: and doing the basics of fixed income work. So stay 216 00:11:48,080 --> 00:11:50,600 Speaker 9: toward the front end of the curve up in quality. 217 00:11:50,679 --> 00:11:53,440 Speaker 9: And that's what we're hearing from many of our institutional 218 00:11:53,480 --> 00:11:57,280 Speaker 9: clients as well, is that emphasis for just having fixed 219 00:11:57,280 --> 00:12:01,040 Speaker 9: income do its basic job. Be the ballast of the 220 00:12:01,080 --> 00:12:04,320 Speaker 9: portfolio clip the coup on not be too far over 221 00:12:04,360 --> 00:12:06,040 Speaker 9: your skis, Caaren. 222 00:12:06,040 --> 00:12:07,960 Speaker 5: We look at the markets and see very little reaction 223 00:12:08,280 --> 00:12:11,480 Speaker 5: manifest from this government shut down, So maybe indirectly we're 224 00:12:11,480 --> 00:12:13,320 Speaker 5: seeing more of a reaction than in terms of not 225 00:12:13,440 --> 00:12:15,680 Speaker 5: having the data that we're accustomed to. And I'm curious 226 00:12:15,679 --> 00:12:18,800 Speaker 5: how you're kind of finding your way through this world 227 00:12:18,880 --> 00:12:20,920 Speaker 5: without it. We're going to get these CPI data, but 228 00:12:20,960 --> 00:12:24,120 Speaker 5: delayed by more than a week brought folks back into 229 00:12:24,400 --> 00:12:26,000 Speaker 5: make sure that we get that on the twenty fourth 230 00:12:26,000 --> 00:12:28,840 Speaker 5: of October. How are you making your way through? How's 231 00:12:28,880 --> 00:12:31,360 Speaker 5: that complicating matters for you as an investor? And how's 232 00:12:31,360 --> 00:12:33,840 Speaker 5: it complicating matters for federal reserve policymakers who are getting 233 00:12:33,840 --> 00:12:34,719 Speaker 5: ready to meet here at the end. 234 00:12:34,640 --> 00:12:35,120 Speaker 4: Of the month. 235 00:12:36,640 --> 00:12:39,959 Speaker 9: Sure, thank you, David. It is a very interesting time. 236 00:12:40,040 --> 00:12:44,440 Speaker 9: We seem to shrug off these government closures and lack 237 00:12:44,480 --> 00:12:47,520 Speaker 9: of data, and I think there's too much of an assumption, 238 00:12:47,800 --> 00:12:52,080 Speaker 9: almost a complacency again, that the federal reserves path is 239 00:12:52,200 --> 00:12:57,320 Speaker 9: completely known rather than data dependent, and the fixed income 240 00:12:57,360 --> 00:13:00,760 Speaker 9: market is being pushed around by other forces? Is right now? 241 00:13:01,120 --> 00:13:05,120 Speaker 9: We're being pushed by the policies the administration the talk 242 00:13:05,160 --> 00:13:08,160 Speaker 9: between China and the US, and that's why you're seeing 243 00:13:08,200 --> 00:13:12,480 Speaker 9: the tenure yield here reflecting a safe haven type of 244 00:13:12,480 --> 00:13:15,680 Speaker 9: a move, even the dollar bouncing a little bit stronger. 245 00:13:16,040 --> 00:13:21,080 Speaker 9: So it's the concerns globally right now and with our 246 00:13:21,200 --> 00:13:25,120 Speaker 9: policies with these other superpowers that I think is really 247 00:13:25,200 --> 00:13:28,080 Speaker 9: weighing on the yield curve at the moment and allowing 248 00:13:28,160 --> 00:13:31,319 Speaker 9: us to shrug off the lack of data. Of course, 249 00:13:31,360 --> 00:13:34,520 Speaker 9: we'll look at private market sources to some extent, but 250 00:13:34,640 --> 00:13:37,800 Speaker 9: the notion right now is that the labor market is 251 00:13:38,000 --> 00:13:41,840 Speaker 9: firm but beginning to show signs of weakness, and that 252 00:13:41,880 --> 00:13:45,200 Speaker 9: the Federal Reserve will continue with two eases of twenty 253 00:13:45,200 --> 00:13:48,960 Speaker 9: five basis points each over the remaining two meetings this year, 254 00:13:49,240 --> 00:13:51,480 Speaker 9: and the bond market is taking that as somewhat of. 255 00:13:51,400 --> 00:13:54,040 Speaker 6: A known all right, Karen, thank you so much for 256 00:13:54,120 --> 00:13:54,640 Speaker 6: joining us. 257 00:13:54,720 --> 00:13:57,640 Speaker 2: I always love chatting with you about the fixed income business. 258 00:13:57,679 --> 00:14:00,600 Speaker 2: Karen Matta, she's a vice president at Federated Hermes. 259 00:14:02,360 --> 00:14:03,080 Speaker 6: Stay with us. 260 00:14:03,320 --> 00:14:13,640 Speaker 8: More from Bloomberg Surveillance coming up after this. 261 00:14:13,640 --> 00:14:17,559 Speaker 1: This is the Bloomberg Surveillance podcast. Listen live each weekday 262 00:14:17,559 --> 00:14:20,880 Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto 263 00:14:21,000 --> 00:14:23,960 Speaker 1: with the Bloomberg Business app. You can also listen live 264 00:14:24,040 --> 00:14:27,640 Speaker 1: on Amazon Alexa from our flagship New York station, Just 265 00:14:27,680 --> 00:14:30,200 Speaker 1: say Alexa Play Bloomberg eleven thirty. 266 00:14:30,400 --> 00:14:32,360 Speaker 6: I want to talk a little bit about alternatives. 267 00:14:32,440 --> 00:14:35,560 Speaker 2: They're a bigger part of the investment of landscape than 268 00:14:35,640 --> 00:14:38,680 Speaker 2: I at least initially thought and held for a long time. 269 00:14:38,720 --> 00:14:41,800 Speaker 2: And that's both on the retail and institutional level. Shane 270 00:14:41,920 --> 00:14:45,200 Speaker 2: Sissel joins us here. She focuses a lot on alternatives. 271 00:14:45,200 --> 00:14:48,840 Speaker 2: She's a founder and CEO of Bandry on Capital Management. Shane, 272 00:14:48,920 --> 00:14:51,480 Speaker 2: thanks so much for joining us here. Love to just 273 00:14:51,520 --> 00:14:54,320 Speaker 2: get your thoughts about kind of where you see some 274 00:14:54,480 --> 00:14:58,560 Speaker 2: opportunities in the world of alternative investments today. We've seen 275 00:14:59,120 --> 00:15:02,440 Speaker 2: precious metal have amazing runs here, we're seeing crypto with 276 00:15:02,480 --> 00:15:04,120 Speaker 2: a lot of volatility moving higher. 277 00:15:04,600 --> 00:15:05,840 Speaker 6: Where are you seeing opportunities? 278 00:15:06,960 --> 00:15:10,640 Speaker 10: Well, I don't know if I consider those the kind 279 00:15:10,640 --> 00:15:15,480 Speaker 10: of alternatives that you should be paying attention to those alternatives. 280 00:15:15,520 --> 00:15:18,240 Speaker 10: Crypto maybe not as much, but precious metals, things of 281 00:15:18,320 --> 00:15:21,720 Speaker 10: real assets. That has been an asset class that's been 282 00:15:21,720 --> 00:15:24,280 Speaker 10: around for a really long time. There have been ways 283 00:15:24,280 --> 00:15:27,280 Speaker 10: people have found to put in their portfolios. Those allocations. 284 00:15:27,680 --> 00:15:31,280 Speaker 10: Where the more interesting things are happening are on the 285 00:15:31,320 --> 00:15:36,240 Speaker 10: evolution and the democratization of strategies that typically were only 286 00:15:36,280 --> 00:15:41,920 Speaker 10: available to accredited investors in qualified purchasers, individuals who had 287 00:15:42,120 --> 00:15:45,800 Speaker 10: networks and excess of a million to five million dollars, 288 00:15:46,120 --> 00:15:50,560 Speaker 10: and so they're now being available and different types of 289 00:15:50,640 --> 00:15:56,280 Speaker 10: structures that make them accessible to everybody, things like interval 290 00:15:56,320 --> 00:16:00,280 Speaker 10: funds ETFs. It started with mutual funds in two thousands, Evan, 291 00:16:00,320 --> 00:16:04,240 Speaker 10: when the rules changed for the nineteen forty Act that 292 00:16:04,720 --> 00:16:07,640 Speaker 10: made it possible to do hedging and hedge fund like 293 00:16:07,680 --> 00:16:13,520 Speaker 10: strategies in a pure liquid form twenty nineteen, twenty twenty, 294 00:16:13,600 --> 00:16:15,080 Speaker 10: active ETFs became a thing. 295 00:16:15,480 --> 00:16:16,840 Speaker 7: Then it became available there. 296 00:16:17,280 --> 00:16:19,360 Speaker 10: Now we've seen this rise of interval funds, which are 297 00:16:19,400 --> 00:16:25,120 Speaker 10: making ill liquid assets available in a structure that is 298 00:16:25,160 --> 00:16:28,160 Speaker 10: accessible to everybody. So now you can get private credit, 299 00:16:28,160 --> 00:16:33,200 Speaker 10: private equity, you know, real estate, the actual physical real estate, 300 00:16:33,360 --> 00:16:37,640 Speaker 10: real estate, debt, venture capital, all of those things are 301 00:16:37,680 --> 00:16:43,600 Speaker 10: now accessible to the broad broadpool of investors. And these 302 00:16:43,640 --> 00:16:46,840 Speaker 10: things were not possible before. So now we have I 303 00:16:46,880 --> 00:16:51,520 Speaker 10: almost feel like a flattening of access where it used 304 00:16:51,520 --> 00:16:53,600 Speaker 10: to be the haves and have nots. We don't have 305 00:16:53,680 --> 00:16:56,960 Speaker 10: that as much now. It becomes more of what about 306 00:16:57,000 --> 00:16:59,400 Speaker 10: the quality of the product that's being put out there, Like, 307 00:16:59,440 --> 00:17:03,480 Speaker 10: what's what's driving the push in these markets? I would 308 00:17:03,560 --> 00:17:06,080 Speaker 10: argue that there's a lot of good product going out 309 00:17:06,080 --> 00:17:10,320 Speaker 10: there from smaller shops that are looking to be able 310 00:17:10,400 --> 00:17:13,359 Speaker 10: to access a broader pool of investors. And then I 311 00:17:13,359 --> 00:17:16,000 Speaker 10: would say there's also some product that's being put out 312 00:17:16,000 --> 00:17:22,480 Speaker 10: there that maybe isn't as attractive to the institutional investor, 313 00:17:23,320 --> 00:17:25,800 Speaker 10: and so it's kind of being pushed down market, and 314 00:17:25,840 --> 00:17:29,040 Speaker 10: I would argue that's probably not the best product. So 315 00:17:29,400 --> 00:17:34,840 Speaker 10: there's definitely some issues, but overall, the trend we're seeing 316 00:17:35,000 --> 00:17:39,040 Speaker 10: is just accessibility to types of strategies that were typically 317 00:17:39,040 --> 00:17:43,199 Speaker 10: not available to the average investor. The gatekeeping and that 318 00:17:43,359 --> 00:17:44,359 Speaker 10: respect has gone away. 319 00:17:44,520 --> 00:17:46,720 Speaker 5: Are you on the sidelines? Maybe not on the sidelines, 320 00:17:46,760 --> 00:17:50,119 Speaker 5: but are are you cheering the democratization of investment in 321 00:17:50,160 --> 00:17:52,480 Speaker 5: the way that you describe? In other words, is having 322 00:17:52,480 --> 00:17:55,399 Speaker 5: all of these options available to retail investors a positive 323 00:17:55,440 --> 00:17:59,280 Speaker 5: thing inherently or is this something that gives you pause? 324 00:18:00,240 --> 00:18:00,480 Speaker 4: Again? 325 00:18:00,480 --> 00:18:04,119 Speaker 5: The kind of regular investors' ability now to invest in 326 00:18:04,119 --> 00:18:06,800 Speaker 5: the kinds of bespoke or there, I say, kind of 327 00:18:06,800 --> 00:18:09,800 Speaker 5: boutique funds you're talking about, Well. 328 00:18:09,640 --> 00:18:11,120 Speaker 7: There's a couple of things. 329 00:18:11,280 --> 00:18:16,119 Speaker 10: I have mixed feelings, right, So my entire company is 330 00:18:16,160 --> 00:18:22,400 Speaker 10: focused on making all successful to mass affluent financial advisors 331 00:18:22,400 --> 00:18:26,640 Speaker 10: and their clients, so most investors, and I'm certainly supportive 332 00:18:26,640 --> 00:18:28,520 Speaker 10: of that. You know, the reason I became so passionate 333 00:18:28,560 --> 00:18:31,560 Speaker 10: about alt was because I got exposed to them during 334 00:18:31,560 --> 00:18:33,440 Speaker 10: the Financial crisis when I was working for a hedge 335 00:18:33,440 --> 00:18:35,960 Speaker 10: fund and I thought to myself, Wow, there's some really 336 00:18:35,960 --> 00:18:38,960 Speaker 10: interesting stuff here. I wish my dad could invest in 337 00:18:39,000 --> 00:18:42,040 Speaker 10: something like this. It might have helped him kind of 338 00:18:42,160 --> 00:18:45,480 Speaker 10: manage the risk in his portfolio during the financial crisis. 339 00:18:45,640 --> 00:18:49,440 Speaker 10: So there's value. But the problem is, as I noted, 340 00:18:49,760 --> 00:18:52,840 Speaker 10: there's not always the best product that's being pushed here. 341 00:18:52,880 --> 00:18:56,520 Speaker 10: A lot of it is just well packaged marketing. And 342 00:18:56,600 --> 00:18:59,159 Speaker 10: I see that more and more, especially with some of 343 00:18:59,200 --> 00:19:03,280 Speaker 10: the innovations out in crypto buffers and crypto hedge products 344 00:19:03,359 --> 00:19:04,800 Speaker 10: and levered crypto products. 345 00:19:05,119 --> 00:19:06,439 Speaker 7: Those things concern me. 346 00:19:06,760 --> 00:19:09,240 Speaker 10: I think my biggest concern is the lack of education, 347 00:19:09,520 --> 00:19:15,080 Speaker 10: the lack of proper classification, the push for these new 348 00:19:15,160 --> 00:19:18,240 Speaker 10: and exciting things under the guise of well, now you 349 00:19:18,240 --> 00:19:22,600 Speaker 10: can finally access it, but not really having the understanding 350 00:19:22,720 --> 00:19:26,159 Speaker 10: of some of the complexities of these products. And so 351 00:19:26,600 --> 00:19:29,120 Speaker 10: there are a lot of places where even the average investor, 352 00:19:29,160 --> 00:19:32,440 Speaker 10: even though it is accessible to them, there are gates 353 00:19:32,520 --> 00:19:34,920 Speaker 10: that kind of they are hurdles they have to jump 354 00:19:34,920 --> 00:19:38,560 Speaker 10: in order to actually make the investment. I know, most people, 355 00:19:38,840 --> 00:19:41,359 Speaker 10: if you were to go into your Fidelity or Schwab 356 00:19:41,400 --> 00:19:44,240 Speaker 10: account today, most people, not all people, but most people. 357 00:19:44,520 --> 00:19:49,119 Speaker 10: If you have not major risk tolerance, uber aggressive and 358 00:19:49,200 --> 00:19:53,000 Speaker 10: you try to trade and I'll turn to VTF, you can't, 359 00:19:53,480 --> 00:19:54,439 Speaker 10: You'll get blocked out of it. 360 00:19:54,760 --> 00:19:57,159 Speaker 7: So there are some hurdles in that extent. 361 00:19:57,520 --> 00:20:00,680 Speaker 10: I think the bigger problem is that there's the lack 362 00:20:00,720 --> 00:20:05,040 Speaker 10: of education, because I actually believe that the broader investment 363 00:20:05,200 --> 00:20:10,760 Speaker 10: professional universe that pool maybe isn't as knowledgeable about these 364 00:20:10,760 --> 00:20:13,560 Speaker 10: products as they would like to be, and there's some 365 00:20:13,640 --> 00:20:14,840 Speaker 10: fear associated with that. 366 00:20:15,200 --> 00:20:16,960 Speaker 7: But rather than addressing. 367 00:20:16,440 --> 00:20:20,680 Speaker 10: It having intellectual curiosity and having resources which you can 368 00:20:20,720 --> 00:20:24,640 Speaker 10: become educated, I think that's the missing link that concerns 369 00:20:24,680 --> 00:20:28,119 Speaker 10: me is just things being packaged and marketed really well, 370 00:20:28,640 --> 00:20:32,040 Speaker 10: but not fully understanding the complexity or even the design elements, 371 00:20:32,119 --> 00:20:34,080 Speaker 10: especially with interval funds of these products. 372 00:20:34,720 --> 00:20:36,520 Speaker 6: Shanna, thanks so much for joining us. 373 00:20:36,520 --> 00:20:39,919 Speaker 2: Always appreciate learning about you're a part of the business 374 00:20:39,920 --> 00:20:41,920 Speaker 2: and getting a few minutes of your time. Shane Sissel, 375 00:20:41,960 --> 00:20:45,639 Speaker 2: She's a founder and CEO of ben Rion Capital Management. 376 00:20:47,359 --> 00:20:48,080 Speaker 6: Stay with us. 377 00:20:48,320 --> 00:20:58,960 Speaker 8: More from Bloomberg Surveillance coming up after this. 378 00:20:58,960 --> 00:21:02,880 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 379 00:21:02,920 --> 00:21:06,320 Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto 380 00:21:06,359 --> 00:21:09,159 Speaker 1: with the Bloomberg Business app. You can also watch us 381 00:21:09,200 --> 00:21:13,080 Speaker 1: live every weekday on YouTube and always on the Bloomberg terminal. 382 00:21:13,280 --> 00:21:17,000 Speaker 2: It is that time again. It is Lisa Matteo Newspapers. 383 00:21:17,040 --> 00:21:19,320 Speaker 2: I'm a little nervous about this one. Let's start it off. 384 00:21:19,560 --> 00:21:20,120 Speaker 6: Let's do it. 385 00:21:20,160 --> 00:21:22,560 Speaker 3: What's a day without Taylor Swift news? Right, Okay, So 386 00:21:22,680 --> 00:21:24,720 Speaker 3: let's start there. I know David loves it. 387 00:21:24,720 --> 00:21:25,000 Speaker 6: Okay. 388 00:21:25,080 --> 00:21:27,240 Speaker 3: So the Wall Street Journal has this look into how 389 00:21:27,520 --> 00:21:31,280 Speaker 3: she rewrote the business of record sales and so her 390 00:21:31,280 --> 00:21:33,760 Speaker 3: album The Life was Showgirl, right. It came out October third, 391 00:21:34,000 --> 00:21:37,479 Speaker 3: in five days, had more than four million and album sales. 392 00:21:37,880 --> 00:21:39,640 Speaker 3: So the reason how she did it is she put 393 00:21:39,680 --> 00:21:42,960 Speaker 3: out thirty eight different variations of the album. Yes, so 394 00:21:43,040 --> 00:21:46,520 Speaker 3: musical copies, well, yeah, like CD's vinyls. You know, you 395 00:21:46,680 --> 00:21:49,320 Speaker 3: have the digital downloads, you have cassette versions. You have 396 00:21:49,400 --> 00:21:52,120 Speaker 3: some that have like jewelry with it, or some only 397 00:21:52,119 --> 00:21:55,520 Speaker 3: have like certain acoustics songs, so the fans go crazy 398 00:21:55,560 --> 00:21:57,120 Speaker 3: and they have to get up each one, and that 399 00:21:57,160 --> 00:21:59,640 Speaker 3: brings up their album sales even more. So I don't 400 00:21:59,680 --> 00:22:01,639 Speaker 3: know how man versus to me. 401 00:22:01,720 --> 00:22:03,960 Speaker 5: You can still get a cassette copy of this is, 402 00:22:04,040 --> 00:22:05,919 Speaker 5: but we did the digital download we didn't get. I mean, 403 00:22:06,200 --> 00:22:08,440 Speaker 5: like my daughter might not know about these other things yet, 404 00:22:08,560 --> 00:22:10,760 Speaker 5: so I'm hoping that's the case, Perhpe. She's not listening 405 00:22:10,920 --> 00:22:12,240 Speaker 5: everything she tells us. 406 00:22:12,800 --> 00:22:15,960 Speaker 2: I mean, so again, I was born during Beatlemania, so 407 00:22:16,000 --> 00:22:18,560 Speaker 2: I don't have a first hand appreciation of it, but 408 00:22:18,600 --> 00:22:20,879 Speaker 2: this seems to this has just been the biggest thing, 409 00:22:20,880 --> 00:22:22,359 Speaker 2: and I think in music since. 410 00:22:22,720 --> 00:22:24,960 Speaker 5: I mean, just as we saw those Disney shares jump 411 00:22:24,960 --> 00:22:27,280 Speaker 5: on the heels of that announcement yesterday for this documentary 412 00:22:27,280 --> 00:22:29,160 Speaker 5: series with her. So yeah, there's there's little she. 413 00:22:29,119 --> 00:22:31,760 Speaker 6: Does wrong release and we shouldn't have a wedding dates. No, 414 00:22:31,880 --> 00:22:32,680 Speaker 6: there's no wedding dates. 415 00:22:33,040 --> 00:22:35,119 Speaker 3: Can you see how that probably and that's going to 416 00:22:35,160 --> 00:22:37,520 Speaker 3: spark it even more. Yes, okay, and this is like 417 00:22:37,520 --> 00:22:39,720 Speaker 3: a love album too, so it's like the kind of 418 00:22:39,840 --> 00:22:42,159 Speaker 3: tie into all that. All right, I want to go 419 00:22:42,200 --> 00:22:45,360 Speaker 3: to the Washington Post. We've been talking about federal agencies 420 00:22:45,400 --> 00:22:48,359 Speaker 3: right dealing with government shutdowns layoffs, but now the Post 421 00:22:48,400 --> 00:22:51,240 Speaker 3: has a look into to another strain. It's this wave 422 00:22:51,400 --> 00:22:55,760 Speaker 3: of retirement. They're saying, it's like this mass exodus. I'll 423 00:22:55,760 --> 00:22:57,720 Speaker 3: give you the numbers. It includes one hundred and fifty 424 00:22:57,760 --> 00:23:01,439 Speaker 3: four thousand federal employees accepted eye out offers. They were 425 00:23:01,520 --> 00:23:03,199 Speaker 3: largely moved from the payroll as at the end of 426 00:23:03,200 --> 00:23:05,400 Speaker 3: the month, and some of those are among the nearly 427 00:23:05,400 --> 00:23:08,480 Speaker 3: one hundred and five thousand employees who took regular retirement 428 00:23:08,720 --> 00:23:10,560 Speaker 3: during the fiscal year that added September, and that's like 429 00:23:10,560 --> 00:23:14,200 Speaker 3: an eighteen percent increase, So more people retiring on top 430 00:23:14,240 --> 00:23:16,040 Speaker 3: of this that they have to deal with. And the 431 00:23:16,080 --> 00:23:18,680 Speaker 3: problem is that they don't have enough workers and you know, 432 00:23:19,080 --> 00:23:21,880 Speaker 3: to staff to process all these. 433 00:23:21,920 --> 00:23:23,960 Speaker 5: They actually don't have the workers to process the retirements. 434 00:23:24,040 --> 00:23:27,320 Speaker 6: Yeah, didn't they get doged out? 435 00:23:27,359 --> 00:23:29,000 Speaker 5: I guess I don't know. 436 00:23:29,480 --> 00:23:32,440 Speaker 6: All I know is I'm never retiring it's never it's 437 00:23:32,440 --> 00:23:34,960 Speaker 6: gonna be from your witness. I'm gonna be a My 438 00:23:35,000 --> 00:23:37,040 Speaker 6: last job is gonna be a greeter at Walmart. I 439 00:23:37,080 --> 00:23:38,320 Speaker 6: got a kid, not. 440 00:23:38,280 --> 00:23:43,000 Speaker 3: Kidd, very good. Okay, this next one, now this is 441 00:23:43,040 --> 00:23:45,439 Speaker 3: the team crazy. Now your daughter's almost a team David. So, 442 00:23:45,440 --> 00:23:47,200 Speaker 3: I don't know if you've heard of this crave it's 443 00:23:47,240 --> 00:23:50,560 Speaker 3: six seven. And what happens when you say six seventy? 444 00:23:50,640 --> 00:23:51,200 Speaker 3: They repeat it? 445 00:23:51,240 --> 00:23:52,800 Speaker 5: And it's less my daughter and more of my sons 446 00:23:52,840 --> 00:23:55,720 Speaker 5: who were younger than she, but they go six seven. 447 00:23:55,840 --> 00:23:57,760 Speaker 5: I mean, it's like a weird I'm doing that. 448 00:23:57,760 --> 00:23:58,959 Speaker 6: And they juggle like the hand. 449 00:23:59,080 --> 00:24:00,840 Speaker 5: I don't get it, but I think I've been told 450 00:24:00,840 --> 00:24:02,320 Speaker 5: the point is I'm not supposed to get it. 451 00:24:02,480 --> 00:24:04,680 Speaker 3: Yes, you're not because you're not the cool one. Okay, 452 00:24:04,680 --> 00:24:06,919 Speaker 3: you can't say the cool one. But here's the problem. 453 00:24:07,000 --> 00:24:09,520 Speaker 3: So it sparked a social media thing right in the spring, 454 00:24:09,560 --> 00:24:11,600 Speaker 3: but now the kids are back in school, so it's 455 00:24:11,600 --> 00:24:15,040 Speaker 3: becoming this uproar in schools, especially for math teachers who 456 00:24:15,119 --> 00:24:18,200 Speaker 3: have to say sixcess all the time and the kids 457 00:24:18,280 --> 00:24:21,000 Speaker 3: just screaming a six seven. And so this is a 458 00:24:21,119 --> 00:24:25,399 Speaker 3: viral thing, a viral thing where it actually came from. Okay, 459 00:24:25,400 --> 00:24:27,080 Speaker 3: so I'll trace you back to last year. 460 00:24:27,119 --> 00:24:28,239 Speaker 7: There's a rap you can use. 461 00:24:28,320 --> 00:24:30,640 Speaker 5: I feel like every adult, every parent, because I. 462 00:24:30,600 --> 00:24:32,320 Speaker 3: Was wondering too, I was like, where does this come from? 463 00:24:32,480 --> 00:24:34,159 Speaker 3: There's a rapper called Scrilla. 464 00:24:34,240 --> 00:24:34,560 Speaker 6: Okay. 465 00:24:34,600 --> 00:24:38,159 Speaker 3: His song is called Dute Dute. Okay, I sound really Uncola. 466 00:24:38,480 --> 00:24:39,399 Speaker 5: You're familiar with this. 467 00:24:40,040 --> 00:24:42,800 Speaker 3: It includes a frame so he says six seven in 468 00:24:42,840 --> 00:24:45,800 Speaker 3: it because it's a reference to sixty seventh Street in Philly, 469 00:24:45,840 --> 00:24:47,600 Speaker 3: where you know a lot of his friends grew up. 470 00:24:47,640 --> 00:24:50,240 Speaker 3: So that's kind of how it originated. It sparked into 471 00:24:50,280 --> 00:24:53,560 Speaker 3: all these different ways. But how teachers are dealing with it. 472 00:24:53,640 --> 00:24:56,240 Speaker 3: What they're trying to do is they're starting to say 473 00:24:56,240 --> 00:24:58,600 Speaker 3: it and do it too. So maybe yes, so maybe 474 00:24:58,640 --> 00:25:00,560 Speaker 3: the kids will be like, well, that's not fun anymore. 475 00:25:02,520 --> 00:25:03,520 Speaker 5: I thought you were going to say. They're having like 476 00:25:03,560 --> 00:25:06,720 Speaker 5: rewrite the math problems, no right answer, But. 477 00:25:06,680 --> 00:25:09,320 Speaker 3: The teachers are like finding all these fun ways to 478 00:25:09,320 --> 00:25:11,840 Speaker 3: do it, Like they're asking chat GPT, like give me 479 00:25:12,480 --> 00:25:15,000 Speaker 3: an exam that has all answers of six to seven, 480 00:25:15,040 --> 00:25:19,240 Speaker 3: and they're trying to have fun with them punishment. It's 481 00:25:19,280 --> 00:25:21,080 Speaker 3: a tough crowd for them. They're having a rough time 482 00:25:21,080 --> 00:25:21,560 Speaker 3: with it all. 483 00:25:21,600 --> 00:25:23,520 Speaker 6: Right, there you go. There, that's what you wanted. 484 00:25:23,560 --> 00:25:26,520 Speaker 5: The newspapers would lease single best idea that feels like, 485 00:25:27,240 --> 00:25:28,560 Speaker 5: I think with Tom out we can do. 486 00:25:28,520 --> 00:25:29,400 Speaker 6: That exactly right. 487 00:25:29,440 --> 00:25:31,400 Speaker 2: So I these seems to come out of nowhere, But 488 00:25:31,760 --> 00:25:32,880 Speaker 2: you know, how long did they last? 489 00:25:32,880 --> 00:25:34,520 Speaker 6: And all that kind of stuff. We'll have to see. 490 00:25:34,600 --> 00:25:39,439 Speaker 1: This is the Bloomberg Surveillance Podcast, available on Apple, Spotify, 491 00:25:39,560 --> 00:25:41,800 Speaker 1: and anywhere else you get your podcasts. 492 00:25:42,320 --> 00:25:43,600 Speaker 9: Listen live each. 493 00:25:43,359 --> 00:25:47,200 Speaker 1: Weekday, seven to ten am Eastern on Bloomberg dot com, 494 00:25:47,359 --> 00:25:51,160 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 495 00:25:51,440 --> 00:25:54,560 Speaker 1: You can also watch us live every weekday on YouTube 496 00:25:54,880 --> 00:25:56,880 Speaker 1: and always on the Bloomberg terminal. 497 00:26:00,920 --> 00:26:02,240 Speaker 3: Everything had a st