WEBVTT - Surveillance: Vaccine Rollout With Yale's Forman 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 --> 0:00:27.240 Bloomberg dot Com, and of course, on the Bloomberg Let's 0:00:27.280 --> 0:00:29.720 kick off the conversation this morning with Michael Shall, market 0:00:29.720 --> 0:00:34.040 Field Asset Management CEO and portfolio manager. Good morning to Michael. 0:00:34.159 --> 0:00:36.240 Better news on a vaccine front over the last month 0:00:36.280 --> 0:00:39.680 looking at one. Is there anything between now and year 0:00:39.840 --> 0:00:43.599 end that could derail the optimism around a better outlook? Um, 0:00:43.800 --> 0:00:46.400 I don't think so, if I I hope not. You know, 0:00:46.479 --> 0:00:49.320 Having said that, I will say that markets are quite 0:00:49.320 --> 0:00:51.920 stretched at the end of November. Um, you know, particularly 0:00:51.960 --> 0:00:54.200 you know the cyclical trade, which which we've favored for 0:00:54.240 --> 0:00:56.320 several months. Um, you know, it's had it's had a 0:00:56.320 --> 0:00:59.840 hell of a move. Um. Yeah, I've seen plenty of 0:00:59.880 --> 0:01:01.720 the members which have a tricky couple of weeks in 0:01:01.760 --> 0:01:03.320 the middle of them, and you know that wouldn't be 0:01:03.320 --> 0:01:06.840 a surprise. But you know, I think generally, Um, you 0:01:06.880 --> 0:01:09.319 know what I was personal, as we doable goods economy 0:01:09.400 --> 0:01:12.760 is really following on all cylinders at this point in time. 0:01:13.560 --> 0:01:15.679 I think a vaccine would be helpful to that, but 0:01:15.880 --> 0:01:19.039 I don't even think it's necessary. We've had such a 0:01:19.080 --> 0:01:22.560 massive month through November for international equities, the best month 0:01:22.640 --> 0:01:24.600 ever on a stock six underd I think, the best 0:01:24.600 --> 0:01:26.800 month on an ECO for in Japan since the middle 0:01:26.800 --> 0:01:29.360 of the nineteen nineties. This came from JP Morgan this morning. 0:01:29.400 --> 0:01:33.240 We upgrade Eurozone to overweight, reduce the United States to neutral. 0:01:33.319 --> 0:01:36.280 Relative earnings trends have favored US over Europe for a 0:01:36.280 --> 0:01:38.880 while now, but a potential bass in relative earnings of 0:01:38.920 --> 0:01:41.640 the Eurozone could be on the cards. Michael, that's just 0:01:41.680 --> 0:01:44.320 an echo, a flavor of what we've heard so much 0:01:44.360 --> 0:01:47.039 over the last several weeks around the international stories. It's 0:01:47.040 --> 0:01:50.000 something you buy into. Two Well, you know, I think 0:01:50.000 --> 0:01:53.760 analysis does unfortunately often follow performance, So I think people 0:01:53.840 --> 0:01:56.200 under tremendous persons have changed their views. But you know, 0:01:56.240 --> 0:01:58.320 the point I made a couple of months ago was 0:01:58.960 --> 0:02:01.600 literally so much market cap trapped in the stuff that 0:02:01.720 --> 0:02:04.800 had been working, US technology as a sort of shorthand 0:02:04.800 --> 0:02:08.519 to that, but that any kind of reallocation away from 0:02:08.520 --> 0:02:10.960 that towards almost anything else is going to have an 0:02:11.000 --> 0:02:14.920 explosive impact. You know, we we would favor Japan over 0:02:14.960 --> 0:02:17.440 the ewer zone. You know, I like what's in the 0:02:17.520 --> 0:02:19.800 nick A. I like that part of the world in 0:02:19.960 --> 0:02:22.280 you know, in general. But I you know, but I 0:02:22.320 --> 0:02:25.399 think that that you know, you've had four or five 0:02:25.520 --> 0:02:29.000 years of tremendous out performance by by U S tech 0:02:29.040 --> 0:02:32.760 against global equities. UM, and I think you've unlocked a 0:02:32.760 --> 0:02:34.920 little bit of a rebound now. You know. The tricky 0:02:34.960 --> 0:02:37.760 thing going forward is that if this is a true 0:02:37.760 --> 0:02:39.480 turning point, and the sort of turning point you look 0:02:39.520 --> 0:02:42.120 back in five years time and say, wow, that really 0:02:42.240 --> 0:02:45.600 was something that normally implies a problem in the stuff 0:02:45.600 --> 0:02:48.320 that had been working. UM. You know, certainly that was 0:02:48.360 --> 0:02:50.400 the case at the end of the late nineties, certainly 0:02:50.440 --> 0:02:53.680 the case when he M you know, finished out performing 0:02:53.720 --> 0:02:56.440 in say two thousand and eleven. And so I think 0:02:56.440 --> 0:02:59.440 the tricky thing not not obviously for December twenty twenty, 0:02:59.520 --> 0:03:05.080 but maybe one is you know, if this out performance continues, 0:03:05.200 --> 0:03:08.280 does that involve US tech or the popular portions of 0:03:08.320 --> 0:03:11.040 the US equity market actually going down. There's also a 0:03:11.120 --> 0:03:16.040 question of whether the pandemic still matters, does it? It 0:03:16.080 --> 0:03:19.880 depends what you are that matters tremendously. I think for 0:03:19.880 --> 0:03:24.760 for urban service economies, it doesn't matter a great deal. Um. 0:03:24.840 --> 0:03:27.280 It may even be having a sort of strange beneficial 0:03:27.320 --> 0:03:31.920 effect um for the doable goods economy. Uh. And again 0:03:32.080 --> 0:03:35.120 I think, you know, a slightly different question would be, 0:03:35.440 --> 0:03:38.880 if we do have a successful vaccine and we sort 0:03:38.880 --> 0:03:41.800 of arrived in the summer of one in a in 0:03:41.840 --> 0:03:45.160 a better place medically and socially, thankfully, you know, does 0:03:45.240 --> 0:03:47.640 that come at the expense of the doable goods economy 0:03:47.760 --> 0:03:49.440 or have we just really, you know, have we just 0:03:49.680 --> 0:03:53.440 ignited a self self perpetuating cycle in that part of 0:03:53.440 --> 0:03:56.000 the global economy. At what point do you take a 0:03:56.000 --> 0:03:58.840 message from the bond market that really hasn't participated in 0:03:58.880 --> 0:04:01.839 the rally, the idea the treasury yields have remained so 0:04:01.920 --> 0:04:07.560 suppressed despite the optimism that we've seen everywhere else. You know, 0:04:07.560 --> 0:04:09.960 I think I take a partial message from that, you know, 0:04:10.240 --> 0:04:12.800 I think I do think sped guidance has something to play, 0:04:12.800 --> 0:04:15.040 and I do also think that the fixed income is 0:04:15.040 --> 0:04:17.560 something of a relative value play. But but it's difficult 0:04:17.560 --> 0:04:19.440 for US yields to be much higher than they are 0:04:19.480 --> 0:04:22.720 given where global yields are. But you know, I do 0:04:22.839 --> 0:04:27.120 think that if, if, if these sort of cyclical forces 0:04:27.200 --> 0:04:30.720 do continue, you will have higher U S treasury yields 0:04:30.720 --> 0:04:32.800 to the US tenure will find its way tot once 0:04:32.839 --> 0:04:35.200 fifty or one seventy five at some point next year, 0:04:35.600 --> 0:04:38.360 which you know would hardly be a shocking level. Historically 0:04:39.480 --> 0:04:41.599 wicked dollar started to come through Euro dollar right now. 0:04:42.880 --> 0:04:44.360 Six The line of the stand for so many of 0:04:44.400 --> 0:04:46.160 you at home, I know is one twenty, the high 0:04:46.200 --> 0:04:49.800 after yearn that was the start of September. We know 0:04:49.839 --> 0:04:51.240 that's the line of the stand for the e CP 0:04:51.400 --> 0:04:54.320 because whenever we got to euro dollar one twenty, Mr 0:04:54.320 --> 0:04:56.960 Philip Lane came out and battled it back down again. 0:04:56.960 --> 0:04:58.839 Michael Schaller, let's leave it there, shall we. Just a 0:04:58.880 --> 0:05:01.000 word on the U S order if you can. The 0:05:01.040 --> 0:05:03.360 calls are lining up. It's consensus for you for twenty 0:05:03.360 --> 0:05:05.560 one a week a dollar. Is that the side of 0:05:05.560 --> 0:05:09.359 the trade you're onto? Yeah, I think I think we 0:05:09.440 --> 0:05:12.279 cow against the sixthly sensitive currencies, So I think some 0:05:12.360 --> 0:05:14.400 of the e m courncies can gain a lot against. 0:05:14.839 --> 0:05:17.120 Michael Show of market Field, great to catch how your 0:05:17.120 --> 0:05:20.440 Michael Michael Scharltt Marketfield asked management the CEO and portfolio 0:05:20.520 --> 0:05:26.240 manager listen. So you Ki joined us NOW Banks for 0:05:26.240 --> 0:05:29.520 America Security Senior Hardline to reach out analysts. It's always 0:05:29.560 --> 0:05:31.480 great to get you on the show. Are we shopping 0:05:31.560 --> 0:05:34.600 less or just shopping somewhere else? Liz Well, I think 0:05:34.720 --> 0:05:38.000 where people are shopping has certainly changed. There's been this 0:05:38.360 --> 0:05:40.840 shift to online, and I think some of that has 0:05:40.880 --> 0:05:44.080 been intentional on the part of the retailers. What we've 0:05:44.120 --> 0:05:47.920 seen this holiday season especially is the early start to 0:05:48.200 --> 0:05:51.560 promotional activity, which began, you know, Black Friday sales began. 0:05:51.600 --> 0:05:54.160 It's early, it's November one for a lot of retailers, 0:05:54.600 --> 0:05:57.520 and and the shift has been to promote these you know, 0:05:57.600 --> 0:06:00.760 the online channels, partly for health and safety reasons, to 0:06:01.000 --> 0:06:04.040 you know, to avoid overcrowding in the stores, uh, you know, 0:06:04.120 --> 0:06:07.839 but also because the retailers have been seeing demand moving 0:06:07.880 --> 0:06:09.960 that direction and so they're you know, they're not trying 0:06:10.000 --> 0:06:13.080 to fight against it. So what we've seen a lot 0:06:13.160 --> 0:06:16.240 of this holiday season, in particular, which was relatively new, 0:06:16.720 --> 0:06:20.520 was the move towards um promoting curbside pickup and buy 0:06:20.600 --> 0:06:24.080 online pickup in store, which you know, which which has 0:06:24.680 --> 0:06:27.560 is beneficial to the consumer because they get the products 0:06:27.600 --> 0:06:29.520 sooner than they would if they went for the ship 0:06:29.680 --> 0:06:32.679 to home option. And it's beneficial for the retailer because 0:06:32.760 --> 0:06:36.800 they avoid having to spend the cost of shipping that 0:06:36.920 --> 0:06:38.680 product to the consumer. So it's kind of it's a 0:06:38.720 --> 0:06:41.640 win win situation. But you know, in general, we have 0:06:42.320 --> 0:06:45.560 we've seen a shift in spending also, I mean this 0:06:45.720 --> 0:06:50.120 is broader, longer term, which has been towards home categories, 0:06:50.320 --> 0:06:53.159 away from things like you know, travel and restaurants obviously 0:06:53.200 --> 0:06:55.960 an entertainment and so those dollars have been shifted into 0:06:56.000 --> 0:06:58.440 the home and so we we think that this holiday 0:06:58.480 --> 0:07:00.720 season is really going to be about uh, you know 0:07:00.800 --> 0:07:05.200 these home categories, comfort, yeah, end and and all of that. 0:07:06.400 --> 0:07:08.440 At least that takes us to home Depot, which has 0:07:08.480 --> 0:07:13.440 had a fantastic year through for many people. The vaccine 0:07:13.480 --> 0:07:16.360 is kryptonite for big tech. I wonder what it means 0:07:16.440 --> 0:07:19.120 for the shopping trends that have really been reinforced through 0:07:19.200 --> 0:07:21.360 much of looking ahead to twenty one. What are your 0:07:21.400 --> 0:07:24.000 thoughts on that at the moment? Is sure? I mean 0:07:24.080 --> 0:07:26.960 I think that for for home improvement retailers like like 0:07:27.080 --> 0:07:30.280 home Deboat lows, uh, there has been a big benefit 0:07:30.360 --> 0:07:33.000 this year from people staying at home and investing in 0:07:33.080 --> 0:07:36.320 their homes, making those upgrades, you know, putting doing the 0:07:36.360 --> 0:07:38.520 projects that they had put off for a while. But 0:07:38.720 --> 0:07:41.120 you know, as we look beyond this year and into 0:07:41.960 --> 0:07:44.480 one even post vaccine, you know, one of the big 0:07:44.560 --> 0:07:46.559 factors that we think is going to be a driver 0:07:46.800 --> 0:07:48.920 for next year is the fact that people have moved 0:07:49.480 --> 0:07:53.720 from urban markets into suburban markets. Housing metrics are you know, 0:07:53.880 --> 0:07:56.160 just on fire. And so what that means is there's 0:07:56.400 --> 0:08:00.160 this whole new slew of homeowners that become consumers and 0:08:00.240 --> 0:08:03.480 become home improvement customers for life essentially, So you know, 0:08:03.560 --> 0:08:05.560 for the next few years, that will continue to be 0:08:05.640 --> 0:08:08.680 a benefit. So even though these retailers are up against 0:08:08.760 --> 0:08:12.400 this difficult comparison in one, there are longer term tail 0:08:12.440 --> 0:08:14.240 winds that are still at play here, which are really 0:08:14.280 --> 0:08:17.320 those you know, those housing metrics that continue to trend positively. 0:08:17.560 --> 0:08:19.720 I do have to wonder, though, Liz, a lot of 0:08:19.760 --> 0:08:22.760 people have been home a lot. They can't go on vacation, 0:08:23.160 --> 0:08:25.920 so they're spending their money on the place where they stay. 0:08:26.200 --> 0:08:28.760 When they can go on vacation, when they can leave 0:08:28.800 --> 0:08:31.880 their homes, they will everyone who I've talked to, especially 0:08:31.880 --> 0:08:34.439 if they have small kids, wants to get out. So, 0:08:34.520 --> 0:08:37.199 in other words, how does that challenge the thesis that 0:08:37.280 --> 0:08:40.079 you just presented. Sure, yeah, I mean I think that 0:08:40.200 --> 0:08:43.679 there there will be eventually a return or maybe some 0:08:43.840 --> 0:08:46.240 you know, there's pent up demand for you know, for 0:08:46.320 --> 0:08:48.520 getting out of the house, and so at some point 0:08:48.559 --> 0:08:50.360 people will go back to travel. I think it will 0:08:50.440 --> 0:08:53.400 take time, though, because comfort won't be you know, immediate 0:08:53.559 --> 0:08:55.959 once there's a vaccine. It's going to take uh, you know, 0:08:56.120 --> 0:09:00.080 several months or quarters until people really feel comfortable traveling 0:09:00.120 --> 0:09:02.760 as they normally would. So for you know, for at 0:09:02.800 --> 0:09:06.080 least the next probably the majority of one, there's still 0:09:06.120 --> 0:09:10.199 gonna be this uh you know, this continued time spent 0:09:10.320 --> 0:09:12.880 in the home and focus on the home. But you know, 0:09:13.040 --> 0:09:15.839 after that, yeah, there there is probably going to be 0:09:16.040 --> 0:09:19.839 some period of payback or certainly a deceleration. You know. 0:09:19.920 --> 0:09:23.120 The speed of that deceleration will really be contingent upon 0:09:23.280 --> 0:09:26.959 the speed at which vaccines are distributed widely. Um, you know, 0:09:27.040 --> 0:09:30.000 so I think that there is uh, there's there's risk 0:09:30.160 --> 0:09:32.640 that growth will decelerate. I don't think it's possible for 0:09:32.920 --> 0:09:37.120 improvement spending to continue at this plus thirty percent, you're 0:09:37.160 --> 0:09:39.400 over your growth base. But I also don't think that 0:09:39.520 --> 0:09:41.920 that's what's priced into the stocks. I mean, right now, 0:09:42.080 --> 0:09:45.880 these stocks are trading at pretty modest multiples relative to 0:09:45.920 --> 0:09:48.959 their historical rates, So they're not trading at companies that 0:09:49.160 --> 0:09:53.559 will continue to to put up percent growth. You're year. 0:09:54.520 --> 0:09:56.280 Let's before we let you go. We talked a lot 0:09:56.320 --> 0:09:59.720 about companies retail. Let's pushing people to go to e commas. 0:10:00.160 --> 0:10:01.839 Can you walk me through where the bed, Bath and 0:10:01.880 --> 0:10:04.439 beyond have actually sorted out things in store for when 0:10:04.520 --> 0:10:09.400 things finally reopened properly get a better experience. It's overwhelming 0:10:09.520 --> 0:10:13.079 in there, there's too much stuff. They're doing something about it. 0:10:13.640 --> 0:10:16.199 I agree, yeah, And so they're they're new. The new 0:10:16.280 --> 0:10:19.800 CEO or relatively new CEO is the chief merchant a target, 0:10:19.920 --> 0:10:22.439 and so you know, the experience that he brings to 0:10:22.559 --> 0:10:25.920 that role is certainly what the company needed. And I 0:10:26.040 --> 0:10:29.520 think you're right, like the Florida ceiling stuff your pillows 0:10:29.520 --> 0:10:31.959 that you can't even reach up on the highest possible shelves, 0:10:32.040 --> 0:10:34.760 it's overwhelming, all right. So I think that they're changing 0:10:34.800 --> 0:10:37.120 the merchandizing in a pretty big way. And that's going 0:10:37.160 --> 0:10:39.720 to be a really big part of the turnaround story. 0:10:39.840 --> 0:10:41.920 There Lets it's great to catch up. Good to see 0:10:41.920 --> 0:10:48.320 you listen Oki there a Bank for America Securities makes 0:10:48.360 --> 0:10:50.480 I said that joining us now is John Riding Bring Capital, 0:10:50.600 --> 0:10:53.160 Chief Economic Advisor. John, great to get you back on 0:10:53.200 --> 0:10:56.680 the program sir as always good friend of Bloomberg Surveillance 0:10:56.720 --> 0:10:59.559 over the years. John, the near term risk, I want 0:10:59.559 --> 0:11:01.640 to start. They're a lot of people factor in this 0:11:01.720 --> 0:11:05.679 brighter forward outlook and the emphasizing the near term substantially 0:11:05.720 --> 0:11:08.360 so over the last couple of weeks, John, how much 0:11:08.400 --> 0:11:10.679 gap damage can we do to the outlook over the 0:11:10.760 --> 0:11:14.480 next couple of months, Well, we could do quite a 0:11:14.559 --> 0:11:17.800 bit of damage. The key thing here is that the 0:11:17.920 --> 0:11:21.360 income support for the ten million people are so who 0:11:21.440 --> 0:11:27.160 have lost their jobs since February aventually effectively evaporates mid 0:11:27.240 --> 0:11:30.840 to late December. It's either six months plus the thirteen 0:11:30.920 --> 0:11:33.520 weeks from when they lost their job, or at the 0:11:33.920 --> 0:11:37.320 end of the year, the thirteen week extension program under 0:11:37.360 --> 0:11:41.000 the Cares Act disappears. And that is about thirty billion 0:11:41.240 --> 0:11:45.679 dollars a month of household income and from the macro 0:11:45.880 --> 0:11:49.520 economy perspective, that's not a huge number because of the 0:11:49.559 --> 0:11:55.440 accumulated savings that has gone on through the pandemic period, 0:11:55.520 --> 0:11:58.840 the excess savings, which totals about one point five trillion, 0:11:59.160 --> 0:12:01.640 but those savings are not much of those savings are 0:12:01.640 --> 0:12:04.120 going to be in those distressed households. So those households 0:12:04.360 --> 0:12:06.400 are going to have to cut back on spending. They're 0:12:06.440 --> 0:12:09.959 going to be distressed, and and that is something that 0:12:10.120 --> 0:12:13.960 that could hit demand, not to think to the point 0:12:14.000 --> 0:12:17.360 where we see a negative growth print um, but could 0:12:17.400 --> 0:12:20.640 certainly yes slow growth considerably, which right now we think 0:12:20.679 --> 0:12:23.280 for the fourth quarter at least is looking about six 0:12:24.320 --> 0:12:27.760 real GDP growth. Let me also say, and what's very 0:12:27.800 --> 0:12:29.960 important is when we get a virus and we can 0:12:30.040 --> 0:12:33.240 get the four million people is so in the leisure, hospitality, 0:12:33.320 --> 0:12:37.520 travel industry who really can't return to work, and especially 0:12:37.640 --> 0:12:41.040 with the upswinging the virus infections that we sold through 0:12:41.040 --> 0:12:43.160 in November, those people are going to have to need 0:12:43.280 --> 0:12:46.600 businesses to go back to. So that's another area. How 0:12:46.720 --> 0:12:50.880 much damage can we have to the actual employers, to 0:12:50.920 --> 0:12:53.640 the small businesses that employ many of those people between 0:12:53.679 --> 0:12:57.959 now and then. So there is real hope over the 0:12:58.040 --> 0:13:01.679 horizon six months down road with the vaccines, but the 0:13:01.840 --> 0:13:06.240 next few months are going to be I think quite difficult. John. 0:13:06.240 --> 0:13:08.760 I'm so pleased you started with the disparity beneath the 0:13:08.800 --> 0:13:11.480 aggregate numbers, because the aggregate numbers get talked about way 0:13:11.520 --> 0:13:14.800 too much. A high savings rate. The savings are exactly 0:13:14.840 --> 0:13:16.240 where we don't want them to be there in the 0:13:16.280 --> 0:13:18.760 hands of the people with a lower marginal propensity to spend, 0:13:19.280 --> 0:13:21.600 and the people without the savings, and the people where 0:13:21.640 --> 0:13:23.360 we'd like to see the money as things open up, 0:13:23.400 --> 0:13:25.480 because they're likely the ones to go out there and 0:13:25.640 --> 0:13:28.959 spend it immediately. John. Going forward from here, I think 0:13:29.000 --> 0:13:32.160 if there's any complacency, it's because people have been experienced, 0:13:32.200 --> 0:13:34.559 been conditioned by the experience of the last few months 0:13:35.000 --> 0:13:37.480 where we snap back so quickly, and the recovery in 0:13:37.520 --> 0:13:40.920 America was much much better, bigger and better than I expected, 0:13:40.960 --> 0:13:43.240 and many others to John. And it's a belief that 0:13:43.280 --> 0:13:44.960 if we go into a small down term will come 0:13:44.960 --> 0:13:46.959 out of it the other side just as fast. Is 0:13:46.960 --> 0:13:50.520 there any reasons to believe that wouldn't happen, John, Well, 0:13:50.720 --> 0:13:53.839 as I said, it really matters about either business is 0:13:53.920 --> 0:13:56.719 going to be there to re employ people. So we 0:13:56.840 --> 0:13:59.920 do have a very difficult period markets where we need 0:14:00.040 --> 0:14:05.760 to work things out. For example, commercial rents are what's 0:14:05.760 --> 0:14:07.800 going to happen. There was a report out from the 0:14:07.800 --> 0:14:10.480 New York City Hospitality Alliance a few weeks ago that 0:14:10.520 --> 0:14:15.719 said eight percent of renters commercial renters in New York 0:14:15.760 --> 0:14:20.280 City couldn't make full or whole payment of the rent 0:14:21.200 --> 0:14:24.160 or partial payment of the rent in October. So what's 0:14:24.160 --> 0:14:27.280 going to happen to those businesses is the accumulated rent 0:14:27.320 --> 0:14:30.400 bird and going to be a major obstacle for them reopening. 0:14:30.440 --> 0:14:32.560 Are they're going to throw in the towels sadly when 0:14:33.280 --> 0:14:36.920 the end is very much in sight. We don't know, 0:14:37.960 --> 0:14:41.160 but that's important. It's not just about demand. It's about 0:14:41.400 --> 0:14:45.520 businesses to employ those ten million people who will be 0:14:45.680 --> 0:14:48.280 ready and able to go back to work once the 0:14:48.440 --> 0:14:51.680 vaccine is available. John, As you talk, I think about 0:14:51.720 --> 0:14:54.000 what Katherine Man of City Group was saying last week, 0:14:54.080 --> 0:14:58.040 which is the economy that emerges from COVID will look 0:14:58.160 --> 0:15:01.160 very different, in part because the biggest companies have had 0:15:01.200 --> 0:15:03.880 the best chance of survival. Well, the smaller ones have 0:15:03.960 --> 0:15:06.520 gone out of business at a record pace, And I 0:15:06.680 --> 0:15:10.520 do wonder what is the long term structural economic damage 0:15:11.000 --> 0:15:14.240 of this entire swath of smaller companies that have gotten 0:15:14.280 --> 0:15:16.800 wiped out, given the fact that they account for so 0:15:17.040 --> 0:15:19.480 much of the hiring in the United States and elsewhere. 0:15:20.360 --> 0:15:22.920 But that's an absolutely great point least, because if you 0:15:23.000 --> 0:15:27.360 look at the US labor market, about half of people 0:15:27.440 --> 0:15:31.240 employed work for big businesses and the other half work 0:15:31.360 --> 0:15:35.440 for small businesses. So we can't have enough expansion in 0:15:35.640 --> 0:15:40.480 big business activity to employ those people. Small businesses really 0:15:40.560 --> 0:15:44.200 are a great part of the entrepreneurial side of the 0:15:44.320 --> 0:15:47.920 US economy, and I have no doubt that two, three 0:15:48.000 --> 0:15:50.200 or four years down the road, whatever the damage has 0:15:50.240 --> 0:15:53.880 done over the next few months, entrepreneurial America will come 0:15:54.000 --> 0:15:57.240 back and will come back strongly. But that's a very 0:15:57.360 --> 0:16:00.320 long time frame for someone who has lost their job 0:16:00.680 --> 0:16:05.280 and doesn't have that prospect of getting back to immediate employment. 0:16:05.360 --> 0:16:08.240 So yes, we do have a to use the rather 0:16:08.440 --> 0:16:12.800 overworked term of ideas from Charles Dickens, a tale of 0:16:13.080 --> 0:16:18.920 two economies. We do have the large, big tech, large 0:16:19.040 --> 0:16:23.840 cap economy that's adjusted well through this in terms of 0:16:24.000 --> 0:16:26.560 e commerce and some of the big names of gain business. 0:16:26.880 --> 0:16:29.400 And then on the other hand, you've got the small businesses, 0:16:30.040 --> 0:16:33.160 especially in restaurants, host in the hospitality industry, and some 0:16:33.240 --> 0:16:35.760 of the larger business in that area, like airlines, which 0:16:35.800 --> 0:16:39.120 are really really struggling. And I think that that's got 0:16:39.200 --> 0:16:42.360 to be a major priority. If we don't get something 0:16:42.440 --> 0:16:44.840 done in this lame duck session, and it's a very 0:16:44.960 --> 0:16:47.360 short lame duck session with an awful lot to do 0:16:47.520 --> 0:16:50.160 in it haven't been we would have a government shutdown 0:16:50.200 --> 0:16:52.000 in the midst of all of this. If we don't 0:16:52.040 --> 0:16:54.160 get that done. That has to be the numble one 0:16:54.280 --> 0:17:02.080 focused alongside virus vaccine distribution for the incoming administration. Hi, John, 0:17:02.200 --> 0:17:04.359 great to give you on the program. Stay well, I 0:17:04.400 --> 0:17:06.160 send my best of the family. Won't you jump riding 0:17:06.200 --> 0:17:11.920 the up bring capital? Thank you John, joining us down. 0:17:12.040 --> 0:17:14.560 We really want to take a look at this vaccine distribution, 0:17:14.600 --> 0:17:18.480 the moderna news really accelerating that timeframe, Operation Warp Speed 0:17:18.920 --> 0:17:22.480 taking a little bit more shape. Dr Howard Foreman joining 0:17:22.600 --> 0:17:26.639 Yale University, Professor of Public Health and Economics and Radiology. 0:17:26.760 --> 0:17:29.120 What else. Dr Foreman, thank you so much for being 0:17:29.359 --> 0:17:31.680 with us. I want to start with this Operation Warp 0:17:31.800 --> 0:17:35.200 Speed and where we are based on the application that 0:17:35.240 --> 0:17:38.440 we're expecting from moderna based on what the FDA has signaled. 0:17:38.840 --> 0:17:40.960 When do you think we will start to get a 0:17:41.080 --> 0:17:43.439 trickle turn into a flood where we get a real 0:17:43.560 --> 0:17:47.920 critical mass of people in the United States being inoculated. Look, 0:17:48.000 --> 0:17:50.720 I'm one of the more optimistic people who believe that 0:17:50.800 --> 0:17:54.680 we're going to see tens of millions of doses starting 0:17:54.840 --> 0:18:00.240 to be used in January. February will obviously see something 0:18:00.280 --> 0:18:03.760 at the end of this month, probably at least, you know, 0:18:04.480 --> 0:18:07.320 several million, But we're gonna see tens of millions starting 0:18:07.400 --> 0:18:11.040 off in January. Uh, And it is not inconceivable that 0:18:11.200 --> 0:18:15.320 will have more doses than demand by the time we 0:18:15.440 --> 0:18:17.760 get this summer, and that would be a sort of 0:18:17.840 --> 0:18:19.560 good thing, But then we have to work on the 0:18:19.600 --> 0:18:22.600 whole issue of vaccine hesitancy. All right, let's let's tease 0:18:22.640 --> 0:18:25.679 out some of this aside from the demand side, when 0:18:25.760 --> 0:18:28.600 you talk about the supply coming on. Joshua Sharfstein was 0:18:28.760 --> 0:18:31.200 on earlier this morning, and he was saying he's concerned 0:18:31.240 --> 0:18:34.520 about the number of individuals out there, the infrastructure to 0:18:34.600 --> 0:18:38.400 deliver the inoculations in a timely manner. Is that something 0:18:38.440 --> 0:18:41.280 that concerns you as well, it's you know, we were 0:18:41.320 --> 0:18:45.119 all worried about that, but the first trench of vaccinations 0:18:45.320 --> 0:18:47.760 are sort of easier for us to do because they're 0:18:47.800 --> 0:18:50.720 going to be healthcare workers who work within healthcare systems 0:18:51.119 --> 0:18:54.800 that generally already have an infrastructure and apparatus in place, 0:18:55.200 --> 0:18:58.119 and they're going to hopefully be nursing homes. And for 0:18:58.320 --> 0:19:02.000 vulnerable individuals living in an institutions for which we also 0:19:02.160 --> 0:19:05.760 have an apparatus in place. It's the next step after 0:19:05.840 --> 0:19:07.960 that that we should all be most concerned about. But 0:19:07.960 --> 0:19:10.920 because we really want to get the vulnerable individuals in 0:19:10.960 --> 0:19:14.320 the community have suffered so much, the people of color, 0:19:14.800 --> 0:19:17.640 poor people, people that that have to risk their life 0:19:17.720 --> 0:19:21.480 every day as an essential worker, but not a healthcare worker, 0:19:21.560 --> 0:19:23.520 and how do we reach them. That's where it starts 0:19:23.560 --> 0:19:27.080 getting more challenging. Is the issue that people don't have 0:19:27.280 --> 0:19:30.520 confidence necessarily in a vaccine that's rushed out, or is 0:19:30.600 --> 0:19:34.280 the issue that there isn't the medical infrastructure built into 0:19:34.359 --> 0:19:37.399 some of those areas. This idea of people having a 0:19:37.480 --> 0:19:43.200 primary care physician or somebody that they regularly contact. Look, 0:19:43.240 --> 0:19:46.080 I think urban areas that have well developed public health 0:19:46.200 --> 0:19:48.640 infrastructure are going to be in a much better position 0:19:48.720 --> 0:19:50.840 to do this. And I think the fact that the 0:19:50.920 --> 0:19:54.119 federal government has already contracted with I believe CBS and 0:19:54.200 --> 0:19:58.480 Walgreens as part of the distribution plan abodes well for 0:19:58.600 --> 0:20:01.680 urban areas. I think getting out to rural areas. And then, 0:20:01.720 --> 0:20:04.600 as you point out, this issue of vaccine hesitancy should 0:20:04.680 --> 0:20:08.320 should concern everybody. We have witnessed over the last several months, 0:20:08.880 --> 0:20:12.160 um a schism in this country where some people are 0:20:12.280 --> 0:20:16.240 adherents of of good public health practices and some people 0:20:16.320 --> 0:20:20.280 think that it is a political statement to UM to 0:20:20.440 --> 0:20:22.920 basically give up on all those public health practices. We 0:20:23.040 --> 0:20:26.080 need everybody to want to get this vaccination. Well, how 0:20:26.160 --> 0:20:28.360 do you combat that? I mean, we've had anti vaxxers 0:20:28.440 --> 0:20:30.800 for years. I mean how do you combat that, especially 0:20:30.840 --> 0:20:33.040 at a time when there is the perception that this 0:20:33.160 --> 0:20:37.720 has been rushed through. So I think consistent messaging from 0:20:37.840 --> 0:20:41.119 leadership all the way on down. It has to be bipartisan. 0:20:41.560 --> 0:20:43.800 It has to come from the president, it has to 0:20:43.840 --> 0:20:46.159 come from the vice president, It has to come from 0:20:46.200 --> 0:20:48.679 all public health officials, it has to come from all 0:20:48.760 --> 0:20:51.880 state officials. Right now, we know that if we even 0:20:51.960 --> 0:20:55.680 look among red states, there are some red states where 0:20:55.680 --> 0:20:58.520 the messaging is excellent. There are some red states where 0:20:58.520 --> 0:21:01.680 the messaging is not excellent right now, Um, And so 0:21:02.240 --> 0:21:03.880 we've got to get over that. We've got to get 0:21:03.960 --> 0:21:06.720 past this sort of partisan divide in our country and 0:21:06.840 --> 0:21:09.800 get back to a point where everybody is basically messaging 0:21:09.920 --> 0:21:13.600 consistent evidence and fact and allowing the public to make 0:21:13.680 --> 0:21:16.480 a good decision, which in this case is about a 0:21:16.600 --> 0:21:20.240 vaccine that is highly highly effective and has very very 0:21:20.400 --> 0:21:25.480 low uh react to genicity or side effects. How politically 0:21:25.560 --> 0:21:28.760 fraught is it for big companies to get chunks of 0:21:28.880 --> 0:21:32.159 doses basically to distribute to their workforce that they can 0:21:32.200 --> 0:21:34.360