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 --> 00:00:22,000 Speaker 1: on Apple CarPlay or Android Auto with the Bloomberg Business App. 4 00:00:22,360 --> 00:00:25,680 Speaker 1: Listen on demand wherever you get your podcasts, or watch 5 00:00:25,760 --> 00:00:27,200 Speaker 1: us live on YouTube. 6 00:00:27,640 --> 00:00:31,200 Speaker 2: Julian Emmanuel With is chief equity quantitative strategist at Evercourt 7 00:00:31,520 --> 00:00:35,040 Speaker 2: Isi with an incredible note. I can't say enough about this. 8 00:00:35,280 --> 00:00:38,200 Speaker 2: I mean, is Stephen Fandozi doing all the work. He's 9 00:00:38,280 --> 00:00:42,800 Speaker 2: doing a lot of work. With the summary paragraph you have, 10 00:00:42,880 --> 00:00:46,400 Speaker 2: which is like ten sentences long, maybe eight sentences long, 11 00:00:46,640 --> 00:00:49,839 Speaker 2: how do you create the math? How do you collate 12 00:00:49,880 --> 00:00:53,840 Speaker 2: in your summary where earnings are modeling up fifteen point 13 00:00:53,920 --> 00:00:54,600 Speaker 2: six percent? 14 00:00:55,040 --> 00:01:00,520 Speaker 3: It's you know, really taking all the statistics and extraplating 15 00:01:00,760 --> 00:01:05,440 Speaker 3: the potential surprises and the beat percentages. I mean, there 16 00:01:05,520 --> 00:01:09,080 Speaker 3: is an enormous, as you know, amount of statistical work 17 00:01:09,120 --> 00:01:12,160 Speaker 3: that goes into it. But the bottom line is this 18 00:01:12,319 --> 00:01:14,480 Speaker 3: is another extraordinary earnings. 19 00:01:14,600 --> 00:01:16,760 Speaker 2: You even look like Bill Murray. It's ground on day 20 00:01:16,840 --> 00:01:19,600 Speaker 2: every ninety days. The world's coming to an end. Ball yep. 21 00:01:19,920 --> 00:01:22,640 Speaker 2: And then Julian goes, no, double digit, what a shock? 22 00:01:22,760 --> 00:01:24,560 Speaker 2: Double digit double digit Julian. 23 00:01:24,640 --> 00:01:26,200 Speaker 4: So what are you looking for in earnings? What do 24 00:01:26,200 --> 00:01:29,040 Speaker 4: you think the market's looking for in earnings this period? 25 00:01:29,560 --> 00:01:31,840 Speaker 5: So the issue with. 26 00:01:32,360 --> 00:01:35,640 Speaker 3: The start of this season is there was an expectation 27 00:01:36,080 --> 00:01:38,319 Speaker 3: that it was going to be as strong. It's actually 28 00:01:38,440 --> 00:01:43,360 Speaker 3: incrementally stronger than expected. But the reason the market hasn't gone, 29 00:01:43,480 --> 00:01:46,800 Speaker 3: you know, streaming through seven thousand on the S and P, 30 00:01:47,120 --> 00:01:50,280 Speaker 3: is that after the last several quarters where you had 31 00:01:50,360 --> 00:01:54,760 Speaker 3: surprises on the order of six percent or so above 32 00:01:54,840 --> 00:01:58,880 Speaker 3: the baseline expectation, getting you to that double digit number, 33 00:01:59,200 --> 00:02:02,440 Speaker 3: we thought it would happen again. It is happening again. 34 00:02:03,320 --> 00:02:07,880 Speaker 3: But the underlying messages it sets the table for twenty 35 00:02:07,920 --> 00:02:10,440 Speaker 3: twenty six very effectively, Julian. 36 00:02:10,560 --> 00:02:13,480 Speaker 4: Starting late October early November, we started to see a 37 00:02:13,480 --> 00:02:16,240 Speaker 4: little bit of a rotation in the market, you know, 38 00:02:16,280 --> 00:02:18,320 Speaker 4: maybe out of some of the tech names into some 39 00:02:18,360 --> 00:02:20,840 Speaker 4: of the more value maybe smaller mid cap. 40 00:02:21,880 --> 00:02:24,600 Speaker 5: Is that a longer term trend? Is that something we 41 00:02:24,639 --> 00:02:26,919 Speaker 5: should play in twenty six? How do you think about that? 42 00:02:27,000 --> 00:02:30,680 Speaker 3: Well, from our point of view, it actually started when 43 00:02:30,880 --> 00:02:35,320 Speaker 3: healthcare started to recoup the underperformance of the prior year, 44 00:02:35,560 --> 00:02:38,600 Speaker 3: when the government shut down the first time I've lost 45 00:02:38,600 --> 00:02:42,079 Speaker 3: track of the number. The government shuts down, and then 46 00:02:42,320 --> 00:02:45,160 Speaker 3: what you got toward the end of the year was 47 00:02:45,160 --> 00:02:49,760 Speaker 3: the start of the rotation away from technology because you 48 00:02:49,840 --> 00:02:53,880 Speaker 3: had some disappointment on earnings and you had concerns about debt, 49 00:02:54,160 --> 00:02:55,800 Speaker 3: and then to start January. 50 00:02:55,880 --> 00:02:57,440 Speaker 5: It's very typical for. 51 00:02:57,480 --> 00:03:01,160 Speaker 3: These areas to have performed the prior years laggers. In 52 00:03:01,240 --> 00:03:04,720 Speaker 3: our mind, it is one of those things that in 53 00:03:05,080 --> 00:03:09,079 Speaker 3: projecting seventy seven point fifty at year end twenty twenty 54 00:03:09,080 --> 00:03:12,200 Speaker 3: six on the S and B five oh NERD technology, 55 00:03:12,480 --> 00:03:15,800 Speaker 3: because of the waiting and the index, the math drives 56 00:03:15,840 --> 00:03:19,160 Speaker 3: the fact that it should and in our mind, there's 57 00:03:19,320 --> 00:03:22,400 Speaker 3: enough negative sentiment for the wall of worry to be 58 00:03:22,440 --> 00:03:24,880 Speaker 3: overcome that it will regain the leadership. 59 00:03:25,440 --> 00:03:28,720 Speaker 4: So for tech to regain that leadership, is that simply 60 00:03:28,760 --> 00:03:31,360 Speaker 4: a function. That's where the earnings are, that's where the 61 00:03:31,360 --> 00:03:32,240 Speaker 4: cash flow growth is. 62 00:03:33,040 --> 00:03:35,600 Speaker 3: Well, it's that, but if you look at the last 63 00:03:35,600 --> 00:03:39,600 Speaker 3: few weeks, it's also where the speculation has not been 64 00:03:39,720 --> 00:03:44,119 Speaker 3: okay okay. So in fact, the fact that it's come 65 00:03:44,160 --> 00:03:47,720 Speaker 3: off the boil in gold and silver is likely going 66 00:03:47,760 --> 00:03:49,680 Speaker 3: to be a tailwind for technology. 67 00:03:49,880 --> 00:03:52,280 Speaker 2: June Emmanuel Ever cry I sorry with this a lengthy 68 00:03:52,280 --> 00:03:55,560 Speaker 2: conversation to get a started run on YouTube. Subscribe to 69 00:03:55,600 --> 00:04:00,360 Speaker 2: Bloomberg podcasts on YouTube, growing each and every day. We 70 00:04:00,440 --> 00:04:03,680 Speaker 2: had some youngsters over, you know, the kids, had some 71 00:04:03,760 --> 00:04:06,800 Speaker 2: youngster they're so hip, and of course they don't they 72 00:04:06,800 --> 00:04:10,160 Speaker 2: don't do YouTube. Now they've spent the whole time talking 73 00:04:10,160 --> 00:04:14,040 Speaker 2: about Bruno Mars and the Grammys. But you know, on YouTube, 74 00:04:14,880 --> 00:04:18,200 Speaker 2: we're doing a digital distribution there. Tell me about revenues. 75 00:04:18,400 --> 00:04:20,520 Speaker 2: You know, I look at Pepsi. They're cutting prices on 76 00:04:20,960 --> 00:04:24,400 Speaker 2: Cheetos and and all that. There's a real battle here 77 00:04:24,880 --> 00:04:28,560 Speaker 2: to sustain a nominal GDP revenue stream are we. 78 00:04:30,120 --> 00:04:33,680 Speaker 3: It's actually stunning, quite frankly, that revenue looks like it's 79 00:04:33,720 --> 00:04:36,839 Speaker 3: going to come in north of seven percent growth. 80 00:04:36,720 --> 00:04:38,400 Speaker 2: Blended five hundred. 81 00:04:38,760 --> 00:04:42,039 Speaker 3: I mean, it's you and I have never said that now, yeah, 82 00:04:42,160 --> 00:04:45,960 Speaker 3: and and and and it is really points to the 83 00:04:46,160 --> 00:04:51,600 Speaker 3: extraordinary resilience of the economy. And and and frankly, again, 84 00:04:52,279 --> 00:04:57,560 Speaker 3: this idea that as as uncomfortable as it is when 85 00:04:57,600 --> 00:05:01,480 Speaker 3: we see this affordability issue, the fact is is that 86 00:05:01,640 --> 00:05:05,880 Speaker 3: for now, and this is changing at the margin because 87 00:05:05,880 --> 00:05:08,680 Speaker 3: of this kind of commentary, is that as long as 88 00:05:08,720 --> 00:05:12,520 Speaker 3: the employment picture is as strong as it is, revenue 89 00:05:12,600 --> 00:05:15,160 Speaker 3: can continue to be as strong as it is. 90 00:05:15,240 --> 00:05:17,560 Speaker 2: What do you see about use of free cash flow? 91 00:05:17,600 --> 00:05:20,800 Speaker 2: I got a four percent dividend lifted PEPSI they announced it. 92 00:05:20,880 --> 00:05:24,560 Speaker 2: Not an Apple like share buyback, but nevertheless, are non 93 00:05:24,680 --> 00:05:28,200 Speaker 2: tech companies getting like Apple where they're trying to really 94 00:05:28,200 --> 00:05:29,680 Speaker 2: deploy cash to shareholders? 95 00:05:29,720 --> 00:05:29,760 Speaker 6: No? 96 00:05:29,880 --> 00:05:35,400 Speaker 3: That yeah, and that's that's an ongoing trend, but accelerating 97 00:05:35,600 --> 00:05:39,599 Speaker 3: again because when you look at twenty twenty six, what 98 00:05:39,680 --> 00:05:43,320 Speaker 3: you see is a macro backdrop where you're going to have, 99 00:05:43,520 --> 00:05:47,240 Speaker 3: you know, stimulus via the one big beautiful bill, You're 100 00:05:47,240 --> 00:05:51,799 Speaker 3: going to have stimulus via two maybe three FED rate cuts, 101 00:05:52,160 --> 00:05:55,320 Speaker 3: and so you really don't need to have the war 102 00:05:55,480 --> 00:05:59,359 Speaker 3: chest ready, as corporate America does from time to time 103 00:05:59,640 --> 00:06:01,880 Speaker 3: in n anticipation of a market slowdown. 104 00:06:02,400 --> 00:06:04,840 Speaker 4: Boy, Tom, I'm looking at another big tech naque Pollunteer 105 00:06:04,880 --> 00:06:08,920 Speaker 4: Technology forecast revenue for FISTOL twenty six that's expected to 106 00:06:08,960 --> 00:06:11,720 Speaker 4: grow sixty one percent this year. 107 00:06:11,760 --> 00:06:14,039 Speaker 5: Holy count. So it stocked up on. 108 00:06:15,720 --> 00:06:16,479 Speaker 3: The No. 109 00:06:17,279 --> 00:06:19,279 Speaker 2: I mean, I'm in the triple levers doll cash run, 110 00:06:19,320 --> 00:06:21,600 Speaker 2: so who cares? But I look at a folks, I'm 111 00:06:21,640 --> 00:06:23,160 Speaker 2: not going to mention the name of the company. But 112 00:06:23,160 --> 00:06:26,359 Speaker 2: I got a bell Weather toothpased company that I just 113 00:06:26,400 --> 00:06:29,359 Speaker 2: sort of use Paul. It's popped in like two weeks 114 00:06:29,680 --> 00:06:32,000 Speaker 2: up twenty percent a boring toothpaste. 115 00:06:32,279 --> 00:06:34,080 Speaker 5: Little rotation there, but because. 116 00:06:34,000 --> 00:06:37,120 Speaker 2: Yeah, rotation, and also I think used the cash. 117 00:06:36,920 --> 00:06:40,479 Speaker 4: Yep, Julian, we saw twenty twenty five US equity markets 118 00:06:40,480 --> 00:06:43,040 Speaker 4: did very, very well, but many markets outside of the 119 00:06:43,120 --> 00:06:45,800 Speaker 4: US did way better than the US. How do you 120 00:06:45,839 --> 00:06:47,720 Speaker 4: think about the US versus rest of the world from me? 121 00:06:47,839 --> 00:06:50,880 Speaker 3: So that actually goes back to Tom's last observation on 122 00:06:50,960 --> 00:06:54,200 Speaker 3: the toothpaste company. Part of that was the fact that 123 00:06:54,240 --> 00:06:57,279 Speaker 3: the US dollar has fallen as far as it has 124 00:06:57,279 --> 00:07:00,279 Speaker 3: over the last year, and that Paul has driven a 125 00:07:00,320 --> 00:07:03,080 Speaker 3: lot of this outperformance of the rest of the world. 126 00:07:03,279 --> 00:07:07,320 Speaker 3: You know, in our mind, the dollar did make a 127 00:07:07,480 --> 00:07:11,640 Speaker 3: significant multi year peak last year at about this time, 128 00:07:12,040 --> 00:07:15,280 Speaker 3: similar to you had a multi year dollar down trend 129 00:07:15,520 --> 00:07:18,040 Speaker 3: from two thousand and one to two thousand and seven. 130 00:07:18,240 --> 00:07:20,560 Speaker 3: And the bottom line there, and we think the bottom 131 00:07:20,600 --> 00:07:24,440 Speaker 3: line over the longer term here is that you saw 132 00:07:24,840 --> 00:07:29,960 Speaker 3: rest of world outperformance over that long period because of 133 00:07:30,000 --> 00:07:33,280 Speaker 3: the dollar weakness. Now, what we would say here is 134 00:07:33,320 --> 00:07:35,800 Speaker 3: that it is not likely that you're going to have 135 00:07:36,240 --> 00:07:40,240 Speaker 3: a dramatic rest of the world outperformance kick in until 136 00:07:40,320 --> 00:07:44,080 Speaker 3: the AI trade peaks. And you know, we believe the 137 00:07:44,160 --> 00:07:47,280 Speaker 3: AI trade has a lot further to run, not. 138 00:07:47,400 --> 00:07:49,520 Speaker 5: Just valuation in the market. How you frame that conversation 139 00:07:49,600 --> 00:07:52,880 Speaker 5: with your clients these days, Well, the last year has 140 00:07:52,920 --> 00:07:53,840 Speaker 5: been a transition. 141 00:07:54,520 --> 00:08:00,400 Speaker 3: Is that you know, most value oriented investors had to 142 00:08:00,440 --> 00:08:04,000 Speaker 3: make the leap of faith, as did we into this 143 00:08:04,200 --> 00:08:08,160 Speaker 3: idea that this is one of these times where valuations 144 00:08:08,480 --> 00:08:12,040 Speaker 3: are higher than normal due to the potential for this 145 00:08:12,240 --> 00:08:16,560 Speaker 3: productivity bump from AI and due to the fact that 146 00:08:16,560 --> 00:08:19,600 Speaker 3: there's just an enormous amount of liquidity in the system 147 00:08:19,720 --> 00:08:24,920 Speaker 3: right now, and so so you know, it's an put 148 00:08:24,960 --> 00:08:28,640 Speaker 3: it this way, if we get to a point where 149 00:08:28,680 --> 00:08:32,800 Speaker 3: people are no longer questioning valuations, that's when we're going 150 00:08:32,880 --> 00:08:35,600 Speaker 3: to start worrying. We hope that time doesn't happen. 151 00:08:36,520 --> 00:08:38,920 Speaker 4: What's screening well for you guys these days? Is it 152 00:08:38,960 --> 00:08:41,800 Speaker 4: a sector? Is it a factor out there? What's screening 153 00:08:41,840 --> 00:08:42,360 Speaker 4: well for you guys? 154 00:08:42,440 --> 00:08:46,160 Speaker 3: These says Well, interestingly, what we like is this concept 155 00:08:46,280 --> 00:08:50,400 Speaker 3: of low leverage. Okay, and normally you might think that 156 00:08:50,400 --> 00:08:56,120 Speaker 3: that would be something reasonably defensive in anticipation of a downturn. 157 00:08:56,360 --> 00:08:59,599 Speaker 3: But no, what it actually is is a manifestation of 158 00:09:00,080 --> 00:09:04,760 Speaker 3: rporate America's ability to generate free cash flow and in 159 00:09:04,840 --> 00:09:08,600 Speaker 3: fact lower leverage. Happens to be found in some of 160 00:09:08,600 --> 00:09:11,520 Speaker 3: the marquee names across technology. 161 00:09:11,600 --> 00:09:14,200 Speaker 2: For instance, how do you dovetail in Christian de Gua's work. 162 00:09:14,360 --> 00:09:17,560 Speaker 2: I mean, you know, he's acclaimed as a Fed watcher 163 00:09:17,600 --> 00:09:20,800 Speaker 2: and all that are you taking? Are you on an 164 00:09:20,800 --> 00:09:25,360 Speaker 2: Emmanuel worsh watch? Well, a worsh watch. 165 00:09:27,120 --> 00:09:32,160 Speaker 3: I think the concerns around the hawkishness are probably overdone. 166 00:09:32,840 --> 00:09:37,040 Speaker 3: If you think about Donald Trump's propensity to nominate an 167 00:09:37,080 --> 00:09:40,719 Speaker 3: overtly hawkish FED chair, it just doesn't make a ton 168 00:09:40,760 --> 00:09:46,080 Speaker 3: of sense. Christian's view is that this year is stronger, 169 00:09:46,400 --> 00:09:51,040 Speaker 3: not hotter, which actually will give the you know, the 170 00:09:51,080 --> 00:09:55,280 Speaker 3: Fed chair an ability to cut rates again, a boost 171 00:09:55,400 --> 00:09:57,320 Speaker 3: for the economy and markets. 172 00:09:57,400 --> 00:10:00,600 Speaker 2: Bring it down to basics, like people that that don't 173 00:10:00,640 --> 00:10:07,040 Speaker 2: read your fabulous earning summary your conviction to buy new 174 00:10:07,160 --> 00:10:11,160 Speaker 2: shares here? I get it if somebody's on board this bullmarket, 175 00:10:11,520 --> 00:10:14,160 Speaker 2: But do you have a conviction that you should acquire 176 00:10:14,760 --> 00:10:15,920 Speaker 2: shares here? 177 00:10:16,200 --> 00:10:19,040 Speaker 3: So this is how you think about bull market cycles. Okay, 178 00:10:19,440 --> 00:10:23,720 Speaker 3: and it makes sense when you think about the last 179 00:10:23,840 --> 00:10:27,920 Speaker 3: year in particular, lots and lots of macronoids, lots of 180 00:10:28,040 --> 00:10:31,679 Speaker 3: things to disrupt the narrative, scare people. At the end 181 00:10:31,679 --> 00:10:34,960 Speaker 3: of the day, earnings kept going. And the four things 182 00:10:35,400 --> 00:10:39,160 Speaker 3: that we think are hallmarks of the end of a 183 00:10:39,160 --> 00:10:43,360 Speaker 3: bullmarket a recession, a FED that's more likely to hike 184 00:10:43,480 --> 00:10:46,880 Speaker 3: than cut, longer term yields moving. 185 00:10:46,760 --> 00:10:48,280 Speaker 5: You know, dramatically higher. 186 00:10:48,480 --> 00:10:51,200 Speaker 3: By that we mean closer to five percent, and then 187 00:10:51,400 --> 00:10:56,599 Speaker 3: overt FOMO or you know, you know, incredible capital markets intensity. 188 00:10:57,080 --> 00:10:59,680 Speaker 3: None of those have been present, and so for us, 189 00:11:00,360 --> 00:11:03,040 Speaker 3: the recipe is the bull market has further to go, 190 00:11:04,000 --> 00:11:06,520 Speaker 3: and if you're under invested, you probably want to get 191 00:11:06,559 --> 00:11:10,120 Speaker 3: to where you feel like, you know, you're reasonably fully invested. 192 00:11:10,520 --> 00:11:12,400 Speaker 4: We haven't really talked about the FED here. We're gonna 193 00:11:12,400 --> 00:11:15,160 Speaker 4: get a new FED chairman. I guess we're getting rape cuts. 194 00:11:15,160 --> 00:11:18,040 Speaker 4: How do you factor in just the FED into your 195 00:11:18,240 --> 00:11:20,000 Speaker 4: equity kind of mosaic there. 196 00:11:20,160 --> 00:11:22,920 Speaker 3: Well, again, you go back to last week and and 197 00:11:23,160 --> 00:11:29,840 Speaker 3: that presser was fortunately happily non dramatic. 198 00:11:30,320 --> 00:11:32,480 Speaker 5: Okay, there's all this, you. 199 00:11:32,440 --> 00:11:35,280 Speaker 3: Know, back and forth in the background, and at the 200 00:11:35,400 --> 00:11:38,840 Speaker 3: end of the day, the messages the economy is doing fine, 201 00:11:38,880 --> 00:11:41,640 Speaker 3: thank you very much, and that we will end up 202 00:11:41,760 --> 00:11:45,320 Speaker 3: being in a position where at some point in the 203 00:11:45,360 --> 00:11:49,080 Speaker 3: future we will be able to reduce rates and you know, 204 00:11:49,360 --> 00:11:52,320 Speaker 3: on a measured basis. Chilian Emmanuel, thank you so much. 205 00:11:52,360 --> 00:11:55,199 Speaker 2: Can't say enough about the It's not every day. It's 206 00:11:55,200 --> 00:11:57,160 Speaker 2: like every three days you put out you're earning song. 207 00:11:57,320 --> 00:11:59,240 Speaker 5: No, no, every day. 208 00:11:59,480 --> 00:12:02,320 Speaker 2: Every day your team is putting it out, not you. 209 00:12:03,120 --> 00:12:06,439 Speaker 3: Stephen Fandozi, Mike Chu and Barack Hurwitz. 210 00:12:06,960 --> 00:12:10,600 Speaker 2: Superstars there there. Jun Emmanuel, thank you so much. Evercore I, 211 00:12:10,600 --> 00:12:15,439 Speaker 2: I really appreciate it. Stay with us. More from Bloomberg 212 00:12:15,559 --> 00:12:17,600 Speaker 2: Surveillance coming up after this. 213 00:12:24,840 --> 00:12:28,440 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live 214 00:12:28,520 --> 00:12:31,640 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 215 00:12:31,760 --> 00:12:35,120 Speaker 1: Apple Karplay and Android Otto with the Bloomberg Business app, 216 00:12:35,320 --> 00:12:38,600 Speaker 1: or watch us live on YouTube's. 217 00:12:37,600 --> 00:12:40,839 Speaker 2: The great thing about billions or industry is there's always 218 00:12:40,880 --> 00:12:44,680 Speaker 2: a wacko economist who studied social studies at Harvard and 219 00:12:44,760 --> 00:12:49,920 Speaker 2: became actually hugely acclaimed in housing economics, and wandered over 220 00:12:49,960 --> 00:12:52,920 Speaker 2: to see Adam Posen at the Peterson Institute. That must 221 00:12:52,920 --> 00:12:56,200 Speaker 2: be Jed Coco with us right now. How in God's 222 00:12:56,280 --> 00:12:59,440 Speaker 2: name did you end up at the Peterson Institute? How 223 00:12:59,480 --> 00:13:00,280 Speaker 2: did that happen? 224 00:13:00,120 --> 00:13:02,520 Speaker 6: But it is where some of the most thoughtful and 225 00:13:02,679 --> 00:13:05,120 Speaker 6: natual economists are. It's a great place to be. It's 226 00:13:05,120 --> 00:13:07,600 Speaker 6: a fantastic community and Adams wonderful. Was it like a 227 00:13:07,600 --> 00:13:10,480 Speaker 6: one hand in the Washington Post or you know, well, 228 00:13:10,520 --> 00:13:12,480 Speaker 6: I used to be the chief economist, And indeed, so, 229 00:13:12,559 --> 00:13:14,440 Speaker 6: of course I have to tell you that, you know, 230 00:13:14,679 --> 00:13:19,600 Speaker 6: it's one of those jobs that happened outside of those postings. 231 00:13:19,600 --> 00:13:21,319 Speaker 2: But it's great to be there. A couple I got. 232 00:13:21,320 --> 00:13:23,800 Speaker 2: I asked one housing questionnaire before we get to your 233 00:13:23,840 --> 00:13:27,640 Speaker 2: important work with Peterson Institute. I'm the American labor disaster. 234 00:13:28,440 --> 00:13:33,319 Speaker 2: You own granular housing research. You did as far as 235 00:13:33,320 --> 00:13:37,240 Speaker 2: I'm concerned, you did it before anybody else. With all 236 00:13:37,280 --> 00:13:40,160 Speaker 2: the data we now have in the Internet about housing, 237 00:13:40,520 --> 00:13:44,199 Speaker 2: what's your summary of twelve months and five years forward 238 00:13:44,280 --> 00:13:45,920 Speaker 2: in residential housing. 239 00:13:46,640 --> 00:13:49,199 Speaker 6: So we are at a point where, of course rates 240 00:13:49,200 --> 00:13:53,880 Speaker 6: are still high. There is strong construction on the multifamily side, 241 00:13:54,120 --> 00:13:58,599 Speaker 6: but residential construction is where both tariffs and immigration. 242 00:13:58,640 --> 00:13:59,560 Speaker 2: Both pose a risk. 243 00:14:00,880 --> 00:14:06,520 Speaker 6: Those two big policy uncertainties are headwinds for residential construction. 244 00:14:06,760 --> 00:14:09,079 Speaker 6: And the good news is that prices are not rising 245 00:14:09,600 --> 00:14:12,320 Speaker 6: as fast as they were, so there might be some 246 00:14:12,800 --> 00:14:15,199 Speaker 6: easing of affordability concerns. But you know, we went from 247 00:14:15,200 --> 00:14:17,560 Speaker 6: a world back, you know, back when we talked in 248 00:14:17,559 --> 00:14:19,040 Speaker 6: the days that I was at truly I lived in 249 00:14:19,040 --> 00:14:21,960 Speaker 6: San Francisco, and everybody talked about housing affordability, but it 250 00:14:22,040 --> 00:14:24,400 Speaker 6: was thought of as mostly a local issue. Then a 251 00:14:24,400 --> 00:14:26,360 Speaker 6: few years ago, when I was at the Commerce Department 252 00:14:26,400 --> 00:14:29,880 Speaker 6: traveling around the country talking to mayor's economic developments around 253 00:14:29,880 --> 00:14:34,560 Speaker 6: the country, every place felt that housing affordability was one 254 00:14:34,600 --> 00:14:37,880 Speaker 6: of their biggest labor market challenges. Rapid City, South Dakota, Syracuse, 255 00:14:37,960 --> 00:14:40,200 Speaker 6: New York. I would go there ask what's holding back 256 00:14:40,240 --> 00:14:43,600 Speaker 6: economic development, and the answer was we don't have enough housing. 257 00:14:43,600 --> 00:14:46,400 Speaker 6: And I thought, really like, this is you know, I 258 00:14:46,440 --> 00:14:48,360 Speaker 6: think of this as a San Francisco in New York issue, 259 00:14:48,360 --> 00:14:52,680 Speaker 6: but it became a nationwide issue. Now as we're seeing 260 00:14:52,880 --> 00:14:56,480 Speaker 6: more construction, particularly the multifamily side, those price increases are 261 00:14:56,560 --> 00:15:01,080 Speaker 6: easing a teriffs and immigration both still our headwinds for construction. 262 00:15:01,200 --> 00:15:04,800 Speaker 2: Jeff Coco with US he invented the Internet study of 263 00:15:04,920 --> 00:15:08,520 Speaker 2: housing for US at truly years ago. Back then, Paul 264 00:15:08,600 --> 00:15:11,640 Speaker 2: he was in San Francisco in Avocado six days a week. 265 00:15:11,480 --> 00:15:12,800 Speaker 5: At Green's restaurant they did. 266 00:15:12,920 --> 00:15:17,840 Speaker 2: Now he's at the capitol of grill and pounded sakestpos. 267 00:15:16,480 --> 00:15:19,000 Speaker 5: The New York Strip jed talk to us about immigration. 268 00:15:19,080 --> 00:15:21,880 Speaker 4: One of the concerns when President Trump came to office 269 00:15:21,880 --> 00:15:25,360 Speaker 4: in a much stricter immigration policy was, aside from any 270 00:15:25,400 --> 00:15:28,080 Speaker 4: social issues, was the economic impact would be felt in 271 00:15:28,080 --> 00:15:31,160 Speaker 4: a number of areas, including supply of labor, which would 272 00:15:31,160 --> 00:15:35,920 Speaker 4: impact some really important industries like agricultural, like home building, 273 00:15:36,720 --> 00:15:37,720 Speaker 4: like the service sector. 274 00:15:38,520 --> 00:15:40,440 Speaker 5: I don't think we've seen that in the data, have we? 275 00:15:40,640 --> 00:15:42,920 Speaker 6: So we have seen that. Just start looking by the 276 00:15:43,160 --> 00:15:47,320 Speaker 6: monthly jobs numbers. Okay, that headline number that we all watch. 277 00:15:48,200 --> 00:15:50,480 Speaker 6: It used to be that we expected a break even 278 00:15:50,600 --> 00:15:52,320 Speaker 6: rate to get the lid market study of about one 279 00:15:52,400 --> 00:15:55,560 Speaker 6: hundred and seventy thousand jobs a month. Now that's something 280 00:15:55,720 --> 00:15:59,240 Speaker 6: under fifty thousand jobs of Okay, fifty today is a 281 00:15:59,280 --> 00:16:02,600 Speaker 6: reasonably good number, given how much more slowly the workforce 282 00:16:02,680 --> 00:16:05,520 Speaker 6: is growing. The main reason for that is the slow 283 00:16:05,560 --> 00:16:09,360 Speaker 6: down in immigration. Immigrants, of course, are disproportionately working age. 284 00:16:10,000 --> 00:16:12,320 Speaker 6: When we have a huge shift in immigration policy that 285 00:16:12,400 --> 00:16:16,360 Speaker 6: slows down the rate of immigration, the economy grows more slowly. 286 00:16:16,440 --> 00:16:20,280 Speaker 6: We're seeing that particularly in sectors that rely on immigrants 287 00:16:20,280 --> 00:16:24,840 Speaker 6: more than others. Construction, home, healthcare, food, manufacturing. You know, 288 00:16:24,920 --> 00:16:28,480 Speaker 6: these are all sectors that have not grown in terms 289 00:16:28,520 --> 00:16:30,760 Speaker 6: of their jobs, are even shrunk in the past year 290 00:16:31,480 --> 00:16:33,200 Speaker 6: under current immigration policy. 291 00:16:33,240 --> 00:16:36,840 Speaker 4: Feels underreported to me because quite frankly, I've been looking. 292 00:16:36,600 --> 00:16:38,640 Speaker 5: For that in the news slow and I see it. 293 00:16:38,680 --> 00:16:43,680 Speaker 4: I don't see the you know, the beef factory, you know, 294 00:16:43,800 --> 00:16:47,280 Speaker 4: slaughterhouse shutting down for Hormel or whomever. I don't see 295 00:16:47,320 --> 00:16:50,960 Speaker 4: these big companies saying we can't build the houses because 296 00:16:50,960 --> 00:16:53,440 Speaker 4: we don't have the workers. We can't pick the I 297 00:16:53,440 --> 00:16:56,280 Speaker 4: haven't seen the stories where fruits and vegetables are going 298 00:16:56,320 --> 00:16:58,600 Speaker 4: bad in California because nobody's there to pick them. 299 00:16:59,200 --> 00:17:01,640 Speaker 5: I just feel like it's not happening. 300 00:17:01,840 --> 00:17:05,080 Speaker 6: Yeah, So in the data, we see it as flat 301 00:17:05,240 --> 00:17:08,040 Speaker 6: or slow growth rather than faster growth. So it is 302 00:17:08,119 --> 00:17:12,400 Speaker 6: not a decline of ten or twenty percent in employment 303 00:17:12,400 --> 00:17:15,200 Speaker 6: in these sectors. It's not a huge drop in production, 304 00:17:15,920 --> 00:17:19,280 Speaker 6: but it means almost all the job growth has been 305 00:17:19,359 --> 00:17:23,120 Speaker 6: in sectors that don't particularly rely on immigrants in the workforce. 306 00:17:23,480 --> 00:17:26,920 Speaker 2: If we get to five percent unemployment, is it the same? 307 00:17:26,960 --> 00:17:28,720 Speaker 2: I mean Adam Post and I would know that in 308 00:17:28,760 --> 00:17:32,000 Speaker 2: August of sixty four, the Red Sox were in last place. 309 00:17:32,800 --> 00:17:36,679 Speaker 2: Is five percent unemployment now like five percent unemployment in 310 00:17:36,760 --> 00:17:38,639 Speaker 2: nineteen sixty four? I don't buy it. 311 00:17:39,280 --> 00:17:45,760 Speaker 6: So the biggest difference today with unemployment compared to sixties, nineties, 312 00:17:46,200 --> 00:17:50,720 Speaker 6: twenty tens is the relatively low unemployment rate is still 313 00:17:50,760 --> 00:17:53,160 Speaker 6: hand in hand with very low hiring. It's a very 314 00:17:53,200 --> 00:17:57,240 Speaker 6: low turn economy right now. The hiring rate is what 315 00:17:57,320 --> 00:18:00,600 Speaker 6: we typically see when unemployment is close to eight percent. 316 00:18:00,760 --> 00:18:02,280 Speaker 6: Of course, unemployment actually is it? 317 00:18:02,440 --> 00:18:05,919 Speaker 2: I want to say that again. Right now, the hiring. 318 00:18:05,600 --> 00:18:09,520 Speaker 6: Rate, the rate at which employers are bringing new people on, 319 00:18:10,119 --> 00:18:12,919 Speaker 6: is at the lowest level since twenty twelve, except for 320 00:18:12,920 --> 00:18:16,000 Speaker 6: a brief moment during the pandemic. That low level is 321 00:18:16,040 --> 00:18:19,399 Speaker 6: typically what we see when unemployment is at eight percent. 322 00:18:19,720 --> 00:18:22,639 Speaker 2: One hundred and four percent of our listeners agree with 323 00:18:22,760 --> 00:18:26,000 Speaker 2: what you just said. Do you sense any urgency at 324 00:18:26,040 --> 00:18:30,720 Speaker 2: the Peterson Institute for Washington with our moldly eight percent 325 00:18:30,840 --> 00:18:32,440 Speaker 2: unemployment like economy. 326 00:18:32,600 --> 00:18:35,520 Speaker 6: So I think we see this in the consumer sentiment. 327 00:18:35,640 --> 00:18:37,639 Speaker 6: You know, we see this very clearly in the surveys 328 00:18:37,760 --> 00:18:40,320 Speaker 6: that ask people how likely do you think it is 329 00:18:40,359 --> 00:18:41,040 Speaker 6: you could find a. 330 00:18:41,000 --> 00:18:42,399 Speaker 2: New job if you lost yours? 331 00:18:42,560 --> 00:18:45,280 Speaker 6: How good an economy is this for finding a job? 332 00:18:45,680 --> 00:18:48,080 Speaker 6: So I think this explains some of what we see 333 00:18:48,480 --> 00:18:52,680 Speaker 6: in consumer sentiment. But that is not the headline number. Yeah, 334 00:18:52,680 --> 00:18:55,560 Speaker 6: of course, the headline number is the unemployment rate. 335 00:18:55,600 --> 00:19:00,159 Speaker 2: Okay, but Briga Warsh has the cut rates because we 336 00:19:00,240 --> 00:19:02,960 Speaker 2: have an eight percent unemployment economy, so. 337 00:19:02,920 --> 00:19:05,480 Speaker 6: It is it is not an eight percent of unemployment economy. 338 00:19:05,480 --> 00:19:08,720 Speaker 6: The hiring rate makes it feel like an eight percent 339 00:19:08,800 --> 00:19:11,879 Speaker 6: unemployment economy for people who are looking for work, and 340 00:19:11,920 --> 00:19:12,720 Speaker 6: so we see. 341 00:19:12,480 --> 00:19:13,840 Speaker 7: This for young people. 342 00:19:13,960 --> 00:19:16,560 Speaker 6: Young people are much less likely to be working than 343 00:19:16,600 --> 00:19:19,240 Speaker 6: they were a year ago, even though middle age and 344 00:19:19,240 --> 00:19:20,960 Speaker 6: older adults, if anything, are more. 345 00:19:20,920 --> 00:19:22,240 Speaker 2: Likely to be working a year ago. 346 00:19:22,520 --> 00:19:27,160 Speaker 6: So the pain in this low hiring rate is concentrated. 347 00:19:27,400 --> 00:19:29,800 Speaker 6: It's still a strong labor market if you already. 348 00:19:29,440 --> 00:19:30,000 Speaker 2: Have a job. 349 00:19:30,560 --> 00:19:35,399 Speaker 6: Real earnings are essentially at record levels, so it's a 350 00:19:35,640 --> 00:19:39,040 Speaker 6: very strong labor market for people who have a stable 351 00:19:39,119 --> 00:19:41,840 Speaker 6: job that are not worried about losing having to find one. 352 00:19:42,280 --> 00:19:45,440 Speaker 6: But it's a very tough market if you need to 353 00:19:45,480 --> 00:19:46,160 Speaker 6: get a new job. 354 00:19:46,880 --> 00:19:49,960 Speaker 5: What role does AI play in the labor market? I e. 355 00:19:50,200 --> 00:19:52,560 Speaker 4: We don't need as many new workers in the economy 356 00:19:52,560 --> 00:19:55,840 Speaker 4: because AI is making the existing employees more efficient. 357 00:19:55,920 --> 00:19:57,639 Speaker 5: Is that? Do we see that in the numbers? 358 00:19:57,720 --> 00:19:58,680 Speaker 2: We don't see it yet. 359 00:19:58,760 --> 00:20:01,320 Speaker 6: Okay, this low higher rate is not because of AI. 360 00:20:01,680 --> 00:20:05,520 Speaker 6: The hiring rate has been falling even before the launch 361 00:20:05,640 --> 00:20:09,200 Speaker 6: of the public launch of champ GPT. The low hiring 362 00:20:09,280 --> 00:20:13,920 Speaker 6: rate really started after the pandemic and the pandemic recovery, 363 00:20:14,080 --> 00:20:18,320 Speaker 6: when there was some over hiring at many firms. Of Course, 364 00:20:18,359 --> 00:20:21,960 Speaker 6: the effective AI longer term is anyone's guests on the 365 00:20:22,000 --> 00:20:25,560 Speaker 6: labor market. There will be disruption, there will be rough transition, 366 00:20:26,400 --> 00:20:30,959 Speaker 6: and there are lessons from history from technological changes. 367 00:20:31,119 --> 00:20:33,600 Speaker 2: Even if the. 368 00:20:32,880 --> 00:20:36,600 Speaker 6: Ultimate effect of those past lessons don't look anything like AI, 369 00:20:37,000 --> 00:20:40,639 Speaker 6: we do know about what transitions look like, what disruptions 370 00:20:40,680 --> 00:20:44,600 Speaker 6: look like. Disruptions are especially bad if they're geographically concentrated. 371 00:20:44,840 --> 00:20:48,720 Speaker 6: They're especially bad if people can't easily move to new jobs, 372 00:20:48,760 --> 00:20:53,160 Speaker 6: if they don't have health insurance benefits that let them 373 00:20:53,280 --> 00:20:54,320 Speaker 6: easily move across church. 374 00:20:54,400 --> 00:20:56,160 Speaker 2: Let we get one more in here. You got Chad Bone, 375 00:20:56,200 --> 00:20:59,920 Speaker 2: you got Olivier Blanchard, you got the emeritus William Klein, 376 00:21:00,080 --> 00:21:02,120 Speaker 2: one of my heroes. You get to work with these 377 00:21:02,160 --> 00:21:05,960 Speaker 2: guys every day. The summation of Peterson Institute on. 378 00:21:06,119 --> 00:21:12,879 Speaker 6: Tariffs, UH, the tariffs clearly pose risks. We see this 379 00:21:13,160 --> 00:21:18,280 Speaker 6: in declining manufacturing employment. Some of the effects are still 380 00:21:18,320 --> 00:21:20,920 Speaker 6: too soon to show up in the data. A lot 381 00:21:20,960 --> 00:21:24,760 Speaker 6: of it is playing out in uncertainty, and so you know, 382 00:21:24,800 --> 00:21:28,560 Speaker 6: the risks from tariffs are definitely not behind us. Some 383 00:21:28,640 --> 00:21:32,679 Speaker 6: of this is not even what we've seen yet in 384 00:21:32,760 --> 00:21:34,600 Speaker 6: terms of impact on prices and output. 385 00:21:34,840 --> 00:21:37,920 Speaker 5: But what is likely brewing because of uncertainty? 386 00:21:38,720 --> 00:21:41,119 Speaker 2: I get, I got eight more. We gotta go, We 387 00:21:41,119 --> 00:21:44,720 Speaker 2: got a week before you got to you gotta come back. 388 00:21:44,840 --> 00:21:46,760 Speaker 2: I mean, I just want to talk Zillo and truly, 389 00:21:47,480 --> 00:21:52,520 Speaker 2: I mean I can't emphasize enough. Jed Coco invented the 390 00:21:52,600 --> 00:21:55,920 Speaker 2: madness of our internet real estate world. I mean, you're 391 00:21:55,920 --> 00:21:59,280 Speaker 2: at home sitting on the like six houses of the 392 00:21:59,359 --> 00:22:00,600 Speaker 2: Juicy Yep. 393 00:22:00,800 --> 00:22:02,560 Speaker 5: You know all the time, it's all Jed Cocos, and 394 00:22:02,600 --> 00:22:05,119 Speaker 5: it makes you a much better consumer. You know what 395 00:22:05,160 --> 00:22:05,720 Speaker 5: the comps are? 396 00:22:05,760 --> 00:22:07,600 Speaker 2: Are we better consumers now in real estate. 397 00:22:07,680 --> 00:22:09,800 Speaker 6: Joy Aricley, we are better data nerds. 398 00:22:10,320 --> 00:22:12,119 Speaker 2: Hes Yes, I'll take you. 399 00:22:12,160 --> 00:22:12,360 Speaker 6: Yeah. 400 00:22:12,440 --> 00:22:15,960 Speaker 2: Good Jed Coco, thank you so much for the Peterson Institute. Brilliant. 401 00:22:16,000 --> 00:22:20,760 Speaker 2: We'll get them back in here again. Stay with us. 402 00:22:21,000 --> 00:22:24,240 Speaker 2: More from Bloomberg Surveillance coming up after this. 403 00:22:31,480 --> 00:22:35,080 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live 404 00:22:35,119 --> 00:22:38,280 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 405 00:22:38,359 --> 00:22:41,760 Speaker 1: Apple Karplay and Android Auto with the Bloomberg Business app, 406 00:22:41,960 --> 00:22:43,640 Speaker 1: or watch us live on YouTube. 407 00:22:43,920 --> 00:22:47,000 Speaker 2: The book is The Doom Loop, Why the World Economic 408 00:22:47,119 --> 00:22:51,240 Speaker 2: order is spiraling into disorder. This is shockingly gloomy for 409 00:22:51,320 --> 00:22:54,880 Speaker 2: such a nice guy. Let me explain as our prosade 410 00:22:54,960 --> 00:22:58,840 Speaker 2: to you. If you are Robby Rogen out of Chicago, 411 00:22:59,520 --> 00:23:02,760 Speaker 2: Robert rub In, the former Secretary Treasury. He codified the 412 00:23:02,800 --> 00:23:07,400 Speaker 2: word likelihood in terms of probability Summer's Up at Harvard 413 00:23:07,720 --> 00:23:11,280 Speaker 2: and Janet Yellen from the University of Brooklyn. The answer 414 00:23:11,320 --> 00:23:14,760 Speaker 2: is who do they listen to? They listened to zwar 415 00:23:14,840 --> 00:23:18,640 Speaker 2: Prasad on the China Watch at the International Monetary Fund 416 00:23:18,800 --> 00:23:22,080 Speaker 2: and Legendary at Cornell. This is a really important book. 417 00:23:22,440 --> 00:23:25,040 Speaker 2: Why are you so gloomy. This is not like you. 418 00:23:25,600 --> 00:23:26,720 Speaker 2: What is a doom loop? 419 00:23:27,119 --> 00:23:29,440 Speaker 8: I did not start out being gloomy, Tom. In fact, 420 00:23:29,480 --> 00:23:31,720 Speaker 8: the book I planned to write was a very different book. 421 00:23:32,040 --> 00:23:33,960 Speaker 8: It was about how we might be moving from a 422 00:23:34,080 --> 00:23:36,880 Speaker 8: unipolar world when, after the collapse of the Soviet Union 423 00:23:36,840 --> 00:23:39,120 Speaker 8: in the US, became the domum power in aavy respect, 424 00:23:39,359 --> 00:23:42,080 Speaker 8: to one where economic power is more evenly balanced. And 425 00:23:42,080 --> 00:23:45,480 Speaker 8: as an economist, one thinks competition is good for balance, 426 00:23:45,640 --> 00:23:48,840 Speaker 8: efficiency and stabidity. But as I thought about all the 427 00:23:48,880 --> 00:23:51,280 Speaker 8: forces that I was going to argue would push us 428 00:23:51,280 --> 00:23:54,120 Speaker 8: back to a more stable world, a more stable equilibrium, 429 00:23:54,480 --> 00:23:56,840 Speaker 8: I began to realize that each of these forces might 430 00:23:56,880 --> 00:24:01,080 Speaker 8: actually generate more instability rather than steadily. So the book 431 00:24:01,320 --> 00:24:06,000 Speaker 8: ended up being one about where economics, domestic politics, and geopolitics, 432 00:24:06,080 --> 00:24:08,560 Speaker 8: which always go on parlate tracks, they intersect with each other, 433 00:24:08,800 --> 00:24:11,400 Speaker 8: but in this case they're feeding off each other into 434 00:24:11,400 --> 00:24:14,520 Speaker 8: a negative loop, a negative feedback loop, and bringing out 435 00:24:14,520 --> 00:24:15,520 Speaker 8: the worst in each other. 436 00:24:15,680 --> 00:24:18,199 Speaker 2: So your publishers didn't say make it gloomy so you 437 00:24:18,200 --> 00:24:19,440 Speaker 2: could sell the movie rights. 438 00:24:20,119 --> 00:24:20,399 Speaker 7: Tom. 439 00:24:20,480 --> 00:24:22,680 Speaker 8: As I was writing this book, my heart was pulling 440 00:24:22,720 --> 00:24:25,359 Speaker 8: in one direction, but my head was pulling in completely 441 00:24:25,480 --> 00:24:28,199 Speaker 8: under their direction. And I think the reality is that, 442 00:24:28,280 --> 00:24:30,679 Speaker 8: you know, we're in a difficult world right now, and 443 00:24:30,720 --> 00:24:32,840 Speaker 8: the book ultimately is going to help us at least 444 00:24:32,920 --> 00:24:35,960 Speaker 8: understand the forces that brought us here before we think 445 00:24:36,000 --> 00:24:37,480 Speaker 8: about solutions. 446 00:24:38,160 --> 00:24:40,600 Speaker 4: Professor, we I think most of our listeners, most of 447 00:24:40,640 --> 00:24:44,040 Speaker 4: our viewers, grew up in a world of globalization. Is 448 00:24:44,119 --> 00:24:47,080 Speaker 4: globalization unraveling right before our eyes right here. 449 00:24:47,280 --> 00:24:50,200 Speaker 8: So globalization was once seen as a positive some game, 450 00:24:50,240 --> 00:24:53,000 Speaker 8: you know, which should offset the zero some game of geopolitics. 451 00:24:53,240 --> 00:24:56,359 Speaker 8: The US China relationship was a perfect example, you know, 452 00:24:56,400 --> 00:24:59,400 Speaker 8: the two countries could not you know, come to terms 453 00:24:59,400 --> 00:25:02,320 Speaker 8: on certain gy political issues, but the economic relationship was 454 00:25:02,400 --> 00:25:05,520 Speaker 8: seen as one that could benefit both countries. But now 455 00:25:05,560 --> 00:25:08,960 Speaker 8: even globalization is being seen as a negative or zero 456 00:25:09,040 --> 00:25:12,280 Speaker 8: sum game where even there there are no common benefits 457 00:25:12,359 --> 00:25:15,160 Speaker 8: to be had. And it's worth thinking about what happened here. 458 00:25:15,400 --> 00:25:19,440 Speaker 8: Globalization did deliver aggregate benefits, but these were not well 459 00:25:19,480 --> 00:25:23,879 Speaker 8: distributed within countries or between countries. So within countries, in 460 00:25:23,920 --> 00:25:27,120 Speaker 8: both advanced and emerging market countries, it created this sense 461 00:25:27,200 --> 00:25:31,280 Speaker 8: of a discantled community that essentially felt left out of opportunity, 462 00:25:31,560 --> 00:25:35,680 Speaker 8: and that infected domestic politics, which in turn, is hurting geopolitics. 463 00:25:35,840 --> 00:25:39,359 Speaker 2: I would mention Joseph Stiglets there are just absolutely definitive 464 00:25:39,440 --> 00:25:43,679 Speaker 2: is book on discontent among globalization decades ago as our 465 00:25:43,760 --> 00:25:45,960 Speaker 2: prosade where there's the book is a doom loop. We're 466 00:25:45,960 --> 00:25:49,240 Speaker 2: going to continue here with professor pad of course help Paul. 467 00:25:49,720 --> 00:25:53,280 Speaker 4: So where do we go from here in terms of 468 00:25:54,160 --> 00:25:59,360 Speaker 4: an economy that is a global economy. Technology has really 469 00:25:59,400 --> 00:26:04,760 Speaker 4: reduced two distances and it just made everything more tangible here, 470 00:26:05,200 --> 00:26:07,680 Speaker 4: how do we go back to something less global? 471 00:26:07,960 --> 00:26:10,120 Speaker 5: And should we go back to something less global? 472 00:26:10,200 --> 00:26:12,399 Speaker 8: So what we are seeing is not a complete retreat 473 00:26:12,400 --> 00:26:16,479 Speaker 8: from globalization, but it's becoming fragmented. So countries are sending 474 00:26:16,520 --> 00:26:19,520 Speaker 8: more trade and financial flows to countries with which they 475 00:26:19,520 --> 00:26:23,040 Speaker 8: are geopolitically aligned. So trade and finance, rather than being 476 00:26:23,119 --> 00:26:27,200 Speaker 8: bridges across the geopolitical drifts, are in fact deepening those rifts. 477 00:26:27,359 --> 00:26:29,280 Speaker 8: And the same is true of technology. That was what, 478 00:26:29,400 --> 00:26:31,879 Speaker 8: in my cheerful version of the book was going to 479 00:26:31,880 --> 00:26:33,679 Speaker 8: be what led us all to a better place, and 480 00:26:33,720 --> 00:26:36,680 Speaker 8: it is creating enormous progress. But at the same time, 481 00:26:36,680 --> 00:26:39,080 Speaker 8: as I point out in my book, it's creating much 482 00:26:39,119 --> 00:26:44,080 Speaker 8: more economic and financial power concentration within countries and between countries, 483 00:26:44,280 --> 00:26:46,080 Speaker 8: which is where the dissension comes from. 484 00:26:46,200 --> 00:26:47,720 Speaker 2: You know how I do this. So I picked up 485 00:26:47,720 --> 00:26:49,480 Speaker 2: the book and I went to the index, and I 486 00:26:49,520 --> 00:26:54,360 Speaker 2: looked for Carnie in Canada. Carneie of Canada stopped Davos 487 00:26:54,400 --> 00:26:58,600 Speaker 2: talking about the middle countries in a new variable geometry. 488 00:26:58,800 --> 00:27:01,600 Speaker 2: Discuss that geomme within the dual loop. 489 00:27:01,960 --> 00:27:04,520 Speaker 8: So when I think about the superpower competition right now, 490 00:27:04,560 --> 00:27:06,720 Speaker 8: you have these two on both sides, and everybody else 491 00:27:06,760 --> 00:27:08,919 Speaker 8: is stuck in the middle. My European friends don't like 492 00:27:08,960 --> 00:27:10,440 Speaker 8: it when I say this, but Europe is sort of 493 00:27:10,520 --> 00:27:13,000 Speaker 8: a middle power because it's not grown up to clear, 494 00:27:13,640 --> 00:27:16,040 Speaker 8: you know, a real power on its own. So everybody 495 00:27:16,080 --> 00:27:18,240 Speaker 8: else is stuck in the middle of these two very 496 00:27:18,320 --> 00:27:22,280 Speaker 8: unsavory alternatives. The US is receding from its leadership role 497 00:27:22,320 --> 00:27:24,760 Speaker 8: in the world economy. China is not seen as a 498 00:27:24,880 --> 00:27:28,120 Speaker 8: trustworthy and reliable ally. So take what India, the archetype 499 00:27:28,119 --> 00:27:30,919 Speaker 8: of middle power does. On issues like cheap oil. It 500 00:27:30,960 --> 00:27:33,600 Speaker 8: aligns with Russia and China, But on the other hand, 501 00:27:33,640 --> 00:27:36,879 Speaker 8: it sees its fundamental values as aligned more closely with 502 00:27:36,920 --> 00:27:39,680 Speaker 8: the West, so it teeters from one side to the other. 503 00:27:39,920 --> 00:27:43,080 Speaker 8: So Mark Connie took a very pragmatic approach. He pointed out, 504 00:27:43,119 --> 00:27:47,040 Speaker 8: as I in my book that Middle powers include rich 505 00:27:47,080 --> 00:27:49,720 Speaker 8: and poor, small and large countries. Their interests are not 506 00:27:49,760 --> 00:27:52,840 Speaker 8: perfectly aligned. But he argued that maybe they should align 507 00:27:52,840 --> 00:27:56,159 Speaker 8: on specific issues, which makes sense. The problem is it 508 00:27:56,200 --> 00:28:00,919 Speaker 8: doesn't create deep trust that is necessary to underpin strong alliances. 509 00:28:01,119 --> 00:28:03,960 Speaker 8: So the middle powers themselves again a chapter of my book, 510 00:28:04,320 --> 00:28:07,879 Speaker 8: rather than being sources of stability, are becoming sources of 511 00:28:07,920 --> 00:28:09,000 Speaker 8: instability themselves. 512 00:28:09,000 --> 00:28:12,240 Speaker 2: Trilogue back. I mean President Trump loves to go back 513 00:28:12,240 --> 00:28:14,440 Speaker 2: to McKinley in the Gilded Age. We'll get the tariffs 514 00:28:14,440 --> 00:28:17,439 Speaker 2: here in a moment with Azar Persad. But to finish 515 00:28:17,520 --> 00:28:20,199 Speaker 2: up on the doom loop here, do you have an 516 00:28:20,359 --> 00:28:23,800 Speaker 2: analog of as Paul mentioned earlier, almost a nostalgia for 517 00:28:23,840 --> 00:28:26,600 Speaker 2: a different time and place, or are we going to 518 00:28:26,680 --> 00:28:28,840 Speaker 2: a new new that we've never seen before. 519 00:28:29,160 --> 00:28:31,480 Speaker 8: The fundamental problem right now is that if you think 520 00:28:31,520 --> 00:28:33,760 Speaker 8: about the competition between the US and Japan in the 521 00:28:33,840 --> 00:28:36,320 Speaker 8: nineteen nineties, the US and the Euro Area in the 522 00:28:36,400 --> 00:28:39,600 Speaker 8: two thousands, it was about economic competition. But now the 523 00:28:39,640 --> 00:28:43,520 Speaker 8: competition between the two powers is completely different. It's about 524 00:28:43,520 --> 00:28:47,720 Speaker 8: the visions of the world about how to organize an economic, political, 525 00:28:47,840 --> 00:28:49,640 Speaker 8: legal system. So I don't think there is going to 526 00:28:49,680 --> 00:28:52,400 Speaker 8: be an easy way at all for these two visions 527 00:28:52,400 --> 00:28:54,440 Speaker 8: to be merged. So I think we are stuck with 528 00:28:54,520 --> 00:28:56,040 Speaker 8: the doom loop for some time to come. 529 00:28:56,640 --> 00:28:58,720 Speaker 5: What is the role of the US in this new 530 00:28:58,760 --> 00:28:59,520 Speaker 5: world order? 531 00:28:59,600 --> 00:29:03,800 Speaker 4: I mean, is this just a Trump issue and if 532 00:29:03,800 --> 00:29:06,880 Speaker 4: we get somebody new in three years, the US will 533 00:29:06,880 --> 00:29:09,760 Speaker 4: try to reassert its leadership position. 534 00:29:09,840 --> 00:29:11,880 Speaker 5: How do you see the US moving forward? 535 00:29:12,120 --> 00:29:13,800 Speaker 8: Well, Paul, I wish that was the case. But I 536 00:29:13,800 --> 00:29:16,000 Speaker 8: should point out that I finished the first draft of 537 00:29:16,040 --> 00:29:18,800 Speaker 8: my book in October of twenty twenty four. I put 538 00:29:18,840 --> 00:29:21,240 Speaker 8: it down and thought, my god, this is too dark. 539 00:29:21,320 --> 00:29:24,200 Speaker 8: Let's wait for the elections and maybe things will settle down. 540 00:29:24,200 --> 00:29:26,720 Speaker 8: But everything that has happened since I finished my first 541 00:29:26,800 --> 00:29:30,880 Speaker 8: draft has only validated or supercharged the thesis of the book, 542 00:29:30,880 --> 00:29:33,080 Speaker 8: which is unfortunate for the world. But I think the 543 00:29:33,160 --> 00:29:36,160 Speaker 8: issue is the US is now receding from its leadership role, 544 00:29:36,440 --> 00:29:39,360 Speaker 8: but it's causing some other countries to stiffen their spines. 545 00:29:39,400 --> 00:29:41,960 Speaker 8: You know, Europe is coming together at one level. The 546 00:29:42,040 --> 00:29:44,760 Speaker 8: question is whether there is a political will not just 547 00:29:44,800 --> 00:29:47,600 Speaker 8: to deal with territorial integrity attacks, but to do what 548 00:29:47,720 --> 00:29:52,280 Speaker 8: is necessary to improve productivity, to come together, to reshape 549 00:29:52,520 --> 00:29:55,560 Speaker 8: institutions within these countries, and for these countries to basically 550 00:29:55,840 --> 00:29:56,760 Speaker 8: get their backs together. 551 00:29:56,880 --> 00:29:59,840 Speaker 2: What do you perceive as a presad to pause? One 552 00:30:00,360 --> 00:30:04,320 Speaker 2: question here about after Trump? I mean, if he's established 553 00:30:04,360 --> 00:30:09,440 Speaker 2: some form of neo mercantilist zero sum structure, where are 554 00:30:09,480 --> 00:30:12,080 Speaker 2: we two years or three years after Trump. 555 00:30:12,480 --> 00:30:14,040 Speaker 7: It's going to be difficult to reverse. 556 00:30:14,040 --> 00:30:15,480 Speaker 8: But as a point out in the book, you know, 557 00:30:15,560 --> 00:30:18,320 Speaker 8: there is a ray of open if we as citizens 558 00:30:18,320 --> 00:30:20,640 Speaker 8: are willing to become much more engaged, not just the 559 00:30:20,720 --> 00:30:24,040 Speaker 8: citizens of our countries, but of our communities in the world, 560 00:30:24,080 --> 00:30:26,719 Speaker 8: if we have more inspiring leaders, and if we can 561 00:30:26,840 --> 00:30:29,840 Speaker 8: repair our institutions, I think there is a way forward. 562 00:30:29,840 --> 00:30:31,240 Speaker 7: But it's going to take a lot of work. 563 00:30:31,320 --> 00:30:32,680 Speaker 2: The book is a doom look, but I've got to 564 00:30:32,720 --> 00:30:34,640 Speaker 2: move on to terrorists. I got as a proside in 565 00:30:34,640 --> 00:30:37,040 Speaker 2: the studio, and he owns the high ground. I'm in 566 00:30:37,080 --> 00:30:40,560 Speaker 2: the camp, as were the tariffs. We've lost sight of, 567 00:30:40,880 --> 00:30:43,880 Speaker 2: and yet they drag on. There's almost an inertial force 568 00:30:44,280 --> 00:30:47,880 Speaker 2: to the effect of tariffs on our listeners and viewers 569 00:30:47,960 --> 00:30:48,680 Speaker 2: is that true. 570 00:30:49,080 --> 00:30:50,680 Speaker 7: It's certainly going to have an effect. 571 00:30:50,720 --> 00:30:53,400 Speaker 8: I mean, it's hard to imagine that tariffs are not 572 00:30:53,520 --> 00:30:57,560 Speaker 8: going to affect both you know, consumer welfare and also prices. Certainly, 573 00:30:57,560 --> 00:31:00,880 Speaker 8: there have been other forces, such as phenomenal productivity growth 574 00:31:00,920 --> 00:31:04,239 Speaker 8: in the US that help tann down inflation. But you know, 575 00:31:04,320 --> 00:31:07,360 Speaker 8: the notion of lean means supply chains that are delivering 576 00:31:07,440 --> 00:31:11,560 Speaker 8: better goods, better choices for consumers, that is sort of gone. 577 00:31:11,640 --> 00:31:13,520 Speaker 8: And I think the bigger issue, which is going to 578 00:31:13,600 --> 00:31:15,440 Speaker 8: last for a while, is the fact that we now 579 00:31:15,440 --> 00:31:20,240 Speaker 8: have this fragmentation of global trade, which again is bad 580 00:31:20,360 --> 00:31:23,960 Speaker 8: from an economic perspective for businesses. Businesses are retreating and 581 00:31:24,040 --> 00:31:27,280 Speaker 8: worrying more about resilience rather than efficiency. This is not 582 00:31:27,320 --> 00:31:30,240 Speaker 8: good for the world economy. And most importantly, as I argued, 583 00:31:30,560 --> 00:31:34,360 Speaker 8: trade is not helping to bridge countries anymore. It is 584 00:31:34,400 --> 00:31:37,000 Speaker 8: creating even deeper rifts. And that I think is the 585 00:31:37,000 --> 00:31:38,200 Speaker 8: fundamental known. 586 00:31:38,120 --> 00:31:42,120 Speaker 2: As work for like a million years, and this is 587 00:31:42,200 --> 00:31:44,280 Speaker 2: just shocking to hear the doom loop from US work. 588 00:31:44,400 --> 00:31:50,680 Speaker 4: Exactly does this fracturing of global trade is that an 589 00:31:50,680 --> 00:31:53,800 Speaker 4: inflationary force? I mean, will prices go up for us? 590 00:31:53,840 --> 00:31:56,760 Speaker 4: Because haven't we gotten used to over the last fifty years, 591 00:31:57,120 --> 00:32:00,960 Speaker 4: seven years. This is just getting the cheapest widget. The 592 00:32:00,960 --> 00:32:03,720 Speaker 4: widget I have to buy. It's a lower cost because 593 00:32:03,760 --> 00:32:05,840 Speaker 4: it's built somewhere where their costs are lower. 594 00:32:06,040 --> 00:32:09,480 Speaker 8: So businesses always face a lot of risks, but now 595 00:32:09,520 --> 00:32:13,680 Speaker 8: they face, you know, supercharge risks in terms of geopolitical risk, 596 00:32:13,760 --> 00:32:16,800 Speaker 8: risks related to climate change and how they're responding. They're 597 00:32:16,800 --> 00:32:21,480 Speaker 8: responding by pulling production back on shore. They're trying to diversify, 598 00:32:21,520 --> 00:32:23,800 Speaker 8: but that creates its own risk because you know, friends 599 00:32:23,800 --> 00:32:26,880 Speaker 8: today might become rivals tomorrow, as we've seen from presidents 600 00:32:26,880 --> 00:32:30,080 Speaker 8: from stariff policies. So that means that you're going to 601 00:32:30,120 --> 00:32:33,120 Speaker 8: lose a lot of efficiency in the name of resilience. 602 00:32:33,200 --> 00:32:35,800 Speaker 8: And certainly resilience is good for businesses, but it is 603 00:32:35,840 --> 00:32:38,440 Speaker 8: going to mean higher costs for businesses and that's going 604 00:32:38,480 --> 00:32:41,120 Speaker 8: to get passed on to consumers. So it means less choice, 605 00:32:41,440 --> 00:32:45,760 Speaker 8: higher costs, and more importantly, all of this behavior by businesses, 606 00:32:45,800 --> 00:32:48,920 Speaker 8: it once again means that they no longer are stabilizing force. 607 00:32:48,920 --> 00:32:52,360 Speaker 8: The geopolitical drifts are going to create even more instability 608 00:32:52,360 --> 00:32:53,320 Speaker 8: and strive almost go to. 609 00:32:53,360 --> 00:32:56,760 Speaker 2: Your claim on currency on China as well. The stealth 610 00:32:56,800 --> 00:32:59,760 Speaker 2: thing here, folks, We've barely covered It is very quietly 611 00:33:00,080 --> 00:33:06,080 Speaker 2: on the rimmenbe is strengthening through a through seven and stronger, stronger. 612 00:33:06,120 --> 00:33:09,760 Speaker 2: I mean, do you perceive a Pacific rim strengthening here 613 00:33:10,160 --> 00:33:13,440 Speaker 2: and a weaker US dollar what President Trump ultimately wants. 614 00:33:13,800 --> 00:33:16,480 Speaker 8: It's worth thinking about exactly what the conjunction is here. 615 00:33:16,520 --> 00:33:19,840 Speaker 8: The US is driving away country straight through tariffs. China 616 00:33:19,880 --> 00:33:22,400 Speaker 8: at the moment has a very unbalanced economy, is growing 617 00:33:22,560 --> 00:33:26,400 Speaker 8: largely through experts. It's got it registered at one point 618 00:33:26,440 --> 00:33:29,360 Speaker 8: to trillion dollar trade surplus last year, and the rest 619 00:33:29,360 --> 00:33:31,920 Speaker 8: of the world is terrified about going too close into 620 00:33:32,000 --> 00:33:35,760 Speaker 8: China's embrace because it would mean being swarmed by Chinese exports. 621 00:33:36,000 --> 00:33:39,240 Speaker 8: Given where China's trade surplus is, certainly the currency should 622 00:33:39,240 --> 00:33:41,680 Speaker 8: be appreciating a lot more than it is right now. 623 00:33:41,680 --> 00:33:45,320 Speaker 2: So between Carnia and Canada and whatever is after President Trump, 624 00:33:45,320 --> 00:33:49,840 Speaker 2: Republican or Democrat. To Paul's question, the bottom line is 625 00:33:49,840 --> 00:33:55,200 Speaker 2: is after Trump, if China's troubled, we just reaffirm what 626 00:33:55,280 --> 00:33:57,200 Speaker 2: Paul was talking about globalization. 627 00:33:57,760 --> 00:34:00,560 Speaker 8: We could, and in fact, the US potentially as the 628 00:34:00,640 --> 00:34:03,680 Speaker 8: ability to re engineer its place on the world stage. 629 00:34:03,680 --> 00:34:06,080 Speaker 8: But I think some notion of trust is being lost. 630 00:34:06,360 --> 00:34:08,160 Speaker 8: You know, this is not the first drump term, this 631 00:34:08,280 --> 00:34:10,759 Speaker 8: is the second drum term. And as I speak to 632 00:34:10,880 --> 00:34:13,160 Speaker 8: you know, policymakers around the world their US. If the 633 00:34:13,280 --> 00:34:16,120 Speaker 8: US can electrum not just once, but twice, how can 634 00:34:16,160 --> 00:34:17,960 Speaker 8: we ever go back and trust the US. You know, 635 00:34:18,000 --> 00:34:22,160 Speaker 8: the US's closest allies, NATO, Canada and so on, are 636 00:34:22,200 --> 00:34:25,080 Speaker 8: feeling the heat from Trump. So no country feels that 637 00:34:25,120 --> 00:34:28,520 Speaker 8: it's going to escape what might be internal political dynamics 638 00:34:28,520 --> 00:34:30,640 Speaker 8: within the US that turn it away. So there is 639 00:34:30,680 --> 00:34:32,480 Speaker 8: a place for the US. It's going to take a 640 00:34:32,480 --> 00:34:33,719 Speaker 8: lot of work to reclaim it. 641 00:34:34,480 --> 00:34:37,400 Speaker 4: So just the European Union, can we expect the European 642 00:34:37,480 --> 00:34:41,600 Speaker 4: Union to finally get its act together and maybe get 643 00:34:41,760 --> 00:34:44,680 Speaker 4: its position on the world stage commensurate with its population, 644 00:34:44,880 --> 00:34:46,160 Speaker 4: commensurately with its GDP. 645 00:34:46,880 --> 00:34:49,719 Speaker 8: Moments of crisis do sometimes Pauls tend to bring out, 646 00:34:49,840 --> 00:34:53,359 Speaker 8: you know, the best in countries, and certainly the European Union. 647 00:34:53,440 --> 00:34:57,040 Speaker 8: The Europe overall came together when its territorial integrity was 648 00:34:57,080 --> 00:35:00,000 Speaker 8: threatened in the context of Ukraine, in the context of Greenland, 649 00:35:00,000 --> 00:35:02,560 Speaker 8: and a big question for Europe is whether it can 650 00:35:02,600 --> 00:35:05,719 Speaker 8: get away from its internal political divisions to do what 651 00:35:05,880 --> 00:35:08,880 Speaker 8: is needed to become a true economic power. This will require, 652 00:35:09,160 --> 00:35:12,359 Speaker 8: you know, deregulating in order to increase productivity growth within 653 00:35:12,400 --> 00:35:15,760 Speaker 8: the zone. You know, true economic union that goes beyond 654 00:35:15,800 --> 00:35:19,680 Speaker 8: this monetary to banking union, to payments union, and a 655 00:35:19,719 --> 00:35:22,040 Speaker 8: more significant political union as well. 656 00:35:22,080 --> 00:35:22,960 Speaker 7: I don't see that happening. 657 00:35:23,040 --> 00:35:24,560 Speaker 2: Yeah, that's going to say we've got to run here. 658 00:35:24,560 --> 00:35:25,880 Speaker 2: But that's a hope of prayer. 659 00:35:26,440 --> 00:35:27,319 Speaker 7: That's exactly right. 660 00:35:27,400 --> 00:35:29,480 Speaker 2: I mean, if le Guard was sitting here, she'd say 661 00:35:30,080 --> 00:35:33,239 Speaker 2: that's all brilliant as were, But there's no indication you're 662 00:35:33,480 --> 00:35:34,520 Speaker 2: going to get their act together. 663 00:35:34,640 --> 00:35:36,360 Speaker 8: Europe could be a great power, it's going to be 664 00:35:36,440 --> 00:35:37,879 Speaker 8: a big challenge for it to get there. 665 00:35:38,760 --> 00:35:41,719 Speaker 2: This book, Paul, Yeah, he's like, what's the response of 666 00:35:42,080 --> 00:35:44,360 Speaker 2: people in the racket when they see the doom loop? 667 00:35:45,080 --> 00:35:47,120 Speaker 7: The response is this is a book for the moment. 668 00:35:47,200 --> 00:35:49,239 Speaker 8: I mean, it tells us exactly why we are ware 669 00:35:49,239 --> 00:35:51,480 Speaker 8: we are because there is a lot of turmoil around us. 670 00:35:51,760 --> 00:35:53,600 Speaker 8: And when I started working on this book, it was 671 00:35:53,640 --> 00:35:56,239 Speaker 8: my objective really to understand what are the forces that 672 00:35:56,280 --> 00:35:58,919 Speaker 8: God is here, because we need to get there first 673 00:35:58,960 --> 00:36:00,040 Speaker 8: before we can think about. 674 00:36:00,680 --> 00:36:02,440 Speaker 2: I'll throw it out on LinkedIn and Twitter. Folks at 675 00:36:02,440 --> 00:36:07,120 Speaker 2: doom Loop Why the World Economic order is spiraling into disorder? 676 00:36:07,280 --> 00:36:11,160 Speaker 2: A shocking book form Persad of Cornell as our prosad 677 00:36:12,360 --> 00:36:15,920 Speaker 2: with this book, and I just can't imagine Mark Kearney 678 00:36:16,200 --> 00:36:21,319 Speaker 2: reading it. Love to see if that happens. Stay with us. 679 00:36:21,560 --> 00:36:24,799 Speaker 2: More from Bloomberg Surveillance coming up after this. 680 00:36:32,040 --> 00:36:35,640 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live 681 00:36:35,680 --> 00:36:38,840 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 682 00:36:38,920 --> 00:36:42,320 Speaker 1: Apple Karplay and Android Auto with the Bloomberg Business app, 683 00:36:42,520 --> 00:36:44,920 Speaker 1: or watch us live on YouTube lessus. 684 00:36:45,000 --> 00:36:47,960 Speaker 2: Christopher's in here to get us started. In the newspapers, 685 00:36:48,200 --> 00:36:51,239 Speaker 2: is it hard? I'm seeing so many Like I'm like, 686 00:36:51,320 --> 00:36:53,719 Speaker 2: I wish Alexis would do this story. Is it like 687 00:36:53,760 --> 00:36:55,240 Speaker 2: too many stories to pick? 688 00:36:55,840 --> 00:36:56,000 Speaker 5: You know? 689 00:36:56,200 --> 00:36:59,480 Speaker 9: So it's feast or famine? Really when you're doing the newspapers. 690 00:36:59,480 --> 00:37:01,279 Speaker 9: Today wasn't bad and I got a good one to 691 00:37:01,280 --> 00:37:03,520 Speaker 9: start us off. So the big game just a few 692 00:37:03,600 --> 00:37:07,959 Speaker 9: days away, right, Patriots, Seahawks, the Super Bowl scams, they're 693 00:37:08,000 --> 00:37:10,000 Speaker 9: all around us. If you're looking for last minute tickets, 694 00:37:10,040 --> 00:37:12,680 Speaker 9: first of all, you better have deep pockets. But you've 695 00:37:12,719 --> 00:37:15,680 Speaker 9: got the fake emails, the fake texts, the social media adds, 696 00:37:15,880 --> 00:37:20,120 Speaker 9: they're everywhere and more and more. The NFL is wanting 697 00:37:20,160 --> 00:37:22,480 Speaker 9: you to come in with a digital ticket, not a 698 00:37:22,480 --> 00:37:24,880 Speaker 9: paper ticket, because now they can track the digital ticket, 699 00:37:24,920 --> 00:37:27,239 Speaker 9: which makes sense. So you want to be wary of 700 00:37:27,280 --> 00:37:29,359 Speaker 9: third party sellers that appear to have a. 701 00:37:29,280 --> 00:37:30,879 Speaker 2: Lot of ticket Thank you for doing this. 702 00:37:31,280 --> 00:37:33,080 Speaker 7: Yeah, you know, we try to serve the people. 703 00:37:33,160 --> 00:37:34,919 Speaker 2: No, but this is like a huge deal. 704 00:37:35,280 --> 00:37:37,640 Speaker 9: Yeah, I mean the people who look, it's sad because 705 00:37:37,640 --> 00:37:39,319 Speaker 9: you think you're buying a legit ticket. You get to 706 00:37:39,320 --> 00:37:40,640 Speaker 9: the gate and they tell you, guess what. 707 00:37:42,480 --> 00:37:45,640 Speaker 2: Paper? You just got to go digital from a reputable source. 708 00:37:45,800 --> 00:37:49,040 Speaker 9: Exactly. Yeah, so check the source, make sure they are reputable, 709 00:37:49,160 --> 00:37:51,600 Speaker 9: check the ratings, check the reviews before buying. And you 710 00:37:51,640 --> 00:37:53,279 Speaker 9: know what folks buy with your credit card. I think 711 00:37:53,280 --> 00:37:55,960 Speaker 9: we kind of all know this. Don't buy no wire transfer, 712 00:37:56,120 --> 00:37:59,360 Speaker 9: transfer is no direct, that's not deposit. 713 00:37:59,480 --> 00:37:59,520 Speaker 6: No. 714 00:38:00,520 --> 00:38:03,640 Speaker 2: Yeah, I mean the names that we know, Paul, like 715 00:38:03,960 --> 00:38:06,600 Speaker 2: Paul's got a real life Alexis and I don't. But 716 00:38:06,760 --> 00:38:11,080 Speaker 2: like Ticketmaster, stub Hub, those kinds of seat geek, they're legitimate, right. 717 00:38:11,000 --> 00:38:12,759 Speaker 4: And I learned it the hard way, I picked one 718 00:38:12,840 --> 00:38:15,919 Speaker 4: that came at the top of my search, the Eagles tickets. Yeah, 719 00:38:16,120 --> 00:38:18,200 Speaker 4: day of flying out the Vegas found out that those 720 00:38:18,200 --> 00:38:21,080 Speaker 4: Eagle tickets were bogus and they were not cheap. 721 00:38:21,520 --> 00:38:25,200 Speaker 2: Yesterday, folks, I can't tell you the scams. What a 722 00:38:25,280 --> 00:38:29,440 Speaker 2: shock in offspring needed an airplane ticket. I'm shocked. Okay, 723 00:38:29,480 --> 00:38:32,400 Speaker 2: first one in February. I go on, I do a 724 00:38:32,520 --> 00:38:36,680 Speaker 2: search Google, and the people I use there was a 725 00:38:36,719 --> 00:38:40,200 Speaker 2: fake account of them up top geez. And when I 726 00:38:40,239 --> 00:38:42,279 Speaker 2: went to it, I clicked on it because the same name, 727 00:38:42,920 --> 00:38:44,560 Speaker 2: and I could tell it was a scam. 728 00:38:44,719 --> 00:38:45,120 Speaker 7: Good for you. 729 00:38:45,160 --> 00:38:46,600 Speaker 9: Yeah, Well, they're getting smarter and smarter. 730 00:38:46,680 --> 00:38:49,520 Speaker 2: As Cary tell your kids, I'm telling my kids all 731 00:38:49,600 --> 00:38:50,520 Speaker 2: that bill got takes. 732 00:38:50,560 --> 00:38:51,600 Speaker 9: Did you get your money back? 733 00:38:51,760 --> 00:38:54,040 Speaker 5: No? No, really, sorry about that? 734 00:38:54,560 --> 00:38:54,839 Speaker 2: All right? 735 00:38:54,960 --> 00:38:57,560 Speaker 9: Well, as we following that, may have another cup of coffee? 736 00:38:57,600 --> 00:38:57,920 Speaker 8: All right? 737 00:38:58,239 --> 00:39:01,799 Speaker 9: This one from Business Insider. Tailors in New York City 738 00:39:01,840 --> 00:39:04,680 Speaker 9: have noticed a growing trend clients are getting their clothes 739 00:39:04,719 --> 00:39:08,640 Speaker 9: altered thanks to the weight loss drug o Zevich. So 740 00:39:08,800 --> 00:39:11,600 Speaker 9: they're saying that usually people would come in and say, listen, 741 00:39:11,600 --> 00:39:14,000 Speaker 9: take out the pants a couple of inches or two. 742 00:39:14,560 --> 00:39:17,200 Speaker 9: Now they're coming in with their entire wardrobe, saying I 743 00:39:17,239 --> 00:39:19,200 Speaker 9: lost twenty and thirty pounds. You need to bring my 744 00:39:19,280 --> 00:39:22,279 Speaker 9: clothes out. One tailor even said he had to bring 745 00:39:22,320 --> 00:39:24,200 Speaker 9: more people on because he has just too much work 746 00:39:24,239 --> 00:39:26,520 Speaker 9: for him. Right, this is a good problem to have, 747 00:39:26,840 --> 00:39:29,439 Speaker 9: he says. Instead of altering clothing, some are just going out. 748 00:39:29,560 --> 00:39:31,160 Speaker 9: This is what I would do, yes, just going out 749 00:39:31,200 --> 00:39:35,160 Speaker 9: and buying homeless. And when they do, what are they 750 00:39:35,160 --> 00:39:38,879 Speaker 9: looking for? Slim fit, shorter jackets and this I can 751 00:39:38,920 --> 00:39:43,080 Speaker 9: get behind less shoulder pads. I'm talking the nineties jackets 752 00:39:43,080 --> 00:39:45,239 Speaker 9: when I was doing this, coming down like I was 753 00:39:45,280 --> 00:39:48,600 Speaker 9: a football player, all right, So glad to see that 754 00:39:48,640 --> 00:39:51,200 Speaker 9: the tailors are in business. And lastly, okay, this from 755 00:39:51,239 --> 00:39:54,200 Speaker 9: the New York Post a sneaker collab between Nike and 756 00:39:54,280 --> 00:39:57,720 Speaker 9: of all places, Costco. It is sending the sneaker world 757 00:39:57,760 --> 00:40:01,480 Speaker 9: into a tizzy. So the sneaker collab it's called this 758 00:40:01,520 --> 00:40:04,759 Speaker 9: is a mouthful Nike s B dunk Low x Kirkland. 759 00:40:05,160 --> 00:40:09,800 Speaker 9: They're exclusive to Costco. Released in New York, Oregon, California, Washington. 760 00:40:09,880 --> 00:40:11,359 Speaker 9: So they were going for one hundred and thirty five 761 00:40:11,400 --> 00:40:15,839 Speaker 9: dollars in just three days. The resale market skyrocketed two 762 00:40:16,080 --> 00:40:18,640 Speaker 9: hundred percent. In some places, these sneakers are going for 763 00:40:18,719 --> 00:40:22,680 Speaker 9: one thousand bucks on places like eBay and stock x. 764 00:40:22,840 --> 00:40:25,800 Speaker 5: So it's a separate style for Costco. Yes, okay, exactly. 765 00:40:26,480 --> 00:40:29,160 Speaker 2: I saw Lisa Mateo wearing those. I think so. 766 00:40:29,239 --> 00:40:32,240 Speaker 9: I think hopefully she didn't spend a thousand bucks on them, 767 00:40:32,560 --> 00:40:36,080 Speaker 9: but so you know that. Also, the the insol it 768 00:40:36,160 --> 00:40:39,600 Speaker 9: features is kind of cute. It features the Costco Affordable 769 00:40:39,640 --> 00:40:42,360 Speaker 9: hot dogs, those famous hot dogs with the echo for 770 00:40:42,400 --> 00:40:44,560 Speaker 9: a buck fifty. So there's a picture of those on it, 771 00:40:44,600 --> 00:40:44,840 Speaker 9: and I. 772 00:40:45,000 --> 00:40:46,560 Speaker 5: See you cam look at it now. 773 00:40:46,800 --> 00:40:49,000 Speaker 4: Very interesting, all right, Yes, I mean it's not like 774 00:40:49,040 --> 00:40:52,680 Speaker 4: a crazy time, but people are people love it. 775 00:40:52,719 --> 00:40:53,680 Speaker 5: I guess I don't know. 776 00:40:54,120 --> 00:40:57,359 Speaker 2: Thank you so much. The newspapers today just brilliant. Lexus, Christopherus. 777 00:40:57,920 --> 00:41:02,759 Speaker 1: This is the Bloomberg Surveillance podst available on Apple, Spotify, 778 00:41:02,880 --> 00:41:06,680 Speaker 1: and anywhere else you get your podcasts. Listen live each 779 00:41:06,719 --> 00:41:10,520 Speaker 1: weekday seven to ten am Eastern on Bloomberg dot com, 780 00:41:10,680 --> 00:41:14,480 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 781 00:41:14,800 --> 00:41:17,880 Speaker 1: You can also watch us live every weekday on YouTube 782 00:41:18,200 --> 00:41:20,200 Speaker 1: and always on the Bloomberg terminal