1 00:00:09,880 --> 00:00:13,800 Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Daily 2 00:00:13,960 --> 00:00:17,560 Speaker 1: we bring you insight from the best in economics, finance, investment, 3 00:00:18,000 --> 00:00:23,480 Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,640 --> 00:00:27,400 Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg. The 5 00:00:27,560 --> 00:00:31,800 Speaker 1: uproar at Bloomberg today is off one article. Let me 6 00:00:31,840 --> 00:00:35,040 Speaker 1: look down at the terminal New York City landlords press 7 00:00:35,120 --> 00:00:39,559 Speaker 1: finance bosses to speed return in safe city. And as 8 00:00:39,560 --> 00:00:42,320 Speaker 1: I said to Anna Edwards in the simulcast a bit ago, 9 00:00:42,720 --> 00:00:45,080 Speaker 1: I heard the same story out of the city of London. 10 00:00:45,400 --> 00:00:47,800 Speaker 1: I think it was two or three weeks ago as well. 11 00:00:48,240 --> 00:00:52,199 Speaker 1: To give us perspective on this is Anthony Malkin of 12 00:00:52,360 --> 00:00:56,480 Speaker 1: Empire States Reality Trust. He's got a big fancy title. 13 00:00:56,560 --> 00:00:59,480 Speaker 1: Other than that, what you need to know is he 14 00:00:59,520 --> 00:01:02,960 Speaker 1: holds ordered five O one seventh Avenue at thirty seven 15 00:01:03,360 --> 00:01:06,920 Speaker 1: one Grand Central Place, at the Grand Central Terminal two 16 00:01:07,440 --> 00:01:11,960 Speaker 1: fifty West fifty seventh at Broadway. These are tangible properties 17 00:01:12,240 --> 00:01:16,920 Speaker 1: of his Empire State Reality Tony, what's the what's the 18 00:01:17,040 --> 00:01:21,040 Speaker 1: level of panic right now about the empty Midtown that 19 00:01:21,200 --> 00:01:24,160 Speaker 1: I observe? And I really don't think it's a. It's 20 00:01:24,160 --> 00:01:26,200 Speaker 1: a matter of panic. I think it's time for people 21 00:01:26,200 --> 00:01:28,240 Speaker 1: to get out of the Hampton's and get out of Aspen, 22 00:01:28,280 --> 00:01:30,360 Speaker 1: and get out of the mountains and show up to work. 23 00:01:30,760 --> 00:01:33,480 Speaker 1: The leaders who are very comfortable in their their their 24 00:01:33,520 --> 00:01:36,840 Speaker 1: country homes need to lead. People want to be back 25 00:01:36,880 --> 00:01:39,280 Speaker 1: at work. The young people want to be back at work. 26 00:01:39,600 --> 00:01:42,200 Speaker 1: It's a competitive advantage to those people who come back 27 00:01:42,280 --> 00:01:46,280 Speaker 1: to work. It's maybe an elitist thing. I take your 28 00:01:46,360 --> 00:01:50,000 Speaker 1: point on the fancy people are at the fancy properties 29 00:01:50,440 --> 00:01:53,800 Speaker 1: and the people that work for them, do they want 30 00:01:53,840 --> 00:01:56,000 Speaker 1: to go to the office as well or do they 31 00:01:56,040 --> 00:01:58,680 Speaker 1: want to be at home? You know, I think that 32 00:01:58,720 --> 00:02:01,400 Speaker 1: the whole issue of work from home, the death of 33 00:02:01,440 --> 00:02:05,600 Speaker 1: work from home, has been written Amazon, Facebook, smartest companies, 34 00:02:05,720 --> 00:02:09,119 Speaker 1: biggest companies have stated very clearly they're expanding, and they're 35 00:02:09,120 --> 00:02:12,080 Speaker 1: expanding in cities, are expanding in New York City. And 36 00:02:12,120 --> 00:02:16,320 Speaker 1: the fact of the matter is that you cannot understand 37 00:02:16,639 --> 00:02:21,080 Speaker 1: halloway validation what happens before the zoom after the zoom, 38 00:02:21,160 --> 00:02:24,080 Speaker 1: unless you're actually in the office. And I attended a 39 00:02:24,080 --> 00:02:26,160 Speaker 1: board meeting the public company on his board, I sit 40 00:02:26,280 --> 00:02:29,160 Speaker 1: in minny Apolais on Monday, and Tuesday last week. It's 41 00:02:29,200 --> 00:02:32,680 Speaker 1: so critical to be there. Uh and and in person, 42 00:02:33,040 --> 00:02:35,160 Speaker 1: you just don't get the world from the shoulders up 43 00:02:35,160 --> 00:02:38,000 Speaker 1: and in the length of the zoom call, it doesn't work. 44 00:02:38,440 --> 00:02:40,560 Speaker 1: What you can you can you can maintain and you 45 00:02:40,600 --> 00:02:43,200 Speaker 1: can sustain, but you cannot build and you cannot grow. 46 00:02:43,520 --> 00:02:45,680 Speaker 1: But the reality is Tony and you and I know 47 00:02:45,760 --> 00:02:49,360 Speaker 1: all the restaurants have frequent all your wonderful properties, those 48 00:02:49,400 --> 00:02:52,119 Speaker 1: restaurants have to be open. Essentially, they're not. I mean, 49 00:02:52,400 --> 00:02:55,840 Speaker 1: you can go down to Benoit on fifty fifth Street, 50 00:02:55,880 --> 00:02:58,880 Speaker 1: I think, and they've got their wonderful cafe outside and 51 00:02:58,919 --> 00:03:01,919 Speaker 1: do the French a faith thing Alan dukas, thank you. 52 00:03:02,200 --> 00:03:05,240 Speaker 1: Guess what you can't go in the restaurant. How critical 53 00:03:05,360 --> 00:03:08,320 Speaker 1: is it to link your opening of real estate to 54 00:03:08,480 --> 00:03:11,799 Speaker 1: their opening of restaurants. You know the fact is that 55 00:03:11,840 --> 00:03:13,800 Speaker 1: at the Empire State Building, for instance, we have a 56 00:03:13,840 --> 00:03:15,680 Speaker 1: lot of services, a lot of restaurants, a lot of 57 00:03:15,680 --> 00:03:19,000 Speaker 1: different food vendors. They will deliver two people's desks, they'll 58 00:03:19,040 --> 00:03:22,000 Speaker 1: deliver to their offices. People need to be there for 59 00:03:22,080 --> 00:03:24,760 Speaker 1: people to have the justification to open their stores and 60 00:03:24,919 --> 00:03:28,160 Speaker 1: open their doors and employ people and and it all 61 00:03:28,200 --> 00:03:31,359 Speaker 1: starts at the top. That's where it starts. And if 62 00:03:31,360 --> 00:03:35,040 Speaker 1: people are going to sit there, comfortable in there and 63 00:03:35,560 --> 00:03:38,360 Speaker 1: looking in there, I'm tired of zooms with people who 64 00:03:38,360 --> 00:03:41,280 Speaker 1: are in their beach homes getting delivered iced tea by 65 00:03:41,320 --> 00:03:44,440 Speaker 1: somebody who's off camera, you know, get to your desk. 66 00:03:45,960 --> 00:03:48,480 Speaker 1: I take I take your message on board, Anthony. I'm 67 00:03:48,520 --> 00:03:50,240 Speaker 1: not in New York. I'm not in the Hampton's Lam 68 00:03:50,320 --> 00:03:52,360 Speaker 1: in London, but I am in my house. And parts 69 00:03:52,400 --> 00:03:55,440 Speaker 1: of that is to do with and keeping occupancy of 70 00:03:55,440 --> 00:03:58,440 Speaker 1: office space down. It might be possible for some people 71 00:03:58,480 --> 00:04:00,840 Speaker 1: to go back to offices, but do you accept that 72 00:04:00,880 --> 00:04:02,560 Speaker 1: we're going to be in a sort of new normal 73 00:04:02,600 --> 00:04:05,760 Speaker 1: situation in some of these big world cities where not 74 00:04:05,880 --> 00:04:08,040 Speaker 1: everybody can go back at the same time. Not yet. 75 00:04:08,320 --> 00:04:11,520 Speaker 1: I think we've got four phases lockdown, pre therapy, vaccine, 76 00:04:11,560 --> 00:04:15,080 Speaker 1: post therapy vaccine, and then clean up and and replanting 77 00:04:15,080 --> 00:04:18,200 Speaker 1: the field, if you will. We're definitely in that phase 78 00:04:18,200 --> 00:04:20,400 Speaker 1: two right now, and we've got a ways to go 79 00:04:20,560 --> 00:04:23,520 Speaker 1: till we get to phase three. So there absolutely are 80 00:04:23,880 --> 00:04:28,080 Speaker 1: quote new temporary normals unquote, and we have to adjust 81 00:04:28,080 --> 00:04:32,560 Speaker 1: and address that. That said, if people will not lead, 82 00:04:32,800 --> 00:04:35,880 Speaker 1: people will not follow. And what really is interesting is 83 00:04:36,279 --> 00:04:39,400 Speaker 1: the young people today, ranging from their junior year in 84 00:04:39,440 --> 00:04:42,400 Speaker 1: high school to two years out of college, they will 85 00:04:42,480 --> 00:04:45,280 Speaker 1: follow those people who lead, and those people who sit 86 00:04:45,320 --> 00:04:48,640 Speaker 1: at home will remain at a competitive disadvantage from those 87 00:04:48,640 --> 00:04:51,279 Speaker 1: people who show up and work. So the bottom line is, hey, 88 00:04:51,320 --> 00:04:54,720 Speaker 1: look you need indoor environmental quality. It has been a 89 00:04:54,720 --> 00:04:57,279 Speaker 1: major factor of all of our work in the over 90 00:04:57,360 --> 00:05:00,240 Speaker 1: one billion dollars we've spent modernizing our PORTFOLI you in 91 00:05:00,279 --> 00:05:04,640 Speaker 1: New York City, making an energy efficient MERV third team filters, ventilation, 92 00:05:05,200 --> 00:05:09,040 Speaker 1: ion transfer, air purification. We have a benefit in our 93 00:05:09,080 --> 00:05:11,080 Speaker 1: buildings the fact that they are older, so they didn't 94 00:05:11,120 --> 00:05:14,960 Speaker 1: used to have centralized air conditioning systems. Consequently, fan rooms 95 00:05:14,960 --> 00:05:17,800 Speaker 1: are located per floor. You're not recirculating the air for 96 00:05:17,839 --> 00:05:21,320 Speaker 1: the entire building when you cooler heat and individual floor. 97 00:05:21,880 --> 00:05:24,480 Speaker 1: That said, you can make these changes. You can make 98 00:05:24,520 --> 00:05:28,279 Speaker 1: these adjustments, and people need to adjust and adapt. That's true. 99 00:05:28,560 --> 00:05:30,800 Speaker 1: That doesn't mean that you don't try and you don't start. 100 00:05:31,040 --> 00:05:33,960 Speaker 1: Those people who do are going to win. So, Anthony, 101 00:05:34,040 --> 00:05:36,240 Speaker 1: and what do you think people are afraid of? The 102 00:05:36,279 --> 00:05:38,479 Speaker 1: managers you say aren't coming back. Are they afraid of 103 00:05:38,480 --> 00:05:41,479 Speaker 1: the virus, or they're afraid of the legal system perhaps 104 00:05:41,520 --> 00:05:44,400 Speaker 1: and the legal implications of getting back bringing people back 105 00:05:44,440 --> 00:05:46,800 Speaker 1: if it isn't entirely safe. You know, you make a 106 00:05:46,800 --> 00:05:49,520 Speaker 1: really good point. This whole issue of liability capping is 107 00:05:49,520 --> 00:05:52,760 Speaker 1: so critical. You cannot take a look at let's say, 108 00:05:52,760 --> 00:05:54,719 Speaker 1: what happened in New York City and compared to what 109 00:05:54,839 --> 00:05:58,960 Speaker 1: happened in Miami. Miami happened several months after what happened 110 00:05:58,960 --> 00:06:01,080 Speaker 1: in New York City. The lessons learned in New York 111 00:06:01,080 --> 00:06:03,680 Speaker 1: City have helped everyone else in the world. Nobody's fault 112 00:06:03,680 --> 00:06:05,599 Speaker 1: that these things occurred when we didn't know what was 113 00:06:05,600 --> 00:06:07,960 Speaker 1: going on. Now that you do know what's going on, however, 114 00:06:07,960 --> 00:06:10,880 Speaker 1: you have to take prudent steps, wear a mask, have 115 00:06:11,040 --> 00:06:15,760 Speaker 1: your distancing, have your cleaning, do the appropriate measures. That said, 116 00:06:16,880 --> 00:06:20,440 Speaker 1: it is a matter where you can operate at the 117 00:06:20,839 --> 00:06:24,479 Speaker 1: occupancy which is allowable. We're operating at the Empire State 118 00:06:24,480 --> 00:06:28,240 Speaker 1: Building Observatory right now. We've got the same ventilation they're 119 00:06:28,279 --> 00:06:31,640 Speaker 1: depending upon the density that we planned for visitors there. 120 00:06:31,680 --> 00:06:33,960 Speaker 1: The fresh air comes into that space three to twenty 121 00:06:34,000 --> 00:06:36,800 Speaker 1: two times an hour, very quickly. Or Tony Malco and 122 00:06:36,920 --> 00:06:39,680 Speaker 1: last question, what portion of rents are not being paid. 123 00:06:40,200 --> 00:06:46,200 Speaker 1: So h in July we reported collection lower in retail 124 00:06:46,360 --> 00:06:50,240 Speaker 1: than in office. Very good, Tony Malcoln, thank you so much, 125 00:06:50,279 --> 00:06:52,760 Speaker 1: just really really love have you, and we'll do this 126 00:06:52,839 --> 00:06:56,360 Speaker 1: again soon with the Empire State Reality Trust. Mr Melkin, 127 00:06:56,400 --> 00:06:59,239 Speaker 1: of course part of New York City. I really can't 128 00:06:59,279 --> 00:07:05,360 Speaker 1: say enough about the Bloomberg article right now. We need 129 00:07:05,360 --> 00:07:08,520 Speaker 1: a clinic any equity market. We turn to Laurie Calvacina 130 00:07:08,839 --> 00:07:12,000 Speaker 1: of RBC Capital Markets, airhead of all of US equity 131 00:07:12,040 --> 00:07:14,480 Speaker 1: strategy as well. Laurie, what will you write about? What 132 00:07:14,560 --> 00:07:18,600 Speaker 1: will you frame from Monday morning? So look, I think 133 00:07:18,600 --> 00:07:21,080 Speaker 1: it's a quiet week. I think that there hasn't been 134 00:07:21,120 --> 00:07:23,200 Speaker 1: a ton of news, but the news that has come 135 00:07:23,200 --> 00:07:26,080 Speaker 1: out has moved markets, and I think what my takeaway 136 00:07:26,120 --> 00:07:27,960 Speaker 1: for the week so far is that there's still an 137 00:07:28,040 --> 00:07:31,200 Speaker 1: undercurrent of nervousness. I mean, arguably the Fed minutes really 138 00:07:31,200 --> 00:07:33,360 Speaker 1: shouldn't have rattled markets, and it's not like they rattled 139 00:07:33,360 --> 00:07:35,760 Speaker 1: them in a major way, but they did reveal that 140 00:07:35,840 --> 00:07:39,440 Speaker 1: there's still some underlying concern about this fork in the 141 00:07:39,480 --> 00:07:42,080 Speaker 1: road that the US economy seems to be at. Which 142 00:07:42,080 --> 00:07:44,239 Speaker 1: way are we going? Are we going? To start recovering 143 00:07:44,240 --> 00:07:46,200 Speaker 1: again after a bit of a plateau over the summer, 144 00:07:46,600 --> 00:07:48,640 Speaker 1: or are we going to take another leg down? And 145 00:07:48,680 --> 00:07:50,800 Speaker 1: I think markets are still concerned about that. We have 146 00:07:50,840 --> 00:07:54,360 Speaker 1: seen a reaffirmation this week, Lorie, of digital dominance. We 147 00:07:54,440 --> 00:07:56,560 Speaker 1: see it in any number of companies. We all know them, 148 00:07:56,600 --> 00:08:00,280 Speaker 1: Home Depot, Walmart, etcetera. Apple with the two trillion dollar 149 00:08:00,400 --> 00:08:04,920 Speaker 1: valuation as well. How do you do a strategy in 150 00:08:05,000 --> 00:08:10,400 Speaker 1: a time of big box digital dominance. So our call 151 00:08:10,520 --> 00:08:14,120 Speaker 1: has been not to chase all of the little individual moves, 152 00:08:14,120 --> 00:08:15,320 Speaker 1: and we think that we're going to see a lot 153 00:08:15,360 --> 00:08:18,360 Speaker 1: of volatility in terms of leadership at the style level, 154 00:08:18,440 --> 00:08:21,520 Speaker 1: at the sector level. UM. We're continuing to tell people 155 00:08:21,520 --> 00:08:24,120 Speaker 1: to stay balanced between things like growth and value. We're 156 00:08:24,160 --> 00:08:26,320 Speaker 1: neutral on the tech and T I M T space. 157 00:08:26,640 --> 00:08:29,960 Speaker 1: We fully understand what's driving it. And as well as 158 00:08:29,960 --> 00:08:33,160 Speaker 1: those big buck retailers that the work from home UM, 159 00:08:33,200 --> 00:08:35,840 Speaker 1: you know sort of quarantine type names. We get what's 160 00:08:35,880 --> 00:08:37,480 Speaker 1: going on there. But we think we're going to see 161 00:08:37,480 --> 00:08:39,000 Speaker 1: a lot of volatility, that this is going to be 162 00:08:39,040 --> 00:08:42,000 Speaker 1: a long, uneven recovery and you just need to buy 163 00:08:42,040 --> 00:08:44,560 Speaker 1: the best in the cyclical camp, the defensive camp, and 164 00:08:44,600 --> 00:08:47,280 Speaker 1: the longer term growth camp and not try to chase 165 00:08:47,320 --> 00:08:49,160 Speaker 1: all of these little individual moves because we think you'll 166 00:08:49,200 --> 00:08:52,840 Speaker 1: get whiplash. Wise, were as lowering good morning. Why do 167 00:08:52,960 --> 00:08:55,160 Speaker 1: you not have a moll positive view on small camps 168 00:08:55,200 --> 00:08:57,360 Speaker 1: If you think they're cheap, if you think they could 169 00:08:57,360 --> 00:08:58,880 Speaker 1: have the potential to capt up with some of those 170 00:08:58,920 --> 00:09:01,120 Speaker 1: big box moves, that's only talk me about that. And 171 00:09:01,120 --> 00:09:04,160 Speaker 1: if they're underowned and they and they like recoveries, why 172 00:09:04,200 --> 00:09:07,679 Speaker 1: not go more aggressively into the smaller camp. End. So 173 00:09:07,720 --> 00:09:10,319 Speaker 1: our call on small cap is very nuancedpace on your 174 00:09:10,320 --> 00:09:12,960 Speaker 1: time horizon. And you know, I think everybody on the 175 00:09:12,960 --> 00:09:15,439 Speaker 1: street likes to think of themselves as a long term investor, 176 00:09:15,480 --> 00:09:16,480 Speaker 1: but at the end of the day, a lot of 177 00:09:16,480 --> 00:09:18,600 Speaker 1: people aren't and can't really afford to be a lot 178 00:09:18,600 --> 00:09:20,720 Speaker 1: of people live in that kind of six months, next 179 00:09:20,760 --> 00:09:23,480 Speaker 1: few quarters, one year time horizon. If you're in that 180 00:09:23,520 --> 00:09:25,680 Speaker 1: six to twelve month time horizon, we think you should 181 00:09:25,679 --> 00:09:28,640 Speaker 1: stay neutral. Um, we think that the small caps are 182 00:09:28,720 --> 00:09:32,600 Speaker 1: giving you a historic valuation opportunity. That means said, we 183 00:09:32,679 --> 00:09:34,760 Speaker 1: do also think that they're functioning the way that they 184 00:09:34,800 --> 00:09:38,960 Speaker 1: typically function as cyclical expressions of confidence in the market. 185 00:09:39,080 --> 00:09:40,959 Speaker 1: So as we you know, as we think one of 186 00:09:40,960 --> 00:09:43,120 Speaker 1: the reasons, frankly, they haven't broken out in a bigger 187 00:09:43,160 --> 00:09:45,640 Speaker 1: way is that there are still all these doubts about 188 00:09:45,640 --> 00:09:48,520 Speaker 1: the near term trajectory of the economy. But if you 189 00:09:48,559 --> 00:09:50,120 Speaker 1: really are, in your heart of hearts, a three to 190 00:09:50,200 --> 00:09:52,360 Speaker 1: five year investor, and you can ignore the noise of 191 00:09:52,400 --> 00:09:54,120 Speaker 1: the next year, no, we will come out of this. 192 00:09:54,520 --> 00:09:57,520 Speaker 1: We know that valuations are back to tech bubble extremes, 193 00:09:57,520 --> 00:09:59,560 Speaker 1: and what I mean by that is that small caps 194 00:09:59,679 --> 00:10:02,920 Speaker 1: are historically cheap relative to large caps. So we think 195 00:10:02,920 --> 00:10:04,320 Speaker 1: you're going to be in a good place in this 196 00:10:04,440 --> 00:10:06,760 Speaker 1: trade on a three to five year view, but over 197 00:10:06,800 --> 00:10:09,199 Speaker 1: the next six to twelve months, our confidence level is 198 00:10:09,240 --> 00:10:10,959 Speaker 1: a bit lower, and so we want to be intellectually 199 00:10:10,960 --> 00:10:13,559 Speaker 1: honest about that. Okay, so you'd be a bit more cautious. 200 00:10:13,559 --> 00:10:15,800 Speaker 1: They're picking up on something you said earlier about the 201 00:10:15,800 --> 00:10:17,840 Speaker 1: fork in the road, and and it makes me wonder 202 00:10:17,840 --> 00:10:21,240 Speaker 1: whether actually what we're dealing with in the US is many, many, many, 203 00:10:21,280 --> 00:10:24,160 Speaker 1: many different forks. Because of the size of the economy 204 00:10:24,160 --> 00:10:27,319 Speaker 1: and the way that the coronavirus regulations are being implemented 205 00:10:27,440 --> 00:10:29,800 Speaker 1: rightly in a very localized fashion, and you can apply 206 00:10:29,880 --> 00:10:31,800 Speaker 1: this to Europe to some extent. If we don't see 207 00:10:31,840 --> 00:10:35,280 Speaker 1: big lockdowns, big statewide or big country wide lockdowns, if 208 00:10:35,280 --> 00:10:38,400 Speaker 1: they are more nuanced, more targeted, that's going to make 209 00:10:38,440 --> 00:10:40,880 Speaker 1: the job of of working out which fork in the 210 00:10:40,960 --> 00:10:42,600 Speaker 1: road is going to be taken here for the for 211 00:10:42,679 --> 00:10:45,040 Speaker 1: the big picture economy, that's going to make that really difficult. 212 00:10:45,840 --> 00:10:47,800 Speaker 1: I think that's true. And you know, we're all watching 213 00:10:47,800 --> 00:10:51,920 Speaker 1: this alternative high frequency economic data, things like the open table, 214 00:10:52,000 --> 00:10:55,560 Speaker 1: restaurant book games, flying trends, public transit activity, that sort 215 00:10:55,559 --> 00:10:57,280 Speaker 1: of stuff. And one of the things that we do 216 00:10:57,320 --> 00:10:59,120 Speaker 1: on my team is an addition to looking at it 217 00:10:59,120 --> 00:11:02,280 Speaker 1: at say US versus Europe, where we can, we try 218 00:11:02,320 --> 00:11:04,600 Speaker 1: to look at the different regions around the country. Within 219 00:11:04,600 --> 00:11:07,200 Speaker 1: the US, and we noticed over the summer, as the 220 00:11:07,200 --> 00:11:10,200 Speaker 1: case counts were rising in Texas and Arizona and Florida, 221 00:11:10,480 --> 00:11:13,360 Speaker 1: you were seeing different reactions and consumer confidence, you were 222 00:11:13,360 --> 00:11:17,120 Speaker 1: seeing different reactions in mobility and engagement. UM that the 223 00:11:17,160 --> 00:11:20,640 Speaker 1: trends were simply not uniform across region different regions of 224 00:11:20,640 --> 00:11:23,320 Speaker 1: the country. Oftentimes the you, the Northeast was looking a 225 00:11:23,320 --> 00:11:26,080 Speaker 1: bit better than some of these other hotspots. UM And 226 00:11:26,120 --> 00:11:28,920 Speaker 1: I think that makes it very very difficult. UM. But 227 00:11:29,000 --> 00:11:31,280 Speaker 1: at the end of the day, Um, what we're seeing 228 00:11:31,280 --> 00:11:33,880 Speaker 1: at the national level is the data has generally plateaued. 229 00:11:33,920 --> 00:11:36,000 Speaker 1: A few things are starting to perk up a little bit, 230 00:11:36,040 --> 00:11:38,280 Speaker 1: but a lot of stuff has stayed stalled. And that's 231 00:11:38,320 --> 00:11:40,920 Speaker 1: telling me this economy hasn't decided which way it wants 232 00:11:40,960 --> 00:11:44,080 Speaker 1: to head yet. Will we see M and A here 233 00:11:44,120 --> 00:11:47,120 Speaker 1: in the coming quarters simply because of a dearth of 234 00:11:47,160 --> 00:11:50,839 Speaker 1: revenue growth? I think you'll get M and A down 235 00:11:50,880 --> 00:11:52,679 Speaker 1: the road. Um. You know, one of the things our 236 00:11:52,720 --> 00:11:55,600 Speaker 1: industrial analyst Dean dre has talked about is just how 237 00:11:55,640 --> 00:11:58,280 Speaker 1: strong the balance sheets are of his companies, and he 238 00:11:58,320 --> 00:12:00,280 Speaker 1: thinks they'll have a lot of dry powdered down the 239 00:12:00,360 --> 00:12:04,520 Speaker 1: road once confidence returns to go out and do some deals. UM. 240 00:12:04,520 --> 00:12:06,880 Speaker 1: And I think that's probably a pretty true statement of 241 00:12:06,920 --> 00:12:09,320 Speaker 1: the broader market. UM. But I'll tell you tom As 242 00:12:09,360 --> 00:12:12,000 Speaker 1: I went through the transcripts of this last reporting season, 243 00:12:12,000 --> 00:12:14,240 Speaker 1: one thing that really struck me was that companies, when 244 00:12:14,280 --> 00:12:16,920 Speaker 1: they were giving guidance, we're giving you a quarter's worth, 245 00:12:17,000 --> 00:12:20,319 Speaker 1: not generally anything more than that. Um. And also, you know, 246 00:12:20,320 --> 00:12:22,040 Speaker 1: there are a lot of companies that said, hey, things 247 00:12:22,040 --> 00:12:24,520 Speaker 1: are better in June and July, but still had a 248 00:12:24,520 --> 00:12:27,440 Speaker 1: cautious tone about the longer term outlook. So that's telling 249 00:12:27,480 --> 00:12:29,880 Speaker 1: me they're going to keep that dry, that powder dry 250 00:12:29,920 --> 00:12:31,720 Speaker 1: for a little bit longer. I mean, I'm glad you 251 00:12:31,760 --> 00:12:34,559 Speaker 1: mentioned Dean Dre. He's just wonderful on Honeywell and on 252 00:12:34,640 --> 00:12:37,960 Speaker 1: the other great industrials and what i'd almost call multinational 253 00:12:38,600 --> 00:12:41,959 Speaker 1: industrials as well. I know you can't talk individual stocks, 254 00:12:41,960 --> 00:12:45,719 Speaker 1: but what does Mr Dre tell you about the confidence 255 00:12:45,880 --> 00:12:49,080 Speaker 1: of these executives? You know what I what I think 256 00:12:49,120 --> 00:12:52,440 Speaker 1: we've heard on the industrial side is that the trade war, 257 00:12:52,920 --> 00:12:55,160 Speaker 1: you know it really was was was a great sort 258 00:12:55,160 --> 00:12:58,160 Speaker 1: of test run for this not intentionally, obviously nobody saw 259 00:12:58,200 --> 00:13:01,400 Speaker 1: this coming. But these companies are really focused on cost cutting, 260 00:13:01,400 --> 00:13:04,640 Speaker 1: They're really focused on margins, they're trying to defend the dividends. 261 00:13:04,800 --> 00:13:07,559 Speaker 1: They're really in a good place to weather this pandemic. 262 00:13:07,600 --> 00:13:09,440 Speaker 1: And that's really, you know, what I've seen in my work, 263 00:13:09,440 --> 00:13:11,320 Speaker 1: That's also what I've been hearing from Dean and some 264 00:13:11,400 --> 00:13:14,320 Speaker 1: of our other industrial analysts. And I'm actually overweight the 265 00:13:14,320 --> 00:13:17,200 Speaker 1: industrial sector while I have, you know, an expectation that 266 00:13:17,240 --> 00:13:18,800 Speaker 1: this market is going to give back some of the 267 00:13:18,800 --> 00:13:20,760 Speaker 1: games in the final few months of the year, and 268 00:13:20,800 --> 00:13:24,640 Speaker 1: I don't want to be holy encyclicals right now. Industrials 269 00:13:24,720 --> 00:13:27,319 Speaker 1: is the one spot in cyclicals that I'm really comfortable 270 00:13:27,400 --> 00:13:30,080 Speaker 1: leaning into at the sector level. Laurie Calvacina, thank you 271 00:13:30,160 --> 00:13:38,800 Speaker 1: so much. With RBC Capital Markets, there's a really great 272 00:13:39,320 --> 00:13:44,360 Speaker 1: indecision about where we're heading on inflation and particularly on 273 00:13:44,400 --> 00:13:48,120 Speaker 1: the general economy. Kathy Jones studies this. She has a 274 00:13:48,160 --> 00:13:51,000 Speaker 1: great joy of working with Lizzie Sanders at Charles Schwab. 275 00:13:51,200 --> 00:13:54,320 Speaker 1: It's arguably the best flow team on the street. Kathy, 276 00:13:54,720 --> 00:13:56,880 Speaker 1: question I'd ask liz Anne, let me ask you to 277 00:13:57,000 --> 00:14:01,319 Speaker 1: you as well. Schwab sees the flow of money nobody. 278 00:14:01,360 --> 00:14:05,000 Speaker 1: What are you seeing right now among Schwab clients? Are 279 00:14:05,000 --> 00:14:09,400 Speaker 1: they in the markets? Yeah? Absolutely, Um. I think our 280 00:14:09,480 --> 00:14:12,880 Speaker 1: clients have learned the lesson of hanging in there after 281 00:14:13,000 --> 00:14:15,800 Speaker 1: the ups and downs of the markets. Uh. You know, 282 00:14:15,880 --> 00:14:18,280 Speaker 1: there's there's a lot of different clients, so each has 283 00:14:18,320 --> 00:14:21,800 Speaker 1: a different kind of view, but in general, our clients 284 00:14:21,880 --> 00:14:25,080 Speaker 1: have stayed in. We didn't see a big exodus when 285 00:14:25,160 --> 00:14:29,040 Speaker 1: the economy declined, and we've actually seen clients come back 286 00:14:29,200 --> 00:14:32,600 Speaker 1: and uh and increase their positions as the markets improved. 287 00:14:32,800 --> 00:14:37,400 Speaker 1: What is your general yield prediction given the worries this 288 00:14:37,480 --> 00:14:42,920 Speaker 1: morning over future aggregate demand. Yeah, so we've been saying 289 00:14:42,960 --> 00:14:45,080 Speaker 1: since the beginning of the year that we thought that 290 00:14:45,240 --> 00:14:48,040 Speaker 1: well actually since the pandemic hit, that we thought the 291 00:14:48,160 --> 00:14:52,240 Speaker 1: tenure yield would stay in a fifty two five hundred 292 00:14:52,240 --> 00:14:55,560 Speaker 1: basis point range this year. We're looking for a continued 293 00:14:55,600 --> 00:14:58,560 Speaker 1: improvement in the economy, but the pace will probably slow 294 00:14:58,640 --> 00:15:01,760 Speaker 1: down now that we've had this as quick rebound, and 295 00:15:01,800 --> 00:15:04,240 Speaker 1: we think that that puts a lid on the upper 296 00:15:04,360 --> 00:15:08,280 Speaker 1: end of yields. But with the improvement in the economy, 297 00:15:08,360 --> 00:15:11,240 Speaker 1: even to a small extent, or even if we continue 298 00:15:11,280 --> 00:15:15,560 Speaker 1: to kind of roll along here, should hold tenure yields 299 00:15:15,560 --> 00:15:18,520 Speaker 1: around fifty basis points. And of course the short end 300 00:15:18,560 --> 00:15:22,040 Speaker 1: is completely anchored by the fed um near zero, so 301 00:15:22,080 --> 00:15:25,480 Speaker 1: there's not going to be a lot of play there. Kathy, 302 00:15:25,520 --> 00:15:27,880 Speaker 1: good to speak to you Anna in London. Let me 303 00:15:28,040 --> 00:15:30,520 Speaker 1: go into the minutes. We're just getting through from the ECB, 304 00:15:30,760 --> 00:15:33,800 Speaker 1: just dropping across the bloomberg right now. They talk about 305 00:15:33,840 --> 00:15:36,840 Speaker 1: positive market developments not being fully backed by data. Let's 306 00:15:36,840 --> 00:15:38,720 Speaker 1: remember this is for July. This is the minutes of 307 00:15:38,720 --> 00:15:41,600 Speaker 1: the fift to the sixteenth of July. But something catches 308 00:15:41,640 --> 00:15:43,720 Speaker 1: my eye at Kathy, and that is what they're saying 309 00:15:44,040 --> 00:15:46,680 Speaker 1: around the PEP, and that's the plan that the ECB 310 00:15:46,800 --> 00:15:49,440 Speaker 1: put in place, of course, to to buy up assets. 311 00:15:49,480 --> 00:15:52,480 Speaker 1: Some said in the minutes that the pet envelope should 312 00:15:52,480 --> 00:15:55,240 Speaker 1: be a ceiling, not a target, and I wonder if 313 00:15:55,280 --> 00:15:57,680 Speaker 1: that will lead some to conclude that maybe the ECB 314 00:15:57,880 --> 00:16:00,960 Speaker 1: isn't about to increase the amount of money it puts 315 00:16:00,960 --> 00:16:03,080 Speaker 1: into the PEP in the future. What are you expecting 316 00:16:03,120 --> 00:16:05,440 Speaker 1: to see. Um, I think that that's still going to 317 00:16:05,520 --> 00:16:08,040 Speaker 1: be somewhat flexible. You know, in the ECB you have 318 00:16:08,200 --> 00:16:12,080 Speaker 1: different different factions there, and I think probably that statement, 319 00:16:12,360 --> 00:16:14,040 Speaker 1: off the top of my head sounds like they're trying 320 00:16:14,080 --> 00:16:17,440 Speaker 1: to satisfy different different factions within the e c B. 321 00:16:18,080 --> 00:16:21,240 Speaker 1: But I do think that they're still under Christie regard this, 322 00:16:21,440 --> 00:16:26,280 Speaker 1: you know, the continuation of the draggy whatever it takes philosophy. 323 00:16:26,400 --> 00:16:29,320 Speaker 1: So if they have to increase, they will increase. But 324 00:16:30,120 --> 00:16:32,560 Speaker 1: in the short run that probably sends a little bit 325 00:16:32,600 --> 00:16:35,440 Speaker 1: of a signal that will firm up the Euro if 326 00:16:35,480 --> 00:16:38,120 Speaker 1: people believe there is a ceiling on it. Yeah. They're 327 00:16:38,160 --> 00:16:41,240 Speaker 1: also saying that they expect more clarity about inflation and 328 00:16:41,280 --> 00:16:43,800 Speaker 1: the outlook for that in September. They'll have plenty more 329 00:16:43,920 --> 00:16:47,040 Speaker 1: data to play with in September when it comes to that. 330 00:16:47,120 --> 00:16:50,280 Speaker 1: The global conversation that seems to be going on around inflation, Kathy, 331 00:16:50,360 --> 00:16:52,400 Speaker 1: if we can, if we can talk globally about inflation. 332 00:16:52,440 --> 00:16:55,160 Speaker 1: I know these things are much more nuanced and geographical, 333 00:16:55,240 --> 00:16:58,280 Speaker 1: but in general terms, we spent many years with central 334 00:16:58,280 --> 00:17:01,920 Speaker 1: banks struggling to get inflation ray to meet their targets 335 00:17:01,960 --> 00:17:05,120 Speaker 1: in developed markets. This is going to be even more 336 00:17:05,119 --> 00:17:07,800 Speaker 1: difficult now, isn't it, with unemployment rates as high as 337 00:17:07,840 --> 00:17:09,480 Speaker 1: they are, or as high as they're going to be. 338 00:17:09,760 --> 00:17:12,840 Speaker 1: So where do you see the inflation and narrative gemming? Yeah, 339 00:17:12,880 --> 00:17:14,960 Speaker 1: I think it's gonna be a real struggle. We've got 340 00:17:15,000 --> 00:17:18,720 Speaker 1: several years here before we close those output gaps, we 341 00:17:18,760 --> 00:17:21,680 Speaker 1: get unemployment rates down, we get wages up, and enough 342 00:17:21,760 --> 00:17:24,880 Speaker 1: that you have, you know, enough money in people's pockets 343 00:17:24,880 --> 00:17:27,639 Speaker 1: to fuel some inflation. It's going to take a couple 344 00:17:27,680 --> 00:17:30,480 Speaker 1: of years. But I'm not in the doom and gloom 345 00:17:30,600 --> 00:17:34,840 Speaker 1: sort of a deflation camp. I think the abundant liquidity 346 00:17:34,920 --> 00:17:37,359 Speaker 1: and the efforts of the central banks will mean that 347 00:17:37,400 --> 00:17:40,040 Speaker 1: we will gradually see a little bit better inflation. But 348 00:17:40,080 --> 00:17:44,240 Speaker 1: it's gonna take time because we doubled into unemployment and 349 00:17:44,359 --> 00:17:47,000 Speaker 1: on all of the damage that's been done to the 350 00:17:47,080 --> 00:17:50,639 Speaker 1: major developed economies economies around the world. It's going to 351 00:17:50,760 --> 00:17:53,000 Speaker 1: take some time. The kitty, you know, we just had 352 00:17:53,080 --> 00:17:55,960 Speaker 1: launched time. I'm Bloomberg, folks. This is an incredibly important 353 00:17:56,000 --> 00:17:59,680 Speaker 1: story and I'll get it out shoot Nagina Natalie Wong 354 00:18:00,440 --> 00:18:04,520 Speaker 1: on the real estate and the emptiness of our big cities. 355 00:18:04,560 --> 00:18:07,679 Speaker 1: The article focuses on New York City, but in Edwards. 356 00:18:07,680 --> 00:18:10,199 Speaker 1: To be honest, I saw a like article on London 357 00:18:10,240 --> 00:18:13,600 Speaker 1: a couple of weeks ago as well. Kathy Jones to Schwab, 358 00:18:13,720 --> 00:18:17,240 Speaker 1: just assume that there will be a lower g d 359 00:18:17,480 --> 00:18:20,080 Speaker 1: P number and that the level we get back to 360 00:18:20,800 --> 00:18:25,520 Speaker 1: could even be sub two real g d P. No, 361 00:18:25,680 --> 00:18:28,560 Speaker 1: I don't think we're assuming that at all. Um. You know, 362 00:18:28,760 --> 00:18:31,600 Speaker 1: we do know that there are structural changes taking place. 363 00:18:31,720 --> 00:18:34,640 Speaker 1: So a commercial real estate is certainly an area where 364 00:18:34,680 --> 00:18:37,240 Speaker 1: a lot of questions as to how that's going to evolve. 365 00:18:37,840 --> 00:18:41,480 Speaker 1: But I really take on more optimistic view of things. 366 00:18:41,560 --> 00:18:44,160 Speaker 1: If you look at how anxious people are to get 367 00:18:44,200 --> 00:18:47,680 Speaker 1: back to their quote unquote normal lives. What you see 368 00:18:47,720 --> 00:18:50,919 Speaker 1: is they're willing to risk their health and well being 369 00:18:51,040 --> 00:18:53,000 Speaker 1: in order to just go to a bar or have 370 00:18:53,080 --> 00:18:56,080 Speaker 1: a party or go to the gym. Um, I'm actually 371 00:18:56,600 --> 00:19:01,480 Speaker 1: fairly optimistic about the resilience of the major economies once 372 00:19:01,600 --> 00:19:04,120 Speaker 1: once we get further down the road. Obviously a vaccine 373 00:19:04,160 --> 00:19:07,240 Speaker 1: would be a huge game changer, but I don't assume 374 00:19:07,800 --> 00:19:10,600 Speaker 1: that we necessarily go to a lower level of economic 375 00:19:10,640 --> 00:19:13,399 Speaker 1: activity below two percent going forward. I think we can 376 00:19:13,400 --> 00:19:14,920 Speaker 1: get back to that two to two and a half 377 00:19:14,960 --> 00:19:16,879 Speaker 1: percent area. I don't know that we can go be 378 00:19:16,880 --> 00:19:20,120 Speaker 1: a pond differ. Well, that's yield up at some point, 379 00:19:20,240 --> 00:19:22,879 Speaker 1: that's yield up priced down. How do you protect on 380 00:19:22,960 --> 00:19:27,120 Speaker 1: price erosion on fixed income? Well, right now, we're keeping 381 00:19:27,200 --> 00:19:30,280 Speaker 1: duration a little bit short of average or whatever the 382 00:19:30,320 --> 00:19:32,960 Speaker 1: benchmark is. So if you take the egg the benchmark, 383 00:19:33,720 --> 00:19:36,320 Speaker 1: it's around six or seven. Right now, we'd keep it 384 00:19:36,359 --> 00:19:38,800 Speaker 1: a little bit shorter because the risk reward at the 385 00:19:38,880 --> 00:19:42,280 Speaker 1: long end just isn't that great unless you have a 386 00:19:42,400 --> 00:19:46,320 Speaker 1: very deflationary outlook, which we don't have. So we're keeping 387 00:19:46,400 --> 00:19:50,639 Speaker 1: duration a little bit short. Um, we like high quality credit, 388 00:19:50,720 --> 00:19:54,200 Speaker 1: you know, I investment grade credit. You can actually take 389 00:19:54,240 --> 00:19:57,040 Speaker 1: some duration there and get a bit more yield, and 390 00:19:57,119 --> 00:19:59,720 Speaker 1: you can venture out into some of the riskier segments 391 00:19:59,720 --> 00:20:02,399 Speaker 1: of them market if you have the risk appetite for 392 00:20:02,440 --> 00:20:06,760 Speaker 1: a little bit um and get some duration plus yield there. Yeah. 393 00:20:06,800 --> 00:20:08,720 Speaker 1: What is appetite like for some of the new issuance 394 00:20:08,800 --> 00:20:11,639 Speaker 1: we've seen coming through Kathy from the corporate world in 395 00:20:12,080 --> 00:20:14,280 Speaker 1: in the US, and I'm thinking of investment grade. I 396 00:20:14,320 --> 00:20:16,480 Speaker 1: was looking at a chant that showed issue instead of 397 00:20:16,560 --> 00:20:18,800 Speaker 1: record for the year, and that was on Monday, So 398 00:20:18,960 --> 00:20:22,880 Speaker 1: midway through August, we've already reached a full year record 399 00:20:22,920 --> 00:20:25,560 Speaker 1: on on corporate issues. Is there still the appetite and 400 00:20:25,600 --> 00:20:28,520 Speaker 1: the market still soaked this up? Oh? I think so. Um, 401 00:20:28,560 --> 00:20:31,879 Speaker 1: if you look at the issue that Apple did a 402 00:20:31,920 --> 00:20:35,800 Speaker 1: little while ago. Um, I think investment grade will find 403 00:20:35,960 --> 00:20:38,840 Speaker 1: very strong appetite. You know, have the support programs from 404 00:20:38,840 --> 00:20:41,400 Speaker 1: the FED. We know the FED has been buying some 405 00:20:41,480 --> 00:20:44,800 Speaker 1: investment grade. You can't get a lot of yield anywhere, 406 00:20:44,960 --> 00:20:48,119 Speaker 1: and um, when you're up in credit quality, there's just 407 00:20:48,240 --> 00:20:51,840 Speaker 1: tremendous demand for some sort of yield out there. And 408 00:20:52,000 --> 00:20:55,560 Speaker 1: I g definitely satisfies that. Kathy, thank you so much, 409 00:20:55,600 --> 00:21:01,800 Speaker 1: Kathy Jones and rush So I greatly appreciated. What we 410 00:21:01,840 --> 00:21:04,760 Speaker 1: know for certain is that the gentleman from Delaware has 411 00:21:04,800 --> 00:21:09,600 Speaker 1: to go out and find disaffected Republicans. That's happened before, 412 00:21:10,080 --> 00:21:14,359 Speaker 1: including the disaffected Republican Dean family of years ago, where 413 00:21:14,359 --> 00:21:17,800 Speaker 1: Howard Dean wandered from GOP over to the Democratic Party 414 00:21:18,119 --> 00:21:20,920 Speaker 1: and had a sterling career in Vermont and wandered out 415 00:21:20,960 --> 00:21:23,920 Speaker 1: as a presidential candidate just a few years ago. We're 416 00:21:23,920 --> 00:21:26,480 Speaker 1: thrilled that Howard Dean could join us this morning. The 417 00:21:26,560 --> 00:21:30,680 Speaker 1: former d n C chair, Howard the vice president, has 418 00:21:30,760 --> 00:21:35,000 Speaker 1: to go out and find disaffected Republicans. How does he 419 00:21:35,080 --> 00:21:37,639 Speaker 1: do that? Actually he doesn't. He's going to do that, 420 00:21:37,680 --> 00:21:39,360 Speaker 1: but he doesn't. All he has to do is get 421 00:21:39,359 --> 00:21:41,800 Speaker 1: a bigger turn out than we had in two thousand sixteen. 422 00:21:41,840 --> 00:21:43,680 Speaker 1: And I think they're well on their way to doing that. 423 00:21:44,080 --> 00:21:48,480 Speaker 1: But this is a convention that is aimed at Republicans. 424 00:21:48,520 --> 00:21:51,359 Speaker 1: You just want to see honesty back in our government. Uh. 425 00:21:51,480 --> 00:21:54,280 Speaker 1: And that's why you had two or three pretty big 426 00:21:54,359 --> 00:21:57,960 Speaker 1: Republican figures, Guy John Kasey, Cindy McCain, and Colin Powell 427 00:21:58,480 --> 00:22:03,680 Speaker 1: basically giving permission for disaffected Republicans to vote for Joe Biden. Uh. 428 00:22:04,520 --> 00:22:06,760 Speaker 1: This is a good job that I don't think conventions 429 00:22:06,760 --> 00:22:08,520 Speaker 1: are ever going to go back to the way they work. 430 00:22:08,920 --> 00:22:12,320 Speaker 1: This convention has been very effective with this format, and 431 00:22:12,320 --> 00:22:16,359 Speaker 1: it's obviously much less expensive and much easier logistically. What 432 00:22:16,560 --> 00:22:20,800 Speaker 1: happens when these two odd conventions are over, how do 433 00:22:20,920 --> 00:22:24,479 Speaker 1: the Democrats move forward to get the vote out and 434 00:22:24,520 --> 00:22:28,640 Speaker 1: to get those independence and disaffected Republicans. Well, that's why 435 00:22:28,640 --> 00:22:31,560 Speaker 1: you're seeing so much hassle about the male system and 436 00:22:31,680 --> 00:22:35,679 Speaker 1: Trump's attempt to disrupt the mail. Uh, it's clearly going 437 00:22:35,720 --> 00:22:38,240 Speaker 1: to be mail ballots. In Vermont, we had the largest 438 00:22:38,280 --> 00:22:41,600 Speaker 1: turnout in the history of the primary. The primary vote 439 00:22:41,680 --> 00:22:46,359 Speaker 1: was up something like over the previous record of primary voters. 440 00:22:46,400 --> 00:22:49,199 Speaker 1: That's just unheard of. Uh. And I think you know, 441 00:22:49,520 --> 00:22:52,760 Speaker 1: voting by mail is convenient, people like it. Five states, 442 00:22:52,800 --> 00:22:55,760 Speaker 1: including Utah and Oregon, both at the opposite ends of 443 00:22:55,800 --> 00:22:58,400 Speaker 1: the political polls, have been doing this for a while 444 00:22:58,440 --> 00:23:01,119 Speaker 1: and it's very successful in people like it regardless of 445 00:23:01,200 --> 00:23:04,040 Speaker 1: their party. So that's going to be a critical key. 446 00:23:04,359 --> 00:23:07,639 Speaker 1: Has have the post office run and function properly and 447 00:23:07,640 --> 00:23:09,879 Speaker 1: that's a big get out of the vote tool. How 448 00:23:10,400 --> 00:23:12,639 Speaker 1: is it easier to vote by posts than vote in 449 00:23:12,720 --> 00:23:15,440 Speaker 1: person as far, well, it's much easier in the COVID 450 00:23:15,480 --> 00:23:17,879 Speaker 1: epidemic where you have to worry about getting you know, 451 00:23:18,000 --> 00:23:22,639 Speaker 1: pretty serious medical problem. And uh and it's always been 452 00:23:22,680 --> 00:23:26,320 Speaker 1: a problem, and more so recently voting machines. The voting 453 00:23:26,320 --> 00:23:30,000 Speaker 1: machine technology really doesn't work in this country because they've 454 00:23:30,040 --> 00:23:33,199 Speaker 1: adopted a system that you can't really recount it. You 455 00:23:33,240 --> 00:23:35,760 Speaker 1: just keep staring at the numbers. That's that's the recount. 456 00:23:36,400 --> 00:23:39,840 Speaker 1: Now there's some states that don't use that technology that 457 00:23:39,880 --> 00:23:42,320 Speaker 1: you can actually see ballots that get counted by the machine, 458 00:23:42,320 --> 00:23:44,439 Speaker 1: which is the right way to go. So voting in 459 00:23:44,440 --> 00:23:46,680 Speaker 1: this country has been a big problem since about two 460 00:23:46,680 --> 00:23:50,720 Speaker 1: thousand with a very controversial Bush versus Score court case, 461 00:23:50,760 --> 00:23:53,280 Speaker 1: and we need to do much better there. What is 462 00:23:53,320 --> 00:23:55,560 Speaker 1: the message that the Democrats should do not to make 463 00:23:55,600 --> 00:23:58,119 Speaker 1: sure that people just turn out and vote. How do 464 00:23:58,119 --> 00:24:01,560 Speaker 1: you energize people? It's pretty well, you know, Trump is 465 00:24:01,640 --> 00:24:05,880 Speaker 1: the interget I mean most most inner interim elections when 466 00:24:05,880 --> 00:24:07,960 Speaker 1: a president's running for re election is about as a 467 00:24:08,040 --> 00:24:11,359 Speaker 1: referendum on the president. So Trump is our best weapon 468 00:24:11,760 --> 00:24:15,199 Speaker 1: Trump is incredibly destructive. He's certainly the most dishonest president 469 00:24:15,200 --> 00:24:17,680 Speaker 1: we've ever had, and going back over the years, that's 470 00:24:17,760 --> 00:24:21,480 Speaker 1: quite a statement to make. So people are first they're 471 00:24:21,480 --> 00:24:23,600 Speaker 1: gonna go out and vote against Trump. Second of all, 472 00:24:23,640 --> 00:24:25,720 Speaker 1: they do want decency. One of the great things about 473 00:24:25,760 --> 00:24:29,200 Speaker 1: Biden's candidacy, even though he's seventy eight years old and 474 00:24:29,240 --> 00:24:31,600 Speaker 1: all this stuff, is he's a decent guy and he 475 00:24:31,680 --> 00:24:34,879 Speaker 1: does listen to people. He has empathy, which Trump completely lacked. 476 00:24:35,359 --> 00:24:38,680 Speaker 1: So there's gonna be a huge contrast between the personal styles. 477 00:24:38,760 --> 00:24:41,080 Speaker 1: And I know we all talked about issues and what 478 00:24:41,119 --> 00:24:43,680 Speaker 1: people are gonna do with the real issue is always 479 00:24:44,080 --> 00:24:46,760 Speaker 1: does this person care about people like me and Joe 480 00:24:46,760 --> 00:24:49,879 Speaker 1: Biden does and Trump doesn't. Where do you sit Dr 481 00:24:49,960 --> 00:24:53,600 Speaker 1: Dean with the idea of shocking the nation in October 482 00:24:54,160 --> 00:24:57,240 Speaker 1: into the third week of October by starting to announce 483 00:24:57,320 --> 00:25:01,120 Speaker 1: cabinet members. If this is a president Biden who has 484 00:25:01,200 --> 00:25:05,560 Speaker 1: to delegate authority for whatever the reasons, can he like 485 00:25:05,680 --> 00:25:08,800 Speaker 1: tear up the political playbook and say so and so 486 00:25:08,920 --> 00:25:11,480 Speaker 1: will be my Secretary State, so and so will be 487 00:25:11,520 --> 00:25:15,280 Speaker 1: my Secretary Treasury. That's controversial. I thought about that when 488 00:25:15,320 --> 00:25:19,200 Speaker 1: I was running. The reason people don't do it, I 489 00:25:19,240 --> 00:25:24,280 Speaker 1: think is because, um, there's some concern that if you 490 00:25:24,400 --> 00:25:28,120 Speaker 1: do that, it appears that you're trading your your cabinet 491 00:25:28,119 --> 00:25:32,680 Speaker 1: appointment for a for support. And you know, I've I've 492 00:25:32,680 --> 00:25:35,199 Speaker 1: always heard this. We thought about doing it ourselves. That 493 00:25:35,240 --> 00:25:38,520 Speaker 1: was an explanation I got from a lawyer. Uh So 494 00:25:38,600 --> 00:25:40,600 Speaker 1: that I think may have something to do with the 495 00:25:40,600 --> 00:25:43,280 Speaker 1: fact that candidates just don't do that. What is the 496 00:25:43,320 --> 00:25:47,720 Speaker 1: best process for the vice president when he debates President Trump? 497 00:25:47,920 --> 00:25:51,560 Speaker 1: We always saw the debate of of Trump Clinton. How 498 00:25:51,600 --> 00:25:55,639 Speaker 1: should Biden debate the sitting president? He just needs to 499 00:25:55,640 --> 00:25:57,600 Speaker 1: be himself. Trump will get out there and say all 500 00:25:57,680 --> 00:26:01,520 Speaker 1: kinds of Atlantish things about conspiracy theories and drinking bleach 501 00:26:01,600 --> 00:26:05,320 Speaker 1: and god knows what else, and Biden testing himself for 502 00:26:05,400 --> 00:26:08,399 Speaker 1: whatever Biden's position on the political spectrum, and he's probably 503 00:26:08,400 --> 00:26:11,400 Speaker 1: more conservative than I am. Um, he's just a good 504 00:26:11,400 --> 00:26:14,240 Speaker 1: guy and just people would like to have a normal 505 00:26:14,320 --> 00:26:17,840 Speaker 1: president again after this four years of reality television. So 506 00:26:17,880 --> 00:26:20,280 Speaker 1: he just has to be himself. And if he makes 507 00:26:20,280 --> 00:26:23,119 Speaker 1: a flub or says something you know that's uh, you know, 508 00:26:23,280 --> 00:26:26,040 Speaker 1: that's out of line and out of whack. He's been 509 00:26:26,040 --> 00:26:28,760 Speaker 1: doing that for thirty five years. He's just just makes 510 00:26:28,800 --> 00:26:31,480 Speaker 1: him more human. But Howardina, I also keep on reading 511 00:26:31,560 --> 00:26:33,520 Speaker 1: and that actually that there's a lot more googling on 512 00:26:33,600 --> 00:26:36,639 Speaker 1: conspiracy theories. I think we had a story, um you know, 513 00:26:36,640 --> 00:26:38,800 Speaker 1: on Q and On and the fact that President Trump 514 00:26:38,880 --> 00:26:42,719 Speaker 1: didn't say it was nonsense. Does it really you know, 515 00:26:42,800 --> 00:26:45,560 Speaker 1: is it really you know taking ground in the US? 516 00:26:45,600 --> 00:26:48,480 Speaker 1: Are a lot more people, um, you know, believing in 517 00:26:48,520 --> 00:26:51,640 Speaker 1: conspiracy theories or is it just still a very small part. Well, 518 00:26:51,640 --> 00:26:53,440 Speaker 1: it's a small part, but it's a lot more people 519 00:26:53,480 --> 00:26:56,480 Speaker 1: than it was. Because Trump floats these conspiracy theories and 520 00:26:56,520 --> 00:26:59,280 Speaker 1: then Q and on, look, he has he has energized 521 00:26:59,320 --> 00:27:02,640 Speaker 1: that what I would call the crackpot, right, um and 522 00:27:02,640 --> 00:27:05,119 Speaker 1: and it's a problem. And because people do believe this 523 00:27:05,200 --> 00:27:07,840 Speaker 1: kind of stuff. I mean we did, we seriously did 524 00:27:07,880 --> 00:27:10,960 Speaker 1: have two Americans who died because they drank a swimming 525 00:27:10,960 --> 00:27:14,760 Speaker 1: pool cleaner because Trump apparently recommended that that was how 526 00:27:14,800 --> 00:27:18,919 Speaker 1: you're gonna get rid of coronavirus. I mean, really, you know, 527 00:27:19,080 --> 00:27:20,920 Speaker 1: I hate to say that, I think I don't hate 528 00:27:20,920 --> 00:27:23,159 Speaker 1: to say it's true. I think Trump is crazy. I 529 00:27:23,200 --> 00:27:25,760 Speaker 1: really do think he's mentally unbalanced, and he's been mentally 530 00:27:25,800 --> 00:27:28,919 Speaker 1: imbalanced most of his life. Dr Dean, we didn't have 531 00:27:28,960 --> 00:27:30,720 Speaker 1: you on to talk politics. We need to get some 532 00:27:30,800 --> 00:27:33,919 Speaker 1: medicine out of the way here. Right now. We have 533 00:27:34,000 --> 00:27:38,200 Speaker 1: a new solution for this virus. It is a derivative 534 00:27:38,240 --> 00:27:42,119 Speaker 1: called oleander her oleand rin whatever it is. And the 535 00:27:42,160 --> 00:27:45,440 Speaker 1: President is not endorsed it, but said quote will look 536 00:27:45,520 --> 00:27:49,440 Speaker 1: at it. Can you speak to our global audience about 537 00:27:49,480 --> 00:27:53,639 Speaker 1: the pathology and the the almost the physiology of these 538 00:27:53,680 --> 00:27:58,240 Speaker 1: these easy solutions on a virus pathology? Isn't there are 539 00:27:58,280 --> 00:28:02,159 Speaker 1: no easy solution. There are plenty of fantastic sciences scientists 540 00:28:02,200 --> 00:28:06,680 Speaker 1: in many countries around the globe. There's a hundred potential vaccines, 541 00:28:06,760 --> 00:28:09,560 Speaker 1: several of which are probably gonna work. I think the most, 542 00:28:09,840 --> 00:28:13,640 Speaker 1: uh most further furthest along is astro Zeneca and Oxford 543 00:28:13,720 --> 00:28:18,600 Speaker 1: University in the UK. That appears to be far advancing 544 00:28:18,640 --> 00:28:21,440 Speaker 1: because the drug company is going to do an unusual 545 00:28:21,600 --> 00:28:24,080 Speaker 1: kind of test called the Challenge tests, which will even 546 00:28:24,160 --> 00:28:27,159 Speaker 1: move that and they're also already making doses on the 547 00:28:27,240 --> 00:28:30,119 Speaker 1: com That is uh to to take the risk of 548 00:28:30,520 --> 00:28:33,480 Speaker 1: making something that's not gonna work, I think it will work. Uh. 549 00:28:33,520 --> 00:28:35,560 Speaker 1: It certainly isn't going to be there by the election, 550 00:28:36,440 --> 00:28:39,800 Speaker 1: but you know it's possible it will be there by January, 551 00:28:39,880 --> 00:28:41,280 Speaker 1: and that will make a difference. It won't make a 552 00:28:41,280 --> 00:28:43,800 Speaker 1: difference right away because there's seven billion people in the 553 00:28:43,840 --> 00:28:46,640 Speaker 1: world and at least sixty or seventy of them have 554 00:28:46,680 --> 00:28:49,240 Speaker 1: to be vaccinated in order to get hurt immunity. But 555 00:28:49,320 --> 00:28:51,600 Speaker 1: these cracked by theories people should not. I mean, the 556 00:28:51,640 --> 00:28:53,600 Speaker 1: President the United States is just keep his mouth chef 557 00:28:53,680 --> 00:28:57,040 Speaker 1: that that's clinically impossible for US. Dr Dean, thank you 558 00:28:57,080 --> 00:29:00,840 Speaker 1: so much, of course, a former DNC chair. Thanks for 559 00:29:00,920 --> 00:29:05,360 Speaker 1: listening to the Bloomberg Surveillance podcast. Subscribe and listen to 560 00:29:05,480 --> 00:29:11,200 Speaker 1: interviews on Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. 561 00:29:11,760 --> 00:29:15,080 Speaker 1: I'm on Twitter at Tom Keene before the podcast. You 562 00:29:15,120 --> 00:29:18,520 Speaker 1: can always catch us worldwide. I'm Bloomberg Radio.