WEBVTT - BI Weekend: Pfizer, Micron Earnings 0:00:02.920 --> 0:00:08.280 Bloomberg Audio, Studios, Podcasts, radio news. 0:00:10.680 --> 0:00:14.520 This is Bloomberg Intelligence with Alex Steel and Paul'sweenye. 0:00:14.600 --> 0:00:17.799 The real app performance has been the US corporate high yield. 0:00:18.000 --> 0:00:20.360 Are the companies lean enough? Have they trimmed all the fats? 0:00:20.400 --> 0:00:24.200 The semiconductor business is a really cyclical business. 0:00:23.680 --> 0:00:27.240 Breaking market headlines and corporate news from across the globe. 0:00:27.320 --> 0:00:29.960 Do investors like the M and A that we've seen? 0:00:30.200 --> 0:00:33.239 These are two big time blue chip companies. 0:00:33.400 --> 0:00:37.000 The window between the peak and cut changing super fast. 0:00:37.159 --> 0:00:41.800 Bloomberg Intelligence with Alex Steel and Paul'sweeny on Bloomberg Radio. 0:00:43.640 --> 0:00:46.000 On Today's Bloomberg Intelligence Show, we dig inside the big 0:00:46.000 --> 0:00:48.360 business story is impacting Wall Street and the global markets. 0:00:48.479 --> 0:00:50.519 Each and every week we provide in depth research and 0:00:50.600 --> 0:00:52.400 data on some of the two thousand companies and one 0:00:52.479 --> 0:00:55.279 hundred and thirty industries our analysts cover worldwide. 0:00:55.480 --> 0:00:58.200 Today, we'll look at why US Vacation has planned to 0:00:58.240 --> 0:01:00.000 increase travel spending in twenty twenty five. 0:01:00.280 --> 0:01:03.360 Plus, we'll break down my Micron Technologies revenue forecast missed 0:01:03.360 --> 0:01:04.360 analyst projections. 0:01:04.640 --> 0:01:07.760 First, we begin with earnings from the biopharmaceutical company Pfiser. 0:01:08.040 --> 0:01:10.880 This week, viser forecasted twenty twenty five sales and earnings 0:01:10.920 --> 0:01:12.360 in line with analyst projections. 0:01:12.520 --> 0:01:15.480 It's a step towards offering relief to weary investors that 0:01:15.520 --> 0:01:17.520 feel the drugmaker is being mismanaged. 0:01:17.600 --> 0:01:20.080 For more, we are joined by Zam Fazelli, Bloomberg Intelligence, 0:01:20.120 --> 0:01:23.320 Director of Research for Global Industries and Senior Pharmaceuticals, and 0:01:23.360 --> 0:01:26.160 we first asked Sam about Pfizer's guidance for investors. 0:01:26.640 --> 0:01:30.360 Look, this is the story about a company that didn't disappoint. 0:01:30.920 --> 0:01:34.440 I think, having seen what happened during twenty twenty four, 0:01:35.000 --> 0:01:37.480 this is the company that people were a bit worried about. 0:01:37.560 --> 0:01:38.720 You know, is it going to come out and give 0:01:38.800 --> 0:01:43.160 us a whole bunch of guidance that is actually below consensus? 0:01:43.400 --> 0:01:46.000 And here we are with something that's in line with 0:01:46.080 --> 0:01:50.480 consensus pretty much mostly. There are some moving parts that's 0:01:51.320 --> 0:01:52.960 you know, to think about it if you want to 0:01:52.960 --> 0:01:54.760 get into the nitty gritty, but at the end of 0:01:54.800 --> 0:01:57.080 the day, it's pretty much in line with consensus. And 0:01:57.120 --> 0:01:59.440 that's a sigh of relief for a stock that's pretty 0:01:59.480 --> 0:02:02.120 much close to I don't know if it's an all 0:02:02.280 --> 0:02:04.520 time lobe, because this company has been around for a 0:02:04.560 --> 0:02:08.400 long long, long time. But it certainly is a very 0:02:08.400 --> 0:02:11.120 weak share price compared to where it's been before, especially 0:02:11.120 --> 0:02:13.600 in the heights of the pandemic with COVID sales and 0:02:13.639 --> 0:02:15.720 everybody think it's going to be one hundred billion dollar market 0:02:15.720 --> 0:02:18.160 a year. So U that's where we are. 0:02:18.160 --> 0:02:20.240 Speaking of vaccines for a second. We were watching the 0:02:20.240 --> 0:02:23.040 Patrick Stewart Scrooge movie. We like to do Christmas movies, 0:02:23.040 --> 0:02:25.320 and my daughter goes, when was this set like in 0:02:25.360 --> 0:02:29.960 the eighties? Right, so to the point we're like, no, honey, 0:02:30.000 --> 0:02:31.560 like it was, it was a long time ago, and 0:02:31.600 --> 0:02:33.600 we will I'll be dead at this point if we 0:02:33.720 --> 0:02:37.440 learnt that time. Okay, But I guess my question is, 0:02:37.480 --> 0:02:39.240 how do we have conviction on what these docks are 0:02:39.240 --> 0:02:41.480 going to do next year? We have no idea what 0:02:41.520 --> 0:02:44.079 the administration is going to be like or what their 0:02:44.120 --> 0:02:46.320 relationship with drug companies is going to be. 0:02:46.400 --> 0:02:51.000 Like, Yeah, but Alex, you know the government can't change 0:02:51.000 --> 0:02:54.119 things overnight, right, so by the time they take off 0:02:54.160 --> 0:02:59.119 is by the time they start putting new laws into play, which, 0:02:59.160 --> 0:03:00.959 of course one of them is possibly going to be 0:03:01.120 --> 0:03:03.640 some way of trying to rain in the PBMs. The 0:03:03.680 --> 0:03:06.799 pharmacy benefit managers, the middlemen who take the big fat 0:03:06.880 --> 0:03:10.960 chunk of a profit out of these high drug prices. 0:03:11.919 --> 0:03:13.680 By the time that happens, it will be twenty twenty 0:03:13.680 --> 0:03:16.280 six or something like that. The reality is that it's 0:03:16.320 --> 0:03:18.840 all going to be about rhetoric. Right, So are we 0:03:18.919 --> 0:03:23.720 going to have a health and human services run by 0:03:23.840 --> 0:03:27.160 RFK anti vaccine? Is you're going to tone down his 0:03:27.240 --> 0:03:29.639 anti vaccine? Is he going to get confirmed? So it's 0:03:29.680 --> 0:03:32.800 going to be all about the optic optics of it, 0:03:32.840 --> 0:03:36.440 and it's also all about the rhetoric no real impact. 0:03:37.120 --> 0:03:40.320 But investors don't look at what's happening next year. They 0:03:40.320 --> 0:03:41.960 always look at two or three years down the road. 0:03:42.320 --> 0:03:45.600 Now here we have a company and that's dealing with IRA. 0:03:45.760 --> 0:03:48.320 I think it's the first farmer company has put out 0:03:48.440 --> 0:03:51.760 their guidance and they're saying that the changes in the IRA, 0:03:51.800 --> 0:03:53.520 which are good for patients. By the way, I have 0:03:53.520 --> 0:03:55.920 to say that right up front, is going to hit 0:03:55.960 --> 0:03:58.400 them about one to one and a half billion dollars. 0:03:58.400 --> 0:04:00.640 I think the number or a billion dollars, so one 0:04:00.680 --> 0:04:04.000 and a half percent hit right. So that's because they're 0:04:04.040 --> 0:04:07.160 going to be having to cover the catastrophic. 0:04:08.760 --> 0:04:09.240 Pay that. 0:04:11.280 --> 0:04:14.080 In terms of the part the medicare coverage, and of 0:04:14.080 --> 0:04:16.440 course they've got drugs that are high priced, so that 0:04:16.560 --> 0:04:18.800 sort of thing I do expect. And of course, you know, 0:04:18.880 --> 0:04:21.680 sentiment is all in our world, so it just tells 0:04:21.720 --> 0:04:23.240 you where we are in some of these names. 0:04:23.520 --> 0:04:25.680 One of the great new functions on the Bloomberg terminals 0:04:25.880 --> 0:04:30.240 MODL for financial models, and this is where Bloomberg Intelligence 0:04:30.279 --> 0:04:34.040 and Bloomberg have compiled a lot of the earning estimate 0:04:34.080 --> 0:04:36.239 models from a lot of the leading Wall Street and analysts. 0:04:36.600 --> 0:04:38.960 And what you see there is for a company like Pfiser, 0:04:39.240 --> 0:04:41.920 they got a lot of drugs, and investors really focus 0:04:41.960 --> 0:04:45.039 on the various drugs and how they're growing. What do 0:04:45.120 --> 0:04:49.240 you focus on for Pfizer, Sam. 0:04:48.320 --> 0:04:52.440 Yeah, Sozer's twenty twenty five is about execution and getting 0:04:52.960 --> 0:04:55.880 this new company that they bought Sea Gun. It's now 0:04:55.880 --> 0:04:57.720 that new anymore. It's a while ago they bought it 0:04:58.000 --> 0:05:01.400 fully integrated, and managing those if you think about it, 0:05:01.480 --> 0:05:03.240 a lot of what they've said today with regards to 0:05:03.279 --> 0:05:07.240 the growth on the EPs line is due to managing costs. 0:05:07.440 --> 0:05:11.159 So they've come below some Wall Street expectations in terms 0:05:11.200 --> 0:05:16.240 of sales and marketing costs and you know with within 0:05:16.640 --> 0:05:19.720 even R and D costs. So but that's been the case. 0:05:19.760 --> 0:05:23.239 This is a company that's trying to find its new world, 0:05:23.400 --> 0:05:25.680 in the new world of COVID. How much vaccine am 0:05:25.680 --> 0:05:27.520 I going to sell? How much black Slovia that I'm 0:05:27.520 --> 0:05:30.559 going to say? I remember, that's a nine billion dollar 0:05:30.640 --> 0:05:32.919 line or so, right, that's not a you know for 0:05:32.960 --> 0:05:35.760 a company that's guiding into six sixty one to sixty 0:05:36.040 --> 0:05:38.040 whatever the number is here, sixty one sixty four billion 0:05:38.040 --> 0:05:41.160 dollars sales range. So that's where there is. There was 0:05:41.200 --> 0:05:42.920 a lot of sensitivity here and worry and of course 0:05:42.920 --> 0:05:45.520 they've said, I think we're on a straight line from 0:05:45.640 --> 0:05:47.760 last year to twenty twenty four to twenty twenty five, 0:05:47.800 --> 0:05:51.560 so that's where they worry was. And frankly, new drugs 0:05:51.600 --> 0:05:54.600 and stuff. It's always important, but we need City Day 0:05:54.680 --> 0:05:55.400 to come through. 0:05:55.520 --> 0:05:58.640 Our Thanks to Sam Fazzelli, Bloomberg Intelligence, Director of Research 0:05:58.640 --> 0:06:01.800 for Global Industries and senior pharmaceutical scentalists, we. 0:06:01.720 --> 0:06:04.240 Move next to commercial real estate. This week, we focus 0:06:04.279 --> 0:06:06.800 on a story titled office real Estate is facing a 0:06:06.880 --> 0:06:08.920 year of reckoning in twenty twenty five. 0:06:09.240 --> 0:06:11.240 You can find the story on Bloomberg dot Com and 0:06:11.520 --> 0:06:14.280 The Terminal. It discusses how commercial real estate is bracing 0:06:14.320 --> 0:06:17.000 for losses in twenty twenty five as lenders run out 0:06:17.040 --> 0:06:19.880 of patients and borrowers struggle to refinance loans for more. 0:06:19.960 --> 0:06:22.480 We were joining by Patrick Clark, Bloomberg real estate reporter. 0:06:22.800 --> 0:06:25.120 We first asked him why commercial real estate may suffer 0:06:25.160 --> 0:06:25.599 next year. 0:06:26.120 --> 0:06:28.760 These things take time. It's like a slow grind down, 0:06:28.920 --> 0:06:31.640 just in the way that post GFC. You know, the 0:06:31.880 --> 0:06:34.960 delinquencies in default really didn't spike until or didn't peak 0:06:35.520 --> 0:06:38.039 untill twenty twelve. It takes time for the stuff to 0:06:38.040 --> 0:06:41.159 work its way through the system. Everyone's running out of 0:06:41.200 --> 0:06:44.080 patients a bit like on the lender side, you know, 0:06:44.320 --> 0:06:48.240 the extensions no longer come free, and they might not 0:06:48.279 --> 0:06:51.120 come at all at this point. So part of it 0:06:51.160 --> 0:06:53.000 is that I think the one thing that's changed is 0:06:53.040 --> 0:06:55.240 a year ago people might have expected we were going 0:06:55.320 --> 0:06:58.040 to get six or seven rate cuts this year, and 0:06:58.360 --> 0:07:00.760 now that's you know those Not only the does not happen, 0:07:01.040 --> 0:07:03.159 but we don't expect them next year later. So you 0:07:03.160 --> 0:07:07.960 can no longer sit there hoping and expecting that interest 0:07:08.000 --> 0:07:10.040 rates are going to save you. So you kind of 0:07:10.080 --> 0:07:10.920 got to make a decision. 0:07:11.600 --> 0:07:15.000 So how does this come about? Is it in terms of, oh, 0:07:15.080 --> 0:07:16.880 my goodness, the equity folks have to write down the 0:07:16.960 --> 0:07:19.920 value of the building. That only or usually happens when 0:07:20.400 --> 0:07:23.080 I've got a loan coming due and I've got to 0:07:23.080 --> 0:07:26.080 renegotiate it, and then I've got to get a determination 0:07:26.120 --> 0:07:28.240 of the value the building or the lender will put 0:07:28.240 --> 0:07:31.040 evaluation of the building. Is that typically the precipitating factor. 0:07:31.400 --> 0:07:33.480 Yeah, I think it's you know, it's the maturity wall. 0:07:33.520 --> 0:07:35.960 As you're you know, it comes time you have to 0:07:35.960 --> 0:07:38.200 pay off that there's a big Almost all these loans 0:07:38.200 --> 0:07:39.840 have big balloon payments at the end of them, and 0:07:39.880 --> 0:07:41.840 you got to pay them off. That means you've got 0:07:41.840 --> 0:07:43.720 to get a new loan. And the new loans have 0:07:43.800 --> 0:07:46.560 not really been available, and we're certainly not available at 0:07:46.880 --> 0:07:51.320 pricing that would be tolerable. And so that's where that's 0:07:51.360 --> 0:07:54.840 where the negotiations come in. And I think the again, 0:07:55.120 --> 0:07:57.640 the way those negotiations have played out over the last 0:07:57.680 --> 0:08:02.040 eighteen months have been the can down the road, extend 0:08:02.040 --> 0:08:04.440 and pretend, or sometimes the cleaned up version of that 0:08:04.560 --> 0:08:06.880 is amend and pretend, which means you actually have to 0:08:06.880 --> 0:08:10.640 put something in to get the extension. But again, it's 0:08:10.680 --> 0:08:15.280 like the extensions are a little they become harder and 0:08:15.320 --> 0:08:18.040 harder to get over time, particularly as this hope that 0:08:18.080 --> 0:08:20.280 there's going to be an event which makes all the 0:08:20.320 --> 0:08:22.360 problems go away and dissipates. 0:08:22.840 --> 0:08:25.160 When is the maturity wall sort of coming up? And 0:08:25.160 --> 0:08:29.280 I appreciate it's probably property by property and who takes. 0:08:29.000 --> 0:08:31.920 The hit the maturity wall is you know, it's permeable, right, 0:08:31.960 --> 0:08:35.400 things pass through it. They in some ways, you know, 0:08:35.440 --> 0:08:39.319 there's there. The one thing that happens when you extend 0:08:39.320 --> 0:08:43.280 loans is that you add them to next year's maturity wall, 0:08:43.440 --> 0:08:46.439 and so the more the more loans don't pay off. 0:08:46.480 --> 0:08:48.040 And I saw stat I don't think we got into 0:08:48.040 --> 0:08:50.840 the story, but something like, you know, it's only like 0:08:50.880 --> 0:08:55.360 a quarter of Central Business District office buildings that are 0:08:55.360 --> 0:08:59.000 financed in the CNBS market have paid off at maturity 0:08:59.040 --> 0:09:01.800 over the last three or four So it's like a 0:09:01.840 --> 0:09:04.000 lot of them are pushing out. They're pushing out, and 0:09:04.040 --> 0:09:06.800 that just makes the maturity wall go higher. Now they 0:09:06.840 --> 0:09:09.480 can continue to be pushed out until they can't. And 0:09:09.520 --> 0:09:12.360 we don't know exactly when that moment will hit or 0:09:12.480 --> 0:09:14.679 with what force or with with what volume? 0:09:15.040 --> 0:09:18.679 Right, a sprinkle of companies are coming sing we're getting 0:09:18.679 --> 0:09:21.679 people back five days a week. And I wonder if 0:09:21.679 --> 0:09:24.319 that's being perceived by the commercial real estate market is 0:09:24.360 --> 0:09:26.560 all right, maybe the worst is behind us in terms 0:09:26.600 --> 0:09:29.880 of vacancies and that kind of thing. Is there any 0:09:30.600 --> 0:09:33.200 any discussion of real estate business that maybe just the 0:09:33.360 --> 0:09:35.080 business fundamentals have bottomed. 0:09:35.400 --> 0:09:38.160 I think yeah, sure, yes, and I but in some 0:09:38.200 --> 0:09:41.880 ways I think that is more of a catalyst for 0:09:42.600 --> 0:09:46.200 resolution of these situations. It's sort of like, we know 0:09:46.320 --> 0:09:49.680 what it is now. It's not great. It's it's great 0:09:49.720 --> 0:09:52.480 if you own one Vanderbilt or you know, a brand 0:09:52.520 --> 0:09:55.360 new high tech office building seven thirty one les. But 0:09:55.720 --> 0:09:58.640 you know if you own commodity office and in you know, 0:09:58.679 --> 0:10:02.240 in the garment district or something, and that's you know 0:10:02.280 --> 0:10:03.600 what it is now, and it's not great. 0:10:03.760 --> 0:10:03.920 Right. 0:10:04.440 --> 0:10:06.160 I'm just wondering, is it big banks that have a 0:10:06.160 --> 0:10:09.040 lot of these loans? Is it small guys, Like where 0:10:09.040 --> 0:10:10.160 do we see the ripples? 0:10:10.559 --> 0:10:10.839 Well? 0:10:10.920 --> 0:10:12.319 I think that one of the things that I think 0:10:12.320 --> 0:10:15.040 we've seen happen is that the bigger banks that are 0:10:15.080 --> 0:10:20.960 in you know, better situations across their business have been 0:10:21.040 --> 0:10:24.920 able to and have been reserving at a you know, 0:10:24.920 --> 0:10:27.920 at a faster at a higher rate. So they are 0:10:28.400 --> 0:10:30.840 you know, they've been quicker to acknowledge the issues and 0:10:30.880 --> 0:10:35.640 to prepare themselves to ultimately realize losses, whereas smaller banks 0:10:35.640 --> 0:10:38.680 we've seen much less of that. You know, we're starting 0:10:38.720 --> 0:10:43.040 to see smaller regional banks modify loans at a greater pace, 0:10:43.120 --> 0:10:46.760 which again I think we see as like they're pretending less. 0:10:46.960 --> 0:10:49.240 They're still they're extending and pretending less. 0:10:49.400 --> 0:10:55.040 No, no, well they're pretending less anyway, like they're acknowledging. Yes, okay, 0:10:55.120 --> 0:10:57.240 like more stuff is still yet to happen. We can't 0:10:57.280 --> 0:10:59.160 just push these things out. We have to get ourselves 0:10:59.200 --> 0:11:03.319 in position. But nobody wants this all to happen at once, right, 0:11:03.360 --> 0:11:05.960 I mean, it's in everyone's interests for these problems to 0:11:06.000 --> 0:11:10.880 be realized, you know, gradually and at a pace where 0:11:10.960 --> 0:11:13.720 they can kind of be controlled our Thanks to Patrick Clark, 0:11:13.720 --> 0:11:15.000 Bloomberg Real Estate. 0:11:14.800 --> 0:11:16.880 Reporter, coming up, we're going to dig deeper into a 0:11:16.920 --> 0:11:20.720 retirement crunch that's haunting Americans nearing sixty years old. 0:11:20.880 --> 0:11:23.800 You're listening to Bloomberg Intelligence on Bloomberg Radio, providing into 0:11:23.920 --> 0:11:26.120 research and data on two thousand companies in one hundred 0:11:26.120 --> 0:11:29.120 and thirty industries. You can access Bloomberg Intelligence via Bigo 0:11:29.200 --> 0:11:29.720 on the terminal. 0:11:29.800 --> 0:11:32.920 I'll Paul Sweeney and I'm Alex Steele, and this is Bloomberg. 0:11:37.360 --> 0:11:41.240 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:11:41.320 --> 0:11:44.439 weekdays at ten am Eastern on applecar Playing and broud 0:11:44.440 --> 0:11:47.560 Auto with the Bloomberg Business app. Listen on demand wherever 0:11:47.600 --> 0:11:51.439 you get your podcasts, or watch us live on YouTube. 0:11:52.280 --> 0:11:54.640 We move next to the travel and leisure sector. According 0:11:54.679 --> 0:11:57.760 to a Bloomberg Intelligence survey, US vacationers plan to increase 0:11:57.800 --> 0:11:59.960 travel spending in twenty twenty five from last year. 0:12:00.280 --> 0:12:02.440 And for more on this research, we were joined by 0:12:02.520 --> 0:12:04.760 Jody Lourie, Bloomberg Intelligence Credit Analysts. 0:12:04.760 --> 0:12:06.400 We first asked Jody to walk us through some of 0:12:06.400 --> 0:12:07.600 these findings from her survey. 0:12:08.120 --> 0:12:10.480 I have to say, as a credit analyst, and I've 0:12:10.520 --> 0:12:13.400 mentioned this a few times on your show, we get 0:12:13.920 --> 0:12:16.880 uncomfortable with the amount of optimism, and we got on. 0:12:17.360 --> 0:12:19.920 I was uncomfortable personally because we did our credit outlook 0:12:19.960 --> 0:12:22.800 and it was a bit too optimistic for my liking. 0:12:22.920 --> 0:12:27.360 That said the data doesn't lie. And when we surveyed vacationers, 0:12:27.679 --> 0:12:29.920 seventy two percent said that they're willing to spend more 0:12:29.960 --> 0:12:32.520 in twenty five versus twenty four. Now you compare that 0:12:32.559 --> 0:12:35.120 to last year, where it was only sixty seven percent 0:12:35.160 --> 0:12:37.439 said they were planning to spend more in twenty four 0:12:37.640 --> 0:12:40.280 over twenty three. So it's a pretty big bumb. 0:12:40.520 --> 0:12:43.240 Where are they spending? How are they spending? 0:12:44.679 --> 0:12:47.400 Sure, so, Paul, I mean, I think if you think 0:12:47.400 --> 0:12:51.000 of the average person, going on vacation is. 0:12:51.000 --> 0:12:51.800 A big thing. 0:12:52.320 --> 0:12:55.319 We zeroed in on people who are planning vacation as 0:12:55.320 --> 0:12:58.160 a priority for next year, and for those people, they 0:12:58.280 --> 0:13:00.800 are actually saying seventy nine per center saying that they're 0:13:00.800 --> 0:13:04.320 spending more on travel overclothing, and that was compared to 0:13:04.360 --> 0:13:07.600 seventy percent last year. Now, where they're going is also 0:13:07.679 --> 0:13:11.760 interesting because we saw a big spike in vacationers who 0:13:11.760 --> 0:13:14.200 are planning on going on cruises that's thirty seven percent, 0:13:14.640 --> 0:13:19.080 as well as on all inclusive vacations. And we did 0:13:19.120 --> 0:13:21.520 see a pullback in theme parks, We saw a pullback 0:13:21.520 --> 0:13:25.600 in casinos and race tracks, and so what we're seeing 0:13:25.800 --> 0:13:27.800 is a lot of I guess set in and forget 0:13:27.840 --> 0:13:31.240 it type vacations, vacations where people can do these big, 0:13:31.360 --> 0:13:35.000 luxurious things, and also in hot places like the Caribbean, 0:13:35.120 --> 0:13:36.200 Italy or Mexico. 0:13:36.640 --> 0:13:39.280 Oh, that's interesting. And also then in terms of budget, 0:13:39.360 --> 0:13:41.080 like you said, set it and forget it, like you 0:13:41.080 --> 0:13:43.120 get the budget, it's done, like you know exactly how 0:13:43.200 --> 0:13:44.880 much you're gonna pay, you don't have to think about it. 0:13:45.000 --> 0:13:48.680 That's quite interesting. Is there what's taken a hit like 0:13:48.720 --> 0:13:51.199 you mentioned, maybe where they're not spending money as much? 0:13:52.640 --> 0:13:56.520 Right so, I think what we're a little bit concerned about, 0:13:56.559 --> 0:13:59.800 Alex and we've been expressing this for quite a few 0:13:59.800 --> 0:14:02.079 months now, is in theme parks. You know, theme parks 0:14:02.080 --> 0:14:05.400 had a very good run in twenty twenty two, and 0:14:05.679 --> 0:14:08.360 the question is are they going to see that same 0:14:08.400 --> 0:14:10.040 run in twenty and twenty five, And so far the 0:14:10.080 --> 0:14:13.720 data is saying no. It's it's a little bit hard 0:14:13.720 --> 0:14:16.280 to say, but I would suspect that a lot of 0:14:16.320 --> 0:14:19.800 people are getting sticker shop for the destination theme parks 0:14:20.120 --> 0:14:21.880 and then the regional theme parks. Of course, you know 0:14:21.920 --> 0:14:24.520 we had the big merger between six Flags and Cedar Fair. 0:14:24.920 --> 0:14:28.920 We of course have United Parks formerly SeaWorld, and I 0:14:28.960 --> 0:14:32.160 don't know if people aren't necessarily either counting that as 0:14:32.200 --> 0:14:35.840 a vacation because their one day trip, or if they're 0:14:35.960 --> 0:14:38.760 choosing instead of doing these one day trips to do 0:14:38.800 --> 0:14:41.760 these big lavish vacations and that's where their budget is going. 0:14:42.480 --> 0:14:43.160 That's interesting. 0:14:43.280 --> 0:14:46.640 How about Europe because you know, you hear stories about 0:14:46.680 --> 0:14:50.200 how Europe was just overrun by American tourists over the 0:14:50.320 --> 0:14:54.320 last several years, and after September is my Europe. That's 0:14:54.320 --> 0:14:56.640 our new thing. So we do in Europe in September 0:14:56.760 --> 0:14:58.560 last year, we did Ireland. This year, I think we're 0:14:58.560 --> 0:15:01.400 going to do Italy. Confirming that to tomorrow with Kelly 0:15:01.440 --> 0:15:04.040 with Hawaii talk to us about Europe Americans still going 0:15:04.040 --> 0:15:06.120 to Europe because I mean, I get the euroed almost parody. 0:15:06.640 --> 0:15:09.440 Oh yeah, Paul, you are going to be one of 0:15:09.520 --> 0:15:12.160 many people going to Italy next year. It seems we 0:15:12.320 --> 0:15:15.440 had a big bump from last year, so people who 0:15:15.440 --> 0:15:17.680 are going to Italy. Last year was only about eighteen 0:15:17.720 --> 0:15:20.680 percent and now it's twenty five percent of our vacationers. 0:15:21.160 --> 0:15:24.520 So that's pretty big spike. Now putting it into context, 0:15:25.080 --> 0:15:27.960 Italy isn't quite back to where it was pre pandemic 0:15:28.400 --> 0:15:32.960 in terms of vacationers or travelers into Italy, but they 0:15:32.960 --> 0:15:36.320 are getting there. What we are seeing is, you know, Mexico, 0:15:36.400 --> 0:15:39.280 the Caribbean, it's it's very, very high, and it's going 0:15:39.320 --> 0:15:43.200 to get higher. Places like Italy, Portugal, Spain, those are 0:15:43.200 --> 0:15:46.160 going to do very well next year too. Whether or 0:15:46.200 --> 0:15:48.320 not we get back to pre pandemic levels for some 0:15:48.360 --> 0:15:50.760 of those countries remains to be seen. But you might 0:15:50.880 --> 0:15:53.520 see that you're a little bit crowded. Paul, and perhaps 0:15:53.640 --> 0:15:57.320 the government of those countries they've been talking about limiting 0:15:57.680 --> 0:16:01.520 cruise lines, for example, in terms of docking and so interesting. 0:16:01.760 --> 0:16:04.160 You know, it might be a little bit harder to 0:16:04.160 --> 0:16:05.400 get there. You might have to be a little bit 0:16:05.400 --> 0:16:05.880 more creative. 0:16:06.000 --> 0:16:08.120 Going to September. Yeah, he's going in September. He doesn't 0:16:08.160 --> 0:16:09.920 have kids like he's septembery. 0:16:09.920 --> 0:16:10.360 You'll be fine. 0:16:10.360 --> 0:16:12.920 I'm the one with the problem. I'm planning a Scotland 0:16:12.920 --> 0:16:16.360 trip in July. That's going to be something. So yeah, okay, yeah, 0:16:16.400 --> 0:16:19.560 So let's talk about individual companies. So your credit analyst, 0:16:19.880 --> 0:16:21.880 which kind of companies are going to win from this. 0:16:22.680 --> 0:16:25.760 We're suspecting that Royal Caribbean and Carnival in particular, are 0:16:25.840 --> 0:16:27.680 going to do quite well from this. You could also 0:16:27.720 --> 0:16:30.760 say a Viking would do well because the smaller vessel 0:16:30.840 --> 0:16:33.840 cruise ships are going to be able to access these 0:16:33.880 --> 0:16:38.480 small islands and you know in the Mediterranean. But companies 0:16:38.560 --> 0:16:41.560 that that also could potentially do well, we think is 0:16:41.800 --> 0:16:44.600 something like a Marriott or a Hyatt in terms of 0:16:44.680 --> 0:16:47.400 you know, publicly traded companies, I should say, and the 0:16:47.480 --> 0:16:49.840 reason being is, you know, Hyatt, for example, they bought 0:16:49.880 --> 0:16:52.640 Apple Leisure in twenty twenty one and that gave them 0:16:52.640 --> 0:16:57.080 a bigger footprint into Mexico, into the Caribbean. These companies 0:16:57.160 --> 0:17:00.040 folk have been focusing a lot of their dollars on 0:17:00.160 --> 0:17:03.560 the Caribbean. But also something interesting is Marriott announced an 0:17:03.600 --> 0:17:08.320 acquisition of a company that focuses on wilderness and sort 0:17:08.320 --> 0:17:12.240 of these natural cabin type places. So really really getting 0:17:12.240 --> 0:17:15.200 a big kind of mix of things competition with I 0:17:15.200 --> 0:17:18.439 guess you could say the Airbnb or the outpost airbnbs. 0:17:18.720 --> 0:17:22.160 And we are seeing that a lot of people are 0:17:22.160 --> 0:17:26.800 preferring domestic vacations next year, you know, it's spiking to 0:17:27.160 --> 0:17:29.679 ninety eight percent or planning or going on domestic vacation 0:17:29.840 --> 0:17:32.640 versus ninety six I believe it was last year, and 0:17:33.280 --> 0:17:36.439 international is staying flat at about seventy eight percent, so 0:17:37.160 --> 0:17:39.800 people are looking domestic. We might see more national park 0:17:40.080 --> 0:17:43.920 spending or national park visits than we saw, and Marriotte's 0:17:43.920 --> 0:17:44.800 taking advantage of that. 0:17:45.280 --> 0:17:48.240 Our thanks to Jody Lorie Bloomberg Intelligence Credit Analysts. 0:17:48.320 --> 0:17:50.240 We move next to a Bloomberg Big Take story we 0:17:50.320 --> 0:17:53.679 focused on this week, titled need to Grind Retirement crunch 0:17:53.720 --> 0:17:56.560 haunts Americans nearing sixty. You can find it on Bloomberg 0:17:56.560 --> 0:17:57.720 dot Com and The Terminal. 0:17:57.960 --> 0:18:01.240 The story looks at how Generation X face's significant financial 0:18:01.280 --> 0:18:04.159 stress as they approach retirement age, with many feeling they 0:18:04.200 --> 0:18:06.480 won't be able to afford to retire comfortably. 0:18:06.600 --> 0:18:08.760 For more, we are joined by one of the story's authors, 0:18:08.760 --> 0:18:12.560 Suzanne Woolley, Bloomberg Personal Finance reporter. We first asked Suzanne 0:18:12.560 --> 0:18:14.160 to break down what she found in her reporting. 0:18:14.800 --> 0:18:17.280 Yeah, there's a lot of stress about it because, you know, 0:18:17.400 --> 0:18:20.760 as the oldest exers become sixty, I mean they were 0:18:20.760 --> 0:18:23.280 sort of the guinea pigs for four one k's. The 0:18:23.320 --> 0:18:26.800 boomers had pensions, you know, and the four one k 0:18:26.920 --> 0:18:29.760 on top of that, and now the exers are sort 0:18:29.800 --> 0:18:35.400 of looking at their balances and looking at the news 0:18:35.400 --> 0:18:38.159 about maybe Social Security having to be reformed within the 0:18:38.200 --> 0:18:41.200 next decade, and looking at the money that they're spending 0:18:41.240 --> 0:18:45.400 supporting their adult children and possibly also their parents aging parents, 0:18:46.080 --> 0:18:50.240 and it's just leading to a lot of concern about 0:18:50.560 --> 0:18:53.159 how the heck are you going to be able to 0:18:53.240 --> 0:18:54.960 retire in comfort anytime soon? 0:18:55.280 --> 0:18:55.480 Right? 0:18:55.520 --> 0:18:57.160 So, I was struck by it, was it forty three 0:18:57.200 --> 0:18:59.960 percent say they can't afford to retire at sixty five. 0:19:00.400 --> 0:19:01.400 That is staggering. 0:19:01.840 --> 0:19:06.960 It is staggering, you know. It's it's just a combination 0:19:07.040 --> 0:19:09.840 of a lot of things. I mean, housing affordability has 0:19:09.880 --> 0:19:12.000 been an issue, you know, the high cost of living 0:19:12.119 --> 0:19:15.000 is an issue. These are sort of the peak earning 0:19:15.080 --> 0:19:17.639 years for a lot of exers, and they're hit with 0:19:17.680 --> 0:19:19.760 the pandemic, which a lot of them say was a 0:19:19.760 --> 0:19:23.679 big blow to their savings, you know, and then just 0:19:23.800 --> 0:19:27.359 the cost of groceries, the cost of housing. Everything has 0:19:27.400 --> 0:19:30.000 been going up and up and up, and it's harder 0:19:30.040 --> 0:19:33.360 to save and it's harder to see, you know, how 0:19:33.400 --> 0:19:36.359 you eke more out of an already stretched budget to 0:19:36.400 --> 0:19:37.919 put away more for retirement. 0:19:39.000 --> 0:19:43.200 So is the expectation that since we're living longer, we're 0:19:43.240 --> 0:19:44.680 just going to have to work longer. 0:19:45.000 --> 0:19:47.359