Speaker 1: This is Bloomberg Business Wait inside from the reporters and
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Speaker 1: Podcast with Carol Messer and Tim Stenebek from Bloomberg Radio.
Speaker 2: All Right, we keep saying it over and over again.
Speaker 2: Get a twenty four hour news cycle with a lot
Speaker 2: of news out of China. And I feel like I've
Speaker 2: been saying that for the last two or three weeks.
Speaker 2: And our Balance of Power newsletter coming out today noting
Speaker 2: all roads no longer lead to Rome, they lead to Beijing.
Speaker 2: And this as US Commerce Secretary Gina Romando was wrapping
Speaker 2: up her trip to China. Yeah, the UK Foreign Secretary
Speaker 2: also arriving. That's the most senior British diplomatic visitor in
Speaker 2: five years. Russian President Vlatimir Putin's likely to visit as
Speaker 2: well in October.
Speaker 3: That's a big one.
Speaker 2: Yeah, to meet up with President Ji and so there's
Speaker 2: a lot going on.
Speaker 3: Yeah, we're really glad to have back with us for
Speaker 3: some analysis, for insight on the situation, also for the
Speaker 3: market and business outlook of China. We've got Andy Brown
Speaker 3: with us He's the former editorial director at Bloomberg New Economy,
Speaker 3: and he spent three decades in Asia as both China
Speaker 3: editor and a columnist for The Wall Street Journal. Today,
Speaker 3: Carol Andy leads the China Hub as a partner at
Speaker 3: Brunswick Group. It's a critical issues advisory firm. He joins
Speaker 3: us on Zoom from New York City.
Speaker 2: Andy, So good to have you back with us. We've
Speaker 2: been dying to talk to you because you really always
Speaker 2: give us some clarity on everything that's going on. So
Speaker 2: as our Balance of Power newsletter said, all roads no
Speaker 2: longer lead to Rome, They lead to Beijing, are they right?
Speaker 4: Well, first of all, it's great to be back on
Speaker 4: the show, Carol, tim always to be with you.
Speaker 5: All roads lead to Beijing.
Speaker 4: Certainly, Gina Raymondo's road led to Beijing and by all
Speaker 4: accounts a very successful visit. The Chinese take Gina Ramondo
Speaker 4: very seriously. They trust her, They seem to have a
Speaker 4: good relationship with her. They find her pragmatic, relatively non ideological.
Speaker 4: And this is really quite remarkable given that Gina Raymondo
Speaker 4: is at the sharp end of US economic engagement with China.
Speaker 4: Right She's the one that presides over this proliferating regime
Speaker 4: of sanctions and export controls and tariffs, which, of course
Speaker 4: this administration inherited from the last one, and the Chinese
Speaker 4: finders deeply threatening. Nonetheless, she had a pretty good visit,
Speaker 4: and her main message was no, no, no, we're not
Speaker 4: here to kill you. We don't want to put you
Speaker 4: out of business. This is not decoupling. This is de risking,
Speaker 4: and that's a very different thing.
Speaker 3: Well, what did you make of her comment that she
Speaker 3: argued that China is driving away American companies by making
Speaker 3: investments in the world's second biggest economy increasingly hazardous. She
Speaker 3: said that, Okay, here's the quote, Andy, I know, you
Speaker 3: know it. We talked a little bit about it yesterday.
Speaker 3: Increasingly I hear from businesses China is uninvestable because it's
Speaker 3: become too risky. This is what Gina Ramando told reporters
Speaker 3: Tuesday when she was aboard a high speed train from
Speaker 3: Beijing to Shanghai.
Speaker 2: Investment flows have been flowing out from foreign investors.
Speaker 4: Well, she said the right thing, and that's what they
Speaker 4: need to hear because quite often in China, the CEOs
Speaker 4: of the companies that are investing there don't dare speak
Speaker 4: that kind of truth to power. And so you know,
Speaker 4: it takes a gene Raymondo to go over there and
Speaker 4: and say, look, we have a we have a problem,
Speaker 4: and businesses certainly do have a problem now in China.
Speaker 4: It's still I think it's significant though. The second part
Speaker 4: of your commentry, she went on a high speed train.
Speaker 4: You know, that's that's interesting, right, That's that's kind of
Speaker 4: a common touch.
Speaker 6: She hopped the train to go down to Shanghai.
Speaker 5: The Chinese would have liked that.
Speaker 4: They showcased, you know, really unbelievably efficient two hundred mile
Speaker 4: an hour of four and a half hours from from Beijing.
Speaker 6: That Songhai, which is like unbelievable.
Speaker 2: We don't have that here in What is it about
Speaker 2: her that resonates so well with Chinese officials, Well.
Speaker 4: I think they feel that they can talk to her
Speaker 4: and they're going to get a straight answer. And that
Speaker 4: really was you know, and she she also you know,
Speaker 4: she she's she's constructive, right, so I thought, actually, she
Speaker 4: she handled it in a really smart way. She said, look,
Speaker 4: let let's start by with confidence building matches. So one
Speaker 4: of the things that she's agreed on is that the
Speaker 4: United States and China are going to promote.
Speaker 5: Travel, right, tourism.
Speaker 4: So who can disagree that it would be a good
Speaker 4: thing if more Americans went to China and more Chinese
Speaker 4: people came to the United States. Right, It builds trust,
Speaker 4: builds understanding people to people relations. You know, these countries
Speaker 4: have been separated now for three years under under lockdown.
Speaker 5: Very few flights.
Speaker 4: Now, I was in Beijing a couple of months ago.
Speaker 4: I was actually staying in four seasons hotel. Only foreigner
Speaker 4: in the in the whole hotel, right, I mean, the
Speaker 4: airport is half empty.
Speaker 6: We need more interaction and it's.
Speaker 5: Just a great place, a smart place to stop.
Speaker 3: Well, Andy, talk more about that, and give us some
Speaker 3: anecdotes from your recent trip there, because you've spent so
Speaker 3: much time in the country. Uh, I know this is
Speaker 3: post pandemic. You went there kind of during the pandemic too,
Speaker 3: when you were helping with you know, with the Olympics
Speaker 3: for NBC. But but just give us the differences that
Speaker 3: you see now based on your recent trip.
Speaker 1: Yeah.
Speaker 5: Well, I mean you've got to go.
Speaker 4: I mean you have to go there to feel this,
Speaker 4: the sense you get by talking to people on the street,
Speaker 4: my friends, people in the business community, people are kind
Speaker 4: of in shock, you know.
Speaker 5: I mean I understand this.
Speaker 4: You know, the the the the you know, the consumer
Speaker 4: confidence has really been shattered. I mean, people, I think
Speaker 4: feel really kind of discombind this disoriented.
Speaker 5: I mean, what just happened.
Speaker 4: You know, we went through a three a three year lockdown,
Speaker 4: and it was quite painful. I mean, you talk to
Speaker 4: people in Shanghai. They're suffering from something like post traumatic
Speaker 4: stress disorder.
Speaker 5: Right.
Speaker 4: These are these are you know, middle class, upper middle
Speaker 4: class families that didn't know if they were going to
Speaker 4: spend that night in bed in their own homes or
Speaker 4: be carted away to some isolation center, or if their
Speaker 4: kids would be taken from them, or if guys in
Speaker 4: white hazmat suits were going to burst through the front door,
Speaker 4: you know, and drag them out or put a lock
Speaker 4: on the outside of the door. They didn't know sometimes
Speaker 4: if they could even feed their families, right, And they've
Speaker 4: been so used to a government that looks after all this,
Speaker 4: that you know, is focused.
Speaker 5: On growth, focused.
Speaker 6: On on you know, on.
Speaker 4: Development, and it just seems like, you know, they're lurching
Speaker 4: from one blunder to another. And you know, the business,
Speaker 4: business confidence obviously is has has yet to recover, and
Speaker 4: the and the confidence of foreign investors. And that's what
Speaker 4: Gina Raimondo was was speaking to. You know, people got
Speaker 4: so used to the idea that Chinese supply chains were secure, right,
Speaker 4: and you could put them all in China. That's what
Speaker 4: Apple did the whole lot. And look what Apple's doing now.
Speaker 4: You know, it's starting at the margins, pulling it out,
Speaker 4: you know, putting it in places like Vietnam, India. It's
Speaker 4: all about now de risking.
Speaker 2: Back to Andy Brown, we go as you as we
Speaker 2: said earlier, he leads the China Hub. He's a partner
Speaker 2: over at Brunswick Group. Hosta with us on Zoom in
Speaker 2: New York City and you had the break.
Speaker 7: Yeah.
Speaker 3: My question, my question, Andy, is if China is doing
Speaker 3: so poorly in its attempted recovery from three years of lockdowns,
Speaker 3: if the consumer is so weak, if the concerns about
Speaker 3: shadow banks crumbling and not paying people back, do American
Speaker 3: companies really want to invest in China?
Speaker 4: You know, Tim, I think it's so important to put
Speaker 4: this into perspective. China is not collapsing, okay, China is
Speaker 4: suffering from what some people.
Speaker 5: Call the four d's.
Speaker 4: You've got a demographic crisis, you have a debt crisis,
Speaker 4: you have a decoupling problem, you have a deflation problem.
Speaker 4: The headlines look terrible, and it is extraordinary.
Speaker 5: China.
Speaker 4: The Chinese economy is barely growing right now, and the
Speaker 4: US economy is steaming ahead.
Speaker 5: I think it's growing what six percent?
Speaker 6: A complete role reversal.
Speaker 5: Right, but.
Speaker 4: China is the world's second largest economy, and it's going
Speaker 4: to be the second or third largest economy for decades
Speaker 4: to come.
Speaker 5: Right, it's not going away. I think what we can expect.
Speaker 4: Big, big, big picture, a starting now a period of
Speaker 4: slow relative decline. Businesses still must be in China, right,
Speaker 4: they can't ignore China, and particularly the businesses that are
Speaker 4: relying on China for future growth luxury, chemicals, auto and
Speaker 4: so on. In those industries they're pouring investment in.
Speaker 5: They have to.
Speaker 4: I mean, you can't be half hearted in China. You've
Speaker 4: got to be all in because the competition there is
Speaker 4: really good. So if you're there and you're dependent on growth,
Speaker 4: you have to invest to keep up with the market.
Speaker 4: You have to invest in technology so that you're able
Speaker 4: to compete. And in fact, some of these companies have
Speaker 4: an aggressive strategy of investment. It's called in China for
Speaker 4: China right So they're buying local companies, they're investing in technology.
Speaker 4: If you don't have to be in China right now,
Speaker 4: you don't want to be in China. If you've never
Speaker 4: been in China, you're certainly not going to go there
Speaker 4: for the first time now. And if you are in China,
Speaker 4: money investment that you might have put into China over
Speaker 4: and above the need to fuel and fund your footprint there,
Speaker 4: you're now looking at that money and say where else
Speaker 4: could I put it?
Speaker 5: Should I put it.
Speaker 4: In Vietnam, or in India, or in Mexico, or I
Speaker 4: might say here in the United States, which is one
Speaker 4: of the hardest investment destinations in the world right now?
Speaker 2: So do you believe and in your consulting that you
Speaker 2: do with clients, Andy, I mean, is it right though?
Speaker 2: For the US and nations throughout Europe that have slapped
Speaker 2: trade and regulatory penalties on China. You know their claims
Speaker 2: that it's coercive economic market behavior, if you will, are
Speaker 2: they right to do so? Especially when you've got the
Speaker 2: world's second largest economy kind of going through tough times,
Speaker 2: like what's the balance between that.
Speaker 4: Yeah, you know, look, Carol, I mean it is in
Speaker 4: nobody's interest to drive China further in where the country
Speaker 4: is looking in with now right and they feel threatened,
Speaker 4: they feel under sieged.
Speaker 5: This is in nobody's interest.
Speaker 6: It's in nobody's.
Speaker 4: Interest now to exacerbate its economic downturn. It's in nobody's
Speaker 4: that China should want to build its own institutions and
Speaker 4: undermine the global US led system, so, you know, and
Speaker 4: they do feel that they are under siege.
Speaker 5: And look, I get it that there.
Speaker 4: Are internal trends in China that you know, are encouraging
Speaker 4: this move towards in you know, this this focus, a
Speaker 4: relentless focus on national security, but can one also has
Speaker 4: to understand that China is responding also to actions that
Speaker 4: the United States is taking that make it feel that
Speaker 4: the world of the United States is out to get them.
Speaker 4: So you know, they look at this meeting that the
Speaker 4: curtain Camp David with Japan and South Korea and the
Speaker 4: United States, and this just adds to the sense of containment.
Speaker 5: So that's not in anybody.
Speaker 4: And there are a lot of people that are saying, look,
Speaker 4: you know, maybe it's time for a time out on
Speaker 4: some of this. You know, would it be such a
Speaker 4: bad idea to lift the tariffs on China, which, after all,
Speaker 4: I'm achieving any of their objectives of narrowing the trades
Speaker 4: up plus and in fact of being paid for in
Speaker 4: the end by the US consumer. And frankly, I think
Speaker 4: that this was this was something you know, some of
Speaker 4: that sentiment is is exactly what Gina Raymondo was expressing
Speaker 4: in her visit to China.
Speaker 5: We do the United States and China does two billion.
Speaker 4: Dollars a day of trade, you know, and she said, look,
Speaker 4: this trade is good for China, good for the United States,
Speaker 4: and good for the and good for the world. So
Speaker 4: you know, let's let's put some of this in proportion.
Speaker 2: And because can I just wait, follow if the world's
Speaker 2: second largest economy creator, we're going to feel it right
Speaker 2: here in the United States.
Speaker 4: You are, but it's not going to create it, Okay.
Speaker 4: I think the way to think about it is that,
Speaker 4: you know, China is a giant, right, it is an
Speaker 4: economic giant. It's it's manufacturing sector is bigger than the
Speaker 4: United States and Europe combined. Okay, and this year it's
Speaker 4: going to It's going to leap ahead of Japan to
Speaker 4: become the world's largest auto export. It's gobbling up the
Speaker 4: world's evy markets. It's a giant, but it's a giant
Speaker 4: with a weak heart, Okay, And that's going to make
Speaker 4: it less mobile, it's going to make it more prone
Speaker 4: to crisis.
Speaker 5: But it's still a giant.
Speaker 3: Andy this This is Secretary Romando's trip is coming at
Speaker 3: a time when we learned also that Vladimir Putin has
Speaker 3: agreed to visit China in his first trip since the
Speaker 3: ICC War crimes warrant was issued back in March. How
Speaker 3: should we look at China's embrace of Vladimir Putin and
Speaker 3: how that affects relations between the US and China.
Speaker 4: Yeah, this is this is an interesting visit. This This
Speaker 4: will be his first truly internet. He's been to a
Speaker 4: couple of neighboring countries in Central Asia, he went to Iran,
Speaker 4: but this is the first major international trip that he's
Speaker 4: taken since the International Criminal Court and A indicted him
Speaker 4: on on on war crime charges earlier this year. And
Speaker 4: what this is telling us is the Chinese are not
Speaker 4: giving up on Vladimir Putin. He was and remains what
Speaker 4: chi Jin being calls my best friend, regardless of you
Speaker 4: know what's happening in Ukraine. And look, I was in Beijing.
Speaker 4: You mentioned the Winter Olympics at the beginning of the
Speaker 4: beginning of last year, and this was where they hatched
Speaker 4: their no Limits partnership. Right on the opening day of
Speaker 4: Beijing Winter Olympics on February fourth, you know, games finished
Speaker 4: on February twentieth. Four days later, February twenty fourth, the
Speaker 4: tanks and armor and troops roll across the border into Ukraine,
Speaker 4: and ever since then China has been giving Russia diplomatic
Speaker 4: cover in the Ukraine. The bottom line is that they
Speaker 4: can't have Putin failing in China. It would be a
Speaker 4: severe blow personally Tsijim, but also the way they look
Speaker 4: at it in China is, look, you know, if US
Speaker 4: led NATO win here, win next, all right, and and
Speaker 4: so you know, bottom light, they cannot allow him to fail.
Speaker 2: It's complicated, right Andy though.
Speaker 4: It's super complicated because they're paying a pretty heavy price
Speaker 4: for this. And we talk about business investment. European business
Speaker 4: is looking at looking at China. Now they're reading right
Speaker 4: over from Ukraine to Taiwan. And saying, you know, we
Speaker 4: made this big bet on Russia and look where it
Speaker 4: got us.
Speaker 6: And you know we make making an even bigger bet
Speaker 6: on China.
Speaker 5: Governments are looking at European governments are.
Speaker 6: Looking at China in a very different way, you know.
Speaker 4: I mean, this is Putin is Europe's public enemy number one,
Speaker 4: and this is you know, Chi Jinping's best friend. Having
Speaker 4: said that, I mean, there's there's quite a bit that
Speaker 4: they can salvage out of this number one.
Speaker 5: You know, they're going to have a role.
Speaker 4: They they will have a role in any peace agreement,
Speaker 4: and they'll certainly have a big role, one would think,
Speaker 4: in the reconstruction of Ukraine if and when we finally
Speaker 4: get a peace in that country.
Speaker 2: Yeah, all right, listen, thank you so much. So appreciate it.
Speaker 2: We know it's all been busy for everybody, but so
Speaker 2: do appreciate whenever we get time with you. Andy bwall
Speaker 2: Andy Brown, as we said before, leads the China Hub
Speaker 2: as a partner at Brunswick Group and former Bloomberg colleague,
Speaker 2: former editorial director at Bloomberg New Economy. But as we said,
Speaker 2: three decades in Asia, China editor our communist for The
Speaker 2: Wall Street journal, So his experience is on the ground
Speaker 2: experience and really understanding it all.
Speaker 3: We have the data. We like to get the anecdotes
Speaker 3: from Andy two from his trips there totally.
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Speaker 2: So would you want to talk about the Hurricane Adela?
Speaker 3: Is it right to daily Hidelia?
Speaker 8: Delia too?
Speaker 2: Sounded great in my ear anyway. More importantly, knocking out
Speaker 2: power to one hundreds of thousands of customers, grounding more
Speaker 2: than eight hundred flights, unleashing floods along Florida's coast far
Speaker 2: from where it came ashore as a category Threames three
Speaker 2: storm earlier Wednesday. So we've been all tracking it. I'm
Speaker 2: sure you all have seen it on news, no doubt
Speaker 2: about it.
Speaker 3: Yeah, and Carol, you know, we track how much this
Speaker 3: stuff costs very closely because they're serious economic implications for
Speaker 3: disruptions and for repairs caused by storms. We talked about
Speaker 3: it with Hawaii. Estimates two are starting to come out
Speaker 3: about the cost of this storm, and key research says
Speaker 3: that IMMED lead to ten billion dollars in losses. And
Speaker 3: we know our team has already warned about FEMA running
Speaker 3: out of money following the fire in Hawaii.
Speaker 2: All right, so let's get to it. Lee Mayfield is
Speaker 2: with us. He's director of Response at the Emergency Management
Speaker 2: Consulting from hagrid Y Consulting. Also the former director of
Speaker 2: Public Safety and Emergency Management for Lee County, Florida, which
Speaker 2: includes Cape Coral and Fort Myers. He joins us on
Speaker 2: the phone from Tampa. Also with us as Rob Caroline.
Speaker 2: He's a Bloomberg News meteorologist. He joins us on the
Speaker 2: phone in New York. Rob, I do want to start
Speaker 2: with you. What's the latest on the storm and what
Speaker 2: you are seeing.
Speaker 9: We're seeing in the process of working its way towards
Speaker 9: the Brunswick, Georgia area. Carrol, It's now causing wing dust
Speaker 9: in the vicinity of Brunswick. It's sixty miles an hour
Speaker 9: at Douglas, Georgia also reporting sixty mile hour dust moving
Speaker 9: off to the northeast at twenty miles an hour. There's
Speaker 9: a tornado watch that's an effect from the coastal areas
Speaker 9: of northeastern Georgia, along the South Carolina coast and into
Speaker 9: southeastern North Carolina. That's up through nine o'clock this seasoning.
Speaker 9: The worst of the weather in regards to rain is
Speaker 9: north and northeast of that center of circulation that's west
Speaker 9: of Brunswick, Georgia. We're going to see four to eight
Speaker 9: inches of rain across that area over the next twenty
Speaker 9: four hours, which is going to lead to flash flooding
Speaker 9: near the core of what was the eye of the storm.
Speaker 9: That's where the highest winds are. You just mentioned the
Speaker 9: power outages. You look at the track map, you look
Speaker 9: at the power outages. They match right up from where
Speaker 9: it when inland at each Florida this morning and where
Speaker 9: it is now. Over the next six to twelve hours,
Speaker 9: the track will change from northeast to east northeast, so
Speaker 9: it's going to allow the storm to move across northeastern
Speaker 9: Georgia then up through eastern South Carolina tonight. Computer models
Speaker 9: the latest ones coming in have the storm then exiting
Speaker 9: the US coast just east of Wilmington, North Carolina, around
Speaker 9: seven o'clock tomorrow morning.
Speaker 3: So after seven o'clock tomorrow morning, rob Is. I mean,
Speaker 3: the worst of it is behind us.
Speaker 9: The worst of it will behind us. We'll notice that
Speaker 9: it's probably going to become a strong tropical storm overnight
Speaker 9: because the core is still inland. So what's happening is
Speaker 9: those wings of one hundred and twenty five miles now
Speaker 9: made landfall this morning are slowly winding down. We'll probably
Speaker 9: still see some dust up over hurricane fourth strength leader
Speaker 9: tonight into tomorrow morning, especially along the South and North
Speaker 9: Carolina coast. The outer banks will probably see those type
Speaker 9: of wings. But once it gets out into the Atlantic,
Speaker 9: all the really heavy rain that we're seeing north and
Speaker 9: northeast of the center will push out into the Atlantic
Speaker 9: and the flesh issues will go away. The only remaining
Speaker 9: issues will be some winds through midday tomorrow along the
Speaker 9: coast of North Carolina, and it's not as far south
Speaker 9: as Myrtle Beach, South Carolina.
Speaker 2: Hey, one thing I want to get into Listen, we
Speaker 2: have storms, and we've had, you know, my whole lifetime hurricanes.
Speaker 2: We have hurricane season and I'm not playing light to it.
Speaker 2: And I you know, there's lives at risk, and hope
Speaker 2: everyone that is in the path of this storm does okay.
Speaker 2: But what I want to get to with you, Lee,
Speaker 2: and then Rob way in on this as well, is
Speaker 2: in terms of what we increasingly are seeing in terms
Speaker 2: of the frequency, strength, force, and the impact and the
Speaker 2: amount of damage done by storms, and how climate change
Speaker 2: plays into it. Lee, how are you thinking about it
Speaker 2: bigger broadly and what worries you?
Speaker 8: Sure?
Speaker 7: Great question, you know, I think it's it's been almost
Speaker 7: a year since Hurricane Ian last year in the southwest
Speaker 7: Florida area, and here we are again. So I think
Speaker 7: this is part of our new reality. We've seen to
Speaker 7: have had a very busy five year period, especially when
Speaker 7: it comes to these devastatingcanes, and this one is no different.
Speaker 7: Idalia is an incredibly catastrophic storm. So I think really
Speaker 7: brings front and center this idea of resiliency and recovery
Speaker 7: and what does that look like moving forward as we
Speaker 7: see more of these storms?
Speaker 3: Well, what does resiliency look like?
Speaker 9: Does it?
Speaker 3: Does it look like actually people not living in places
Speaker 3: there they've traditionally livedly.
Speaker 7: You know, it's a team effort. You know, this business
Speaker 7: and emergency management and resiliency takes a lot of different players.
Speaker 7: You know, local jurisdiction, state, federal government. NGO's private sector
Speaker 7: funding is a big component of this. So I think
Speaker 7: that's something we have to seriously look at how we
Speaker 7: fund these larger projects as we look towards resiliency and
Speaker 7: mitigation moving forward.
Speaker 2: Well, and Rob come on in come back into the
Speaker 2: conversation in terms of the frequency and the volatility and
Speaker 2: the damage and the strength that we are seeing increasingly
Speaker 2: with the storms that impact the United States and really
Speaker 2: the world at large, but the US that we've seen,
Speaker 2: I mean, look at what happened on the West Coast.
Speaker 2: A storm just doesn't happen and there it happened. Just
Speaker 2: was it a week ago or so? Should we be
Speaker 2: thinking as a nation about not building on certain areas
Speaker 2: because it's just getting tougher and tougher for people to
Speaker 2: exist there.
Speaker 9: Well, that makes sense just from the fact that you know,
Speaker 9: barrier islands of the coast are temporary landforms. You know,
Speaker 9: they're not really meant to be built on. The last
Speaker 9: time we saw a hurricane or tropical storms at the
Speaker 9: West Coast was September of nineteen thirty nine. One of
Speaker 9: the things we meteorologists are aware of, and the hurricane
Speaker 9: cycle is there's a thirty year cycle with hurricanes, so
Speaker 9: the last peak rands through the nineteen fifties into the
Speaker 9: nineteen seventies. We had a tremendous amount of storms go
Speaker 9: up the East coast. In the nineteen fifties we had Hazel, Carrol, Donna.
Speaker 9: They all occurred in less than ten years. We're now
Speaker 9: in the midst of another very active cycle that should
Speaker 9: start to end in the mid twenty twenties. It's been
Speaker 9: running since the mid nineteen nineties and starts to decrease
Speaker 9: around twenty five or twenty six, so we've got a
Speaker 9: couple more years with that. The other thing that we
Speaker 9: really have to take a look at is the oceans
Speaker 9: on this planet are getting warmer. We're in a very
Speaker 9: warm cycle. The exist to do one thing, move heat
Speaker 9: from the tropical regions of the world to the polar regions.
Speaker 9: That's why they move around the Bermuda high They take
Speaker 9: that excess warmth that develops over the oceans during the
Speaker 9: summer and pushes it to the poles their heat engines,
Speaker 9: so they're trying to redistribute heat. The warmer the oceans are,
Speaker 9: the stronger, these systems are going to be and the
Speaker 9: other thing I've noticed I've been doing this for a
Speaker 9: little over thirty years in my career, the fact they
Speaker 9: are intensifying much more rapidly. From Katrina in two thousand
Speaker 9: and five becoming a storm of you know, incredible magnitude
Speaker 9: thirty six hours, it went from a Cat one to
Speaker 9: a Cat five. We had the same problem several years
Speaker 9: ago with Irma and Maria. They became Category five hurricanes
Speaker 9: in just.
Speaker 8: A few days.
Speaker 9: This storm went over waters that were ninety degrees or
Speaker 9: warmer over its seventy two hours in existence. And that's
Speaker 9: how you get a storm to go from a Cat
Speaker 9: one to a Cat or overnight. It's lee ocean driving
Speaker 9: this problem.
Speaker 3: Lead weigh in on that. Do you agree with with
Speaker 3: Rob that this is this is the warmer oceans are
Speaker 3: doing this and it's intensified throughout your career as well.
Speaker 7: Yeah, we've certainly seen this idea of rapid intensification. It's
Speaker 7: just really a big fear even of emergency managers. You know,
Speaker 7: Hurricane Michael comes to mind, and this one here is
Speaker 7: no different this week. You know, you're having to make
Speaker 7: decisions very quickly when these storms rapidly intensify and that's
Speaker 7: something that is difficult to do from a timing perspective
Speaker 7: and definitely a concern that we're having to deal with
Speaker 7: more in our profession.
Speaker 2: All Right, we're going to leave it on that note. Listen, guys,
Speaker 2: thank you so much for weighing in on all of
Speaker 2: this and giving us some perspective. So appreciate it. Lee Mayfield,
Speaker 2: director of Response at the emergency management consulting firm Hagridy Consulting.
Speaker 2: As we said, also former director of Public Safety and
Speaker 2: Emergency Management for Lee Keunny, Florida, and our thanks to
Speaker 2: Rob Carolyn. He's a well known voice when it comes
Speaker 2: to covering what's going on in the weather. A Bloomberg
Speaker 2: News meteorologist joining us, both of them on the phone.
Speaker 2: One in New York, Rob there, and of course Lee
Speaker 2: in Tampa.
Speaker 1: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 1: live weekday afternoons from three to sixty on Bloomberg Radio,
Speaker 1: the Bloomberg Business App and YouTube. You can also listen
Speaker 1: live on Amazon Alexa from our flagship New York station,
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Speaker 2: Got a head bang going on in our studio, Hey,
Speaker 2: We're talking cities stores already beginning to trickle out from
Speaker 2: the upcoming new double Cities issue of Bloomberg Business Week,
Speaker 2: out in its entirety on newsstands tomorrow, online at Bloomberg
Speaker 2: dot com slash Business Weekend on the Bloomberg and Tim
Speaker 2: we heard one of the stories from the issue yesterday.
Speaker 2: It was incredible.
Speaker 3: Yeah, it was about the seven hundred and fifty acre
Speaker 3: Jericho Gate development. It's part of the fragile real estate
Speaker 3: boom emerging in Palestinian territories. We talked all about it
Speaker 3: with the Bloomberg News Israel Bureau chief Ethan Browner, also
Speaker 3: Bloomberg BusinessWeek editor Joel Weber, who is also back with
Speaker 3: us today.
Speaker 2: He is, indeed, along with the BusinessWeek Technology editor Joshua
Speaker 2: Brustin and Bloomberg City Lab editor David Dudley. So let's
Speaker 2: get into the city's issue. Joe jointing us from Massachusetts,
Speaker 2: Joshua us here in our Bloomberg Interactive Broker studio, and
Speaker 2: David on zoom from our Washington DC bureau and Joel
Speaker 2: we were, you know, kidding Tim and I earlier that
Speaker 2: we kind of know certain times of the year we
Speaker 2: look forward to the city's Issue because you just take
Speaker 2: us I said it yesterday, You take us to parts
Speaker 2: of the world that maybe we don't talk about but
Speaker 2: we really should be.
Speaker 10: Yeah, and this has like just been a little source
Speaker 10: of pride for us because we've long done a city's issue,
Speaker 10: and then Bloomberg acquired City Lab and we were like, wow,
Speaker 10: now we can really make cities issues even that much better.
Speaker 10: And obviously Josh led the effort at the magazine. And
Speaker 10: when we started talking about this, I was like, you know,
Speaker 10: we don't have to kill ourselves. We don't need to
Speaker 10: go big. And Josh was like, actually, I was planning
Speaker 10: going to do like a full issue takeover, and I
Speaker 10: have like all these amazing stories, and I was like,
Speaker 10: oh my god, this is going to be amazing. So
Speaker 10: he tested it, and I think, you know, part of
Speaker 10: the framing we wanted to look at here is look here,
Speaker 10: we are a couple of years after COVID, although hey,
Speaker 10: cases still ticking back up and and cities are still
Speaker 10: in that aftermath, and and we wanted to kind of
Speaker 10: like look at a few of the ways that that's
Speaker 10: continued to play out and then find some of those
Speaker 10: really startling amazing stories that I'm sure we'll spend a
Speaker 10: little bit more time talking about, including yesterday. But Josh,
Speaker 10: where were the places that when you sort of architected
Speaker 10: and you started from blank white pages and these exercises
Speaker 10: like where did you want to make sure that we
Speaker 10: got to visit?
Speaker 8: Yeah?
Speaker 11: I think there were a couple of things for the
Speaker 11: last Today's issue. Actually, I had written about the idea
Speaker 11: of trying to build a new city from scratch, and
Speaker 11: so I know there's been a lot of effort around
Speaker 11: the world to do this. And on my list of
Speaker 11: places to look at was a place called Forest City
Speaker 11: in Malaysia, which is a city that is being constructed
Speaker 11: on what will eventually be if all goes according to
Speaker 11: plan for artificial islands, have about seven hundred thousand people
Speaker 11: on it. And the interesting thing about this city is
Speaker 11: that it was all based on the idea that the
Speaker 11: Chinese real estate market is just booming. It was being
Speaker 11: built by Country Garden, which whose name you might recognize
Speaker 11: if you've been paying attention.
Speaker 2: To the No, we never talk about it.
Speaker 3: China real estate market booming and Country Garden are two
Speaker 3: things we talk about quite a bit.
Speaker 11: Yes, we do go ahead so one of the islands
Speaker 11: has been constructed. There is uh, there's room for not
Speaker 11: seven hundred thousand residents, but certainly I think in the
Speaker 11: tens of thousands. And things have kind of ground to
Speaker 11: a halt. They've ran into trouble with COVID there. Now
Speaker 11: there's serious questions about demand, and so we sent a
Speaker 11: really talented reporter there to look around, to talk to people,
Speaker 11: and just to kind of see what is happening with
Speaker 11: one of these big audacious projects.
Speaker 10: Yeah, that real estate element attached to China, and it
Speaker 10: just really was a timely look at a place that
Speaker 10: you know, I think we're all very very curious and
Speaker 10: concerned about. So David that I want to bring you
Speaker 10: in because the City Lub was obviously totally instrumental in this.
Speaker 10: There was there was an idea that josh and I
Speaker 10: were noodling, and then josh was like, actually I talked
Speaker 10: to David and we should do what they're doing. I
Speaker 10: was obsessed with concrete. I was like, we got to
Speaker 10: do a story about concrete, like so much of the
Speaker 10: world uses that as a building.
Speaker 2: Do you hear what Joshua just you just said? That's true.
Speaker 10: I was like, let me tell you about concrete, Josh,
Speaker 10: But but David, tell us about where where we went
Speaker 10: with that initial Colonel.
Speaker 12: Yeah, sure, and thanks for playing playing the fog at
Speaker 12: to get us in here. We are we are fools
Speaker 12: for the city here at City Labs. So so yeah,
Speaker 12: So we had this project going where we were similarly
Speaker 12: kind of intrigued by and sort of astonished by the
Speaker 12: amazing kind of energy intensity of concrete production, which is,
Speaker 12: you know, something like eight nine percent of all carbon
Speaker 12: released in the atmosphere every year, and it's rivaled by
Speaker 12: steel production, and in many countries brick production, which is
Speaker 12: an even older material, is also intensely polluting. And so
Speaker 12: we had been dueling around with this idea of having
Speaker 12: a whole series about what we call the Stuff of Cities,
Speaker 12: which is just sort of a dive into the history
Speaker 12: and the past and the present in the future of
Speaker 12: the most essential building blocks of urban life.
Speaker 8: And we were able to.
Speaker 12: Sort of convert that idea into this really lovely looking
Speaker 12: kind of print and online package that looks at not
Speaker 12: only concrete and steel and brick, but also glass and
Speaker 12: asphalt and wood sort of the oldest material of the
Speaker 12: six that is kind of coming back into vogue as
Speaker 12: a kind of economically and environmentally useful building material for
Speaker 12: all kinds of skyscapers.
Speaker 2: Well, David, I don't want to get jo upset since
Speaker 2: he's really into concrete, But what is replacing concrete?
Speaker 8: Well, that's the thing.
Speaker 12: Nothing can replace concrete.
Speaker 2: It is.
Speaker 12: It is this miraculous artificial stone that has been a
Speaker 12: absolute kind of foundational material since Roman times. What we
Speaker 12: can do is we can we can devise ways of
Speaker 12: making it a little less polluting and hopefully a lot
Speaker 12: less polluting eventually. Uh So, there are there are techniques
Speaker 12: to fire it at lower temperatures. You know that the
Speaker 12: firing process of making cement is intensely kind of energy absorptive.
Speaker 8: Uh.
Speaker 12: There's chemical processes that can involve. There's uh adding more
Speaker 12: recycled elements. Uh, and there's also sort of being a
Speaker 12: little more flexible about how you use it and using
Speaker 12: different kinds of concrete for different applications. The concrete that
Speaker 12: that the Romans used, uh uh to millennia ago was
Speaker 12: actually sort of kind of environmentally and much less destructive.
Speaker 12: So this kind of kind of kind of nerding out
Speaker 12: to the to the greedy.
Speaker 2: Like concrete too.
Speaker 3: Joel is that your dog.
Speaker 10: Mute that one?
Speaker 2: Go ahead, David, please find So.
Speaker 12: So what we were sort of fascinated by was how
Speaker 12: sort of the history of these materials to sort of
Speaker 12: tracked human civilization and how we are kind of simultaneously
Speaker 12: in desperate need of more of this and in desperate
Speaker 12: need of finding a way to clean up these industries.
Speaker 12: And each of these sort of industries faces their own
Speaker 12: different challenges with sort of finding the raw materials and
Speaker 12: finding ways to make it less destructive.
Speaker 3: All right, So we talked about building materials. There's again
Speaker 3: it's the city's double issue. So everything in it is
Speaker 3: about cities. It's a collaboration with Bloomberg City Lab Joel Weber.
Speaker 3: There's a story a column in here by Joshua Green.
Speaker 3: It's about how GOP legislators are increasingly imposing their economic
Speaker 3: and cultural priorities on left leaning municipalities, places where perhaps
Speaker 3: a lot of New Yorkersfornians have moved during the pandemic Nashville, Tennessee.
Speaker 3: What's the latest dispatch from Josh.
Speaker 8: So what's really.
Speaker 10: Interesting about this one was this, And this was a
Speaker 10: story that major props to Josh Bruce Deean for collaborating
Speaker 10: initially on Josh Green on this one with Josh Green
Speaker 10: on this one, but this tension between blue cities and
Speaker 10: red states, it really came to a head earlier this year,
Speaker 10: and we asked Josh to go to Nashville, where so
Speaker 10: much of this has really been culminating, and give us
Speaker 10: sort of a dispatch, because one interesting thing about this
Speaker 10: is that blue city red state relationship has been actually
Speaker 10: like an incredible economic arrangement that everybody's benefited from. But
Speaker 10: what we're beginning to see is that Red states are
Speaker 10: kind of cracking down and a certainly an authority on
Speaker 10: what heretofore been Democratic strongholds, and that alliances sort of
Speaker 10: or a relationship is sort of now in flux in
Speaker 10: a way that we're going to really have to be
Speaker 10: watching how this plays out, because GOP is looking for
Speaker 10: more and more ways to pick up not only like
Speaker 10: talking points that they can launch onto, but also ways
Speaker 10: that they can affect change, and targeting Blue city seems
Speaker 10: to be one of the ways that they can see
Speaker 10: immediate reactions, with which totally happened in Nashville. Even though
Speaker 10: a lot of this has been pushed back on since
Speaker 10: mister brucetein What did I miss in that description?
Speaker 11: That's a pretty good description. I think the thing that's
Speaker 11: interesting here is that, as Josh immediately found once he
Speaker 11: started calling around, was that this is actually an area
Speaker 11: where you've really seen the transformation of the two political
Speaker 11: parties play out. You know, in Washington, Congress isn't passing much,
Speaker 11: but one thing we've seen in recent years is that
Speaker 11: a lot of red state legislators have gotten a lot redder,
Speaker 11: and the makeup of the legislators in that Republican majority
Speaker 11: has gotten much different, more populist, more aggressive, especially cultural issues.
Speaker 11: At the same time that city level legislation is tackling
Speaker 11: really hot button issues. Criminal justice has become, you know,
Speaker 11: even more of a forefront over the last couple of years,
Speaker 11: issues around transgender rights. A lot of times, cities are passing,
Speaker 11: you know, things to expand those rights, and states are
Speaker 11: looking to crack back on that and so they have
Speaker 11: the power to do so. And it's playing out not
Speaker 11: only in Nashville, but in a lot of other places
Speaker 11: as well well.
Speaker 2: And you know, I want to bring you back in, David,
Speaker 2: because I do wonder you guys at City lab. You
Speaker 2: know what goes on in cities increasingly, I feel like
Speaker 2: coming out of the pandemic, you know, recent political cycles.
Speaker 2: George Floyd like the fabric of cities. Yes, it's the buildings,
Speaker 2: it's the structures, but politics is so much impacting the
Speaker 2: landscape of our nation cities.
Speaker 12: Well, absolutely, I mean, as Jah says, the dynamic that
Speaker 12: you see in Nashville is repeated a lot of different states.
Speaker 12: You know, Texas, West Coast cities, cities and sort of
Speaker 12: more conservative state lawmakers are tangling in Oregon, and uh,
Speaker 12: you know, it's it's a it's a phenomenon that predates
Speaker 12: our current political era. It's not new in that sense.
Speaker 12: It's also not a phenomena that's unique to the United States.
Speaker 12: You see variations on this in Europe, and you know,
Speaker 12: it's a it's a it's a it's a tension that
Speaker 12: has always sort of kind of been kind of woven
Speaker 12: into the landscape. The the the nature of urban life
Speaker 12: tends to require a certain set of policy solutions, and
Speaker 12: there is often a real kind of pushback from community
Speaker 12: members who don't see those policy solutions as reflecting their values.
Speaker 12: And that has manifested its way in all sorts of
Speaker 12: interesting and and troubling ways. It really kind of got
Speaker 12: weaponized in a dramatic way, certainly in the Trump era,
Speaker 12: but it's it's it's always been sort of kind of
Speaker 12: humming beneath urban relationships for you know, Millennia probably.
Speaker 10: Okay, I got one more thing I want to bring up,
Speaker 10: which as much as I talked about concrete to Josh,
Speaker 10: the other thing was, look like I want to I
Speaker 10: want to feel like cities are working, that they have answers,
Speaker 10: that they're trying to improve people's lives, and that or
Speaker 10: there are other people who have ideas to fix them.
Speaker 10: And you know, we started with this idea of real
Speaker 10: estate a little bit and Pat Clark did this element
Speaker 10: that we kind of turned into the first thing we
Speaker 10: had in ways to fix cities. And obviously we've spent
Speaker 10: a lot of time talking about the problems with commercial
Speaker 10: real estate and empty office space. And Pat came up
Speaker 10: Josh with such a novel idea rooted in a real
Speaker 10: estate listing that he saw what was the big takeaway
Speaker 10: that we all need to get hip with.
Speaker 11: Yeah, this was a really great insight from Pat. I
Speaker 11: mean I started bugging Pat about doing something about converting
Speaker 11: offices into apartments. Early on in this you know, it's
Speaker 11: something that we've been talking about a lot. It's hard
Speaker 11: to say something new about it because everyone said a
Speaker 11: lot about it, and so I kept bugging him, and
Speaker 11: eventually he said, well, I've talked to a couple of
Speaker 11: people who came up with this idea, like, why are
Speaker 11: we trying to make these things nice apartments? Why don't
Speaker 11: we just make them really crappy apartments in the same
Speaker 11: way that in the same way that in Soho in
Speaker 11: the sixties, you know, those sweatshops that they turned into lofts.
Speaker 11: Those weren't nice lofts, but people but tastemakers moved in
Speaker 11: and they loved them. And so the idea is, like,
Speaker 11: what if we can just make you know, the fluorescent
Speaker 11: lighting and the gray carpeting be sort of the drafty
Speaker 11: windows and the exposed brick of the you know, of
Speaker 11: the Soho of today.
Speaker 2: I love that because you're right, we spent so much
Speaker 2: time talking about it, and I just thought that take
Speaker 2: on it was incredible so much in this issue. Thank
Speaker 2: you all. I really appreciate it, and just incredible incredible issue,
Speaker 2: Credible cities issue. Joe Weber, editor of Bloomberg Business Week.
Speaker 2: Josha Bustein, Technology Editor Bloomberg Business Week, who really put
Speaker 2: this all together? Aloe with David Dudley, editor at Bloomberg
Speaker 2: City Lab, joining us out there in DC. Guys, thank you.
Speaker 8: Brother Marc.
Speaker 9: A journal.
Speaker 8: How about you let me drive?
Speaker 1: Oh no, no, no, no, honey, please, I'll do the
Speaker 1: riding gravels.
Speaker 6: Let's mate, I.
Speaker 2: Want to try it.
Speaker 12: It's a good question that try.
Speaker 1: This is the drive to the globe.
Speaker 6: Don coms me.
Speaker 1: I think we'll buy around it on Bloomberg Radio.
Speaker 2: All right, everybody, just for eighteen minutes left in today's
Speaker 2: a session and we're watching, you know, a market where
Speaker 2: you know, you read through the economic news and maybe
Speaker 2: investors once again thinking, okay, maybe the FED is getting
Speaker 2: near the end, because we've got a little bit of
Speaker 2: a rally. And what the S and P five hundred
Speaker 2: is it for our fourth.
Speaker 3: Data where we fourth n L forty five to fourteen?
Speaker 2: Yeah, so we're a both that forty eight forty five
Speaker 2: hundred mark.
Speaker 3: Okay, so much for the August doldrums, Carol. Month to date,
Speaker 3: the S and P's only down one point.
Speaker 1: What do you call them?
Speaker 2: Always fireworks in August at least the last I would
Speaker 2: say last five years, six years. I don't know.
Speaker 3: There's one more day of the month and we could
Speaker 3: we could potentially be you know, for the month.
Speaker 2: There's some drama. We did see yields back off a
Speaker 2: little bit. You here Charlie talking the numbers. Let's see
Speaker 2: what Hank Smith has to say about this environment. He's
Speaker 2: CIO of the individual and institutional wealth management firm Haverver Trust.
Speaker 2: He joins us on the phone from Bradner, Pennsylvania. Hank,
Speaker 2: good to have you back with us. How are you
Speaker 2: and how are you thinking about the market environment right now?
Speaker 8: Well, it's great to be with you. Good afternoon, and
Speaker 8: I am doing very well. Thank you. Look, this has
Speaker 8: been one of the most interesting years in my uh
Speaker 8: thirty eight years in this business. And you know there's
Speaker 8: that Wall Street added bull markets climb walls of worry,
Speaker 8: and that has never been more true than this year
Speaker 8: when you consider everything the market has overcome in terms
Speaker 8: of very elevated inflation at the beginning of the year,
Speaker 8: you know, the most aggressive said right, height cycle that
Speaker 8: we've experienced in thirty plus years. Also three bankruptcies and
Speaker 8: the potential for another banking crisis, and concerns about commercial
Speaker 8: loan repayments, concerns about student loan repayments, and the market
Speaker 8: has just seen its way through through it all. And look,
Speaker 8: we continue to remain pretty optimistic and but recognizing that
Speaker 8: we could very well Carol have a relatively flat rest
Speaker 8: of the year, but the broad market do pretty well.
Speaker 8: So in other words, that is the so called Magnificent
Speaker 8: seven stall out here, which they clearly need a breather.
Speaker 8: You could also see plenty of laggards pick up the flat.
Speaker 8: That's if the broad averages remain relatively flat.
Speaker 2: Can I say there is a point like, if you're
Speaker 2: an investor, at least on the equity I'm doing plain vanilla.
Speaker 2: You're looking at a Nasdaq one hundred that's up forty
Speaker 2: one percent so far this year, and you're looking at
Speaker 2: an S and P five hundred that's up seventeen percent.
Speaker 2: Mind you, I'm just doing the bigger, broader averages. You know,
Speaker 2: to kind of put it in the bank, take a
Speaker 2: money market or some kind of with you know, you
Speaker 2: look at what treasuries are yielding and just say I'm
Speaker 2: good in twenty twenty three, Like you can see why
Speaker 2: people might just take a breather.
Speaker 8: Absolutely, but look, small stocks offer tremendous opportunities. The equal
Speaker 8: weight that s and P five hundred is half of
Speaker 8: what the market calculated sm P five hundred, So there
Speaker 8: are plenty of opportunities. And and even in terms of valuation,
Speaker 8: the valuation of the market weighted cap s m P
Speaker 8: five hundred is skewed by those handful of tech stocks
Speaker 8: that uh, that are that are driving the valuation higher.
Speaker 8: But if you look at the equal way of sm
Speaker 8: P uh valuation, uh, it's much more reasonable.
Speaker 3: So where are the opportunities for the stocks that haven't
Speaker 3: yet had the room to run or haven't run yet
Speaker 3: this year?
Speaker 8: Well, I think, look, it'd be it'd be very healthy
Speaker 8: to see a broadening out of the market. And we
Speaker 8: saw a little bit of that in June, uh and
Speaker 8: then uh it was back to the magnificent seven driving
Speaker 8: the market. Uh, you know after after June. Uh. So
Speaker 8: I think there is opportunities both in uh, in healthcare,
Speaker 8: which has been a lagger, UH, in consumer staples which
Speaker 8: have been a lagger, and and and we have uh,
Speaker 8: we have pretty decent waitings in those two sectors where.
Speaker 2: Don't you want to be. Is it just those names
Speaker 2: that have really led the big outperformers. And I hesitate too,
Speaker 2: if I can just do a kind of a second
Speaker 2: question that every time everybody's like, stay away from the
Speaker 2: big tech that have led, and then they have another
Speaker 2: drive up that's significant.
Speaker 8: Right, and and and and so this year has been
Speaker 8: a mirror opposite of last year. And who would have
Speaker 8: predicted that after sustaining those very significant corrections, those the
Speaker 8: tech stocks would come roaring back. But it's hard to
Speaker 8: get excited about buying those stocks after the kinds of
Speaker 8: moves uh they've had, So we would we would caution
Speaker 8: investing in that area. Uh. And Plus it's it's hard,
Speaker 8: you know, if you're if you are trying to beat
Speaker 8: the index, you need to own more than seven percent
Speaker 8: in Apple and Microsoft. And if you're a fiduciary, that's
Speaker 8: very difficult. You don't you just don't buy that much
Speaker 8: in uh in two stocks.
Speaker 3: That's a really interesting point.
Speaker 12: Uh.
Speaker 3: Okay, So I guess my question is about those sort
Speaker 3: of unknown unknowns. What's out there that concerns you?
Speaker 8: Well, look, whenever you're growing a below trend line, as
Speaker 8: as this economy is right now, despite what the Atlanta
Speaker 8: Fed tracker is forecasting for the third quarter. You're you
Speaker 8: are susceptible to external shocks. The problem is you can
Speaker 8: never identify those external shocks. And certainly back in March
Speaker 8: with that mini crisis banking crisis, one would have thought
Speaker 8: at that time, oh, this is an external shock. And
Speaker 8: yet the market low or nearly the market low for
Speaker 8: this year was the day Silicon Valley Bank went bankrupt.
Speaker 8: And you could never have then said, let's buy stock.
Speaker 8: We're going to be up fifteen percent from here over
Speaker 8: the next handful of months. Yet that's exactly exactly what happened.
Speaker 8: So I think the concerns about the beginning of the
Speaker 8: repayment of student debt, it's a concern, but I don't
Speaker 8: think that's going to be a big factor that is
Speaker 8: going to affect the economy one way or the other.
Speaker 8: And people have been talking about it for months now,
Speaker 8: so that's not a big issue.
Speaker 2: Ten seconds, Hank new mind, put it in the equity market,
Speaker 2: put it in cash, put it in treasuries. If you
Speaker 2: had to pick the two those three, where do you
Speaker 2: do it?
Speaker 8: Well, it is as long as you're as long as
Speaker 8: your time frames three to five years put it in equity.
Speaker 2: Interesting, Okay, are you holding cash though a lot for
Speaker 2: your clients right now? Really quickly?
Speaker 7: Uh?
Speaker 8: Nook very little cash. But I can tell you the
Speaker 8: clients where we have a balance between dot com bongs
Speaker 8: have been very very happy with the driving.
Speaker 2: All right, good stuck, Pig Smith. Thank you as much
Speaker 2: as always, Cio of ha Her for trust. On the
Speaker 2: phone from Radnor, Pennsylvania.
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