WEBVTT - How the Pandemic Is Impacting Parenting 0:00:00.720 --> 0:00:03.720 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:03.800 --> 0:00:06.320 Jason Kelly. We're right here every day bringing you the 0:00:06.400 --> 0:00:11.160 latest news from the world's of business and finance, plus technology, politics, economics, 0:00:11.240 --> 0:00:14.280 all harnessing the power of Business Week reporters and editors. 0:00:14.440 --> 0:00:16.439 And of course Carol that's part of a team of 0:00:16.520 --> 0:00:19.959 twenty seven hundred journalists and analysts the more than a 0:00:20.040 --> 0:00:22.959 hundred and twenty countries and Jason. You can download Bloomberg 0:00:22.960 --> 0:00:26.079 Business Week on iTunes, SoundCloud, blo Bloomberg dot com. You 0:00:26.079 --> 0:00:28.280 can also listen to our radio show at two pm 0:00:28.320 --> 0:00:31.159 Eastern on Bloomberg Radio every weekday, or watch us on 0:00:31.200 --> 0:00:36.040 YouTube by searching Bloomberg Global News. Jina Martin Adams back 0:00:36.040 --> 0:00:40.040 with us. She is Bloomberg Intelligence Chief Equity Strategists, alongside 0:00:40.280 --> 0:00:44.360 Dave Wilson, Bloomberg Stock Editor, of course, the author of 0:00:44.400 --> 0:00:46.559 the chart and Stock of the Day. Dave, let me 0:00:46.600 --> 0:00:49.760 start briefly with you, what's the most important thing we 0:00:49.800 --> 0:00:53.040 need to understand about this market today. Well, it looks 0:00:53.120 --> 0:00:56.480 like the headline about the travel is getting at least 0:00:56.480 --> 0:00:59.320 a little bit of attention from stock investors. The S 0:00:59.360 --> 0:01:02.240 and P five is at its higher the day. Now 0:01:02.760 --> 0:01:05.560 you're talking up three tents and or percent. So that's 0:01:05.560 --> 0:01:07.720 just the kind of day it's been, not a whole 0:01:07.720 --> 0:01:10.960 lot of direction. And you look at the eleven main 0:01:11.040 --> 0:01:14.920 industry groups, you see communications services as a standout, and 0:01:14.959 --> 0:01:18.720 that's really Facebook in large measures. Shares are up six 0:01:18.800 --> 0:01:21.839 percent at the moment, so people are getting a little 0:01:21.840 --> 0:01:25.200 bit excited about that company. And then beyond that, Viacom 0:01:25.280 --> 0:01:29.240 CVS they had results out and they went over pretty well, 0:01:29.440 --> 0:01:33.200 unlike the figures that we saw from some of the 0:01:33.200 --> 0:01:37.760 company's media appears, uh Fox and Discovery Communications notably, those 0:01:37.760 --> 0:01:40.600 shares were down yesterday in the wake of their results. 0:01:41.160 --> 0:01:43.720 Viacom getting a much better reception. The shares are up 0:01:43.720 --> 0:01:46.840 three the moment, and from what I understand to the 0:01:46.880 --> 0:01:50.000 airlines are moving as well. On that news. American Airlines 0:01:50.040 --> 0:01:53.200 now up about four percent UM, so we're definitely seeing 0:01:53.240 --> 0:01:56.120 some reaction, no doubt about it, in that group as well. 0:01:56.120 --> 0:01:58.520 Delta's up about two point three percent. Hey, Gina, come 0:01:58.560 --> 0:02:01.960 on in on this conversation. I am curious to get 0:02:02.000 --> 0:02:05.400 your perspective because I feel like um increasingly so much 0:02:05.440 --> 0:02:08.760 of the Wall Street investment community is commenting on things 0:02:08.800 --> 0:02:12.120 like the elections, commenting on a vaccine approval and what 0:02:12.240 --> 0:02:16.000 it could mean for the financial markets. What's your analysis 0:02:16.000 --> 0:02:21.040 on this? Those are the things that are likely driving stacks. 0:02:21.040 --> 0:02:22.960 I mean, it's it's odd to be in the midst 0:02:23.000 --> 0:02:26.520 of earning season, the second heaviest reporting week in earning season, 0:02:27.240 --> 0:02:31.200 and see reactions to earnings as muted as they've seen 0:02:31.280 --> 0:02:33.080 so far. When we look at the earning season as 0:02:33.120 --> 0:02:37.440 a whole, we've had more than of SMP companies b 0:02:37.680 --> 0:02:41.800 reporting day earnings estimate targets. That's the best we've seen 0:02:41.880 --> 0:02:46.280 on record, our record since and yet the one day 0:02:46.280 --> 0:02:49.080 price action in excess of the index in response to 0:02:49.080 --> 0:02:52.560 those earning speeds is about half of average. So it 0:02:52.600 --> 0:02:55.280 does seem that, you know, even though we're beating expectations, 0:02:55.280 --> 0:02:58.919 even though we've honestly seen forward estimates start to move 0:02:59.000 --> 0:03:01.480 higher as well as we clearly had baked in maybe 0:03:01.480 --> 0:03:05.919 a little too much economic constraint in the earnings outlook, 0:03:06.440 --> 0:03:10.120 it doesn't seem that earnings are actually driving driving stocks. Um. 0:03:10.120 --> 0:03:12.160 I think it fits and starts that's been the case, 0:03:12.880 --> 0:03:15.079 But I do think that that's the reason why many 0:03:15.120 --> 0:03:17.640 analysts have started to focus on things like the upcoming 0:03:17.680 --> 0:03:21.440 election focus on the perspentage chances of getting a vaccine 0:03:21.440 --> 0:03:25.880 anytime soon. Uh. Certainly the fiscal policy efforts underway in 0:03:25.919 --> 0:03:29.480 Washington or are a huge question mark, but the market 0:03:29.480 --> 0:03:32.760 does seem to be anticipating some resolution to that in 0:03:32.800 --> 0:03:35.920 the positive sometime soon. So there does appear to be 0:03:35.960 --> 0:03:37.800 a lot of other things that are really driving stocks 0:03:37.880 --> 0:03:39.360 right now, even though we're in the midst of a 0:03:39.400 --> 0:03:42.760 really important earning season. Frank right right, Well, and this 0:03:43.000 --> 0:03:45.320 data dump that we're seeing, I mean, this is typical. 0:03:45.440 --> 0:03:48.920 It was all scheduled around. Uh. Employment also seems to 0:03:48.960 --> 0:03:51.520 be very front of mind. You. Yeah, I think that 0:03:51.560 --> 0:03:54.520 the economic numbers are are interesting as well, especially the 0:03:54.560 --> 0:03:57.440 initial claims numbers. I'm not surprised to see the market 0:03:57.480 --> 0:03:59.120 kind of thinking, well, what do we really make of 0:03:59.160 --> 0:04:01.600 these initial claims numbers in the midst of all this 0:04:01.680 --> 0:04:05.960 turmoil around fiscal policy claims? So is that merely just 0:04:06.120 --> 0:04:08.960 sort of gaming the system with respect to the fiscal 0:04:09.040 --> 0:04:14.840 policy expiration or the the extended unemployment claims expiration. And 0:04:15.040 --> 0:04:17.320 I do think to the markets sort of waffling around 0:04:17.360 --> 0:04:18.960 here trying to figure out, you know, where do we 0:04:19.000 --> 0:04:21.640 really go from here? And frankly, for the last couple 0:04:21.680 --> 0:04:26.279 of months, we've we've had to price in better economic data. 0:04:26.520 --> 0:04:30.200 So the sort of the impetus that the economic data 0:04:30.279 --> 0:04:33.240 is able to give the market at this stage, you 0:04:33.279 --> 0:04:36.080 have to have a really, really strong be to expectation 0:04:36.839 --> 0:04:39.000 in order for the market to really absorb that and 0:04:39.040 --> 0:04:42.600 move higher. All right, Jina Martin Adams, thank you so much, 0:04:42.640 --> 0:04:44.800 Chief Equity Strategies for Boom Re Intelligence. This is the 0:04:44.839 --> 0:04:48.120 busiest time of the quarter for you. We know because 0:04:48.160 --> 0:04:51.159 of all those earnings that you mentioned, Because regardless of 0:04:51.160 --> 0:04:53.800 whether investors are swinging one way or the other, you 0:04:53.800 --> 0:04:55.560 guys are doing a huge amount of work on it. 0:04:55.600 --> 0:04:58.640 So we really appreciate you taking sometime. Dave Wilson are 0:04:58.760 --> 0:05:02.040 thanks to you as well. Looking forward to the chart 0:05:02.080 --> 0:05:04.120 of the day, I've been looking at it, Carolin, trying 0:05:04.160 --> 0:05:06.960 to figure out like that there's a king element to it. 0:05:07.120 --> 0:05:09.240 So it could it be a Tom Petty situation, could 0:05:09.240 --> 0:05:11.760 be Elvis? Could it be Elvis. We're gonna see, We're 0:05:11.760 --> 0:05:14.919 going to see, could it be the Lion King? Continue? 0:05:14.920 --> 0:05:17.760 You are Disney exactly. We are a little Disney obsessed 0:05:17.760 --> 0:05:19.839 these days, and by we I mean me. You're listening 0:05:19.920 --> 0:05:23.760 to Bloomberg Business Week with Carol Masser and Jason Kelly 0:05:23.920 --> 0:05:27.000 on Bloomberg Radio. I gotta say, Jason and I always 0:05:27.000 --> 0:05:29.039 look forward to this next guest because he's definitely one 0:05:29.040 --> 0:05:30.719 of the voices we look forward to when it comes 0:05:30.720 --> 0:05:33.440 to talking about COVID. Nineteam Back with Us is Dr 0:05:33.480 --> 0:05:37.280 William Hazeltine. He is chairman and president of Access Health International. 0:05:37.320 --> 0:05:41.400 It's a nonprofit think tape. It's all about improving access 0:05:41.440 --> 0:05:44.080 to high quality and affordable health care for people everywhere. 0:05:44.360 --> 0:05:47.480 He also has this great living e book that came 0:05:47.520 --> 0:05:50.080 out this year. It's written to address questions about the 0:05:50.160 --> 0:05:53.360 virus from the perspective of different age groups. It's living 0:05:53.440 --> 0:05:56.839 because it's constantly being updated with new information. It's called 0:05:56.839 --> 0:05:59.479 a Family Guide to COVID. And that our Hazeltine joining 0:05:59.520 --> 0:06:02.320 us once again and on the phone. Um, nice to 0:06:02.360 --> 0:06:05.480 have you back with us. Um, where should we start? Like, 0:06:05.839 --> 0:06:07.840 tell me what you think is most important when we 0:06:07.880 --> 0:06:10.680 look at what's going on with the virus in the 0:06:10.800 --> 0:06:14.960 US globally and also the race to find some treatments 0:06:15.000 --> 0:06:18.240 and a cure, not a cure, bit a vaccine. Well 0:06:18.240 --> 0:06:22.440 that's a lot. Thank you. Very much. And let me 0:06:22.440 --> 0:06:25.279 mention that a new book, a new living e book 0:06:25.720 --> 0:06:30.240 has just arrived. It will be up later today. It's 0:06:30.640 --> 0:06:35.080 a COVID um. I got a COVID guide to school, 0:06:35.360 --> 0:06:37.960 back to school, a COVID Guide to back to school. 0:06:38.600 --> 0:06:42.880 And uh I mentioned it because that is the topic 0:06:43.000 --> 0:06:49.039 on Americans minds. Every parent and I'm a grandparent, and 0:06:49.200 --> 0:06:57.599 grandparents are absolutely upset, concerned, worried about what to do 0:06:57.880 --> 0:07:02.920 with their children going back to school. The preschoolers, the 0:07:03.360 --> 0:07:06.480 K through six and the sixth through twelve, and all 0:07:06.520 --> 0:07:09.920 those are very difficult in different issues. Not to mention 0:07:10.280 --> 0:07:14.560 college aid students too. And the shocking thing is is 0:07:14.640 --> 0:07:18.960 that we don't have guidance nationally and we don't have 0:07:19.080 --> 0:07:23.120 any consistent way of thinking about it. So what I've 0:07:23.160 --> 0:07:26.080 tried to do is think through how to give people 0:07:27.080 --> 0:07:29.640 just the basics for how to make a decision. We 0:07:29.760 --> 0:07:32.680 just don't have that. It's it's really shocking. The CDC 0:07:32.880 --> 0:07:35.960 doesn't give any good guidance. I've given you something that 0:07:36.040 --> 0:07:39.600 really surprised me. Our National Academy of Sciences, which is 0:07:39.640 --> 0:07:43.600 a National Academy of Medicine, of engineering. Every academy that 0:07:43.640 --> 0:07:47.400 we've got put together a panel. They looked at it, 0:07:47.760 --> 0:07:50.760 and the most shocking thing about that report, as they said, 0:07:51.280 --> 0:07:54.600 we just don't know and we don't have guidance about 0:07:54.600 --> 0:07:59.320 what to do. That was our national Academy. It is 0:07:59.640 --> 0:08:04.360 really upset it. And so what's the first what's the 0:08:04.400 --> 0:08:06.840 first couple of questions we should be asking as parents? 0:08:06.840 --> 0:08:10.000 Bill Well, I think the way to look at it 0:08:10.040 --> 0:08:13.160 is is to try to figure out what your risk is. 0:08:14.160 --> 0:08:18.200 And the first ratification for risk is how much infection? 0:08:18.360 --> 0:08:20.920 How much? How likely or do you run into somebody 0:08:20.960 --> 0:08:25.760 who's contagious. That's you know, people say transmission, it's really contagious. 0:08:25.760 --> 0:08:28.960 That's the word you should use. And how likely are 0:08:29.000 --> 0:08:31.160 you going to run into you or your child going 0:08:31.200 --> 0:08:34.360 to run into somebody contagious. And we give a guideline 0:08:34.440 --> 0:08:39.959 whether you're in green, yellow, orange, or red by how 0:08:40.000 --> 0:08:42.520 many people for a hundred thousand or in your zip 0:08:42.520 --> 0:08:45.840 code and the zip codes that they come from to 0:08:45.920 --> 0:08:50.960 work in your school, and that gives you a guideline 0:08:51.040 --> 0:08:54.000 of whether you're in a hurricane you should stay home 0:08:54.080 --> 0:08:57.679 in the basement, whether you're in a thunderstorm and you 0:08:57.720 --> 0:09:00.439 can stay home and not go out of the rain 0:09:00.520 --> 0:09:04.080 storm if you go out, if you're heavily equipped, uh, 0:09:04.280 --> 0:09:06.720 or it's a light rain and you really have to 0:09:06.760 --> 0:09:09.120 know where you're going and how well you'll be protected, 0:09:10.040 --> 0:09:11.960 or if you were lucky enough and there's nowhere in 0:09:11.960 --> 0:09:13.800 the country, we're really lucky enough. You have to be 0:09:13.840 --> 0:09:16.400 on a sunny day. If you're on a sunny day, 0:09:16.480 --> 0:09:18.640 And so that's the first thing. The second thing is 0:09:18.760 --> 0:09:23.440 know your personal risk. Aren't there any health issues? First 0:09:23.440 --> 0:09:27.800 of all, your child has like diabetes, like serious asthma, 0:09:28.400 --> 0:09:31.480 like obesity, or that you have that the child brings 0:09:31.520 --> 0:09:35.920 it back, or anybody living with you, like your parents, 0:09:36.760 --> 0:09:39.880 or they're grand the child's grandparents. And the third and 0:09:39.960 --> 0:09:43.960 this is a lot harder to judge what that school 0:09:44.080 --> 0:09:47.600 is doing. And for that you as a parent have 0:09:47.800 --> 0:09:50.760 to take the initiative and go out and look at 0:09:50.800 --> 0:09:54.000 what that school is doing. Do you really have confidence 0:09:54.040 --> 0:09:56.400 in the people there? What is the plant like is 0:09:56.440 --> 0:09:59.240 an old, broken down facility as a brand new facility. 0:09:59.480 --> 0:10:02.040 What's the are handling like? What are they telling you? 0:10:02.200 --> 0:10:05.440 Are they dividing the kids up into small groups? Do 0:10:05.559 --> 0:10:09.760 they have face mass protection? Do they separate the children adequately? 0:10:10.120 --> 0:10:12.560 Those are things you as a parent have a responsibility 0:10:12.600 --> 0:10:16.440 to do before you said, you're killed out there, because 0:10:16.720 --> 0:10:20.720 no matter what you're hearing from national news, kids do 0:10:20.840 --> 0:10:24.360 get infected. There's something that else that I think we 0:10:24.440 --> 0:10:28.319 have to demystify about the virus. This is a cold virus. 0:10:29.280 --> 0:10:32.160 It does a lot more damage than most cold viruses. 0:10:32.200 --> 0:10:35.240 But it's just like the colds you get every season. 0:10:35.600 --> 0:10:38.199 In fact, one third of the colds you get a coronaviruses. 0:10:38.840 --> 0:10:40.360 We know how you get a cold. You send your 0:10:40.400 --> 0:10:42.079 kid to school when it comes back with a cold. 0:10:42.880 --> 0:10:46.440 That's not new. This is and one of those colds, 0:10:46.520 --> 0:10:48.319 one of the three colds you get every year, is 0:10:48.320 --> 0:10:54.440 a coronavirus called So that's I think that's basically the 0:10:54.480 --> 0:10:56.640 story of this book is just trying to give people 0:10:57.360 --> 0:11:01.720 simple guidance of how to imagine what their risk is 0:11:02.160 --> 0:11:04.880 and then if the risk is too high, you just 0:11:05.040 --> 0:11:07.760 don't send your kid to school. Right you are listening 0:11:07.760 --> 0:11:10.320 to Bloomberg Business Week, Jason Kelly, Carol Master. Let's get 0:11:10.360 --> 0:11:12.920 right back to our conversation with Dr William Haseltine. He 0:11:12.960 --> 0:11:15.520 is chairing president of Access Health International, author of a 0:11:15.520 --> 0:11:18.400 couple living e books. They are out there and being 0:11:18.480 --> 0:11:21.760 updated practically hour by hour, it feels like because that's 0:11:21.760 --> 0:11:24.520 how fast this is moving to your point. Carol One 0:11:24.600 --> 0:11:27.679 is a Family Guide to COVID Questions and Answers for parents, grandparents, 0:11:27.679 --> 0:11:31.320 and children, and newly released as of today, a COVID 0:11:31.320 --> 0:11:36.360 Back to School Guide Questions and Answers for parents and students. So, Bill, 0:11:37.320 --> 0:11:39.280 we could talk all day about back to school, but 0:11:39.480 --> 0:11:41.960 I do want to ask you about, you know, maybe 0:11:42.000 --> 0:11:45.439 back to work if I can, because these are intertwined. 0:11:45.440 --> 0:11:47.800 Of course, we need kids to go back to school, 0:11:47.960 --> 0:11:50.280 we need them to be learning in some form or fashion. 0:11:50.360 --> 0:11:52.680 But what have you learned is you talk to people 0:11:52.720 --> 0:11:55.560 about what it's going to take for people to feel 0:11:55.600 --> 0:11:59.720 good about going back to the office. You know, it's 0:12:00.040 --> 0:12:03.960 really surprising that it's almost exactly the same questions that 0:12:04.040 --> 0:12:05.960 you would ask about sending of your kid to school. 0:12:06.320 --> 0:12:08.800 You're more concerned about the kid because you think you 0:12:08.800 --> 0:12:13.000 yourself have more control, but in fact, when you really 0:12:13.000 --> 0:12:15.240 think about it, you really don't have control of whom 0:12:15.280 --> 0:12:17.760 you meet. You have control of what you can do 0:12:17.840 --> 0:12:20.880 to protect yourself, but you don't know who that other 0:12:20.920 --> 0:12:24.400 person is, and therefore the same kind of rules apply, 0:12:25.000 --> 0:12:27.720 which is how much is the infection in your area, 0:12:29.720 --> 0:12:32.160 what is your personal risk and the risk of those 0:12:32.200 --> 0:12:35.640 you live with, and then how much is your business 0:12:36.280 --> 0:12:40.200 doing what it must do given the conditions that there is. 0:12:40.880 --> 0:12:45.160 I would say there's one area that is driving this epidemic. 0:12:45.200 --> 0:12:47.160 There is three or four, but one that I'd like 0:12:47.240 --> 0:12:49.319 to focus on for just a minute. Is there a 0:12:49.400 --> 0:12:51.280 lot of people who have to go to work, either 0:12:51.320 --> 0:12:55.720 their essential workers or they don't. Can't put food on 0:12:55.720 --> 0:13:00.199 the table if they don't go to work, and they 0:13:00.200 --> 0:13:02.520 don't have that choice of making the decision that you 0:13:02.640 --> 0:13:04.600 or I might have about I'm going to stay home, 0:13:04.679 --> 0:13:06.040 I'm not going to go to work, or have to 0:13:06.080 --> 0:13:09.240 do this. For those people, it's so important to make 0:13:09.280 --> 0:13:13.080 sure their work environment is safe. That's the responsibility of 0:13:13.080 --> 0:13:16.480 the organization that they work for to make sure that 0:13:16.559 --> 0:13:19.440 the people that have to work there are safe and 0:13:19.520 --> 0:13:24.240 that is enforced. I think uh, let's put it say, 0:13:24.520 --> 0:13:28.360 uh irreproducible across the country. There are some places that 0:13:28.400 --> 0:13:30.600 are going to be good about that and other places 0:13:30.600 --> 0:13:33.520 that aren't, and that is going to keep driving the infection. 0:13:33.559 --> 0:13:36.720 It's on all of us to put the pressure on 0:13:36.760 --> 0:13:42.880 our local governments to make sure that all workplaces are safe, 0:13:43.080 --> 0:13:46.200 even those places where people have to go to work, 0:13:46.240 --> 0:13:50.960 like the fire department, despite the fact that there is 0:13:51.000 --> 0:13:54.480 an epidemic raging. So that's something we all have to 0:13:54.520 --> 0:14:00.880 work with because it's protecting ourselves. Protecting them is protecting us. Yeah, 0:14:00.920 --> 0:14:02.800 it goes back to I feel like Bill such a 0:14:02.840 --> 0:14:06.040 big thing that I guess maybe we're all realizing the 0:14:06.040 --> 0:14:09.840 importance of community. Right. It's not just about us as individuals, 0:14:09.840 --> 0:14:13.400 but it's about taking care of really our community at large, 0:14:13.520 --> 0:14:15.800 and that's what we need to be thinking about. I 0:14:15.880 --> 0:14:18.240 have to ask you, though, I am still kind of 0:14:18.280 --> 0:14:20.800 struck by Governor Cuomo on Monday. I was away for 0:14:20.840 --> 0:14:24.240 a week, came back and he was very strident, very critical, 0:14:24.440 --> 0:14:28.280 talking about the potential of basically the federal governments. You 0:14:28.320 --> 0:14:29.640 need to come out and say we made a mistake, 0:14:29.720 --> 0:14:31.240 we need to do a redo, we need to shut 0:14:31.280 --> 0:14:34.600 down again. Do you would you be in favor of 0:14:34.760 --> 0:14:37.920 shutting down the country as a whole, like we saw 0:14:37.920 --> 0:14:41.240 in other countries where they have seemed to get ahead 0:14:41.240 --> 0:14:43.440 of the virus better than the US. Would you be 0:14:43.480 --> 0:14:46.360 in favor of that. I'm not in favor of shotting 0:14:46.400 --> 0:14:48.600 down the whole country, but I would be in favor 0:14:48.600 --> 0:14:52.040 of showing a place like Houston and most of Texas down, 0:14:52.160 --> 0:14:55.840 or most of Florida town, or most of California Lesa 0:14:55.920 --> 0:14:59.040 southern half of California town. You have to be aware 0:14:59.040 --> 0:15:02.840 of what's going on, and if you aren't in control, 0:15:03.040 --> 0:15:07.600 which we're not in control of rising epidemics around the country, 0:15:07.840 --> 0:15:11.240 you've got to shut things down for five to six weeks. 0:15:11.240 --> 0:15:14.080 But that's not enough. You have to take a leaf 0:15:14.200 --> 0:15:16.920 out of what we learned from the Chinese. You know, 0:15:17.400 --> 0:15:20.680 when there are sixty thousand people a day being infected 0:15:20.680 --> 0:15:24.480 in America, there are fifty people a day being infected 0:15:24.480 --> 0:15:28.960 in China. Let me say that again, sixty thousand Americans 0:15:29.120 --> 0:15:34.120 get infected on some days and fifty people in China. 0:15:34.600 --> 0:15:38.960 It can be done, and it's not just shutting things down. 0:15:39.640 --> 0:15:44.600 It's making sure you contact Grace and then mandatory isolation 0:15:45.080 --> 0:15:50.400 for all those exposed, not even infected exposed. How to 0:15:50.400 --> 0:15:56.040 do it. It's not magic. We don't do anything like that, 0:15:56.160 --> 0:15:58.960 nor does any European country. And that's why when you 0:15:59.000 --> 0:16:02.240 look at Europe, they haven't controlled this. You can blow 0:16:02.280 --> 0:16:05.400 out of control, just like it did here at any 0:16:05.440 --> 0:16:10.120 moment all throughout all right, Well, always good to catch 0:16:10.160 --> 0:16:12.840 up with you, and you're totally right. We're learning more 0:16:12.880 --> 0:16:16.840 and there are some simpler solutions to this, UH, and 0:16:17.160 --> 0:16:19.160 a lot of it comes down to how we're acting 0:16:19.400 --> 0:16:22.080 with each other and as a community, as you said, Carol. 0:16:22.280 --> 0:16:25.360 Dr William Hasl teen, Chair President of Access Health International. 0:16:25.480 --> 0:16:27.320 Check out his books, a COVID Back to School Guide, 0:16:27.320 --> 0:16:30.600 it's out today, Questions and answers for parents and students. 0:16:30.640 --> 0:16:34.160 You're listening to Bloomberg Business Week with Carol Masser and 0:16:34.280 --> 0:16:38.720 Jason Kelly on Bloomberg Radio. This is a story that 0:16:38.800 --> 0:16:43.600 brings so many things that we're interested in together, Carol, 0:16:43.800 --> 0:16:49.120 totally state of healthcare, private equity, big money, and so 0:16:49.160 --> 0:16:52.280 many more and not the least of which great journalism 0:16:52.280 --> 0:16:54.320 and Bloomberg Business Week we're happy to have with us. 0:16:54.400 --> 0:16:58.440 Bloomberg News Senior editor John Heckinger on this story along 0:16:58.520 --> 0:17:02.080 with Bloomberg Business Week under Joel Weber. So Joel t 0:17:02.280 --> 0:17:06.600 this up for us, so John Um and Sabrina Vener, 0:17:07.520 --> 0:17:10.920 who wrote the story together. Um UH serviced a little 0:17:10.920 --> 0:17:14.879 bit ago UM about a network of hospitals for profit 0:17:14.960 --> 0:17:20.600 hospitals UH primarily in Massachusetts called Steward and when UM 0:17:20.640 --> 0:17:22.679 they kind of started doing some reporting. But it was 0:17:22.840 --> 0:17:24.520 kind of interesting to me for a lot of the 0:17:24.520 --> 0:17:29.480 reasons that you said, Jason, the one big one being that, um, 0:17:29.520 --> 0:17:34.800 you know, pretty noteworthy UM uh private equity shop a 0:17:34.840 --> 0:17:38.920 Cerberusts got involved about a decade ago and what what 0:17:38.920 --> 0:17:42.800 what what the hospitals look like before and after? That 0:17:42.960 --> 0:17:45.800 has been pretty remarkable. And obviously the backdrop to all 0:17:45.840 --> 0:17:49.560 of this is there's a pandemic raging UM and John, 0:17:49.640 --> 0:17:54.080 so what what what did your reporting reveal? Well, as 0:17:54.160 --> 0:17:56.720 as he was saying, these hospitals were struggling back in 0:17:56.760 --> 0:17:59.800 two thousand and ten when Cerberus, the private equity for 0:18:00.080 --> 0:18:03.720 bought them UM and what we what we found is 0:18:03.760 --> 0:18:08.399 that UM, the the for profit chain, did invest a 0:18:08.440 --> 0:18:11.879 fair amount of money and sort of sprucing up the hospitals, 0:18:11.880 --> 0:18:14.120 but that many of the workers say that they were 0:18:14.200 --> 0:18:18.800 kind of short changed on staffing and maintenance and UM 0:18:19.640 --> 0:18:23.440 so once the pandemic hit, UM, they felt like they were, 0:18:23.480 --> 0:18:26.320 you know, even more exposed because they were just so 0:18:26.320 --> 0:18:30.440 so many patients and not enough nurses. UM. So we 0:18:30.440 --> 0:18:38.399 talked about the mouth role. That's right, Well, the story 0:18:38.440 --> 0:18:42.560 begins on morning of May tenth, when a mouse wandered 0:18:42.560 --> 0:18:45.920 into a transformer and shorted out the electricity and left 0:18:46.119 --> 0:18:49.439 UM a building largely in the dark, and the nurses 0:18:49.480 --> 0:18:52.600 it kind of represented kind of the sort of penny 0:18:52.640 --> 0:18:57.080 pinching ways of the company that had bought their beloved 0:18:57.080 --> 0:19:01.480 hospital UM. And so that's kind of became a symbol 0:19:01.520 --> 0:19:04.640 for many of them about why they were so concerned. 0:19:05.320 --> 0:19:07.360 And it wasn't just a building, Like keep in mind, 0:19:07.480 --> 0:19:11.320 this is early maze. The pandemic is happening. What happened 0:19:11.320 --> 0:19:14.680 to be there happened to be COVID patients throughout the hospital, 0:19:15.280 --> 0:19:18.800 and what ensued from there, well, what happened is that 0:19:18.960 --> 0:19:21.679 because there was no backup power in sort of this 0:19:21.880 --> 0:19:24.520 uh one unit where they were caring for patients, kind 0:19:24.520 --> 0:19:27.760 of keeping them separate from the COVID nineteen patients there 0:19:27.880 --> 0:19:30.439 just had to move those patients, the uninfected patients up 0:19:30.680 --> 0:19:34.000 into a into an IC that was packed with COVID patients. 0:19:34.200 --> 0:19:36.639 And as one nurse told us, they they sort of 0:19:36.640 --> 0:19:40.240 found it really kind of terrifying, and you know, they 0:19:40.240 --> 0:19:43.919 felt that I could potentially patients at risk. So I 0:19:43.920 --> 0:19:45.480 guess what I want to ask you, is, should we 0:19:45.520 --> 0:19:48.720 blame Servius for all of this? Did they not kind 0:19:48.760 --> 0:19:52.600 of make the changes, make the investments that one might 0:19:52.640 --> 0:19:57.159 have expected or hoped for. Well, I mean, to me, 0:19:57.240 --> 0:19:59.679 the main sort of one of the themes of the 0:19:59.720 --> 0:20:03.800 store is is kind of the magic of private equity 0:20:03.800 --> 0:20:07.760 did um Basically the way it was set up is 0:20:07.800 --> 0:20:10.800 that Cerberus very early on kind of guaranteed that it 0:20:10.800 --> 0:20:13.360 would make several times the amount of money that it invested. 0:20:14.440 --> 0:20:19.400 And whatever happened, whether the hospitals, you know, we're struggling 0:20:19.480 --> 0:20:23.280 or whether they were succeeding wildly, Um, they would no 0:20:23.320 --> 0:20:25.600 matter what, make their make their money. And so it's 0:20:25.680 --> 0:20:27.919 kind of that's really what we were looking at. I mean, 0:20:28.000 --> 0:20:31.200 there's no question that that Serbers and Stewart did make 0:20:31.240 --> 0:20:35.159 investments in the hospital, but at this time, even before 0:20:35.200 --> 0:20:38.159 the pandemic, they were struggling financially. So you have this 0:20:38.240 --> 0:20:42.320 contrast between how the hospitals are operating and how much 0:20:43.119 --> 0:20:46.879 how much their investors have profited. You know, John, I 0:20:46.920 --> 0:20:50.320 feel like this is such terrific reporting by you and Sabrina, 0:20:50.400 --> 0:20:52.359 and it really cuts to the core of one of 0:20:52.400 --> 0:20:55.320 the biggest issues I feel like we are facing when 0:20:55.320 --> 0:20:57.680 it comes to Wall Street, when it comes to private equity, 0:20:57.920 --> 0:21:01.239 when it comes to corporate responsibility in many ways, and 0:21:01.280 --> 0:21:03.600 I think it's brought to the FORO so much more 0:21:03.640 --> 0:21:06.560 because of this pandemic that we're living in, which is 0:21:07.320 --> 0:21:11.520 essentially at what cost are you making your profit? And 0:21:11.560 --> 0:21:14.520 I think that's it feels especially true in the healthcare 0:21:14.560 --> 0:21:18.000 arena because based on reporting you've done, and Sabrina Wilmer, 0:21:18.359 --> 0:21:20.560 your co author has done, and Heather Prolberg on the 0:21:20.600 --> 0:21:23.520 private equity team, I mean this is a theme that 0:21:23.640 --> 0:21:27.840 carries throughout the American healthcare system, which is, you know, 0:21:27.920 --> 0:21:31.240 private equity sort of coming in and seeing the ability 0:21:31.280 --> 0:21:34.080 to make money by cutting costs, and in some cases 0:21:34.119 --> 0:21:37.680 it feels like cutting corners. And one of the other 0:21:37.680 --> 0:21:40.760 issues is that, you know, there was there was concern 0:21:40.840 --> 0:21:43.960 that private equity backed companies were getting a bailout money 0:21:44.040 --> 0:21:47.560 right and and that and did did in fact happen 0:21:47.600 --> 0:21:51.200 to hospitals that were backed by private equity, including including 0:21:51.240 --> 0:21:54.920 Stewart Um. They got something like four hundred million dollars 0:21:54.640 --> 0:21:58.760 in loans from the package, another hundred million dollars in grants. 0:21:59.200 --> 0:22:01.040 And so I think the you know, the question now 0:22:01.080 --> 0:22:04.639 that sort of Congress is looking at is um you know, 0:22:06.359 --> 0:22:09.080 you know Wall Street was supposed to be a source 0:22:09.080 --> 0:22:11.760 of money for you know, for private equity, and should 0:22:11.800 --> 0:22:16.720 all these companies be getting beginning taxpayer bailouts? John, you know, 0:22:16.840 --> 0:22:18.560 one thing I just want to kind of bring it 0:22:18.640 --> 0:22:23.080 back to is ultimately um uh Cerberus was able to 0:22:23.080 --> 0:22:26.760 to kind of exit uh somewhat and and walk away 0:22:27.480 --> 0:22:29.960 with what what the where do things stand and how 0:22:30.000 --> 0:22:34.160 could things develop um in the months and years to come? Well, 0:22:34.200 --> 0:22:38.040 Serbs put in about a quarter of a billion dollars 0:22:38.160 --> 0:22:45.320 and all told, um Cerberuss investors tripled um tripled their money. 0:22:45.400 --> 0:22:50.040 And over the last in May, um Cerberus sort of 0:22:50.040 --> 0:22:52.960 started backing away from the investment and gave control to 0:22:53.040 --> 0:22:57.560 the doctors who are running the company. But they still 0:22:57.640 --> 0:23:01.280