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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on Affo, cardplay and Android

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Speaker 2: Auto with the Bloomberg Business App. Listen on demand wherever

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Speaker 2: you get your podcasts, or watch us live on YouTube.

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Speaker 3: The real data was the June number for PCE. This

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Speaker 3: is what the FED looks at, personal income up two

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Speaker 3: tenths of one percent, spending up three tenths of one percent,

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Speaker 3: holding up. You also had a core PCE on a

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Speaker 3: month on month coming in just two tenths of one

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Speaker 3: percent and two point six percent year on year.

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Speaker 4: So they say this is status quo.

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Speaker 1: John Tucker, how goldly lockxy?

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Speaker 4: Is this I mean?

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Speaker 3: Or is it just a case of confirmation bias? Like

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Speaker 3: you see what you want to see? Yeah, let's have

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Speaker 3: someone who might have an opinion on that one. Lauren

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Speaker 3: Saylor Baker is economists and senior consulting speaker at ITR

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Speaker 3: Economics on the data. Is this data like a see

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Speaker 3: what you want to see? Or is this a goldilocks

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Speaker 3: for real.

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Speaker 4: Result to be?

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Speaker 5: This is not confirmation bias, as we got the GDP

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Speaker 5: numbers yesterday. The economy is still holding up, very resilient,

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Speaker 5: inflation finally coming down. It was a little more persistent,

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Speaker 5: a little stickier than the FED wanted to see at

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Speaker 5: the start of the year. But all of the most

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Speaker 5: recent months of data giving them what they need to start.

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Speaker 5: Cuts in September.

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Speaker 1: All right, cuts in September. What about July thirty? First

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Speaker 1: we heard from Bill Dudley, even Mohammad al Arian Bloomberg

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Speaker 1: columnists saying that they should get it done with and

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Speaker 1: get it done soon.

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Speaker 5: I think that's the wishful thinking in the room. I

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Speaker 5: do not expect the FED to be moving in their

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Speaker 5: meeting next week. If we could accuse the FED of

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Speaker 5: one thing, it would probably not be cutting rights too

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Speaker 5: soon in this cycle.

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Speaker 3: What do you think that the well, what are we

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Speaker 3: gonna learn? Though, Like, Okay, they don't want to cut

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Speaker 3: too soon. But to John Tucker's point, I get next

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Speaker 3: week might be pushing a little bit. What else are

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Speaker 3: we going to learn from next week until September that

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Speaker 3: will really cement anything. It's just going to be the

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Speaker 3: same trajectory, right.

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Speaker 4: Well, that's their hope.

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Speaker 5: So the FED really does want The word they're using

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Speaker 5: is confidence, and to them that just means more months

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Speaker 5: of data, additional data points coming in, so they don't

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Speaker 5: want to move too quickly. I mentioned very strong GDP

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Speaker 5: numbers that came out yesterday that will very likely be

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Speaker 5: revised in future releases. So they just want to see

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Speaker 5: that the inflation, as I mentioned, has been more persistent,

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Speaker 5: has been stick here, that it isn't starting to creep

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Speaker 5: back up by the end of the summer. Again, I

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Speaker 5: think it's moving in the right direction finally, But because

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Speaker 5: it took so long for us to get here. We

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Speaker 5: had been on a nice smooth disinflationary track and then

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Speaker 5: we hit that three three and a half percent range

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Speaker 5: and things went much more sideways. So the Fed just

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Speaker 5: wants to be sure this isn't a blip. We've had

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Speaker 5: a couple of months of good data. They want to

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Speaker 5: see a couple more.

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Speaker 1: Well, there's another sign to their policy mandate. Isn't there

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Speaker 1: and what's happening on that it has been there?

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Speaker 6: There is?

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Speaker 5: Yeah, Yes, the labor market is actually something they had

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Speaker 5: wanted to see. Wage inflation cool. If we separate goods

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Speaker 5: inflation out from service inflation, that good side of things

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Speaker 5: is well under control. It has been for some time.

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Speaker 5: Now it's the service side that's been held up by

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Speaker 5: a very very tight labor market, so they're watching again.

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Speaker 5: Cooling labor has really been expected. Our labor market was

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Speaker 5: just on fire for the past couple of years. I

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Speaker 5: expect long term we have a floor under labor market activity.

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Speaker 5: We're starting to see the tide shift back in flavor of,

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Speaker 5: you know, a slightly looser market at the moment. I

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Speaker 5: don't think we're going to go too far that way though.

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Speaker 5: It's just a demographic issue. We have baby boomers, that

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Speaker 5: huge generation finally retiring. We don't have a huge glot

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Speaker 5: of workers waiting on the sidelines or aging into the

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Speaker 5: workforce at this point, so the numbers aren't going to

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Speaker 5: materially rebalance this little bit of loosening in twenty twenty four.

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Speaker 5: But I think that's a temporary trend.

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Speaker 1: Well what happens, What's what happens more quickly, when labor

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Speaker 1: starts to cool. Does that really really start to cool?

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Speaker 1: Because it also affects personal spending as well.

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Speaker 5: Sure, again, I don't think it really really starts to cool.

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Speaker 5: Labor has been supporting that personal spending component, which again

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Speaker 5: about two thirds of GDP driven by consumer spending, so

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Speaker 5: that is the floor under economic activity this time around.

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Speaker 5: We do see some echo effects from the pandemic still

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Speaker 5: playing out in the labor market. Because things got so

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Speaker 5: tight in that twenty one twenty two time frame, it

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Speaker 5: drew a lot of folks into the labor market. So

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Speaker 5: as we look at things like labor force participation rates

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Speaker 5: for primeage workers, those are at twenty plus year highs

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Speaker 5: right now. Again, we've brought more of those workers back

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Speaker 5: to the workforce. The risk now is if we start

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Speaker 5: to see layoffs or even if we just see more

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Speaker 5: folks entering again. I don't think there are too many

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Speaker 5: of them left on the sidelines, but that could pull

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Speaker 5: down some of that, say unemployment rate. I don't think

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Speaker 5: the fundamental drivers are there, and I think the ones

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Speaker 5: that we're seeing are again a very temporary shoe focused

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Speaker 5: on twenty twenty four, twenty five and beyond. Looks like

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Speaker 5: that tightness will just be grinding tighter.

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Speaker 3: Still, going back to the inflation point for a moment,

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Speaker 3: we have seen freight rates kind of start to move

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Speaker 3: a lot higher. We heard from Chipotle that their costs

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Speaker 3: are really starting to increase, Like they singled out the

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Speaker 3: price of avocado. And I can appreciate that some of

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Speaker 3: these are idiosyncratic, but is there a danger that certain

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Speaker 3: type of inflation that we felt was done will start

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Speaker 3: coming back.

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Speaker 5: We will always see pockets of inflation, I mean avocado specifically.

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Speaker 5: If you look at those trade routes, we get these

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Speaker 5: odd kind of one off events. So weather events. There's

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Speaker 5: been a drought in the Panama Canal that is keeping

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Speaker 5: ships from getting through. That's really increasing the time and

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Speaker 5: the cost of that journey. So I from an economic

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Speaker 5: fundamental point of view, I wouldn't say that's the trend,

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Speaker 5: but yes, weather events, these kind of black swan events. Obviously,

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Speaker 5: geopolitics that is the big one right now. I would

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Speaker 5: not want to make any predictions on that front. That's

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Speaker 5: not my ex for tease. But generally, if we look

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Speaker 5: at major industrial commodity prices right raw material cost most

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Speaker 5: of those are still below the year ago level. They're

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Speaker 5: trending much more sideways than outright rise or decline. So

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Speaker 5: I hope that's a breath of relief after a few

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Speaker 5: years of very strong volatility. But we'll always be able

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Speaker 5: to cherry pick those examples.

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Speaker 1: You know what, I haven't looked at a long time

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Speaker 1: and just look at the yield curve, the inversion between

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Speaker 1: twos and tens. It's less invertity. What yeah, what does

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Speaker 1: that tell you?

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Speaker 5: So the yield curve, it's a great rule of thumb

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Speaker 5: that yield curb inversions tend to precede a recession. This

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Speaker 5: time around, clearly that has not been the case. We've

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Speaker 5: been inverted for what two years now, are going on

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Speaker 5: two years now, it's.

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Speaker 1: Just eighteen basis points separation.

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Speaker 5: Well, we like to see that come under control. Looks

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Speaker 5: like it might normalize sooner than later, but that was

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Speaker 5: never a guarantee. We've had several historical cases, so a

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Speaker 5: lot of precedent for an inverted yield curve with no

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Speaker 5: following recession.

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Speaker 2: So I think.

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Speaker 5: That's a funroll of thumb. It certainly gives us a

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Speaker 5: great look into, you know, where the market is expecting

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Speaker 5: things to trend, but not an iron cloud guarantee. And again,

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Speaker 5: I think the outlier this time around, what really kept

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Speaker 5: us out of that GDP recession was the labor side

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Speaker 5: of things. That tight labor market supporting the consumer.

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Speaker 4: All right, Lauren, thanks a lot, We really appreciate it.

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Speaker 3: Lauren Zadelbaker is economists and senior consulting speaker at ITR Economics.

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Speaker 4: Thank you very much.

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Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 2: Auto with the Bloomberg Business at You can also listen

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Speaker 2: Just say Alexa play Bloomberg eleven thirty.

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Speaker 3: There was another story that is starting that was reading

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Speaker 3: high that was a surprise to many, and that is

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Speaker 3: the se SEE suing Andrew Left of committing fraud through

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Speaker 3: stock trades, social media posts, and research reports. This is

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Speaker 3: SEC's biggest move yet in a year's long crackdown against

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Speaker 3: traders who tout these bearish bets. Joining us now is

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Speaker 3: Tom Schoenberg, a Bloomberg senior reporter.

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Speaker 4: Tom. Can you walk us through what we know about

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Speaker 4: the suit?

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Speaker 1: Well, first of who is mister Left?

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Speaker 4: Oh, sorry, who's mister Left?

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Speaker 6: Andrew Left is a famed short seller. He has a

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Speaker 6: you know, website, Citron Research, and he's been making sort

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Speaker 6: of bearish bets for years of kind of a real, real,

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Speaker 6: sort of well known voice in stock trade.

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Speaker 3: So what was the problem because I mean short sellers,

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Speaker 3: long long guys come on, they.

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Speaker 4: Talk about the stocks they like.

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Speaker 3: Short sellers come on, they talk about what they don't

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Speaker 3: like about the stock, and they have positions on that

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Speaker 3: benefit if the stock goes down. But we know all

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Speaker 3: of this, So what was the specific problem with an

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Speaker 3: your Left?

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Speaker 6: So so what's happening here is both we've had both

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Speaker 6: the SEC and the d o J. Now the criminal

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Speaker 6: case alleging that Andrew Left was essentially not trading on

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Speaker 6: the way he was telling the public he was going

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Speaker 6: to be traded, he would essentially profit from going out

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Speaker 6: either releasing a report or tweets or other social media

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Speaker 6: interviews saying company stock, what should be valued at x

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Speaker 6: and as everyone as as the market moved to that,

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Speaker 6: he was immediately getting out and sort of making a

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Speaker 6: profit on those sort of you know, short term stock movements.

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Speaker 1: So saying one thing and doing another, basically.

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Speaker 6: That's correct, that's according to the government.

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Speaker 1: Yet this is something that's been kind of plaguing this

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Speaker 1: industry for a while, isn't it.

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Speaker 6: Well, this is obviously you know, uh, you know, the

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Speaker 6: mean stock frenzy from the about three years ago, you know,

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Speaker 6: caused sort of a longer, deeper look into this, both

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Speaker 6: by you know, Congress and that as we're seeing here

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Speaker 6: the Justice Department in the SEC, and you know, it

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Speaker 6: looks like they're looking at conduct, you know, conduct in

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Speaker 6: both of these cases go as far back as twenty eighteen,

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Speaker 6: and with the Justice Department saying as recent is October

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Speaker 6: twenty twenty three.

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Speaker 4: So this, this conversation happens at home like every six months.

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Speaker 4: My husband says, I don't understand short selling. Why do

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Speaker 4: we allow it?

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Speaker 3: And my response is like, oh, because it helps keep

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Speaker 3: markets in our CEOs in check because they have someone

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Speaker 3: being more critical the short I'm just explaining. But you

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Speaker 3: know what if we look at it, like why do

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Speaker 3: we allow short selling?

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Speaker 6: Right? Well, what you see with you know, Andrew Left

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Speaker 6: essentially became sort of a well known short seller in

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Speaker 6: part because of a number of the reports that he released,

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Speaker 6: you know, we wound up leading to actual charges against

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Speaker 6: the company or you know, SEC violations and so on.

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Speaker 6: So he established a you know, having a good reputation

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Speaker 6: in the space. And what the government is saying here

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Speaker 6: is that you know, once he had that reputation, had

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Speaker 6: that audience, he sort of misused that to sort of

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Speaker 6: you know, essentially fool people into moving to a certain

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Speaker 6: position that he himself wasn't maintaining, even though he gave

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Speaker 6: the illusion that that's where he was.

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Speaker 1: What what are the companies involved?

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Speaker 2: Do?

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Speaker 7: What?

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Speaker 1: Do we know? The names?

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Speaker 6: Well, we got everything from Tesla, Roku, Navidia, there's you

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Speaker 6: know about you know, I think two dozen or more

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Speaker 6: in here.

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Speaker 1: And how much did he how much did he make

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Speaker 1: as a result of this? Do we know what? The SEC?

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Speaker 6: Yeah, SEC is saying that he profited as.

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Speaker 2: Just twenty million dollars.

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Speaker 6: Which also involved you know, one of the one of

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Speaker 6: the criminal charges against Andrew is for lying to federal

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Speaker 6: agents claiming that he also wasn't didn't receive a conversational

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Speaker 6: hedge funds. They're saying, you see more than a million

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Speaker 6: dollars from two edge funds.

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Speaker 1: Real quick? Have we heard from mister Left.

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Speaker 6: At the moment, he has, he's not commenting. You know,

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Speaker 6: if that changes, obviously we will we will report that.

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Speaker 4: All right, We appreciate it, Thank you very much.

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Speaker 3: Tom. Tom Schomberg, Bloomberg senior reporter, joining us on that game.

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Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on Apple car Play and

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Speaker 2: Android Auto with the Bloomberg Business App. Listen on demand

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Speaker 2: wherever you get your podcasts, or watch us live on YouTube.

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Speaker 3: Let's get back to the market. Lisa was talking about

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Speaker 3: what's happening in the bond market. You're seen buying pretty

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Speaker 3: much all across the curve. It's been quite a week

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Speaker 3: and we've seen a steepener of the last few days.

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Speaker 4: That has been quite a week.

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Speaker 3: So we want to get some great insight here with

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Speaker 3: Steve Major. He's a global head of fixed income research

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Speaker 3: at HSBC. I keep saying he lives in Asia. It

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Speaker 3: was Hong Kong and now he's in Dubai.

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Speaker 1: But the point is Shanghai Bank of Commerce, right, so.

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Speaker 3: Banking corporation, Okay, But the point is he's never here,

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Speaker 3: so you have to be on the early, early, early show,

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Speaker 3: or he has to stay up late late late for

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Speaker 3: you in order to get him on TV and radio.

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Speaker 3: But he's here in studio and this is very exciting.

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Speaker 3: He's a prolific voice when it comes to the fixed

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Speaker 3: income market.

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Speaker 4: Steve, thanks for being here. It's great to see you.

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Speaker 8: Thank you for having me.

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Speaker 4: So just broad Stokes, What are your calls right now

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Speaker 4: on the US bond market.

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Speaker 8: Well, it's lower yields. We've tended to have a lower

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Speaker 8: as you know. And it's not just for the sake

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Speaker 8: of it. We're not just doing it. We're not doing

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Speaker 8: it to attract attention. It's because we incorporate a more

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Speaker 8: structural and secular approach to the to the forecasting. If

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Speaker 8: you just do it based on the cyclicuse, you'd always

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Speaker 8: have a higher yield. And that might explain why other

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Speaker 8: people think yields should be five. And so to me,

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Speaker 8: if yields are bearing down on four for the ten

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Speaker 8: year right now, and you ask me where we're being

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Speaker 8: a year or so, it's time, I would say nearer

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Speaker 8: to three than five.

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Speaker 1: So you're looking at the stuff that's not necessarily short termy,

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Speaker 1: but the more long term.

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Speaker 8: Stand exactly structural and secular. Structural tends to be more

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Speaker 8: things like regulation. Perhaps secular would be more demographic, so

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Speaker 8: the impact of aging populations, things.

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Speaker 1: That's really long term.

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Speaker 8: Yeah, well yes, but then you need to because you

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Speaker 8: have to have a view on the equilibrium to have

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Speaker 8: a view on the tenure. Now, this is where many

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Speaker 8: people switch off they'll say, well, I can't observe this

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Speaker 8: our star or this equilibrium rate, so I'm not going

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Speaker 8: to use it. Well, everyone who buys or sells a

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Speaker 8: ten year security is implicitly taking a view on that number,

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Speaker 8: because the tenure yield is not defined by today's policy rate,

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Speaker 8: is defined by the path of that policy rate and

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Speaker 8: where it ends up in the longer run. So if

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Speaker 8: you think that the longer un equilibrium policy rate is four,

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Speaker 8: for example, and then you think that the yield probably

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Speaker 8: won't go down much more from here, and you would

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Speaker 8: also think that the FED isn't particularly restrictive. Okay, that's

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Speaker 8: an interesting point.

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Speaker 1: Yeah, it's the FED restrictive because I can't figure out

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Speaker 1: and then also when you answer that question for me,

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Speaker 1: what goes into making that determination whether or not they

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Speaker 1: are restrictive.

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Speaker 8: Yeah, so you know, our assumption is that the fed's

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Speaker 8: longer run equilibrium is about where the FED thinks it is,

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Speaker 8: which is two and a half percent, and it's two

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Speaker 8: point seven to be precise, and it's pretty much unchanged

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Speaker 8: from before the pandemic. Now, I would look at this

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Speaker 8: as scientifically as possible. It's difficult to be a scientist

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Speaker 8: in bonds really, but the point is what has changed?

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Speaker 8: And it's very easy to say the market indicates something

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Speaker 8: has changed, therefore the world has changed. That's not good enough.

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Speaker 8: All there is is a risk premium around the possibility

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Speaker 8: that the world has changed. It is very different. So

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Speaker 8: I think that the policy is restrictive because today's rate

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Speaker 8: is more than double what the longer run equilibrium is.

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Speaker 3: How do you look at something like fiscal stimulus And

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Speaker 3: I appreciate that you're going to say that that's cyclical,

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Speaker 3: but when we're looking at something globally from the energy

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Speaker 3: transition where companies, private equity, and governments are going to

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Speaker 3: be spending boltloads of money in the next thirty years, Yeah,

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Speaker 3: how does that fit into your model?

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Speaker 8: Yeah, so there's a debt, there's a debt and a deficit,

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Speaker 8: there's a stock and a flow effect. I think that

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Speaker 8: when you're talking about deficits that are going up and

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Speaker 8: therefore more bonds, you can see how that can feed

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Speaker 8: into the risk premium. But then the debt stock is

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Speaker 8: a drag on longer run growth because it has to

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Speaker 8: be rolled over and finance, and it takes cash flow

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Speaker 8: away from investment and consumption. My point is that it's

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Speaker 8: just it can be a little bit too easy and

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Speaker 8: somewhat lazy to say there's a lot of supply, therefore

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Speaker 8: the yield has to go up because you really do

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Speaker 8: need to know what's on the other side. Now, when

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Speaker 8: it comes to bonds, the substitution effect, if you like,

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Speaker 8: it depends on the value. What a bonds look like

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Speaker 8: compared to stocks, what a bonds look like compared to money,

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Speaker 8: what do government bonds look like compared to credit, etc. Etc.

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Speaker 8: It strikes me that the valuation argument for bonds is

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Speaker 8: looking pretty good.

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Speaker 1: All right, So what am I supposed to buy right now?

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Speaker 8: Well, most real money investors that's different to a hedge

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Speaker 8: fund or a trader, are sitting in what we call

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Speaker 8: the belly in the middle majorities in credit. That way,

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Speaker 8: they mitigate the negative carry because the market's implying the cuts.

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Speaker 8: So your good quality You can buy indices of good

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Speaker 8: quality credit and you're going to get a yield more

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Speaker 8: than on the S and P five hundred forward earnings.

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Speaker 8: And to me, you could have said that at any

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Speaker 8: point in the last year. But ultimately it's a safe

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Speaker 8: investment to be buying good quality US corporates.

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Speaker 3: What about in the treasury curve. Where do you think

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Speaker 3: we're going to see the most action, Alex.

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Speaker 8: You mentioned the steepener that's been playing out. Do you

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Speaker 8: know that the movement in let's look at twos tens right,

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Speaker 8: the two tens has moved about as much as it

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Speaker 8: did in the one month after the twenty sixteen election,

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Speaker 8: which says that if there is a trade around this,

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Speaker 8: it just played out. It just happened. Now it's all

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Speaker 8: about the probabilities around the election result, and we've just

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Speaker 8: seen a huge swing in that in the last few weeks.

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Speaker 8: So the idea that it was all one way traffic

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Speaker 8: and there was only gonna be one winner and one

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Speaker 8: outcome with one set of policies, that's no longer clear today.

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Speaker 8: So if the steepener was predicated on that, then I

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Speaker 8: think people will start to think again. So it's, you know,

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Speaker 8: to put a steepener on at this point today, given

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Speaker 8: how much it just moved, I think would be dangerous.

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Speaker 3: But what if it wasn't about the election? What if

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Speaker 3: it was about pricing in the cuts?

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Speaker 8: And that's I think you're spot on, because in fact

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Speaker 8: it's been the it's been the recent inflation prints and

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Speaker 8: the calling real economy that has dominated the scenario analysis

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Speaker 8: and the fiscal views and the election views, and so

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Speaker 8: that's explained the steepening. That's explained why two's are pushing

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Speaker 8: to the low yield for the last year. But the

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Speaker 8: problem is, if you enter today, you buy a two

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Speaker 8: year that is so far through the money market rate

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Speaker 8: that if the Fed isn't cutting and cutting by more

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Speaker 8: than is priced in on the WRP screen, you're not

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Speaker 8: going to make any money. And so that's why I

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Speaker 8: think that the steepener may have played out.

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Speaker 1: Okay, so the obligatory question we'll finish up with this September,

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Speaker 1: how and what's the path forward beyond September.

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Speaker 8: The baseline is they do twenty five. The interesting thing

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Speaker 8: is that the scenarios around that, whether it could be

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Speaker 8: more to me to value a bond today, you need

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Speaker 8: to think about not just the next couple of meetings,

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Speaker 8: it's the it's through next year as well. They're in

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Speaker 8: anmazing path and I think that they will deliver at

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Speaker 8: least what's in the in the forwards, which makes it

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Speaker 8: difficult to buy the front end, but makes you want

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Speaker 8: to be a bit higher up.

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Speaker 1: On the curve.

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Speaker 4: Steve, It's so good to see you.

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Speaker 3: Steven Major, Global head of Fixed Income Research at HSBC.

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Speaker 3: So helpful to understand all those different dynamics. I was

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Speaker 3: taking notes.

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Speaker 1: Did you see me here from his underground layer?

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Speaker 4: It doesn't look oh, he was just somewhere else.

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Speaker 3: It just means all right, come back next time. Okay,

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Speaker 3: Well we'll just go with it.

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Speaker 4: Steve Major, the man of mystery, Thank you very much

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Speaker 4: for joining us.

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Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on applecar Play and Android

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Speaker 2: Otto with the Bloomberg Business. You can also listen live

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Speaker 2: on Amazon Alexa from our flagship New York station. Just

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Speaker 2: say Alexa play Bloomberg eleven thirty.

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Speaker 4: All right, two politics we go.

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Speaker 3: So the latest was that former President Barack Obama and

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Speaker 3: Michelle Obama has a have a officially endorsed vice president

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Speaker 3: now presidential candidate.

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Speaker 4: Can I say that now?

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Speaker 1: Kamala Harrish presumptive.

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Speaker 3: Presumptive presumptive nominee Kamala Harris. Nathan Dean Bloomberg Intelligence and

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Speaker 3: your Policy analyst, joins us. Now, Nathan, the last sort

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Speaker 3: of you know, lever falls into place for Kamala Harris.

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Speaker 4: What can we expect over the weekend.

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Speaker 9: So I'm actually hoping that we don't expect all that much.

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Speaker 10: I mean, after two weekends you know of having really

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Speaker 10: big news. But you know the next thing for us

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Speaker 10: really is to try and figure out who Kamala Harris

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Speaker 10: is going to pick as their vice presidential candidate. You know,

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Speaker 10: the the betting markets, which you can find in the

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Speaker 10: terminal at WSL election are really suggesting it's coming down

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Speaker 10: to Senator Mark Kelly of Arizona and Senator Josh Shapiro

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Speaker 10: out of Pennsylvania, you know, Senator Cooper and Senator Bashara

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Speaker 10: out of North Carolina and Kentucky being the others. But

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Speaker 10: you know, just remember that Kamala Harris has a lot

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Speaker 10: of time. The Chicago election isn't until August twenty second,

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Speaker 10: and that's when she actually has to pick that vice

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Speaker 10: president nominee.

442
00:21:57,240 --> 00:22:00,000
Speaker 9: So you know, I'm thinking that they may take some time.

443
00:22:00,000 --> 00:22:00,359
Speaker 9: I'm on this.

444
00:22:00,440 --> 00:22:02,399
Speaker 10: The news cycle is worth them right now. You know,

445
00:22:02,440 --> 00:22:04,480
Speaker 10: maybe they're going to play that up again. So I'm

446
00:22:04,520 --> 00:22:06,360
Speaker 10: thinking for the next week or so, it could be

447
00:22:06,440 --> 00:22:09,320
Speaker 10: just more back to originally what we originally thought.

448
00:22:09,359 --> 00:22:11,359
Speaker 9: Just a campaign for the presidency.

449
00:22:11,560 --> 00:22:15,600
Speaker 1: What it's a history teaches. I mean, Pennsylvania, Shapiro, what

450
00:22:15,760 --> 00:22:18,600
Speaker 1: is it nineteen delegates there?

451
00:22:19,520 --> 00:22:21,560
Speaker 10: Yeah, so I don't remember the number off the top

452
00:22:21,560 --> 00:22:23,600
Speaker 10: of my heads. But you know, for the Democrats, you know,

453
00:22:23,680 --> 00:22:27,040
Speaker 10: the really it's this idea of the Russbelt, Pennsylvania, Michigan,

454
00:22:27,040 --> 00:22:28,840
Speaker 10: in Wisconsin, you know, the other tuples.

455
00:22:29,480 --> 00:22:31,399
Speaker 1: Let me just I just want to might I should

456
00:22:31,400 --> 00:22:34,720
Speaker 1: have follow up with my actual question picking a vice

457
00:22:34,800 --> 00:22:38,399
Speaker 1: presidential candidate, does that really move the needle for the

458
00:22:38,440 --> 00:22:40,040
Speaker 1: person who's on the top of the ticket.

459
00:22:40,280 --> 00:22:40,840
Speaker 9: Does it matter?

460
00:22:40,880 --> 00:22:44,000
Speaker 10: You know, yeah, you know, I think it would matter

461
00:22:44,080 --> 00:22:46,320
Speaker 10: at a specific state level. So if you go with

462
00:22:46,400 --> 00:22:48,919
Speaker 10: Josh Shapiro, you know, obviously I think you're gonna get

463
00:22:48,920 --> 00:22:51,400
Speaker 10: a boost because he's really popular in the state of Pennsylvania.

464
00:22:51,440 --> 00:22:53,960
Speaker 10: But just to remember that we're also talking about the

465
00:22:54,040 --> 00:22:56,840
Speaker 10: vice presidential picks here when it comes to policy and

466
00:22:56,880 --> 00:22:59,399
Speaker 10: the one debate that's between the vice president. You know,

467
00:22:59,560 --> 00:23:01,840
Speaker 10: historic it's usually people don't go to the polls to

468
00:23:01,920 --> 00:23:04,080
Speaker 10: vote for the vice president. They go to the polls

469
00:23:04,080 --> 00:23:06,320
Speaker 10: and they go to the ballots to vote for the president.

470
00:23:06,480 --> 00:23:08,399
Speaker 10: So you know, there's a lot of focus on the

471
00:23:08,520 --> 00:23:10,879
Speaker 10: VP candidates, and then certainly we cover at BI in

472
00:23:10,960 --> 00:23:14,119
Speaker 10: terms of how they can ultimately influence policy and so

473
00:23:14,200 --> 00:23:16,000
Speaker 10: forth like that. But you know, at the end of

474
00:23:16,040 --> 00:23:17,840
Speaker 10: the day, when people go to November, they're going to

475
00:23:17,880 --> 00:23:20,800
Speaker 10: be voting for either President Trump or Vice President Kamala Harris.

476
00:23:21,200 --> 00:23:21,960
Speaker 4: When do we think.

477
00:23:21,800 --> 00:23:24,960
Speaker 3: We're going to get real policy initiatives from Kamala Harris?

478
00:23:25,000 --> 00:23:27,760
Speaker 3: I appreciate that in her first sort of campaign speech,

479
00:23:27,760 --> 00:23:29,240
Speaker 3: she's not going to do that, Like her goal is

480
00:23:29,240 --> 00:23:31,440
Speaker 3: to get everyone jazzed up and excited. When do you

481
00:23:31,480 --> 00:23:33,800
Speaker 3: think we're going to start to hear more specifics?

482
00:23:34,680 --> 00:23:36,480
Speaker 9: I actually don't think it's going to come all that

483
00:23:36,600 --> 00:23:37,160
Speaker 9: too soon.

484
00:23:37,200 --> 00:23:38,919
Speaker 10: I mean, when we went back to look at some

485
00:23:39,040 --> 00:23:41,399
Speaker 10: of their policy statements, we had to go all the

486
00:23:41,440 --> 00:23:44,040
Speaker 10: way back to our time as attorney general as California,

487
00:23:44,080 --> 00:23:46,080
Speaker 10: and I think August they're just going to focus more

488
00:23:46,119 --> 00:23:49,360
Speaker 10: so on this idea of you know, the vice presidential pick,

489
00:23:49,400 --> 00:23:51,040
Speaker 10: and I think you'll see a little bit more on

490
00:23:51,119 --> 00:23:53,719
Speaker 10: border and a little bit more on immigration. But when

491
00:23:53,760 --> 00:23:56,080
Speaker 10: it comes to like her economic policy, you know, foreign

492
00:23:56,080 --> 00:23:58,480
Speaker 10: relations and so forth like that, I think we aren't

493
00:23:58,480 --> 00:24:00,960
Speaker 10: going to see the specifics until we get to September,

494
00:24:01,160 --> 00:24:04,000
Speaker 10: which is the debate season, and so after Labor Day,

495
00:24:04,040 --> 00:24:06,879
Speaker 10: after the August recess, I think Americans will really be

496
00:24:06,880 --> 00:24:09,160
Speaker 10: paying attention to the race then, and at that point,

497
00:24:09,240 --> 00:24:12,000
Speaker 10: Kamala Harris is going to have to explain those policy positions.

498
00:24:12,240 --> 00:24:13,919
Speaker 10: I think the next two weeks or so, they're just

499
00:24:13,960 --> 00:24:16,159
Speaker 10: going to try and figure it out, just because remember

500
00:24:16,160 --> 00:24:18,800
Speaker 10: that her campaign is only what four days old, five

501
00:24:18,880 --> 00:24:20,800
Speaker 10: days old at this point, so I think there's still

502
00:24:20,800 --> 00:24:22,639
Speaker 10: a lot of baby steps that campaign has to do,

503
00:24:23,040 --> 00:24:25,640
Speaker 10: and then we'll see more and more of the policy statements,

504
00:24:25,640 --> 00:24:28,160
Speaker 10: I think towards Labor Day and maybe even to September.

505
00:24:28,160 --> 00:24:29,679
Speaker 1: At that point, do you know how long we have

506
00:24:29,720 --> 00:24:32,800
Speaker 1: to wait before we get really good polling data?

507
00:24:34,640 --> 00:24:34,840
Speaker 9: You know?

508
00:24:35,119 --> 00:24:37,240
Speaker 10: I think it's the first We've already started to see

509
00:24:37,240 --> 00:24:39,960
Speaker 10: the first polls that have come out post the Biden decision,

510
00:24:40,080 --> 00:24:42,800
Speaker 10: but it's early, and it's at a national level. I

511
00:24:42,800 --> 00:24:44,960
Speaker 10: think some more of the state polling data that was

512
00:24:45,000 --> 00:24:47,720
Speaker 10: more important to us in terms of like Pennsylvania, Arizona

513
00:24:47,760 --> 00:24:50,280
Speaker 10: and so forth like that, that's being conducted this week,

514
00:24:50,320 --> 00:24:52,520
Speaker 10: and so I think, you know, and please don't hold

515
00:24:52,520 --> 00:24:54,320
Speaker 10: me to this, it'll probably be the tail end of

516
00:24:54,359 --> 00:24:56,440
Speaker 10: next week when we start to see that do.

517
00:24:56,720 --> 00:24:59,080
Speaker 4: We trust polls now, John Tucker? Is that something that

518
00:24:59,119 --> 00:24:59,640
Speaker 4: we do.

519
00:25:00,520 --> 00:25:02,399
Speaker 1: A Dewey defeated Truman, didn't he?

520
00:25:03,000 --> 00:25:07,040
Speaker 4: Oh, okay, it was a little bit ago though. So

521
00:25:07,160 --> 00:25:09,840
Speaker 4: when it comes to the campaign, is the campaign and

522
00:25:09,920 --> 00:25:14,560
Speaker 4: infrastructure for President Biden, is that infrastructure set up for

523
00:25:14,680 --> 00:25:16,800
Speaker 4: Kamala Harris right now to do what she needs to

524
00:25:16,800 --> 00:25:18,280
Speaker 4: do and travel a lot and do a lot of

525
00:25:18,359 --> 00:25:19,680
Speaker 4: rallies and get her name out there.

526
00:25:20,400 --> 00:25:22,800
Speaker 10: According to them, yes, but I would say just you know,

527
00:25:22,920 --> 00:25:25,399
Speaker 10: it's also you know, you have the ground staff, but

528
00:25:25,440 --> 00:25:27,480
Speaker 10: you also have the leadership staff, and I think the

529
00:25:27,560 --> 00:25:30,800
Speaker 10: lead leadership staff is going to obviously change, if not

530
00:25:30,920 --> 00:25:33,080
Speaker 10: in direct positions, but in terms of influence.

531
00:25:33,280 --> 00:25:34,159
Speaker 9: I mean, look, you know.

532
00:25:34,240 --> 00:25:36,760
Speaker 10: Vice President Harris had a campaign back in twenty twenty

533
00:25:37,000 --> 00:25:38,480
Speaker 10: didn't go so well for us. She was one of

534
00:25:38,520 --> 00:25:42,280
Speaker 10: the first people to drop out of the Democratic nomination process. However,

535
00:25:42,520 --> 00:25:45,119
Speaker 10: you know, the Democratic Party is fairly aligned at this point,

536
00:25:45,160 --> 00:25:46,800
Speaker 10: and so I think that there are other people out

537
00:25:46,840 --> 00:25:49,840
Speaker 10: there who are certainly interested, if not serving in the campaign,

538
00:25:49,960 --> 00:25:52,440
Speaker 10: but at least be able to whisper into that campaign.

539
00:25:52,480 --> 00:25:53,760
Speaker 9: So I think what's.

540
00:25:53,520 --> 00:25:56,120
Speaker 10: Happening right now is that you know, obviously they're going

541
00:25:56,160 --> 00:25:58,359
Speaker 10: through this growth. They didn't really have much of a

542
00:25:58,400 --> 00:26:01,080
Speaker 10: plan up until Sunday or maybe a few days beforehand.

543
00:26:01,280 --> 00:26:02,880
Speaker 9: So I think they'll have another week or two.

544
00:26:02,880 --> 00:26:06,240
Speaker 10: But then, you know, come August, early August, mid August,

545
00:26:06,320 --> 00:26:07,160
Speaker 10: I think they'll be fine.

546
00:26:07,160 --> 00:26:08,959
Speaker 9: In terms of moving forward.

547
00:26:09,119 --> 00:26:11,280
Speaker 1: Is there going to be a debate? Is that a

548
00:26:11,280 --> 00:26:11,720
Speaker 1: sure thing?

549
00:26:12,800 --> 00:26:14,399
Speaker 9: Well, you know, I certainly think so.

550
00:26:14,520 --> 00:26:17,159
Speaker 10: I mean, look, if President Trump, you know it would

551
00:26:17,280 --> 00:26:19,119
Speaker 10: were to back out with one of the dates, the

552
00:26:19,160 --> 00:26:22,600
Speaker 10: September tenth date, if I recall correctly, is still moving forward.

553
00:26:22,680 --> 00:26:25,640
Speaker 10: And I think they've invited both candidates for a September

554
00:26:25,720 --> 00:26:26,520
Speaker 10: seventeenth debate.

555
00:26:26,560 --> 00:26:28,440
Speaker 9: And look, if one of the one of the.

556
00:26:28,359 --> 00:26:30,560
Speaker 10: Candidates at this point decides to drop out, I think

557
00:26:30,560 --> 00:26:33,280
Speaker 10: that's a serious, uh mistake on their part.

558
00:26:33,320 --> 00:26:36,320
Speaker 9: But you know, it's Washington politics. Anything can happen.

559
00:26:36,359 --> 00:26:38,879
Speaker 10: But I think at this point, certainly they'll entertain and

560
00:26:38,960 --> 00:26:41,080
Speaker 10: I think ultimately they'll have one, if not two debates

561
00:26:41,119 --> 00:26:41,760
Speaker 10: going forward.

562
00:26:42,040 --> 00:26:44,080
Speaker 4: Oh boy, we're definitely watching that.

563
00:26:45,320 --> 00:26:45,520
Speaker 2: Well.

564
00:26:45,600 --> 00:26:48,120
Speaker 1: I'm worrieds just like the forum, that it's going to take.

565
00:26:48,320 --> 00:26:52,000
Speaker 3: Yeah, all right, Nathan, we thank you. We really do

566
00:26:52,080 --> 00:26:53,960
Speaker 3: hope you have a weekend for the first time in

567
00:26:54,040 --> 00:26:58,360
Speaker 3: quite a while. Nathan Dean, Bloomberg Intelligence Senior policy analyst,

568
00:26:58,400 --> 00:27:00,800
Speaker 3: don't scare the guy.

569
00:27:01,080 --> 00:27:04,960
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

570
00:27:05,040 --> 00:27:08,120
Speaker 2: weekdays at ten am Eastern on Apple car Play and

571
00:27:08,119 --> 00:27:11,040
Speaker 2: Android Auto with the Bloomberg Business app. You can also

572
00:27:11,080 --> 00:27:14,280
Speaker 2: listen live on Amazon Alexa from our flagship New York

573
00:27:14,320 --> 00:27:18,000
Speaker 2: station Just Say Alexa playing Bloomberg eleven thirty.

574
00:27:19,160 --> 00:27:21,720
Speaker 3: Focus on Unis is brought to you by Build America

575
00:27:21,840 --> 00:27:25,800
Speaker 3: Mutual ensures of US municipal bond that finance essential American

576
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Speaker 3: infrastructure and provides guaranteed income to improve any portfolio. Be

577
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Speaker 3: part of Building America. Invest in BAM insured bonds.

578
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Speaker 4: How'd I do?

579
00:27:35,000 --> 00:27:38,960
Speaker 1: Amanda come out? You can chime in there, go bam bam.

580
00:27:39,560 --> 00:27:39,720
Speaker 2: Oh.

581
00:27:39,760 --> 00:27:41,760
Speaker 4: She sounded like me and I first started doing the show.

582
00:27:41,960 --> 00:27:44,359
Speaker 3: Yeah, sure, where we're going to get you just gotta

583
00:27:44,359 --> 00:27:46,520
Speaker 3: really own it and like jump in there. Amanda Albright

584
00:27:46,880 --> 00:27:49,800
Speaker 3: is a municipal finance reporter and she joins us from

585
00:27:49,840 --> 00:27:50,639
Speaker 3: Bloomberg News.

586
00:27:51,160 --> 00:27:51,960
Speaker 4: Okay, a man the.

587
00:27:51,960 --> 00:27:54,600
Speaker 1: Mantle, I should say from Joe Mysek, you have some

588
00:27:54,680 --> 00:27:57,400
Speaker 1: pretty big shoes to fill there, Amanda.

589
00:27:57,320 --> 00:28:00,320
Speaker 7: Yes, very big shoes to Bill Pressure.

590
00:28:00,320 --> 00:28:02,879
Speaker 4: We support you, We miss him, and we support you.

591
00:28:03,640 --> 00:28:05,400
Speaker 3: There are a couple of stories that caught my eye

592
00:28:05,400 --> 00:28:08,320
Speaker 3: this week because I'm I'm very I have lack of

593
00:28:08,320 --> 00:28:10,679
Speaker 3: confidence when it comes to my ability to discuss muni's,

594
00:28:10,720 --> 00:28:12,320
Speaker 3: so I want to make sure that I can handle

595
00:28:12,320 --> 00:28:12,840
Speaker 3: this segment.

596
00:28:13,680 --> 00:28:15,840
Speaker 4: Goldman Sachs makes a bet.

597
00:28:15,560 --> 00:28:18,760
Speaker 3: On a muni et F market one hundred and nine

598
00:28:18,800 --> 00:28:20,520
Speaker 3: billion dollar meuni ETF market.

599
00:28:20,880 --> 00:28:22,080
Speaker 4: What have they done this week?

600
00:28:23,480 --> 00:28:27,399
Speaker 7: Yeah, so Goldman has joined the rush of firms that

601
00:28:27,400 --> 00:28:32,399
Speaker 7: we've seen that have started offering muni bond ETF's. Goldman

602
00:28:32,440 --> 00:28:35,159
Speaker 7: sax Asset Management already had immuniti ETF, but they are

603
00:28:35,240 --> 00:28:38,680
Speaker 7: kind of getting deeper involved in the space with four

604
00:28:38,720 --> 00:28:41,520
Speaker 7: new funds. So one of the funds appeals to folks

605
00:28:41,560 --> 00:28:44,840
Speaker 7: in New York that are worried about their taxes that

606
00:28:44,880 --> 00:28:48,240
Speaker 7: it's been a common theme lately. There's another fund that

607
00:28:48,320 --> 00:28:52,200
Speaker 7: kind of mimics like a cash like fund, except it's

608
00:28:52,240 --> 00:28:55,440
Speaker 7: tax exempt. So I'm like money market funds that are

609
00:28:55,480 --> 00:28:58,560
Speaker 7: paying you know, upwards of five percent. You can kind

610
00:28:58,560 --> 00:29:02,000
Speaker 7: of shield your tax is if you invest in their

611
00:29:02,040 --> 00:29:05,520
Speaker 7: ultra short MUNI fund. So we've seen a bunch of

612
00:29:05,720 --> 00:29:09,320
Speaker 7: companies get further involved in the ETF space just because

613
00:29:09,320 --> 00:29:12,360
Speaker 7: it seems like that's kind of that and separately managed

614
00:29:12,360 --> 00:29:15,360
Speaker 7: accounts are becoming a little bit more popular compared to

615
00:29:15,480 --> 00:29:17,040
Speaker 7: traditional mutual funds.

616
00:29:17,080 --> 00:29:21,320
Speaker 1: And these are actively managed funds, right, and you said

617
00:29:21,400 --> 00:29:24,040
Speaker 1: ultra short, so that sort of sets them apart from others.

618
00:29:25,440 --> 00:29:29,960
Speaker 7: Yeah, And interestingly enough, it seems like actively managed is

619
00:29:30,040 --> 00:29:34,040
Speaker 7: where other companies kind of see more of an opportunity

620
00:29:34,040 --> 00:29:38,160
Speaker 7: to make an impact. The passive space within muny ETFs

621
00:29:38,240 --> 00:29:41,720
Speaker 7: is very dominated by Vanguard and black Rock. They have

622
00:29:41,840 --> 00:29:46,120
Speaker 7: two extremely large funds that are both passive passively managed,

623
00:29:46,880 --> 00:29:48,960
Speaker 7: and so I think it's a little bit harder for

624
00:29:49,080 --> 00:29:53,880
Speaker 7: other companies to kind of gain market share in that segment.

625
00:29:53,920 --> 00:29:58,400
Speaker 7: So we're seeing most of the launches within actively managed.

626
00:29:58,320 --> 00:29:59,560
Speaker 1: And are they popular.

627
00:30:00,000 --> 00:30:01,760
Speaker 4: I was going to ask that, Oh he stole it.

628
00:30:01,800 --> 00:30:04,320
Speaker 1: See it's a mind she held between the two of us.

629
00:30:05,920 --> 00:30:06,720
Speaker 4: Actively managed.

630
00:30:06,720 --> 00:30:10,360
Speaker 7: It is definitely making it's growing, but I still think

631
00:30:10,480 --> 00:30:14,600
Speaker 7: it's really hard to compete with to passively managed funds

632
00:30:14,600 --> 00:30:16,680
Speaker 7: that are I think when I ran the numbers, it

633
00:30:16,720 --> 00:30:20,600
Speaker 7: was close to seventy billion between the two of them.

634
00:30:20,680 --> 00:30:24,160
Speaker 7: So I still think passively managed, being you know, so

635
00:30:24,320 --> 00:30:26,920
Speaker 7: cheap and so easy for investors to get involved in,

636
00:30:28,000 --> 00:30:30,880
Speaker 7: is still like we shouldn't we shouldn't write that off.

637
00:30:31,160 --> 00:30:33,160
Speaker 7: But I think a lot of the money managers are

638
00:30:33,160 --> 00:30:37,200
Speaker 7: betting that active will eventually gain more adoption.

639
00:30:37,360 --> 00:30:39,600
Speaker 1: And I'm guessing that these are for people who live

640
00:30:39,680 --> 00:30:41,400
Speaker 1: in high tech states.

641
00:30:41,080 --> 00:30:42,800
Speaker 4: Right exactly.

642
00:30:42,880 --> 00:30:46,800
Speaker 1: So it's just offered where like New York, California, New Jersey.

643
00:30:46,960 --> 00:30:49,720
Speaker 7: So there's a California fund and then a New York fund.

644
00:30:50,880 --> 00:30:54,120
Speaker 7: So when we spoke to the folks at Goldman, you know,

645
00:30:54,160 --> 00:30:58,680
Speaker 7: they just mentioned that they're still hearing concerns about perennially

646
00:30:59,240 --> 00:31:02,200
Speaker 7: perannial concern about high taxes in both of those states,

647
00:31:03,080 --> 00:31:06,240
Speaker 7: and that's you know, kind of been We're seeing a

648
00:31:06,240 --> 00:31:09,600
Speaker 7: lot of demand for unis generally this year, and definitely

649
00:31:10,240 --> 00:31:14,160
Speaker 7: taxes are part of that, especially given folks not knowing

650
00:31:14,160 --> 00:31:17,360
Speaker 7: what's going to happen next year with tax rates. Taxes

651
00:31:17,360 --> 00:31:18,400
Speaker 7: are front and center.

652
00:31:18,600 --> 00:31:20,160
Speaker 4: Let's move to another great story.

653
00:31:20,200 --> 00:31:22,720
Speaker 3: It was a big take this week you and a

654
00:31:22,720 --> 00:31:24,560
Speaker 3: couple of your colleagues wrote about it, and the title

655
00:31:24,640 --> 00:31:27,280
Speaker 3: is Harvard's four hundred and sixty five million dollars in

656
00:31:27,440 --> 00:31:30,760
Speaker 3: tax benefits draw some new scrutiny. Can you tell us

657
00:31:30,800 --> 00:31:33,680
Speaker 3: about this big take What was your takeaway and would

658
00:31:33,720 --> 00:31:34,040
Speaker 3: you learn?

659
00:31:35,360 --> 00:31:38,719
Speaker 7: Yeah, so we have a story just kind of examining

660
00:31:39,000 --> 00:31:43,040
Speaker 7: different tax benefits that Harvard has just given the very

661
00:31:43,080 --> 00:31:47,160
Speaker 7: intense focus on Harvard for the past I guess year

662
00:31:48,760 --> 00:31:52,240
Speaker 7: they we focused a lot on the property side because

663
00:31:52,280 --> 00:31:55,800
Speaker 7: there's a very rich and kind of long standing debate

664
00:31:55,880 --> 00:32:00,640
Speaker 7: over tax exempt property in college towns across the US,

665
00:32:00,680 --> 00:32:04,120
Speaker 7: not just in Boston and Cambridge, but we found that

666
00:32:04,760 --> 00:32:08,520
Speaker 7: within Boston and Cambridge there is kind of a growing

667
00:32:08,680 --> 00:32:12,360
Speaker 7: push to have Harvard pay more in what's known as

668
00:32:12,800 --> 00:32:16,080
Speaker 7: payments in lieu of taxes or pilots, and that's basically

669
00:32:16,080 --> 00:32:19,160
Speaker 7: an annual payment that Harvard makes every year to account

670
00:32:19,160 --> 00:32:21,600
Speaker 7: for the fact that it's property is tax exempt. Which

671
00:32:22,760 --> 00:32:25,120
Speaker 7: this is a debate that could be could be had

672
00:32:25,160 --> 00:32:28,880
Speaker 7: at any college town with any university pretty much because

673
00:32:29,960 --> 00:32:32,840
Speaker 7: city leaders are always going to want more from their universities.

674
00:32:33,440 --> 00:32:36,640
Speaker 7: But I think just the growing wealth at Harvard and

675
00:32:37,080 --> 00:32:40,240
Speaker 7: you know, sky high tuition has just kind of reinvigorated

676
00:32:41,080 --> 00:32:46,520
Speaker 7: this debate and it's a really interesting topic and also

677
00:32:46,640 --> 00:32:51,920
Speaker 7: very relevant to many elite institutions, the debate that's taking

678
00:32:51,960 --> 00:32:54,719
Speaker 7: place both in city halls but also in Congress because

679
00:32:55,520 --> 00:32:59,000
Speaker 7: the Ivy League has become a major target lately.

680
00:32:59,520 --> 00:33:03,840
Speaker 1: Okay, apolitic the intersection of politics and munichs Hey in

681
00:33:03,880 --> 00:33:06,520
Speaker 1: the MEUNI space, if we can back up for what

682
00:33:06,640 --> 00:33:09,760
Speaker 1: is issuance like and what are some of the more

683
00:33:09,880 --> 00:33:12,040
Speaker 1: interesting issues that you see out there.

684
00:33:13,400 --> 00:33:17,120
Speaker 7: Yeah, issuance has been pretty surprising this year. I think

685
00:33:17,160 --> 00:33:21,680
Speaker 7: it's up thirty eight percent, a record first half of

686
00:33:21,720 --> 00:33:25,840
Speaker 7: the year. That was something that Joe loved covering when

687
00:33:25,880 --> 00:33:27,040
Speaker 7: he was with US.

688
00:33:27,280 --> 00:33:31,400
Speaker 1: Oh, he retired. We sound like he's died. He's retired, retired,

689
00:33:31,480 --> 00:33:32,600
Speaker 1: he's on a beach somewhere.

690
00:33:33,400 --> 00:33:36,480
Speaker 7: He's Yes, he's still rooting us on and reading our coverage.

691
00:33:37,240 --> 00:33:40,400
Speaker 7: But there's just been so many for just kind of

692
00:33:40,400 --> 00:33:44,400
Speaker 7: a preview for terminal readers. In a little bit, we

693
00:33:44,400 --> 00:33:46,920
Speaker 7: should have a story about how a lot of these

694
00:33:46,960 --> 00:33:51,040
Speaker 7: deals are getting totally gobbled up. There's like kind of

695
00:33:51,080 --> 00:33:54,280
Speaker 7: you know, the food fight for for MUNI deals. Some

696
00:33:54,360 --> 00:33:57,920
Speaker 7: investors are kind of frustrated by this because they can't

697
00:33:57,960 --> 00:34:01,320
Speaker 7: get enough bonds that they put in order for and

698
00:34:01,360 --> 00:34:05,080
Speaker 7: we're really seeing this across the board for you know,

699
00:34:05,240 --> 00:34:07,440
Speaker 7: even very vanilla bond structures.

700
00:34:07,480 --> 00:34:11,080
Speaker 4: And then you know, it's actually surprised me.

701
00:34:11,120 --> 00:34:12,879
Speaker 7: There's not been a ton of deals that I've been

702
00:34:12,920 --> 00:34:15,400
Speaker 7: really like, oh, this is so interesting that they're doing this.

703
00:34:16,080 --> 00:34:18,960
Speaker 7: It's just kind of a typical infrastructure that we're seeing

704
00:34:19,360 --> 00:34:21,960
Speaker 7: getting funded, and not a ton of like you know,

705
00:34:22,440 --> 00:34:25,520
Speaker 7: high yield issuances, but just kind of across the board

706
00:34:26,239 --> 00:34:30,640
Speaker 7: general obligation bonds, triple A, double A, and but yet there's.

707
00:34:30,360 --> 00:34:31,440
Speaker 4: So much demand for them.

708
00:34:31,880 --> 00:34:34,000
Speaker 7: And I think part of that is people are worried

709
00:34:34,080 --> 00:34:37,239
Speaker 7: that this is a rush before the election, trying to

710
00:34:37,239 --> 00:34:39,360
Speaker 7: get ahead of any volatility, and people are worried that,

711
00:34:39,480 --> 00:34:43,040
Speaker 7: you know, after November, these sales are going to go away,

712
00:34:43,080 --> 00:34:44,960
Speaker 7: so you kind of have to get in the market

713
00:34:45,000 --> 00:34:46,200
Speaker 7: now while you while you can.

714
00:34:46,640 --> 00:34:49,640
Speaker 1: So this is exciting. Is anybody on shaky ground?

715
00:34:51,640 --> 00:34:56,200
Speaker 7: No, I'm so surprised that everything is just anytime. The

716
00:34:56,280 --> 00:35:00,640
Speaker 7: US economy is doing well, COMMUNI issuers are they do well?

717
00:35:00,760 --> 00:35:03,640
Speaker 7: States do well. I just saw Virginia. I think they

718
00:35:03,640 --> 00:35:06,799
Speaker 7: had a billion more in tax revenue than anticipated for

719
00:35:06,840 --> 00:35:10,600
Speaker 7: the most recent fiscal year. Like it's really surprising just

720
00:35:10,719 --> 00:35:15,680
Speaker 7: how well state and local finances have been holding up.

721
00:35:15,880 --> 00:35:19,400
Speaker 7: It's pretty remarkable, but that just speaks to the broader economy.

722
00:35:19,760 --> 00:35:22,160
Speaker 3: Yeah, I was going to say, like it is really surprising,

723
00:35:22,160 --> 00:35:24,399
Speaker 3: particularly as the whole narrative of the COVID funding it

724
00:35:24,440 --> 00:35:28,000
Speaker 3: is running out. They're going to have huge budgets shortfalls,

725
00:35:28,120 --> 00:35:30,319
Speaker 3: and I feel like I have yet to hear that.

726
00:35:31,960 --> 00:35:37,440
Speaker 7: Yeah, we definitely haven't. Where I see stress is more

727
00:35:39,560 --> 00:35:43,440
Speaker 7: higher ed private colleges. Those aren't kind of typical classic

728
00:35:43,840 --> 00:35:46,359
Speaker 7: munique credits or you know, they're not funded necessarily by

729
00:35:46,719 --> 00:35:49,680
Speaker 7: tax revenues. But where we're seeing stress is not necessarily

730
00:35:50,080 --> 00:35:53,319
Speaker 7: states and cities. It's more like a private college that's

731
00:35:53,320 --> 00:35:56,080
Speaker 7: sold muny bonds. And I was talking with a colleague

732
00:35:56,080 --> 00:35:59,920
Speaker 7: today about how schools that have been relying on pandemic

733
00:36:00,040 --> 00:36:02,800
Speaker 7: really funding. Those are the areas that, now that the

734
00:36:03,200 --> 00:36:06,400
Speaker 7: funding is running out, schools are kind of where the

735
00:36:06,440 --> 00:36:10,000
Speaker 7: stress is being seen rather than like the city, though

736
00:36:10,000 --> 00:36:12,319
Speaker 7: of course there's probably exceptions out there.

737
00:36:12,680 --> 00:36:14,120
Speaker 4: All right, Amanda, thank you so much.

738
00:36:14,160 --> 00:36:17,399
Speaker 3: We really appreciate Amanda Albright Municipal Bonds report. Does Joe

739
00:36:17,400 --> 00:36:20,680
Speaker 3: Myisick like really email you about your stories of course.

740
00:36:21,080 --> 00:36:21,799
Speaker 4: Oh my god.

741
00:36:21,840 --> 00:36:25,240
Speaker 3: I love that he's retired, but he's not he's reading,

742
00:36:25,440 --> 00:36:28,600
Speaker 3: he's listening. Yes, please tell him that we say hi,

743
00:36:29,120 --> 00:36:30,280
Speaker 3: I learned la a lot.

744
00:36:30,160 --> 00:36:33,040
Speaker 1: That was really interesting and you are so like.

745
00:36:33,160 --> 00:36:37,800
Speaker 4: Not so scared. Every Friday, nieds, I definitely get nervous.

746
00:36:38,080 --> 00:36:42,600
Speaker 2: This is the Bloomberg Intelligence Podcast, available on apples, Spotify,

747
00:36:42,800 --> 00:36:45,720
Speaker 2: and anywhere else you will get your podcasts. Listen live

748
00:36:45,800 --> 00:36:49,400
Speaker 2: each weekday ten am to noon Eastern on Bloomberg dot com,

749
00:36:49,480 --> 00:36:52,920
Speaker 2: the iHeartRadio app, tune In, and the Bloomberg Business app.

750
00:36:53,000 --> 00:36:56,160
Speaker 2: You can also watch us live every weekday on YouTube

751
00:36:56,239 --> 00:36:58,120
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