Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanivik. We're here every day bringing
Speaker 1: you the latest news from the world of business and finance,
Speaker 1: plus technology, politics, economics, all partnising the power of Business
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Speaker 1: You can also listen to our radio show at two
Speaker 1: pm Eastern Time on Bloomberg Radio or watch us on
Speaker 1: YouTube search Bloomberg Global News. So safe to say our
Speaker 1: kids just cannot catch a break. Between the pandemic and
Speaker 1: being schooled at home for a long time, missing out
Speaker 1: on all important socialization for months at a time, and
Speaker 1: then the chronic shootings in schools and society where kids
Speaker 1: often end up being the target. It has been a
Speaker 1: worldful of stress for our younger citizens. We did hear
Speaker 1: the House of Representatives yesterday passing and sweeping gun reform law,
Speaker 1: but it seems like it's not going to get past
Speaker 1: the Senate. Let's get into it and specifically what it
Speaker 1: means for our nation's youth, joining us as dot or tomorrow. Mendelssohn,
Speaker 1: Director of the Center for Adolescent Health at the Johns
Speaker 1: Hopkins Bloomberg School of Public Health, the Johns Hopkins Bloomberg
Speaker 1: School of Public Health that is supported by Michael R. Bloomberg,
Speaker 1: the founder of Bloomberg LP and Bloomberg Philanthropies. Dr Medison,
Speaker 1: we wanted you on the program today because you're an
Speaker 1: expert in adolescent mental health, child psychology, and you can
Speaker 1: really give us an overview on what our nation's kids
Speaker 1: go through, not just if they you would experience a
Speaker 1: horrific event like this, but just preparing for events like this.
Speaker 1: When I was in school, we weren't doing drills for
Speaker 1: active shooters. Carol, I know it wasn't happening when you
Speaker 1: were a Columbine. Happened my freshman year of high school,
Speaker 1: and I feel that was a sort of a changing
Speaker 1: moment um. How do we need to think about this
Speaker 1: in the context of mental health. Yeah, so thank you
Speaker 1: for having me. It's a pleasure to be with you today.
Speaker 1: And yes, you're absolutely right that these kinds of events have,
Speaker 1: you know, sort of cute and then ongoing impact for
Speaker 1: young people. And of course the young people who are
Speaker 1: most affected are either out of school where shooting has happened,
Speaker 1: or you know, in community in some way. But even
Speaker 1: young people who may live far away are going to
Speaker 1: hear about these events through the media, and like you're saying,
Speaker 1: they may also be experiencing drills or other change procedures
Speaker 1: in their school. So I think it's important for parents
Speaker 1: to understand that this might raise anxieties and concerns for
Speaker 1: young people. And I think it's really important to sort
Speaker 1: of know your child as well as to be thinking
Speaker 1: about their age and their developmental stage. So, you know,
Speaker 1: for very young children, you may decide you want to
Speaker 1: turn the news off, and you you know, you may
Speaker 1: want to sort of create space around this for children
Speaker 1: who are going to be hearing about this at school
Speaker 1: or through friends. Um, I think it's really important to
Speaker 1: create space for your child to talk about what they've heard,
Speaker 1: what they're feeling, and what their questions are. Sometimes kids
Speaker 1: have misperceptions or fears about events that parents can really
Speaker 1: help to talk through. It's also important for parents to
Speaker 1: work through their own emotions for talking with children so
Speaker 1: that we can really be focused on on what our
Speaker 1: children's needs are and I think the more that we
Speaker 1: can provide you know, basic information that is in line
Speaker 1: with how old our kids are and kind of what
Speaker 1: they're ready to hear, that that can be really helpful
Speaker 1: for young people well. And I do think about you know,
Speaker 1: we always talk about in our world, in our realm,
Speaker 1: about public private partnerships, and I do think about you know,
Speaker 1: mental well being wellness. I do feel like we took
Speaker 1: a major step forward during the pandemic and coming off
Speaker 1: of George Floyd. I mean, there were just a lot
Speaker 1: of very strong conversations and understandings being felt and made.
Speaker 1: But I also do think that we need to still
Speaker 1: continue to move forward on this and think about the
Speaker 1: role of schools maybe in all of this um and
Speaker 1: making sure that there are environments where kids who are
Speaker 1: struggling get the support at home, but maybe also at
Speaker 1: these educational institutions. I agree with that. I think schools
Speaker 1: are really important resource for our our young people's total health.
Speaker 1: So teachers can also help to create space to have
Speaker 1: sort of safe, age appropriate conversations about current events. And
Speaker 1: also schools are spaces where young people who have emerging
Speaker 1: mental health needs can hopefully be identified and can be
Speaker 1: um provided with the supports that they need, and that
Speaker 1: might come from a school mental health UH specialist, or
Speaker 1: it might come from referrals for outside sources. But I
Speaker 1: think schools are often really important gateways to for connecting
Speaker 1: children with services that they need. I'm just trying to
Speaker 1: understand the differences between what's happening now and what's happened,
Speaker 1: you know, since Columbine, and what happened before that, And
Speaker 1: I'm trying to figure out as we look for answers
Speaker 1: in a really difficult time. I think for a lot
Speaker 1: of people, what is it about America that makes us
Speaker 1: unique when it comes to these types of mass shootings?
Speaker 1: And in the developed countries I should say, Okay, yeah,
Speaker 1: So I think a common misperception right now is that
Speaker 1: mental health issues cause mass shootings, and I think, um,
Speaker 1: what's true is that guns cause mass shootings. And so
Speaker 1: you know, gun policy is going to be critical for
Speaker 1: resolving that this problem in our country. Mental health care
Speaker 1: is incredibly important and does need more attention, but that's
Speaker 1: not the answer to reducing mass shootings. So what would
Speaker 1: be the answer to reducing mass shootings? So I think
Speaker 1: gun control policies are really critical. I mean, one of
Speaker 1: the things that differentiates our country from others is um
Speaker 1: the policies that we have around gun ownership, access to guns,
Speaker 1: and so forth, And so I think that's a really
Speaker 1: important area. And in fact, there are experts at the
Speaker 1: Bloomberg School who study those policies specifically and can really
Speaker 1: speak well to what's needed in this area. How do
Speaker 1: you know when it's a crisis moment um, Dr Mendelssohn,
Speaker 1: and it's not a case of just having a conversation
Speaker 1: sin and that there's something more that needs to be done. Yeah, So,
Speaker 1: I mean, I think that one thing for parents to
Speaker 1: watch for is always shifts in children's behavior. So if
Speaker 1: you're noticing something really different, your child is suddenly withdrawing
Speaker 1: from things they used to enjoy or having very different behavior,
Speaker 1: seeming distressed in a different kind of way, that's something
Speaker 1: to pay attention to. And I think having open communication
Speaker 1: with children is always really important so that they do
Speaker 1: feel comfortable opening up when you ask them about what's
Speaker 1: going on. And that's another thing too, is to ask
Speaker 1: don't assume that children will um broach the topic, but
Speaker 1: if you make it a safe space to be able
Speaker 1: to say when something is bothering them and that's sort
Speaker 1: of ongoing in your family. Culture makes it easier when
Speaker 1: crises do arise. Dr Medlson. I'm wondering, you know, as
Speaker 1: as a parent, and people who listen to the show
Speaker 1: regularly know that I have a three year old, and
Speaker 1: you know, I sometimes talk with my wife if you know,
Speaker 1: how do we know if he's acting like a normal
Speaker 1: three year old versus uh, something that we should have
Speaker 1: an eye on? Us relatively new parents? What is the
Speaker 1: way to know that stuff without actually going to a
Speaker 1: doctor and speaking to somebody who is an expert in
Speaker 1: child behavior. Yeah, that's a great question. I do think
Speaker 1: there's lots of great online resources through the American Academy
Speaker 1: of Pediatrics and other sort of respected UM sources of
Speaker 1: information on child development. UM. There are also great books
Speaker 1: out there. But again, when when in real doubt, UM,
Speaker 1: it is it is helpful to talk to a pediatrician
Speaker 1: directly or a child mental health specialist? Um, it's you know, Unfortunately,
Speaker 1: we are living in a society where I think most
Speaker 1: would say more of this is going to come and
Speaker 1: is going to be more stress on our younger population. UM.
Speaker 1: Is it ever too young to start having these conversations. Again,
Speaker 1: I think that as long as conversations are developmentally appropriate,
Speaker 1: it so for instance, for younger kids, often fewer details
Speaker 1: are better, keeping things more concrete and simple. UM. I
Speaker 1: think if conversations are developed developmentally appropriate UM and do
Speaker 1: not overwhelm children unnecessarily with information that makes them feel
Speaker 1: sort of paralyzed and afraid, then I think it's really
Speaker 1: healthy and in fact, UM crises or events that happen
Speaker 1: in the world can be opportunities to talk to children
Speaker 1: about how we can have positive impact on the world
Speaker 1: and how we can identify what our values are and
Speaker 1: work to change problems that come up in the world.
Speaker 1: And that can be a way of helping empower young
Speaker 1: people to think about how they can take action. Dr Mendelson,
Speaker 1: before you, before we leave and wrap up, we did
Speaker 1: want to get to that there was an act that
Speaker 1: passed in Baltimore, and I think it's very relevant to
Speaker 1: this conversation. Can you just fill us in on that.
Speaker 1: Absolutely so, Baltimore past the Elijah Coming Healing City Act
Speaker 1: to really address the widespread historical trauma and collective trauma
Speaker 1: in Baltimore due to the effects of structural racism and
Speaker 1: UM sort of historic wrongs that have been done, and
Speaker 1: this initiative, this is the only citywide legislation path to
Speaker 1: really create a trauma informed, trauma responsive city. That's a
Speaker 1: really exciting opportunity UM. And there's a task force to
Speaker 1: help oversee how this UM legislation really gets enacted. But
Speaker 1: more importantly, there's real engagement with community UM. The idea
Speaker 1: is to have a community movement UM that can really
Speaker 1: promote healing in Baltimore. Hopefully this will be a model
Speaker 1: for other cities. I think it's important to note that
Speaker 1: while you know this, the school shootings have been devastating,
Speaker 1: that many communities, such as those in Baltimore, have experienced
Speaker 1: violence in an ongoing way. Dr mar Medalson directed the
Speaker 1: Center for Adolescent Health at the Johns Hopkins at Bloomberg
Speaker 1: School of Public Health. You're listening to Bloomberg Business Week
Speaker 1: with Carol man Her and Bloomberg Quick Takes Tim Stinovic
Speaker 1: on Bloomberg Radio. We want to get to the cover
Speaker 1: story and the Bloomberg Big Take, and might we add
Speaker 1: the cover image alone is a must see. The stories
Speaker 1: about Larry Ellison, the Oracle billionaire. You know him well,
Speaker 1: who's making his Hawaiian island more hospitable to the super rich,
Speaker 1: but pushing out families that have been there for generations.
Speaker 1: Sophia Alexander had the enviable task of traveling to Lanai
Speaker 1: and spending some serious time in Hawaii. She's the author
Speaker 1: of this cover story for Bloomberg Business which he's Wealth
Speaker 1: Team reporter for Bloomberg News. She's with us in the
Speaker 1: Bloomberg Interactor Broker Studio. Joe Weber is the editor of
Speaker 1: Bloomberg Business Week. He joins us in the Interactive Broker
Speaker 1: Studio as well. Joel, I want to start with the
Speaker 1: Lord of Lenai, the cover of Bloomberg Business Week. You
Speaker 1: do each week, tell us how the sausage is made
Speaker 1: when it comes to the cover, But this one is
Speaker 1: particularly poignant. Uh So. It's a painting of Larry Ellison
Speaker 1: um in a very you know, provocative kind of pose
Speaker 1: of of um him sort of as like almost as
Speaker 1: a conquisador um. And there's a very traditional Hawaiian vibe
Speaker 1: to the artwork, which is also reflected in the artwork
Speaker 1: that we've commissioned for the story on the inside. UM.
Speaker 1: But you know, the Yeah, let's just say Larrialison did
Speaker 1: not want to participate in the story. UM, so hence
Speaker 1: why you have to recruit an artist to like make
Speaker 1: a painting. Um. This one is a really interesting story though,
Speaker 1: And honestly I knew nothing about this, although I have
Speaker 1: been to Hawaii to the islands that look at Lanai
Speaker 1: and you're like, WHOA, what's that island? And Lanai is
Speaker 1: this amazing story in and of itself because it's basically
Speaker 1: always been as long as it's been, um, you know,
Speaker 1: sort of developed and civilized in the you know, quote
Speaker 1: unquote modern terms. Um, it has really the ownership of
Speaker 1: that highland has been in very few hands. It was
Speaker 1: forever a dull plantation. Another dull billionaire basically bought it
Speaker 1: um and then just a decade ago fell into Larrialison's hands.
Speaker 1: And for all the conversations that happened about Hawaii, and
Speaker 1: I think Mark Zuckerberg has gotten a ton of attention
Speaker 1: for what he's sort of cobbled together. Nobody owns an island.
Speaker 1: Larry Olson bought the whole thing. This island is hit
Speaker 1: and he can basically do with it whatever he wants.
Speaker 1: But that means the three thousand locals who live there
Speaker 1: and they rent from him and basically owned from him.
Speaker 1: Have found themselves in a really difficult position. So Sophie,
Speaker 1: you went there, you talked to them. Are what are
Speaker 1: they experiencing? Yes, So it's interesting because they're used to, uh,
Speaker 1: their island being owned by a billionaire. There was a
Speaker 1: billionaire before Larry Allison that owned it, David Murdoch. Um.
Speaker 1: As you mentioned, he was the Dole chairman at the
Speaker 1: time he took it over, I believe, um. But he
Speaker 1: was what they now call a poor billionaire. He was
Speaker 1: worth like a couple of billion dollars compared to Ellison's
Speaker 1: roughly billion dollars on any given day. It's just this
Speaker 1: amount of wealth is so unfathomable to pretty much anyone,
Speaker 1: and so they're seeing firsthand what he can actually do
Speaker 1: with it. Um. So Ellison, you know, he owns pretty
Speaker 1: much everything, He controls pretty mu everything, and because of
Speaker 1: his massive fortune, he can really like shape this island
Speaker 1: into what he wants. The other billionaire, you know, was
Speaker 1: letting the hotels run down, the community pool was writing down.
Speaker 1: He just couldn't afford to keep it up. But it's
Speaker 1: not a problem for Allison. So what is Allison doing.
Speaker 1: Is he investing, is he propping everything up? And is
Speaker 1: he embracing the locals. So it depends who who you ask.
Speaker 1: There are some people who are really happy with what
Speaker 1: he's done. You know, one person I talked to who
Speaker 1: is in the story, Gail Allen. She says, you know,
Speaker 1: he bought the grocery story and he turned into a
Speaker 1: mini Whole Foods, which you know, she's very happy about,
Speaker 1: and a lot of people would be very happy about.
Speaker 1: But you know, the Whole Foods is like the marker
Speaker 1: of gentrification. After all, Um and a lot of other
Speaker 1: people on the island are more anxious because the problem is,
Speaker 1: no one really knows what Larry's plans are. And he
Speaker 1: is very you know, like behind the scenes. The old
Speaker 1: billionaire who owned it, David Murdock, he was very involved
Speaker 1: in the community. He talked to people in the community.
Speaker 1: But Larry does not engage with the community at all.
Speaker 1: He's never been into a community meeting. He basically let
Speaker 1: his company do the talking for him, and even the
Speaker 1: people who work there. When the people I talked to
Speaker 1: said she has no idea what his plans are. So
Speaker 1: you get that perspective, but you also get a perspective
Speaker 1: of people who are affiliated with with him, right and
Speaker 1: who who have worked for him. And so there's this
Speaker 1: this other side of the conversation, which is he can
Speaker 1: kind of do anything he wants, right, and so what
Speaker 1: what what has he done on that side? Because he
Speaker 1: has spent some money there. Yes, he's spent a bunch
Speaker 1: of money. I mean one of the first things he did,
Speaker 1: let's just start there, is build a noboo on the island.
Speaker 1: He said at one point that when he arrived the
Speaker 1: food with Yeah, exactly, Um, well there's actually the one
Speaker 1: noboo and then there's sense a by no boo, So
Speaker 1: there's actually that's for the mass exactly. You know, it's
Speaker 1: like two no boos on one small island. Um. You know,
Speaker 1: he renovated the four seasons hotels. He spent tens of
Speaker 1: millions of dollars on that, and so now rooms at
Speaker 1: the ocean side one on thousands, even tens of thousands
Speaker 1: of dollars a night for some of the sweets. Still
Speaker 1: is that where she stayed? When she staying? You know,
Speaker 1: he hasn't seen the expense concluded answer that I'm just
Speaker 1: gonna say, I haven't seen it. So I don't. I
Speaker 1: don't know, keep going and so, and there's a bunch
Speaker 1: of other stuff that he's doing. He is building a
Speaker 1: new housing project because housing is huge issue on the island.
Speaker 1: There's a bunch of stuff he wants to do, but
Speaker 1: there's nowhere for these construction workers to live. Um. And
Speaker 1: then more recently, most recently, he's also building a Monches
Speaker 1: Story School. And the big question is whose kids are
Speaker 1: those for? Well, I thought was really poignant part of
Speaker 1: the story when you included the question that one of
Speaker 1: your one of the people you featured in the story
Speaker 1: asked about the research that they did with the mon
Speaker 1: A Story School. Is their communication with the established school
Speaker 1: to make sure that the curriculum actually melds with when
Speaker 1: these kids graduate and go there. How does that speak
Speaker 1: to the way that what's happening on the island isn't
Speaker 1: perhaps necessary necessary early organic. Yeah, I mean communication or
Speaker 1: lack thereof is the biggest concern among residents, even those
Speaker 1: who are more in favor of him. They just don't
Speaker 1: really know what's happening at anyone time. Like so the
Speaker 1: rumor mill or coconut wireless as it's called on the island. Yeah,
Speaker 1: is you know, people depend on it for their news.
Speaker 1: He owns the community newspaper now too. So, um, we
Speaker 1: didn't talk about some other exclusive reporting relating to Tom Cruise.
Speaker 1: What happened? What happened when Tom came to visit? Yeah,
Speaker 1: so this was It's a funny story because if you
Speaker 1: just bring up with anyone on the island, if you're like,
Speaker 1: do you remember when Tom Cruise visited, They're like, oh, yeah,
Speaker 1: and he flipped his car and you know, a total
Speaker 1: to crash it. Um his car, not his car, Larry's car. Um.
Speaker 1: So back in around when Tom Cruise visited the island,
Speaker 1: he was a guest of David Ellison, who uh Tom
Speaker 1: works with, Uh it's Larry Son on their movies and
Speaker 1: itating Top Gun, Maverick, the the new blockbuster. I heard
Speaker 1: of it. Um when he came to visit. He was
Speaker 1: using one of Larry's cars and he was on one
Speaker 1: of the dirt roads in Lenai and he flipped it,
Speaker 1: totaled the car, you know, and that kind of thing
Speaker 1: just is never reported anywhere because this is Larry's island.
Speaker 1: You know. They basically called his company were like come
Speaker 1: clean it up. Then they did. They exactly they smashed
Speaker 1: the car, recycled it, and then that's that and no
Speaker 1: one ever hears of it again. As I said at
Speaker 1: the top, so obsessed with this story. Check it out.
Speaker 1: It's a great read online interactive stuff going on, Sophie.
Speaker 1: Thank you so much, Sophie, Alexander Wealth Team reporter and
Speaker 1: of course Jill Weber, the editor of Business Week. This
Speaker 1: is Bloomberg Business Week with Carol Masser and Bloomberg Quick
Speaker 1: Takes Tim Stinovic on Bloomberg Radio. A story that's among
Speaker 1: our most ready the most read in the last eight hours.
Speaker 1: Now is it right now? Yeah? I just checked. I
Speaker 1: know it's been like moving up there. It's about how
Speaker 1: one day ahead of the CPI printing unit, it states
Speaker 1: inflation is topping ten on key items that Americans just
Speaker 1: cannot avoid. I mean, I don't know about you, food
Speaker 1: and grant gas. If you're listening right now, you know
Speaker 1: exactly what we are talking about. Olivia Rockman is on
Speaker 1: the story. She's US Economy reporter for Bloomberg News. She's
Speaker 1: with this right now in the Bloomberg Interactive Broker's studios.
Speaker 1: So I read this story and I thought, and I've
Speaker 1: said this throughout the program tod Olivia. This story has
Speaker 1: Carol's name written all over it because she thinks it's
Speaker 1: like a waste of time to strip out food and
Speaker 1: energy when it comes to inflation, because who's not using
Speaker 1: energy and who's not eating food. For the longest time,
Speaker 1: economists were stripping this out because energy for a month
Speaker 1: at a time would be volatile, or food would randomly
Speaker 1: spike and then come back down because of hurricane or
Speaker 1: like just one off things that would happen. But we're
Speaker 1: in this environment now where everything is spiking at the
Speaker 1: same time, and so to just say, oh, those are
Speaker 1: volatile and we're not going to look at them, is
Speaker 1: it isn't working in this very pandemic inflationary environment. The
Speaker 1: other thing is we're talking before we got go. I mean,
Speaker 1: oil isn't everything to transport Haiti in the moving around
Speaker 1: the world. Like, how do you get away from it?
Speaker 1: I said to you before we got going. Every time
Speaker 1: I fill up, where do you go? I'd fill up
Speaker 1: my take and I'm like, oh, but you know what,
Speaker 1: this doesn't cost me anything because it's not a part
Speaker 1: of the core. I mean, I don't know, but that
Speaker 1: credit card statement comes at the end of the month
Speaker 1: and it's there, Um, is there a rethink or dig
Speaker 1: a little bit more into your story and what you
Speaker 1: wanted to get to in reporting this out. So a
Speaker 1: lot of this comes down to what the FED is
Speaker 1: watching when they're setting policy. And for the longest time,
Speaker 1: the FED really did only look at the core because
Speaker 1: they didn't have to worry about these categories. They would fluctuate,
Speaker 1: come back down. At this point, the FED has no
Speaker 1: choice but to look at food, energy and electricity and say,
Speaker 1: how is this impacting Americans? And are we going to
Speaker 1: take action on these categories that maybe before we would
Speaker 1: write off. And it does seem like, based on what
Speaker 1: we've heard from Powell, that they are looking at those
Speaker 1: categories more than they had ever in the past. We
Speaker 1: spoke to Insignerella Global macro strategist here at Bloomberg News
Speaker 1: a little earlier in the program. He gave us his
Speaker 1: predictions for tomorrow. He's not looking at year over year,
Speaker 1: he's looking at month to month, and he says, if
Speaker 1: we see a print that's too hot, the market is
Speaker 1: going to go crazy month to month because it's expecting
Speaker 1: seven tons of a percent. If it see something hotter
Speaker 1: than that, then that's going to be bad news. Talk
Speaker 1: to me about expectations. We have the Bloomberg economists, you know,
Speaker 1: analysis and what we think it's going to be. What
Speaker 1: is your reporting tell you? The economists that I've talked
Speaker 1: to you this week have all said risks are to
Speaker 1: the upside on the print, both for month over month
Speaker 1: and year over year. That's on the headline figure, so
Speaker 1: that that's the ones that include food, energy, and electricity.
Speaker 1: The core may actually cool because we may see apparel, furniture,
Speaker 1: kind of discretionary inventors. Yeah, but the restart to the
Speaker 1: upside because of what gases are doing. We have gas
Speaker 1: almost at five dollars a gallon nationwide. You've got food
Speaker 1: spiking because of Ukraine everything. So if anything, we might
Speaker 1: see something hotter according to economists, Um, and the cool
Speaker 1: offt doesn't look great. And I guess you know we've
Speaker 1: talked about this, Tim and I certainly have, and with
Speaker 1: our TV colleagues and our simulcast, just the broader impact
Speaker 1: that this is having on Americans, right we we've seen
Speaker 1: kind of these sobering stories of people making choices. I
Speaker 1: was actually checking out. I mean, we talked about this
Speaker 1: earlier and I was buying a few things at the
Speaker 1: grocery store in there, buying some paper towels, and it
Speaker 1: was so expensive. I'm like, I don't really need these
Speaker 1: right now, that's ridiculous. You know. You do start to think, okay,
Speaker 1: I'll put this back, and you make some choices, and
Speaker 1: for some the choices are really hard, especially low income Americans. Yeah,
Speaker 1: and we're almost going back to the K shaped recovery
Speaker 1: that we had talked about so often in we talked
Speaker 1: about with Peter Atwater William and Mary a Lot who
Speaker 1: coined that phrase. Yeah, so you've got low income consumers
Speaker 1: really feeling the pinch of this inflation because the majority
Speaker 1: of the spending is on these necessities versus hire income
Speaker 1: Americans who also spend on discretionary categories. So real spending
Speaker 1: is actually pretty strong. Still, well, that fall potentially, but
Speaker 1: we do see the dichotomy the reason we do care
Speaker 1: about this too, and court we could go on for
Speaker 1: this core versus non core, but I mean, at some point,
Speaker 1: like we just said, you do make some choices, and
Speaker 1: we're so concerned. Right now, we start from the ECB
Speaker 1: in Christine Leguard, right, we're worried about Okay, people are
Speaker 1: having to make choices where do they cut back and
Speaker 1: how does that lead to an economic slowdown? And that's
Speaker 1: just the question, right consumer spending in this current environment
Speaker 1: is I think what will be the straw to break
Speaker 1: the camel's back in terms of recession, And the past
Speaker 1: has been financial conditions, Probably not now right, because it's
Speaker 1: been so strong, right, and it's been going because of
Speaker 1: all the stimulus. Some darring figures in Your Peace Olivia
Speaker 1: of households found it's somewhat are very difficult to pay
Speaker 1: for usual household expenses, according to the US Census Bureau
Speaker 1: survey conducted in late April and early made that compares
Speaker 1: to at the same time last year. How much worse
Speaker 1: is it going to get? We know that energy, food
Speaker 1: and electricity are expected to continue to rise this summer,
Speaker 1: and that's at a time when people drive more in
Speaker 1: the summer, people need air conditioning in this summer, and
Speaker 1: so all predictions show that the summer could be probably
Speaker 1: the worst time of the environment that we're in. There
Speaker 1: are some predictions that things could get better in the fall,
Speaker 1: and the good news is we do still have a
Speaker 1: strong labor market, and so that's what we need to
Speaker 1: be watching really closely to have an understanding of where
Speaker 1: people are going to be, because if the labor market
Speaker 1: also weekends, we really are going to have trouble for
Speaker 1: some Americans. And just understand folks that just because there's
Speaker 1: a core cp I, it's like, oh okay, that doesn't
Speaker 1: impact me. I'm going to still go out and spend.
Speaker 1: It's just not real. And I think very very timely
Speaker 1: in terms of the conversation, the Fed though, pays attention
Speaker 1: to CPI or is it really pc So historically pc
Speaker 1: was their measure, but they have no choice but to
Speaker 1: look at all the measures given the taking the day
Speaker 1: off tomorrow. I don't know what schedule. I don't think
Speaker 1: it's ignoring it. Media calling they want to know, and
Speaker 1: they're like, no, no, no, no, it's it's pc E.
Speaker 1: I'm just trying to, like, you know, um, Olivia, thank you,
Speaker 1: thank you. I appreciate it. This is right our most
Speaker 1: read story on the Bloomberg Olivia Rockman U s economy
Speaker 1: reporter at Bloomberg News about inflation topping ten percent in
Speaker 1: those key items that I gotta tell you we just need.
Speaker 1: I'm broadly oh, journal, yeah, but you let me drive.
Speaker 1: Oh no, no, no, no home honey, please, I'll do
Speaker 1: the right gravels. I want to drive. It's a good question.
Speaker 1: This is the drive to the clothes up down on
Speaker 1: Bluebird Radio. I just got about ten and a half
Speaker 1: minutes left in today's trading session, getting ready to soon
Speaker 1: wrap up this Thursday trading day. Man, Tim, we are
Speaker 1: near our loads of the session. Let's get into it
Speaker 1: with ryand Trick, chief market strategist at LPL Financially, joins
Speaker 1: us on the phone from Charlotte, North Carolina. Ryan, good
Speaker 1: to have you back with us. A really good day
Speaker 1: to have you with us as well, because you look
Speaker 1: at technicals where the technicals you're keeping an eye on.
Speaker 1: Is there anything to be optimistic about? Yeah, Tim and Carol,
Speaker 1: thanks for having me back. You know, the truth is
Speaker 1: this guy's we've had some over soul bounces, but we're
Speaker 1: not quite seeing historically which it tend to see at
Speaker 1: a major low, which is like, let's get a little
Speaker 1: geeky on you like updates, up volume days, you tend
Speaker 1: to see clusters of those. We haven't quite seen those
Speaker 1: clusters yet, So we all make at the end of
Speaker 1: the world, we don't think We don't see a recession,
Speaker 1: we don't see major selling weakness from here. But is
Speaker 1: May nineteenth the lows that's the big question, of course,
Speaker 1: And just think of this. It's a mid term year.
Speaker 1: We talked a lot about that. Mid term years historically
Speaker 1: don't bottom find their ultimate bottom until about August fourteenth.
Speaker 1: On average. Only twice in history has the low for
Speaker 1: the year taking place earlier than May nineteenth. Not saying
Speaker 1: that it couldn't have happened, but just be aware that
Speaker 1: maybe a little summer bounce, but maybe a third quarter
Speaker 1: low is is probably what we're what we're likely going
Speaker 1: to see this year. All right, When does a technician,
Speaker 1: technical and analyst like yourself just kind of say, oh,
Speaker 1: come on, this is an environment we really have never
Speaker 1: lived here them before. I can't even look at history
Speaker 1: to figure out what's gonna up and next. Yeah, Carol,
Speaker 1: you're right, I mean inflation, hoart of your eyes and inflation,
Speaker 1: the FED rying to shut down, coming off the heels
Speaker 1: of a hundred year pandemic, all those things. Yes, but
Speaker 1: you know what we also started to see earlier year
Speaker 1: defensive things lead like utilities like healthcare, like staples, kind
Speaker 1: of hallmarks they're not necessarily a bear market, but just
Speaker 1: more of a risk off scenario. So as long as
Speaker 1: we keep seeing that, it's just something to um, something
Speaker 1: be aware of. Now. Also, Carol, you know this was
Speaker 1: the fourth worst start to year. So what does it
Speaker 1: mean when? What does it mean when defensive leads? Yeah,
Speaker 1: we simply that. Yeah, when you see the more defensive
Speaker 1: things like your staples and utilities leading, that's just they
Speaker 1: the market's way of saying, listen, something could be a
Speaker 1: little off. Maybe let's let's be slightly more defensive here.
Speaker 1: Um as you know, like we saw last year, I
Speaker 1: when when the tech leads and communications lead, that's more
Speaker 1: of a healthier market really starting last November. But was
Speaker 1: it healthy last year or was it a case of
Speaker 1: so much liquidity in the system chasing the momentum players. Well,
Speaker 1: well it could could be, you're right, could be a
Speaker 1: little bit of both. I guess the profits still count
Speaker 1: from that point of view. But but you're right it
Speaker 1: it was healthy. But starting late last year, we started
Speaker 1: to see something something as simple as it advanced the
Speaker 1: kline line to is how many stocks going up versus down?
Speaker 1: That peaked late last year and started a weekend as well.
Speaker 1: So these are some cracks that were there. But I
Speaker 1: just want a point one one positive thing. I don
Speaker 1: want to sound too negative if you're one positive thing.
Speaker 1: This is the fourth worst start to year ever for
Speaker 1: the SMP, five hundreds of the one hundredth day, all right,
Speaker 1: that just happened recently. The rest of the year, when
Speaker 1: you look at the five worst start ever, the rest
Speaker 1: of the year is up about nineteen percent on average
Speaker 1: for the SMP. So we've been here before. We had
Speaker 1: rough stars before. So then again, okay, wait, okay, fourth
Speaker 1: worst start to year. The technical analyst Carol, I just
Speaker 1: don't type in right fast enough. Fourth worst start to
Speaker 1: a year for the SMP as of the hundredth day,
Speaker 1: and then what usually happens to talk to you, Yeah, well,
Speaker 1: the rest of the year has been higher five of
Speaker 1: the last five times with the worst five starts ever
Speaker 1: they were thirty two, thirty, ninety sixty two, and Evan,
Speaker 1: those were the five war starts ever as a day,
Speaker 1: and the rest of the year was higher every time
Speaker 1: of nineteen percent on average. So we've seen some bad starts,
Speaker 1: so we were you know, this has been a rough year,
Speaker 1: no doubt. With bonds not participating in all the problems
Speaker 1: we've had. But still we don't see a recession near Carol.
Speaker 1: And historically we don't have a recession. You attend the
Speaker 1: bottom around nineteen or twenty percent, right, nineteen seventy six,
Speaker 1: two thousand, eleven, ninety eight, and twenty eighteen, all years
Speaker 1: without a recession with a nineteen percent correction. We just
Speaker 1: corrected nineteen percent on the SMP. So history don't repeat.
Speaker 1: But at rhyme, said Mark Twain, we think we're in
Speaker 1: the range where this is still opportunity for investors. When
Speaker 1: all is said and done with this year, maybe we
Speaker 1: don't go back to positive, but there we could be
Speaker 1: a good deal higher than when we are in our
Speaker 1: opinions right here with the equities, all right, give us
Speaker 1: some other things to be optimistic about. Or actually, you
Speaker 1: know what, you just gave us some optimism. Talk about
Speaker 1: recessionary risks here. I know you said we don't see
Speaker 1: a recession. Why do you not see a recession? Yeah,
Speaker 1: well we see a slowdown here, Tim, I mean, like
Speaker 1: a lot of people. All right, we came into this
Speaker 1: year saying four percent GDP growth. We're down to two
Speaker 1: and a half percent. The truth is, we still need
Speaker 1: the consumer is pretty strong, and I know what Target
Speaker 1: has said and Walmart has said, but it's still in
Speaker 1: consumer confidence. I mean, the Michigan consumer confidence in near
Speaker 1: eleven year lows. But we're still seeing some pretty solid
Speaker 1: um solid spending. I mean, I travel a good deal,
Speaker 1: you know, I know you guys do I factual By
Speaker 1: the way, guys, I'll be in New York this Monday
Speaker 1: for the first time since the pandemic, so right away,
Speaker 1: you know things are starting to open up. And the
Speaker 1: truth is, you know, everyone bought stuff right, goods likely
Speaker 1: Goods inflation likely is already peaked, but it's the services
Speaker 1: inflation that might peak over the next month or so.
Speaker 1: And lots of the services are still still strong in
Speaker 1: our opinion. And just one more positive thing, I think
Speaker 1: look at backlogs, right, some of the recent data we've
Speaker 1: seen in backlogs with supply chains, we've seen some big improvements.
Speaker 1: It's not perfect by any means, but again, that big
Speaker 1: CPI number, every's gonna talk about it. We're optimistic that
Speaker 1: we're seeing some improving backlogs in time to delivery and
Speaker 1: some of those things that are saying, hey, it's light
Speaker 1: aga into the tunnel, and inflation likely is gonna peak
Speaker 1: quite soon, and that could be the positive driver for
Speaker 1: confidence um the second half of this year, depending on it.
Speaker 1: Is a glass half full of the glass half empty
Speaker 1: when it comes to financial markets in the equity trade. Well,
Speaker 1: by nature, I'm a glass half full type. I knew
Speaker 1: that about you, Ryan. I was gonna say there's no
Speaker 1: way he's going to go with classes. When you look
Speaker 1: at anything is possible. But when you look at the charts,
Speaker 1: you still feel that way. Yeah, sure, yeah, no, we do.
Speaker 1: I mean, listen, we knew this was a midtermor community year.
Speaker 1: Your Averridge midtermure pulls back seventeen percent after a hundred
Speaker 1: and fifteen percent rally. It's only a five percent correction
Speaker 1: all last year. It made sense to us it wouldn't
Speaker 1: be as easy. We didn't see quite this much weakness.
Speaker 1: I'll be honest this soon in the year. But the
Speaker 1: truth again is is negative sentiment is all over the place.
Speaker 1: Everybody's worried, and that makes sense because of what's happened.
Speaker 1: But let's not forget. You know, when everyone's on one
Speaker 1: side of the boat, the opportunities on the other. So
Speaker 1: we do think that any good news at all. Maybe
Speaker 1: some of the economy. Maybe it's on the Fed. We
Speaker 1: think it'll be the fan. We don't think the fan's
Speaker 1: gonna hike ten eleven times, maybe more like seven or
Speaker 1: eight this year. Inflation comes back down. That could be
Speaker 1: the deposit house. One more thing, one more thing. Earnings
Speaker 1: expectations this year, Earning supposed to go this year they
Speaker 1: last year. All right, that's that's pretty good. I mean
Speaker 1: that doesn't sound recession or to us. We're still creating
Speaker 1: three fourtwood jobs a month. Things are perfect. But again,
Speaker 1: we think we can aford a recession, more of a slowdown,
Speaker 1: not a recession than that could be an opportunity for
Speaker 1: investors here. Well. To be fair, our Tom Orlick ahead
Speaker 1: of our Bloomberg economic chief economist who's got research outs,
Speaker 1: has slowed down. Yes, recession. No, So I feel like
Speaker 1: it mirrors to some extent what you just had to say, Hey, Ryan,
Speaker 1: thank you so much. Safe travels to New York. Ryan Dietrich,
Speaker 1: chief market strategist at LPL Financial, on the floor on
Speaker 1: the phone from Charlotte, North Carolina. So optimism, Yeah, of
Speaker 1: course you can tell he's optimistic. Guy. No, I did not.
Speaker 1: I'm gonna let you say it. I've got it, so
Speaker 1: you're gonna have to help correct a lot of technicals there.
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